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Civil Appeal No. 274 of 1959. Appeal by special leave from the judgment and order dated July 27,1956, of the Madras High Court, in C.R.P. No. 90 of 1955. N. C. Chatterjee, R. Ganapathy Iyer and G. Gopalakrishnan for the appellant. K. N. Rajagopala Sastri, R. Mahalinga Iyer and M. section K. Aiyengar, for respondent No. 1. 1960. November, 28. The Judgment of the Court was delivered by WANCHOO, J. This is an appeal by special leave in an insolvency matter. The brief facts necessary for present purposes are these. S.V.N. Nanappa Naicker and his sons were adjudged insolvents on an application of Smt. Engammal (hereinafter referred to as the respondent). They had preferred an appeal before the High Court of Madras but it was dismissed on April 17, 1953. Thereafter the official receiver took steps to sell the property of the insolvents, which consisted of two lots, the first lot comprising 145 acres 10 cents of dry land and masonry house, and the second lot, 8 acres and odd of dry land. Both these properties were subject to mortgage. The official receiver fixed September 28, 1953, for sale of the properties by auction. Fifteen of the creditors were present when the sale by auction took place, including the son of the respondent. No request was made on that day by anyone for postponing the sale and consequently bids were made. The highest bid for lot 1 was of 692 Rs. 4500/ and the highest bid for lot 2 was of Rs. 70/ . Both these bids were made by the appellant who is a brother in law of Nanappa Naicker. The reason why the two lots were sold for Rs. 4570/ was that there was an encumbrance on the entire property of Rs. 17,200/ . The official receiver did not close the sale on that day in the hope that some higher offers might be made by the creditors and postponed it to various dates upto October 26, 1953. On all these dates, the respondent 's son was present but no higher offer was made on behalf of the respondent. On October 26, 1953, an application was made on behalf of the respondent praying that the sale be postponed for another three months apparently on the ground that there had been drought in that area for some years past and agricultural lands were not fetching good price. The official receiver, however, saw no reason to postpone the sale, particularly when no higher offer was forthcoming from the side of the respondent and decided to knock down the properties in favour of the appellant. Later, an application was made on behalf of the respondent on November 18, 1953 under section 68 of the , No. V of 1920 (hereinafter referred to as the Act). The case of the respondent was that the sale had been made for a very inadequate price and there had been drought in the village for several years in the past and there was very great stringency in the money market and it was hoped that if the sale was postponed for three or four months, the properties would fetch a good price of not less than Rs. 15,000/ , exclusive of the sum due on the encumbrances. The respondent also stated that if the sale was postponed for three months she would be prepared to bid more than Rs. 7500/ for the properties. There were some other allegations in the petition suggesting collusion between the official receiver on the one side and the 693 insolvent and the appellant on the other. The respondent therefore prayed that the official receiver should be ordered not to sell the properties to the appellant at the price bid by him. The application was opposed by the official receiver as well as by the appellant. The official receiver contended that he had done his best and that no higher bid could be obtained. He also denied the allegation made against him in the nature of collusion and also about the manner of conducting the sale. The Subordinate Judge allowed the application on the ground that the price fetched was low and that the general body of creditors to whom debts to the extent of Rs. 30,000/ were payable would be considerably prejudiced if the sale was allowed to stand. Thus the only ground on which the application under section 68 was allowed was that the price fetched was low. Thereupon there was an appeal to the District Judge under section 75 of the Act. The District Judge allowed the appeal. He pointed out that there was nothing to show that there was any irregularity in the conduct of the sale. He also pointed out that there was no reason to hold that the official receiver was in any way in collusion with the insolvent and the appellant. He also pointed out that the respondent 's son was all along present and if he really thought that the price fetched at the auction sale was low he could offer a higher price on behalf of the respondent. Finally, the District Judge held that the Subordinate Judge was not right in his view that the property had been sold for a low price and gave various reasons for coming to that conclusion. The matter was then taken in revision under the proviso to section 75 of the Act, which lays down that "the High Court for the purpose of satisfying itself that an order made in any appeal decided by the District Court was according to law, may call for the case and pass such order with respect thereto as it 694 thinks fit". The High Court however did not consider the question whether the order of the District Judge was according to law. It appears that before the High Court an offer was made by the respondent that she was prepared to deposit Rs. 9,000/ if a fresh auction was held and would start the bid at Rs. 9,000/ and also that she would pay Rs. 1,000/ to the appellant for any loss caused to him. The High Court accepted this offer, though it was of opinion that it could not be said that the price fetched at the auction was unconscionably low; it however held that the price was low considering the extent and nature of the properties, and if Rs. 9,000/ or more could be got for the properties the creditors would receive appreciably more as dividend. It therefore allowed the revision on the terms offered by the respondent. It is this order of the High Court which has been brought before us by special leave and the only question that has been urged on behalf of the appellant is that the High Court had no jurisdiction to interfere with the order of the District Judge unless it came to the conclusion that the order was not according to law. It is contended at the High Court 's order does not show that it applied its mind to the question whether the order of the District Judge was according to law or not and that the High Court seems to have been carried away by the offer made by the respondent to make minimum bid of Rs. 9,000/ for those properties. It is pointed out however that this offer was made three years after the auction and is no indication that the price fetched in the auction in 1953 was inadequate, for prices may have risen during this period of three years. On the other hand, it is contended on behalf of the respondent that the court 's power under section 68 in appeal from an act of the receiver is much wider than the power of the court in dealing with 695 auction sales in execution proceedings and therefore the Subordinate Judge was right in setting aside the act of the receiver in knowing down the properties to the appellant and the High Court was consequently right in setting aside the order of the District Judge and resorting that of the Subordinate Judge. It may be accepted that the power of the court under section 68 in not hedged in by those considerations which apply in cases of auction sales in execution proceedings. Even so, the power under section 68 is a judicial power and must be exercised on well recognised principles, justifying interference with an act of the receiver which he is empowered to do under section 59 (a) of the Act. The fact that the act of the receiver in selling properties under section 59 (a) is subject to the control of the court under section 68 does not mean that the court can arbitrarily set aside a sale decided upon by the official receiver. It is true that the court has to look in insolvency proceedings to the interest in the first place of the general body of creditors; in the second place to the interest of the insolvent, and lastly, where a sale has been decided upon by the official receiver to the interest of the intending purchaser in that order. Even so, the decision of the official receiver in favour of a sale should not be set aside unless there are good grounds for interfering with the discretion exercised by the official receiver. These grounds may be wider than the grounds envisaged in auction sales in execution proceedings. Even so, there must be judicial grounds on which the court will act in setting aside the sale decided upon by the official receiver. These grounds may be, for example, that there was fraud or collusion between the receiver and the insolvent or the intending purchaser; the court may be also interfere if it is of opinion that there were irregularities in the conduct of the sale which might have affected the 696 price fetched at the sale; again, even though there may be no collusion, fraud or irregularity, the price fetched may still be so low as to justify the court to hold that the property should not be sold at that price. These grounds and similar other grounds depending upon particular circumstances of each case may justify a court in interfering with the act of the official receiver in the case of sale by him under section 59 (a) of the Act. The High Court had therefore to see whether the Subordinate Judge 's order was justified on these grounds and whether the District Judge made any mistake in law in reversing that order. If the Subordinate Judge 's order was not justified on these grounds or if the District Judge made no mistake in law in interfering with that order, the High Court cannot interfere in revision under the proviso to section 75, for the High Court 's jurisdiction to interfere arises only if it is of opinion that the District Judge 's order was not according to law. If the High Court comes to that conclusion, it can then pass such order as it may think fit. Let us therefore turn first to the order of the Subordinate Judge and see if it is justified on the ground mentioned above. Now both the Subordinate Judge and the District Judge found that there was no reason to hold that there was any fraud or collusion on the part of the official receiver in this case. Further, the Subordinate Judge did not find that there was any irregularity committed by the official receiver in conducting the sale and the District Judge has definitely found that there was no such irregularity. The only ground on which the Subordinate Judge held that the sale should be set aside was that the price fetched was low. Now if that ground is justified, the Subordinate Judge would have been right in interfering with the sale proposed by the official receiver. That matter has been considered by the District Judge and he has 697 held that there is no reason to hold that the properties were being sold for a low price. The Subordinate Judge in dealing with the question of price has pointed out that the insolvent had valued the properties at Rs. 80,000/ , though he was conscious of the fact that this was properly an exaggeration. He therefore did not hold that the properties were worth Rs. 80,000/ . He came to the conclusion that the properties would be worth at least Rs. 40,000/ and the main reason why he said so was that the properties had been mortgaged for over Rs. 20,000/ in 1936. According to him there seems to be some infallible rule that one must double the mortgaged money in order to arrive at the valuation of the properties mortgaged. The District Judge has pointed out and we think, rightly that there can be no such rule. Therefore, the main basis on which the Subordinate Judge held that the properties were worth Rs. 40,000/ and therefore the bid of the appellant was low, falls to the ground as pointed out by the District Judge. The Subordinate Judge also pointed out that the insolvents were in possession of the properties during the pendency of the insolvency appeal and had been depositing Rs. 2000/ annually on the order of the High Court in order to remain in possession. The Subordinate Judge however did not calculate the value of the properties on the basis that their annual income was Rs. 2,000/ and rightly so because the amount deposited by a litigant on the order of a court in order to retain possession of some property cannot necessarily lead to the inference that was the annual income of the property. It seems therefore that the District Judge was right when he held that there was no evidence on the record which would justify the finding of the Subordinate Judge that the price fetched by the sale in this case was inadequate or unreasonable. We may add that it was open to the respondent to show to the Subordinate Judge by well recognised methods 698 of valuation as to what the value of the properties was. The Subordinate Judge should have then taken into account the total amount of the encumbrance on these properties. The mortgage deed is not on the record and we do not know what interest, if any, the mortgage money carried. Before the Subordinate Judge could come to the conclusion that the price offered by the appellant was low, he had first to find out the price of the properties by some recognised method. He had then to find what was the total amount of encumbrance on the properties. If on finding these things it appeared that the difference between the two was much larger than the price bid by the appellant, the Subordinate Judge would have been justified in interfering with the order of the official receiver, even if there was no question of fraud, collusion or irregularity in the present case. But no such findings have been given by the Subordinate Judge and the District Judge consequently was right when he said that the view of the Subordinate Judge that the price fetched was inadequate and unreasonable is incorrect. Unfortunately, the High Court did not address itself to the question whether the order of the District Judge was according to law or not. It seems to have been impressed by the offer made by the respondent, overlooking the fact that the offer of Rs. 9,000/ as the minimum bid and Rs. 1000/ for the appellant was being made three years after the auction during which, for all that we know, the prices might have risen. Further, the High Court has remarked that the price offered by the appellant was not unconscionably low but it felt that it was still low on a comparison with the offer made by the respondent in 1956. As the High Court did not consider the question whether the order of the District Judge was according to law or not and did not come to the conclusion that order was not according to law, the High Court would have no jurisdiction to interfere with that order. 699 Learned counsel for the respondent urged that even though the High Court may not have considered the matter from this aspect, we should not interfere with the order of the High Court if we are satisfied that in fact the price offered by the appellant was low, in the circumstances prevailing in 1953. We agree that if it was possible for us to come to the conclusion that the price offered by the appellant was low, there would be no reason to interfere with the order of the High Court, even though it might not have considered what was necessary for it to do for interfering under the proviso to section 75; but as are have pointed earlier, there is no sufficient material on the record on which we can say that the price offered by the appellant is low. As we have already pointed out, no attempt was made in the Subordinate Judge 's court to value the properties by any of the well recognised methods by which properties are valued. Further no attempt was made to show the total encumbrance on the property. Unless the valuation was properly made and the encumbrance was found out, it is not possible to say that the offer made by the appellant was low, for that would depend upon the difference between the value of the properties and the amount of encumbrance. In these circumstances, it is not possible for us to say that the order of the District Judge when he held that the Subordinate Judge was not right in holding that the price fetched was inadequate or unreasonable, is not according to law. We therefore allow the appeal, set aside the order of the High Court and restore the order of the District Judge. The appellant will get his costs in this Court from the first respondent. Appeal allowed.

The official receiver put the properties of the insolvents N and his sons for sale, which were subject to mortgage. The properties were ultimately knocked down to the appellant whose bid was the highest. The first respondent made an application under section 68 of the which was allowed by the Subordinate Judge on the ground that the price fetched was very low on appeal under section 75 of the Act the District Judge, inter alia, held that the price fetched was not low. In revision under the proviso to section 75 of the Act, the High Court did not consider whether the order of the District Judge was according to law but accepted an offer made by the first respondent and allowed the revision petition. ^ Held, that the power of the court under section 68 is a judicial power, and must be exercised on well recognised principles, justifying interference with an act of the receiver which he is empowered to do under section 59(a) , and the court must not arbitrarily set aside a sale decided upon by the official receiver, unless there are good judicial grounds to interfere with the discretion exercised by the official receiver, for example that there was fraud or collusion between the receiver and the insolvent or intending purchaser, or the court is of the opinion that there were irregularities in the conduct of the sale which might have affected the price fetched at the sale, or price was low as to justify the Court to hold that the property should not be sold at that price. 691 The High Court had therefore to see whether the Sub Judge 's order was justified on these grounds and whether the District Judge made any mistake in law in reversing that order otherwise the High Court cannot interfere in revision under the proviso to section 75 of the , for the High Court 's jurisdiction to interfere arises only if it is of opinion that the District Judge 's order was not according to law, and only then it can pass such order as it may think fit.

Civil Appeal No. 19 of 1961. Appeal by special leave from the judgment and order dated April 11, 1957, of Bombay High Court, in Special Civil Application No. 3170 of 1956. K. R. Bengeri and A. G. Ratnaparkhi, for the appellant. E. Udayaratnam and section section Shukla, for the respondent. November 29. The Judgment of the Court was delivered by GAJENDRAGADKAR, J. This appeal by special leave arises out of a tenancy case instituted by the appellant against his tenants the respondents in the Court of the Mamlatdar Raver (East Khandesh), in the State of Maharashtra. The property in suit 702 consists of agricultural lands, Survey Nos. 32 and 38, situated in the village Raipur. The respondents had executed a rent note in respect of these lands in favour of the appellant on February 5, 1943. The period for which the rent note was executed was five years and the rent agreed to be paid annually was Rs. 785/ . In ordinary course the lease would have expired on March 31, 1948. However, before the lease expired, on April 11, 1946 the Bombay Tenancy Act, 1939 (Bombay Act XXIX of 1939) was applied to the area of the East Khandesh where the lands are situated, and in consequence as a result of section 23 (1) (b) of the said Act the five years period stipulated in the rent note was statutorily extended to ten years; the result was that under the said statutory provision the rent note in favour of the respondents would have expired on March 31, 1953. During the subsistence of the tenancy thus statutorily extended the Bombay Tenancy and Agricultural Lands Act LXVII of 1948 came into force. This act repealed the earlier Act of 1939 except sections 3, 3(a) and 4 as modified. Sections 5 and 14 (2) of this Act are material. On March 11, 1952 the appellant gave notice to the respondents intimating to them that the period of the rent note executed by them which had been statutorily extended would expire on March 31, 1953 and calling upon them to deliver possession of the lands to him immediately thereafter. Before the notice could be effectively enforced on the expiration of the period of the lease, however, Bombay Act XXXIII of 1952 came into operation on January 12, 1953. This Act repealed section 14(2) and amended section 5 and added sub section (3) to it. Shortly stated the effect of this amendment was that the tenancy of the respondents, who were till then ordinary tenants as distinct from protected tenants, could not be terminated on the expiry of their tenancy except by giving one year 's notice and that too on the ground that the lands were required by 703 the landlord for bona fide personal cultivation and that the income of the said lands would be the main source of income of the landlord. The relevant averments about these grounds had to be made by the landlord in issuing the notice to the tenants for terminating their tenancy. On April 4, 1953 the appellant instituted the present tenancy proceedings for obtaining possession of the lands. The Mamlatdar who tried the proceedings rejected the appellant 's claim on the ground that he had not terminated the tenancy of the respondents as required by law in that he had not given the statutory notice making the prescribed relevant averments in that behalf. The appellant then preferred an appeal against the decision of the Mamlatdar but the appellate authority agreed with the view taken by the Mamlatdar and dismissed his appeal. The dispute was then taken by the appellant before the Bombay Revenue Tribunal by way of a revisional application; and the revisional application succeeded. The Tribunal held that the relevant amendments on which the Mamlatdar and the appellate authority had relied in dismissing the appellant 's claim were not retrospective and that the appellant was entitled to eject the respondents. This order of the Revenue Tribunal was challenged by the respondents by a petition filed by them under article 227 of the Constitution in the Bombay High Court. The High Court has allowed the writ petition and held that the relevant amendments are retrospective in operation and that the appellant is not entitled to eject the respondents. On that view the order passed by the Revenue Tribunal has been set aside and that of the appellate authority restored. It is against this decision that the appellant has come to this Court by special leave. It is necessary at the outset to set out the relevant statutory provisions which fall to be considered in the present appeal. 704 Section 23 (1) (b) of the Bombay Tenancy Act of 1939 which statutorily extended the original contractual five years period of the lease to ten years reads thus: "Every lease subsisting on the said date (that is to say the date on which section 23 came into force) or made after the said date in respect of any land in such area shall be deemed to be for a period of not less than ten years". We have already noticed that as soon as this act was made applicable to the area where the lands in question are situated the original period of five years agreed to between the parties for the duration of the lease was statutorily extended to ten years. Then followed the Tenancy Act LXVII of 1948. Section 5 of the said Act originally stood thus: "5. (1) No tenancy of any land shall be for a period of less than ten years. Notwithstanding any agreement, usage or law to the contrary, no tenancy shall be terminated before the expiry of a period of ten years except on the grounds mentioned in section 14: Provided that any tenancy may be terminated by a tenant before the expiry of a period of ten years by surrendering his interest as a tenant in favour of the landlord. " Section 14, sub section (2) which is relevant reads thus: "In the case of tenant, the duration of whose tenancy is for a period of ten years or more, the tenancy shall terminate at the expiration of such period, unless the landlord has by the acceptance of rent or by any other act or conduct of his allowed the tenant to hold over within the meaning of Section 116 of the ." On January 12, 1953, the amending Act XXXIII of 1952 came into force. By this amending Act 705 the following proviso was added to sub section (1) of section 5: "Provided that at the end of the said period and thereafter at the end of each period of ten years in succession, the tenancy shall, subject to the provisions of Sub Sections (2) and (3), be deemed to be renewed for a further period of ten years on the same terms and conditions notwithstanding any agreement to the contrary." The said amending Act repealed section 14 (2) of Act LXVII of 1948 and amended section 5, sub section (2) in this way: "The landlord may, by giving the tenant one year 's notice in writing before the end of each of the periods referred to in Sub Section (1), terminate the tenancy, with effect from the thirty first day of March in the last year of each of the said period, if he bona fide requires the land for any of the purposes specified in Sub Section (1) of Section 34, but subject to the provisions of Sub Section (2) and (2A) of the said Section, as if such tenant was a protected tenant." A new sub section, sub section (3) was added to section 5. This new sub section reads thus: "Notwithstanding anything contained in sub section (1) (a) every tenancy shall, subject to the provisions of sections 24 and 25, be liable to be terminated at any time on any of the grounds mentioned in section 14; and (b) a tenant may terminate the tenancy at any time by surrendering his interest as a tenant in favour of the landlord: Provided that such surrender shall be in writing and shall be verified before the Mamlatdar in the prescribed manner. " 706 It is common ground that if the provisions of the amending Act XXXIII of 1952 are applicable to the present proceedings the appellant would not be entitled to claim the ejectment of the respondents because he has not given any notice in that behalf as prescribed by the said relevant provisions of the amending statute. His case, however, is that the technical requirements of a valid notice prescribed by the amending Act do not apply to his claim inasmuch as the relevant provisions of the amending Act are not retrospective in operation. According to him he has already given notice to the respondents on March 11, 1952, intimating to them unequivocally his intention to eject them from the lands on the expiration of the ten year period of the lease. The High Court has held that this contention is not well founded and so the appellant 's claim for ejectment has been dismissed. The question which arises for our decision is whether the appellant is entiled to eject the respondents even without complying with the statutory requirement as to the valid notice prescribed by the amending Act XXXIII of 1952. It would be noticed that though the lease originally was for five years, before the five years expired the duration of the lease was statutorily extended to ten years by virtue of the provisions of section 23(1)(b) of Act XXIX of 1939. A somewhat similar, though from the point of view of the appellant a more revolutionary, result followed when a proviso was added to section 5(1) by the amending Act XXXIII of 1952. By virtue of this amendment the period of the lease gets automatically extended for ten years from time to time. In other words, before the lease in favour of the respondents could expire on March 31, 1953, by virtue of the proviso to section 5(1) of the amending Act of 1952 it got extended for ten years, and unless it is terminated by a valid notice or a surrender 707 is made by the tenant as specified by the statute the tenancy would be extended from time to time at every stretch for ten years. Therefore, there can be no doubt that as a result of the amending Act of 1952 the expiration of the lease did not take place on March 31, 1953 as had been anticipated by the appellant when he gave notice on March 11, 1952. In one sense the amending Act which is undoubtedly a piece of beneficent legislation conferred on the respondents additional rights and these additional rights were conferred on them before the lease in their favour had come to an end. In order to put an end to the tenancy thus statutorily safeguarded the appellant has to follow the course prescribed by the amending statute and give a valid notice as required by the said statute. Just as the appellant could not have complained against the extension of the original period of five years to ten years by Act XXIX of 1939 so he cannot complain against the further extensions statutorily granted to the respondents by section 5(1) of the amending Act XXXIII of 1952. That is one aspect of the matter. Besides, it is necessary to bear in mind that the right of the appellant to eject the respondents would arise only on the termination of the tenancy and in the present case it would have been available to him on March 31, 1953 if the statutory provision had not in the meanwhile extended the life of the tenancy. It is true that the appellant gave notice to the respondents on March 11, 1952 as he was then no doubt entitled to do; but his right as a landlord to obtain possession did not accrue merely on the giving of the notice, it accrued in his favour on the date when the lease expired. It is only after the period specified in the notice is over and the tenancy has in fact expired that the landlord gets a right to eject the tenant and obtain possession of the land. Considered from this 708 point of view, before the right accrued to the appellant to eject the respondents amending Act XXXIII of 1952 stepped in and deprived him of that right by requiring him to comply with the statutory requirement as to a valid notice which has to be given for ejecting tenants. In this connection it is relevant to distinguish between an existing right and a vested right. Where a statute operates in future it cannot be said to be retrospective merely because within the sweep of its operation all existing rights are included. As observed by Buckley, L. J. in West vs Gwynne retrospective operation is one matter and interference with existing rights is another. "If an Act provides that as at a past date the law shall be taken to have been that which it was not that Act I understand to be retrospective. That is not this case. The question here is whether a certain provision as to the contents of leases is addressed to the case of all leases or only of some, namely, leases executed after the passing of the Act. The question is as to the ambit and scope of the Act, and not as to the date as from which the new law, as enacted by the Act, is to be taken to have been the law. " These observations were made in dealing with the question as to the retrospective construction of section 3 of the Conveyancing and Law of Property Act, 1892 (55 & 56 Vict. c. 13). In substance section 3 provided that in all leases containing a covenant, condition or agreement against assigning, underletting, or parting with the possession, or disposing of the land or property leased without licence or consent, such covenant, condition or agreement shall, unless the lease contains an expressed provision to the contrary, be deemed to be subject to a proviso to the effect that no fine or sum of money in the nature of a fine shall be payable for or in respect of such licence or consent. It was held that the provisions of 709 the said section applied to all leases whether executed before or after the commencement of the Act; and, according to Buckley, L. J., this construction did not make the Act retrospective in operation; it merely affected in future existing rights under all leases whether executed before or after the date of the Act. The position in regard to the operation of section 5(1) of the amending Act with which we are concerned appears to us to be substantially similar. A similar question had been raised for the decision of this Court in Jivabhai Purshottam vs Chhagan Karson in regard to the retrospective operation of section 34(2)(a) of the said amending Act XXXIII of 1952 and this Court has approved of the decision of the full Bench of the Bombay High Court on that point in Durlabbhai Fakirbhai vs Jhaberbhai Bhikabhai. It was held in Durlabbhai 's case that the relevant provision of the amending Act would apply to all proceedings where the period of notice had expired after the amending Act had come into force and that the effect of the amending Act was no more than this that it imposed a new and additional limitation on the right of the landlord to obtain possession from his tenant. It was observed in that judgment that "a notice under section 34(1) is merely a declaration to the tenant of the intention of the landlord to terminate the tenancy; but it is always open to the landlord not to carry out his intention. Therefore, for the application of the restriction under sub section 2(A) on the right of the landlord to terminate the tenancy, the crucial date is not the date of notice but the date on which the right to terminate matures; that is the date on which the tenancy stands terminated". Mr. Bengeri, for the appellant, fairly conceded that the decision of this Court in Jivabhai 's case was against his contention but he purported to rely 710 on another decision of this Court in Sakharam alias Bapusaheb Narayan Sanas vs Manikchand Motichand Shah. In that case the Court was called upon to consider the question as to whether the provisions of section 88 of Bombay Act LXVII of 1948 were retrospective in operation or not, and it has been held that the said provisions are prospective. However, we do not think that the position with regard to the provisions contained in section 88 can be said to be analogous or similar to the position with regard to the relevant provisions of the amending Act XXXIII of 1952 with which we are concerned in the present appeal. Therefore, we do not think that Mr. Bengeri can make any effective use of the said decision. In the result the appeal fails and is dismissed with costs. Appeal dismissed.

In February 1943 the appellant leased out an agricultural land for 5 years to the respondent. Before the expiry of the lease, the Bombay Tenancy Act, 1939, was made applicable to the area where the land was situated, and under section 23(1)(b) the period of the lease was statutorily extended to 10 years. During the subsistence of the tenancy thus statutorily extended, the Bombay Act 67 of 1948 came into force. In March 1952 the appellant gave notice to the respondents intimating that the statutory period of tenancy expired on 31st March 1953, and called upon them to deliver possession immediately thereafter. Before the notice could effectively be enforced the Bombay Act 33 of 1952 came into force, the effect of which was that the lease was automatically extended for 10 years from time to time, unless terminated by giving one year 's notice with the averment that the land was required bona fide by the landlord for personal cultivation and that income would be the main source of income to the landlord. The appellant 's case was that the technical requirements of a valid notice prescribed by the Amending Act do not apply to his claim inasmuch as the relevant provisions of the amending Act are not retrospective in operation. The question was whether the appellant was entitled to eject the respondents even without complying with the statutory requirement as to valid notice prescribed by the Amending Act 33 of 1952. ^ Held, that by virtue of the Amending Act 33 of 1952 the period of lease was automatically extended for a period of ten years from time to time, unless terminated by a valid 701 notice or a surrender was made by the tenant as specified by the statute, otherwise the tenancy would be extended from time to time at a stretch of every ten years. In order to put an end to the tenancy, thus statutorily safe guarded, the landlord had to follow the course prescribed by the amending statute to give a valid notice as required by the said statute. The right of a landlord to obtain possession does not accrue merely on the giving of the notice, it accrues in his favour on the date when the lease expires. It is only after the period specified in the notice is over and the tenancy in fact had expired that the landlord gets a right to eject the tenant and take possession of land. Held, further, that there is distinction between existing right and vested right. Where a statute operates in future it cannot be said to be retrospective merely because within the sweep of its operation all existing rights are included. The operation of section 5(1) of the Amending Act is not retrospective, it merely affects in future the existing rights under all leases whether executed before or after the date of the Act. vs Gwynne, [191I] 2 Ch. 1, Durlabhai Fakirbhai vs Jhaverbhai Bhikabhai, (1955) 58 Bom. L. R. 85, applied. Jivabhai Purshottam vs Chhagan Karson, [1962]1 section C. R. 568, referred to.

ION: Criminal Appeal No. 195 of 1960. Appeal by special leave from the judgment and order dated March 11, 1960, of the Bombay High Court in Criminal Jury Reference No. 159 of 1959. G. section Pathak, section G. Patwardhan, Rajini Patel, Porus A. Metha, J. B. Dadachaji, Ravinder Narain and O. C. Mathur, for the appellant. M. C. Setalvad, Attorney General of India, C. M. Trivedi, V. H. Gumeshte, B. R. G. K. Achar and R. H. Dhebar, for the respondent. November 24. The Judgment of the Court was delivered by SUBBA RAO, J. This appeal by special leave arises out of the judgment of the Bombay High Court sentencing Nanavati, the appellant, to life imprisonment for the murder of Prem Bhagwandas Ahuja, a businessman of Bombay. 573 This appeal presents the commonplace problem of an alleged murder by an enraged husband of a paramour of his wife: but it aroused considerable interest in the public mind by reason of the publicity it received and the important constitutional point it had given rise to at the time of its admission. The appellant was charged under section 302 as well as under section 304, Part I, of the Indian Penal Code and was tried by the Sessions Judge, Greater Bombay, with the aid of special jury. The jury brought in a verdict of "not guilty" by 8: 1 under both the sections; but the Sessions Judge did not agree with the verdict of the jury, as in his view the majority verdict of the jury was such that no reasonable body of men could, having regard to the evidence, bring in such a verdict. The learned Sessions Judge submitted the case under section 307 of the Code of Criminal Procedure to the Bombay High Court after recording the grounds for his opinion. The said reference was heard by a division bench of the said High Court consisting of Shelat and Naik, JJ. The two learned Judges gave separate judgments, but agreed in holding that the accused was guilty of the offence of murder under section 302 of the Indian Penal Code and sentenced him to undergo rigorous imprisonment for life. Shelat, J., having held that there were misdirections to the jury, reviewed the entire evidence and came to the conclusion that the accused was clearly guilty of the offence of murder, alternatively, he expressed the view that the verdict of the jury was perverse, unreasonable and, in any event, contrary to the weight of evidence. Naik, J., preferred to base his conclusion on the alternative ground, namely, that no reasonable body of persons could have come to the conclusion arrived at by the jury. Both the learned Judges agreed that no case had been made out to reduce the offence from murder to culpable 574 homicide not amounting to murder. The present appeal has been preferred against the said conviction and sentence. The case of the prosecution may be stated thus: This accused, at the time of the alleged murder, was second in command of the Indian Naval Ship "Mysore". He married Sylvia in 1949 in the registry office at Portsmouth, England. They have three children by the marriage, a boy aged 9 1/2 years a girl aged 5 1/2 years and another boy aged 3 years. Since the time of marriage, the couple were living at different places having regard to the exigencies of service of Nanavati. Finally, they shifted to Bombay. In the same city the deceased Ahuja was doing business in automobiles and was residing, along with his sister, in a building called "Shreyas" till 1957 and thereafter in another building called "Jivan Jyot" in Setalvad Road. In the year 1956, Agniks, who were common friends of Nanavatis and Ahujas, introduced Ahuja and his sister to Nanavatis. Ahuja was unmarried and was about 34 years of age at the time of his death, Nanavati, as a Naval Officer, was frequently going away from Bombay in his ship, leaving his wife and children in Bombay. Gradually, friendship developed between Ahuja and Sylvia, which culminated in illicit intimacy between them. On April 27, 1959, Sylvia confessed to Nanavati of her illicit intimacy with Ahuja. Enraged at the conduct of Ahuja, Nanavati went to his ship, took from the stores of the ship a semi automatic revolver and six cartridges on a false pretext, loaded the same, went to the flat of Ahuja entered his bed room and shot him dead. Thereafter, the accused surrendered himself to the police. He was put under arrest and in due course he was committed to the Sessions for facing a charge under section 302 of the Indian Penal Code. The defence version, as disclosed in the Statement made by the accused before the Sessions Court under section 342 of the Code of Criminal Procedure and 575 his deposition in the said Court, may be briefly stated: The accused was away with his ship from April 6, 1959, to April 18, 1959. Immediately after returning to Bombay, he and his wife went to Ahmednagar for about three days in the company of his younger brother and his wife. Thereafter, they returned to Bombay and after a few days his brother and his wife left them. After they had left, the accused noticed that his wife was behaving strangely and was not responsive or affectionate to him. When questioned, she used to evade the issue. At noon on April 27, 1959, when they were sitting in the sitting room for the lunch to be served, the accused put his arm round his wife affectionately, when she seemed to go tense and unresponsive. After lunch, when he questioned her about her fidelity, she shook her head to indicate that she was unfaithful to him. He guessed that her paramour was Ahuja. As she did not even indicate clearly whether Ahuja would marry her and look after the children, he decided to settle the matter with him. Sylvia pleaded with him not go to Ahuja 's house, as he might shoot him. Thereafter, he drove his wife, two of his children and a neighbour 's child in his car to a cinema, dropped them there and promised to come and pick them up at 6 P.M. when the show ended. He then drove his car to his ship, as he wanted to get medicine for his sick dog, he represented to the authorities in the ship, that he wanted to draw a revolver and six rounds from the stores of the ship as he was going to drive alone to Ahmednagar by night, though the real purpose was to shoot himself. On receiving the revolver and six cartridges, and put it inside a brown envelope. Then he drove his car to Ahuja 's office, and not finding him there, he drove to Ahuja 's flat, rang the door bell, and, when it was opened by a servant, walked to Ahuja 's bed room, went into the bed room and shut the door behind him. He also carried with him the envelope containing 576 the revolver. The accused saw the deceased inside the bed room, called him a filthy swine and asked him whether he would marry Sylvia and look after the children. The deceased retorted, "Am I to marry every woman I sleep with ?" The accused became enraged, put the envelope containing the revolver on a cabnit nearby, and threatened to thrash the deceased. The deceased made a sudden move to grasp at the envelope, when the accused whipped out his revolver and told him to get back. A struggle ensued between the two and during that struggle two shots went off accidentally and hit Ahuja resulting in his death. After the shooting the accused went back to his car and drove it to the police station where he surrendered himself. This is broadly, omitting the details, the case of the defence. It would be convenient to dispose of at the outset the questions of law raised in this case. Mr. G. S Pathak, learned counsel for the accused, raised before us the following points: (1) Under section 307 of the Code of Criminal Procedure, the High Court should decide whether a reference made by a Sessions Judge was competent only on a perusal of the order of reference made to it and it had no jurisdiction to consider the evidence and come to a conclusion whether the reference was competent or not. (2) Under section 307(3) of the said Code, the High Court had no power to set aside the verdict of a jury on the ground that there were misdirections in the charge made by the Sessions Judge. (3) I here were no misdirections at all in the charge made by the Sessions Judge; and indeed his charge was fair to the prosecution as well to the accused. (4) The verdict of the jury was not perverse and it was such that a reasonable body of persons could arrive at it on the evidence placed before them. (5) In any view, the accused shot at the deceased under grave and sudden provocation, and therefore even if he had committed 577 an offence, it would not be murder but only culpable homicide not amounting to murder. Mr. Pathak elaborates his point under the first heading thus: Under section 307 of the Code of Criminal Procedure, the High Court deals with the reference in two stages. In the first stage, the High Court has to consider, on the basis of the referring order, whether a reasonable body of persons could not have reached the conclusion arrived at by the jury; and, if it is of the view that such a body could have come to that opinion the reference shall be rejected as incompetent. At this stage, the High Court cannot travel beyond the order of reference, but shall confine itself only to the reasons given by the Sessions Judge. If, on a consideration of the said reasons, it will of the view that no reasonable body of persons could have come to that conclusion, it will then have to consider the entire evidence to ascertain whether the verdict of the jury is unreasonable. If the High Court holds that the verdict of the jury is not unreasonable, in the case of a verdict of "not guilty", the High Court acquits the accused, and in the case where the verdict is one of "guilty" it convicts the accused. In case the High Court holds that the verdict of "not guilty", is unreasonable, it refers back the case to the Sessions Judge, who convicts the accused; thereafter the accused will have a right of appeal wherein he can attack the validity of his conviction on the ground that there were misdirections in the charge of the jury. So too, in the case of a verdict of "guilty" by the jury, the High Court, if it holds that the verdict is unreasonable, remits the matter to the Sessions Judge, who acquits the accused, and the State, in an appeal against that acquittal, may question the correctness of the said acquittal on the ground that the charge to the jury was vitiated by misdirections. In short, the argument may be put in three propositions, namely, (i) the High Court rejects the 578 reference as incompetent, if on the face of the reference the verdict of the jury does not appear to be unreasonable, (ii) if the reference is competent, the High Court can consider the evidence to come to a definite conclusion whether the verdict is unreasonable or not, and (iii) the High Court has no power under section 307 of the Code of Criminal Procedure to set aside the verdict of the jury on the ground that it is vitiated by misdirections in the charge to the jury. The question raised turns upon the construction of the relevant provisions of the Code of Criminal Procedure. The said Code contains two fascicule of sections dealing with two different situations. Under section 268 of the Code, "All trials before a Court of Session shall be either by jury, or by the Judge himself." Under section 297 thereof: "In cases tried by jury, when the case for the defence and the prosecutor 's reply, if any, are concluded, the Court shall proceed to charge the jury, summing up the evidence for the prosecution and defence, and laying down the law by which the jury are to be guided . . . ". Section 298 among other imposes a duty on a judge to decide all questions of law arising in the course of the trial, and especially all questions as to the relevancy of facts which it is proposed to be proved, and the admissibility of evidence or the propriety of questions asked by or on behalf of the parties, and to decide upon all matters of fact which it is necessary to prove in order to enable evidence of particular matter to be given. It is the duty of the jury "to decide which view of the facts is true and then to return the verdict which under such view ought, according to the directions of the Jury, to be returned. " After the charge to the jury, the jury retire to consider their verdict and, after due consideration, the foreman of the jury informs the Judge what is their verdict or what is the verdict of the majority of the jurors. 579 Where the Judge does not think it necessary to disagree with the verdict of the jurors or of the majority of them, he gives judgment accordingly. If the accused is acquitted, the Judge shall record a verdict of acquittal; if the accused is convicted, the Judge shall pass sentence on him according to law. In the case of conviction, there is a right of appeal under section 410 of the Code, and in a case of acquittal, under section 417 of the Code, to the High Court. But section 418 of the Code provides: "(1) An appeal may lie on a matter of fact as well as a matter of law except where the trial was by jury, in which case the appeal shall lie on a matter of law only. " Sub section (2) therefore provides for a case of a person sentenced to death, with which we are not now concerned. Section 423 confers certain powers on an appellate Court in the matter of disposing of an appeal, such as calling for the record, hearing of the pleaders, and passing appropriate orders therein. But sub section (2) of section 423 says: "Nothing herein contained shall authorise the Court to alter or reverse the verdict of the jury, unless it is of opinion that such verdict is erroneous owning to a misdirection by the Judge, or to a misunderstanding on the part of the jury of the law as laid down by him. " It may be noticed at this stage, as it will be relevant in considering one of the arguments raised in this case, that sub section (2) does not confer any power on an appellate court, but only saves the limitation on the jurisdiction of an appellate court imposed under section 418 of the Code. it is, therefore, clear that in an appeal against conviction or acquittal in a jury trial, the said appeal is confined only to a matter of law. The Code of Criminal Procedure also provides for a different situation. The Sessions Judge may 580 not agree with the verdict of the jurors or the majority of them; and in that event section 307 provides for a machinery to meet that situation. As the argument mainly turns upon the interpretation of the provisions of this section, it will be convenient to read the relevant clauses thereof. Section 307: (1) If in any such case the Judge disagrees with the verdict of the jurors, or of a majority of jurors, on all or any of the charges on which any accused person had been tried, and is clearly of opinion that it is necessary for the ends of justice to submit the case in respect of such accused person to the High Court, he shall submit the case accordingly, recording the grounds of his opinion, and, when the verdict is one of acquittal, stating the offence which he considers to have been committed, and in such case, if the accused is further charged under the provisions such charge as if such verdict had been one of conviction. (3) In dealing with the case so submitted the High Court may exercise any of the powers which it may exercise on an appeal, and subject thereto it shall, after considering the entire evidence and after giving due weight to the opinions of the Sessions Judge and the jury, acquit or convict such accused of any offence of which the jury could have convicted him upon the charge framed and placed before it; and, if it convicts him, may pass such sentence as might have been passed by the Court of Session. This section is a clear departure from the English law. There are good reasons for its enactment. Trial by jury outside the Presidency Towns was first introduced in the Code of Criminal Procedure of 1861, and the verdict of the jury was, 581 subject to re trial on certain events, final and conclusive. This led to miscarriage of justice through jurors returning erroneous verdicts due to ignorance and inexperience. The working of the system was reviewed in 1872, by a committee appointed for that purpose and on the basis of the report of the said Committee, section 262 was introduced in the Code of 1872. Under that section, where there was difference of view between the jurors and the judge, the Judge was empowered to refer the case to the High Court in the ends of justice, and the High Court dealt with the matter as an appeal. But in 1882 the section was amended and under the amended section the condition for reference was that the High Court should differ from the jury completely; but in the Code of 1893 the section was amended practically in terms as it now appears in the Code. The history of the legislation shows that the section was intended as a safeguard against erroneous verdicts of inexperienced furors and also indicates the clear intention of the Legislature to confer on a High Court a separate jurisdiction, which for convenience may be described as "reference jurisdiction". Section 307 of the Code of Criminal Procedure, while continuing the benefits of the jury system to persons tried by a Court of Session, also guards against any possible injustice, having regard to the conditions obtaining in India. It is, therefore clear that there is an essential difference between the scope of the jurisdiction of the High Court in disposing of an appeal against a conviction or acquittal, as the case may be, in a jury trial, and that in a case submitted by the Sessions Judge when he differs from the verdict of the jury: in the former the acceptance of the verdict of the jury by the sessions Judge is considered to be sufficient guarantee against its perversity and therefore an appeal is provided only on questions of law, whereas in the latter the absence of such agreement necessitated the conferment of a larger power on 582 the High Court in the matter of interfering with the verdict of the jury. Under section 307(1) of the Code, the obligation cast upon the Sessions Judge to submit the case to the High Court is made subject to two conditions, namely, (1) the Judge shall disagree with the verdict of the jurors, and (2) he is clearly of the opinion that it is necessary in the ends of justice to submit the case to the High Court. If the two conditions are complied with, he shall submit the case, recording the grounds of his opinion. The words "for the ends of justice" are comprehensive, and coupled with the words "is clearly of opinion", they give the Judge a discretion to enable him to exercise his power under different situations, the only criterion being his clear opinion that the reference is in the ends of justice. But the Judicial Committee, in Ramanugrah Singh vs King Emperor(1), construed the words "necessary for the ends of justice" and laid down that the words mean that the Judge shall be of the opinion that the verdict of the jury is one which no reasonable body of men could have reached on the evidence. Having regard to that interpretation, it may be held that the second condition for reference is that the Judge shall be clearly of the opinion that the verdict is one which no reasonable body of men could have reached on the evidence. It follows that if a Judge differs from the jury and is clearly of such an opinion, he shall submit the case to the High Court recording the grounds of his opinion. In that event, the said reference is clearly competent. If on the other hand, the case submitted to the High Court does not ex facie show that the said two conditions have been complied with by the Judge, it is incompetent. The question of competency of the reference does not depend upon the question whether the Judge 583 is justified in differing from the jury or forming such an opinion on the verdict of the jury. The argument that though the Sessions Judge has complied with the conditions necessary for making a references, the High Court shall reject the reference as incompetent without going in to the evidence if the reasons given do not sustain the view expressed by the Sessions Judge, is not supported by the provisions of sub section (1) of section 307 of the Code. But it is said that it is borne out of the decision of the Judicial Committee in Ramanugrah Singh 's case(1). In that case the Judicial Committee relied upon the words "ends of justice" end held that the verdict was one which no reasonable body of men could have, reached on the evidence and further laid down that the requirements of the ends of justice must be the determining factor both for the Sessions Judge in making the reference and for the High Court in disposing of it. The Judicial Committee observed: "In general, if the evidence is such that it can properly support a verdict either of guilty or not guilty, according to the view taken of it by the trial court, and if the jury take one view of the evidence and the judge thinks that they should have taken the other, the view of the jury. must prevail, since they are the judges of fact. In such a case a reference is not justified, and it is only by accepting their view that the High Court can give due weight to the opinion of the jury. If, however, the High Court considers that on the evidence no reasonable body of men could have reached the conclusion arrived at by the jury, then the reference was justified and the ends of justice require that the verdict be disregarded. " The Judicial Committee proceeded to state: "In their Lordships ' opinion had the High Court approached the reference on the right 584 lines and given due weight to the opinion of the jury they would have been bound to hold that the reference was not justified and that the ends of justice did not require any interference with the verdict of the jury." Emphasis is laid on the word "justified", and it is argued that the High Court should reject the reference as incompetent if the reasons given by the Sessions Judge in the statement of case do not support his view that it is necessary in the ends of justice to refer the case to the High Court. The Judicial Committee does not lay down any such proposition. There, the jury brought in a verdict of not "guilty" under section 302, Indian Penal Code. The Sessions Judge differed from the jury and made a reference to the High Court. The High Court accepted the reference and convicted the accused and sentenced him to transportation for life. The Judicial Committee held, on the facts of that case, that the High Court was not justified in the ends of justice to interfere with the verdict of the jury. They were not dealing with the question of competency of a reference but only with that of the justification of the Sessions Judge in making the reference, and the High Court in accepting it. It was also not considering a case of any disposal of the reference by the High Court on the basis of the reasons given in the reference, but were dealing with a case where the High Court on a consideration of the entire evidence accepted the reference and the Judicial Committee held on the evidence that there was no justification for the ends of justice to accept it. This decision, therefore, has no bearing on the competency of a reference under section 307(1) of the Code of criminal Procedure. Now, coming to sub section (3) of section 307 of the Code, it is in two parts. The first part says that the High Court may exercise any of the powers which it may exercise in an appeal. Under the 585 second part, after considering the entire evidence and after giving due weight to the opinions of the Sessions Judge and the jury, the High Court shall acquit or convict the accused. These parts are combined by the expression and subject thereto". The words "subject thereto" were added to the section by an amendment in 1896. This expression gave rise to conflict of opinion and it is conceded that it laces clarity. That may be due to the fact that piecemeal amendments have been made to the section from time to time to meet certain difficulties. But we cannot ignore the expression, but we must give it a reasonable construction consistent with the intention of the Legislature in enacting the said section. Under the second part of the section, special jurisdiction to decide a case referred to it is conferred on the High Court. It also defined the scope of its jurisdiction and its limitations The High Court can acquit or convict an accused of an offence of which the jury could have convicted him, and also pass such sentence as might have been passed by the Court of Session. But before doing so, it shall consider the entire evidence and give due weight to the opinions of the Sessions Judge and the jury. The second part does not confer on the High Court any incidental procedural powers necessary to exercise the said jurisdiction in a case submitted to it, for it is neither an appeal nor a revision. The procedural powers are conferred on the High Court under the first part. The first part enables the High Court to exercise any of the powers which it may exercise in appeal, for without such powers it cannot exercise its jurisdiction effectively. But the expression "subject to" indicates that in exercise of its jurisdiction in the manner indicated by the second part, it can call in aid only any of the powers of an appellate court, but cannot invoke a power other than that conferred on an appellate court. The limitation on the second part implied in the expression "subject", must 586 be confined to the area of the procedural powers conferred on a appellate court. If that be the construction, the question arises, how to reconcile the provisions of section 423 (2) with those of section 307 of the Code ? Under sub section (2) of section 423: "Nothing herein contained shall authorise the Court to alter or reverse the verdict of a jury, unless it is of opinion that such verdict is erroneous owing to a misdirection by the Judge, or to a misunderstanding on the part of the jury of the law as laid down by him. " It may be argued that, as an appellate court cannot alter or reverse the verdict of a jury unless such a verdict is erroneous owing to a misdirection by the Judge, or to a misunderstanding on the part of the jury of the law as laid down by him, the High Court, in exercise of its jurisdiction under section 307 of the Code, likewise could not do so except for the said reasons. Sub section (2) of section 423 of the Code does not confer any power of the High Court; it only restates the scope of the limited jurisdiction conferred on the could under section 418 of the Code, and that Could not have any application to the special jurisdiction conferred on the High Court under section 307. That apart, a perusal of the provisions of section 423 (1) indicates that there are powers conferred on an appellate court which cannot possibly be exercised by courts disposing of reference under section 307 of the Code, namely, the power to order commitment etc. Further section 423 (1) (a) and (b) speak of conviction, acquittal, finding and sentence, which are wholly inappropriate to verdict of a jury. Therefore, a reasonable construction will be that the High Court can exercise any of the powers conferred on an appellate court under section 423 or under either sections of the Code which are appropriate to the disposal of a, reference under section 307. The object is to prevent miscarriage of the justice by the jurors returning erroneous 587 or preverse verdict. The opposite construction defeats this purpose, for it equates the jurisdiction conferred under section 307 with that of an appellate court in a jury trial. That construction would enable the High Court to correct an erroneous verdict of a jury only in a case of misdirection by the Judge but not in a case affair and good charge. This result effaces the distinction between the two types of jurisdiction. Indeed, learned counsel for the appellant has taken a contrary position. He would say that the High Court under section 307 (3) could not interfere with the verdict of the jury on the ground that there were misdirections in the charge to the jury. This argument is built upon the hypothesis that under the Code of criminal Procedure there is a clear demarcation of the functions of the jury and the Judge, the jury dealing with facts and the Judge with the and therefore the High Court could set aside a verdict on the ground of misdirection only when an appeal comes to it under section 418 and could only interfere with the verdict of the jury for the ends of justice, as interpreted by the Privy Council, when the matter comes to it under 8. 307 (3). If this interpretation be accepted, we would be attributing to the Legislature an intention to introduce a circuitous method and confusion in the disposal of criminal cases. The following illustration will demonstrate the illogical result of the argument. The jury brings in a verdict of "guilty" on the basis of a charge replete with misdirections; the Judge disagrees with that verdict and states the case to the High court; the High Court holds that the said verdict is not erroneous on the basis of the charge, but is of the opinion that the verdict is erroneous because of the misdirections in the charge; even so, it shall hold that the verdict of the jury is good and reject the reference thereafter, the Judge his to accept the verdict and acquit the accused; the prosecution then will have 588 to prefer an appeal under section 417 of the Code on the ground that the verdict was induced by the misdirections in the charge. This could not have been the intention of the Legislature. Take the converse case. On similar facts, the jury brings in a verdict of guilty"; the Judge disagrees with the jury and makes a reference to the High Court; even though it finds misdirections in the charge to the jury, the High Court cannot set aside the conviction but must reject the reference; and after the conviction, the accused may prefer an appeal to the High Court. This procedure will introduce confusion in jury trials, introduce multiplicity of proceedings, and attribute ineptitude to the Legislature. What is more, this construction is not supported by the express provisions of section 307 (3) of the Code. The said sub section enables the High Court to consider the entire evidence, to give due weight to the opinions of the Sessions Judge and the jury, and to acquit or convict the accused. The key words in the sub section are "giving due weight to the opinions of the Sessions Judge and the jury". The High Court shall give weight to the verdict of the jury; but the weight to be given to a verdict depends upon many circumstances it may be one that no reasonable body of persons could come to; it may be a perverse verdict; it may be a divided verdict and may not carry the same weight as the united one does; it may be vitiated by misdirections or non directions. How can a Judge give any weight to a verdict if it is induced and vitiated by grave misdirections in the charge ? That apart, the High Court has to give due weight to the opinion of the Sessions Judge. The reasons for the opinion of the Sessions Judge are disclosed in the case submitted by him to the High Court. If the case stated by the sessions Judge disclosed that there must have been misdirections the charge, how. can the High Court ignore them in giving due weight to his 589 opinion ? What is more, the jurisdiction of the High Court is couched in very wide terms in sub section (3) of section 307 of the Code: it can acquit or convict an accused. It shall take into consideration the entire evidence in the case; it shall give due weight to the opinions of the Judge and the jury; it combines in itself the functions of the Judge and jury; and it is entitled to come to its independent opinion. The phraseology used does not admit of an expressed or implied limitation on the jurisdiction of the High Court. It appears to us that the Legislature designedly conferred a larger power on the High Court under section 307(3) of the code than that conferred under section 418 thereof, as in the former case the Sessions Judge differs from the jury while in the latter he agrees with the jury. The decisions cited at the Bar do not in any way sustain in narrow construction sought to be placed by learned counsel on section 307 of the code. In Ramanugrah Singh 's case (1), which have been referred to earlier, the Judicial Committee described the wide amplitude of the power of the High Court in the following terms: "The Court must consider the whole case and give due weight to the opinions of the Sessions Judge and jury, and than acquit or convict the accused." The Judicial Committee took care to observe: ". the test of reasonableness on the part of the jury may not be conclusive in every case. It is possible to suppose a case in which the verdict was justified on the evidence placed before the jury, but in the light of further evidence placed before the High Court the verdict is shown to be wrong. In such case the ends of justice would 590 require the verdict to be set aside though the jury had not acted unreasonably." This passage indicates that the Judicial Committee did not purport to lay down exhaustively the circumstances under which the High Court could interfere under the said sub section with the verdict of the jury. This Court in Akhlakali Hayatalli vs The State of Bombay accepted the view of the Judicial Committee on the construction of section 307 of the Code of Criminal Procedure, and applied it to the facts of that case. But the following passage of this Court indicates that it also does not consider the test of reasonableness as the only guide in interfering with the verdict of the jury: "The charge was not attacked before the High court nor before us as containing any misdirections or non directions to the jury such as to vitiate the verdict. " This passage recognizes the possibility of interference by the High Court with the verdict of the jury under the said sub section if the verdict is vitiated by misdirections or non directions. So too the decision of this court in Ratan Rai vs State of Bihar assumes that such an interference is permissible if the verdict of the jury was vitiated by misdirections. In that case, the appellants were charged under sections 435 and 436 of the Indian Penal Code and were tried by a jury, who returned a majority verdict of "guilty". The Assistant Sessions Judge disagreed with the said verdict and made a reference to the High Court. At the hearing of the reference to counsel for the appellants contended that the charge to the jury was defective, and did not place the entire evidence before the Judges. The learned Judges of the High Court considered the objections as such and nothing more, and found the appellants guilty and convicted them. This Court, observing that it was incumbent on the High 591 Court to consider the entire evidence and the charge as framed and placed before the jury and to come to its own conclusion whether the evidence was such that could properly support the verdict of guilty against the appellants, allowed the appeal and remanded the matter to the High Court for disposal in accordance with the provisions of section 307 of the Code of Criminal Procedure. This decision also assumes that a High Court could under section 307 (3) of the Code of Criminal Procedure interfere with the verdict of the Jury, if there are misdirections in the charge and holds that in such a case it is incumbent on the court to consider the entire evidence and to come to its own conclusion, after giving due weight to the opinions of the Sessions Judge, and the verdict of the jury. This Court again in Sashi Mohan Debnath vs The State of West Bengal, held that where the Sessions Judge disagreed with the verdict of the jury and was of the opinion that the case should be submitted to the High Court, he should submit the whole case and not a part of it. There, the jury returned a verdict of "guilty" in respect of some charges and "not guilty" in respect of others. But the Sessions Judge recorded his judgment of acquittal in respect of the latter charges in agreement with the jury and referred the case to the High Court only in respect of the former. This Court held that the said procedure violated sub section (2) of section 307 of the Code of Criminal Procedure and also had the effect of preventing the High Court from considering the entire evidence against the accused and exercising its jurisdiction under sub section (3) of section 307 of the said Code. Imam, J., observed that the reference in that case was incompetent and that the High Court could not proceed to exercise any of the powers conferred upon it under sub section (3) of section 307 of the Code, because the very foundation of the exercise of that power was lacking, the reference being incompetent. This 592 Court held that the reference was incompetent because the Sessions Judge contravened the express provisions of sub section (2) of section 307 of the Code, for under that sub section whenever a Judge submits a case under that section, he shall not record judgment of acquittal or of conviction on any of the charges on which such accused has been tried, but he may either remand such accused to custody or admit him to bail. As in that case the reference was made in contravention of the express provisions of sub section (2) of section 307 of the Code and therefore the use of the word 'incompetent ' may not be in appropriate. The decision of a division bench of the Patna High Court in Emperor vs Ramadhar Kurmi may usefully be referred to as it throws some light on the question whether the High Court can interfere with the verdict of the jury when it is vitiated by serious misdirections and non directions. Das, J., observed: "Where, however, there is misdirection, the principle embodied in section 537 would apply and if the verdict is erroneous owing to the misdirection, it can have no weight on a reference under section 307 as on an appeal. It is not necessary to multiply decisions. The foregoing discussion may be summarized in the form of the following propositions: (1) The competency of a reference made by a Sessions Judge depends upon the existence of two conditions, namely, (i) that he disagrees with the verdict of the jurors, and (ii) that he is clearly of the opinion that the verdict is one which no reasonable body of men could have reached on the evidence, after reaching that opinion, in the case submitted by him he shall record the grounds of his opinion. (2) If the case submitted shows that the conditions have not been complied with or that the reasons for the opinion are not recorded, the High Court may reject the reference as incompetent : the 593 High Court can also reject it if the Sessions Judge has contravened sub section (2) of section 307. (3) If the case submitted shows that the Sessions Judge has disagreed with the verdict of the jury and that he is clearly of the opinion that no reasonable body of men could have reached the conclusion arrived at by the jury, and he discloses his reasons for the opinion, sub section (3) of section 307 of the Code comes into play, and thereafter the High Court has an obligation to discharge its duty imposed thereunder. (4) Under sub section (3) of section 307 of the Code, the High Court has to consider the entire evidence and, after giving due weight to the opinions of the Sessions Judge and the jury, acquit or convict the accused. (5) The High Court may deal with the reference in two ways, namely, (i) if there are misdirections vitiating the verdict, it may, after going into the entire evidence, disregard the verdict of the jury and come to its own conclusion, and (ii) even if there are no misdirections, the High court can interfere with the verdict of the jury if it finds the verdict "perverse in the sense of being unreasonable", "manifestly wrong", or "against the wight of evidence", or, in other words, if the verdict is such that no reasonable body of men could have reached on the evidence. (6) In the disposal of the said reference, the High Court can exercise any of the procedural powers appropriate to the occasion, such as, issuing of notice, calling for records, remanding the case, ordering a retrial, etc. We therefore, reject the first contention of learned counsel for the appellant. The next question is whether the High Court was right in holding that there were misdirections in the charge to the jury. Misdirections is something which a judge in his charge tells the jury and is wrong or in a wrong manner tending to mislead them. Even an omission to mention matters which are essential to the prosecution or the defence case in order to help the jury to come to a correct 594 verdict may also in certain circumstances amount to a misdirection. But, in either case, every misdirection or non direction is not in itself sufficient to set aside a verdict, but it must be such that it has occasioned a failure of justice. In Mushtak Hussein vs The State of Bombay, this Court laid down: "Unless therefore it is established in a case that there has been a serious misdirection by the judge in charging the jury which has occasioned a failure of justice and has misled the jury in giving its verdict, the verdict of the jury cannot be set aside." This view has been restated by this Court in a recent decision, viz., Smt. Nagindra Bala Mitra vs Sunil Chandra Roy. The High Court in its judgment referred to as many as six misdirections in the charge to the jury which in its view vitiated the verdict, and it also stated that there were many others. Learned counsel for the appellant had taken each of the said alleged misdirections and attempted to demonstrate that they were either no misdirections at all, or even if they were, they did not in any way affect the correctness of the verdict. We shall now take the first and the third misdirections pointed out by Shelat, J., as they are intimately connected with each other. They are really omissions. The first omission is that throughout the entire charge there is no reference to section 105 of the Evidence Act or to the statutory presumption laid down in that section. The second omission is that the Sessions Judge failed to explain to the jury the legal ingredients of section 80 of the Indian Penal Code, and also failed to direct them that in law the said section was not applicable to the facts of the case. To appreciate the scope of the alleged 595 omissions, it is necessary to read the relevant provisions. Section 80 of the Indian Penal Code. "Nothing is an offence which is done by accident or misfortune, and without any criminal intention or knowledge in the doing of a lawful act in a lawful manner by lawful means and with proper care and caution. " Evidence Act. Section 103: "The burden of proof as to any particular fact lies on that person who wishes the Court to believe in its existence, unless it is provided by any law that the proof of that fact shall lie on any particular person. " Section 105: "When a person is accused of any offence, the burden of proving the existence of circumstances bringing the case within any of the General Exceptions in the Indian Penal Code (XLV of 1860) or within any special exception or proviso contained in any other part of the same Code, or in any law defining the offence, is upon him, and the Court shall presume the absence of such circumstances. " Section 3: "In this Act the following words and expressions are used in the following senses, unless a contrary intention appears from the context: A fact is said to be disproved when, after considering the matters before it, the Court either believes that it does not exist, or considers its non existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it does not exist. " 596 Section 4: . ."Whenever it is directed by this Act that the Court shall presume a fact, it shall regard such fact as proved unless and until it is disproved." The legal impact of the said provisions on the question of burden of proof may be stated thus: In India, as it is in England, there is a presumption of innocence in favour of the accused as a general rule, and it is the duty of the prosecution to prove the guilty of the accused; to put it in other words, the accused is presumed to be innocent until his guilt is established by the prosecution. But when an accused relies upon the General Exceptions in the Indian Penal Code or on any special exception or proviso contained in any other part of the Penal Code, or in any law defining an offence, section 105 of the Evidence Act raises a presumption against the accused and also throws a burden on him to rebut the said presumption. Under that section the Court shall presume the absence of circumstances bringing the case within any of the exceptions, that is, the Court shall regard the non existence of such circumstances as proved till they are disproved. An illustration based on the facts of the present case may bring out the meaning of the said provision. The prosecution alleges that the accused intentionally shot the deceased; but the accused pleads that, though the shots emanated from his revolver and hit the deceased, it was by accident, that is, the shots went off the revolver in the course of a struggle in the circumstances mentioned in section 80 of the Indian Penal Code and hit the deceased resulting in his death. The Court then shall presume the absence of circumstances bringing the case within the provisions of section 80 of the Indian Penal Code, that is, it shall presume that the shooting was not by accident, and that the other circumstances bringing the case within the exception did not exist; but this presumption may be rebutted by the accused by adducing evidence to 597 support his plea of accident in the circumstances mentioned therein. This presumption may also be rebutted by admissions made or circumstances elicited by the evidence led by the prosecution or by the combined effect of such circumstances and the evidence adduced by the accused. But the section does not in any way affect the burden that lies on the prosecution to prove all the ingredients of the offence with which the accused is charged: that burden never shifts. The alleged conflict between the general burden which lies on the prosecution and the special burden imposed on the accused under section 105 of the Evidence Act is more imaginary than real. Indeed, there is no conflict at all. There may arise three different situations: (1) A statute may throw the burden of proof of all or some of the ingredients of an offence on the accused: (see sections 4 and 5 of the Prevention of Corruption Act). (2) The special burden may not touch the ingredients of the offence, but only the protection given on the assumption of the proof of the said ingredients: (see sections 77,78,79,81 and 88 of the Indian Penal Code). (3) It may relate to an exception, some of the many circumstances required to attract the exception if proved affecting the proof of all or some of the ingredients of the offence: (see section 80 of the Indian Penal Code). In the first case the burden of proving the ingredients or some of the ingredients of the offence, as the case may be, lies on the accused. In the second case, the burden of bringing the case under the exception lies on the accused. In the third case, though the burden lies on the accused to bring his case within the exception, the facts proved may not discharge the said burden, but may affect the proof of the ingredients of the offence. An illustration may bring out the meaning. The prosecution has to prove that the accused shot dead the deceased intentionally and thereby committed the offence of murder within the meaning of section 300 of the Indian 598 Penal Code; the prosecution has to prove the ingredients of murder, and one of the ingredients of that offence is that the accused intentionally shot the deceased; the accused pleads that he shot at the deceased by accident without any intention or knowledge in the doing of a lawful act in a lawful manner by lawful means with proper care and caution; the accused against whom a presumption is drawn under section 105 of the Evidence Act that the shooting was not by accident in the circumstances mentioned in section 80 of the Indian Penal Code, may adduce evidence to rebut that presumption. That evidence may not be sufficient to prove all the ingredients of section 80 of the Indian Penal Code, but may prove that the shooting was by accident or inadvertence, i.e., it was done without any intention or requisite state of mind, which is the essence of the offence, within the meaning of section 300, Indian Penal Code, or at any rate may throw a reasonable doubt on the essential ingredients of the offence of murder. In that event though the accused failed to bring his case within the terms of section 80 of the Indian Penal Code, the Court may hold that the ingredients of the offence have not been established or that the prosecution has not made out the case against the accused. In this view it might be said that the general burden to prove the ingredients of the offence, unless there is a specific statute to the contrary, is always on the prosecution, but the burden to prove the circumstances coming under the exceptions lies upon the accused. The failure on the part of the accused to establish all the circumstances bringing his case under the exception does not absolve the prosecution to prove the ingredients of the offence; indeed, the evidence, though insufficient to establish the exception, may be sufficient to negative one or more of the ingredients of the offence. 599 The English decisions relied upon by Mr. Pathak, learned counsel for the accused, may not be of much help in construing the provisions of section 105 of the Indian Evidence Act. We would, therefore, prefer not to refer to them, except to one of the leading decisions on the subject, namely, Woolmington vs The Director of Public Prosecutions. The headnote in that decision gives its gist, and it read: "In a trial for murder the Crown must prove death as the result of a voluntary act of the prisoner and malice of the prisoner. When evidence of death and malice has been given, the prisoner is entitled to show by evidence or by examination of the circumstances adduced by the Crown that the act on his part which caused death was either unintentional or provoked. If the jury are either satisfied with his explanation or, upon a review of all the evidence, are left in reasonable doubt whether, even if his explanation be not accepted, the act was unintentional or provoked, the prisoner is entitled to be acquitted. " In the course of the judgment Viscount Sankey, L. C., speaking for the House, made the following observations: "But while the prosecution must prove the guilt of the prisoner, there is no such burden laid on the prisoner to prove his innocence and it is sufficient for him to raise a doubt as to his guilt; he is not bound to satisfy the jury of his innocence. Throughout the web of the English Criminal Law one golden thread is always to be seen that it is the duty of the prosecution to prove the prisoner 's guilt subject to what I have already said as to the defence of insanity and subject also to any statutory exception. If, 600 at the end of and on the whole of the case, there is a reasonable doubt, created by the evidence given by either the prosecution or the prisoner, as to whether the prisoner killed the deceased with a malicious intention, the prosecution has not made out the case and the prisoner is entitled to an acquittal. " These passages are not in conflict with the opinion expressed by us earlier. As in England so in India, the prosecution must prove the guilt of the accused, i.e., it must establish all the ingredients of the offence with which he is charged. As in England so also in India, the general burden of proof is upon the prosecution; and if, on the basis of the evidence adduced by the prosecution or by the accused, there is a reasonable doubt whether the accused committed the offence, he is entitled to the benefit of doubt. In India if an accused pleads an exemption within the meaning of section 80 of the Indian Penal Code, there is a presumption against him and the burden to rebut that presumption lies on him. In England there is no provision similar to section 80 of the Indian Penal Code, but Viscount Sankey, L. C., makes it clear that such a burden lies upon the accused if his defence is one of insanity and in a case where there is a statutory exception to the general rule of burden of proof. Such an exception we find in section 105 of the Indian Evidence Act. Reliance is placed by learned counsel for the accused on the decision of the Privy Council in Attygalle vs Emperor in support of the contention that notwithstanding section 105 of the Evidence Act, the burden of establishing the absence of accident within the meaning of section 80 of the Indian Penal Code is on the prosecution. In that case, two persons were prosecuted, one for performing an illegal operation and the other for abetting him in that crime. Under section 106 of the Ordinance 14 of 601 1895 in the Ceylon Code, which corresponds to section 106 of the Indian Evidence Act, it was enacted that when any fact was especially within the knowledge of any person, the burden of proving that fact was upon him. Relying upon that section, the Judge in his charge to the jury said: "Miss Maye that is the person upon whom the operation was alleged to have been performed was unconscious and what took place in that room that three quarters of an hour that she was under chloroform is a fact specially within the knowledge of these two accused who were there. The burden of proving that fact, the law says, is upon him, namely that no criminal operation took place but what took place was this and this speculum examination. " The Judicial Committee pointed out: "It is not the law of Ceylon that the burden is cast upon an accused person of proving that no crime has been committed. The jury might well have thought from the passage just quoted that that was in fact a burden which the accused person had to discharge. The summing up goes on to explain the presumption of innocence in favour of accused persons, but it again reiterates that the burden of proving that no criminal operation took place is on the two accused who were there." The said observations do not support the contention of learned counsel. Section 106 of Ordinance 14 of 1895 of the Ceylon Code did not cast upon the accused a burden to prove that he had not committed any crime; nor did it deal with any exception similar to that provided under section 80 of the Indian Penal Code. It has no hearing on the construction of s.105 of the Indian Evidence Act. The 602 decisions of this Court in The State of Madras vs A. Vaidyanatha Iyer (1), which deals with section 4 of the Prevention of Corruption Act, 1947, and C.S.D. Swami vs The State(2), which considers the scope of section 5(3) of the said Act, are examples of a statute throwing the burden of proving and even of establishing the absence of some of the ingredients of the offence on the accused; and this Court held that notwithstanding the general burden on the prosecution to prove the offence, the burden of proving the absence of the ingredients of the offence under certain circumstances was on the accused. Further citations are unnecessary as, in our view, the terms of s.105 of the Evidence Act are clear and unambiguous. Mr. Pathak contends that the accused did not rely upon any exception within the meaning of s.80 of the Indian Penal Code and that his plea all through has been only that the prosecution has failed to establish intentional killing on his part. Alternatively, he argues that as the entire evidence has been adduced both by the prosecution and by the accused, the burden of proof became only academic and the jury was in a position to come to one conclusion or other on the evidence irrespective of the burden of proof. Before the Sessions Judge the accused certainly relied upon section 80 of the Indian Penal Code, and the Sessions Judge dealt with the defence case in the charge to the jury. In paragraph 6 of the charge, the learned Sessions Judge stated: "Before I proceed further I have to point out another section which is section 80. You know by now that the defence of the accused is that the firing of the revolver was a matter of accident during a struggle for possession of the revolver. A struggle or a fight by itself does not exempt a person. It is the accident which exempts a person from criminal liability 603 because there may be a fight, there may be a struggle and in the fight and in the struggle the assailant may over power the victim and kill the deceased so that a struggle or a fight by itself does not exempt an assailant. It is only an accident, whether it is in struggle or a fight or otherwise which can exempt an assailant. It is only an accident, whether it is in a struggle or a fight or otherwise which can exempt a prisoner from criminal liability. I shall draw your attention to section 80 which says:. . (section 80 read). You know that there are several provisions which are to be satisfied before the benefit of this exception can be claimed by an accused person and it should be that the act itself must be an accident or misfortune, there should be no criminal intention or knowledge in the doing of that act, that act itself must be done in a lawful manner and it must be done by lawful means and further in the doing of it, you must do it with proper care and caution. In this connection, therefore, even while considering the case of accident, you will have to consider all the factors, which might emerge from the evident before you, whether it was proper care and caution to take a loaded revolver without a safety catch to the residence of the person with whom you were going to talk and it you do not get an honourable answer you was repaired to thrash him. You have also to consider this further circumstance whether it is an act with proper care and caution to keep that loaded revolver in the hand and thereafter put it aside, whether that is taking proper care and caution. This is again a question of fact and you have to determine as Judges of fact, whether the act of the accused in this case can be said to be an act which was lawfully 604 done in a lawful manner and with proper care and caution. If it is so, then and only then can you call it accident or misfortune. This is a section which you will bear in mind when you consider the evidence in this case. " In this paragraph the learned Sessions Judge mixed up the ingredients of the offence with those of the exception. He did not place before the jury the distinction in the matter of burden of proof between the ingredients of the offence and those of the exception. He did not tell the jury that where the accused relied upon the exception embodied in section 80 of the Indian Penal Code, there was a statutory presumption against him and the burden of proof was on him to rebut that presumption. What is more, he told the jury that it was for them to decide whether the act of the accused in the case could be said to be an act which was lawfully done in a lawful manner with proper care and caution. This was in effect abdicating his funtions in favour of the jury. He should have explained to them the implications of the terms "lawful act", "lawful manner", "lawful means" and "with proper care and caution" and pointed out to them the application of the said legal terminology to the facts of the case. On such a charge as in the present case, it was not possible for the jury, who were laymen, to know the exact scope of the defence and also the circumstances under which the plea under section 80 of the Indian Penal Code was made out. They would not have also known that if section 80 of the Indian Penal Code applied, there was a presumption against the accused and the burden of proof to rebut the presumption was on him. In such circumstances, we cannot predicate that the jury understood the legal implications of section 80 of the Indian Penal Code and the scope of the burden of proof under section 105 of the Evidence Act, and gave their verdict correctly. Nor can we say that the jury understood the distinction between the ingredients of the offence 605 and the circumstances that attract section 80 of the Indian Penal Code and the impact of the proof of some of the said circumstances on the proof of the ingredients of the offence. The said omissions therefore are very grave omissions which certainly vitiated the verdict of the jury. The next misdirection relates to the question of grave and sudden provocation. On this question, Shelat, J., made the following remarks: "Thus the question whether a confession of adultery by the wife of accused to him amounts to grave and sudden provocation or not was a question of law. In my view, the learned Session Judge was in error in telling the jury that the entire question was one of fact for them to decide. It was for the learned Judge to decide as a question of law whether the sudden confession by the wife of the accused amounted to grave and sudden provocation as against the deceased Ahuja which on the authorities referred to hereinabove it was not. He was therefore in error in placing this alternative case to the jury for their determination instead of deciding it himself. " The misdirection according to the learned Judge was that the Sessions Judge in his charge did not tell the jury that the sudden confession of the wife to the accused did not in law amount to sudden and grave provocation by the deceased, and instead he left the entire question to be decided by the jury. The learned judge relied upon certain English decisions and textbooks in support of his conclusion that the said question was one of law and that it was for the Judge to express his view thereon. Mr. Pathak contends that there is an essential difference between the law of England and that of India in the matter of the charge to the jury in respect of grave and sudden provocation. The House of Lords 606 in Holmes vs Director of Public Prosecution (1) laid down the law in England thus: "If there is no sufficient material, even on a view of the evidence most favourable to the accused, for a jury (which means a reasonable jury) to form the view that a reasonable person so provoked could be driven, through transport of passion and loss of self control, to the degree and method and continuance of violence which produces the death it is the duty of the judge as matter of law to direct the jury that the evidence does not support a verdict of manslaughter. If, on the other hand, the case is one in which the view might fairly be taken (a) that a reasonable person, in consequence of the provocation received, might be so rendered subject to passion or loss of control as to be led to use the violence with fatal results, and (b) that the accused was in fact acting under the stress of such provocation, then it is for the jury to determine whether on its view of the facts manslaughter or murder is the appropriate verdict." Viscount Simon brought out the distinction between the respective duties of the judge and the jury succinctly by formulating the following questions: "The distinction, therefore, is between asking 'Could the evidence support the view that the provocation was sufficient to lead a reasonable person to do what the accused did ? ' (which is for the judge to rule), and, assuming that the judge 's ruling is in affirmative, asking the jury: 'Do you consider that, on the facts as you find them from the evidence, the provocation was in fact enough to lead a reasonable person to do what the 607 accused did ? ' and, if so, 'Did the accused act under the stress of such provocation ' ?" So far as England is concerned the judgment of the House of Lords is the last word on the subject till it is statutorily changed or modified by the House of Lords. It is not, therefore, necessary to consider the opinions of learned authors on the subject cited before us to show that the said observations did not receive their approval. But Mr. Pathak contends that whatever might be the law in England, in India we are governed by the statutory provisions, and that under the explanation to Exception I to section 300 of the Indian Penal Code, the question "whether the provocation was grave and sudden enough to prevent the offence from amounting to murder is one of fact", and therefore, unlike in England, in India both the aforesaid questions fall entirely within the scope of the jury and they are for them to decide. To put it in other words, whether a reasonable person in the circumstances of a particular case committed the offence under provocation which was grave and sudden is a question of fact for the jury to decide. There is force in this argument, but it is not necessary to express our final opinion thereon, as the learned Attorney General has conceded that there was no misdirection in regard to this matter. The fourth misdirection found by the High Court is that the learned Sessions Judge told the jury that the prosecution relied on the circumstantial evidence and asked them to apply the stringent rule of burden of proof applicable to such cases, whereas in fact there was direct evidence of Puransingh in the shape of extra judicial confession. In paragraph 8 of the charge the Sessions Judge said: "In this case the prosecution relies on what is called circumstantial evidence that is 608 to say there is no witness who can say that he saw the accused actually shooting and killing deceased. There are no direct witnesses, direct witnesses as they are called, of the event in question. Prosecution relies on certain circumstances from which they ask you to deduce an inference that it must be the accused and only the accused who must have committed this crime. That is called circumstantial evidence. It is not that prosecution cannot rely on circumstantial evidence because it is not always the case or generally the case that people who go out to commit crime will also take witnesses with them. So that it may be that in some cases the prosecution may have to rely on circumstantial evidence. Now when you are dealing with circumstantial evidence you will bear in mind certain principles, namely, that the facts on which the prosecution relies must be fully established. They must be fully and firmly established. These facts must lead to one conclusion and one only namely the guilt of the accused and lastly it must exclude all reasonable hypothesis consistent with the innocence of the accused, all reasonable hypothesis consistent with the innocence of the accused should be excluded. In other words you must come to the conclusion by all the human probability, it must be the accused and the accused only who must have committed this crime. That is the standard of proof in a case resting on circumstantial evidence. " Again in paragraph 11 the learned Sessions Judge observed that the jury were dealing with circumstantial evidence and graphically stated: "It is like this, take a word, split it up into letters, the letters, may individually mean nothing but when they are combined 609 they will form a word pregnant with meaning. That is the way how you have to consider the circumstantial evidence. You have to take all the circumstances together and judge for yourself whether the prosecution have established their case," In paragraph 18 of the charge, the learned Sessions Judge dealt with the evidence of Puran singh separately and told the jury that if his evidence was believed, it was one of the best forms of evidence against the man who made the admission and that if they accepted that evidence, then the story of the defence that it was an accident would become untenable. Finally he summarized all the circumstances on which the prosecution relied in paragraph 34 and one of the circumstances mentioned was the extra judicial confession made to Puransingh. In that paragraph the learned Sessions Judge observed as follows: "I will now summarize the circumstances on which the prosecution relies in this case. Consider whether the circumstances are established beyond all reasonable doubt. In this case you are dealing with circumstantial evidence and therefore consider whether they are fully and firmly established and consider whether they lead to one conclusion and only one conclusion that it is the accused alone who must have shot the deceased and further consider that it leaves no room for any reasonable hypothesis consistent with the innocence of the accused regard being had to all the circumstances in the case and the conclusion that you have to come to should be of this nature and by all human probability it must be the accused and the accused alone who must have committed this crime". 610 Finally the learned Sessions Judge told them: "If on the other hand you think that the circumstances on which the prosecution relies are fully and firmly established, that they lead to one and the only conclusion and one only, of the guilt of the accused and that they exclude all reasonable hypothesis of the innocence of the accused then and in that case it will be your duty which you are bound by the oath to bring verdict accordingly without any fear or any favour and without regard being had to any consequence that this verdict might lead to." Mr. Pathak contends that the learned Sessions Judge dealt with the evidence in two parts, in one part he explained to the jury the well settled rule of approach to circumstantial evidence, whereas in another part he clearly and definitely pointed to the jury the great evidentially value of the extra judicial confession of guilt by the accused made to Puransingh, if that was believed by them. He therefore, argues that there was no scope for any confusion in the minds of the jurors in regard to their approach to the evidence or in regard to the evidentially value of the extra judicial confession. The argument proceeds that even if there was a misdirection, it was not such as to vitiate the verdict of the jury. It is not possible to accept this argument. We have got to look at the question from the standpoint of the possible effect of the said misdirection in the charge on the jury, who are laymen. In more than one place the learned Sessions Judge pointed out that the case depended upon circumstantial evidence and that the jury should apply the rule of circumstantial evidence settled by decisions. Though at one place he emphasized upon evidentiary value of a confession he later on included that confession also as one of the circumstances and again directed the jury to apply the rule of circumstantial evidence. It is 611 not disputed that the extra judicial confession made to Puransingh is direct piece of evidence and that the stringent rule of approach to circumstantial evidence does not apply to it. If that confession was true, it cannot be disputed that the approach of the jury to the evidence would be different from that if that was excluded. It is not possible to predicate that the jury did not accept that confession and therefore applied the rule of circumstantial evidence. It may well have been that the jury accepted it and still were guided by the rule of circumstantial evidence as pointed out by the learned Sessions Judge. In these circumstances we must hold, agreeing with the High Court, that this is a grave misdirection affecting the correctness of the verdict. The next misdirection relied upon by the High Court is the circumstance that the three letters written by Sylvia were not read to the jury by the learned Sessions Judge in his charge and that the jury were not told of their effect on the credibility of the evidence of Sylvia and Nanavati. Shelat, J., observed in regard to this circumstance thus: "It cannot be gainsaid that these letters were important documents disclosing the state of mind of Mrs. Nanavati and the deceased to a certain extent. If these letters had been read in juxtaposition of Mrs. Nanavati 's evidence they would have shown that her statement that she felt that Ahuja had asked her not to see him for a month for the purpose of backing out of the intended marriage was not correct and that they had agreed not to see each other for the purpose of giving her and also to him an opportunity to coolly think out the implications of such a marriage and then to make up her own mind on her own. The letters would also show that when the accused asked her, as he said in his 612 evidence, whether Ahuja would marry her, it was not probable that she would fence that question. On the other hand, she would, in all probability, have told him that they had already decided to marry. In my view, the omission to refer even once to these letters in the charge especially in view of Mrs. nanavati 's evidence was a nondirection amounting to misdirection." Mr. Pathak contends that these letters were read to the jury by counsel on both sides and a reference was also made to hem in the evidence of Sylivia and, therefore the jury clearly knew the contents of the letters, and that in the circumstances the non mention of the contents of the letters by the Sessions Judge was not a misdirection and even if it was it did not affect the verdict of the jury. In this context reliance is placed upon two English decisions, namely, R. vs Roberts (1) and R. vs Attfield (2). In the former case the appellant was prosecuted for the murder of a girl by shooting her with a service rifle and he pleaded accident as his defence. The Judge in his summing up, among other defects, omitted to refer to the evidence of certain witnesses; the jury returned a verdict of "guilty" on the charge of murder and it was accepted by the judge, it was contended that the omission to refer to the evidence of certain witnesses was a misdirection. Rejecting that plea, Humphreys, J., observed: "The jury had the statements before them. They had the whole of the evidence before them, and they had, just before the summing up, comments upon those matters from counsel for the defence, and from counsel for the prosecution. It is incredible that they could have forgotten them or that they could have misunderstood the matter in any 613 way, or thought, by reason of the fact that the judge did not think it necessary to refer to them, that they were not to pay attention to them. We do not think there is anything in that point at all. A judge, in summing up, is not obliged to refer to every witness in the case, unless he thinks it necessary to do so. In saying this, the court is by no means saying that it might not have been more satisfactory if the judge had referred to the evidence of the two witnesses, seeing that he did not think it necessary to refer to some of the statements made by the accused after the occurrence. No doubt it would have been more satisfactory from the point of view of the accused. All we are saying is that we are satisfied that there was no misdirection in law on the part of judge in omitting those statements, and it was within his discretion. " This passage does snot lay down as a proposition of law that however important certain documents or pieces of evidence may be from the standpoint of the accused or the prosecution, the judge need not refer to or explain them in his summing up to the jury, and, if he did not, it would not amount to misdirection under any circumstances. In that case some statements made by witnesses were not specifically brought to the notice of the jury and the Court held in the circumstances of that case that there was no misdirection. In the latter case the facts were simple and the evidence was short; the judge summed up the case directing the jury as to the law but did not deal with evidence except in regard to the appellant 's character. The jury convicted the appellant. The court held that, "although in a complicated and lengthy case it was incumbent on the court to deal with the evidence in summing up, yet where, as in the present case, the issues could be simply and clearly stated, it was 614 not fatal defect for the evidence not to be reviewed in the summing up. " This is also a decision on the facts of that case. That apart, we are not concerned with a simple case here but with a complicated one. This decision does not help us in deciding the point raised. Whether a particular omission by a judge to place before the jury certain evidence amounts to a misdirection or not falls to be decided on the facts of cash case. These letters show the exact position of Sylvia in the context of her intended marriage with Ahuja, and help to test the truthfulness or otherwise of some of the assertions made by her to Nanavati. A perusal of these letters indicates that Sylvia and Ahuja were on intimate terms, that Ahuja was willing to marry her, that they had made up their minds to marry, but agreed to keep apart for a month to consider coolly whether they really wanted to marry in view of the serious consequences involved in taking such a step. Both Nanavati and Sylvia gave evidence giving an impression that Ahuja was backing out of his promise to marry Sylvia and that was the main reason for Nanavati going to Ahuja 's flat for an explanation. If the Judge had read these letters in his charge and explained the implication of the contents thereof in relation to the evidence given by Nanavati and Sylvia, it would not have been possible to predicate whether the jury would have believed the evidence of Nanavati and Sylvia. If the marriage between them was a settled affair and if the only obstruction in the way was Nanavati, and if Nanavati had expressed his willingness to be out of the way and even to help them to marry, their evidence that Sylvia did not answer the direct question about the intentions of Ahuja to marry her, and the evidence of Nanavati that it became necessary for him to go to Ahuja 's flat to ascertain the latter 's intentions might not have been believed 615 by the jury. It is no answer to say that the letters were read to the jury at different stages of the trial or that they might have read the letters themselves for in a jury trial, especially where innumerable documents are filed, it is difficult for a lay jury, unless properly directed, to realise the relative importance of specified documents in the context of different aspects of a case. That is why the Code of Criminal Procedure, under section 297 thereof, imposes a duty on the Sessions Judge to charge the jury after the entire evidence is given, and after counsel appearing for the accused and counsel appearing for the prosecution have addressed them. The object of the charge to the jury by the Judge is clearly to enable him to explain the law and also to place before them the facts and circumstances of the case both for and against the prosecution in order to help them in arriving at a right decision. The fact that the letters were read to the jury by prosecution or by the counsel for the defence is not of much relevance, for they would place the evidence before the jury from different angles to induce them to accept their respective versions. That fact in itself cannot absolve the Judge from his clear duty to put the contents of the letters before the jury from the correct perspective. We are in agreement with the High Court that this was a clear misdirection which might have affected the verdict of the jury. The next defect pointed out by the High Court is that the Sessions Judge allowed the counsel for the accused to elicit from the police officer, Phansalkar, what Puransingh is alleged to have stated to him orally, in order to contradict the evidence of Puransingh in the court, and the Judge also dealt with the evidence so elicited in paragraph 18 of his charge to the jury. This contention cannot be fully appreciated unless some relevant facts are stated. Puransingh was examined for the prosecution as P. W. 12. he was a 616 watchman of 'Jivan Jyot." He deposed that when the accused was leaving the compound of the said building, he asked him why he had killed Ahuja, and the accused told him that he had a quarrel with Ahuja as the latter had "connections" with his wife and therefore he killed him. At about 5 5 P. M. on April 27, 1959, this witness reported this incident to Gamdevi Police Station. On that day Phansalkar (P. W. 13) was the Station House Duty Officer at that station from 2 to 8 P.M. On the basis of the statement of Puransingh, Phansalkar went in a jeep with Puransingh to the place of the alleged offence. Puransingh said in his evidence that he told Phansalkar in the jeep what the accused had told him when he was leaving the compound of "Jivan Jyot." After reaching the place of the alleged offence, Phansalkar learnt from a doctor that Ahuja was dead and he also made enquiries from Miss Mammie, the sister of the deceased. He did not record the statement made by Puransingh. But latter on between 10 and 10 30 P. M. on the same day, Phansalkar made a statement to Inspector Mokashi what Puransingh had told him and that statement was recorded by Mokashi. In the statement taken by Mokashi it was not recorded that Puransingh told Phansalkar that the accused told him why he had killed Ahuja. When Phansalkar was in the witness box to a question put to him in cross examination he answered that Puransingh did not tell him that he had asked Nanavati why he killed Ahuja and that the accused replied that he had a quarrel with the deceased as the latter had "connections" with his wife and that he had killed him. The learned Sessions Judge not only allowed the evidence to go in but also, in paragraph 18 of his charge to the jury, referred to that statement. After giving the summary of the evidence given by Puransingh, the learned Sessions Judge proceeded to state in his charge to the jury: 617 "Now the conversation between him and Phansalkar (Sub Inspector) was brought on record in which what the chowkidar told Sub Inspector Phansalkar was, the servants of the flat of Miss Ahuja had informed him that a Naval Officer was going away in the car. He and the servants had tried to stop him but the said officer drove away in the car saying that he was going to the Police Station and to Sub Inspector Phansalkar he did not state about the admission made by Mr. Nanavati to him that he killed the deceased as the deceased had connections with his wife. The chowkidar said that he had told this also to sub Inspector Phansalkar. Sub Inspector Phansalkar said that Puransingh had not made this statement to him. You will remember that this chowkidar went to the police station at Gamdevi to give information about this crime and while coming back he was with Sub Inspector Phansalkar and Sub Inspector Phansalkar in his own statement to Mr. Mokashi has referred to the conversation which he had between him and this witness Puransingh and that had been brought on record as a contradiction." The learned Sessions Judge then proceeded to state other circumstances and observed, "Consider whether you will accept the evidence of Puransingh or not. " It is manifest from the summing up that the learned Sessions Judge not only read to the jury the evidence of Phansalkar wherein he stated that Puransingh did not tell him that the accused told him why he killed Ahuja but also did not tell the jury that the evidence of Phansalkar was not admissible to contradict the evidence of Puransingh. It is not possible to predicate what was the effect of the alleged contradiction on the mind of the jury and whether they had not rejected the evidence of Puransingh 618 because of that contradiction. If the said evidence was not admissible, the placing of that evidence before the jury was certainly a grave misdirection which must have affected their verdict. The question is whether such evidence is legally admissible. The alleged omission was brought on record in the cross examination of Phansalkar, and, after having brought it in, it was sought to be used to contradict the evidence of Puransingh. Learned Attorney General contends that the statement made by Phansalkar to Inspector Mokashi could be used only to contradict the evidence of Phansalkar and not that of Puransingh under section 162 of the Code of Criminal Procedure; and the statement made by Puransingh to Phansalkar, it not having been recorded, could not be used at all to contradict the evidence of Puransingh under the said section. He further argues that the alleged omission not being a contradiction, it could in no event be used to contradict Puransingh. Learned counsel for the accused, on the other hand, contends that the alleged statement was made to a police officer before the investigation commenced and, therefore, it was not hit by section 162 of the Code of Criminal Procedure, and it could be used to contradict the evidence of Puransingh. Section 162 of the Code of Criminal Procedure reads: "(1) No statement made by any person to a Police officer in the course of an investigation under this Chapter shall, if reduced into writing be signed by the person making it; nor shall any such statement or any record thereof, whether in a police diary or otherwise, or any part of such statement or record, be used for any purpose, save as hereinafter provided, at any inquiry or trial in respect of any offence under investigation at the time when such statement was made: 619 "Provided that when any witness is called for the prosecution in such inquiry or trial whose statement has been reduced into writing as aforesaid, any part of his statement, if duly proved, may be used by the accused, and with the permission of the Court, by the prosecution, to contradict such witness in the manner provided by section 145 of the (1 of 1872), and when any part of such statement is so used, any part thereof may also be used in the re examination of such witness, but for the purpose only of explaining any matter referred to in his cross examination." The preliminary condition for the application of section 162 of the Code is that the statement should have been made to a police officer in the course of an investigation under Chapter XIV of the Code. If it was not made in the course of such investigation, the admissibility of such statement would not be governed by section 162 of the Code. The question, therefore, is whether Puransingh made the statement to Phansalkar in the course of investigation. Section 154 of the Code says that every information relating to the commission of cognizable offence if given orally to an officer in charge of a police station shall be reduced to writing by him or under his direction; and section 156(1) is to the effect that any officer in charge of a police station may, without the order of a Magistrate, investigate any cognizable case which a court having jurisdiction over the local area within the limits of such station would have power to inquire into or try under the provisions of Chapter XIV relating to the place of inquiry or trial. The evidence in the case clearly establishes that Phansalkar, being the Station House Duty officer at Gamdevi Police station on April 27, 1959, from 2 to 8 P. M. was an officer in charge of the 620 Police station within the meaning of the said sections. Puransingh in his evidence says that he went to Gamdevi Police station and gave the information of the shooting incident to the Gamdevi Police. Phansalkar in his evidence says that on the basis of the information he went along with Puransingh to the place of the alleged offence. His evidence also discloses that he had questioned Puransingh, the doctor and also Miss Mammie in regard to the said incident. On this uncontradicted evidence there cannot be any doubt that the investigation of the offence had commenced and Puransingh made the statement to the police officer in the course of the said investigation. But it is said that, as the information given by Puransingh was not recorded by Police Officer Phansalkar as he should do under section 154 of the Code of Criminal Procedure, no investigation in law could have commenced with the meaning of section 156 of the Code. The question whether investigation had commenced or not is a question of fact and it does not depend upon any irregularity committed in the matter of recording the first information report by the concerned police officer. If so, section 162 of the Code is immediately attracted. Under section 162(1) of the Code, no statement made by any person to Police officer in the course of an investigation can be used for any purpose at any inquiry or trial in respect of any offence under investigation at the time when such statement made. But the proviso lifts the ban and says that when any witness is called for the prosecution in such inquiry or trial whose statement has been reduced into writing, any part of his statement, if duly proved, may be used by the accused to contradict such witness. The proviso cannot be invoked to bring in the statement made by Phansalkar to Inspector Mokashi in the cross examination of Phansalkar, for the statement made by him was not used to contradict the evidence of Phansalkar. The proviso cannot obviously apply to the oral 621 statement made by Puransingh to Phansalkar, for the said statement of Puransingh has not been reduced into writing. The faint argument of learned counsel for the accused that the statement of Phansalkar recorded by Inspector Mokashi can be treated as a recorded statement of Puransingh himself is to be stated only to be rejected, for it is impossible to treat the recorded statement of Phansalkar as the recorded statement of Puransingh by a police officer. If so, the question whether the alleged omission of what the accused told Puransingh in Puransingh 's oral statement to Phansalkar could be used to contradict Puransingh, in view of the decision of this Court in Tahsildar Singh 's case(1), does not arise for consideration. We are, therefore, clearly of the opinion that not only the learned Sessions Judge acted illegally in admitting the alleged omission in evidence to contradict the evidence of Puransingh, but also clearly misdirected himself in placing the said evidence before the jury for their consideration. In addition to the misdirections pointed out by the High Court, the learned Attorney General relied upon another alleged misdirection by the learned Sessions Judge in his charge. In paragraph 28 of the charge, the learned Sessions Judge stated thus: "No one challenges the marksmanship of the accused but Commodore Nanda had come to tell you that he is a good shot and Mr. Kandalawala said that here was a man and good marksman, would have shot him, riddled him with bullets perpendicularly and not that way and he further said that as it is not done in this case it shows that the accused is a good marksman and a good shot and he would not have done this thing, this is the argument." The learned Attorney General points out that the learned Sessions Judge was wrong in saying that 622 no one challenged the marksmanship of the accused, for Commodore Nanda was examined at length on the competency of the accused as a marksman. Though this is a misdirection, we do not think that the said passage, having regard to the other circumstances of the case, could have in any way affected the verdict of the jury. It is, therefore, clear that there were grave misdirections in this case, affecting the verdict of the jury, and the High Court was certainly within its rights to consider the evidence and come to its own conclusion thereon. The learned Attorney General contends that if he was right in his contention that the High Court could consider the evidence afresh and come to its own conclusion, in view of the said misdirection, this Court should not, in exercise of its discretionary jurisdiction under article 136 of the Constitutions interfere with the findings of the High Court. There is force in this argument. But, as we have heard counsel at great length, we propose to discuss the evidence. We shall now proceed to consider the evidence in the case. The evidence can be divided into three parts, namely, (i) evidence relating to the conduct of the accused before the shooting incident, (ii) evidence in regard to the conduct of the accused after the incident, and (iii) evidence in regard to the actual shooting in the bed room of Ahuja. We may start with the evidence of the accused wherein he gives the circumstances under which he came to know of the illicit intimacy of his wife Sylvia with the deceased Ahuja, and the reasons for which he went to the flat of Ahuja in the evening of April 27, 1959. After his brother and his brother 's wife, who stayed with him for a few days, had left, he found his wife behaving strangely and without affection towards him. Though on that ground he was unhappy and worried, he did not 623 suspect of her unfaithfulness to him. On the morning of April 27, 1959, he and his wife took out their sick dog to the Parel Animal Hospital. On their way back, they stopped at the Metro Cinema and his wife bought some tickets for the 3 30 show. After coming home, they were sitting in the room for the lunch to be served when he put his arm around his wife affectionately and she seemed to go tense and was very unresponsive. After lunch, when his wife was reading in the sitting room, he told her "Look, we must get these things straight" or something like that, and "Do you still love me?" As she did not answer, he asked her "Are you in love with some one else?", but she gave no answer. At that time he remembered that she had not been to a party given by his brother when he was away on the sea and when asked why she did not go, she told him that she had a previous dinner engagement with Miss Ahuja. On the basis of this incident, he asked her "Is it Ahuja ?" and she said "Yes" When he asked her "Have you been faithful to me ?", she shook her head to indicate "No." Sylvi in her evidence, as D. W. 10, broadly supported this version. It appears to us that this is clearly a made up conversation and an unnatural one too. Is it likely that Nanavati, who says in his evidence that prior to April 27, 1959, he did not think that his wife was unfaithful to him, would have suddenly thought that she had a lover on the basis of a trivial circumstance of her being unresponsive when he put his arm around her affectionately ? Her coldness towards him might have been due to many reasons. Unless he had a suspicion earlier or was informed by somebody that she was unfaithful to him, this conduct of Nanavati in suspecting his wife on the basis of the said circumstance does not appear to be the natural reaction of a husband. The recollection of her preference to attend the dinner given by Miss Mammie to that of his brother, in the absence 624 of an earlier suspicion or information, could not have flashed on his mind the image of Ahuja as a possible lover of his wife. There was nothing extraordinary in his wife keeping a previous engagement with Miss Mammie and particularly when she could rely upon her close relations not to misunderstand her. The circumstances under which the confession of unfaithfulness is alleged to have been made do not appear to be natural. This inference is also reinforced by the fact that soon after the confession, which is alleged to have upset him so much, he is said to have driven his wife and children to the cinema. If the confession of illicit intimacy between Sylvia and Ahuja was made so suddenly at lunch time, even if she had purchased the tickets, it is not likely that he would have taken her and the children to the cinema. Nanavati then proceeds to say in his evidence : on his wife admitting her illicit intimacy with Ahuja, he was absolutely stunned; he then got up and said that he must go and settle the matter with the swine; he asked her what were the intentions of Ahuja and whether Ahuja was prepared to marry her and look after the children; he wanted an explanation from Ahuja for his caddish conduct. In the cross examination he further elaborated on his intentions thus : He thought of having the matters settled with Ahuja; he would find out from him whether he would take an honourable way out of the situation; and he would thrash him if he refused to do so. The honourable course which he expected of the deceased was to marry his wife and look after the children. He made it clear further that when he went to see Ahuja the main thing in his mind was to find out what Ahuja 's intentions were towards his wife and children and to find out the explanation for his conduct. Sylvia in her evidence says that when she confessed her unfaithfulness to Nanavati the latter suddenly got up rather excitedly and said that he wanted to go 625 to Ahuja 's flat and square up the things. Briefly stated, Nanavati, according to him, went to Ahuja 's flat to ask for an explanation for seducing his wife and to find out whether he would marry Sylvia and take care of the children. Is it likely that a person, situated as anavati was, would have reacted in the manner stated by him? It is true that different persons react, under similar circumstance, differently. A husband to whom his wife confessed of infidelity may kill his wife, another may kill his wife as well as her paramour, the third, who is more sentimental. may commit suicide, and the more sophisticated one may give divorce to her and marry another. But it is most improbable, even impossible, that a husband who has been deceived by his wife would voluntarily go to the house of his wife 's paramour to ascertain his intentions, and, what is more, to ask him to take charge of his children. What was the explanation Nanavati wanted to get from Ahuja ? His wife confessed that she had illicit intimacy with Ahuja. She is not a young girl, but a woman with three children. There was no question of Ahuja seducing an innocent girl, but both Ahuja and Sylvia must have been willing parties to the illicit intimacy between them. That apart, it is clear from the evidence that Ahuja and Sylvia had decided to marry and, therefore, no further elucidation of the intention of Ahuja by Nanavati was necessary at all. It is true that Nanavati says in his evidence that when he asked her whether Ahuja was prepared to marry her and look after the children, she did not give any proper reply; and Sylvia also in her evidence says that when her husband asked her whether Ahuja was willing to marry her and look after the children she avoided answering that question as she was too ashamed to admit that Ahuja was trying to back out from the promise to marry her. That this version is not true is amply borne out by the letters written by Sylvia to 626 Ahuja. The first letter written by Sylvia is dated May 24, 1958, but that was sent to him only on March 19, 1959, along with another letter. In that letter dated May 24, 1958, she stated: "Last night when you spoke about your need to marry and about the various girls you may marry, something inside me snapped and I know that I could not bear the thought of your loving or being close to someone else." Reliance is placed upon these words by learned counsel for the accused in support of his contention that Ahuja intended to marry another girl. But this letter is of May 1958 and by that time it does not appear that there was any arrangement between Sylvia and Ahuja to marry. It may well have been that Ahuja was telling Sylvia about his intentions to marry another girl to make her jealous and to fall in for him. But as days passed by, the relationship between them had become very intimate and they began to love each other. In the letter dated March 19, 1959, she said : "Take a chance on our happiness, my love. I will do my best to make you happy; I love you, I want you so much that everything is bound to work out well. " The last sentence indicates that they had planned to marry. Whatever ambiguity there may be in these words, the letter dated April 17, 1959, written ten days prior to the shooting incident, dispels it; therein she writes "In any case nothing is going to stop my coming to you. My decision is made and I do not change my mind. I am taking this month so that we may afterwards say we gave ourselves every chance and we know what we are doing. I am torturing myself in every possible way as you asked, so that, there will be no surprise afterwards". 627 This letter clearly demonstrates that she agreed not to see Ahuja for a month, not because that Ahuja refused to marry her, but because it was settled that they should marry, and that in view of the far reaching effects of the separation from her husband on her future life and that of her children, the lovers wanted to live separately to judge for themselves whether they really loved each other so much as to marry. In the cross examination she tried to wriggle out of these letters and sought to explain them away; but the clear phraseology of the last letter speaks for itself, and her oral evidence, contrary to the contents of the letters, must be rejected. We have no doubt that her evidence, not only in regard to the question of marriage but also in regard to other matters, indicates that having lost her lover, out of necessity or out of deep penitence for her past misbehavior, she is out to help he husband in his defence. This correspondence belies the entire story that Sylvia did not reply to Nanavati when the latter asked her whether Ahuja was willing to marry her and that was the reason why Nanavati wanted to visit Ahuja to ask him about him intentions. We cannot visualize Nanavati as a romantic lover determined to immolate himself to give opportunity to his unfaithful wife to start a new life of happiness and love with her paramour after convincing him that the only honourable course open to him was to marry her and take over his children. Nanavati was not ignorant of the ways of life or so gullible as to expect any chivalry or honour in a man like Ahuja. He is an experienced Naval Officer and not a sentimental hero of a novel. The reason therefore for Nanavati going to Ahuja 's flat must be something other than asking him for an explanation and to ascertain his intention about marrying his wife and looking after the children. 628 Then, according to Nanavati, he drove his wife and children to cinema, and promising them to come and pick them up at the end of the show at about 6 p. m., he drove straight to his ship. He would say that he went to his ship to get medicine for his seek dog. Though ordinarily this statement would be insignificant, in the context of the conduct of Nanavati, it acquires significance. In the beginning of his evidence, he says that on the morning of the day of the incident he and his wife took out their sick dog to the Parel Animal Hospital. It is not his evidence that after going to the hospital he want to his ship before returning home. It is not even suggested that in the ship there was a dispensary catering medicine for animals. This statement, therefore, is not true and he did not go to the ship for getting medicine for his dog but for some other purpose, and that purpose is clear from his subsequent evidence. He met Captain Kolhi and asked for his permission to draw a revolver and six rounds because he was going to drive to Ahmednagar by night. Captain Kolhi gave him the revolver and six rounds, he immediately loaded the revolver with all the six rounds and put the revolver inside an envelope which was lying in his cabin. It is not the case of the accused that he really wanted to go to Ahmednagar and he wanted the revolver for his safety. Then why did he take the revolver? According to him he wanted to shoot himself after driving far away from his children. But he did not shoot himself either before or after Ahuja was shot dead. The taking of the revolver on false pretext and loading it with six cartridges indicate the intention on his part to shoot somebody with it. Then the accused proceeded to state that he put the envelope containing the revolver in his car and found himself driving to Ahuja 's office. At Ahuja 's office he went in keeping the revolver in the car, and asked Talaja, the Sales Manager of 629 Universal Motors of which Ahuja was the proprietor whether Ahuja was inside. He was told that Ahuja was not there. Before leaving Ahuja 's office, the accused looked for Ahuja in the Show Room, but Ahuja was not there. In the cross examination no question was put to Nanavati in regard to his statement that he kept the revolver in the car when he entered Ahuja 's office. On the basis of this statement, it is contended that if Nanavati had intended to shoot Ahuja he would have taken the revolver inside Ahuja 's office. From this circumstance it is not possible to say that Nanavati 's intention was not to shoot Ahuja. Even if his statement were true, it might well have been that he would have gone to Ahuja 's office not to shoot him there but to ascertain whether he had left the office for his flat. Whatever it may be, from Ahuja 's office he straightway drove to the flat of Ahuja. His conduct at the flat is particularly significant. His version is that he parked his car in the house compound near the steps, went up the steps, but remembered that his wife had told him that Ahuja might shoot him and so he went back to his car, took the envelope containing the revolver, and went up to the flat. He rang the doorbell; when a servant opened the door, he asked him whether Ahuja was in. Having ascertained that Ahuja was in the house, he walked to his bedroom, opened the door and went in shutting the door behind him. This conduct is only consistent with his intention to shoot Ahuja. A person, who wants to seek an interview with another in order to get an explanation for his conduct or to ascertain his intentions in regard to his wife and children, would go and sit in the drawing room and ask the servant to inform his master that he had come to see him. He would not have gone straight into the bed room of another with a loaded revolver in hand and closed the door behind. This was the conduct of an enraged man who had gone to wreak vengeance on a person who did him a 630 grievous wrong. But it is said that he had taken the loaded revolver with him as his wife had told him that Ahuja might shoot him. Earlier in his cross examination he said that when he told her that he must go and settle the matter with the "swine" she put her hand upon his arm and said, No, No, you must not go there, don 't go there, he may shoot you. " Sylvia in her evidence corroborates his evidence in this respect: But Sylvia has been cross examined and she said that she knew that Ahuja had a gun and she had seen it in Ashoka Hotel in New Delhi and that she had not seen any revolver at the residence of Ahuja at any time. It is also in evidence that Ahuja had no licence for revolver and no revolver of his was found in his bed room. In the circumstances, we must say that Sylvia was only attempting to help Nanavati in his defence. We think that the evidence of Nanavati supported by that of Sylvia was a collusive attempt on their part to explain away the otherwise serious implication of Nanavati carrying the loaded revolver into the bed room of Ahuja. That part of the version of the accused in regard to the manner of his entry into the bed room of Ahuja, was also supported by the evidence of Anjani (P.W. 8), the bearer, and Deepak, the Cook. Anjani opened the door of the flat to Nanavati at about 4 20 p. m. He served tea to his master at about 4 15 P. M. Ahuja then telephoned to ascertain the correct time and then went to his bed room. About five minutes thereafter this witness went to the bed room of his master to bring back the tea tray from there, and at that time his master went into the bath room for his bath. Thereafter, Anjani went to the kitchen and was preparing tea when he heard the door bell. He then opened the door to Nanavati. This evidence shows that at about 4 20 P.M. Ahuja was taking his bath in the bath room and immediately thereafter Nanavati entered the bed room. Deepak, the cook of Ahuja, also heard the ringing of the 631 door bell. He saw the accused opening the door of the bed room with a brown envelope in his hand and calling the accused by his name "Prem"; he also saw his matter having a towel wrapped around his waist and combing his hair standing before the dressing table, when the accused entered the room and closed the door behind him. These two witnesses are natural witnesses and they have been examined by the police on the same day and nothing has been elicited against them to discredit their evidence. The small discrepancies in their evidence do not in any way affect their credibility. A few seconds thereafter, Mammie, the sister of the deceased, heard the crack of the window pane. The time that elapsed between Nanavati entering the bed room of Ahuja and her hearing the noise was about 15 to 20 seconds. She describes the time that elapsed between the two events as the time taken by her to take up her saree from the door of her dressing room and her coming to the bed room door. Nanavati in his evidence says that he was in the bed room of Ahuja for about 30 to 60 seconds. Whether it was 20 seconds, as Miss Mammie says, or 30 to 60 seconds, as Nanavati deposes, the entire incident of shooting took place in a few seconds. Immediately after the sounds were heard, Anjani and Miss Mammie entered the bed room and saw the accused. The evidence discussed so far discloses clearly that Sylvia confessed to Nanavati of her illicit intimacy with Ahuja; that Nanavati went to his ship at about 3.30 P.M. and took a revolver and six rounds on a false pretext and loaded the revolver with six rounds; that thereafter he went to the office of Ahuja to ascertain his whereabouts, but was told that Ahuja had left for his house; that the accused then went to the flat of the deceased at about 4 20 P.M.; that he entered the flat and then the bed room unceremoniously with the loaded revolver, closed the door behind him and a few 632 seconds thereafter sounds were heard by Miss Mammie, the sister of the deceased, and Anjani, servant; that when Miss Mammie and Anjani entered the bed room, they saw the accused with the revolver in his hand and found Ahuja lying on the floor of the bath room. This conduct of the accused to say the least, is very damaging for the defence and indeed in itself ordinarily sufficient to implicate him in the murder of Ahuja. Now we shall scrutinize the evidence to ascertain the conduct of the accused from the time he was found in the bed room of Ahuja till he surrendered himself to the police. Immediately after the shooting, Anjani and Miss Mammie went into the bed room of the deceased. Anjani says in his evidence that he saw the accused facing the direction of his master who was lying in the bath room; that at that time the accused was having "pistol" in his hand; that when he opened the door, the accused turned his face towards this witness and saying that nobody should come in his way or else he would shoot at them, he brought his "pistol" near the chest of the witness; and that in the meantime Miss Mammie came there, and said that the accused had killed her brother. Miss Mammie in her evidence says that on hearing the sounds, she went into the bed room of her brother, and there she saw the accused nearer to the radiogram than to the door with a gun in his hand; that she asked the accused "what is this?" but she did not hear the accused saying anything. It is pointed out that there are material contradictions between what was stated by Miss Mammie and what was stated by Anjani. We do not see any material contradictions. Miss Mammie might not have heard what the accused said either because she came there after the aforesaid words were uttered or because in her anxiety and worry she did not hear the words. The different versions 633 given by the two witness in regard to what Miss Mammie said to the accused is not of any importance as the import of what both of them said is practically the same. Anjani opened he door to admit Nanavati into the flat and when he heard the noise he must have entered the room. Nanavati himself admitted that he saw a servant in the room, though he did not know him by name; he also saw Miss Mammie in the room. These small discrepancies, therefore, do not really affect their credibility. In effect any substance both saw Nanavati with a fire arm in his hand though one said pistol and the other gun going away from the room without explaining to Miss Mammie his conduct and even threatening Anjani. This could only be the conduct of a person who had committed a deliberate murder and not of one who had shot the deceased by accident. If the accused had shot the diseased by accident, he would have been in a depressed and apologetic mood and would have tried to explain his conduct to Miss Mammie or would have phoned for a doctor or asked her to send for one or at any rate he would not have been in a belligerent mood and threatened Anjani with his revolver. Learned counsel for the accused argues that in the circumstances in which the accused was placed soon after the accidental shooting he could not have convinced Miss Mammie with any amount of explanation and therefore there was no point in seeking to explain his conduct to her. But whether Miss Mammie would have been convinced by his explanation or not, if Nanavati had shot the deceased by accident, he would certainly have told her particularly when he knew her before and when she happened to be the sister of the man shot at. Assuming that the suddenness of the accidental shooting had so benumbed his senses that he failed to explain the circumstances of the shooting to her, the same cannot be said when he met others at the gate. After the accused had come out of the flat of Ahuja, 634 he got into his car and took a turn in the compound. He was stopped near the gate by Puransingh, P.W. 12, the watchman of the building. As Anjani had told him that the accused had killed Ahuja the watchman asked him why he had killed his master. The accused told him that he had a quarrel with Ahuja as the latter had "connections" with his wife and therefore he killed him. The watchman told the accused that he should not go away from the place before the police arrived, but the accused told him that he was going to the police and that if he wanted he could also come with him in the car. At that time Anjani was standing in front of the car and Deepak was a few feet away. Nanavati says in his evidence that it was not true that he told Puransingh that he had killed the deceased as the latter had "connection" with his wife and that the whole idea was quite absurd. Puransingh is not shaken in his cross examination. He is an independent witness; though he is a watchman of Jivan Jyot, he was not an employee of the deceased. After the accused left the place, this witness, at the instance of Miss Mammie, went to Gamdevi Police Station and reported the incident to the police officer Phansalkar, who was in charge of the police station at that time, at about 5 5 P.M. and came along with the said police officer in the jeep to Jivan Jyot at about 7 P.M. he went along with the police officer to the police station where his statement was recorded by Inspector Mokashi late in the night. It is suggested that this witness had conspired with Deepak and Anjani and that he was giving false evidence. We do not see any force in this contention. His statement was regarded on the night of the incident itself. It is impossible to conceive that Miss Mammie, who must have had a shock, would have been in a position to coach him up to give a false statement. Indeed, her evidence discloses that she was drugged to sleep that night. Can it be said that these two illiterate 635 witnesses, Anjani and Deepak, would have persuaded him to make a false statement that night. Though both of them were present when Puransingh questioned the accused, they deposed that they were at a distance and therefore they did not hear what the accused told Puransingh. If they had all colluded together and were prepared to speak to a false case, they could have easily supported Puransingh by stating that they also heard what the accused told Puransingh. We also do not think that the two witnesses are so intelligent as to visualize the possible defence and before hand coached Puransingh to make a false statement on the very night of the incident. Nor do we find any inherent improbability in his evidence if really Nanavati had committed the murder. Having shot Ahuja he was going to surrender himself to the police; he knew that he had committed a crime; he was not a hardened criminal and must have had a moral conviction that he was justified in doing what he did. It was quite natural, therefore, for him to confess his guilt and justify his act to the watchman who stopped him and asked him to wait there till the police came. In the mood in which Nanavati was soon after the shooting, artificial standards of status or position would not have weighed in his mind if he was going to confess and surrender to the police. We have gone through the evidence of Puransingh and we do not see any justification to reject his evidence. Leaving Jivan Jyot the accused drove his car and came to Raj Bhavan Gate. There he met a police constable and asked him for the location of the nearest police station. The direction given by the police constable were not clear and, therefore, the accused requested him to go along with him to the police station, but the constable told him that as he was on duty, he could not follow him. This 636 is a small incident in itself, but it only shows that the accused was anxious to surrender himself to the police. This would not have been the conduct of the accused, if he had shot another by accident, for in that event he would have approached a lawyer or a friend for advice before reporting the incident to the police. As the police constable was not able to give him clear directions in regard to the location of the nearest police station, the accused went to the house of Commander Samuel, the Naval Provost Marshal. What happened between the accused the Samuel is stated by Samuel in his evidence as P.W. 10. According to his evidence, on April 27, 1959, at about 4.45 P.M., he was standing at the window of his study in his flat on the ground floor at New Queen 's Road. His window opens out on the road near the band stand. The accused came up to the window and he was in a dazed condition. The witness asked him what had happened, and the accused told him "I do not quite know what happened, but I think I have shot a man. " The witness asked him how it happened, and the accused told him that the man had seduced his wife and he would not stand it. When the witness asked him to come inside and explain everything calmly, the accused said "No, thank you, I must go", "please tell me where I should go and report". Though he asked him again to come in, the accused did not go inside and, therefore, this witness instructed him to go to the C.I.D. Office and report to the Deputy Commissioner Lobo. The accused asked him to phone to Lobo and he telephoned to Lobo and told him that an officer by name Commander Nanavati was involved in an affair and that he was on the way to report to him. Nanavati in his evidence practically corroborates the evidence of Samuel. Nanavati 's version in regard to this incident is as follows: "I told him that something terrible had happened, that I did not know quite what 637 had happened but I thought I had shot a man. He asked me where this had happened. I told him at Nepean Sea Road. He asked me Why I had been there. I told him I went there because a fellow there had seduced my wife and I would not stand for it. He asked me many times to go inside his room. But I was not willing to do so, I was anxious to go to the police station. I told Commander Samuel that there had been a fight over a revolver. Commander Samuel asked to report to Deputy Commissioner Lobo. " The difference between the two versions lies in the fact that while Nanavati said that he told Samuel that something terrible had happened, Samuel did not say that; while Nanavati said that he told Samuel that there had been a fight over a revolver, Samuel did not say that. But substantially both of them say that though Samuel asked Nanavati more than once to get inside the house and explain to him everything calmly, Nanavati did not do so; both of them also deposed that the accused told Samuel, "I do not quite know what happened but I think I have shot a man. " It may be mentioned that Samuel is a Provost Marshal of the Indian navy, and he and the accused are of the same rank though the accused is senior to Samuel as Commander. As Provost Marshal, Samuel discharges police duties in the navy. Is it probable that if the deceased was shot by accident, the accused would not have stated that fact to this witness? Is it likely that he would not have stepped into his house, particularly when he requested him more than once to come in and explain to him how the accident had taken place ? Would he not have taken his advice as a colleague before he proceeded to the police station to surrender himself ? The only explanation for this unusual conduct on the part of the accused is that, having committed the murder, he wanted to surrender himself to 638 the police and to make a clean breast of everything. What is more, when he was asked directly that had happened he told him "I do not quite know what happened but I think I have shot a man". When he was further asked how it happened, that is, how he shot the man he said that the man had seduced his wife and that he would not stand for it. In the context, two answers read along with the questions put to him by Samuel only mean that, as the deceased had seduced his wife, the accused shot him as he would not stand for it. If really the accused shot the deceased by accident, why did he not say that fact to his colleague, particularly when it would not only be his defence, if prosecuted, but it would put a different complexion to his act in the eyes of his colleague. But strong reliance is Placed on what this Witness stated in the cross examination viz., "I heard the word fight from the accused", "I heard some other words from the accused but I could not make out a sense out of these words". Learned counsel for the accused contends that this statement shows that the accused mentioned to Samuel that the shooting of tho deceased was in a fight. It is not possible to build upon such slender foundation that the accused explained to Samuel that he shot the deceased by accident in a struggle. The statement in the cross examination appears to us to be an attempt on the part of this witness to help his colleague by saying something which may fit in the scheme of his defence, though at the same time he is not willing to lie deliberately in the witness box, for he clearly says that he could not make out the sense of the words spoken along with the word "fight". This vague statement of this witness, without particulars, cannot detract from the clear evidence given by him in the examination in chief. What Nanavati said to the question put by the Sessions Judge under section 342 of the Code of Criminal Procedure supports Samuel 's version. The 639 following question was put to him by the learned Sessions Judge : Q. It is alleged against you that thereafter as aforesaid you went to Commander Samuel at about 4 45 P.M. and told him that, something terrible had happened and that you did not quite know but you thought that you shot a man as he had seduced your wife which you could not stand and that on the advice of Commander Samuel you then went to Deputy Commissioner Lobo at the Head Crime Investigation Department office. Do you wish to say anything about this? A. This is correct. Here Nanavati admits that he told Commander Samuel that he shot the man as he had seduced his wife. Learned counsel for the accused contends that the question framed was rather involved and, therefore, Nanavati might not have understood its implication. But it appears from the statement that, after the question were answered, Nanavati read his answers and admitted that they were correctly recorded. The answer is also consistent with what Samuel said in his evidence as to what Nanavati told him. This corroborates the evidence of Samuel that Nanavati told him that, as the man had seduced his wife, he thought that he had shot him. Anyhow, the accused did not tell the Court that he told Samuel that he shot the deceased in a fight. Then the accused, leaving Samuel, went to the office of the Deputy Commissioner Lobo. There, he made a statement to Lobo. At that time, Superintendent Korde and Inspector Mokashi were also present. On the information given by him, Lobo directed Inspector Mokashi to take the accused into custody and to take charges of the articles and to investigate the case. 640 Lobo says in his evidence that he received a telephone call from Commander Samuel to the effect that he had directed Commander Nanavati to surrender himself to him as he had stated that J he had shot a, man. This evidence obviously cannot be used to corroborate what Nanavati told Samuel, but it would only be a corroboration of the evidence of Samuel that he telephoned to Lobo to that effect. It is not denied that the accused set up the defence of accident for the first time in the Sessions Court. This conduct of the accused from the time of the shooting of Ahuja to the moment he surrendered himself to the police is inconsistent with the defence that the deceased was shot by accident. Though tho accused had many opportunities to explain himself, he did not do so; and he exhibited the attitude of a man who wreaked out his vengeance in the manner planned by him and was only anxious to make a clean breast of everything to the police. Now we will consider what had happened in the bed room and bath room of the deceased. But before considering the evidence on this question, we shall try to describe the scene of the incident and other relevant particulars regarding the things found therein. The building "Jivan Jyot" is situate in Setalvad Road, Bombay. Ahuja was staying on the first floor of that building. As one goes up the stairs, there is a door leading into the hall; as one enters the hall and walks a few feet towards the north he reaches a door leading into bed room of Ahuja. In the bed room, abutting the southern wall there is a radiogram; just after the radiogram there is a door on the southern wall leading to the bath room, on the eastern side of the door abutting the wall there is a cupboard with a mirror thereon; in the bath room, which is of the dimensions 9 feet x 6 feet, there is a commode in the front along the 641 wall, above the commode there is a window with glass panes overlooking the chowk, on the east of the commode there is a bath tub, on the western side of the bathroom there is a door leading into the hall; on the southern side of the said door there is a wash basin adjacent to the wall. After the incident the corpse of Ahuja was found in the bath room; the head of the deceased was towards the bed room and his legs were towards the commode. He was lying with his head on his right hand. This is the evidence of Miss Mammie, and she has not been cross examined on it. It is also not contradicted by any witness. The top glass pane of the window in the bath room was broken. Pieces of glass were found on the floor of the bath room between the commode and the wash basin. Between the bath tub and the commode a pair of spectacles was lying on the floor and there were also two spent bullets. One chappal was found between the commode and the wash basin, and the other was found in the bedroom. A towel was found wrapped around the waist of the deceased. The floor of the bath room was blood stained. There was white handkerchief and bath towel, which was blood stained lying on the floor. The western wall was found to be blood stained and drops of blood were trickling down. The handle of the door leading to the bath room from the bed room and a portion of the door adjacent to the handle were bloodstained from the inner side. The blood on the wall was little a over three feet from the floor. On the floor of the bed room there was an empty brown envelope with the words "Lt. Commander K. M. Nanavati" written on it. There was no mark showing that the bullets had hit any surface. (See the evidence of Rashmikant, P.W. 16) On the dead body the following injuries were found : (1) A punctured wound 1/4" X 1/4" X chest cavity deep just below and inside the inner 642 end of the right collar bone with an abrasion collar on the right side of the wound. (2) A lacerated punctured wound in the web between the ring finger and the little finger of the left hand 1/4" X 1/4" communicating with a punctured wound 1/4 X 1/4" on the palmer aspect of the left hand at knuckle level between the left little and the ring finger. Both the wounds were communicating. (3) A lacerated ellipsoid wound oblique in the left parietal region with dimensions 1 1/3" X 1/4" X skull deep. (4) A lacerated abrasion with carbonaceous tatooing 1/4" X 1/6" at the distal end of the proximal interphalangeal joint of the left index finger dorsal aspect. That means at the first joint of the crease of the index finger on its dorsal aspect, i.e., back aspect. (5) A lacerated abrasion with carbonaceous tatooing 1/4" X 1/6" at the joint level of the left middle finger dorsal aspect. (6) Vertical abrasion inside the right shoulder blade 3" X 1" just outside the spine. On internal examination the following wounds were found by Dr. Jhala, who performed the autopsy on the dead body. Under the first injury there was: "A small ellipsoid wound oblique in the front of the piece of the breast bone (Sternum) upper portion right side centre with dimensions 1/4" x 1/3" and at the back of the bone there was a lacerated wound accompanied by irregular chip fracture corresponding to external injury No. 1, i, e., the punctured wound chest cavity deep. Same wound continued in the contusion in area 3" x 1 1/4" in the right lung upper lobe front border middle portion front and back. Extensive clots were seen 643 in the middle compartment upper and front part surrounding the laceration impregnated pieces of fractured bone. There was extensive echymosis and contusion around the root of the right lung in the diameter of 2" involving also the inner surface of the upper lobe. There were extensive clots of blood around the aorta. The left lung was markedly pale and showed a through and through wound in the lower lobe beginning at the inner surface just above the root opening out in the lacerated ground in the back region outer aspect at the level between 6th and 7th ribs left side not injuring the rib and injuring the space between the 6th and 7th rib left side 2" outside the junction of the spine obliquely downward and outward. Bullet was recovered from tissues behind the left shoulder blade. The wound was lacerated in the whole tract and was Surrounded by contusion of softer tissues. " The doctor says that the bullet, after entering "the inner end, went backward, downward and then to the left" and therefore he described the ground an ellipsoid and oblique". Ho also points out that the abrasion collar was missing on the left side. Corresponding to the external injury No. 3, the doctor found on internal examination that the skull showed a haematoma under the scalp, i.e., on the left parietal region ; the dimension was 2" X 2". The skull cap showed a gutter fracture of the outer table and a fracture of the inner table. The brain showed sub arachnoid haemorrhage over the left parieto occipital region accompanying the fracture of the vault of the skull. A description of the revolver with which Ahuja was shot and the manner of its working would be necessary to appreciate the relevant evidence in that regard. Bhanagay, the Government 644 Criminologist, who was examined as P.W. 4, describes the revolver and the manner of its working. The revolver is a semi automatic one and it is six chambered. To load the revolver one has to release the chamber; when the chamber is released, it comes out on the left side. Six cartridges can be inserted in the holes of tho chamber and then the chamber is pressed to the revolver. After the revolver is thus loaded, for the purpose of firing one has to pull the trigger of the revolver; when the trigger is pulled the cartridge gets cocked and the revolver being semi automatic the hammer strikes the percussion cap of the cartridge and the cartridge explodes and the bullet goes off. For firing the second shot, the trigger has to be pulled again and the same process will have to be repeated each time it is fired. As it is not an automatic revolver, each time it is fired, the trigger has to be pulled and released. If the trigger is pulled but not released, the second round will not come in its position of firing. Pulling of the trigger has a double action one is the rotating of the chamber and cocking, and the other, releasing of the hammer. Because of this double action, the pull must be fairly strong. A pressure of about 20 pounds is required for pulling the trigger. There is controversy on the question of pressure, and we shall deal with this at the appropriate place. Of the three bullets fired from the said revolver, two bullets were found in the bath room, and the third was extracted from the back of the left shoulder blade. F 2 and F 2a are the bullets found in the bath room. These two bullets are flattened and the copper jacket of one of the bullets, exhibit F 2a, has been turn off. The third bullet is marked as EX. With this background let US now consider the evidence to ascertain whether the shooting was intentional, as the prosecution avers, or only 645 accidental, as the defence suggests. Excepting Nanavati, the accused, and Ahuja, the deceased, no other person was present in the letter 's bed room when the shooting took place. Hence the only person who can speak to the said incident is the accused Nanavati. The version of Nanavati, as given in his evidence may be stated thus: He walked into Ahuja 's bed room, shutting the door behind him. Ahuja was standing in front of the dressing table. The accused walked towards Ahuja and said, "You are a filthy swine", and asked him, "Are you going to marry Sylvia and look after the kids?" Ahuja became enraged and said in a nasty manner, "Do I have to marry every woman that I sleep with ?" Then the deceased said, "Get the hell out of here, otherwise, I will have you thrown out." The accused became angry, but the packet containing the revolver down on a cabinet which was near him and told him, "By God I am going to thrash you for this." The accused had his hands up to fight the deceased, but the latter made a sudden grab towards the packet containing the revolver. The accused grappled the revolver himself and prevented the deceases from getting it. He then whipped out the revolver and told the deceased to get back. The deceased was very close to him and suddenly caught with his right hand the right hand of the accused at the wrist and tried to twist it and take the revolver off it. The accused "banged" the deceased towards the door of the bath room, but Ahuja would not let go of his grip and tried to kick the accused with his knee in the groin. The accused pushed Ahuja again into the bath room, trying at the same time desperately to free his hand from the grip of the accused by jerking it around. The deceased had a very strong grip and he did not let go the grip. During the struggle, the accused thought that two shots went off: one went first and within a few seconds another. At the first shot the deceased just kept 646 hanging on to the hand of the accused, but suddenly he let go his hand and slumped down. When the deceased slumped down, the accused immediately came out of the bath room and walked down to report to the police. By this description the accused seeks to raise the image that he and the deceased were face to face struggling for the possession of the revolver, the accused trying to keep it and the deceased trying to snatch it, the deceased catching hold of the wrist of the right hand of the accused and twisting it, and the accused desperately trying to free his hand from his grip; and in the struggle two shots went off accidentally he does not know about the third shot and hit the deceased and caused his death. But in the cross examination he gave negative answers to most of the relevant questions put to him to test the truthfulness of his version. The following answers illustrate his helpful attitude in the court: (1) I do not remember whether the deceased had the towel on him till I left the place. (2) I had no idea where the shots went because we were shuffling during the struggle in the tiny bath room. (3) I have no impression from where and how the shots were fired. (4) I do not know anything about the rebound of shots or how the shots went off. (5) I do not even know whether the spectacles of the deceased fell off. (6) I do not know whether I heard the third shot. My impression is that I heard two shots. (7) I do not remember the details of the struggle. (8) I do not give any thought whether the shooting was an accident or not, because 647 I wished to go to the police and report to the police. (9) I gave no thought to this matter. I thought that something serious had happened. (10) I cannot say how close we were to each other, we might be very close and we might be at arm 's length during the struggle. (11) I cannot say how the deceased bad his grip on my wrist. (12) I do not remember feeling any blows from the deceased by his free hand during the struggle; but be may have hit me. He gives only a vague outline of the alleged struggle between him and the deceased. Broadly looked at, the version given by the accused appears to be highly improbable. Admittedly he bad entered the bedroom of the deceased unceremoniously with a fully loaded revolver; within half a minute he came out of the room leaving Ahuja dead with bullet wounds. The story of his keeping the revolver on the cabinet is very unnatural. Even if he had kept it there, how did Ahuja come to know that it was a revolver for admittedly it was put in an envelope. Assuming that Ahuja had suspected that it might be a revolver, how could he have caught the wrist of Nanavati who had by that time the revolver in his hand with his finger on the trigger? Even if he was able to do so, how did Nanavati accidental pull the trigger three times and release it three times when already Ahuja was holding his wrist and when he was jerking his hand to release it from the grip of Ahuja ? It also appears to be rather curious that both the combatants did not use their left hands in the struggle. If, as he has said, there was a struggle between them and he pushed Ahuja into the bath room, how was it that the towel wrapped around the waist of Ahuja was intact ? So too, if there was a struggle, why there was no bruise on the body of the accused ? Though Nanavati says that 648 there were some "roughings" on his wrist, he had not mentioned that fact till he gave his evidence in the court, nor is there any evidence to indicate such "roughings". It is not suggested that the Clothes worn by the accused were torn or even soiled. Though there was blood up to three feet on the wall of the bath room, there was not a drop of blood on the clothes of the accused. Another improbability in the version of the accused is, while he says that in the struggle two shots went off, we find three spent bullets two of them were found in the bathroom and the other in the body of the deceased. What is more, how could Ahuja have continued to struggle after he had received either the chest injury or the head injury, for both of them were serious ones. After the deceased received either the first or the third injury there was no possibility of further struggling or pulling of the trigger by reflex action. Dr. Jhala says that the injury on the head of the victim was such that the victim could not have been able to keep standing and would have dropped unconscious immediately and that injury No. 1 was also so serious that he could not stand for more than one or two minutes. Even Dr. Baliga admits that the deceased would have slumped down after the infliction of injury No. 1 or injury No. 3 and that either of them individually would be sufficient to cause the victim to slump down. It is, therefore, impossible that after either of the said two injuries was inflicted, the deceased could have still kept on struggling with the accused. Indeed, Nanavati says in his evidence that at the first shot the deceased just kept on hanging to his hand, but suddenly he let go his grip and slumped down. The only circumstance that could be relied upon to indicate a struggle is that one of the chappals of the deceased was found in the bed room while the other was in the bath room. But that is consistent with both intentional and accidental shooting, for in his anxiety to escape from, the line of 649 firing the deceased might have in hurry left his one chappal in the bed room and fled with the other to the bath room. The situation of the spectacles near the commode is more consistent with intentional shooting than with accidental shootings, for if there had been a struggle it was more likely that the spectacles would have fallen off and broken instead of their being intact by the side of the dead body. The condition of the bed room as well as of the bath room, as described by Rashmikant, the police officer who made the inquiry, does not show any indication of struggle or fight in that place. The version of the accused, therefore, is brimming with improbabilities and is not such that any court can reasonably accept it. It is said that if the accused went to the bedroom of Ahuja to shoot him he would not have addressed him by his first names "Prem" as deposed by Deepak. But Nanavati says in his evidence that he would be the last person to address the deceased as Prem. This must have been an embellishment on the part of Deepak. Assuming he said it, it does not indicate and sentiment of affection or goodwill towards the deceased admittedly he had none towards him but only an involuntary and habitual expression. It is argued that Nanavati is a good shot Nanda, D.W. 6, a Commodore in the Indian Navy, certifies that he is a good shot in regard to both moving and stationary targets and therefore if he had intended to shoot Ahuja, he would have shot him perpendiculary hitting the chest and not in a haphazard way as the injuries indicate. Assuming that accused is a good shot, this argument ignores that he was not shooting at an inanimate target for practice but was shooting to commit murder; and it also ignores the desperate attempts the deceased must have made to escape. The first shot might have been fired and aimed at the chest as 650 soon as the accused entered the room, and the other two presumably when the deceased was trying to escape to or through the bathroom. Now on the question whether three shots would have gone off the revolver accidentally, there is the evidence of Bhanagay, P.W. 4, who is a Government Criminologist. The Deputy Commissioner of Police, Bombay, through Inspector Rangnekar sent to him the revolver, three empty cartridge cases, three bullets and three live rounds for his inspection. He has examined the revolver and the bullets which are marked as Exs. F 2, F 2a and F 3. He is of the opinion that the said three empties were fired from the said revolver. He speaks to the fact that for pulling the trigger a pressure of 28 pounds is required and that for each shot the trigger has to be pulled and for another shot to be fired it must be released and pulled again. He also says that the charring around the wound could occur with the weapon of the type we are now concerned within about 2 to 3 inches of the muzzle of the weapon and the blackening around the wound described as carbonaceous tattooing could be caused from such a revolver up to about 6 to 8 inches from the muzzle. In the cross examination he says that the flattening of the two damaged bullets, Exs. F 2 and F 2a, could have been caused by their hitting a flat hard surface, and that the tearing of the copper jacket of one of the bullets could have been caused by a heavy impact, such as hitting against a hard surface; it may have also been caused, according to him, by a human bone of sufficient strength provided the bullet hits the bone tangently and passes of without obstruction. These answers, if accepted we do not see any reason why we should not accept them prove that the bullets, Exs. F 2 and F 2a, could have been damaged by their coming into contact with some hard substance such as a bone He says in the cross examination that one 'struggling ' will not cause three automatic firings and tha 651 even if the struggle continues he would not expect three rounds to go off, but he qualifies his statement by adding that this may happen if the person holding the revolver "co operates so far as the reflex of his finger is concerned", to pull the trigger. He further elaborates the same idea by saying that a certain kind of reflex co operation is required for pulling the trigger and that this reflex pull could be either conscious or unconscious. This answer is strongly relied upon by learned counsel for the accused in support of his contention of accidental firing. He argues that by unconscious reflex pull of the trigger three times by the accuses three shots could have gone off the revolver. But the possibility of three rounds going off by three separate reflexes of the finger of the person holding the trigger is only a theoretical possibility, and that too only on the assumption of a fairly long struggle. Such unconscious reflex pull of the finger by the accused three times within a space of a few seconds during the struggle as described by the accused is highly improbable, if not impossible. We shall consider the evidence of this witness on the question of ricocheting of bullets when we deal with individual injuries found on the body of the deceased. This witness is not a doctor but has received training Forensic Ballistic Identification of Fire Arms) amongst other things in London and possesses certificates of competency from his tutors in London duly endorsed by the covering letter from the Education Department, high commissioner 's office, and he is a Government Criminologist and has been doing this work for the last 22 years; he says that he has also gained experience by conducting experiments by firing on mutton legs. He stood the test of cross examination exceedingly well and there is no reason to reject his evidence. He makes the following points: (1) Three used bullets, Ers. F 2, F 2a and F 3, were shot from the revolver exhibit B. (2) The revolver can be fired only by 652 Pulling the trigger; and for shooting thrice, a person Shooting will have to give a deep pull to the trigger thrice and release it thrice. (3) A pressure of 28 pounds is required to pull the trigger. (4) one "struggling" will not cause three automatic firings. (5) If the struggle continues and if the person who pulls the trigger co operates by pulling the trigger three times, three shots may go off. (6) The bullet may be damaged by hitting a hard surface or a bone. As we have pointed out the fifth point is only a theoretical possibility based upon two hypothesis, namely, (i) the struggle continues for a considerable time, and (ii) the person holding the trigger Go operates by pulling it thrice by reflex action. This evidence, therefore, establishes that the bullets went off the revolver brought by the accused indeed this is not disputed and that in the course of the struggle of a few seconds as described by the accused, it is not possible that the trigger could have been accidentally pulled three times in quick succession so as to discharge three bullets. As regards the pressure required to pull the trigger of exhibit B, Trilok singh who is the Matter Armorer in the Army, deposing as D.W. 11, does not accept the figure given by the Bhanagay and he would put it at 11 to 14 pounds. we does not know the science of ballistics and he is only a mechanic who repairs the arms. He has not examined the revolver in question. He admits that a double action revolver requires more pressure on the trigger than single action one. While major Burrard in his book on Identification of Fires and Forensic Ballistics says that the normal trigger pull in double action revolvers is about 20 pounds, this witness reduces it to 11 to 14 pounds; while Major Brrard says in his book that in all competitions no test other than a dead weight is accepted, this witness does not agree with him. His opinion is based on the experiments performed 653 with spring balance. We would prefer to accept the opinion of Bhanagay to that of this witness. But, on the basis of the opinion of Major Burrard, we shall assume for the purpose of this case that about 20 pounds of pressure would be required`to pull the trigger of the revolver exhibit B. Before considering the injuries in detail, it may be convenient to ascertain from the relevant text books some of the indications that will be found in the case of injuries caused by shooting. The following passage from authoritative text books may be consulted: Snyder 's Homicide Investigation, P. 117: "Beyond the distance of about 18 inches or 24 at the most evidence of smudging and tattooing are seldom present." Merkeley on Investigation of Death, P. 82: "At a distance of approximately over 18" the powder grains are no longer carried forward and therefore the only effect produced on the skin surface is that of the bullet." Legal Medicine Pathology and Toxicology by Gonzales, 2nd Fdn., 1956: "The powder grains may travel 18 to 24 inches or more depending on the length of barrel, calibre and type of weapon and the type of ammunition. " Smith and Glaister, 1939 Edn., P. 17: "In general with all types of smokeless powder some traces of blackening are to be been but it is not always possible to recognize unburnt grains of powder even at ranges of one and a half feet. " Glaister in his book on Medical Jurisprudence and Toxicology, 1957 Edn. J makes a statement that at 8 range of about 12 inches and over as a rule there will not be marks of carbonaceous tattooing or 654 powder marks. But the same author in an earlier book from which we have already quoted puts it at 18 inches. In the book "Recent Advances in Forensic Medicine" 2nd Edn., p. 11, it is stated: "At range beyond 2 to 3 feet little or no trace of the powder can be observed." Dr. Taylor 's book, Vol. 1, 11th edn., p. 373, contains the following statement: "In revolver and automatic pistol wounds nothing but the grace ring is likely to be found beyond about two feet. " Bhanagay, P.W. 4, says that charring around the wound could occur with the weapon of the type exhibit B within about 2 to 3 inches from the muzzle of the weapon, and the blackening round about the wound could be caused from such a weapon up to about 6 to 8 inches from the muzzle. Dr. Jhala, P.W. 18, ways that carbonaceous tattooing would not appear if the body was beyond 18 inches from the mouth of the muzzle. Dr. Baliga, D.W. 2, accepts the correctness of the statement formed in Glaister 's book, namely, when the range reaches about 6 inches there is usually an absence of burning although there will probably be some evidence of bruising and of powder mark, at a range of about 12 inches and over the skin around the wound does not as a rule show evidence of powder marks. " In the cross examinations witness says that he does not see any conflict in the authorities cited, and tries to reconcile the various authorities by stating that all the authorities show that there would not be powder marks beyond the range of 12 to 18 inches. He also ways that in the matter of tattooing, there is no difference between that caused by smokeless powder used in the cartridge in question, and black powder used in other bullets, though in the case of the former there may be greater difficulty to find 655 out whether tho marks are present are not in a, wound. Having regard to the aforesaid impressive array of authorities on Medical Jurisprudence, we hold, agreeing with Dr. Jhala, that carbonaceous tattooing would not be found beyond range of 18 inches from the mouth of the muzzle of the weapon. We also hold that charring around the wound would occur when it is caused by a revoler like exhibit within about 2 or 3 inches from the muzzle of the revolver. The presence and nature of the abrasion collar around the injury indicates the direction and also the velocity of the bullet. Abrasion collar is formed by the gyration of the bullet caused by the rifling of the barrel. If a bullet hits the body perpendicularly, the wound would be circular and the abrasion collar would be all around. But if the hit is not perpendicular, the abrasion collar will not be around the entire wound(See the evidence of Dr. Jhala and Dr. Baliga). As regards the injuries found on the dead body, two doctors were examined, Dr. Jhala, P. W. 18, on the side of the prosecution, and Dr. Baliga, D. W. 2, on the side of the defence. Dr. Jhala is the Polio Surgeon, Bombay, for the last three years. Prior to that he was a Police Surgeon in Ahmedabad for six years. Ee is M. R. C. P. (Edin.), D.T. M. and H. (Lond.). He conducted the postmortem on the dead body of Ahuja and examined both external and internal injuries on the body. He is therefore, competent to speak with authority on the wounds found on the dead body not only by his qualifications and experience but also by reason of having performed the autopsy on the dead body. Dr. Baliga is an F. R. C. section (England) and has been practising as a medical surgeon since 1933. His qualifications and antecedents show that he is not only on experience surgeon but abo has been taking 656 interest in extra surgical activities, social, political and educational. He says that he has studied medical literature regarding bullet injuries and that he is familiar with medico legal aspect of wound including bullet wounds. He was a Causality J. Medical officer in the K. E. M. Hospital in 1928. The had seen bullet injuries both as Causality Medical officer and later on as a surgeon. In the cross examination he says: "I have never fired a revolver, nor any other fire arm. I have not given evidence in a single case of bullet injuries prior to this occasion though I have treated and I am familiar with bullet injuries. The last that I gave evidence in Medico legal case in a murder case was in 1949 or 1950 or there about. Prior to that I must have given evidence in a medical legal case in about 1939. I cannot off hand tell how many cases of bullet injuries I have treated till now, must have been over a dozen. I have not treated any bullet injuries case for the last 7 or 8 years. It was over 8 or 9 years ago that I have treated bullet injuries on the chest and the head. Out of all these 12 bullet injuries cases which I have treated up to now there might be 4 or 5 which were bullet injuries on the head. Out of these 4 or 5 cases probably there were three cases in which there were injuries both on the chest as well as on the head. . I must have performed about half a dozen postmortems in all my career. " He further says that he was consulted about a week before he gave evidence by Mr. Khandalawala and Mr. Rajani Patel on behalf of the accused and was shown the post mortem report of the injuries; that he did not have before him either the bullets or the skull; that he gave his opinion in about 20 minutes on the basis of the post mortem 657 report of the injuries that the said injuries could have been caused in n struggle between the accused and the deceased. This witness has come to the Court to support his opinion based on scanty material. We are not required in this case to decide upon the cooperative qualification or merits of these two doctors of their relative competency as surgeons, but we must have that so far as the wounds on the legal body of the deceased are concerned, Dr. Jhala, who has made the post mortem examination, is in a better position to help us to ascertain whether shooting was by accident, or by intention than Dr. Baliga, who gave his opinion on the basis of the post mortem report. Now we shall take injury No.1. This injury is a punctured one of dimensions 1/4" x 1/4" chest cavity deep just below and inside the inner end of the right collar bone with an abrasion collar on the right side of tho wound. The internal examination showed that the bullet, after causing the punctured wound in the chest just below the inner end of the right collar bone, struck the sternum and after striking it, it slightly deflected in it course and came behind the shoulder bone. In the course of its journey the bullet entered the chest, impacted the soft tissues of the lung tho aorta and tho left lung, and ultimately damaged the left lung and got lodged behind the seapula. Dr. Jhala describes the wound as ellipsoid and oblique and says that the abrasion collar is missing on the left side. On tho injury there is neither charring nor carbonaceous tattooing. The prosecution version is that this wound was caused by intentional shooting, while the defence suggestion is that it was caused when accused and deceased were struggling for the possession of the revolver. Jhala, after describing injury No. 1, says that it could not has been received by the victim during a struggle in which both the victim and the assailant were us each othor 's grip. Ho gives reasons 658 for his opinion, namely, as there was no carbonaceous tattooing on the injury, it must have been f caused by the revolver being fired from a distance ra of over 18 inches from the tip of the mouth of the muzzle. We have earlier noticed that, on the basis of the authoritative text books and the evidence, there would not be carbonaceous tattooing if the target was beyond 18 inches from the mouth of the muzzle. It is suggested to him in the cross examination that the absence of tattooing may be due to the fact that the bullet might have first hit the fingers of the left palm causing all or any of injuries Nos. 2, 4 and 5, presumably when the deceased placed his left palm against the line of the bullet causing carbonaceous tattooing on the said fingers and thereafter hitting the chest. Dr. Jhala does not admit the possibility of the suggestion. He rules out this possibility because if the bullet first had an impact on the fingers, it would get deflected, lose its direction and would not be able to cause later injury No. 1 with abrasion collar. He further explains that an impact with a solid substance like bones of fingers will make the bullet lose its gyratory movement and thereafter it could not cause any abrasion collar to the wound. He adds, "assuming that the bullet first hit and caused the injury to the web between the little finger and the ring finger, and further assuming that it had not lost its gyrating action, it would not have caused the injury No. 1, i e, on the chest which is accompanied by internal damage and the depth to which it had gone." Now let us see what Dr. Baliga, D. W. 2 says about injury No. 1. The opinion expressed by Dr. Jhala is put to this witness, namely, that injury No. 1 on the chest could not have been caused during the course of a struggle when the victim and the assailant were in each other 's grip, and this witness does not agree with that opinion. He further ways that it is possible that even 659 if the bullet first caused injury in the web, that is injury No. 2, and thereafter caused injury No. 1 in the chest, there would be an abrasion collar such as seen in injury No. 1. Excepting this of this suggestion possibility, he has not controverted the reasons given by Dr. Jhala why inch an abrasion collar could not be caused if the bullet had hit the finger before hitting the chest. We will presently show in considering injuries Nos. 2, 4 and 5 that the said injuries were due to the hit by one bullet. If that be so, a bullet, which had caused the said three injuries and then took a turn through the little and the ring finger, could not have retained sufficient velocity to cause the abrasion collar in the chest. Nor has Dr. Baliga controverted the reasons given by Dr Jhala that even if after causing the injury in the web the bullet could cause injury No. ], it could not have caused the internal damage discovered in the post mortem examination. We have no hesitation, therefore, to accept the well reasoned view of Dr. Jhala in preference to the possibility envisaged by Dr. Baliga and hold that injury No. 1 could not have been caused when the accused and the deceased were in close trip, but only by a shot fired from a distance beyond 18 inches from the mouth of the muzzle. The third injury is a lacerated ellipsoid wound oblique in the left parietal region with dimensions and skull deep. Dr. Jhala in his evidence says that the skull had a gutter fracture of the outer table and a fracture of the inner table and the brain showed subarachnoid haemorrhage over the left parieto oocipital region accompanying the fracture of the vault of the skull. The injury was effect ed in a "glancing way", that is, at a tangent, and the injury went upward and to the front. He is of the opinion that the said injury to the head must have been caused by firing of a bullet from a 660 distance of over 18 inches from the mouth of the muzzle and must have been caused with the back of the head of the victim towards the assailant. When it was suggested to him that the said wound could have been caused by a ricocheted bullet, he answered that though a ricocheted bullet coming from the same line of direction could have caused the said injury, it could not have caused the intracranial haemorrhage and also could not have cause the fracture of tho inner table of the skull. He is definite that injury No. 3 could not have been inflicted from "front to back" as the slope of the gutter fracture was from the back to the front in the direction of the "grazing" of the bullet. He gives a further reasons on that as a rule the fracture wound be broader in the skull where the bullet has the first impact and narrower where it emerges out, whishes the case in respect of injury No 3. He also relies upon the depth of the fracture it the two points and its slope to indicate the direction in which the bullet grazed. He further says that it is common knowledge that the fracture of both the tables accompanied by haemorrhage in the skull requires great force and a ricocheted bullet cannot cause such an injury. He opinion that, though a ricocheted bullet emanating from a powerful fire arm from a close range can cause injury to a heavy bone, it cannot be caused by revolver of the type exhibit B. Another suggestion made to him is that the bullet might have hit the glass pane of the window in the bathroom first and then ricocheting causing the injury on the head. Dr. Jhala in his evidence says that if the bullet had hit glass pane ,first ,it would have caused a hole and fallen on the other side of the window, for ricocheting is not possible in the case of a bullet directly hitting the glass. But on the other hand, if the bullet first hit a hard substances and then the glass pane, it would act like a pebble and crack the glass and would 661 not go to the other side. In the present case, the bullet must have hit the skull first and then the glass pane after having lost its velocity, and fallen down like a pebble inside the bath room itself. If, as the defence suggests, the bullet had directly hit the glass pane, it would have passed through it to the other side, in which case four bullets must have been fired from the revolver exhibit B, which is nobody 's case. The evidence, of Dr. Jhala is corroborated by the evidence of the ballistics expert Bhanagay, P.W. 4, when he says that if a bullet hits a hard substance and gets flattened and damaged like the bullets Exs. F 2 and F 2a, it may not enter the body and that even if it enters the body, the penetration will be shallow and the injury caused thereby will be much less as compared to the injury caused by a direct hit of the bullet. Dr. Baliga, on the other hand, says that injury No. 3 could be caused both ways, that is, from "front backward" as well as from "back forward". He also contradicts Dr. Jhala and says "back that in the type of the gutter fracture caused in the present case the wound is likely to be narrower at the entry than at the exit. He further says that assuming that the gutter fracture wound was caused by a ricocheted bullet and assuming further that there was enough force left after rebound, a ricocheted bullet could cause a fracture of even the inner table and give rise to intra cranial haemorrhage. He asserts that a bullet that can cause a gutter fracture of the outer table is capable of fracturing the inner table also. In short, he contradicts every statement of Dr. Jhala; to quote his own words, "I do not agree that injury No. 3, i.e., the gutter fracture, cannot be inflicted from front to back for the reason that the slope of the gutter fracture was behind forward direction of the grazing of the bullet; I also do not agree with the proposition that if it would have been from the front then the slope of the gutter wound would have been from the front backward; 662 I have not heard of such a rule and that at the near end of the impact of a bullet the gutter fracture is deeper than where it flies off; I do not agree that the depth of the fracture at two points is more important factor in arriving at the conclusion of the point of impact of the bullet. " He also contradicts the opinion of Dr. Jhala that injury No. 3 could not be caused in a struggle between the victim and the assailant. Dr. Baliga has been cross examined at great length. It is elicited from him that he is not a ballistics expert and that his experience in the matter of direction of bullet injuries is comparatively less than his experience in other fields. His opinion that the gutter fracture injury could be and was more likely to be caused from an injury glancing front backwards is based upon a comparison of the photograph of the skull shown to him with the figure 15 in the book "Recent Advances in Forensic Medicine " by Smith and Glaister, p. 21. The said figure is marked as exhibit Z in the case. The witness says that the figure shows that the narrower part of the gutter is on the rear and the wider part is in front. In the cross examination he further says that the widest part of the gutter in figure exhibit Z is neither at the front and nor at the rear end, but the rear end is pointed and tailed. It is put to this witness that figure exhibit Z does not support his evidence and that he deliberately refused to see at it correctly, but he denies it. The learned Judges of the High Court, after seeing the photograph exhibit Z with a magnifying glass, expressed the view that what Dr. Baliga called the pointed and tailed part of the gutter was a crack in the skull and not a part of the gutter. This observation has not been shown to us to be wrong. When asked on what scientific principle he would support his opinion, Dr. Baliga could not give any such principle, but only said that it was likely he puts emphasis on the word "likely" that the striking end was likely to be 663 narrower and little broader at the far end. He agrees that when a conical bullet hits a hard bone it means that the hard bone is protruding in the path of the projectile and also agrees that after the initial impact the bullet adjusts itself in the new direction of flight and that the damage caused at the initial point of the impact would be more than at any subsequent point. Having agreed so far, he would not agree on the admitted hypothesis that at the initial point of contract the wound should be wider than at the exit. But he admits that he has no authority to support his submission. Finally, he admits that generally the breadth and the depth of the gutter wound would indicate the extensive nature of the damage. On this aspect of the case, therefore, the witness has broken down and his assertion is not based on any principle or on sufficient data. The next statement he makes is that he does not agree that the fracture of the inner table shows that the initial impact was from behind; but he admits that the fracture of the inner table is exactly below the backside of the gutter, though he adds that there is a more extensive crack in front of the anterior end of the gutter. He admits that in the case of a gutter on the skull the bone material which dissociates from the rest of the skull is carried in the direction in which the bullet flies but says that he was not furnished with any information in that regard when he gave his opinion. Coming to the question of the ricocheting, he says that a ricocheting bullet can produce depressed fracture of the skull. But when asked whether in his experience he has come across any bullet hitting a hard object like a wall and rebounding and causing a fracture of a hard bone or whether he has any text book to support his statement, he says that he cannot quote any instance nor 664 an authority. But he says that it is so mentioned in several books. Then he gives curious definitions of the expressions "likely to cause death", "necessarily fatal " etc. He would go to the extent of saying that in the case of injury No. 3, the chance of recovery is up to 80 per cent. ; but finally he modifies that statement by saying that he made the statement on the assumption that the haemorrhage in the subarachnoid region is localised, but if the haemorrhage is extensive his answer does not hold good. Though he asserts that at a range of about 12 inches the wound does not show as a rule evidence of powder mark, he admits that he has no practical experience that beyond a distance of 12 inches no powder mark can be discovered as a rule. Though text books and authorities are cited to the contrary, he still sticks to his opinion; but finally he admits that he is not a ballistics expert and has no experience in that line. When he is asked if after injury No. 3, the victim could have continued the struggle, he says that he could have, though he adds that it was unlikely after the victim had received both injuries Nos. 1 and 3. He admits that the said injury can be caused both ways, that is, by a bullet hitting either on the front of the head or at the back of the head. But his reasons for saying that the bullet might have hit the victim on the front of the head are neither supported by principle nor by the nature of the gutter wound found in the skull. exhibit Z relied upon by him does not support him. His theory of a ricocheted bullet hitting the skull is highly imaginary and cannot be sustained on the material available to us: firstly, there is no mark found in the bath room wall or elsewhere indicating that the bullet struck a hard substance before ricocheting and hitting the skull, and secondly, it does not appear to be likely that such a ricocheted bullet ejected from exhibit B could have caused such an extensive injury to the head of the deceased as found in this case. 665 Mr. Pathak finally argues that the bullet exhibit F 2a has a "process", i.e., a projection which exactly fits in the denture found in the skull and, therefore, the projection could have been caused only by the bullet coming into contact with some hard substance before it hit the head of the deceased. This suggestion was not made to any of the experts. It is not possible for us to speculate as to the manner in which the said projection was caused. We, therefore, accept, the evidence of the ballistics expert, P. W. 4, and that of Dr. Jhala, P. W. 18, in preference to that of Dr. Baliga. Now coming to injuries Nos 2, 4 and 5, injury No. 4 is found on the first joint of the crease of the index finger on the back side of the left palm and injury No. 5 at the joint level of the left middle finger dorsal aspect, and injury No. 2 is a punctured wound in the web between the ring finger and the little finger of the left hand communicating with a punctured wound on the palmer aspect of the left knukle level between the left little and the ring finger. Dr. Jhala says that all the said injuries are on the back of the left palm and all have corbonaceous tattooing and that the injuries should have been caused when his left hand was between 6 and 18 inches from the muzzle of the revolver. He further says that all the three injuries could have been caused by one bullet, for, as the postmortem discloses, the three injuries are in a straight line and therefore it can clearly be inferred that they were caused by one bullet which passed through the wound on the palmar aspect. His theory is that one bullet, after causing injuries Nos. 4 and 5 passed between the little and ring finger and caused the punctured wound on the palmar aspect of the left hand. He is also definitely of the view that these wounds could not have been received by the victim during a struggle in which both of them were in each other 's grip. It 666 is not disputed that injury No. 1 and injury No. 3 should have been caused by different bullets. If injuries Nos. 2, 4 and 5 were caused by different bullets, there should have been more than three bullets fired, which is not the case of either the prosecution or the defence. In the circumstances, the said wounds must have been caused only by one bullet, and there is noting improbable in a bullet touching three fingers on the back of the palm and taking a turn and passing through the web between the little and ring finger. Dr. Baliga contradicts Dr. Jhala even in regard to these wounds. He says that these injuries, along with the others, indicate the probability of a struggle between the victim and the assailant over the weapon; but he does not give any reasons for his opinion. He asserts that one single bullet cannot cause injuries Nos. 2, 4 and 5 on the left hand fingers, as it is a circuitous course for a bullet to take and it cannot do so without meeting with some severe resistance. He suggests that a bullet which had grazed and caused injuries Nos. 4 and 5 could then have inflicted injury No. 3 without causing carbonaceous tattooing on the head injury. We have already pointed out that the head injury was caused from the back, and we do not see any scope for one bullet hitting the fingers and thereafter causing the head injury. If the two theories, namely, that either injury No. 1 or injury No. 3 could have been caused by the same bullets that might have caused injury No. 2 and injuries Nos. 4 and 5 were to be rejected, for the aforesaid reasons, Dr. Baliga 's view that injuries Nos. 2,4 and 5 must have been caused by different bullets should also be rejected, for to accept it, we would require more than three bullets emanating from the revolver, whereas it is the common case that more than three bullets were not fired from the revolver. That apart in the cross examination this witness accepts 667 that the injury on the first phalangeal joint of the index finger and the injury in the knuckle of the middle finger and the injury in the web between the little and the ring finger, but not taking into account the injury on the palmar aspect would be in a straight line. The witness admits that there can be a deflection even against a soft tissue, but adds that the soft tissue being not of much thickness between the said two fingers, the amount of deflection is negligible. But he concludes by saying that he is not saying this as an expert in ballistics. If so, the bullet could have deflected after striking the web between the little and the ring finger. We, therefore, accept the evidence of Dr. Jhala that one bullet must have caused these three injuries. Strong reliance is placed upon the nature of injury No. 6 found on the back of the deceased viz, a vertical abrasion in the right shoulder blade of dimensions 3"x1" just outside the spine, and it is said that the injury must have been caused when the accused pushed the deceased towards the door of the bath room. Nanavati in his evidence says that he "banged" him towards the door of the bath room, and after some struggle he again pushed the deceased into the bath room. It is suggested that when the accused "banged" the deceased towards the door of the bath room or when he pushed him again into the bath room, this injury might have been caused by his back having come into contact with the frame of the door. It is suggested to Dr. Jhala that injury No. 6 could be caused by the man 's back brushing against a hard substance like the edge of the door, and he admits that it could be so. But the suggestion of the prosecution case is that the injury must have been caused when Ahuja fell down in the bath room in front of the commode and, when falling, his back may have caught the edge of the commode or the bath tub or the edge of the door of the bath room 668 which opens inside the bath room to the left of the bath tub. Shelat, J., says in his judgment: "If the abrasion was caused when the deceased was said to have been banged against the bath room door or its frame, it would seem that the injury would be more likely to be caused, as the deceased would be in a standing position, on the shoulder blade and not inside the right shoulder. It is thus more probable that the injury was caused when the deceased 's back came into contact either with the edge of the door or the edge of the bathtub or the commode when he slumped. " It is not possible to say definitely how this injury was caused, but it could have been caused when the deceased fell down in the bath room. The injuries found on the dead body of Ahuja are certainly consistent with the accused intentionally shooting him after entering the bed room of the deceased; but injuries Nos. 1 and 3 are wholly inconsistent with the accused accidentally shooting him in the course of their struggle for the revolver. From the consideration of the entire evidence the following facts emerge: The deceased seduced the wife of the accused. She had confessed to him of her illicit intimacy with the deceased. It was natural that the accused was enraged at the conduct of the deceased and had, therefore, sufficient motive to do away with the deceased. He deliberately secured the revolver on a false pretext from the ship, drove to the flat of Ahuja, entered his bed room unceremoniously with a loaded revolver in hand and in about a few seconds thereafter came out with the revolver in his hand. The deceased was found dead in his bath room with bullet injuries on his body. It is not disputed that the bullets that caused injuries to Ahuja emanated from the revolver that was in the hand of the accused. After the shooting, till his 669 trial in the Sessions Court, he did not tell anybody that he shot the deceased by accident. Indeed, he confessed his guilt to the Chowkidar Puransingh and practically admitted the same to his colleague Samuel. His description of the struggle in the bath room is highly artificial and is devoid of all necessary particulars. The injuries found on the body of the deceased are consistent with the intentional shooting and the main injuries are wholly inconsistent with accidental shooting when the victim and the assailant were in close grips. The other circumstances brought out in the evidence also establish that there could not have been any fight or struggle between the accused and the deceased. We, therefore, unhesitatingly hold. agreeing with the High Court, that the prosecution has proved beyond any reasonable doubt that the accused has intentionally shot the deceased and killed him. In this view it is not necessary to consider the question whether the accused had discharged the burden laid on him under section 80 of the Indian Penal Code, especially as learned counsel appearing for the accused here and in the High Court did not rely upon the defence based upon that section. That apart, we agree with the High Court that, on the evidence adduced in this case, no reasonable body of persons could have come to the conclusion which the jury reached in this case. For that reason also the verdict of the jury cannot stand. Even so, it is contended by Mr. Pathak that the accused shot the deceased while deprived of the power of self control by sudden and grave provocation and, therefore, the offence would fall under Exception 1 to section 300 of the Indian Penal Code. The said Exception reads: "Culpable homicide is not murder if the offender, whilst deprived of the power of 670 self control by grave and sudden provocation, causes the death of the person who gave the provocation or causes the death of any other person by mistake or accident". Homicide is the killing of a human being by another. Under this exception, culpable homicide is not murder if the following conditions are complied with : (1) The deceased must have given provocation to the accused. (2) The provocation must be grave. (3) The provocation must be sudden. (4) The offender, by reason of the said provocation, shall have been deprived of his power of self control. (5) He should have killed the deceased during the continuance of the deprivation of the power of self control. (6) The offender must have caused the death of the person who gave the provocation or that of any other person by mistake or accident. The first question raised is whether Ahuja gave provocation to Nanawati within the meaning of the exception and whether the provocation, if given by him, was grave and sudden. Learned Attorney General argues, that though a confession of adultery by a wife may in certain circumstances be provocation by the paramour himself, under different circumstances it has to be considered from the standpoint of the person who conveys it rather than from the standpoint of the person who gives it. He further contends that even if the provocation was deemed to have been given by Ahuja, and though the said provocation might have been grave, it could not be sudden, for the provocation given by Ahuja was only in the past. On the other hand, Mr. Pathak contends that the act of Ahuja, namely, the seduction of Sylvia, gave provocation though the fact of seduction was communicated to the accused by Sylvia and that for the ascertainment of the suddenness 671 of the provocation it is not the mind of the person who provokes that matters but that of the person provoked that is decisive. It is not necessary to express our opinion on the said question, for we are satisfied that, for other reasons, the case is not covered by Exception 1 to section 300 of the Indian Penal Code. The question that the Court has to consider is whether a reasonable person placed in the same position as the accused was, would have reacted to the confession of adultery by his wife in the manner in which the accused did. In Mancini vs Director of Public Prosecutions (1), Viscount Simon, L. C., states the scope of the doctrine of provocation thus: "It is not all provocation that will reduce the crime of murder to manslaughter. Provocation, to have that result, must be such as temporarily deprives the person provoked of the power of self control as the result of which he commits the unlawful act which causes death. . The test to be applied is that of the effect of the provocation on a reasonable man, as was laid down by the Court of Criminal Appeal in Rex vs Lesbini, so that an unusually excitable or pugnacious individual is not entitled to rely on provocation which would not have led an ordinary person to act as he did. In applying the text, it is of particular importance to (a) consider whether a sufficient interval has elapsed since the provocation to allow a reasonable man time to cool, and (b) to take into account the instrument with which the homicide was effected, for to retort, in the heat of passion induced by provocation, by a simple blow, is a very different thing from making use of a deadly instrument like a concealed dagger. In short, 672 the mode of resentment must bear a reasonable relationship to the provocation if the offence is to be reduced to manslaughter." Viscount Simon again in Holmes vs Director of Public Prosecutions elaborates further on this theme. There, the appellant had entertained some suspicions of his wife 's conduct with regard to other men in the village. On a Saturday night there was a quarrel between them when she said, "Well, if it will ease your mind, I have been untrue to you", and she went on, "I know I have done wrong, but I have no proof that you haven 't at Mrs. X. 's". With this appellant lost his temper and picked up the hammerhead and struck her with the same on the side of the head. As he did not like to see her lie there and suffer, he just put both hands round her neck until she stopped breathing. The question arose in that case whether there was such provocation as to reduce the offence of murder to manslaughter. Viscount Simon, after referring to Mancini 's case(2), proceeded to state thus : "The whole doctrine relating to provocation depends on the fact that it causes, or may cause, a sudden and temporary loss of self control, whereby malice, which is the formation of an intention to kill or to inflict grievous bodily harm, is negatived. Consequently, where the provocation inspires an actual intention to kill (such as Holmes admitted in the present case), or to inflict grievous bodily harm, the doctrine that provocation may reduce murder to manslaughter seldom applies. " Goddard, C. J., Duffy 's case defines provocation thus "Provocation is some act, or series of acts, done by the dead man to the accused 673 which would cause in any reasonable person, and actually causes in the accused, a sudden and temporary loss of self control, rendering the accused so subject to passion as to make him or her for the moment not master of his mind. . What matters is whether this girl (the accused) had the time to say : `Whatever I have suffered, whatever I have endured, I know that Thou shall not kill. ' That is what matters. Similarly,. . .circumstances which induce a desire for revenge, or a sudden passion of anger, are not enough. Indeed, circumstances which induce a desire for revenge are inconsistent with provocation, since the conscious formulation of a desire for revenge means that the person has had time to think, to reflect, and that would negative a sudden temporary loss of self control which is of the essence of provocation. Provocation being,,. . .as I have defined it, there are two things, in considering it, to which the law attaches great importance. The first of them is, whether there was what is sometimes called time for cooling, that is, for passion to cool and for reason to regain dominion over the mind. . . Secondly in considering whether provocation has or has not been made out, you must consider the retaliation in provocation that is to say, whether the mode of resentment bears some proper and reasonable relationship to the sort of provocation that has been given." A passage from the address of Baron Parke to the jury in R. vs Thomas (1) extracted in Russell on Crime, 11th ed., Vol. I at p. 593, may usefully be quoted : 674 "But the law requires two things : first that there should be that provocation; and secondly, that the fatal blow should be clearly traced to the influence of passion arising from that provocation." The passages extracted above lay down the following principles: (1) Except in circumstances of most extreme and exceptional character, a mere confession of adultery is not enough to reduce the offence of murder to manslaughter. (2) The act of provocation which reduced the offence of murder to manslaughter must be such as to cause a sudden and temporary loss of self control; and it must be distinguished from a provocation which inspires an actual intention to kill. (3) The act should have been done during the continuance of that state of mind, that is, before there was time for passion to cool and for reason to regain dominion over the mind. (4) The fatal blow should be clearly traced to the influence of passion arising from the provocation. On the other hand, in India, the first principle has never been followed. That principle has had its origin in the English doctrine that mere words and gestures would not be in point of law sufficient to reduce murder to manslaughter. But the authors of the Indian Penal Code did not accept the distinction. They observed : "It is an indisputable fact, that gross insults by word or gesture have as great tendency to move many persons to violent passion as dangerous or painful bodily in juries ; nor does it appear to us that passion excited by insult is entitled to less indulgence than passion excited by pain. On the contrary, the circumstance that a man resents an insult more than a wound is anything but 675 a proof that he is a man of peculiarly bad heart." Indian courts have not maintained the distinction between words and acts in the application of the doctrine of provocation in a given case. The Indian law on the subject may be considered from two aspects, namely, (1) whether words or gestures unaccompanied by acts can amount to provocation and (2) what is the effect of the time lag between the act of provocation and the commission of the offence. In Empress vs Khogayi, a division bench of the Madras High Court held, in the circumstances of that case, that abusive language used would be a provocation sufficient to deprive the accused of self control. The learned Judges observed : "What is required is that it should be of a character to deprive the offender of his self control. In determining whether it was so, it is admissible to take into account the condition of mind in which the offender was at the time of the provocation. In the present case the abusive language used was of the foulest kind and was addressed to man already enraged by the conduct of deceased 's son. " It will be seen in this case that abusive language of the foulest kind was held to be sufficient in the case of man who was already enraged by the conduct of deceased 's son. The same learned Judge in a later decision in Boya Munigadu vs The Queen upheld plea of grave and sudden provocation in the following circumstances: The accused saw the deceased when she had cohabitation with his bitter enemy; that night he had no meals; next morning he went to the ryots to get his wages from them, and at that time he saw his wife eating food along with her paramour; he killed the paramour with a bill hook. The learned 676 Judges held that the accused had sufficient provocation to bring the case within the first exception to section 300 of the Indian Penal Code. The learned Judges observed : ". . If having witnessed the act of adultery, he connected this subsequent conduct as he could not fail to connect it, with that act, it would be conduct of a character highly exasperating to him, implying as it must, that all concealment of their criminal relations and all regard for his feelings were abandoned and that they purposed continuing their course of misconduct in his house. This, we think, amounted to provocation, grave enough and sudden enough to deprive him of his self control, and reduced the offence from murder to culpable homicide not amounting to murder. " The case illustrates that the state of mind of the accused, having regard to the earlier conduct of the deceased, may be taken into consideration in considering whether the subsequent act would be a sufficient provocation to bring the case within the exception. Another division bench of the Madras High Court in In re Murugian held that, where the deceased not only committed adultery but later on swore openly in the face of the husband that she would persist in such adultery and also abused the husband for remonstrating against such conduct, the case was covered by the first exception to section 300 of the Indian Penal Code. The judgement of the Andhra Pradesh High Court in In re C. Narayan adopted the same reasoning in a case where the accused, a young man, who had a lurking suspicion of the conduct of his wife, who newly joined him, was confronted with the confession of illicit intimacy with, and consequent pregnancy by another, strangled his wife to death, and 677 held that the case was covered by Exception 1 to section 300 of the Indian Penal Code. These two decisions indicate that the mental state created by an earlier act may be taken into consideration in ascertaining whether a subsequent act was sufficient to make the assailant to lose his self control. Where the deceased led an immoral life and her husband, the accused, upbraided her and the deceased instead of being repentant said that she would again do such acts, and the accused, being enraged struck her and, when she struggled and beat him, killed her, the Court held the immediate provocation coming on top of all that had gone before was sufficient to bring the case within the first exception to section 300 of the Indian Penal Code. So too, where a woman was leading a notoriously immoral life, and on the previous night mysteriously disappeared from the bedside of her husband and the husband protested against her conduct, she vulgarly abused him, whereupon the husband lost his self control, picked up a rough stick, which happened to be close by and struck her resulting in her death, the Lahore High Court, in Jan Muhammad vs Emperor, held that the case was governed by the said exception. The following observations of the court were relied upon in the present case : "In the present case my view is that, in judging the conduct of the accused, one must not confine himself to the actual moment when the blow, which ultimately proved to be fatal was struck, that is to say, one must not take into consideration only the event which took place immediately before the fatal blow was struck. We must take into consideration the previous conduct of the woman. . . . . . . . . . . . . As stated above, the whole unfortunate affair 678 should be looked at as one prolonged agony on the part of the husband which must have been preying upon his mind and led to the assault upon the woman, resulting in her death." A division bench of the Allahabad High Court in Emperor vs Balku invoked the exception in a case where the accused and the deceased, who was his wife 's sister 's husband, were sleeping on the same cot, and in the night the accused saw the deceased getting up from the cot, and going to another room and having sexual intercourse with his (accused 's) wife, and the accused allowed the deceased to return to the cot, but after the deceased fell asleep, he stabbed him to death. The learned Judges held : "When Budhu (the deceased) came into intimate contact with the accused by lying beside him on the charpai this must have worked further on the mind of the accused and he must have reflected that `this man now lying beside me had been dishonouring me a few minutes ago '. Under these circumstances we think that the provocation would be both grave and sudden. " The Allahabad High Court in a recent decision, viz., Babu Lal vs State applied the exception to a case where the husband who saw his wife in a compromising position with the deceased killed the latter subsequently when the deceased came, in his absence, to his house in another village to which he had moved. The learned Judges observed : "The appellant when he came to reside in the Government House Orchard felt that he had removed his wife from the influence of the deceased and there was no more any contact between them. He had lulled himself into a false security. This belief was shattered 679 when he found the deceased at his hut when he was absent. This could certainly give him a mental jolt and as this knowledge will come all of a sudden it should be deemed to have given him a grave and sudden provocation. The fact that he had suspected this illicit intimacy on an earlier occasion also will not alter the nature of the provocation and make it any the less sudden. " All the said four decisions dealt with a case of a husband killing his wife when his peace of mind had already been disturbed by an earlier discovery of the wife 's infidelity and the subsequent act of her operated as a grave and sudden provocation on his disturbed mind. Is there any standard of a reasonable man for the application of the doctrine of "grave and sudden" provocation ? No abstract standard of reasonableness can be laid down. What a reasonable man will do in certain circumstances depends upon the customs, manners, way of life, traditional values etc. ; in short, the cultural, social and emotional background of the society to which an accused belongs. In our vast country there are social groups ranging from the lowest to the highest state of civilization. It is neither possible nor desirable to lay down any standard with precision : it is for the court to decide in each case, having regard to the relevant circumstances. It is not necessary in this case to ascertain whether a reasonable man placed in the position of the accused would have lost his self control momentarily or even temporarily when his wife confessed to him of her illicit intimacy with another, for we are satisfied on the evidence that the accused regained his self control and killed Ahuja deliberately. The Indian law, relevant to the present enquiry, may be stated thus : (1) The test of "grave 680 and sudden" provocation is whether a reasonable man, belonging to the same class of society as the accused, placed in the situation in which the accused was placed would be so provoked as to lose his self control. (2) In India, words and gestures may also, under certain circumstances, cause grave and sudden provocation to an accused so as to bring his act within the first Exception to section 300 of the Indian Penal Code. (3) The mental background created by the previous act of the victim may be taken into consideration in ascertaining whether the subsequent act caused grave and sudden provocation for committing the offence. (4) The fatal blow should be clearly traced to the influence of passion arising from that provocation and not after the passion had cooled down by lapse of time, or otherwise giving room and scope for premeditation and calculation. Bearing these principles in mind, let us look at the facts of this case. When Sylvia confessed to her husband that she had illicit intimacy with Ahuja, the latter was not present. We will assume that he had momentarily lost his self control. But if his version is true for the purpose of this argument we shall accept that what he has said is true it shows that he was only thinking of the future of his wife and children and also of asking for an explanation from Ahuja for his conduct. This attitude of the accused clearly indicates that he had not only regained his self control, but on the other hand, was planning for the future. Then he drove his wife and children to a cinema, left them there, went to his ship, took a revolver on a false pretext, loaded it with six rounds, did some official business there, and drove his car to the office of Ahuja and then to his flat, went straight to the bed room of Ahuja and shot him dead. Between 1 30 P.M., when he left his house, and 4 20 P.M., when the murder took place, three hours had elapsed, and therefore there was sufficient time for him to 681 regain his self control, even if he had not regained it earlier. On the other hand, his conduct clearly shows that the murder was a deliberate and calculated one. Even if any conversation took place between the accused and the deceased in the manner described by the accused though we do not believe that it does not affect the question, for the accused entered the bed room of the deceased to shoot him. The mere fact that before the shooting the accused abused the deceased and the abuse provoked an equally abusive reply could not conceivably be a provocation for the murder. We, therefore, hold that the facts of the case do not attract the provisions of Exception 1 to section 300 of the Indian Penal Code. In the result, conviction of the accused under section 302 of the Indian Penal Code and sentence of imprisonment for life passed on him by the High Court are correct, and there are absolutely no grounds for interference. The appeal stands dismissed. Appeal dismissed.

Appellant Nanavati, a Naval Officer, was put up on trial under sections 302 and 304 Part I of the Indian Penal Code for the alleged murder of his wife 's paramour. The prosecution case in substance was that on the day of occurrence his wife Sylvia confessed to him of her illicit intimacy with Ahuja and the accused went to his ship, took from its stores a revolver and cartridges on a false pretext, loaded the same, went to Ahuja 's flat, entered his bed room and shot him dead. The defence, inter alia, was that as his wife did not tell him if Ahuja would marry her and take charge of their children, he decided to go and settle the matter with him. He drove his wife and children to a cinema where he dropped them promising to pick them up when the show ended at 6 p.m., drove to the ship and took the revolver and the cartridges on a false pretext intending to shoot himself. Then he drove 568 his car to Ahuja 's office and not finding him there, drove to his flat. After an altercation a struggle ensued between the two and in course of that struggle two shots went off accidentally and hit Ahuja. Evidence, oral and documentary, was adduced in the case including three letters written by Sylvia to Ahuja. Evidence was also given of an extra judicial confession made by the accused to prosecution witness 12 who deposed that the accused when leaving the place of occurrence told him that he had a quarrel with Ahuja as the latter had 'connections ' with his wife and therefore he killed him. This witness also deposed that he told P. W. 13, Duty Officer at the Police Station, what the accused had told him. This statement was not recorded by P. W. 13 and was denied by him in his cross examination. In his statement to the investigation officer it was also not recorded. The jury returned a verdict of 'not guilty ' on both the charges by a majority of 8: 1. The Sessions Judge disagreed with that verdict, as in his view, no reasonable body of men could bring that verdict on the evidence and referred the matter to the High Court under section 307 of the Code of Criminal Procedure. The two Judges of the Division Bench who heard the matter agreed in holding that the appellant was guilty under section 302 of the Indian Penal Code and sentenced him to undergo rigorous imprisonment for life. One of them held that there were misdirections in the Sessions Judge 's charge to the jury and on a review of the evidence came to the conclusion that the accused was guilty of murder and the verdict of the jury was perverse. The other Judge based his conclusion on the ground that no reasonable body of persons could come to the conclusion that jury had arrived at. On appeal to this Court by special leave it was contended on behalf of the appellant that under section 307 of the Code of Criminal Procedure it was incumbent on the High Court to decide the competency of the reference on a perusal of the order of reference itself since it had no jurisdiction to go into the evidence for that purpose, that the High Court was not empowered by section 307(3) of the Code to set aside the verdict of the jury on the ground that there were misdirections in the charge, that there were no misdirections in the charge nor was the verdict perverse and that since there was grave and sudden provocation the offence committed if any, was not murder but culpable homicide not amounting to murder. ^ Held, that the connections were without substance and the appeal must fail. Judged by its historical background and properly construed, section 307 of the Code of Criminal Procedure was meant to confer wider powers of interference on the High Court than 569 in an appeal to safeguard against an erroneous verdict of the jury. This special jurisdiction conferred on the High Court by section 307 of the Code is essentially different from its appellate jurisdiction under sections 410 and 417 of the code, section 423(2) conferring no powers but only saving the limitation under section 418(1), namely, that an appeal against an order of conviction or an acquittal in a jury trial must be confined to matters of law. The words "for the ends of justice" in section 307(1) of the Code, which indicate that the Judge disagreeing with the verdict, must be of the opinion that the verdict was one which no reasonable body of men could reach on the evidence, coupled with the words 'clearly of the opinion ' gave the Judge a wide and comprehensive discretion to suit different situations. Where. therefore, the Judge disagreed with the verdict and recorded the grounds of his opinion, the reference was competent, irrespective of the question whether the Judge was right in so differing from the jury or forming such an opinion as to the verdict. There is nothing in section 307(1) of the Code that lends support to the contention that though the Judge had complied with the necessary conditions, the High Court should reject the reference without going into the evidence if the reasons given in the order of reference did not sustain the view expressed by the Judge. Section 307(3) of the Code by empowering the High Court either to acquit or convict the accused after considering the entire evidence, giving due weight to the opinions of the Sessions Judge and the jury, virtually conferred the functions both of the jury and the Judge on it. Where, therefore, misdirections vitiated the verdict of the jury, the High Court had as much the power to go into the entire evidence in disregard of the verdict of the jury as it had when there were no misdirections and interfere with it if it was such as no reasonable body of persons could have returned on the evidence. In disposing of the reference, the High Court could exercise any of the procedural powers conferred on it by section 423 or any other sections of the Code. Ramanugarh Singh vs King Emperor, (1946) L.R. 73 I. A. 174, Akhlakali Hayatalli vs State of Bombay, ; , Ratan Rai vs State of Bihar, , Sashi Mohan Debnath vs State of West Bengal , and Emperor vs Ramdhar Kurmi, A. I. R. 1948 Pat. 79, referred to. A misdirection is something which the judge in his charge tells the jury and is wrong or in a wrong manner 570 tending to mislead them. Even an omission to mention matters which are essential to the prosecution or the defence case in order to help the jury to come to a correct verdict may also in certain circumstances amount to a misdirection. But in either case, every misdirection or non direction is not in itself sufficient to set aside a verdict unless it can be said to have occasioned a failure of justice. Mustak Hussein vs State of Bombay [1953] section C. R. 809 and Smt. Nagindra Bala Mitra vs Sunil Chandra Roy, ; , referred to. There is no conflict between the general burden that lies on the prosecution in a criminal case and the special burden imposed on the accused under section 105 of the Evidence Act where he pleads any of the General Exceptions mentioned in the Indian Penal Code. The presumption of innocence in the favour of the accused continues all through and the burden that lies on the prosecution to prove his guilt, except where the statute provides otherwise, never shifts. Even if the accused fails to prove the Exception the prosecution has to discharge its own burden and the evidence adduced, although insufficient to establish the Exception, may be sufficient to negative one or more of the ingredients of the offence. Woolmington vs Director of Public Prosecutions, L. R. ; , considered. Attygalle vs Emperor, A. I. R. 1936 P. C. 169, distinguished. State of Madras vs A. Vaidyanatha Iyer, ; and C. section D. Swamy vs State, ; , referred to. Consequently, where, as in the instant case, the accused relied on the Exception embodied in section 80 of the Indian Penal Code and the Sessions Judge omitted to point out to the jury the distinction between the burden that lay on the prosecution and that on the accused and explain the implications of the terms 'lawful act ', lawful manner ', 'unlawful means ' and 'with proper care and caution ' occurring in that section and point out their application to the facts of the case these were serious misdirections that vitiated the verdict of the jury. Extra judicial confession made by the accused is a direct piece of evidence and the stringent rule of approach to circumstantial evidence has no application to it. Since in the instant case, the Sessions Judge in summarising the circumstances mixed up the confession with the circumstances while directing the jury to apply the rule of circumstantial evidence and 571 it might well be that the jury applied that rule to it, his charge was vitiated by the grave misdirection that must effect that correctness of the jury 's verdict. The question whether the omission to place certain evidence before the jury amounts to a misdirection has to be decided on the facts of each case. Under section 297 of the Code of Criminal Procedure it is the duty of the Sessions Judge after the evidence is closed and the counsel for the accused and the prosecution have addressed the jury, to sum up the evidence from the correct perspective. The omission of the Judge in instant case, therefore, to place the contents of the letters written by the wife to her paramour which in effect negatived the case made by the husband and the wife in their deposition was a clear misdirection. Although the letters were read to jury by the counsel for the parties, that did not absolve the judge from his clear duty in the matter. R. V. Roberts, and R. vs Affield, , held inapplicable. The commencement of investigation under section 156 (1) of the Code of Criminal Procedure in a particular case, which is a question of fact, has to be decided on the facts of the case, irrespective of any irregularity committed by the Police Officer in recording the first information report under section 154 of the Code. Where investigation had in fact commenced, as in the instant case, section 162 of the Code was immediately attracted. But the proviso to that section did not permit the eliciting from a prosecution witness in course of his cross examination of any statement that he might have made to the investigation officer where such statement was not used to contradict his evidence. The proviso also had no application to a oral statement made during investigation and not reduced to writing. In the instant case, therefore, there could be no doubt that the Sessions Judge acted illegally in admitting the evidence of P. W. 13 to contradict P. W. 12 in regard to the confession of the accused and clearly misdirected himself in placing the said evidence before the jury. Exception 1 to section 300 of the Indian Penal Code could have no application to the case. The test of "grave and sudden" provocation under the Exception must be whether a reasonable person belonging to the same class of society as the accused, placed in a similar situation, would be so provoked as to lose his self control. In India, unlike in England, words and gestures may, under certain circumstances cause grave and sudden provocation so as to attract that Exception. The mental background created by any previous act of the victim can 572 also be taken into consideration in judging whether the subsequent act could cause grave and sudden provocation, but the fatal blow should be clearly traced to the influence of the passion arising from that provocation and not after the passion had cooled down by lapse of time or otherwise, giving room and scope for premeditation and calculation. Mancini vs Director of Public Prosecutions, L.R. (1942) A.C. I, Holmes vs Director of Public Prosecutions, L. R. Duffy 's case, [1949]1 All. E. R. 932 and R. vs Thomas, ; , considered. Empress vs Khogayi, Mad. 122, Boya Munigadu vs The Queen, Mad. 33, In re Murugian I. L. R. , In re C. Narayan, A.I.R. 1958 A. P. 235, Jan Muhammad vs Emperor, I. L. R. , Emperor vs Balku, I. L. R. (1938) All 789 and Babu Lal vs State A. I. R. 1960 All. 223, referred to. Semble: Whether a reasonable person in the circumstances of a particular case committed the offence under grave and sudden provocation is a question of fact for the jury to decide. Holmes vs Director of Public Prosecution, L. R. , considered.

Civil Appeals Nos. 258 259 of 59 and 404 of 60. Appeals by special leave from the judgment and orders dated July 2, 1956, January 9, 1957 and June 16,1958 of the Bombay High Court in Special Civil Applications Nos. 1471, 1527 and 2990 of 56 and 1431 of 1958 respectively. V.M. Limaye, V.L. Narasimha Moorthy, E. Udayaratnam and S.S. Shukla, for the appellants. B.C. Kamble and A.G. Ratnaparkhi, for respondents Nos. 1 and 3 (in C. section No. 258/59). S.G. Patwardhan, B.C. Kamble and A.G. Ratnaparkhi, for respondent No. 1 ( in C. A. No. 259/59) and the respondent in (C.A. No. 404 of 60). Rameshwar Nath, for the respondent (in C.A. No. 9 of 60). December 1. The Judgment of the Court was delivered by SARKAR, J. These four appeals are by landlords whose applications to the authorities under the Bombay Tenancy and Agricultural Lands Act, 1948 for possession of the lands held by their tenants, on the grounds had that the tenancy had been terminated by due notices on the tenants ' failure to pay rents for three years, were dismissed. 741 These authorities refused in three of these cases to make an order for possession either because the tenants had paid up all rent which had fallen in arrear or because the authorities thought it proper on the facts of the case to give them time to pay up. They felt that the tenants were entitled to relief against forfeiture on equitable principles. In the fourth case, which is covered by Civil Appeal No. 259 of 1959, it was held that there had not been on the facts of the case, default in payment of rent for three years and, therefore the tenant was entitled to statutory relief against eviction under section 25(1) of the Act which we shall later set out. The High Court at Bombay by a summary order, without stating any reasons, refused to interfere when moved under article 227 of the Constitution. The landlords have therefore filed these appeals with leave of this Court. We shall now deal with the first three cases and later take up the fourth case. In these three cases relief was granted to the tenants on the basis of certain observation of the High Court at Bombay in Sitaram Vithal Chitnis vs Gundu Satyappa Dhade, Special Civil Application No. 1695 of 1955, unreported, which we quote here: "Every court of equity will be extremely reluctant to enforce an order of ejectment against a tenant when the only ground on which the landlord seeks ejectment is failure to pay rent. Therefore, if the tenant is willing to pay all arrears of rent, in our opinion, it would be inequitable to turn these tenants out when they are prepared to make good the arrears of rent. " With great respect to the learned Judges of the High Court, we are unable to assent to the proposition so broadly put. We now set out the relevant provisions of the Act. 742 section 5 (1) No tenancy of any land shall be for a period of less than ten years: Provided that at the end of the said period and thereafter at the end of each period of ten years in succession, the tenancy shall, subject to the provisions of sub secs. (2) and (3), be deemed to be renewed for a further period of ten years on the same terms and conditions notwithstanding any agreement to the contrary. (2) x x x x x x x x x x x x x x x x x x x x x x (3) Notwithstanding anything contained in sub sec. (1): (a) every tenancy shall, subject to the provisions of sections 24 and 25, be liable to be terminated at any time on any of the grounds mentioned in section 14. x x x x x x x x x x x x x x x x x x x x x x x x section 14(1) Notwithstanding any agreement, usage, decree, or order of a court of law, the tenancy of any land held by a tenant shall not be terminated unless such tenant: (a)(1) has failed to pay in any year, with in fifteen days from the day fixed. the rent of such land for that year. x x x x x x x x x x x x x x x x Provided that no tenancy of any land held by a tenant shall be terminated on any of the grounds mentioned in this sub section unless the landlord gives three months ' notice in writing intimating the tenant his decision to terminate the tenancy and ground for such termination. 743 section 25(1)Where any tenancy of any land held by any tenant is terminated for non payment of rent and the landlord files any proceeding to eject the tenant, the Mamlatdar shall call upon the tenant to tender to the landlord the rent in arrears together with the costs of the proceeding within fifteen days from the date of order, and if the tenant complies with such order, the Mamlatdar shall, in lieu of making an order for ejectment, pass an order that the tenancy had not been terminated, and thereupon the tenant shall hold the land as if the tenancy had not been terminated: Provided that if the Mamlatdar is satisfied that in consequence of total or partial failure of crops or similar calamity the tenant has been unable to pay the rent due, the Mamlatdar may, for reasons to be recorded in writing, direct that the arrears of rent together with the costs of the proceedings if awarded, shall be paid within one year from the date of the order and that if before the expiry of the said period, the tenant fails to pay the said arrears of rent and costs, the tenancy shall be deemed to be terminated and the tenant shall be liable to be evicted. (2) Nothing in this section shall apply to any tenant whose tenancy is terminated for non payment of rent if he has failed for any three years to pay rent within the period specified in section 14. section 29(1) A tenant or an agricultural labourer or an artisan entitled to possession of any land or dwelling house under any of the provisions of this Act may apply in writing for such possession to the Mamlatdar. x x x x x x x x x x x x x x x x x x x x x x x x 744 (2) No landlord shall obtain possession of any land or dwelling house held by a tenant except under an order of the Mamlatdar. For obtaining such order he shall make an application in the prescribed form and within a period of two years from the date on which the right to obtain possession of the land or dwelling house, as the case may be, is deemed to have accrued to him. (3) On receipt of such application under sub section (1) or (2) the Mamlatdar shall, after holding an enquiry, pass such order thereon as he deems fit. We are not concerned in these three cases with section 24 mentioned in section 5(3)(a). The "date fixed" mentioned in section 14(1)(a)(i) is it may be stated the 20th of March of each year. It is not in dispute in these cases that the tenants were in default in paying rents for three years within section 14(1)(a)(i) and due notices had been served by the landlords terminating the tenancies as required by the proviso to section 14(1). By section 5, therefore, a tenancy under the Act is made to have indefinite duration being renewable for ten years at the end of every ten years and the landlord cannot put an end to the tenancy except under the provisions of the Act, one of which is section 14. This is irrespective of any contract between the parties. Under section 14 on the default in payment of a year 's rent occurring, the landlord may, if he so chooses, bring the tenancy to end by giving the prescribed notice. If the tenancy is terminated, the tenant has, of course, no right to hold the land. The landlord would then be entitled to recover possession of the land from him. In view however of section 29(2), the landlord cannot do so except by an application made to a Mamlatdar for the purpose. Now when such an application is made in case where the tenant has been in default for not 745 more than two years, section 25(1) would have to be applied and the Mamlatdar would have to give the tenant a chance to pay up and thereby annul the termination of the tenancy brought about under section 14. In these three cases there is no controversy that the tenancies have been terminated under section 14. There is also no dispute that the tenants are not entitled to be relieved against that termination under sub section (1) of section 25 because of the provisions of sub sec. (2) of that section, as in these cases the rent had not been paid for three years. They however claim relief on the principle on which equity grants relief against forfeiture of tenancies. The authorities under the Act have granted them the relief by applying this equitable principle. In our opinion, the authorities were clearly in error in thinking that they could grant relief in these cases on equitable principles. In equity relief may be granted to a tenant who has incurred a forfeiture under the terms of the tenancy, that is, his contract with the landlord. Here, that is not the position. The tenancies have been terminated in these cases under a statutory provision. In the circumstances that have happened, the landlords have in our opinion acquired a statutory right to the possession of the lands and, therefore, to eject the tenants, the reasons for which view we shall discuss in some detail later. In such a case, no relief can be granted to the tenants on equitable principles. Equity does not operate to annul a statute. This appears to us to be well established but we may refer to white and Tudors Leading Cases in Equity (9th ed.) p. 238, where it is stated, "Although, in cases of contract between parties, equity will often relieve against penalties and forfeitures, where compensation can be granted, relief can never be given against the provisions of a statute. " 746 The order of the authorities taking away the landlords ' statutory right to possession by application of rules of equity cannot be supported. It was then said that section 29(3) gives ample power to the authorities to refuse to make an order for possession in the landlord 's favour if the tenant pays up the arrears and the justice of the case requires that the tenant should not be deprived of the land. That sub section no doubt says that the Mamlatdar "shall. pass such order thereon as he deems fit". We are however wholly unable to agree that this provision warrants the making of any order that the authority concerned thinks in his individual opinion that the justice of the case requires. We may here refer to R. vs Boteler where a statute which conferred power upon Justices to issue a distress warrant "if they shall think fit" was considered. In that case the Justices had refused to issue the distress warrant. Cockburn C. J. observed, "They went upon the ground that the introduction of this extra parochial place into the union was a thing unjust in itself; in other words, that the operation of the act of parliament was unjust. I think, therefore it amounts virtually to saying, 'We know that we ought upon all other grounds to issue the warrant, but we will take upon ourselves to say that the law is unjust, and we will not carry out the law '. That is not such an exercise of discretion as this Court will hold, in accordance with the authorities cited, to be one upon which it will act. The Justices must not omit or decline to discharge a duty according to law. " We think that is what the authorities in the three cases before us have done. They have 747 refused to carry out the Act because they felt that it worked hardship. They have refused to give to the landlords the relief which the Act said they should have. Now, we feel no doubt that the Act provided that a tenant should be granted relief only in a case where he had not been in arrears with his rents for more than two years; in other words, if he had been in arrears for more than two years he was not to be given any relief against ejectment and the landlord would be entitled to an order for possession. First, we have to point out that the tenancy having been terminated in terms of the statute, the statute would necessarily create a right in the landlord to obtain possession of the demised premises. The tenancy having been terminated, the tenant is not entitled to remain in possession and the only person who would then be entitled to possession would be the landlord. The statute having provided for the termination of the tenancy would by necessary implication create a right in the landlord to recover possession. The statute recognises this right by providing by section 29(2) for its enforcement by an application to the Mamlatdar. Indeed, section 29(2) itself mentions this right expressly for it says that the application shall be made within two years from the date on which "the right to obtain possession of the land" accrued to the landlord. We repeat that this is a statutory right because it is the statute which fixes the term of the tenancy and also provides for its termination; it is not a contractual right which may be made subject to an equitable relief. We turn now to section 25. Under sub section (1) of this section the tenant has a right to an order continuing the tenancy inspite of its termination by notice under section 14 for non payment of rent. Sub section (2) however provides that sub section (1) shall not be available to a tenant if he has failed for any three years to pay rent. The result is that the statute itself 748 provides for relief to a tenant where such a termination has taken place and prescribes the conditions on which relief would be available. It would follow that the statute indicates that the tenant would not have the relief in any other circumstances. The result of this would inevitably be that the statute confers a right on the landlord to recover possession where the right under section 25(1) is not available to the tenant, which right he can enforce in the manner indicated. That being so, section 29 (3) cannot be read as conferring on the authorities a power to annul this intendment of the Act. The words "in lieu of making an order for ejectment" in sub section (1) of section 25 support the view that the Act intends that except in the circumstances mentioned in it, the landlord is entitled as of right to get an order for possession from the Mamlatdar. This view is further strengthened by the proviso to section 25 (1) which says that if the default in payment of rent had been caused by failure of crops or similar reasons, the Mamlatdar may give the tenant a year 's time to pay up and shall then provide in the order to be made by him that on the tenant 's failure to pay within that year, "the tenancy shall be deemed to be terminated and the tenant shall be liable to be evicted". In such a case the Mamlatdar could not by virtue of his supposed powers under section 29(3) give further relief if the tenant failed to pay as directed, for the Act makes it incumbent on him to pass the conditional order of ejectment. There, of course, is possession for the Act to have treated the cases under sub section (1) and the proviso to it, differently. This again is another reason for saying that the Act provides that apart from the circumstances mentioned in sub section (1) of section 25 and the proviso to it, the landlord has on a termination of the tenancy, a right to obtain an order for possession in his favour. It would be anomalous if the general words in s 29 (3) were to be construed as conferring power on the authorities to deprive him 749 of the right which the other provisions in the Act give him. We think, therefore, that section 29 (3) only confers power to make an order in terms of the statute, an order which would give effect to a right which the Act has elsewhere conferred. The words "as he deems fit" do not bestow a power to make any order on considerations dehors the statute which the authorities consider best according to their notions of justice. Obviously, the provision has been framed in general terms because it covers a variety of cases, namely, applications by landlords and tenants in different circumstances, each of which circumstances may call for a different order under the Act. One other argument under a similar head as dealt with previously, was that the tenants were entitled to relief against forfeiture under section 114 of the Transfer of Property Act. Section 3 of the Act provides that "the provisions of Chapter 5 of the shall in so far as they are not inconsistent with the provisions of this Act, apply to the tenancies and leases of land to which this Act applies". The present contention of the tenents is based on this section. It may be pointed out that ch. 5 of the includes sections 114 and 117. The last mentioned section provides that nothing in ch. 5 shall apply to leases for agriculture purposes except in so far as the State Government by notification declare them to be applicable. No such notification had been issued by the State Government. Therefore, the landlords contend, section 114 does not apply to the present leases which are for agricultural purposes and the tenants are not entitled to relief under it. It does not seem to us necessary to decide the question so raised. In our view, the provisions in section 114 of the are inconsistent with the provisions of the Bombay and cannot, 750 therefore, under section 3 of the latter Act govern the tenancies to which it applies. We have earlier stated that the Bombay Act clearly intended that relief against termination of tendency for non payment of rent would be given only in the cases mentioned in section 25(1) and in no others. Under section 114 of the relief may be given in other circumstances. Therefore, the provisions of this section are inconsistent with the provisions of the Bombay Act. For this reason we do not think that the tenants in the cases before us are entitled to claim any relief under section 114 of the . We think, therefore, that the tenants were not entitled to the relief which the authorities below granted them. Before we pass on to the other appeal raising a different question, we have to refer to the case of Raghuvir Vyasaraya Acharya vs Gobind Mogre Bandekar were it had been held by Chagla C.J., that section 29 (3) justifies an order granting relief to the tenant and refusing to make an order for possession in favour of the landlord even where the tenant has not paid rent for more than two years. We think that this case was wrongly decided. Chagla C.J., held that section 25 did not confer any substantive right on the landlord to obtain possession and that section 29(3) conferred on the Mamlatdar a discretion to pass any proper order that he thought fit. We think, for the reasons earlier stated, that on both these matters the learned Chief Justices was in error. We repeat that under the Act the landlord gets a right to obtain possession of the demised premises on the termination of the tenancy under section 14 and that section 25 as also section 29 clearly recognises that right. We turn now to the remaining appeal, namely Civil Appeal No. 259 of 1959. The question raised here is whether for the purposes of section 25(2) a tenant 751 is to be considered as having failed to pay rent for any year in respect of which he had been granted relief under section 25(1). The Revenue Tribunal, following a decision of the High Court at Bombay in Special Civil Application No. 2073 of 1955, unreported, held that where a landlord made an application for possession of the demised land on the failure of the tenant to pay rent for a year within the time prescribed in section 14, and the Mamlatdar granted relief to the tenant under section 25(1), the default was merged in the order of the Mamlatdar and could not thereafter be relied upon for the purposes of section 25(2). We did not have the original judgment of the High Court placed before us and are not aware of the reasons which persuaded it to the view that it took. In our opinion, that view is clearly incorrect, Section 25(2) says that nothing in section 25 which of course only means sub section (1) of that section shall apply to any tenant whose tenancy is terminated for non payment of rent if he has failed for any three years to pay rent within the period specified in section 14. We are unable to appreciate the contention that when a tenant has been granted relief under section 25(1) in respect of any year 's default, the default merged in the order granting relief and deceased to be a default. How can the default for the year merge in an order? No doubt relief has been given against the consequence of the default for the year, but that does not wipe out the default itself; it only prevents the termination of the tenancy, if any, consequent thereon, becoming effective. Inspite of the relief granted under section 25(1), the tenant remains a tenant who made default in paying rent for the year within the period specified in section 14 and that is the tenant mentioned in section 25(2). We find nothing in section 25(2) to justify the view that in such a case the year of default cannot be taken into account in computing the 752 three years there mentioned. It is of some significance to point out that section 25(2) does not require three successive years of default but it is satisfied where the tenant has been in default for any three years. If the interpretation put by the High Court were to be accepted, then a landlord wishing to recover possession of his land would have to wait till the tenant has committed default for three years, for if he took steps earlier and relief was granted to the tenant, he would not be able to recover possession after two more years of default by the tenant. We see no justification for thinking that the Act intended to put so much difficulty in the way of landlords. We, therefore, come to the conclusion that these appeals must succeed. We set aside the orders of the High Court in the cases in which that Court had been moved and of the Revenue Tribunal and other authorities under the Bombay Act refusing to make an order for possession in favour of the landlords. We direct that the respondent tenants make over possession of the lands held by them to their respective landlords. The appellants will be entitled to costs throughout. Appeals allowed.

In the first three appeals the tenants were in default in paying rents for three years and due notices had been served by the landlords terminating the tenancies. The landlords thus acquired statutory rights to eject the tenants and applied to the Mamlatdar, as required by section 29 of the Bombay Tenancy and Agricultural Lands Act, 1948, for possession over the lands. The Mamlatdar refused to make an order for possession on the ground that the tenants were entitled to relief against forfeiture on equitable principles. In the fourth appeal also the tenants had defaulted in paying rents for three years. In respect of the default in the first year the tenant had been granted relief against forfeiture under section 25(1) of the Act. The tenant contended that the default in the first year had merged in the order under section 25(1) and could not be relied upon far holding that he had defaulted for three years. ^ Held, that the landlords were entitled to orders for possession in all the four cases. Upon default in payment of rent for three years a statutory right accrued to the landlords under section 25(2) to terminate the tenancy and to obtain possession. There was no provision in the Act for granting relief against forfeiture in such a case; the provision in section 29(3) that the Mamlatdar "shall pass such orders as he deems fit" did not give him such a power. The Act merely empowered him to grant relief where the tenant was not in arrears for more than two years. No relief against forfeiture could be granted to the 740 tenants on equitable grounds; relief on equitable grounds could only be granted in cases of contractual rights and not in cases of statutory rights. Nor could relief be granted under section 114 Transfer of Property Act as that provision was inconsistent with the provisions of the Bombay Act and was therefore inapplicable. R. V. Boteler, (1864) 33 L. I. M. C. 101, referred to. Raghuvir, Vyasaraya Acharya vs Govind Mogre Bandekar, , disapproved. Held, further, that in the fourth appeal the default in the first year could also be taken into consideration in computing of three years inspite of the tenant having been relieved against forfeiture for that year. The order granting the relief did not wipe out the default, it only prevented the termination of the tenancy for that default alone.

Civil Appeal Nos. 524 to 539 of 1961. Appeals by special leave from the judgment and order dated July 5, 1961, of the Patna High Court, in Misc. Judicial cases Nos. 670 to 675 of 1959. WITH Civil Appeal No. 434 of 1961. Appeal by special leave from the judgment and order dated August 8, 1960, of the Patna High Court, in Misc. Judicial Case No. 334 of 1960. A.V. Viswanatha Sastri and B.P. Jha, for the appellants. (in C. As. 534 to 538 and 434 of 1961). B.P. Jha, for the appellant (in C.A. No. 539 of 1961). Lal Narain Sinha, L.S. Sinha and S.P. Verma, for the respondents. December 1. The Judgment of the Court was delivered by HIDAYATULLAH, J. The judgment in Civil Appeal No. 534 of 1961 will dispose of Civil Appeals Nos. 535 to 539 of 1961. In these appeals, private operators of omnibuses challenge the orders of the Appeal Board of the State Transport Authority, by which it set aside the renewal of the permits on certain routes granted by the South Bihar Regional Transport Authority, Patna. The appellants held 730 previously stage carriage permits over certain routes and which were due to expire in December, 1958 or in January, 1959. They had applied for renewal of their permits under section 58(2) of the Motor Vehicles Act. Under a scheme framed and notified on July 8, 1957, vide Notification No. P 2 203/57T/4794, the route, Gaya to Khijirsarai, was notified under section 68D of the Motor Vehicles Act. The Rajya Transport, Bihar, was exclusively allowed to operate on that route. In Civil Appeals No. 535 to 538 of 1961, the Rajya Transport, Bihar, filed objections against the renewal of the permits. In Civil appeals Nos. 534 and 539 of 1961, no objections were filed. The route, Gaya to Khijirsarai, which may be called conveniently route 'AB ' formed part of routes, on which the appellants were operating and in respect of which they had asked for renewal of their permits. The south Bihar Regional Transport Authority, however, renewed the permits of the appellants, holding that route 'AB ' was different from the routes, for which renewal was demanded. Against the orders of the Regional Transport Authority, appeals were filed by the Rajya Transport, Bihar in all the cases, that is to say, in those cases in which the Rajya Transport, Bihar, had objected, and those in which it had not objected. While these appeals were pending, the State of Bihar, acting under section 3 of the (64 of 1950) notified on April 20, 1959 as follows: "No. R.T. Cor. 1/59 3090 In exercise of the powers conferred by section 3 of the Road Transport corporation Act, 1950 (LXIV of 1950), the Governor of Bihar is pleased to establish with effect from the 1st May, 1959 a Road Transport Corporation, for the State of Bihar, to be called, the Bihar State Road Transport Corporation '. 731 2. The said Corporation shall with effect from the said date, exercise all the powers and perform all the functions which are at present being exercised and performed by the Rajya Transport, Bihar. By order of the Governor of Bihar. K. B. Sharma, Dy. " At the hearing of the appeals, the Government Advocate, Mr. Lal Narain Sinha, appeared for the Road Transport Corporation. Objection was taken to the competency of the appeals on two grounds. In those cases in which the Rajya Transport, Bihar, had not objected to the renewal of the permits before the Regional Transport Authority, it was contended that it had no locus standi to file appeals. In those cases in which it had so objected, the ground was that the Road Transport Corporation could not, in law, represent the Rajya Transport, Bihar, in the appeals filed by the latter. On merits, it was contented that the order of the Regional Transport Authority that route ' AB ' though part of the routes for which renewal was asked, was a different route, and the State Corporation had an exclusive right to ply omnibuses on routes 'AB ' did not affect the rights of the appellants to ply their omnibuses on routes, which were entirely different. The Government Advocate contended that, on the analogy of the principle underlying O. 22, Re. 10 of the Civil Procedure Code, the Road Transport Corporation on which devolved the powers and functions of the Rajya Transport, Bihar, could prosecute the appeals. He also contended, in the alternative, that he was representing also the Rajya Transport, Bihar, and that the appeals were not defective. The Board accepted the argument of the Government Advocate, and set aside the orders of renewal passed by the Regional Transport Authority. The appellants then filed petitions 732 under articles 226 and 227 of the Constitution challenging the order of the Board on many grounds. The High Court, by its judgment dated July 5, 1961, dismissed all the petitions. In the order under appeal, the High Court considered the competency of the appeals, and held that the Rajya Transport, Bihar, was competent to prosecute the appeals before the Appeal Board. In dealing with the question whether the Appeal Board was entitled to interfere with the order of the Regional Transport Authority at the instance of the Rajya Transport in those cases, where the Rajya Transport had not filed objections under the Motor Vehicles Act, the High Court held that it was not necessary to express an opinion on the correctness of the argument, because the Regional Transport Authority was not competent to grant a renewal, inasmuch as such a grant was a direct violation of the scheme approved by the State Government and published in the Official Gazette. On the merits, the High Court was of opinion that under section 68F(2) (c) (iii), the Regional Transport Authority could curtail the length of the route covered by the permit, and exclude the portion, which overlapped a notified route. The present appeals have been filed against the order of the High Court, with the special leave of this Court. These appeals thus fall into two groups. In one group are Civil Appeals Nos. 534 and 539 of 1961 and in the other are Civil Appeals Nos. 535 to 538 of 1961. In the former, the grant of renewal of the permits has been made without any objection, and in the latter, in spite of the objections filed by the Rajya Transport. The competency of the appeals before the Appeal Board is involved in both the groups, though on different grounds. The answer to the different objections is, however, the same. 733 In Abdul Gafoor vs State of Mysore, the effect of notifying a scheme was considered by this Court, and it was there stated that when a scheme has been notified under Chap. IVA of the Motor Vehicles Act, and an application is made for the grant of a permit on a route notified under the scheme by a private operator, the Regional Transport Authority has no option but to refuse the permit to the private operator, if the State Transport Undertaking has either applied for a permit or has already been granted one. In all the present cases, the State Transport Undertaking had already been granted a permit over route 'AB ', and if the private operators, that is to say, the appellants, were not entitled, in law, to the renewal of their permits for routes which embraced also route 'AB ', then the Regional Transport Authority could not but refuse to renew the permits. It was observed in Abdul Gafoor 's case that the duty of the Regional Transport Authority was merely mechanical, and that it was required to take note of routes which had been notified and to adapt its orders so as to be in conformity with the notified scheme. In view of the fact, therefore, that the scheme had been notified and route 'AB ' had already been granted to the Rajya Transport and/or the State Transport Undertaking, the Regional Transport Authority was incompetent to renew a permit over a route embracing route 'AB '. The Regional Transport Authority not having done its duty under the law, the Appeal Board was entitled, when the record was before it, to revise the order of the Regional Transport Authority, even if the appeal was incompetent, in view of the vast powers of revision under section 64A. That section, omitting the provisos, reads: "The State Transport Authority may, either on its own motion or on an application made to it, call for the record of any case in which an order has been made by a Regional 734 Transport Authority and in which no appeal lies, and if it appears to the State Transport Authority that the order made by the Regional Transport Authority is improper or illegal, the State Transport Authority may pass such order in relation to the case as it deems fit." The High Court came to the conclusion that it should not interfere, in its discretionary powers under articles 226 and 227, with the order of the Appeal Board, because even if the appeal for some reason was incompetent, the Appeal Board had the record before it, and gave effect to the correct legal position arising from a notified scheme. The same view was expressed also in Samarth Transport Co. vs Regional Transport Authority, Nagpur. In our opinion, we should not interfere on this ground either. In this connection, the difference between the two sets of cases arising from the fact whether the Rajya Transport, Bihar, had objected or not, completely disappears. We are now concerned with the merits of the contention that where the scheme notifies, as a route, a part of a larger route operated by a private operator, the two routes must be regarded as different, and the private operator cannot be prevented from running his omnibuses on that portion of his route which is a different route, although notified. Reliance is placed upon a decision of the Privy Council in Kelani Valley Motor Transit Co., Ltd., vs Colombo Ratnapura Omnibus Co., Ltd. There, the Privy Council was concerned with two Ordinances promulgated in Ceylon intituled the Motor Car Ordinance (No. 45 of 1938) and the Omnibus Service Licensing Ordinance (No. 47 of 1942). By the first schedule, para I of the latter Ordinance, it was provided that if applications were made by two or more persons for road service licences in respect of the same route, preference should be given to (a) an 735 application from a company or partnership comprising the holders of all the licences for the time being in force under the Motor Car Ordinance No. 45 of 1938, authorising the use of omnibuses on such route, and (b) an application from a company or partnership comprising the holders of the majority of the licences referred to in (a) above. Section 7, sub section 1, provides: "The issue of road service licences under this Ordinance shall be so regulated by the Commissioner as to secure that different persons are not authorised to provide regular omnibus services on the same section of any highway: Provided, however, that the Commissioner may, where he considers it necessary to do so having regard to the needs and convenience of the public, issue licences to two or more persons authorizing the provision of regular omnibus services involving the use of the same section of a highway, if, but only if (a) that section of the highway is common to the respective routes to be used for the purposes of the services to be provided under each of the licences, but does not constitute the whole or the major part of any such route." The real question in the case was whether the appellant there could take into account for the purpose of the first schedule, six omnibuses which had been licenced for the route, Panadura to Badulla via Colombo and the low level road. Panadura is 16 miles along the coast to Colombo and thence from Colombo to Ratnapura is 50 miles and from Ratnapura to Badulla, a further 80 miles. It was clear that the route from Panadura to Badulla was not the same or substantially the same route as the route, Colombo to Ratnapura; but if a licence for an omnibus on the route, Panadura to 736 Badulla, was one authorising the use of the omnibus on the route, Colombo to Ratnapura, then six omnibuses plied by the appellant could be taken into account to turn the scale between the parties. Sir John Beaumont in expounding the meaning of the word "route" observed as follows: "If 'route ' has the same meaning as 'highway ' in the Ordinance this argument must prevail, since admittedly an omnibus running on the highway from Panadura to Badulla will pass over the whole of the highway between Colombo and Ratnapura, but in their Lordships ' opinion it impossible to say that 'route ' and 'highway ' in the two Ordinances are synonymous terms. . A 'highway ' is the physical track along which an omnibus runs, whilst a 'route ' appears to their Lordships to be an abstract conception of a line of travel between one terminus and another, and to be something distinct from the highway traversed. " This distinction between "route" and "road" is relied upon by the appellants to show that the notified route, which we have called 'AB ' was a different route from the routes for which renewal of permits was demanded, even though route 'AB ' might have been a portion of the "road" traversed by the omnibuses of the appellants plying on their "routes. " The distinction made by the Privy Council is right; but it was made with reference to the words used in the Ordinances there under consideration. The question is whether a similar distinction can be made in the context of the Motor Vehicles Act. Mr. Viswanatha Sastri appearing for the appellants took us through sections 42 to 57 of the Motor Vehicles Act and drew our attention to those in which the word "route" has been used, contra distinguished from the word "area", and contended that everywhere the word "route" is used in the sense of a notional line between two 737 termini running a stated course, and is used in contradistinction to what may be conveyed by the word "area ". In Kondala Rao vs Andhra Pradesh State Road Transport Corporation, this court, in dealing with the scheme of the Motor Vehicles Act, declined to make any such distinction between "route" and "area". This Court, speaking through Subba Rao, J., observed at p. 93: "Under section 68C of the Act the scheme may be framed in respect of any area or a route or a portion of any area or a portion of a route. There is no inherent inconsistency between an 'area ' and a 'route '. The proposed route is also an area limited to the route proposed. The scheme may as well propose to operate a transport service in respect of a new route from point A to point B and that route would certainly be an area within the meaning of section 68C." In any event, under section 68C it is provided that a scheme may notify a route or an area or a portion of a route or a portion of an area, and the exclusion of the private operators from the whole route or the whole area or a part of the route or a part of that area, as the case may be, may be either complete or partial, and under section 68F(2) (c) (iii), the Regional Transport Authority may modify the terms of any existing permit so as to "curtail the area or route covered by the permit, in so far as such permit relates to the notified area or notified route ". This means that even in those cases where the notified route and the route applied for run over a common sector, the curtailment by virtue of the notified scheme would be by excluding that portion of the route or, in other words, the " road " common to both. The distinction between " route " as the notional line and " road " as the physical track disappears in the working of Chap. IVA, because you cannot curtail the route without curtailing a portion of the road, 738 and the ruling of the Court to which we have referred, would also show that even if the route was different, the area at least would be the same. The ruling of the Judicial Committee cannot be made applicable to the Motor Vehicles Act, particularly Chap. IVA, where the intention is to exclude private operators completely from running over certain sectors or routes vested in State Transport Undertakings. In our opinion, therefore, the appellants were rightly held to be disentitled to run over those portions of their routes which were notified as part of the scheme. Those portions cannot be said to be different routes, but must be regarded as portions of the routes of the private operators, from which the private operators stood excluded under section 68F (2)(c)(iii) of the Act. The decision under appeal was, therefore, correct in all the circumstances of the case. This leaves over for consideration Civil Appeal No. 434 of 1961. There, the question which arose was decided in the same way in which we have disposed of the other appeals on merits. Ramaswami, C.J., and Kanhaiya Singh, J., referred to an earlier decision (M.J.C. No. 354 of 1960 decided on May 13, 1960) given by the Chief Justice and Chaudhuri, J., in which they had applied the Privy Council case, and made a distinction between a route which was longer than the notified route, though running for part of the way along the notified route and the notified route. In the judgment from which Civil Appeal No. 434 of 1961 arises, the learned Chief Justice has declined to follow his earlier ruling which, he considers, was given perincuriam, because the provisions of section 68 F(2)(c)(iii) of the Motor Vehicles Act were not taken into account. After considering the matter in the light of that section, the Divisional Bench has reached the same conclusion as we have, and along almost the same line of reasoning. In view of what we have said in Civil Appeal No. 534 of 1961, Civil Appeal No. 434 of 1961 must also fail. 739 In the result, the appeals are dismissed, but in the circumstances of the case, we make no order about costs. Appeals dismissed.

Under a scheme framed and notified under the Motor Vehicles Act a certain route was notified under section 68D of the Act and the Rajya Transport, Bihar was exclusively allowed to operate on that route. The said notified route formed part of routes on which the appellants were operating, and in respect of which they had asked for renewal of their permits. The Rajya Transport, Bihar filed objections against the renewal of the permits in some cases but in other case no objection was filed. The question which arose for decision was whether the permits of the appellant could be renewed by the Regional Transport Authority. The appellants contended that as the notified route formed part of a larger route operated by a private operator, the two routes must be regarded as different route, and the private operator could not be prevented from running his omnibuses on that portion of his route, which was a different route, although notified. ^ Held, that as decided by this Court in Abdul Gafoor 's case, the Regional Transport Authority had no option but to refuse the permit to the private operator, if the State Transport Undertaking had either applied for a permit or had already been granted one. Abdul Gafoor vs State of Mysore, A.I.R. 1961 S.C. 1956, followed. If the Regional Transport Authority did not do its duty under the law the Appeal Board was entitled, when the record was before it, to revise the order of the Regional Transport Authority under its revisional powers as provided in section 64A of the Act, even if the appeal was incompetent. Samarth Transport Co. vs Regional Transport Authority Nagpur, ; , followed. 729 In the present case the appellants were not entitled to run over those portions of their routes which were notified as part of the scheme. Those portions could not be said to be different routes, but must be regarded as portions of the routes of the private operators, from which the private operators stood excluded under section 68F (2) (c) (iii) of the Act. Kelani Valley Motor Transit Co. vs Colombo Ratnapura Omnibus Co., and Kondala Rao vs Andhra Pradesh State Road Transport Corporation, A.I.R. 1961 S.C. 82, considered.

Civil Appeal No. 281 of 1959. Appeal by special leave from the judgment and order dated October 12, 1955, of the former Nagpur High Court in Misc. Petition No. 288 of 1954. H. R. Khanna and R. H. Dhebar, for the appellants. section N. Kherdekar and A. G. Ratnaparkhi, for respondent No. 1 1961. November 20. The Judgment of the Court was delivered by SHAH, J. Out of a total area of 2,375 acres 3 gunthas of Dhanora an Izara village in Taluka 712 Pusad in the State of Madhya Pradesh 2,283 acres and 28 gunthas is assessed land and the remaining 91 acres and 15 gunthas is unassessed. One Surat Singh who was the proprietor of the village, by sale deed dated May 24, 1947, conveyed an undivided half share in the village to Yeshwant Madhao Mahajan hereinafter called Mahajan for Rs. 25,000/ and on the same day executed a kabulayat (lease deed) for five years in respect of the same land for cultivation at an annual rental of Rs. 3,000/ . The Legislature of the Madhya Pradesh State enacted the Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act, 1 of 1951 hereinafter called the Act to provide for acquisition of the rights of proprietors in estates, mahals, alienated villages and alienated lands in Madhya Pradesh and to make provision for other matters connected therewith. The Act was brought into operation on March 14, 1951. The Compensation Officer, Yeotmal started an enquiry about assessment of compensation in respect of the village Dhanora which had vested by the operation of section 3 of the Act in the State Government. Before the Compensation officer, Mahajan claimed to retain possession of a half share in all the fallow lands in the village which had been leased by him under the deed (kabulayat) dated May, 24, 1947, to Surat Singh on the plea that these lands were "home farm". This claim was rejected by the Compensation Officer and the order of the Compensation Officer was confirmed in appeal by the Additional Settlement Commissioner. Mahajan then applied to the High Court of Judicature at Nagpur under article 226 of the Constitution for a direction quashing the order of the Additional Settlement Commissioner and the Compensation Officer and for a declaration that the lands mentioned in Schedule A attached to the petition be declared home farm and for a writ of mandamus against the State of Madhya Pradesh to deliver possession of all the lands mentioned in that Schedule. 713 The High Court quashed the order of the Additional Settlement Commissioner in so far as it related to the undivided half share in Survey Nos. 1 to 91 except those in possession of the specified tenants and also those already recognised as home farm and directed the Compensation Officer to decide the claim made by Mahajan in the light of the law laid down in the judgment. Against the order passed by the High Court, the Additional Settlement Commissioner and the State of Bombay, which had by virtue of the States Reorganization Act, 1956, been substituted for the State of Madhya Pradesh, have appealed to this Court with special leave. The dispute in this appeal relates to a half share in those lands in the village which had remained fallow on the date of the notification under section 3 of the Act. By virtue of the sale deed dated May 24, 1947, Mahajan was the proprietor of the undivided half share in the entire village and under the kabulayat he had granted to Surat Singh a lease for cultivation of the undivided half share purchased by him. Undoubtedly the lands specified in Schedule A to the petition were on the crucial date lying fallow. The question which falls to be determined is whether those lands can be regarded home far": if they be so regarded, by virtue of section 4(2) of the Act Mahajan will be entitled to retain possession of those lands. Section 3 of the Act provides, in so far as it is material, that "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 State for the purposes of the State free of all encumbrances." Section 4(1) sets out the 714 consequence of the vesting. By cl. (a) of section 4(1), all rights, title and interest vesting in the proprietor or any person having interest in such proprietary right through the proprietor in such area including land (cultivable or barren), cease and are vested in the State for the purposes of the State free from all encumbrances. But sub section 2 provides that "Notwithstanding anything contained in subsection (1), the proprietor shall continue to retain the possession of his home stead, home farm land. . . " . 'Home farm land ' is defined, in so far as it is material, in section 2(g) as: "(1) x x x x x x (2) x x x x x x (3) in relation to Berar, all land included in holdings which is (i) under the personal cultivation of the superior holder including land allowed to lie fallow in accordance with the usual agricultural practice; (ii) held by a lessee from the superior holder; and (iii) held by a tenant from the superior holder other than a specified tenant. " 'Land ' is defined as "including land covered with water. " Section 7 authorises the Deputy Commissioner to take charge of all lands, other than occupied lands and home stead lands, and of all interests vesting in the State under section 3 on the date of the vesting, and, by section 8, duty is imposed on the State Government to pay every proprietor, who is divested of proprietary rights, compensation in accordance with the rules contained in Schedule I. Mahajan was undoubtedly at the date of vesting the superior holder of the half share in the fallow lands which were held by Surat Singh as lessee from him. Prima facie the claim of Mahajan 715 was covered by cl. (g) (3) (ii) of section 2 of the Act, and Mahajan was entitled to the benefit of the exception in section 4 (2). But counsel for the State contends that in respect of an undivided interest in land, the superior holder is not entitled to the benefit of section 4(2), because it is not a "holding. " Alternatively, he contends that the land which is, at the date of vesting, lying fallow otherwise than in accordance with the usual agricultural practice can never be regarded as home farm. " In our view, there is no substance in either of these contentions. Schedule A to the petition sets out the description of the various lands which Mahajan claimed should be treated as "home farm" land. Each of these lands is assessed. The expression 'holding ' is not defined in the Act, but by cl. (d) of section 2 expressions not defined in the Act in relation to Berar but used or explained in the Berar Land Revenue Code, 1928, have the meaning assigned to those expressions in the latter Act. The Berar Land Revenue Code defines 'holding ' as "(a) a parcel of land separately assessed to land revenue; and(b) in reference to land held by a tenant a parcel of land held from a landlord under one lease or set of conditions. " Evidently, the survey numbers included in Schedule A to the petition were "holdings" within the meanings of the Berar Land Revenue Code and therefore within the meaning of that expression as used in the Act. It is true that Mahajan was not entitled to the entire area of each of these holdings but by the definition in the Act all lands included in holdings in Berar, provided they fulfil the conditions in cl. (i), (ii) or (iii) of sub cl. (3), are "home farm" lands. In other words a part of the holding or an undivided interest in the holding may also be "home farm" land if it otherwise fulfils the requirements of cl.(i) (ii) or (iii) of sub cl.(3). That a half share in the village which is included in the Schedule to the petition was granted 716 to Surat Singh on lease for cultivation cannot be gain said in view of the express covenants of the kabulayat. Certain lands in the village, it is true, were lying fallow wholly or partially at the date of the vesting, but the lands having been granted in lease for cultivation, in our judgment, they are by virtue of section 4(2) to be retained in the possession of the proprietor, provision of cl.(1) of section 4 notwithstanding. By sub section (2) of section 4 all "home farm" lands are to remain in possession of the proprietor: there is no express exclusion of lands lying fallow from the benefit of section 4 (2) and none such can be implied either from the scheme of the Act or the context in which section 4 (2) occurs. If Mahajan had remained in occupation as proprietor and had allowed the lands to remain fallow they may have vested in the State and Mahajan may not have been entitled to claim the benefit of section 4 (2) unless his case fell under cls. (i) and (iii) of section 2 (g)(3), but the grant of a lease for cultivation evidences an intention on the part of Mahajan that the land be converted to agricultural purposes and default on the part of the lessee to cultivate those lands will not, deprive the lessor proprietor of the benefit granted to him by the statute. In our view, the High Court was right in holding that the words of cl. (ii) of section 2(g) (3) were explicit and a survey number which was lying fallow but was held by a lessee from the superior holder fell within the definition of "home farm. " The appeal, therefore, fails and is dismissed with costs. Appeal dismissed.

In 1947 S conveyed by a sale deed to M an undivided half share of Land in his village. On the same day S executed a Kabulayat for 5 years in respect of the same land for cultivation. In 1951 the Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act, 1951, came into force and the Compensation Officer started enquiry about assessment of compensation. M claimed to retain possession of the half share in all the fallow lands in the village which had been leased by him for cultivation to S on the plea that these lands were 'home farm '. The claim 711 was rejected by the Compensation Officer and confirmed by the Additional Settlement Commissioner. The High Court of Nagpur quashed the order. In appeal to the Supreme the Additional Settlement Commissioner contended that in respect of an undivided interest in the land, the superior holder is not entitled to the benefit of section 4(2) of the Act because it is not a 'holding ', alternatively, that the land which was, at the date of vesting, lying fallow otherwise than in accordance with the usual agricultural practice could never be regarded as 'home farm '. ^ Held, that a part of a holding or an undivided interest in a " holding" in Berar may also be 'home farm ' land if it otherwise fulfils the requirement of cl. (i), (ii) or (iii) of sub cl. (3) of section 2(g) of the Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act, 1951. The land having been granted in lease for cultivation it is by virtue of section 4(2) of the Act to be retained in the possession of the proprietor. Grant of a lease for cultivation evidences an intention on the part of the proprietor that the land is to be converted to agricultural purposes, and default on the part of the lessee to cultivate the land will not deprive the lessor proprietor of the benefit granted to him by the statute.

Civil Appeals No. 180 of 1961. Appeal by special leave from the judgment and order dated January 30, 1961, of the Mysore High Court, in Writ Petition No. 1326 of 1960. section T. Desai, B. R. L. Iyengar and K. P. Bhat, for the Appellant. A. V. Viswanatha Sastri, R. Gopalakrishnan and T. M. Sen, for the respondents. December 1. The Judgment of the Court was delivered by HIDAYATULLAH, J. The appellants, C. P. C. Motor Service, Mysore, question a scheme approved and applied by the State of Mysore by its Notification No. HD. 200/TMP/60 in Gazette (Extraordinary) on November 10, 1960. They had unsuccessfully moved the High Court under article 226 of Constitution, and the present appeal is filed with the special leave of this Court. The appellants were running stage carriage omnibuses on 18 routes, and 14 such routes are inter District. On September 21, 1960, the second respondent, who is the General Manager of the State Transport Undertaking, published a tentative scheme for taking over stage carriage services over 64 routes, which were shown in a schedule to the Notification, to the complete exclusion of private operators. The action was taken under Chap. IV A of the , inserted by section 62 of Act 100 of 1956. Objections were duly filed by the appellants, which were heard by the Chief Minister, who was the authority to hear the objections under the Rules, and they were disposed of by his order dated 719 November 7, 1960. The scheme was approved with some modifications, and it was published along with the order in the Notification, to which we have already referred. The appellants, in their petition under article 226 of the Constitution, raised many points before the High Court. The High Court, by its judgment under appeal dated January 30, 1961, dismissed the petition. Some of the grounds were considered in that judgment; but others had already been disposed of in other petitions, in which a common judgment was delivered by the High Court also on the same day in Writ Petition No. 75 of 1960. That order concerned another scheme for the Hassan District of Mysore State. In the appeal before us, the scheme is challenged on four grounds. Shortly stated, they are, that the modified scheme is vague, indefinite and contradictory and does not carry out the orders of the Chief Minister; that there has been non compliance with the mandatory requirements of sections 68C and 68E of the ; that the scheme is destructive of co ordination, which is the gist of efficient motor transport services; and finally, that the routes on which the appellants operated, were, in any event, not affected by the monopoly on certain routes created in favour of the State Transport Undertaking. These contentions will be dealt with in detail by us in this judgment, and need not be stated at greater length at this stage. Private operators in the Mysore State including the appellants, plied their omnibuses on three different kinds of routes. They were inter District, inter District and inter State. By the scheme, the State Transport Undertaking had taken over 64 routes, but the exclusion of the private operators was only in the Mysore District. In the approved scheme, this is stated in the following words: 720 "(d) Whether the services are 1. The State Transport to be operated by the Undertaking will ope State Transport Under rate services to the taking to the exclusion, complete exclusion complete or partial, of of other persons(i) other persons or other on all the notified wise. inter district routes except in regard to the portions of inter district routes lying outside the limits of Mysore District, and also (ii) over the en tire length of each of the inter district route lying within the limits of Mysore District. In so far as the noti fied routes are con cerned the State Transport Undertak ing will operate with out prejudice to rights of the existing valid permit holders for operation of Stage Carriage Services on the Inter State routes only". In describing the routes in the appendix to the scheme, these routes were shown with all the stops between the termini, together with the length of the routes in miles, the maximum number of vehicles to be operated by the State Transport Undertaking and by private operators, and the maximum number of daily services (return trips) to be provided in relation to each route by the State Transport Undertaking and by the private operators. The columns dealing with private operators in respect of the maximum number of vehicles as well as the maximum number of the daily services were invariably shown as "Nil". Section 68C of the permits the taking over 721 of any route or area either wholly or partly by the State Undertaking, and the action of the State Government has not been challenged as either ultra vires or invalid. This is due perhaps to the fact that in a number of cases recently decided by this Court, schemes of this type have been held to be valid, and the provisions of Chap. IV A, in view of the amendments effected by the Constitution (First Amendment) Act, 1951, in article 19(6), have been held intra vires the State Legislatures. Those cases are also referred to by the High Court in the judgment dealing with the Hassan District scheme. The first question that has been raised is that the scheme is vague, indefinite and contradictory. The vagueness, it is said, arises from the fact that though under section 68C certain particulars have to be mentioned, they have not been so mentioned in the scheme. This point is illustrated by referring to the columns in which the routes of private operators have not been shown; but it is stated by the respondents that on the routes mentioned in the scheme, the private operators have no omnibuses, nor any daily services at all. This, in our opinion, is the direct result of taking over of certain routes, because if those routes are taken away, then the private operators would not be running their omnibuses on those routes, and the appropriate entry would be as shown there, "Nil". The rest of the particulars have been given in the scheme itself, including the kind of vehicles which would be run, and their seating capacity, equipment, etc. No doubt, the fares and the timings have been left out, and the State Transport Authority has been given the power to fix them. But that is a matter for the determination of the transport authorities under the . It is too much to expect fares and timings to be indicated in the scheme, because each route requires elaborate enquiry for fixing the fares as well as the timings of service. The scheme is 722 not required, under the law, to deal with these matters, and we are satisfied that the omission of these details from the scheme does not militate against it. Similarly, the argument that the scheme is destructive of co ordination is not valid. No doubt, the private operators cannot run in the Mysore District, but can ply their omnibuses from the border of the Mysore District on routes, which were saved to them, and there is likelihood of transhipment from State owned buses to private omnibuses at the border, where the routes operated by the State Transport Undertaking and the private operators bifurcate. The transhipment, by itself, would not connote a lack of co ordination. Under section 68C, the State Transport Undertaking may take over whole routes or whole areas or part of the routes or part of the areas and if the scheme operates partially, some transhipment would obviously be necessary, but co ordination would still exist, because where the State omnibuses come to a halt, the private omnibuses would take the passengers set down. In our opinion, these grounds have no validity, in view of the partial nationalisation of the routes involved in the State. Really, the main attack against the scheme is that though the Chief Minister had upheld the objection of the appellants in an earlier portion of his order, the direction which he contemplated giving was not effectuated, leading to a contradiction between the order and the approved scheme. The Chief Minister, in dealing with the objection of the private operators, had observed in his order as follows: "The Private Operators contended that exclusive operation by the Mysore Government Road Transport Department on the proposed notified routes might seriously affect them on certain Inter District routes as well as Inter State routes. The State Transport Undertaking 723 it was argued, had not proposed nationalisation of certain Inter District and Inter State routes lying outside the limits of Mysore District, though a few of the notified routes traverse portions of Inter State and Inter District routes. It was contended by the Objectors that if the Mysore Government Road Transport Department was to operate certain notified routes to the complete exclusion of other operators, it would adversely affect the passenger transport system on certain portions of Inter State and Inter District routes which are notified. There is much force in this contention and accordingly, the Scheme is directed to be suitably modified. " It was argued that the point which was made before the Chief Minister was that between the routes which were taken over and some of the inter District and inter State routes which were left to the private operators, there was an overlap in the Mysore District, and that those routes which were not taken over including the portion of the route lying within the Mysore District should not be held to be affected by the scheme. It was argued that the Chief Minister in his order quoted above, accepted the contention, and gave directions for the suitable modification of the scheme, but in carrying out the modifications, the directions, quoted above, were not included, and they excluded the private operators from that portion of the route lying within the District of Mysore, even though that route was different from the route, which had been taken over. In our opinion, the error lies in not properly reading the order of the Chief Minister. In the sentence, "It was contended by the Objectors that if the Mysore Government Road Transport Department was to operate certain notified routes to the complete exclusion of other operators, it would adversely 724 affect the passenger transport system on certain portions of inter State and inter District routes which are not notified," the words "which are not notified" qualify not the word "route" but the word "portions". The direction which was given, effectuates the later reading, which was really meant and not the former, which is urged; because the qualifying phrase "which are not notified" has been unhappily put later. It is no doubt true that the other reading is also open, and is more in accord with a grammatical construction. Where two constructions are open, it is proper to read the order harmoniously with the directions, because it could not have been intended that the Chief Minister would express his opinion in one way, and include a contradictory direction in another way. Indeed, the intention was to take over routes or parts of the routes lying in Mysore District and to notify them as within the exclusive operation of the State Transport Undertaking. The exclusive operation of routes within the District meant that no other omnibus belonging to a private operator could run on that sector. The direction, therefore, clearly said that the route left to the private operators would be open to them beyond the borders of the District, but there were excluded from that portion of the route which lay within the District. In Nilkanth Prasad vs State of Bihar, in which we have delivered judgment today, we have explained what is meant by a "route" and 'a portion of a route ', and we need not cover the same ground. In our opinion, there is no contradiction between the order of the Chief Minister and the directions included by him in the concluding part of his order. Indeed, the directions carry out the order, if the order is to be read in the manner indicated by us. It was next contended that the inter District routes, which the appellants were operating, could not be said to be affected by the scheme at 725 all, because "route" means a notional line running between two termini and following a distinct course. This meaning was given to the word "route" by the Privy Council in a case from Ceylon reported in Kelani Valley Motor Transit Co., Ltd. vs Colombo Ratnapura Omnibus Co., Ltd. It is said that the ruling applies in the present case where what is notified as for exclusive running by the State Transport Undertaking is not a definite portion of a route of a private operator but is a different route altogether. This may be illustrated by algebraic notations. If the route of the private operator was ABPQR, AB lying within the District of Mysore and PQR outside it, it is submitted that a route ABCDE may overlap the other route up to the point B but is not the same route, and, therefore, cannot be said to be notified. What is meant by a route in the Act has been elaborately discussed by us in the other judgment delivered to day. The only difference between this case and the other cases is that, whereas in the latter, the notified route was only AB, here the notified route is ABCDE. The notification of the Government must be read in two parts. The first is that part of the notification referring to the whole of the route which is taken over, and the second part is with respect to the portion of the route lying within the District of Mysore. The portion lying within the District of Mysore has been notified separately as within the exclusive operation of the State Transport Undertaking. The natural result of it is that private operators would not be able to ply their omnibuses on that sector, and by "route" is meant, as already stated, not only the notional line but also the actual road over which the omnibuses run. We have shown in the other appeals that the scheme of the Ceylon ordinance was different. There, the 726 word "route" was contracted with the word "highway". In the , the words used are "route or area", and it has been held by this Court that these words mean the same thing: Kondala Rao vs Andhra Pradesh State Road Transport Corporation. The scheme of the Act in section 68F(2)(c)(iii) also shows that the Regional Transport Authority, in giving effect to the approved scheme, may "curtail the area or route covered by the permit in so far as such permit relates to the notified area or notified route". This makes the route or area stand for the road on which the omnibuses run or portions thereof, and in view of the fact that the scheme reserved all the routes within the Mysore District to the State Transport Undertaking even those routes which were inter District open to the private operators would stand pro tanto out down to only that portion, which lies outside the Mysore District. The result, therefore, is that no distinction can be made between the notification of a portion of the route of the private operators lying within the Mysore District and the notification of a different route, in which the portion within the Mysore District is also included. What we have said in the other case applied equally here. It was suggested during the argument that there were certain routes which did not cover any portion of the notified route but met that route at certain point or points. Reverting to the algebraic notations given above, it was said that route APBQR would not cover any portion of the notified route ABCDE, and must at least, therefore, be outside the scheme. No such route, however, was pointed out to us, and we need not express any opinion on this part of the case or as to what would happen, if such a route existed. 727 Lastly, it was contended that the minimum number of trips and the minimum number of vehicles to be put on the road with respect to any route has not been indicated, and that this is not a proper scheme, because a scheme must show how comparatively more efficient service is to be provided by the State Transport Undertaking. The earlier Rules required a statement as to the minimum and maximum number of vehicles to be put on a route, as also the minimum and maximum trips. It was, however, held by this court that a departure from the minimum number would mean the alteration of the scheme, necessitating the observance of all the formalities for framing a scheme. In view of this, the Rules were amended, obviating the necessity of indicating the minimum number. The Rule, as it now stands, has been complied with, and there being no challenge to the Rule as such, one cannot say that the scheme is defective on this account. The result is that this appeal must fail, and is dismissed; but in the circumstances of the case, we make no order about costs. Appeal dismissed.

Under a scheme for taking over certain stage carriage services to the complete exclusion of private operators, which was approved and notified by the State of Mysore under the provisions of Ch. IV A of the , it was provided, inter alia: "The State Transport Undertaking will operate services to the complete exclusion of other persons (i) on all the notified inter district routes except in regard to the portions of inter district routes Lying outside the limits of Mysore District, and also (ii) over the entire length of each of the inter district routes Lying within the limits of Mysore District. " The appellants who were running stage carriage omnibuses of certain routes, some of which were inter district and inter State, challenged the validity of the scheme on the ground, inter alia, that between the routes which were taken over and some of the inter district and inter State routes which were left to the private operators, there was an overlap in the Mysore District, and that those routes which were not taken over including the portion of the route Lying within the Mysore District should not be affected by the scheme, because "route" meant a notional line running between two termini and following a distinct course. ^ Held, that the scheme of the , is that the word "route" meant not only the notional line but also the actual road over which the omnibuses run. Under the Act the route or area stand for the road on which the omnibuses run or portions thereof. Kondala Rao vs Andhra Pradesh State Road Transport Corporation, A. I. R. , relied on. Kelani Valley Motor Transit Co., Ltd. vs Colombo Ratnapura Omnibus Co., Ltd. [1946] A. C. 338, explained and distinguished. In the present case, in view of the fact that the scheme reserved all the routes within the Mysore District to the State Transport Undertaking, the private operators would not be able to ply their omnibuses on that sector and even those 718 routes which were inter district open to them would stand pro tanto cut down to only that portion which lay outside the Mysore District. Nilkanth Prasad vs The State of Bihar, [1962] Supp. 1 section C. R. 717, followed.

s Nos. 117 and 137 of 1961. Petition under Art 32 of the Constitution of India for enforcement of Fundamental Rights. L. K. Jha and R. Patnaik, for the petitioner (in Petn. No 117 of 1961). C. B. Agarwala and R. Patnaik, for the petitioner (in Petn. No. 137 of 1961). A. V. Viswanatha Sastri, B. R. L. Iyengar and T. M. Sen, for the respondents. 683 1961. November 28. The Judgment of the Court was delivered by WANCHOO, J. These two petitions challenge the validity of a scheme of road transport service approved by the Government of Orissa under section 68D (2) of the , No. IV of 1939 (hereinafter called the Act). A large number of grounds have been raised in the petitions but we are now concerned with only six points urged on behalf of the petitioners and we shall deal with only those points. No arguments were addressed on the other points raised in the petitions and it is therefore not necessary to set them out. The six points which have been raised before us are these: 1. No hearing was given to the petitioner in petition No. 117 as required by section 68D (2) and the Rules framed under Chap. IV A. 2. The minister who heard the objections under section 68D (2) was biased and therefore the approval given to the scheme is invalid. The order of the Regional Transport Authority dated December 17, 1960, rendering the permits of the petitioners ineffective from April 1, 1961 is illegal inasmuch as section 68 F and r. 10 framed under Chap. IV A were violated. The State Transport Undertaking did not apply for permits six weeks before April 1, 1961, as required by section 57 (2) of the Act and therefore the issue of permits to the State Transport Undertaking was bad. The final scheme did not mention the date from which it was to come into operation as required by r. 3 (vi) of the Orissa Rules and was therefore bad. The Transport Controller who published the scheme had no authority to do so. 684 We propose to take these points one by one. Re. 1. The contention of the petitioner is that the minister heard the objections on September 21, 1960, and passed his orders approving the scheme on September 22, 1960. The notice however issued to the petitioner of the date of hearing was received by him on September 23, 1960, and as such as there was no opportunity for the petitioner to get a hearing before the minister and consequently the scheme which was approved in violation of section 68D (2) and r. 8 was invalid. It appears that the draft scheme was published on July 29, 1960. Objections were invited from the operators and members of the public thereto. The petitioner filed his objection on August 24, 1960. The date which was originally fixed for hearing of objections was September 16, 1960, and it is not disputed that the notice of that date was given to all objectors as required by section 68D(2) and the Rules. The petitioner, however, did not appear on September 16, 1960, which was the first date of hearing. Many other objectors appeared on that date and prayed for time. Consequently the hearing was adjourned to September 21. As however the petitioner was absent a fresh notice was sent to him as a matter of abundant caution. That notice could not be delivered to him before September 21, 1960, as he was absent from his address and he was actually served on September 23, 1960 The petitioner 's complaint therefore is that as he was not served with notice about the hearing on September 21, 1960 there was no compliance with section 68D (2) and the Rules framed in that connection under Chap. On these facts, we are of opinion that there is no force in the contention raised on behalf of the petitioner. What r. 8 of the Orissa Rules requires is that ten days ' clear notice has to be given of the time, place and date of hearing to all 685 objectors. This was undoubtedly done, for the date originally fixed for hearing was September 16, 1960. Thereafter the hearing was postponed to September 21 at the instance of the objectors. It was in our opinion not necessary to give a fresh notice giving ten clear days as required by r. 8, for this adjourned date. Rule 8 only applies to the first date to be fixed for hearing. Thereafter if the hearing is adjourned, it is in our opinion unnecessary to give a further notice at all for the adjourned date. It was the duty of the petitioner after he had received notice of the first date to appear on that date. If he did not appear and the hearing had to be adjourned on the request of the objectors, or for any other reason, to another date, no further notice was necessary of the adjourned date. It is true that notice was given to the petitioner of the adjourned date; but that was in our opinion as a measure of abundant caution. The rule does not however require that a fresh notice must be given of the adjourned date of hearing also. In the circumstances we reject this contention. Re. 2. Reliance is placed on two circumstances to show that the Minister was biased and therefore the hearing given by him was no hearing in law. In the first place, it is said that in answer to a question in the Orissa Legislative Assembly as to when the Government was taking over the privately operated motor routes, the Transport Minister (who eventually heard the objections) replied that the Government had decided to take over all the routes from April 1, 1961, eliminating all private operators. It is urged that this shows that the Transport Minister was biased and was determined whatever happened to push through the scheme so that it may become operative from April 1, 1961. We are of opinion that there is no force in this contention 686 of bias based on this reply of the Minister to a question put in the Legislative Assembly. The Government was asked when it was intending to take over the privately operated motor routes and its reply was really a matter of policy, namely that it was the policy of the Government to take over all the routes eliminating all private operators from April 1, 1961. This did not mean that even if, for example, the scheme was not ready or if the scheme put forth was found by the Government to be open to objection, the Government would still force through the taking over of the privately operated routes from April 1, 1961 ; This answer was merely an indication of the Government 's policy, namely, that the Government was intending to take over all private operated routes from April 1, 1961 ; but whether in actual fact all the routes would be taken over on that date would depend upon so many circumstances including finance. It cannot be said that this announcement of the Government 's policy in answer to a question put in the legislative assembly meant that the Government was determined whatever happened to eliminate all privately operated routes by April 1, 1961. We are therefore of opinion that the Minister cannot be said to be personally biased because this policy statement was made by him in answer to a question put in the legislative assembly. Another reason that is urged to support the personal bias of the Minister is that the Minister is said to have stated to certain persons that as the privately operated routes in the district of Ganjam which was his constituency had been nationalised he was determined to annihilate all the private bus operators in the district of Cuttack also. This allegation has been denied on behalf of the State. It is however urged that no affidavit has been filed by the Minister who alone was likely to have knowledge on this point. It appears however that the petitioners also have no personal knowledge of 687 any such determination on the part of the Minister. Thy based their allegation on an alleged talk between the Minister and two citizens of Cuttack, namely, a municipal councillor and an advocate. No affidavit however of the two persons concerned has been filed to support this allegation. In the circumstances we are of opinion that it was not necessary for the Minister to file an affidavit for the allegation on behalf of the petitioners was also based on heresay and it has been contradicted by similar evidence on behalf of the State. It would have been a different matter if the two persons concerned had made affidavits from personal knowledge. There is therefore no force in this contention and we are of opinion that it cannot be said on the facts of this case that the Minister was biased. Re. 3 and 4. We propose to take these points together. We are of opinion that the petitioners cannot be allowed to raise these points for the first time in arguments before us, for there is no mention of these points in their petitions. It appears that in an affidavit filed ill connection with stay, something was said on these two points; but the stay matter was never pursued and never came up before this Court for hearing. In the circumstances there was no reply from the State Government to these allegations. We are of opinion that the petitioners cannot be allowed to raise these points now for the first time in arguments when they did not raise them in their petitions and consequently reject them. Re. 5. It is contended that under r. 3 (vi) of the Orissa Rules, the draft scheme or the approved scheme has to be published in the official gazette under sections 68D and 68E and has to contain certain particulars including the actual date of operating 688 the route. Now what happened in this case is that the draft scheme mentioned the date of operation as April 1, 1961. This was in accordance with r. 3 (vi). When the final scheme was published, this date was not mentioned in it. We will assume that r. 3 (vi) requires that when the final scheme was published, the date should have been mentioned. It seems to us that the rule so read has been substantially complied with, for the notification publishing the final scheme refers to the draft scheme and says that the draft scheme is approved and there is no mention of any modification. In the circumstances it could in our opinion be not unreasonable to read the date April 1, 1961, incorporated in the final scheme by reference to the draft scheme. It would have been a different matter if the draft scheme also did not contain the date of operation. We are therefore of opinion that there has been substantial compliance with r. 3 (vi), and the final scheme cannot be said to be bad for non compliance with the rule. We therefore reject this contention. Re. 6. It is urged in this connection that the Transport Controller had no authority to publish the draft scheme. It is also urged that the Transport Controller is not the State Transport Undertaking and the notification under section 68C does not show that the State Transport Undertaking was of opinion that it was necessary to take over certain transport services for the purpose mentioned in that section. The argument as raised before us is really two fold. In the first place it is urged that the Transport Controller had no authority to publish the scheme. There is however no force in this contention, for section 68C requires that after the State Transport Undertaking has formed the opinion required thereunder and prepared a scheme it shall cause the scheme to be published. The Transport Controller 689 is the chief officer of the State Transport Undertaking and we see nothing irregular if he publishes the scheme prepared under section 68C. The section lays down that after the scheme has been prepared in the manner provided thereunder, the State Transport Undertaking shall cause it to be published, which means that some officer of the Undertaking will have it published in the gazette. In the present case, the chief officer of the Undertaking has got it published and this in our opinion is in sufficient compliance with section 68C. The other part of the argument is that the notification under section 68C does not show that it was the State Transport Undertaking which was satisfied that it was necessary to take action under that section, for it says that "I, Colonel section K. Ray, Indian Army (Retd.), Transport Controller, Orissa, in charge of State Transport Undertaking, Orissa, am of opinion that for the purpose of providing an efficient, adequate and economical and properly coordinated road transport service it is necessary . . . ." The argument is that it was not the State Transport Undertaking which was satisfied but Col. section K. Ray, Transport Controller, who formed the necessary opinion under section 68C. We find that this point was also not taken in the petitions. All that was said in the petitions was that the Transport Controller was only in charge of the transport services in the State and there was no State Transport Undertaking in the State of Orissa within the meaning cl. (b) of section 68A of the Act. This case has been abandoned; but it is now contended is that even though there may be a State Transport Undertaking in Orissa that Undertaking was not satisfied that it was necessary to take action in the manner provided in section 68C. This in our opinion is a question of fact and should have been specifically pleaded in the petitions so that the State may have been able to make a reply. In the absence therefore of any averment on this question 690 of fact, we are not prepared to allow the petitioners to raise this point in arguments before us. In the circumstances we reject this contention also. The petitions therefore fail and are hereby dismissed with costs one set of hearing costs. Petitions dismissed.

The validity of a scheme of road transport service approved by the Government of Orissa under section 68D (2) of the 682 , was challenged by the petitioners on the grounds (1) that a proper notice was not given for the hearing of objections to the scheme, (2) that the Minister for Transport who approved of the scheme was biased, (3) that the final scheme did not mention the date on which it was to come into operation, and (4) that the Transport Controller who published the scheme had no authority to do so. ^ Held, that; (1) r. 8 of the Rules framed by the Orissa State Government under Ch. IVA of the , applied only to the first date to be fixed for hearing, and that if for any reason the hearing was adjourned, it was not necessary to give a fresh notice under the rule for the adjourned date of hearing; (2) the statement made by the minister in answer to a question put in the legislative assembly that the Government had decided to take over all the routes from April 1, 1961, eliminating all private operators, was merely an indication of the Government 's policy and that the minister could not be said to be personally biased; (3) the approved scheme was not invalid for the reason that the actual date of operating the route was not mentioned in the final scheme, as required under r. 3 (vi) of the Rules, inasmuch as the notification publishing the final scheme referred to the draft scheme which contained that date and said that the draft scheme was approved, and, consequently, the rule must be considered to have been substantially complied with; and (4) the Transport Controller, being the Chief Officer of the State Transport Undertaking, had the authority to publish the scheme under section 68C of the Act since the section provided that the State Transport Undertaking "shall cause it to be published" which meant that some officer of the Undertaking would have it published in the Gazette.

Civil Appeal No. 490 of 1860. Appeal by special leave from the judgment and order dated October 6, 1958, of the Punjab High Court in Civil Misc. No. 28 of 1958(File 'A '). Mohan Behari Lal, for the appellant. N. section Bindra and P. D. Menon, for the respondent No. 1. Radhey Lal Agarwal and V.N. Sethi, for respondent No.2. December 5. The Judgment of the Court was delivered by DAS GUPTA, J. The appellant, Jetha Nand (Betab) was enrolled as an Advocate in the Chief Court of Sind on May 14, 1947. He came away to India at the end of the year 1948 and practised in the courts at Delhi. On October 8, 1956 an order was passed by the Chief Justice of the Punjab High Court prohibiting the appellant from practising as an 963 Advocate in the courts at Delhi. On November 8, 1956 the appellant presented an application to the High Court in which he contended that by virtue of his having been enrolled as an Advocate in the Chief Court of Sind he was entitled to practice in all the subordinate courts within the territory of India. This petition was however rejected by a Full Bench of the Punjab High Court on the view that the appellant could not after the partition of India be considered to be an Advocate enrolled under the provisions of the Bar Councils Act. Against this order the present appeal has been preferred on special leave granted by this Court. The petitioner 's case is that as immediately before the partition of India he was entitled to practise in any court in British India his right to practise in those Courts continued to exist even when on partition of India, "British India" ceased to exist and provinces of India took their place; and when thereafter on the formation of the Indian Union under the Constitution these provinces became States of India but those same courts continued, his right to practise in those courts also continued. On behalf of the respondents it is contended that the petitioner 's right to practise in courts which were not under the Chief Court of Sind ceased as soon as Sind ceased to form part of India and the Chief Court of Sind ceased to be a High Court in India. As the appellant bases his claim on section 14 (1) (b) of the , it is necessary to examine first the scheme of that Act. This Act was passed to provide for the constitution and incorporation of Bar Councils for certain courts in British India, to confer powers and impose duties on such Bar Councils and to amend the law relating to legal practitioners entitled to practise in the courts. It extended to the whole of British 964 India but was in the first instance made applicable to only certain named High Courts the High Court at Calcutta, and the High Courts at Madras, Bombay, Allahabad, Patna and Rangoon. It was also provided (section 1, sub s.2) that the Act shall apply to such other High Court within the meaning of cl. 24 of section 3 of the as the Governor General in Council may, by notification in the Gazette declare to be High Courts to which this Act applies. Sections 2,17, 18 and 19 were to come into force at once; but as regards the other provisions it was enacted that they could come into force in respect of any High Court to which the Act applied on such date as the Governor General in Council might by notification direct. Section 2 defined Advocate as "an advocate" entered in the roll of advocates of a High Court under the provisions of this Act and "High Court" as "a High Court to which this Act applies". Sections 3, 4 and 5 deal with the constitution and incorporation of Bar Councils. Section 8 makes it the duty of every High Court to prepare and maintain a roll of advocates of the High Court and also provides that no person shall be entitled as of right to practise in any High Court unless his name is entered in the roll of the advocates of the High Court. Section 10 empowers the High Court to reprimand, suspend or remove from practice any advocate of the High Court whom it finds guilty of professional and other misconduct. The manner in which such action can be taken is dealt with in sections 10, 11, 12 and 13. Of these, section 12 provides inter alia that when any advocate is reprimanded or suspended under this Act a record of the punishment shall be entered against his name in the roll of the Advocates of the High Court and when an Advocate is removed from Practice his name shall forthwith be struck of the roll. Section 14 provides inter alia that an advocate shall be entitled as of right to practise in any other Court in British India. 965 It is not disputed before us that the Governor General by notification in the Gazette of India did declare the Chief Court of Sind to be a High Court to which this Act applied and that by another notification he also directed that all the provisions of the Act would come into force in respect of the Chief Court of Sind on some date long before 1947. Consequently, even though these notifications have not been placed before us we must proceed on the bases that on May 14, 1947, when the appellant was enrolled as an advocate in the Chief Court of Sind he was an advocate for the purposes of the and so was entitled as of right to practise in any subordinate courts in what then was British India. The question is whether this right continued to exist after Sind ceased to form a part of India. It appears to us clear that when section 2 defines advocate as "an advocate entered in the roll of advocates of High Court", it means an advocate who has been entered in such roll of advocates and whose name continues to be on that roll. When, for example, the name of the advocate is removed from the roll under section 12 (7) he ceases to be an advocate within the meaning of section 14 in spite of the fact that his name was once entered in that roll. An advocate entered in the roll of advocates can therefore mean only one whose name continues to be entered in that roll. What is the position if the High Court ceases to exist, by reason of abolition or otherwise ? The only possible answer to this question is that if the High Court ceases to exist; the roll which used to be maintained by it has also no legal existence and consequently a person whose name was in that roll, is no longer an advocate within the meaning of section 14 or any other section of the Act. That appears to be exactly the position in the present case. The Chief Court of Sind was a High Court within the meaning of sections 3 to 19 of the by reason of the notification made by the Governor General in Council under section 1 sub section 2 of the Act. It would be absurd 966 to think that when Sind ceased to form part of India the Chief Court of Sind still continued to be a High Court for the purposes of Indian law. All doubts in the matter have however been set at rest by the provisions of the Indian (Adaptation of Existing Indian Laws) Order, 1947. In this connection it is necessary to recall section 18 sub section 18 sub section 3 of the Indian Independence Act which provides that the law of British India and of the several parts thereof existing immediately before the appointed day shall, so far as applicable and with the necessary adaptations, continue as the law of each of the new Dominions and the several parts thereof until other provision is made by laws of the Legislature of the Dominion in question or by any other legislature or other authority having power in that behalf. Many adaptations were in fact found necessary to remove complications and confusions which might otherwise have arisen. Of the several adaptation orders made we are concerned here with the Adaptation Order No.16 which was called the India (Adaptation of Existing Indian laws) Order, 1947. In this Order, the appointed dated was defined as August 15, 1947. Section 5 of the Order is in these words : "Any reference in an existing Indian law to a High Court which as from the appointed day ceases to be a High Court for any part of the Dominion of India, shall (a) if the reference be to the High Court of Judicature at Lahore, be replaced by a reference to the High Court of East Punjab, and (b) in any other case, be omitted. " The Chief Court of Sind (a High Court within the meaning of the ) having ceased as from August 15, 1947 to be a High Court for any part of the Dominion of India references to that Court as one to which the Act applied must be omitted in the application of the Indian Bar 967 Councils Act, 1926 after that date. In other words, the Chief Court of Sind which was a High Court for the purposes of the up to the August 14, 1947 ceased to exist as a High Court for the purposes of the with effect from the 15th day of August, 1947. The necessary consequence of this is that the roll maintained by the Chief Court of Sind was from August 15, 1947 no longer a roll maintained by a High Court within the meaning of the and thus any person whose name was entered on the roll of the Chief Court of Sind ceased to be an advocate for the purpose of section 14 of the and therefore ceased to have the right under that section to practise in courts in India. There can be no doubt whatsoever that in making this adaptation in section 5 of the India (Adaptation of Existing Indian Laws) Order, 1947 the intention of the authority making the order was not only to ensure that rights will not in future accrue on the basis of a High Court now in Pakistan having been formerly a High Court in India but also to prevent the future exercise of any right that may have become vested in any person on such a High Court having been a High Court in India. This conclusion is inevitable from the absence of any saving clause in the Adaptation Order. Thus, even though the appellant had a right on the 14th August, 1947 to practise in the courts subordinate to any High Court in India such a right ceased to exist after the Adaptation Order mentioned above. We need merely add that if the appellant 's contention was correct, the anomalous position would have arisen that there would be no court in India which could take disciplinary action against him, in the event of misconduct. The scheme of the Bar Councils Act is as has been emphasised 968 earlier, that each High Court in the country should have disciplinary jurisdiction over the Advocates on its rolls. The provisions of the Adaptation order have maintained this position. In our opinion, the High Court rightly rejected the appellant 's application. The appeal is accordingly dismissed. In the circumstances of the case we make no order as to costs. But the appellant who has filed the appeal as a pauper is directed to pay the court fees which would have been paid by him if he had not been permitted to appeal as a paper. Appeal dismissed.

The appellant J who was enrolled as an advocate in the Chief Court of Sind in May 1947 came to India at the end of the year 1948, and practiced in the Courts at Delhi. The Chief Justice of Punjab High Court prohibited the appellant from practicing as an advocate in the Courts of Delhi. At 962 the time the appellant was enrolled he was an advocate for the purposes of the , and so was entitled as of right to practice in any subordinate courts in what then was British India. The question was whether this right continued to exist, after Sind ceased to form a part of India. ^ Held, that the Chief Court of Sind which was a High Court for the purposes of , upto August 14, 1947, ceased to exist as a High Court for the purposes of the , with effect from August 15, 1947, by virtue of section 5 of the India (Adaptation of Existing Indian Law) Order, 1947. The necessary consequence of this was that the Roll maintained by the Chief Court of Sind was from August 15, 1947, no longer a roll maintained by a High Court within the meaning of the , and any person whose name was entered on the Roll of the Chief Court of Sind ceased to be an advocate for the purposes of section 14 of the , and therefore ceased to have the right under that section to practice in courts of India. In the present case even though the appellant had a right on August 14, 1947, to practice in the courts subordinate to any High Court in India, such a right ceased to exist after the India (Adaptation of Existing Indian Laws) Order, 1947.

l Appeal ,#No. 151 of 1951. Appeal from a Judgment and Order dated 14/15th September, 1949, of the High Court of Judicature at Bombay (Chagla C.J. and Tendolkar J.) in Income tax Reference No. 2 of 1949. R. J. Kolah and N. A. Palkiwalla for the appellant. C. K. Daphtary, Solicitor General for India (P.A Mehta, with him) for the respondent. January 30. The judgment of Mehr Chand Mahajan J., Das J. and Bhagwati J. was delivered by Bhagwati J. Bose J. delivered a separate judgment. BHAGWATI J. This is an appeal from the judgment and order of the High Court of Judicature at Bombay upon a reference by the Income tax Appellate Tribunal under Section 66 (1) of the Indian Income tax Act, 1922, whereby the High Court upheld the decision of the Appellate Tribunal that two amounts of Rs. 12,68,480 and Rs. 4,40,878 were the sale proceeds of goods sold by the appellant to merchants in British India, were received in British India and were liable to income tax in British India. The appellant is a company registered in the Baroda State, as it then was, prior to its merger with India. It manufactures textile goods in Petlad in the Baroda State and after the goods are manufactured they are sold by the company ex mills. The company employs Messrs. Jagmohandas Ramanlal & Co. as guaranteed brokers. That firm guarantees the sale price of goods sold by the company ex mills to the purchasers from Ahmedabad and receives commission as consideration for the guarantee and the work which it does for the company. The company is a non resident and its accounts are maintained according to the mercantile system. 953 In the assessment year 1942 43 (the previous year being the calendar year 1941) the total sales of the goods by the company amounted to Rs. 29,68,808. In making the assessment on the company for that assessment year the following three amounts were considered for the purpose of determining the company 's liability to British Indian tax. (a) Sale proceeds recovered through Messrs. Jagmohandas Ramanlal & Co. . . . .Rs. 12,68,480 (b) Sale proceeds through British Indian banks and shroffs rec eived by means of drafts or hu ndies drawn by the company. . .Rs. 4,40,878 (Railway receipts handed over to British Indian merchants by the banks on payment). (c) Sale proceeds received by cheques on British Indian banks and hundies on British Indian shroffs and merchants, and collected by the banks and shroffs . . . . . . Rs. 6,719735 Total Rs. 23,81,093 As regards item (a) the company debited the account of the firm of Messrs. Jagmohandas Ramalal & Co. with Rs. 13,41,744 which represented sales made by the company to merchants of Ahmedabad whose payments were guaranteed by that firm, and credited the sales account with the amount of the bills. Messrs. Jagmohandas Ramanlal & Co. collected the amounts of the bills from the merchants at Ahmedabad and credited the sums recovered in the company 's accounts with banks and/or shroffs at Ahmedabad and also made dis bursements under instructions of the company to the creditors of the company in British India. All these payments were credited by the company to the account of Messrs. Jagmohandas Ramanlal & Co. and during the relevant accounting year the company thus 954 received Rs. 12,68,480 against the total debits of Rs. 13,41,744. As regards item (b) the company received Rs. 4,40.878 by drawing hundies or drafts for the amounts of its sales bills (including the forwarding charges and the cost of transit from the mills premises to the station) on the merchants in favour of recoginised banks and shroffs in British India, by sending the same to those banks or shroffs with the railway receipts duly endorsed in favour of the merchants and by instructing the banks or shroffs to recover the amounts including the costs of transmitting the same to them. The amounts of these sales bills were debited by the company to the accounts of the respective merchants and credited to the sales account and the sums recovered by the banks or shroffs from the merchants in British India against the delivery of the relative railway receipts were on receipt of the same by the company credited to the accounts of the respective merchants in their books of account. As regards item (c), the company received Rs. 6,71,735 from the merchants by cheques and hundies drawn on banks and shroffs in British India in favour of the company. These cheques and hundies were negotiated by the company in Petlad and sent back for credit to its accounts with those banks and shroffs. The said cheques and hundies were cashed in British India and the sale proceeds remitted by the banks and shroffs to the company. The amounts of the sales bills were debited to the accounts of the merchants in the books of the company when the goods were invoiced to the merchants and these accounts were credited with the moneys thus received by the company from the merchants. The Income tax Officer brought to tax the profits derived by the company represented by the said three items in the assessment year on the basis that the sale proceeds having been received in British India the profits were received in British India. The Appellate Assistant Commissioner on appeal held that profits 955 from items (a) and (c) were exempt from British Indian tax while those represented by item (b) were rightly taxed. The Department filed an appeal to the Appellate Tribunal against the decision of the Appellate Assistant Commissioner in regard to items (a) and (c) and the company filed an appeal in respect of item (b). The Appellate Tribunal held in regard to item (a) that the merchants in British India were not absolved either in law or in fact from their responsibility to pay to the company its dues by virtue of the debit entries in the account of Messrs. Jagmohandas Rainanlal & Co. and in regard to item (b) that the payment of the amounts due was a condition precedent to ' the delivery of goods by the banks in British India on behalf of the company. The Tribunal therefore held that profits arising from items (a) and (b) were rightly subjected to tax. As regards item (c) the Tribunal held that Rs. 6,71,735 "were received by the assessee company directly from the merchants in British India by cheques and hundies drawn on banks and shroffs in British India in favour of the company but were negotiated in Petlad and sent for credit to the company 's account. The amounts were received at Petlad and once they were received there, they could not be held to have been received again in British India ". The Department asked the Tribunal to refer to the High Court the question of law arising on item (c) and the company asked the Tribunal to refer to the High Court the question of law arising on items (a) and (b) and the Tribunal therefore referred the following question of law to the High Court: " Whether on the facts and in the circumstances of the case, the sums of Rs. 12,68,480, Rs. 4,40,878 and Rs. 6,71,735, or any of them, which, represents receipts by the assessee company of its sale proceeds in British India, include any portion of its income in British India?" The High Court held that Rs. 12,68,480 were received in British India and included the profits and gains of the business of the assessee company. It held that Rs. 4,40,878 also were received in British India 956 and the company was liable in respect of that amount. In regard to the item of Rs. 6,71,735, the High Court found that the facts stated by the Tribunal were not sufficient to enable it to reach a decision and therefore directed that the Tribunal should submit a supplementary statement of case setting out the several aspects set out in the judgment. The High Court reframed the question in regard to the two items of Rs. 12,68,480 and Rs. 4,40,878 in the manner following: (1)Whether the sums of Rs. 12,68,480 and Rs. 4,40,878 were sale proceeds of the goods sold by the assessee to merchants in British India or were debts due by the said merchants ? (2)Whether if they were sale proceeds, they were received in British India ? and answered them by stating that they were sale proceeds and they were received in British India. There was also a third question which was comprised in the reference and that question was framed as under: Whether the profits of the assessee 's business are included in the sums of Rs. 12,68,480 and Rs. 4,40,878 ? This question was also answered by stating that they were included in these two sums. The company obtained leave from the High Court to appeal against the decision in regard to the two sums of Rs. 12,68,480 and Rs. 4,40,878 and hence this appeal. It is common ground that the company is a nonresident and its accounts have been regularly kept according to the, mercantile system. Its balance sheets were also prepared on that basis. The company was assessed to tax in British India on the basis that these two sums of money were received in British India by or on behalf of the company. In regard to the item of Rs. 12,68,480, even though the amounts of the sales bills were in the first instance debited by the company in its books to the account of Messrs. Jagmohandas Ramanlal & Co. the sale proceeds in accordance with 957 the terms of the sales bills were paid by the respective merchants to Messrs. Jagmohandas Ramanlal & Co. in British India and were either credited by Messrs. Jagmohandas Ramanlal & Co. in the company 's accounts with banks or shroffs in British India or were disbursed by them in accordance with the instructions of the company in British India. In regard to the item of Rs. 4,40,878 even though the amounts of the sales bills were debited in the first instance by the company to the accounts of the respective merchants in the books of account at Petlad the relative railway receipts were sent by the company to banks or shroffs in British India together with drafts or hundies in connection with the same with instructions that delivery of the railway receipts should be given to the respective merchants against payment and the amounts of the sales bills were thus paid by the respective merchants to the banks or shroffs in British India and were transmitted under the instructions of the company by the banks and shroffs in British India to the company at Petlad. Prima facie therefore the amounts of the sales bills in both the cases whether they were paid to Messrs. Jagmohandas Ramanlal & Co. or to the banks or shroffs, through whom the railway receipts were negotiated were paid by the merchants in British India and were received by Messrs. Jagmohandas Ramanlal & Co. and the banks or shroffs on behalf of the company,in British India. The receipt of these amounts thus fell within section 4 (1) (a) of the Act and the profits or gains of this business thus were received in British India by or on behalf of the company. The company however sought exemption from liability to tax on the grounds (a) that the accounts of the company were kept on the mercantile or book profit basis under which the accrual of profit as shown in the account was the criterion of taxability and section 4(l) (a) had no application at all; (b) that it was obligatory on the authorities under section 13 of the Act to accept that system of maintaining accounts except under the proviso to that section and that the method of computation there was made the very basis of 124 958 chargeability and section 10 read with section 13 operated to save these amounts from chargeability and (c) that the amounts having been treated as received when credit entries were made in the books of account, and chargeability having crystallised on the date when the income accrued or was treated as received, there was no further scope for a charge when the amounts were subsequently actually received and the subsequent handling of the amounts by the company and the receipt thereof in British India were of no consequence. The mercantile system of accounting or what is otherwise known as the double entry system is opposed. to the cash system of book keeping under which a record is kept of actual cash receipts and actual cash payments, entries being made only when money is actually collected or disbursed. That system brings into credit what is due, immediately it becomes legally due and before it is actually received and it brings into debit expenditure the amount for which a legal liability has been incurred before it is actually disbursed. The profits or gains of the business which are thus credited are not realised but having been earned are treated as received though in fact there is nothing more than an accrual or arising of the profits at that stage. They are book profits. Receipt being not the sole test of chargeability and profits and gains that have accrued or arisen or are deemed to have accrued or arisen being also liable to be charged for income tax, the assessability of these profits which are thus credited in the books of account arises not because they are received but because. they have accrued or arisen. Mr. Kolah appearing for the company drew our attention to the following cases: Subramaniyan Chettiar vs Commissioner of Incometax(1), Ahmed Din Alladitta vs Commissioner of Income tax, Punjab(2), Kanwal Nayan Hamir Singh vs Commissioner of Income tax, Ajmer Merwara(3) and (1)(1927) (2)[1934] (3) 959 Commissioner of Income tax vs Shrimati Singari Bai(1). The assessees there were all residents in British India and maintained their books of account according to the mercantile system. Except in the case of Commissioner of Income tax vs Singari Bai(1) where the assessment was in respect of the total income or profits, stray items of income treated as received in British India were sought to be charged for tax and they were all assessed for tax not on the basis of actual receipts in British India but on the basis of their having accrued or arisen in British India. The cases were decided with reference to the law as it stood before the amendment in 1939 which under section 4(l) rendered liable to tax all income, profits or gains from whatever source derived, accruing or arising or received in British India or deemed under the provisions of the Act to accrue, arise or to be received in British India. The question that arose for the determination of the courts was whether under the mercantile system, profits which were credited in the books could be taxed even though they had in fact not been received and the conclusion reached by the courts was that these profits credited in the books of account were earned and could be charged as having accrued or arisen within British India even though they were in fact not received. In none of these cases were the courts con cerned with a non resident claiming to have received profits or gains outside British India under the mercantile system of accounting and claiming exemption from liability to tax under section 4 (1) (a) in respect of profits actually received in British India. It follows from the above that the mercantile system of accounting treats profits or gains as arising or accruing at the date of the transaction notwithstanding the fact that they are not received or deemed to be received and under that system, book profits are, assessed as liable to tax. If an assessee therefore regularly adopts the mercantile system of accounting he would be liable to tax on the profits thus credited by (1). [1945] 960 him in his books of account subject to all deductions for bad debts as provided in section 10 (2) (xi). Section 4 (1) (a) has nothing to do with this basis of taxation. Section 13 which is an integral part of the computation of the total income of the assessee and is compulsory on the income tax authorities as well when computing the total income (vide section 2 (15) ) does not lay down any exemption from liability. It only sets up a mode of computation of the income which is liable to assessment and imposes upon the income tax authorities an obligation to accept the mode of accounting regularly adopted by the assessee except in the cases where the proviso to that section comes into operation. The profits earned and credited in the books of account being thus taken as the basis of computation, the system of accounting postulates the existence of debts in so far as moneys re ain due and payable by the parties to whom they have been debited and when it is realised that these debts are not recoverable the assessee gets a deduction for the bad debts under section 10 (2) (xi). This however does not mean that the transaction as it has been recorded in the books of account under the mercantile system of accounting or the double entry system is metamorphosed or the relationship between the parties assumes a different character. What was in its inception a transaction of sale and purchase is not converted into another transaction as between creditor and debtor. The relationship as between vendor and purchaser still subsists and there does not come into existence a new relationship as between creditor and debtor with all its necessary consequences. The transaction as it has been recorded in the books of account has got to be worked out to its fullest extent. Merely because the goods have been supplied and the price thereof has been de bited to the purchaser the rights and obligations of the vendor and purchaser inter se are not in any manner affected. The vendor is bound to fulfil all his obligations under the contract and continues to be liable for all the consequences of his default including rejection of his goods by the purchaser or a claim for damages 961 for breach of warranty by him. The purchaser is equally entitled to reject the goods or to claim the damages as on breach of warranty by the vendor and all these rights and obligations have got to be worked out in spite of the fact that the entries 'are made in the books of account by the vendor in accordance with the mercantile system of accounting adopted by him. The vendor could not say that he is under no further obligation to the purchaser and that the purchaser must pay the price of the goods debited to him as a debt arising out of the book entry. The count in any action filed by the vendor against the purchaser would be a count for the price of goods sold and delivered and would not be a count on an assumpsit for recovery of a debt due by the debtor to him. It is clear that under these circumstances there is no receipt of the moneys at all, either actual or constructive, in cash or in kind, by actual payment or by adjustment or settlement of accounts. There is also no scope for the argument that even though these sums may not be said to be either actually or constructively received they should be "deemed to be received". The expression "deemed to be received" only means deemed by the provisions of the Act to be received. The phrase statutory receipt might be con veniently employed to cover income which is 'deemed to be received ' and instances of such statutory receipts are to be found in the provisions of the Act, e.g., section 18 (4), section 58 (E), section 58 (J) (3), section 7(2), section 16(1) (c) and sections 19 (2) (vii) and 16(2). (See the observations of Beaumont C.J. in Commissionei, of Income tax, Bombay vs New India Assurance Co. Ltd.(1). An amount cannot be "deemed to be received" merely by the volition or sweet will of an individual. In all the cases which we have mentioned above the profits earned which were credited in the books of account according to the mercantile system of accounting were at best "treated as having been received" which is neither "received" nor "deemed to be received" and therefore not within the purview of section 4 (1) (a). (1) at p. 614. 962 If then profits which have been thus credited cannot be said to be received nor deemed to have been received when the entries were made in the books of account, the contention urged before us by Mr. Kolah that there could not be a second receipt of the amount in British India does not survive. It is true that the words used in section 4(l) (a) relate to the first receipt after the accrual of the income. Once it is received by the party entitled to it, in respect of any subsequent dealing with the said amount it cannot be said to be " received" as income on that occasion. [Per Kania J. in B. M. Kamdar (1)]. The "receipt" of income refers to the first occasion when the recipient gets the money under his own control. Once an amount is received as income, any remittance or transmission of the amount to another place does not result in "receipt", within the meaning of this clause, at the other place. This was definitely established by the Privy; Council in Pondicherry Railway Co. vs Commissioner of IncomeTax 2) and in Commissionei, of Income tax vs Mathias (3). If, therefore, the income, profits or gains have been once received by the assessee even though outside British India they do not become chargeable by reason of the moneys having been brought in British India, because what is chargeable is the first receipt of the moneys and not a subsequent dealing by the assessee with the said amount. In that event they are brought, by the assessee as his own moneys which he has already received and had control over and they cease to enjoy the character of income, profits or gains. This ratio however does not apply to the facts of the present case before us. The moneys were neither received by the company nor could be deemed to have been received by it when the entries were made in the books of account at Petlad. They had merely accrued or arisen to it and so far as the receipt thereof is concerned they were first received in British India when they were received by Messrs. Jagmohandas Ramanlal (1)[1946] at P. 39, (2)[1931] 58 I.A. 239. (3) [1939] 66 I.A. 23. 963 & Co. or by the various banks or shroffs in British India through whom the railway receipts were negotiated. The first receipt of the moneys was therefore when they were paid as such by. the merchants to Messrs. Jagmohandas Ramanlal & Co. or to the various banks or shroffs as above. Whatever paid by the merchants to these several parties were the sale proceeds of the goods which had been sold and delivered by the company to them and they were received within the meaning of section 4 (1) (a) of the Act by these several parties on behalf of the company in British India at the time when these payments were made by the merchants to them. Mr. Kolah pressed into service the argument based on section 13 of the Act that the mercantile system of accounting regularly adopted by the assessee was obligatory on the income tax authorities for computation of his income. While agreeing generally with that submission in case of residents, we doubt whether that position would be available to a non resident, who maintains his books of account outside British India according to the mercantile system. The section would only be relevant where the total profits of the assessee have to be computed, in which event he would be entitled to claim that they should be computed according to the system of accounts maintained by him. But the section would hardly be relevant where stray items of income are caught in taxable territories as received in taxable territories by a nonresident. The entries in the present case were put in merely to prove that the sale proceeds were received outside British India where the entries were made. That contention however could not be sustained, as section 4 (1) (a) is concerned with cases of actual receipt and not with cases of paper receipts. Having regard to the observations made above we have come to the conclusion that the High Court ",as right in holding that the two sums of Rs. 12,68,480 and Rs. 4,40,878 were the sale proceeds of the goods sold and delivered by the appellant to merchants in British India, that they were received by Messrs, 964 Jagmohandas Ramanlal & Co. and by the banks and shroffs through whom the railway receipts were negotiated, on behalf of the appellant in. British India, that they were liable to tax under section 4 (1) (a) of the ,*Act as having been received in British India on its behalf, that there is nothing either in the facts and circumstances of the case or in law why they should be exempted from such liability, that the answers given to the questions which were ultimately considered by the High Court were correct, and the appellant was rightly held liable for the tax on these two amounts subject to all just deductions and allowances. The appeal therefore fails and must stand dismissed with costs. BOSE, J. I respectfully disagree. Section 3 of the Indian Income tax Act provides that the " total income " is to be charged in accordance with the provisions of the Act. We have therefore to see what " total income " means. " Total income " is defined in section 2(15). It means (not " includes " but means) the total amount of income, profits and gains "referred to in sub section (1) of section 4 computed in the manner, laid down in this Act." Therefore, the computation of all income refeffed to in section 4(l.) has to be "in the manner laid down in the Act ". Section 4 (apart from the provisos and explanations is divided into three clauses, (a), (b) and (c). Clause (b) deals with residents and (c) with nonresidents. As (a) is general, it is legitimate to infer that it refers to both. Therefore, the words " received" and " deemed to be received " must be construed in the same sense in both cases except of course where it is otherwise provided in the Act, for sub section (1) is made subject to the provisions of the Act. Now the words "deemed to be received" can be excluded from consideration at once because I agree that they are confined, and are intended to be confined to what I may call the deeming sections in the Act, that is to say, to cases where the deeming must be done 965 under the express provisions of the Act. That leaves us with the word "received" (I am of course only deal ing with section 4(l) (a) which deals with " receipts ' and not with section 4(l) (c) which refers to "accruals" and "arisals" and to that which is deemed to "accrue" or "arise"). Now this, in my opinion, is to be contrasted with the words "accrue" and "arise" which are used in clauses (b) and (c). Though there may be overlapping in some cases, I do not think the three are intended to mean the same thing. The Privy Council thought in Commissioner of Income tax vs Mathias(1) that there is some variation in meaning between them and in Commissioner of Income tax vs Chunilal B. Mehta(2) they drew attention to the antithesis between "accruing and arising in" and "received in", though they also said in the earlier case that there is not a complete disjunction between them and that they are not three mutually exclusive qualifications (page 56); that is, that there may be some overlapping in certain cases. Next, we turn to section 6 which divides the various sources of income under various heads for the purposes of computation and chargeability and states that each head shall be " chargeable" "in the manner hereinafter appearing". It is to be observed that the word "shall" has been used and not " may " thereby implying that there is no option in the matter. So far as business is concerned, the head is No. (iv) "Profits and gains of business etc. " That carries us on to sections 10 and 13 which prescribe the method of computation. Here again, the language is imperative and in the case of a business the method of computation has to be in accordance with the method of accounting regularly employed by the assessee: see Commissioner of Income tax vs Kameshwar Singh(3). Now in the present case, the method of accounting was the mercantile system. The essential difference (1) at 56. (3) at 100 and 101. (2) [1938] P I.T.R. 521 at 527, 125 966 between this and the cash basis system is that in the latter actual receipts and disbursements are taken into account. In the former, sums which are due to the business are entered on the credit side immediately they are legally due and before they are actually received and expenditures are entered the moment a legal liability to pay arises and before the actual disbursements. The profit or loss at the end of the accounting year is therefore based, not on a difference between what was actually received and what was actually paid out, but on the difference between the right to receive and the liability to pay. I find it impossible in such a case to say that the taxation is on income, or profits and gains which were "received". It can only be oil profits which " accrued " or "arose" to the assessee in the accounting year: see the Privy Council in Feroz Shah vs Commissioner of Income tax( '). That, in my opinion, excludes section 4(l) (a) and that in turn means that in such a case a resident is taxed under section 4(l) (b) and a non resident under section 4(l) (c). Now, this to my mind is of vital importance. The primary object of the Income tax Act is to tax and not merely to ascertain an income. The computation of the income is subsidiary and is only for the purposes of ascertaining the quantum of the tax: see Commissioner of Income tax vs Kameshwar Singh(2). Therefore, if the legislature chooses to lay down different methods of computation and say that the taxation shall be on the amount so computed, it is essential that these methods be adhered to. In some cases this may be to the advantage of the assessee and in others it may operate to his disadvantage. But that is immaterial. The importance lies in this. All that can be taxed in a given year are the profits and gains which are received or which arise or accrue in the " previous year", and if the Act directs that the profits are to be computed in a given case on "accruals" or "arisals" and not on actual receipts it is essential that that be (1) 224 and 225. (2) [1933] 1 I.T.R. 94 at 100. 967 done; and it follows from that that the tax in such a case can only be on the accruals or arisals and not on the actual receipts, for clearly you cannot tax on that which you are forbidden to compute in a case where the tax can only be levied on what is computable. under the Act. It is important to draw the distinction for this reason. The rate of tax varies from year to year, therefore if the book profits which are directed to be taxed in a given year are, say, Rs. 10,000 and the actual receipts only Rs. 100, it makes a lot of difference which figure is taken; nor does it even itself out in the long run, for if the rate of taxation increases in the following year and the state of the business is just the reverse, namely that the book profits are only Rs. 100 whereas the actual receipts arising from the previous year 's transactions are Rs. 10,000, it will make a considerable difference to the assessee in the aggregate of tax payable over the years, whether he pays oil the basis of book profits or actual receipts in the two years. I am not able to draw a distinction between a resident and a non resident in these matters. I can find no ground for holding that in the case of a resident the mercantile system must be adopted for computing the profits if that is the system of accounting regularly employed but that that need not be done in the case of a non resident. If the assessee had been a resident company, the taxation would, in my opinion, have been under section 4(l) (b) on profits and gains which had accrued or arisen and not under section 4 (1) (a) on profits which had been received. The same principle must, in my opinion, be applied in the case of a nonresident and therefore section 4 (1) (c) is attracted, provided the profits and gains have actually accrued or arisen in the taxable territories or they can, because of section 42, be deemed to have accrued or arisen there. If section 4 (1) (c) is not attracted, then the tax cannot be levied. Now, applying section 4 (1) (c), the question is where do the profits and gains arise or accrue, in a case 968 like the present ? This is not free from difficulty and various views have been, and can be, taken. But as these expressions have not been defined and as they are not words of art, I think they should be construed in their ordinary meaning which businessmen would ordinarily and easily understand in a business transaction. When goods are sold it is to my mind evident that the profit or the loss on any particular transaction arises out of the sale, for until there is a sale there can be no profit. The profit may not be wholly attributable to the sale but that is another matter. It is to my mind unquestionable that they arise, in part, at any rate, out of the sale. Therefore, if the goods are sold in the taxable territories, then, to my mind, the profits, or a portion of them, arise there. As the Privy Council pointed out in Commissioner of Income tax vs Chunilal B. Mehta(1), in determining where the profits arise the place of the formation of the contract is not the sole criterion, other matters, as for example acts done under the contract are also material. I am not here attempting to go behind the decision of the Supreme Court to the effect that the place of sale is not necessarily the place of the receipt of the profits. I am construing the word "arise " and not "receive". That brings me to the next question, where were the goods in the present ease sold ? That is a, mixed question of fact and law and must vary in each case and must, in my opinion, be answered in a commonsense way and not necessarily in the artificial manner laid down by the Sale of Goods Act to determine where and when the property passes. What are the facts here ? In the case of the Rs. 4 lakhs odd, the control over the corpus of the goods was retained by the assessee right up to the moment the price was paid; and the price was paid not outside British India but to his nominees in this country, namely, to the assessee 's banks in British India. These banks retained the documents of title and had the right to refuse (1) [1938]61.T.R.521 at533. 969 delivery until the money was actually handed over. Therefore, the right to get possession of the goods and to take delivery accrued or arose in British India where the money was actually paid, and that to my mind must be taken to be the place where the profits accrued and arose for income tax purposes, not because the money was received there, for we are not concerned with actual receipts, but because the right which accrued at the date of the transaction was to receive the money in British India and hand over the goods there on the receipt of the money. As I have said, the substance of the transaction must be viewed and that cannot be made to depend upon the method of book keeping. Even if there are no books the profits on such a transaction would accrue in the place where the money is to be paid and the goods are to be handed over. I cannot see how that can alter by reason of the method of accounting employed. Accordingly, I agree that the method of accounting adopted by the assessee cannot affect the substance of the transactions between the parties or affect their nature. The rights and liabilities of the parties inter se cannot be made to depend on the way in which one of them chooses to keep its books. But that is not the case when we come to the question of taxation for income tax purposes. There the method of accounting is vital. But even there the substance of the transaction must be viewed, for the substance cannot alter by a mere method of accounting. It is evident that if the assessee had been resident in British India and these transactions had been omitted from tile books, the sums which ought to have been entered would be taxable as items which had escaped assessment even if there had been no actual receipts in that or in any following year. Therefore, it is not the entry in the books which attracts the taxation but the profits on the transaction itself, and when the mercantile system is used the profits arise when the right to receive them accrues and not when the entry is made. If the system is properly employed the entry is made as soon as the right to receive the price arises and so for all practical 970 purposes that is the date ordinarily referred to, but a man cannot manipulate the amount of his tax by choosing to enter or not to enter items which ought to be entered on a particular date, as and when he pleases. Now, the Rs. 4 lakhs odd represent actual receipts but that is not what is taxable when the computation is based on the mercantile system. What should be taxed, or rather taken into account for the purposes of taxation, are the figures entered in the accounting year as the sale price of the various transactions which the Rs. 4 lakhs represent. The profits which arise out of these transactions do not, on my view, escape tax because the profits accrue or arise in the taxable territories. But the figure on which the tax is to be computed is not the 4 lakhs odd which represent the actual receipts but another figure which unfortunately we have not been given. I am of course assuming that the figures were duly entered in the books at the proper time in accordance with the mercantile system of accounting. If they were not, then the Income tax authorities have power to tax income which, for one reason or another, has escaped assessment Turning to the Rs. 12 lakhs. We know that the figure entered in the books relating to these transactions was Rs. 13,41,744. i am not clear whether that was entered in the accounting year with which we are concerned, though I gathered that that was the case. The actual receipts, which followed later, amounted to only Rs. 12,68,480. In my opinion, if anything is computable for the purposes of tax, it is the former figure (assuming all the entries are in the accounting year) and not the latter. But in order to determine whether the profits on these transactions are taxable at all, we must examine the transactions. In these cases the sales were to merchants resident in Ahmedabad. But according to the assessee 's affidavit, " In respect of buyers from Ahmedabad, the apllicant Mills have no account of such buyers. The 971 price is debited to the account of the said Jagmohandas Ramlal and company and credited to the sales account in the books of the applicant:" and later, Jagmohandas " discharges its debts by making payments to the applicants from time to time towards the balance in their said account in the books of the applicant Mills. The said amounts are paid by the said firm by paying the same to the credit of the applicant Mills with British Indian banks or shroffs. " Now, it is evident from this that Jagmohandas & Company do not merely guarantee payment by the Ahmedabad buyers but actually make the payments, or the equivalent of payments, to the assessee company. So little do the 'buyers matter that their transactions are not even reflected in the accounts. All we have is Jagmohandas. It does not, in my opinion, matter whether the actual buyers remained primarily and legally responsible to the assessee or not. The fact remains that in practice Jagmohandas & Company actually met the obligations of the buyers and discharged their liabilities to the assessee. it is, equally clear that Jagmohandas & Company must have recouped themselves in some way from the buyers. The question is how. If the whole of the transactions occurred outside British India and the buyers or their agents went to Petlad and received the goods there and paid Jagmohandas & 'Company outside British India, then I am clear that the profits and gains did not accrue or arise in British India, simply be cause the (foods were ultimately brought there. But if Jagmohandas & Company or their agents were paid in British India, the profits and gains, in my opinion, arose there in the same way as in the 4 lakhs case. If Jagmohandas & Company were the actual agents of the assessee as were the banks in the other case, and the payments were made in the taxable territories, then the accrual and arising was direct. If, however, they were not the agents in the strict sense of the term, then I am of opinion that section 42 would be attracted because at the very least there would be a "business connection", 972 provided of course the payments were made in the taxable territories. Now, here again. , I am looking to what was actually done in order to determine what the rights were, for it is evident that what was done was done in pursuance of some agreement, express or implied, between the parties which agreement regulated their rights, and those rights in turn determine the place where the profits accrued or arose, or must, because of section 42, be deemed to have accrued or arisen. In my view, the question referred by the Incometax Appellate Tribunal in its statement of the case does not reflect the true position because it concentrates on the actual receipts. If the cash basis system of accounting was germane here, then I would agree that the Rs. 4,40,878 was part of the assessee 's income in British India, and so also in the other case, provided the payments were made in British India. But it is misleading to enquire what would have happened in circumstances which are not material in this case because of the mercantile system of accounting which was employed. As regards the High Court. The learned Judges refrained the question and answered it without sending the case back to the Income tax Appellate Tribunal for a further statement of the case. That was not strictly proper. But, in my opinion, the refrained questions suffer from the same defect. In my opinion, the case should be sent back to the Income tax Appellate Tribunal for a refraining of the questions along the lines I have indicated and for a further statement of the case. Appeal dismissed.

A non resident company manufactured textile goods at P out side British India and sold the goods ex mills. A firm, R & Co., guaranteed the sale price of goods sold ex mills by the company to purchasers at Ahmedabad within British India. As the company maintained its accounts according to the mercantile system, the company debited R & Co., with the price of goods sold and credited the sales account with the amount of the bills. R & Co., collected the amounts of the bills from the purchasers on behalf of the company and credited the sums realised in the company 's account with banks at Ahmedabad and also disbursed them to creditors of the company in British India. These payments were credited by the company to R & Co. During the relevant accounting year the company thus received Rs. 12,68,480. The company also received Rs. 4,40,878 from sales to purchasers in British India. The amount of the sales bills for which hundis were drawn on the purchasers in favour of banks were debited by the company to the accounts of the respective merchants and credited to the sales account and the sums received by the banks from the purchasers against delivery of the railway receipts were credited by the company to the accounts of the respective purchasers. In either case there was no change in the relationship of vendor and purchaser between the company and the purchasers by reason of the entries made in the company 's books. The question as re framed by the High Court was whether these two sums were sale proceeds of the goods sold by the assesses to merchants in British India and whether they were received in British India and could be included in the assessable income of the company in British India: Held, per Mehr Chand Mahajan, section B. Das and Bhagwati J.J., (Vivian Bose J. dissenting) that the two amounts in question were sale proceeds of the goods sold and delivered by the company to merchants in British India ; that they were neither received by the company nor could be deemed to have been received by it when the entries were made in the books of account at P but had 951 merely accrued or arisen to it there; that they were first received by R & Co. and by the banks through whom the railway receipts were negotiated on behalf of the company in British India; and that they were therefore liable to tax under section 4(l) (a) of the Indian Income tax Act as having been received in British India on its behalf. Though it is true that in the case of residents, if the assessee employs the mercantile system regularly it is obligatory on the income tax authorities to compute the income according to that system, it is doubtful whether that position would be available to a non resident who maintains his books of account outside British India according to the mercantile system. Section 13 would only be relevant where the total profits of the assessee have to be computed and in that event the assessee would be entitled to claim that they should be computed according to the system of accounts maintained by him; it would not be relevant when stray items of income are sought to be assessed in the taxable territories as received in the taxable territories by a non resident. Bose J. In the case of accounts kept in the mercantile system, the profit or loss at the end of the accounting year is based not on a difference between what was actually received and what was actually paid out, but on the difference between the right to receive and the liability to pay. The taxation in such cases is not on income, profits or gains which were received but on profits which "accrued or arose" to the assessee in the accounting year. This view excludes section 4(l) (a) and this means that a resident is taxed in such cases under section 4(l)(b) and a non resident under section 4(l) (c). Applying section 4(l) (c) to the present case, in the case of the Rs. 4 lakhs odd the profits accrued or arose in British India where the right to take delivery of the goods accrued and where the price was actually paid, but what is really taxable under section 4 (1) (c) is not the Rs. 4 lakhs odd, but the figures entered in the accounting year as the price of the various transactions which the Rs. 4 lakhs represented. Similarly, in the case of Rs. 12 lakhs odd, it is the figure entered in the books in the accounting year relating to the transactions which is taxable. By the Full Court. The expression "deemed to be received" in section 4 (1) (a) means deemed by the provisions of the Act to be received. Subramaniyan (Chettiar vs Commissioner of Income tax (2 I. T. C. 365), Ahmed Din Alladitta vs Commissioner of Income tax, Punjab , Kanwal Yayan Hanir Singh vs Commissioner of Income tax, Ajmer Merwara , Commissioner of Incometax vs Singari Bai (13 l. T.R. 224) distinguished. B.M. Kamdar, In re , Pondicherry Railway Co. vs Commissioner of Income tax (58 I.A. 239) and Commissioner of 952 Income tax vs Mathias (66 I.A. 23), Commissioner of Income tax vs Kameswar Singh , Commissioner of Income tax vs Chunilal Mehta referred to.

Civil Appeal No. 94 of 1959. Appeal by special leave from the judgment and decree dated May 7, 1957, of the Punjab High Court (Circuit Bench) at Delhi in Civil Revision Application No. 144 D of 1957. Bishan Narain R. Mahalingier and B. C. Misra for the appellants. 935 Gurbachan Singh and Harbans Singh, for the respondent. December 5. The Judgment of Sinha, C.J., Hidayatullah and Shah, JJ., was delivered by Hidayatullah, J. Kapur, J. delivered a separate judgment. HIDAYATULLAH, J. The appellants (in this appeal by special leave) are the sons of one Gauri Shankar, who owned a bungalow known as 5, Haily Road, New Delhi. This bungalow was given to the respondent by Gauri Shankar on a monthly rent of Rs. 234 6 0, excluding taxes. The suit, out of which this appeal arises, was brought by the appellants against the respondent, Rao Girdhari Lal Chowdhury, for his eviction on the ground (among others) that he had sub let a portion of the bungalow after the commencement of the Delhi and Ajmer Rent Control Act, 1952 (38 of 1952) to one, Dr. Mohani Jain, without obtaining the consent in writing of the landlord, as required by section 13(1)(b)(i) of the Act. The defence was that the original contract of tenancy was entered into sometime in 1940 and a term in the contract gave the tenant right to sub let. It was alleged that a letter written by the tenant which embodied the terms of the tenancy was in the possession of the landlord and a demand was made for its production. The case of the tenant was that the sub tenancy commenced in the year 1951, that is to say, before the passing of the Act of 1952, and the tenant was not required to obtain the written consent of the landlord to sublet Admittedly, in this case, no written consent was proved. We need not mention the other allegations and counter allegations which are usual in proceedings between landlords and tenants, the most important of them being about the arrears of rent, which the tenant under permission of the Court ultimately deposited in Court. 936 The issue on which the decisions below have differed was framed by the Sub Judge, First Class, Delhi, in the following terms: "Did the plaintiff consent to the sub letting of parts of the demised premises by the defendant ? If so, when and to what effect. " The trial Judge found that there was no evidence that the landlord was ever consulted before a portion of the bungalow was sublet to Dr. Mohani Jain, and further that the sub tenancy was created after June 9, 1952, the date on which the Act came into force. In reaching the latter conclusion, the trial Judge made a reference to a dispute between the tenant and Dr. Mohani Jain for fixation of standard rent before the Rent Control authorities. In those proceedings, Dr. Mohani Jain had alleged that she was living as a sub tenant from the end of 1951, but the tenant had denied this fact. The proceedings before the Rent Control authorities ended in a compromise, but the admission of the tenant was relied upon to support the conclusion that the sub tenancy commenced after the Act. The trial Judge decreed the suit. The decision of the trial Judge was confirmed on appeal by the Additional District Judge, Delhi. Though Dr. Mohani Jain gave oral evidence in this case that her sub tenancy commenced in December 1951, the Additional District Judge found categorically that the sub tenancy commenced sometime after the coming into force of the Act. He held that even if Dr. Mohani Jain was living there even from before it was a guest and not as a sub tenant. Against the order of the Additional District Judge, a revision was filed under section 35 (1) of the Act. That section reads as follows: "The High Court may, at any time, call for the record of any case under this Act for the purpose of satisfying itself that a decision 937 made therein is according to law and may pass such order in relation thereto as it thinks fit. " Acting in accordance with a decision of the Punjab High Court as to the ambit of this section, the learned single Judge, who heard the revision application, thought that it was competent for him to reconsider the concurrent findings about the time when the sub tenancy commenced. He held that Dr. Mohani Jain 's statement showed that the sub tenancy commenced prior to the passing of the Act, and that the landlord 's consent in writing was not necessary. In reaching this conclusion, the learned Judge was of opinion that all the evidence was not considered by the two Courts below, and that he was entitled, in view of the interpretation placed upon the section above quoted, to go into the matter afresh, and decide the question of fact. It may be pointed out that while the suit was pending before the Subordinate Judge, an application was made for the production of the letter referred to in the written statement of the tenant, to which a passing reference has already been made. A letter was produced, and it is exhibit D 1. That letter does not disclose all the terms of the tenancy and it would appear, therefore, that the terms of the original tenancy have not been proved in this case, and there is no material on which it can be said either way as to whether a right to sublet was conferred upon the tenant. The defendant did not insist in the Court of first instance that there was yet another letter, and the argument to that effect in this Court cannot be entertained. In reaching the conclusion that all the evidence pertinent to the issue was not considered, the learned Judge of the High Court stated that Ex. P 19, which was the petition filed by Dr. Mohani Jain under section 8 of the Act to get the standard rent fixed was not taken into account by the Additional District Judge. That petition contained an averment 938 that her sub tenancy commenced on December 1, 1951 with a rent of Rs. 100/ per month, and that a cheque for Rs. 1,800/ as advance rent for 18 months was given by her in the name of the daughter of the tenant, because the tenant represented that he had no account in the bank and therefore a cheque should be given in the name of his daughter. This, the learned Judge felt, adequately supported the statement of Dr. Mohani Jain to the same effect as a witness in this case. The learned Judge was in error in thinking that exhibit P 19 was not taken into account by the Additional District Judge. The latter had, in fact, considered exhibit P 19, the petition of Dr. Mohani Jain, before the Rent Control authorities. exhibit P 20, the reply of the tenant to that petition and Ex. P 21, the petition of compromise; but he cited Exs. P 20 and P 21 only. There is internal evidence to show that exhibit P 19 was, in fact, considered, because after mentioning the two Exhibits, the learned Additional District Judge goes on to say as follows: "The first of these is the written statement of the present appellant which he had filed in a case brought by Dr. Mohani Jain against him for the fixation of fair rent. There he had completely denied somewhere in the year 1953 that Dr. Mohani Jain was his subtenant and could not sue for fixation of rent. This was enough to show that right up to the year 1953 the appellant himself did not regard Dr. Mohani Jain as a sub tenant. " This clearly shows that the learned Additional District Judge was weighing exhibit P 19 as against exhibit P20 and was acting on exhibit P 20, which contained a material admission by the tenant before the present dispute had begun. The learned single Judge was, therefore, in error in departing from a concurrent finding of fact on a wrong supposition. 939 But the question that arises in this appeal is one deeper than a mere appraisal of the evidence. It is whether the High Court in the exercise of its revisional power is entitled to re assess the value of the evidence and to substitute its own conclusions of fact in place of those reached by the Court below. This question requires an examination of the powers of revision conferred on the High Court by section 35 of the Act. That question is one of common occurrence in Acts dealing with some special kinds of rights and remedies to enforce them. Section 35 is undoubtedly worded in general terms, but it does not create right to have the case reheard, as was supposed by the learned Judge. Section 35 follows section 34, where a right of appeal is conferred; but the second sub section of that section says that no second appeal shall lie. The distinction between an appeal and a revision is a real one. A right of appeal carries with it a right of rehearing on law as well as fact, unless the statute conferring the right of appeal limits the rehearing in some way as, we find, has been done is second appeals arising under the Code of Civil Procedure. The power to hear a revision is generally given to a superior Court so that it may satisfy itself that a particular case has been decided according to law. Under section 115 of the Code of Civil Procedure. the High Court 's power are limited to see whether in a case decided, there has been an assumption of jurisdiction where none existed, or a refusal of jurisdiction where it did, or there has been material irregularity or illegality in the exercise of that jurisdiction. The right there is confined to jurisdiction and jurisdiction alone. In other acts, the power is not so limited, and the High Court is enabled to call for the record of a case to satisfy itself that the decision therein is according to law and to pass such orders in relation to the case, as it thinks fit. The phrase "according to law" refers to the decision as a whole, and is not to be equated to 940 errors of law or of fact simpliciter. It refers to the overall decision, which must be according to law which it would not be, if there is a miscarriage of justice due to a mistake of law. The section is thus framed to confer larger powers than the power to correct error of jurisdiction to which section 115 is limited. But it must not be overlooked that the section in spite of its apparent width of language where it confers a power on the High Court to pass such order as the High Court might think fit is controlled by the opening words, where it says that the High Court may send for the record of the case to satisfy itself that the decision is "according to law". It stands to reason that if it was considered necessary that there should be a rehearing, a right of appeal would be a more appropriate remedy, but the Act says that there is to be no further appeal. The section we are dealing with, is almost the same as section 25 of the Provincial Small Cause Courts Act. That section has been considered by the High Courts in numerous cases and diverse interpretations have been given. The powers that it is said to confer would make a broad spectrum commencing, at one end, with the view that only substantial errors of law can be corrected under it, and ending, at the other with a power of interference a little better than what an appeal gives. It is useless to discuss those cases in some of which the observations were probably made under compulsion of certain unusual facts. It is sufficient to say that we consider that the most accurate exposition of the meaning of such sections is that of Beaumont, C.J. (as he then was) in Bell & Co. Ltd. vs Waman Hemraj (1) where the learned Chief Justice, dealing with section 25 of the Provincial Small Cause Courts Act, observed: "The object of section 25 is to enable the High Court to see that there has been no miscarriage of justice, that the decision was given according to law. The section does not enumerate 941 the cases in which the Court may interfere in revision, as does s.115 of the Code of Civil Procedure, and I certainly do not propose to attempt an exhaustive definition of the circumstances which may justify such interference; but instances which readily occur to the mind are cases in which the Court which made the order had no jurisdiction or in which the Court has based its decision on evidence which should not have been admitted, or cases where the unsuccessful party has not been given a proper opportunity of being heard, or the burden of proof has been placed on the wrong shoulders. Wherever the court comes to the conclusion that the unsuccessful party has not had a proper trial according to law, then the Court can interfere. But, in my opinion, the Court ought not to interfere merely because it thinks that possibly the Judge who heard the case may have arrived at a conclusion which the High Court would not have arrived at. " This observation has our full concurrence. What the learned Chief Justice has said applies to section 35 of the Act, with which we are concerned. Judged from this point of view, the learned single Judge was not justified in interfering with a plan finding of fact and more so, because he himself proceeded on a wrong assumption. The appeal thus succeeds, and is allowed with costs. The order under appeal is set aside, and that of the Additional District Judge restored. As regards eviction, the respondent has given an undertaking that he would vacate the house on or before April 25, 1962, and this has been accepted by the appellants. KAPUR J. I agree that the appeal should be allowed and that the High Court was in error in interfering with the finding of fact, but in my 942 opinion the power of revision under section 35(1) of the Delhi & Ajmer Rent Control Act is not so restricted as was held by Beaumont, C. J., in Bell & Co. Ltd. vs Waman Hemraj(1), a case under section 25 of the Provincial Small Cause Courts Act. The section provides that the order passed should be in accordance with law and if it does not then the High Court can pass such order as it thinks fit. The language used in section 35(1) of the Act is almost identical with the words of the proviso to s.75(1) of the Provincial Insolvency Act. The power under that proviso has been thus commented upon by Mulla in his Law of Insolvency at page 787 of 2nd Edition: "The power given to the High Court by this proviso is very wide. In the exercise of this power the High Court may set aside any order if it is not `according to law '. " The power under the Insolvency Act has not, by the Courts in India, been considered to be do restricted as the observations of Beaumont, C. J. in Bell & Co. Ltd. vs Waman Hemraj(1) seem to suggest in regard to section 25 of the Small Cause Courts Act. This power of interference by the High Court is not, in my opinion, restricted to proper trial according to law or error in regard to onus of proof or proper opportunity of being heard. It is very much wider than that. When, in the opinion of the High Court, the decision is erroneous on a question of law which affects the merits of the case or decision is manifestly unjust the High Court is entitled to interfere. The error may not necessarily be as to the interpretation of a provision of law, it may be in regard to evidence on the record. Thus when material evidence on the record is ignored or a finding is such that on the evidence taken as a whole no tribunal could, as a matter of legitimate inference arrive at. It is neither possible nor desirable to enumerate all 943 cases which would fall within the jurisdiction of the High Court under section 35(1) of the Act but it is not to be narrowly interpreted nor to be so widely interpreted as to convert the revision into an appeal on facts. Appeal allowed.

In an ejectment suit under the Delhi & Ajmer Rent Control Act, 1952, the trial Judge decreed the suit and on appeal under s.34 of the Act the Additional District Judge confirmed 934 the decision. The Act did not provide for a second appeal, and under section 35 (1) a revision was filed against the Order of the Additional District Judge The single Judge of the Punjab High Court following a previous decision of the same High Court, was of opinion that in assessment as all the evidence was not considered it was competent for him to reconsider the concurrent findings of the courts below. The question is whether the High Court in exercise of its revisional powers is entitled to re assess the value of the evidence and to substitute its own conclusions of facts in place of those reached by the courts below. ^ Held, (per Sinha, C. J., Hidayatullah and shah, JJ, that though section 35 of the Delhi and Ajmer Rent Control Act is worded in general terms, but it does not create a right to have the case re heard. The distinction between an appeal and revision is a real one. A right to appeal carries with it right of re hearing on law as well as fact, unless the statute conferring the right to appeal limits the re hearing in some way. The power to hear a revision is generally given to a superior court so that it may satisfy, itself that a particular case decided according to law. The phrase "according to law" in section 35 of the Act refers to the decision as a whole, and is not to be equated to errors of law or of fact simplicitor. All that the High Court can see is that these has been no miscarriage of justice and that the decision is according to law in the sense mentioned. per Kapur, J. The power under section 35 (1) of the Act of interference by the High Court, is not restricted to a proper trial according to law or error in regard to onus of proof or proper opportunity of being heard. It is very much wider than that when in the question of the High Court the decision is erroneous on a question of law which affects the merits of the case or decision is manifestly unjust the High Court is entitled to interfere. Bell and Co. Ltd. vs Waman Hemraj approved.

Civil Appeal No. 325/61. Appeal from the judgment and decree dated March 6. 1961, of the Allahabad High Court in Writ No. 3116 of 1960. WITH Petitions Nos. 180, 181 and 205 of 1961. Petitions Under article 32 of the Constitution of India for enforcement of Fundamental Rights. section N. Kacker and J. P. Goyal, for the appellant (In C.A. No. 325/61) and the petitioner (In Petn. No. 205/61). H.N. Sanyal, Additional Solicitor General of India, K.L. Misra, Advocate General, U. P. H. N. Seth, J. K. Srivastva and C. P. Lal, for the respondents (in C.A. No. 325/61 and Petn. No. 205 of 1961). J. P. Goyal, for the petitioners (In petitions Nos. 180 and 181 of 1961). C. P. Lal, for the respondents (In Petitions Nos. 180 and 181 of 1961). December II. The Judgment of the Court was delivered by SHAH, J. The appeal and the writ petitions practically raise the same points and may be 78 disposed of together. At the outset we shall briefly state the facts relevant to each of the said proceedings. The appellant in Civil Appeal No. 325 of 1961 held a permit for plying stage carriage on the Kanpur Bela Bidhuna route via Chaubepur, in the State of Uttar Pradesh. The entire route is 68 miles long, and a part of the route 16 miles in length i.e., Kanpur to Chaubepur, is a notified route. This part was common between the said route and the Kanpur Chaubepur Sarai Miran route, which was a nationalised route. A condition was, therefore, attached to the appellant 's permit that he would not be entitled to pick up passengers or drop them between Kanpur and Chaubepur. His permit was to expire on June 10, 1960. Before the said date, he applied for renewal of his permit, and on May 20, 1960 it was published in the U.P. Govt. Gazette calling for objections. On the same day, the State Government published a notification in the Gazette proposing to nationalise the said route. As the application for renewal could not be disposed of before the expiry of the period fixed in the permit a temporary permit for the route was granted to the appellant. On July 19, 1960 the application for renewal of the appellant 's permit was considered by the Regional Transport Authority, Kanpur, and his permit was renewed for three years with effect from July 23, 1966, only in respect of a part of the old route, namely, Chaubepur Bela Bidhuna; but under the directions of the Transport Commissioner, the Regional Transport Authority made an endorsement on the renewed permit authorizing the appellant to ply his vehicle between Kanpur and Chaubepur for a period of four months commencing from July 23, 1960. As regards the proposed scheme of nationalization, on June 22, 1960 the appellant filed his objections thereto. The said objections were heard by the Joint Secretary, Judicial 79 Department, who approved the scheme with some modifications. The approved scheme was published in the Gazette on October 8, 1960. Under the notification the scheme was to be put into operation from October 5, 1960 or thereafter. On November 12, 1960, a notification dated November 4, 1960 was published in the Gazette under section 68F of the cancelling the appellant 's renewed permit with effect from November 27, 1960. Under the nationalization scheme the stage carriages belonging to the State Transport Undertaking could ply on the said route without obtaining permits. The appellant filed a petition under Art, 226 of the Constitution in the High Court of Judicature at Allahabad praying for the following reliefs: (a) That a writ in the nature of mandamus may issue to command the respondents not to interfere with the Petitioner 's right to ply on Kanpur Bela Bidhuna Via Chaubepur route under the permit duly renewed in his favour till the entire duration of the permit viz., till July 22, 1963. (b) That a Writ in the nature of certiorari may issue to quash so much of the Resolution dated July 19, 1960 passed by the Regional Transport Authority, Kanpur, as directs imposition of illegal conditions to the renewed permit of the petitioner. (c) That a Writ in the nature of mandamus may issue to command respondents No. 2 and 3 not to give effect to the illegal endorsements made on the petitioner 's permit on July 23, 1960 and to treat the petitioner 's permit as having been renewed without the illegal conditions attached thereto by the two endorsements dated July 23, 1960, reproduced in paragraph 15 of the affidavit. 80 (d) That a Writ in the nature of certiorari may issue to quash the notifications dated May 18, 1960 under section 68C of the Act, so also the subsequent notifications under section 68D(2) of the Act dated September 26, 1960 and the notification dated November 4, 1960 under section 68F (2) of the Act in regard to Kanpur Bela Bidhuna route. (e) That a Writ in the nature of mandamus may issue directing the respondents Nos. 1 to 3 not to give effect to the notifications dated May 18, 1960, September 26, 1960 and November 4, 1960 in regard to Kanpur Bela Bidhuna route. (f) That an interim direction may issue to the respondents Nos. 2 and 3 not to interfere with the Petitioner 's right to ply on the entire Kanpur Bela Bidhuna route under the renewed permit irrespective of the illegal conditions attached thereto or of the illegal scheme for the nationalization of the said route. (g) That costs of this petition may be awarded to the Petitioners as against the opposite parties. On December 2, 1960 the High Court made an interim order directing the State of Uttar Pradesh not to interfere with the petitioner operating his vehicle on Kanpur Bela Bidhuna route in accordance with the terms of his permit. To that writ petition, the State of Uttar Pradesh, the Regional Transport Authority, and the Secretary to Regional Transport Authority, were made respondents. The respondents opposed the petition. On March 6, 1961 a Division Bench of the High Court, accepting the contentions raised by the respondents, dismissed the petition. Hence the appeal. 81 Writ Petition No. 205 of 1961 is filed in this Court by another operator under article 32 of the Constitution. He was plying his stage carriage on the Jaunpur Shahganj route in Uttar Pradesh under Permit No. 430, which was valid upto March 15, The State Government published in the Gazette dated July 23, 1960 a notification dated July 15, 1960 under section 68C of the Act proposing to nationalize the said route along with another route. The petitioner and others filed objections against the scheme within the time prescribed. The objections were heard by the Joint Secretary, Judicial Department, who approved the scheme. The approved scheme was published in the U. P. Official Gazette dated February 25, 1961. Thereafter, the Secretary to the Regional Transport Authority, Allahabad, issued a notification dated July 29, 1961 wherein it was stated that the permits of the operators on the said routes including that of the petitioner would stand cancelled and that the notification would come into force upon the expiry of 15 days from the date of publication of the said notification. The petitioner has filed the present writ petition asking for the following reliefs: (a) A writ in the nature of certiorari quashing the notification (Annexures A, B and C to this writ petition). (b) A writ in the nature of mandamus directing the respondents not to give effect to the notifications. (c) A writ in the nature of mandamus commanding the respondents not to interfere with the rights of the petitioner to ply his stage carriage on the aforesaid route (Jaunpur Shahganj route), due to the aforesaid scheme. (d) Award the costs of this petition to the petitioner. 82 Writ Petitions Nos. 180 and 181 of 1961 relate to the route Robertasgunj Dudhi Mamhani. The State Government issued a notification dated July 13. 1960, proposing to nationalize the said route and published the same in the Gazette on July 23, 1960. The petitioners filed objections against the scheme and the said objections were heard by the Joint Secretary, Judicial Department, and the scheme was finally approved by him. The approved scheme was notified in the Gazette on May 20, 1961. Under the said notification, the State Transport Undertaking would commence to operate its stage carriage service on the said route from July 15, 1961 or thereabout. Aggrieved by the said scheme, the petitioners filed the said petition for writs in this Court for reliefs similar to those in the other petition. Mr. Kacker, learned counsel for the petitioner in Writ Petition No. 205 of 1961, raised the following points: (1) Under section 68C of the , the State Transport Undertaking has to form its opinion and prepare a scheme for nationalisation and publish it in the manner prescribed thereunder, but in the present cases the State Government initiated the schemes and, therefore, the schemes were not validly made; (2) As neither the objection to the proposed scheme were heard nor were they approved by the State Government as they should be under section 68D of the , the schemes were invalid; (3) The Regional Transport Authority acted illegally in curtailing the period of renewal this question arises only in the appeal; (4) The Regional Transport Authority had not applied its mind in dealing with the renewal application but mechanically followed the provisions in the proposed schemes and, therefore, its order was bad; (5) Even after the approval of the nationalisation schemes, the State owned buses were required to apply for and get permits under the Act and plying of buses 83 by the State without permits was illegal; and (6) The Secretary to the Regional Transport Authority had no jurisdiction to issue an order under section 68F (2) of the , since under the said section only the Regional Transport Authority had the power to do so this question arises only in Writ Petition No. 205 of 1961. To appreciate the first argument it is necessary to notice briefly the relevant provisions of Ch. IVA of the (IV of 1939) hereinafter called the Act. Section 68A(b) defines "State transport undertaking" to mean "any undertaking providing road transport service, where such undertaking is carried on by (i) the Central Government or a State Government. Section 68C reads: "Where any State transport undertaking is of opinion that for the purpose of providing an efficient, adequate, economical and properly coordinated road transport service, it is necessary in the public interest that road transport services in general or any particular class of such service in relation to any area or route or portion thereof should be run and operated by the State transport undertaking, whether to the exclusion, complete or partial, of other persons or otherwise, the State transport undertaking may prepare a scheme giving particulars of the nature of the services proposed to be rendered, the area or route proposed to be covered and such other particulars respecting thereto as may be prescribed and shall cause every such scheme to be published in the Official Gazette and also in such other manner as the State Government may direct". Section 68D reads: "(1) Any person affected by the scheme published under section 68C may, within 84 thirty days from the date of the publication of the scheme in the Official Gazette, file objections thereto before the State Government. (2) The State Government may, after considering the objections and after giving an opportunity to the objector or his representatives and the representatives of the State Transport undertaking to be heard in the matter, if they so desire, approve or modify the scheme." Section 68E provides for the cancellation or modification of the scheme by the State transport undertaking and in that event the same procedure prescribed for framing a scheme is to be followed. The effect of the said provisions, in so far as they are relevant to the present inquiry, may be stated thus: The State transport undertaking is an undertaking providing road transport service which is carried on by the State or any other corporation or authority mentioned in section 68A. The definition creates a statutory authority distinct from authorities which run it. This is made clear by section 68C whereunder it is the State transport undertaking that will have to form the requisite opinion. This is further elucidated by the fact that under section 68C of the Act the state transport undertaking is required to publish the proposed scheme in the Official Gazette and also in such other manner as the State Government may direct. This distinction between the two entities is further made clear by section 68D(2) whereunder the State Government has to hear the representatives of the State Transport undertaking. Briefly stated, under the said provisions, a statutory authority called the State transport undertaking is created it is authorised to initiate a scheme of nationlisation of road transport, the aggrieved parties are given opportunity to file objections thereto, and 85 the State Government is empowered to hear both the parties and approve or modify the scheme, as the case may be. Counsel for the appellant contends that the underlying scheme of the Act cannot be worked out unless a clear distinction is maintained between the State transport undertaking and the State Government, for, if one is equated with the other, the State Government would become a judge of its own cause, and that, therefore, it was incumbent upon the Government to form a separate and distinct, authority to enable it to initiate a scheme in accordance with law. Counsel for the State contends that a transport undertaking run by a State Government is a State transport undertaking and, therefore, the scheme initiated by the State Government which runs the State undertaking is a scheme initiated by the said undertaking. It is true that the provisions maintain a distinction between a State transport undertaking and the State Government. It is also true that the State Government has to hear the objections of the aggrieved parties and also the representatives of the State transport undertaking before approving or modifying the scheme, indicating thereby that the State Government has to decide the dispute that may arise between the two contestants. Though the functions of the different bodies are clearly demarcated in the case of undertakings run by corporations, there is overlapping in the case of an undertaking run by a State Government. This may lead to anomalous position, but in practice it can be avoided, if the State Government creates a department to be in charge of the undertaking and hears the objections and approves or modifies the scheme in a manner without violating the principles of natural justice. 86 A State transport undertaking means, inter alia, an undertaking run by a State. The statutory authority created is an undertaking run by a State. The State can only run an undertaking through its officers; it may entrust the conduct of the transport service to a particular officer or to a department of the State; in either event, it is the State Government that runs the undertaking. The statutory authority, namely, the State transport undertaking, has to form an opinion within the meaning of section 68C of the Act, and the opinion must necessarily be that of the State Government which runs it. If the State Government running an undertaking forms an opinion, it can legitimately be said that the statutory authority i. e., the State transport undertaking, has formed the opinion. In Gullapalli Nageswara Rao vs Andhra Pradesh State Road Transport Corporation (1) before the State of Andhra was formed in November, 1956, the Motor Vehicles (Hyderabad Amendment) Act, 1956 was in force in Telengana area. Under the said Act the State transport undertaking was defined to mean the road transport department of the State providing road service. After the Andhra Pradesh State was formed, that department initiated the scheme and this Court held that the said department clearly fell within the definition of state transport undertaking. This Court observed in that case: "The State Government maintained the department for providing road transport service and therefore the department clearly falls within the definition of State Transport Undertaking. " If a state directly runs an undertaking, it can only be through a department. In law there cannot be any difference between an undertaking run by a department of a State Government and that run 87 by the State Government. In either undertaking is run by the State and that undertaking is a State transport undertaking within the meaning of section 68C of the Act. The opinion must necessarily be formed by somebody to whom, under the rules of business, the conduct of the business is entrusted and that opinion, in law, will be the opinion of the State Government. It is stated in the counter affidavit that all the concerned officials in the Department of Transport considered the draft scheme and the said scheme was finally approved by the Secretary of the Transport Department before the notification was issued. It is not denied that the Secretary of the said Department has power under the rules of business to act for the State Government in that behalf. We, therefore, hold that in the present case the opinion was formed by the State transport undertaking within the meaning of section 68C of the Act, and that there was nothing illegal in the manner of initiation of the said scheme. The second ground urged by counsel for the appellant that the scheme was invalid because the objections to the scheme were heard and the scheme was approved by the Joint Secretary, Judicial Department, who was not lawfully invested with authority in that behalf is for reasons to be presently stated not open to the appellant. By the first sub section of section 68D which we have already set out persons affected by a transport scheme are entitled to file objections thereto. By sub section (2), the State Government is authorised to approve or modify, the scheme after considering the objections, if any, and after giving an opportunity of being heard in the matter to the objector or his representatives and the representatives of the State transport undertaking. Sub section (3) provides for the publication of the 88 approved or modified scheme in the Official Gazette by the State Government and on such publication the scheme becomes final. It must at once be observed that neither in the petition under article 226 of the Constitution to the High Court, out of which Civil Appeal No. 325 of 1961 arises, nor in the Writ Petition under article 32 (No. 205 of 1961) presented to this Court, was the plea raised that the Joint Secretary to the Judicial Department was not authorised to hear the objection and to approve the scheme. In the petition (No. 205 of 1961) under article 32 of the Constitution it was averred by the petitioner in para 10 that "the petitioner filed objections under section 68D(1) of the Act, against the scheme of the State Government, and it also heard its own representatives in opposition to the petition" and again it was averred in the same paragraph "at the time of hearing of the petitioner 's objections under section 68 D, Before the State Government it was argued on behalf of the petitioner that the aforesaid scheme was bad. " In the petition under article 226 of the Constitution it was averred in paragraph 25 "That no State Transport Undertaking having been constituted the State Government initiated the scheme and heard its own representatives on 13.8.1960. The petitioner has bonafide belief that the Joint Secretary to the Government of Uttar Pradesh (Judicial Department) who heard the objections acted with bias against the petitioner. " Even in the petition for special leave to appeal to this Court, no such objection was raised. There is also no reference to any such contention in the judgment of the High Court. The validity of the scheme on this ground is sought to be raised for the first time in this Court, and, according to the settled practice of this Court the appellant except in exceptional circumstances and there are none such in this case is not entitled to raise this argument for the first time at the hearing in this Court. It was urged in the course of the 89 argument that by Rule 7 of the State Land Transport Services Development Rules 1958, which at the material time read as follows: "(1) The objections received shall be considered by the judicial Secretary to Government of U.P. or an officer of his department, not below the rank of Joint Secretary nominated by the former for the purpose. x x x x x x x x x x (5) After hearing of such parties as appear, the officer shall give a decision whether the scheme be approved or modified as he may deem proper", no authority was lawfully conferred upon the Joint Secretary, and the proceedings of the Joint Secretary in purported exercise of powers under section 68D (2) were without jurisdiction. But this is another facet of the same argument, and it is clear from a perusal of the petitions before the High Court and this Court and the judgment of the High Court that it was never raised. There is no doubt that the scheme has been duly published under section 68D(3) and if the objection to the invalidity of the scheme on the ground that the objection were not heard by an authority competent in that behalf cannot be permitted to be raised in this Court for the first time during the course of the arguments, the statutory consequences prescribed by section 68F must ensue. It is necessary to bear certain facts and considerations in mind in dealing with the remaining contentions. By the scheme (cl. 7) the permit of the appellant was cancelled. The scheme as approved was published in the U.P. Gazette on October 8, 1960, and was to come into operation on October 15, 1960, or thereafter. A notification was published on November 4, 1960, under section 68F(2) 90 of the Act cancelling the appellant 's permit with effect from November 27, 1960. The appellant therefore ceased to have any right to ply his vehicles on the route and he had no right to object to the vehicles of the State transport undertaking plying on that route. If the scheme was validly promulgated and became final within the meaning of section 68D(3), it had the effect of extinguishing all rights of the appellant to ply his vehicles under his permit. After cancellation of his permit, he could not maintain a petition for writ under article 226 because a right to maintain such a petition postulates a subsisting personal right in the claim which the petitioner makes and in the protection of which he is personally interested. It is true that the appellant did at the date of the petition filed in the High Court hold a permit which was to enure till the 27th November, 1960. But if the permit was validly terminated from the date specified, he will not be entitled to relief even if he had on the date of the petition a subsisting right. Ground No. 2 must therefore fail. Grounds 3 and 4 of the appellant that the Regional Transport Authority acted illegally in curtailing the period of renewal and that, in any event, it did not apply its mind in dealing with the renewal application but mechanically followed the provisions of the scheme may now be considered. The Regional Transport Authority was by the terms of the scheme left no discretion in the matter. It was by the scheme that the right of the appellant was restricted and if the scheme became final and binding the Regional Transport Authority had no authority to permit the appellant to ply his vehicles. The order passed by the Regional Transport Authority was purely consequential on the scheme, and if the scheme is not open to challenge, orders consequential thereon will not 91 also be open to challenge. We are supported in this view by the observations of this Court in Abdul Gafoor: Proprietor, Shaheen Motor Service vs The State of Mysore (1) that: "It appears to us that when deciding what action to take under section 68F(1) the authority is tied down by the terms and conditions of the approved scheme and his duty is merely to do what is necessary to give effect to the provisions of the schemes. The refusal to entertain applications for renewal of permits or cancellation of permits or modification of terms of existing permits really flow from the scheme. The duty is therefore merely mechanical and it will be incorrect to say that there is in these matters any lie between the existing operators and the State Transport Authority. There is no justification therefore for saying that when taking action under section 68F(2) is really independent of the issue of the permits under section 68F(1). Once the scheme has been approved, action under section 68F(1) flows from it and at the same time action under section 68F(2) flows from the same scheme". We are bound by the decision. We are not called upon to consider whether the State owned buses are being validly plied without obtaining permits under section 68F(1) of the Act. If the right of the appellant to ply his buses is lawfully extinguished, he is not entitled to maintain an appeal challenging the right of the State Transport undertaking to ply their buses with or without permits. Nor is any fundamental right of the appellant infringed by the State Transport undertaking plying its buses without permits, and a petition under article 32 of the Constitution cannot be maintained unless a fundamental right of the applicant is infringed. 92 Nor is there any substance in the last contention. The orders passed under. sections 68F(2)(a) and (b) flow from the publication of the scheme duly approved and the issue of an order, which is not quasi judicial but administrative, by the Secretary on behalf of the Regional Transport Authority is not open to challenge. It is not the case of the Petitioner in W. P. 209/61 in which alone this contention is raised that the order unauthorised. what is contended above this contention is raised that the order is being quasi judicial, power to make it cannot be delegated. But for reasons already set out the order is not quasi judicial; it is purely administrative. In our view, therefore, the appeal and the petitions must fail, and are dismissed with costs.

The appellant, whose permit for plying stage carriage was shortly to expire, applied for its renewal. The renewal application was published in the Gazette calling for objections. The State Government published a notification proposing to nationalise the route. The permit was renewed for three years for a part of the route but an endorsement was made thereon authorising the appellant to ply on the remaining part of the route for four months. The appellants filed objections to the proposed scheme for nationalisation. The objections were heard by the Joint Secretary, Judicial Department, who approved the scheme with certain modifications. The scheme was published in the Gazette. Thereafter, a notification was issued under section 68F of the cancelling the appellant 's renewed permit. Under the Scheme the stage carriages of the State Transport Undertaking could ply on the route without obtaining permits. The appellant challenged the validity of the scheme and the cancellation of his licence. ^ Held, that the scheme was valid and the appellant 's licence was properly cancelled. Section 68C of the required the scheme to be initiated by the State Transport Undertaking. Even though the scheme in the present case was actually initiated by the State Government there was no non compliance with the provisions of section 68C. There was no difference between an undertaking run by a department of the State Government and that run by the State Government. In either case the undertaking was run by the State and it was a State transport undertaking within the meaning of section 68C. Initiation of the scheme by the State Government running an undertaking was initiation by the statutory authority i.e., the State Transport undertaking. The appellant could not be allowed to challenge the validity of the scheme on the ground that the Joint Secretary was not lawfully invested with the authority to hear objections and to approve the scheme as the point was not raised at the proper stage. 77 Gullapalli Nageswara Rao vs Andhra Pradesh State Road Transport Corporation, [1959] Supp. 1 S.C.R. 319, applied. The scheme having been validly promulgated and having become final under section 68D(3) it had the effect of extinguishing all rights of the appellant to ply his stage carriage under his permit and he could not maintain a petition under article 226 of the Constitution. The order passed by the Regional Transport Authority cancelling the appellant 's permit was purely consequential on the scheme and could not be challenged if the scheme was valid. Once the right of the appellant to ply his stage carriage was validly extinguished he could not question the right of the State transport authority to ply their stage carriages with or without permits. Abdul Gafoor, Proprietor, Shaheen Motor Service vs State of Mysore, ; , applied.

Civil Appeal No. 9 of 61. Appeal from the judgment and order dated May 7, 1959, of the Punjab High Court in L.P.A. No. 86 of 1956. M.C. Setalvad, Attorney General of India, S.N. Andley, Rameshwar Nath and P.L. Vohra, for the appellants. section M. Sikri, Advocate General, Punjab, B.K. Khanna and P.D. Menon, for the respondents. 915 1961. December, 5. The Judgment of Sinha C.J., Hidayatullah, Shah and Mudholkar JJ., was delivered by Hidayatullah, J. Kapur, J., delivered a separate judgment. HIDAYATULLAH, J. The appellants are a firm of general merchants which sells, among other goods manufactured tobacco as defined in the Punjab Tobacco Vend Fees Act, 1954 (12 of 1954), which came into force in the State of Punjab from April 1, 1954. The firm is also a registered dealer under section 7 of the East Punjab General Sales Tax Act, 1948 and till the end of March, 1954, was paying sales tax on manufactured tobacco also. Indeed, the firm paid sales tax on manufactured tobacco, also for the next quarter ending on June 30, 1954, but did not pay in the succeeding quarter in view of certain events, to which a detailed reference will be made presently. On September 27, 1954, the State Government issued a Notification (No. 4556 E & T (Ch) 54/957) by which the schedule of exemptions under section 6 of the Sales Tax Act was amended by the inclusion of item 51, which reads as follows: "51. Manufactured tobacco as defined in the Punjab Tobacco Vend Fees Act, 1954. " This Notification was preceded by a Notification of May 7, 1954 (No. 427 E & T (Ch) 54/369), by which the State Government had given notice, as required by law, of its intention to add the said item in the schedule of exemptions. In June, 1954, the State Government issued a Press Note by which it was intended to convey to the dealers that though the Tobacco Vend Fees Act had come into force from April 1, 1954, it was not intended to levy both the sales tax as well as the fee for any period. The Press Note reads as follows: "There is some misapprehension in the minds of dealers in manufactured tobacco as to whether sales tax is also chargeable in respect of manufactured tobacco after the 916 1st April, 1954, in addition to the license fees under the Tobacco Vend Fees Act. Government would like to make it clear that although the Tobacco Vend Fees Act has come into force with effect from 1st April, 1954, no license fees for dealers have yet been prescribed under the Act. Therefore, the levy of sales tax continues till the Vend Fee licences come into operation. It is to be clearly understood that the Vend Fee will be proportionately reduced for the current financial year to adjust the period for which sales tax will have been charged. Manufactured tobacco will be exempted from sales tax simultaneously with the enforcement of the Vend Fees." On August 2, 1954, the State Government issued another Press Note, in which the decision was altered. The Press Note said: "Government recently announced through a press note that the levy of Sales Tax on manufactured tobacco would be continued till the Vend Fee Licences came into operation and that the Vend Fee would be proportionately reduced for the current financial year in respect of the period for which Sales Tax would have been charged. In order to avoid double taxation, Government have since reconsidered the matter and have, in supersession of the previous decision, decided that the Sales Tax, if any, recovered from the dealers would be refunded and that no Sales Tax would be charged during the current financial year in respect of sales of tobacco which fall under the Tobacco Vend Fees Act. Tobacco Vend Fees will be recovered at full rates for the whole year as and when rules under the Punjab Tobacco Vend Fees Act are finalised. " It appears that the Rules under the Tobacco Vend Fees Act were not promulgated; nor were the forms 917 and licences prescribed during the financial year ending on March 31, 1955. In the meantime, the appellants, as already stated, paid sales tax on sales of manufactured tobacco for the first quarter ending June 30, 1954, and the Notification exempting manufactured tobacco from sales tax was issued on September 27, 1954. The appellants had made enquiries from the Excise and Taxation Commissioner, Punjab, about the Press Note of August 2, 1954, and had been assured that the Notification as printed in the Newspapers was accurate, and that Government intended implementing the Press Note. On January 23, 1956, the appellants received a notice from the Excise and Taxation Officer, Rohtak, calling upon them to produce their account books. The appellants as well as other dealers of manufactured tobacco similarly affected, made representations on the basis of the Press Note of August 2, 1954, but without success. The appellants then filed on February 8, 1956 a petition under article 226 of the Constitution for substantially three reliefs. They were: (a) a declaration that the levy of sales tax on manufactured tobacco upto September 26, 1954 was illegal; (b) refund of the sales tax paid by it for the quarter ending June 30, 1954; and (c) an order in the nature of a writ of Prohibition against the proposed levy of sales tax till September 26, 1954. It remains to mention that the sales tax authorities were acting in conformity with a Press Note issued in August, 1955, by which the State Government went back upon the policy declared in August, 1954 and reaffirmed the policy stated in the Press Note of June, 1954. The following extract from the Press Note of August, 1955 may be read here: "2. In conformity with the press note issued in June, 1954, and in view of the facts explained above, Government have now decided that sales tax on tobacco shall be levied for the year 1954 55 before the 27th September, 1954 918 only, the date on which tobacco was included in the schedule of exemptions appended to the General Sales Tax Act. This amounts to a handsome concession to the dealers and Government except that, in return, every cooperation shall be shown by the dealers of the assessing authorities in the matter of the assessment of the tax. " The petition under article 226 was heard by a learned Single Judge of the Punjab High Court, who held that the orders of Government were entirely in accordance with law, that the East Punjab Sales Tax Act, in so far as it related to the sale of manufactured tobacco was not repealed by the Tobacco Vend Fees Act, and that sales tax on manufactured tobacco was payable from April 1, 1954 to September 26, 1954, in view of the fact that the exemption was made on September 27, 1954, and would operate from the latter date. Against the decision of the learned Judge dismissing the writ petition, an appeal under Letters Patent was filed. The Divisional Bench, which heard the appeal, agreed with the judgment appealed from, and dismissed the appeal. A certificate was, however, granted to the appellants and the present appeal has been filed. Two contentions were raised in the forefront before the High Court, by the appellants. The first was that the Punjab Tobacco Vend Fees Act had pro tanto repealed the East Punjab General Sales Tax Act, and that sales tax on manufactured tobacco could not be levied after April 1, 1954. The second was that the State Government by its assurance in the Press Note of August, 1954, had estopped itself from reversing its policy and claming the sales tax up to the date of the Notification. These points were not seriously pressed upon us, because there can be two taxes on the same commodity or goods without the one law repealing the other. No repeal can be implied, unless there 919 is an express repeal of an earlier Act by the later Act, or unless the two Acts cannot stand together. The first argument was, therefore, rightly rejected in the High Court. The second argument is also without force. There can be no estoppel against a statute. If the law requires that a certain tax be collected, it cannot be given up, and any assurance that it would not be collected, would not bind the State Government, whenever it choose to collect it. The question which is now raised, and of which there is but a trace in the High Court is the real one to decide, and it may be formulated thus; Did the exemption in the Notification issued on September 27, 1954 have effect from that date, or from the beginning of the financial year ? We are not concerned with the question whether, in the absence of rules and forms, the Punjab Tobacco Vend Fees Act, 1954 could operate from April 1, 1954. Whether it did or did not, can make no difference to the sale tax, because the Punjab Tobacco Vend Fees Act, 1954 did not abrogate the Sales Tax Act. If sales Tax was not payable, it would be because of the exemption, and the only question thus is when the exemption began to operate. The Notification does not say from what date the exemption operates. Taking the Notification by itself, it cannot be said that it comes into force from an earlier date. Both sides have thus called in aid provisions of the East Punjab General Sales Tax Act and the Rules to determine the date from which the exemption can be said to operate. Reference was made by the appellants to a decision of this Court in The Commissioner of Sales Tax, U.P. vs The Modi Sugar Mills Ltd.(1), where a notification increasing sales tax on edible oils issued in the middle of the year 1948 was held not to apply to the assessee in that year, inasmuch as its liability to tax had become fixed on April 1, earlier, as it had elected to pay tax on the turnover of the previous 920 year. The scheme of taxation under the U.P. Sales Tax Act, 1948 (15 of 1948) and the Rules under that Act is so vastly different from the East Punjab General Sales Tax Act and the Rules under it, that a detailed reference to that case may not be necessary. The question thus must be viewed in the setting of the East Punjab Sales Tax Act and the Rules under it. We shall refer to them shortly as the Act and the Rules in the rest of this judgment. The Act was passed in 1948, and came into force on November 15, 1948. Previous to this, sometimes licence fee under an earlier Tobacco Vend Fees Act and sometimes sales tax also under an earlier Sales Tax Act had been levied but not side by side in the Province. The history of these earlier Acts was brought to our notice during the course of the argument, but nothing turns upon it. The sales tax under the Act continued to be levied up to April 1, 1954, and none has disputed that it could be levied. On that date, the Punjab Tobacco Vend Fees Act came into force. We have already said that the latter Act did not repeal pro tanto the earlier. The liability for sales tax in this appeal is for two quarters ending June 30, 1954, and September 30, 1954. There is no dispute that after September 27, 1954 sales tax could not be levied, in view of the inclusion of item 51 in the schedule exempting manufactured tobacco from the operation of the Act. We must now examine those provisions of the Act which are claimed by the rival parties to indicate the moment of time from which the exemption granted by the Notification began to operate. "Turnover" has been defined in the Act to include the aggregate of the amounts of sales and parts of sales actually made by any dealer during the given period, less certain allowances, and "year" means the financial year. Sections 4 and 5 read together are the charging sections, the first dealing with the incidence of the tax, and the second, with its rate. Section 6 (1) provides for exemptions on the sale of 921 goods which are specified in schedule to the Act. Under section 6 (2), the State Government has been given the power to add to or delete from that schedule. Section 10 deals with the making of returns and payment of the tax. Section 27 empowers the State Government to make rules for carrying out the purposes of the Act. This is the general scheme of the Act, in so far as we are concerned; but a somewhat detailed examination of these sections is necessary to understand the rival contentions. Section 4 consists of five sub sections. Sub Section (1), which is a subject to the provisions of sections 5 and 6, says that every dealer, except one dealing exclusively in goods declared tax free under section 6, whose gross turnover during the year immediately preceding the commencement of the Act exceeded the taxable quantum, shall be liable to pay tax under the Act on all sales effected after the coming into force of this Act. A proviso is added, which is not relevant. Sub section (2) says that every dealer who is liable to pay tax under the first sub section shall be liable to pay it on the expiry of 30 days after the date on which his gross turnover first exceeds the taxable quantum. Sub sections (3) and (4) deal with the continuance of the liability of the dealer under certain circumstances, and are not relevant here. Sub section (5) then defines "taxable quantum" in relation to different kinds of dealers, and fixes a certain amount as the lowest limit. Since, in the present case, the taxable quantum is above the limit applicable to the appellants and they are also admittedly dealers, a detailed reference to the provisions of sub section (5) is unnecessary. Section 5, which deals with the rate of tax, is made subject to the other provisions of the Act, and the first sub section says that there shall be levied on the taxable turnover every year of a dealer a tax at such rates (not exceeding two pice in a rupee) as the State Government may by notification direct. "Taxable turnover" 922 is then defined by the second sub section to mean that part of a dealer 's gross turnover during any period which remains after deducting therefrom, inter alia his turnover during that period of tax free sales, sales to registered dealers, sales to any undertaking supplying electrical energy, sales to dealers outside Punjab and other sales, as may be prescribed. With none of these deductions we are concerned in this case. Now, the appellants emphasise the words "gross turnover during the year" in s.4 (1) and the words "taxable turnover every year of a dealer" in section 5 (1), and argue that the tax is computed year wise, and the exemption must, therefore, operate for the whole of the year in which it is made, irrespective of the date on which the Notification is made. The respondents, on the other hand, emphasise the words "gross turnover during any period" and "his turnover during that period" occurring in section 5, and contend that the tax is not year wise but accrues, so to speak, from day to day or at least from period to period within a year, and the exemption thus operates not from the whole of the year, but for the period within which it is granted, and refer in aid of this argument, to sections 6 and 10. Sections 4 (1) and 5 (1) are subject to section 6, section 5 (1), to other sections of the Act and so, section 10, and we have to see what they provide. Section 6 (1) is brief, and may be quoted in extenso. It reads: "6 (1). No tax shall be payable under this Act on the sale of goods specified in the first column of the Schedule, subject to the conditions and exceptions, if any, set out in the corresponding entry in the second column there of and no dealer shall charge Sales Tax on the sale of goods which are declared tax free from time to time under this section. " The respondents emphasise the words "from time to time" in the first sub section, and say that 923 they also show that exemptions may be given, withdrawn, or given again and again several times during the year in respect of the same goods, and the exemptions, therefore, begin to operate when they are given and cease, when they are withdrawn. But, the appellants contend that these words merely indicate that the power may be exercised as often as needed, and do not indicate the time from which the operation of the exemption commences and the period during which it lasts. Section 10 (1) provides that the tax payable under the Act shall be paid in the manner provided at such intervals, as may be prescribed. Two Rules framed under section 27 provide for such intervals. Rule 20 reads: "Every registered dealer other than those referred to in rules 17, 18 and 19, shall furnish returns in Form S.T.VIII or S.T. XXIII, if so permitted quarterly within thirty days from the expiry of each quarter." (words underlined were introduced on June 28, 1955). Rule 23: "Notwithstanding the provisions of rules 20 and 21, the appropriate Assessing Authority may, for reasons to be recorded in writing, fix monthly returns for a dealer, who would otherwise be required to furnish quarterly or annually under these rules. " Section 10 and Rules 20 and 23 clearly provide that returns may be made annually, quarterly or monthly. The forms, section T. VIII and S.T. XXIII, also are forms of returns of sales tax payable for the year, quarterly or monthly. It is thus possible that some dealers pay tax annually some, quarterly, and some, monthly. The contention of the appellants is that s.10 read with Rules 20 and 23 merely provides for making of returns at prescribed intervals and the 924 collection of tax is for a period falling between those intervals, but the tax is the tax appropriate to the whole year 's result. The respondents contend that the effect of the section and the two Rules is that the tax due for the period of the return is separate from any other tax for any other period. Each period, according to them, must be viewed separately and not as part of a year. Thus, if exemption is granted during the second quarter, according to the respondents it affects that quarter and subsequent quarters but not the first quarter, because tax is payable on the turnover of a period and at such intervals, as may be applicable to an assessee. We cannot help saying that the Act and the Notification could have been framed to obviate such unnecessary questions by providing clearly in them the time from which such exemptions would begin to operate. Similarly, if the rules under the Punjab Tobacco Vend Fees Act had been framed in time and the Tobacco Vend Fees Act together with the Rules under it and the exemptions under the Sales Tax Act were brought into force together, a considerable amount of time to the Department and the Courts would have been saved, as also trouble to the tax payer. The Rules under the Punjab Tobacco Vend Fees Act were not framed during the whole of the financial year, 1954 55. Contradictory Press Notes were issued, which showed that the State Government itself was not sure of the true legal position, thus causing great confusion and distrust in the minds of the tax payers. There is no doubt that the tax is a yearly tax. It was payable, in the first instance, by a dealer whose gross turnover during the financial year immediately preceding May 1, 1949, was above the taxable quantum. The tax is to be levied on the taxable turnover of a dealer every year. The difference between gross turnover and taxable turnover is this, that to arrive at the taxable turnover of 925 any period some deductions have to be made for the same period. This clearly shows that the tax is for a year. The method of collection allows collection of tax at intervals; in some cases, the tax is collected at the end of the year; in some others, the tax is collected quarterly and in still other cases, even monthly. If the exemption can be said to operate for that period for which the tax is payable according as it is annually, quarterly or monthly, the tax would be different for different persons. Those who are paying the tax annually would get exemption for the whole year; but those who are paying it quarterly or monthly would get benefit in the quarter or the month of the Notification but not for earlier quarters or months. It could not have been intended that the exemption was to operate differently in the case of dealers with different intervals of assessment. The exemption thus must operate either from the date of the Notification or from the commencement of the financial year. Here, the nature of the tax, as disclosed in sections 4 and 5, is decisive. In section (5), the tax is made leviable "on the taxable turnover every year of a dealer". The divisions of the year and the taxable turnover into different parts are to make easy the collection of tax, and form part of the machinery sections. If the tax is yearly and is to be paid on the taxable turnover of a dealer, then the exemption, whenever it comes in, in the year for which the tax is payable, would exempt sales of those goods throughout the year, unless the Act said that the Notification was not to have this effect, or the Notification fixed the date for the commencement of the exemption. In the present case, the Notification did not fix the date from which the exemption was to operate, probably because the Act omitted to make such provision, enabling the State to do so, and the exemption must, therefore, operate for the whole year, during which it was granted. 926 The case of this Court, to which we have referred earlier, dealt with an Act under which the taxpayer could elect to pay the tax on the turnover of either the previous year or the year of assessment. A notification in the middle of the assessment year was considered, and was held inapplicable in those cases where a dealer had elected to pay tax on the turnover of his previous year. The majority view on that occasion pointed out that it was not possible to divide the assessment year in two portions, in which the tax was levied at one rate in one part and another rate in another part. The case was confined to a dealer who had elected to pay the tax for a year different from that in which the exemption was granted. Those facts do not exist here; but if the case is considered at all relevant, it supports the appellants rather than the respondents. In the result, the appeal succeeds, and is allowed with costs. KAPUR, J. The facts of this case have been set out in the judgment of my learned brother Hidayatullah J., which I have had the advantage of reading and as I am unable to agree with the conclusion that the effect of the exemption given by Notification No. 34556 E & T. (CH)54/957 dated September 27, 1954, issued under s.6(2) of the Punjab General Sales Tax Act (Act 16 of 1948), hereinafter called the "Act", on unmanufactured tobacco becomes effective as from the beginning of the financial year, I proceed to give my reasons for the same. The period in regard to which the disputed amount of sales tax is sought to be levied was from April. 1, 1954 to September 27, 1954. Previous to the issuing of the notification of September 27, 1954, the Punjab Government issued a notification required under s.6(2) of the Act for the purpose of information of persons likely to be affected thereby 927 and to give them an opportunity to file any objections or suggestions in regard to the same. A press note was issued on August 4, 1954 stating that no sales tax will be leviable on manufactured tobacco for the financial year 1954 55. In order to resolve the controversy as to whether the exemption is effective from the commencement of the financial year or from the date of the notification it is necessary to refer to the scheme of the Act and the rules made thereunder. The East Punjab General Sales Tax Act (Act 46 of 1948) as amended, made provision for the levy of general sales tax on the sale of goods in the Punjab and repealed the General Sales Tax Act of 1941. Section 2 of the Act gives definitions and cl.(d) defines a "dealer" as a person. engaged in the business of selling or supplying goods. In cl.(i) "Turnover" was defined to include "the aggregate of the amount of a sale and parts of the sale actually made by any dealer during the given period less any sum allowed as cash discount according to ordinary trade practice. " Sections 4 and 5 are the charging sections, the former makes the tax leviable prospectively and the latter prescribes the rate of tax. The relevant portions of these sections when quoted are as follows: S.4(1) "Subject to the provisions of sections 5 and 6, every dealer except one dealing exclusively in goods declared tax free under section 6 whose gross turnover during the year immediately preceding the commencement of this Act exceeded the taxable quantum shall be liable to pay tax under this Act on all sales effected after the coming into force of this Act. (2) Every dealer to whom sub section (1) does not apply or who does not deal exclusively in 928 goods declared to be tax free under section 6 shall be liable to pay tax under this Act on the expiry of 30 days after the date which his gross turnover first exceeds the taxable quantum." "Taxable quantum" mentioned in sub section (2) is defined in sub section (5) of section 4. Thus a dealer is liable to sales tax if his sales in the year preceding the commencement of the Act are more than the taxable quantum (section 4.(1) or subsequently becomes so during any year. section 5.(1) "Subject to the provisions of this Act, there shall be levied on the taxable turnover every year of a dealer a tax at such rates not exceeding two pice in a rupee as the State Government may by notification direct: Provided that Government may by notification in the Official Gazette declare that in respect of any goods or class of goods the dealer may pay such lump sum by way of composition of the tax payable under this Act as the Government may notify from time to time. (2) In this Act the expression "taxable turnover" means that part of a dealer 's gross turnover during any period which remains after deducting therefrom. (a) his turnover during that period on (i) the sale of goods declared tax free under section 6; (ii). . . . . . (iii). . . . . " Section 6 which makes provision for giving exemption is as follows: S.6(1) "No tax shall be payable under this act on the sale of goods specified in the first column 929 of the Schedule subject to the conditions and exceptions, if any, set out in the corresponding entry in the second column thereof, and no dealer shall charge Sales Tax on the sale of goods which are declared tax free from time to time under this section. (2) The State Government, after giving by notification not less than three months ' notice of its intention so to do, may by like notification add to or delete from the Schedule and thereupon the Schedule shall be deemed to be amended accordingly. " Section 10 deals with payment of taxes of returns. Clause (1) of section 10 provides: S.10 (1) "Tax payable under this Act shall be paid in the manner hereinafter provided at such intervals as may be prescribed. " Section 11 is the section dealing with assessments. It provides that if the Assessing Authority is satisfied that the returns furnished are correct and complete he shall assess the amount of tax due and if he is not so satisfied he can require the production of evidence which may be necessary and provision is also made for default in carrying out the notice issued. Section 27 gives the Government the power to make rules. The relevant portions of this section are clauses (h) and (i) which were as follows: (h) "the return to be furnished under sub section (3) of section 10, and dates by which and the authority to which, such returns shall be furnished; (i) the date by which returns for any period are to be furnished and the procedure to be followed for assessment under section 11." Under the rule making power rules have been framed by the Punjab Government and reference may be made to Rules 20 and 23. Under the 930 former rule every registered dealer is required to furnish returns in Form ST VIII or ST XXIII if so permitted quarterly within thirty days from the expiry of each quarter. Under the latter the Assessing Authority is given the power to tax the returns to be made monthly in the case of a dealer who would otherwise be required to furnish them quarterly or annually. It was argued that the tax under s.5 was a yearly tax and therefore whenever the exemption may be given during a financial year the effect of the exemption will become operative as from the beginning of the financial year and emphasis was laid on the words "there shall be levied on the taxable turnover every year of a dealer a tax. " The argument was that it was a yearly tax on the turnover and not that every year a tax was to be levied on the taxable turnover i.e. aggregate of the sales made during a given period. It was also argued that if the exemption of the turnover was to operate for the quarter in which the exemption was notified, the consequence will be absurd as those who pay the tax on quarterly returns or monthly returns will not be able to get the advantage of the exemption whereas those who pay on yearly returns will be so entitled. I am unable to agree that the effect of the collection of the words in section 5 and particularly of the words "shall be levied on the taxable turnover every year. a tax" is what was argued by the appellants i.e. it was a yearly tax like the income tax. Section 6 which provides for exemption specifically envisages the declaration from time to time of exemption of goods which are to be tax free. The use of the words "tax free from time to time", in my opinion, means that the exemption may be given at any time during the year but it does not suggest that the exemption will operate from the beginning of the year and not from the time that the exemption is given. If this were not so the the imposition of sales tax by excluding an 931 article exempt from tax from the schedule say about the end of the financial year would render the dealer liable to sales tax for the whole year even though he may not have collected any sales tax from his customers which under the law he would be entitled to do if the article is not in the schedule. It will be an imposition which is not envisaged by the general scheme of the Sales Tax Act because the tax is exigible on taxable turnover in every return made monthly or quarterly or yearly as the case may be. It appears that it is for that reason that in the definition of the word "turnover" the legislature has chosen the word "during the given period" i.e. the period for which the tax is leviable and is levied. Similarly in subsection (2) of section 5 where sales tax is levied on the taxable turnover of a dealer the use of the word "during any period" is again repeated and in cl.(a) of that section reference is made to deduction from his turnover during that period of the sale of goods declared tax free under section 6 and that is for a good reason because section 6 itself mentions the declaration of tax free goods from time to time indicating that whenever during the year or at any time during the year when goods are notified to be tax free. That the intention of the legislature was to give exemption from the date of the notification or such date as is mentioned in the notification is further supported by the provisions of sections 10 and 11 of the Act. Under section 10 a dealer may be required to furnish his return at such intervals as may be prescribed and when he makes a return it must necessarily be of the goods on which during that period sales tax was exigible. Under sub s.(4) of s.10 the dealer is required to pay into the Government treasury the full amount of tax according to his return. Under section 11 the assessment of the tax either on the acceptance of the return or after production of such evidence as may be required is to be made. From the provisions of a 11, it does 932 not appear that returns are to be scrutinised at the end of the year like in income tax cases and assessment made on the income of the year preceding the assessment year. It is to be made in regard to each return whenever according to the rules the return has to be and is made. The tax is also paid for that period i.e. on the taxable turnover for the period for which the return is made and which becomes the subject matter of assessment. When the assessment has been made and the tax assessed is paid the assessment for that period is completed and all proceedings and liabilities and subjected to what is stated as to escaped periods. This is further clear from the rules which have been made in regard to registration and furnishing of returns. In the registration certificate it has to be mentioned as to what goods are free of tax. Returns are required to be made in the Forms which are given i.e. Form VIII or Form XXIII. A return under Form VIII may be monthly, quarterly or yearly. A return to be made also provides for mentioning the turnover of tax free goods and goods which are exempted from sales tax. If the contention of the appellants is correct, then after all the returns have been filed, the amount of sales tax according to the returns assessed and payments made, there will have to be proceedings for reassessment, remission or refund as the case may be in regard to those periods, if any goods are added to the schedule exempting them from sales tax after the assessment or any goods are deleted from the schedule thus making them liable for sales tax and that will be for the periods of which the assessment had already been completed and finished. That does not seem to be the scheme of the Act. It does not envisage reassessment for the purpose of refunding the tax assessed and paid on articles which were assessable at the time the assessment was made but became exempt later nor is it envisaged in the case of 933 articles excluded from the schedule. Section 11(6) which deals with reassessments at the relevant time provided: "If upon information which has come into his possession the Assessing Authority is satisfied that any dealer has been liable to pay tax under this Act in respect of any period has failed to apply for registration, the Assessing Authority shall. . assess to the best of his judgment the amount of tax. .due from the dealer. " The scheme of the Act and the rules made thereunder do not, in my opinion, show that the exemption becomes operative for the whole year whenever during the year the notification of exemption is issued even though it may be on the last day of the financial year. I would therefore dismiss this appeal with costs. By Court. In accordance with the judgment of the majority, the appeal stands allowed with costs.

Section 6(1) of the East Punjab General Sales Tax Act, 1948, provided that no tax shall be payable on the sale of goods specified in the Schedule to the Act and that no dealer shall charge sales tax on the sale of goods which were "declared tax free from time to time". Sub section (2) of section 6 empowered the State Government by notification to add or to delete from the Schedule. On September 27, 1954, the State Government issued a notification under section 6 (2) 914 adding item 51 relating to manufactured tobacco to the Schedule. The appellant contended that sales tax was a yearly tax and hence the exemption, whenever given during the financial year, became operative as from the beginning thereof. ^ Held, (per Sinha, C. J., Hidayatullah, Shah and Mudholkar JJ., Kapur, J., dissenting) that the exemption operated for the entire financial year. The tax was a yearly tax levied on the taxable turnover of a dealer every year though it was collected in some cases at the end of the year, in some cases quarterly and in other cases monthly. If the exemption operated for the period for which the tax was payable according as it was annually, quarterly or monthly the tax would be different for different persons; those paying annually would get exemption for the whole year but those paying quarterly or monthly would get the benefit in the quarter or month of the notification and not for earlier quarters or months. This could not have been intended. The exemption whenever it came in, in the year for which the tax was payable, exempted sales throughout the year, unless the notification fixed the date for the commencement of the exemption. Commissioner of Sales Tax, U. P. vs The Modi Sugar Mills Ltd., ; , referred to. Per Kapur, J. The exemption became operative only from the date of the notification. The tax was not a yearly tax. The use of the words "tax free from time to time" in section 6 (1) showed that the exemption could be given at any time during the year and that it would operate from the date of the notification and not from the beginning of the financial year. Otherwise, an exemption given or an imposition made near the end of the year will both operate from the beginning of the year. This was never intended

n No. 105 of 1961. Petition under article 32 of the Constitution of India for the enforcement of Fundamental Rights. A. V. Viswanatha Sastri, M. K. B. Namburdripat and M. R. K. Pillai" for the petitioner. M. C. Setalvad Attorney General of India, K. K. Mathew, Advocate General for the State of Kerala, Sardar Bahadur, George Pudissary and V. A. Seyid Muhammad, for the respondent. December 5. The Judgment of P.B. Gajendragadkar, A. K. Sarkar, K. N. Wanchoo and K. C. Das Gupta, JJ., was delivered by Gajendragadkar, J. N. Rajagopala Ayyangar, J., delivered a separate judgment. GAJENDRAGADKAR, J. This petition has been filed under article 32 of the Constitution and it seeks to challenge the validity of the Kerala Agrarian Relations Act, 1960 (Act 4 of 1961) (hereafter called the Act). The petitioner owns about 1, 250 acres of land in the Kerala State. These lands were originally situated within the erstwhile State of Cochin which now forms part of the Kerala State. 757 Out of the lands owned by the petitioner nearly 900 acres are classified in the land records maintained by the State as Pandaravaka holdings while the remaining lands are classified as Puravaka holdings. By his petition the petitioner claims a declaration that the Act is ultra vires and unconstitutional and prays for a writ of certiorari or other appropriate writ, order or direction against the respondent, the State of Kerala, restraining it from implementing the provisions of the Act. It appears that a notification has been issued by the respondent on February 15, 1961, directing the implementation of sections 1 to 40, 57,58,60,74 to 79 as well as sections 81 to 95 of the Act from the date of the notification. The petitioner contends that the notification issued under the Act is also ultra vires, unconstitutional and illegal and as such he wants an appropriate writ or order to be issued quashing the said notification. That in brief is the nature of the reliefs claimed by the petitioner. The Kerala Agrarian Relations Bill which has ultimately become the Act was published in the Government Gazette of Kerala on December 18, 1957, and was introduced in the Kerala Legislative Assembly on December 21, 1957, by the Communist Government which was then in power. The bill was discussed in the Assembly and was ultimately passed by it on June 10, 1959. It was then reserved by the Governor of the State for the assent of the President under article 200 of the Constitution. Meanwhile, on July 31, 1959 the President issued a proclamation under article 356 and the Assembly was dissolved. In February 1960 mid term general elections took place in Kerala and as a result a coalition Government came into power. On July 27,1960, the President for whose assent the bill was pending sent it back with his message requesting the Legislative Assembly to reconsider the bill in the light of the specific amendments suggested by him. On August 2, 1960, the Governor returned the bill 758 remitted by the President with his message and the amendments suggested by him to the new Assembly for consideration. On September 26, 1960, the amendments suggested by the President were taken up for consideration by the Assembly and ultimately on October 15, 1960, the bill as amended in the light of the President 's recommendations was passed by the Assembly. It then received the assent of the President on January 21, 1961, and after it thus became law the impugned notification was issued by the respondent on February 15, 1961. On March 9, 1961, the present writ petition was filed. Broadly stated three points fall to be considered in this petition. The petitioner challenges the validity of the Act on the preliminary ground that the bill which was pending before the President for his assent at the time when the Legislative Assembly was dissolved lapsed in consequence of the said dissolution and so it was not competent to the President to give his assent to a lapsed bill with the result that the said assent and all proceedings taken subsequent to it are constitutionally invalid. If this preliminary point is upheld no further question would arise and the petition will have to be allowed on that ground alone. If however, this preliminary challenge to the validity of the bill does not succeed the respondent raises its preliminary objection that the Act is protected under article 31 A (1) (a) and as such its validity cannot be challenged on the ground that it is inconsistent with, or takes away, or abridges, any of the rights conferred by articles 14, 19 and 31. This point raises the question as to whether the properties owned and possessed by the petitioner are an "estate" within the meaning of article 31 A (2) (a). If this question is answered in the affirmative then the Act would be protected under article 31 A (1) (a) and the challenge to its validity on the ground that it is inconsistent with articles 14,19 and 31 will not 759 survive. If, however, it is held that the whole or any part of the properties with which the petitioner is concerned is outside the purview of "estate" as described by article 31 A (2) (a) the challenge to the validity of the Act on the merits would have to be considered. The petitioner contends that the material provisions of the Act contravenes the fundamental rights guaranteed by Arts, 14, 19 (1) (f) and 31 of the Constitution. That is how three principal points would call for our decision in the present writ petition. Let us first examine the argument that the bill which was pending the assent of the President at the time when the legislative Assembly was dissolved has lapsed and so no further proceedings could have been validly taken in. respect of it. In support of this argument it is urged that wherever the English parliamentary form of Government prevails the words "prorogation" and "dissolution" have acquired the status of terms of art and their significance and consequence are well settled. The argument is that if there is no provision to the contrary in our Constitution the English convention with regard to the consequence of dissolution should be held to follow even in India. There is no doubt that, in England, in addition to bringing a session of Parliament to a close prorogation puts and end to all business which is pending consideration before either House at the time of such prorogation; as a result any proceedings either in the House or in any Committee of the house lapse with the session Dissolution of Parliament is invariably preceded by prorogation, and what is true about the result of prorogation is, it is said, a fortiori true about the result of dissolution (1). Dissolution of Parliament is sometimes described as "a civil death of Parliament". Ilbert, in his work on 760 'Parliament ', has observed that "prorogation means the end of a session (not of a Parliament)"; and adds that "like dissolution, it kills all bills which have not yet passed". He also describes dissolution as an "end of a Parliament (not merely of a session) by royal proclamation", and observes that "it wipes the slate clean of all uncompleted bills or other proceedings". Thus, the petitioner contends that the inevitable conventional consequence of dissolution of Parliament is that there is a civil death of Parliament and all uncompleted business pending before Parliament lapses. In this connection it would be relevant to see how Parliament is prorogued. This is how prorogation is described in May 's "Parliamentary Practice": "If Her Majesty attends in person to prorogue Parliament at the end of the session. the same ceremonies are observed as at the opening of Parliament: the attendance of the Commons in the House of Peers is commanded; and, on their arrival at the bar, the Speaker addresses Her Majesty, on presenting the supply bills, and adverts to the most important measures that have received the sanction of Parliament during the session. The royal assent is then given to the bills which are awaiting that sanction, and Her Majesty 's Speech is read to both Houses of Parliament by herself or by her Chancellor; after which the Lord Chancellor, having received directions from Her Majesty for that purpose, addresses both Houses in this manner: "My Lords and Members of the House of Commons, it is Her Majesty 's royal will and pleasure that this Parliament be prorogued (to a certain day) to be then here holden; and this Parliament is accordingly prorogued" (2). According to May, the effect of prorogation is at once to suspend all business until Parliament shall be summoned again. Not only are the proceedings of Parliament at an end but all proceedings pending at the time are quashed except 761 impeachment by the Commons and appeals before the House of Lords. Every bill must therefore be renewed after prorogation as if it had never been introduced. To the same effect are the statements in Halsbury 's "Laws of England" (Vide: Vol. 28, pp. 371, 372, paragraphs 648 to 651). According to Anson, "prorogation ends the session of both Houses simultaneously and terminates all pending business. A bill which has passed through some stages but which is not ripe for royal assent at the date of prorogation must begin at the earliest stage when Parliament is summoned again and opened by a speech from the throne" (1). It would thus be seen that under English parliamentary practice bills which have passed by both Houses and are awaiting assent of the Crown receive the royal assent before the Houses of Parliament are prorogued. In other words, the procedure which appears to be invariably followed in proroguing and dissolving the Houses shows that no bill pending royal assent is left outstanding at the time of prorogation or dissolution. That is why the question as to whether a bill which is pending assent lapses as a result of prorogation or dissolution does not normally arise in England. Thus, there can be no doubt that in England the dissolution of the Houses of Parliament kills all business pending before either House at the time of dissolution. According to the petitioner, under our Constitution the result of dissolution should be held to be the same; and since the bill in question did not receive the assent of the President before the Assembly was dissolved it should be held that the said bill lapsed. This argument has taken another form. The duration of the Legislative Assembly is prescribed by article 172(1), and normally at the end of five years the life of the Assembly would come to an end. Its life could come to an end even before the expiration of the said period 762 of five years if during the said five years the President acts under article 356. In any case there is no continuity in the personality of the Assembly where the life of one Assembly comes to an end and another Assembly is in due course elected. If that be so, a bill passed by one Assembly cannot, on well recognised principles of democratic government. be brought back to the successor Assembly as though a change in the personality of the Assembly had not taken place. The scheme of the Constitution in regard to the duration of the life of State Legislative Assembly, it is urged, supports the argument that with the dissolution of the Assembly all business pending before the Assembly at the date of dissolution must lapse. This position would be consonant with the well recognised principles of democratic rule. The Assembly derives its sovereign power to legislate essentially because it represents the will of the citizens of the State, and when one Assembly has been dissolved and another has been elected in its place, the successor Assembly cannot be required to carry on with the business pending before its predecessor, because that would assume continuity of personality which in the eyes of the Constitution does not exist. Therefore, sending the bill back to the successor Assembly with the message of the President would be inconsistent with this basic principle of democracy. It is also urged that in dealing with the effect of the relevant provisions of the legislative procedure prescribed by article 196 it would be necessary to bear in mind that the powers of the legislature which are recognised in England will also be available to the State Legislature under article 194 (3). The argument is that whether or not a successor Legislative Assembly can carry on with the business pending before its predecessor at the time of its dissolution is really 763 a matter of the power of the Legislature and as such the powers of the Legislative Assembly shall be "such as may from time to time be defined, by the Legislature by law, and, until so defined, shall be those of the House of Commons of Parliament of the United Kingdom, and of its Members and Committees, at the commencement of this Constitution". In other words, this argument assumes that the conventional position with regard to the effect of dissolution of Parliament which prevails in England is expressly saved in India by virtue of article 194(3) until a definite law is passed by the State Legislature in that behalf to the contrary. It would be noticed that this argument purports to supply a constitutional basis for the contention which we have already set out that the word "dissolution" is a term of art and its effect should be the same in India as it is in England. It may incidentally be pointed out that the corresponding provisions for our Parliament are contained in article 104(3). As we have already mentioned there is no doubt that dissolution of the House of Parliament in England brings to a close and in that sense kills all business pending before either House at the time of dissolution; but, before accepting the broad argument that this must inevitably be the consequence in every country which has adopted the English Parliamentary form of Government it would be necessary to enquire whether there are any provisions made by our Constitution which deal with the matter; and if the relevant provisions of our Constitution provide for the solution of the problem it is that solution which obviously must be adopted. This position is not disputed. Therefore, in determining the validity of the contentions raised by the petitioner it would be necessary to interpret the provisions of article 196 and determine their effect. The corresponding provisions in regard to the 764 legislative procedure of Parliament are contained in article 107. The argument based on the provisions of article 194(3) is, in our opinion, entirely misconceived. The powers, privileges and immunities of State Legislatures and their members with which the said Article deals have no reference or relevance to the legislative procedure which is the subject matter of the provisions of article 196. In the context, the word 'powers ' used in article 194(3) must be considered along with the words "privileges and immunities" to which the said clause refers, and there can be no doubt that the said word can have no reference to the effect of dissolution with which we are concerned. The powers of the House of the Legislature of a State to which reference is made in article 194(3) may, for instance, refer to the powers of the House to punish contempt of the House. The two topics are entirely different and distinct and the provisions in respect of one cannot be invoked in regard to the other. Therefore, there is no constitutional basis for the argument that unless the Legislature by law has made a contrary provision the English convention with regard to the effect of dissolution shall prevail in this country. What then is the result of the provisions of article 196 which deals with the legislative procedure and makes provisions in regard to the introduction and passing of bills? Before dealing with this question it may be useful to refer to some relevant provisions in regard to the State Legislature under the constitution. Article 168 provides that for every State there shall be a Legislature which shall consist of the Governor and (a) in the States of Bihar, Bombay, Madhya Pradesh, Madras, Mysore, Punjab, Uttar Pradesh and West Bengal, two Houses, and (b) in other States, one House. In the present petition we are concerned with the State of Kerala which has only one House 765 Article 168 (2) provides that where there are two House of the Legislature of a State. one shall be known as the Legislative Council and the other as the Legislative Assembly, and where there is only one House, it shall be known as the Legislative Assembly. Article 170 deals with the composition of the Legislative Assembly. and article 171 with that of the Legislative Council. Article, 172 provides for the duration of the State Legislatures. Under article 172(1) the normal period for the life of the Assembly is five years unless it is sooner dissolved. Article 172(2) provides that the Legislative Council of a State shall not be subjected to dissolution, but as nearly as possible one third of the members thereof shall retire as soon as may be on the expiration of every second year in accordance with the provisions made in that behalf by Parliament by law. It would thus be seen that under the Constitution where the State Legislature is bicameral the Legislative Council is not subject to dissolution and this is a feature which distinguishes the State Legislatures from the England Houses of Parliament. When the Parliament is dissolved both the Houses stand dissolved, whereas the position is different in India. In the States with bicameral Legislature only the Legislative Assembly can be dissolved but not the Legislative Council. The same is the position under article 83 in regard to the House of the People and the Council of States. This material distinction has to be borne in mind in construing the provisions of article 196 and appreciating their effect. Article 196 reads thus: "196. (1) Subject to the provisions of Articles 198 and 207 with respect to Money Bills and other financial Bills, a Bill may originate in either House of the Legislature of a State which has a Legislative Council. 766 (2) Subject to the provision of articles 197 and 198, a Bill shall not be deemed to have been passed by the Houses of the Legislature of a State having a Legislative Council unless it has been agreed to by both Houses either without amendment or with such amendments only as are agreed to by both Houses. (3) A Bill pending in the Legislature of a State shall not lapse by reason of the prorogation of the House or Houses thereof. (4) A Bill pending in the Legislative Council of a State which has not been passed by the Legislative Assembly shall not lapse on a dissolution of the Assembly. (5) A Bill which is pending the Legislative Assembly of a State, or which having been passed by the Legislative Assembly is pending in the Legislative Council, shall lapse on a dissolution of the Assembly". With the first two clauses of this Article we are not directly concerned in the present petition. It is the last three clauses that call for our examination Under cl. (3) a Bill pending in the Legislature of a State will not lapse by reason of the prorogation of the House or Houses thereof. Thus, this clause marks a complete departure from the English convention inasmuch as the prorogation of the House or Houses does not affect the business pending before the Legislature at the time of prorogation. In considering the effect of dissolution on pending business it is therefore necessary to bear in mind this significant departure made by the Constitution in regard to the effect of prorogation. Under this clause the pending business may be pending either in the Legislative Assembly or in the Legislative Council or may be pending the assent of the Governor. At whichever stage the 767 pending business may stand, so long as it is pending before the Legislature of a state it shall not lapse by the prorogation of the Assembly. Thus, there can be no doubt that unlike in England prorogation does not wipe out the pending business. Clause (4) deals with a case where a Bill is pending in the Legislative Council of a State and the same has not been passed by the Legislative Assembly; and it provides that such a bill pending before the Legislative Council of a State shall not lapse on the dissolution of the Legislative Assembly. It would be noticed that this clause deals with the case of a Bill which has originated in the Legislature Council and has yet to reach the Legislative Assembly; and so the Constitution provides that in regard to such a Bill which has yet to reach, and be dealt with by, the Legislative Assembly the dissolution of the Legislative Assembly will not affect its further progress and it will not lapse despite such dissolution. That takes us to cl. This clause deals with two categories of cases. The first part deals with Bills which are pending before the Legislative Assembly of a State, and the second with Bills which having been passed by the Legislative Assembly are pending before the Legislative Council. The Bills falling under both the clause lapse on the dissolution of the Assembly. The latter part of cl. (5) deals with cases of Bills which are supplemental to the cases covered by cl. Whereas cl.(4) dealt with Bills which had originated in the Legislative Council the latter part of cl.(5) deals with Bills which, having originated in the Legislative Assembly, have been passed by it and are pending before the Legislative Council. Since cl. (4) had provided that Bills falling under it shall not lapse on dissolution of the Assembly it was thought necessary to provide as a matter of precaution that Bills falling under the latter part of cl. (5) shall lapse on the dissolution of the Assembly. 768 That leaves part 1 of cl. (5) to be considered. This part may cover three classes of cases. It may include a Bill which is pending before the Legislative Assembly of a State which is unicameral and that is the case with which we are concerned in the present proceedings. It may also include a case of a Bill which is pending before the Legislative Assembly of a state which is bicameral; or it may include a case of a Bill which has been passed by the Legislative Council in a bicameral State and is pending before the Legislative Assembly. In all these cases the dissolution of the Assembly leads to the consequence that the Bills lapse. It is significant that whereas cl. (3) deals with the case of a Bill pending in the Legislature of a State, cl. (5) deals with a Bill pending in the Legislative Assembly of a State or pending in the Legislative Council; and that clearly means that a Bill pending assent of the Governor or the President is outside cl. If the Constitution makers had intended that a Bill pending assent should also lapse on the dissolution of the Assembly a specific provision to that effect would undoubtedly have been made. Similarly, if the Constitution makers had intended that the dissolution of the Assembly should lead to the lapse of all pending business it would have been unnecessary to make the provisions of cl. (5) at all. The cases of Bills contemplated by cl. (5) would have been governed by the English convention in that matter and would have lapsed without a specific provision in that behalf. Therefore, it seems to us that the effect of cl. (5) is to provide for all cases where the principle of lapse on dissolution should apply. If that be so, a Bill pending assent of the Governor or President is outside cl. (5) and cannot be said to lapse on the dissolution of the Assembly. It is however, contended by the petitioner that if cl. (5) was intended to deal with all cases 769 where pending business would lapse on the dissolution of the Assembly it was hardly necessary to make any provision by cl. There is no doubt in force in the contention; but, on the other hand it may have been thought necessary to make a provision for Bill pending in the Legislative Council of a State because the Legislative Council of a continuing body not subject to dissolution and the Constitution wanted to make a specific provision based on that distinctive character of the Legislative Council. Having made a provision for a Bill originating and pending in the Legislative Council by cl. (4) it was thought necessary to deal with a different category of cases where Bills have been passed by the Legislative Assembly and are pending in the Legislative Council; and so the latter part of cl. (5) was included in cl. On the other hand, if the petitioner 's contention is right cls. (3) and (4) of article 196 having provided for cases were business did not lapse it was hardly necessary to have made any provisions by cl. (5) at all. In the absence of cl. (5) it would have followed that all pending business, on the analogy of the English convention, would laps on the dissolution of the Legislative Assembly. It is true that the question raised before us by the present petition under article 196 is not free from difficulty but, on the whole, we are inclined to take the view that the effect of cl. (5) is that all cases not falling within its scope are not subject to the doctrine of lapse of pending business on the dissolution of the Legislative Assembly. In that sense we read cl. (5) as dealing exhaustively with Bills which would lapse on the dissolution of the Assembly. If that be the true position then the argument that the Bill which was pending assent of the President lapsed on the dissolution of the Legislative Assembly cannot be upheld. In this connection it is necessary to consider articles 200 and 201 which deal with Bills reserved for the assent of the Governor or the President. 770 Article 200 provides, inter alia, that when a Bill has been passed by the Legislative Assembly of a State it shall be presented to the Governor, and the Governor shall declare either that he assents to the Bill or that he withholds assent therefrom or that he reserves the Bill for the consideration of the President. The proviso to this Article requires that the Governor may, as soon as possible after the presentation to him of the Bill for assent, return the Bill if it is not a Money Bill together with a message requesting that the House or Houses will reconsider the Bill or any specified provisions thereof and, in particular, will consider the desirability of introducing any such amendments as he may recommend in his message and, when a Bill is so returned the House or Houses shall reconsider the Bill accordingly, and if the Bill is passed again by the House or Houses with or without amendment and presented to the Governor for assent the Governor shall not withhold assent therefrom. The Second proviso deals with cases where the Governor shall not assent to but shall reserve for the consideration of the President any Bill which in the opinion of the Governor would, if it became law, so derogate from the powers of the High Court as to endanger the position which that Court is by this Constitution designed to fill. Article 201 then deals with the procedure which has to be adopted when a Bill is be assented to by the President. Under the said Article the President shall declare either that he assents to the Bill or that he withholds assent therefrom. The proviso lays down, inter alia, that the President may direct the Governor to return the Bill to the House together, with such message as is mentioned in the first proviso to article 200, and when a Bill is so returned the House shall reconsider it accordingly within a period of six months from the date of receipt of such message, and if it is again passed by the House with or without amendment it shall be presented again to the President for his consideration. The provisions of 771 these two Articles incidentally have a bearing on the decision of the question as to the effect of article 196. The corresponding provision for Parliamentary Bill is contained in article 111. It is clear that if a Bill pending the assent of the Governor or the President is hold to lapse on the dissolution of the Assembly unlikely that a fair number of Bills which may have been passed by the Assembly, say during the last six months of its existence, may be exposed to the risk of lapse consequent on the dissolution of the Assembly, unless assent is either withheld or granted before the date of the dissolution. If we look at the relevant provisions of articles 200 and 201 from this point of view it would be significant that neither Article provides for a time limit within which the Governor or the President should come to a decision on the Bill referred to him for his assent. Where it appeared necessary and expedient to prescribe a time limit the Constitution has made appropriate provisions in that behalf (vide : article 197 (1)(b) and (2)(b)). In fact the proviso to article 201 requires that the House to which the Bill is remitted with a message from the President shall reconsider it accordingly within a period of six months from the date of the receipt of such message. Therefore, the failure to make any provision as to the time within which the Governor or the President should reach a decision may suggest that the Constitution makers knew that a Bill which was pending the assent of the Governor or the President did not stand the risk of laps on the dissolution of the Assembly. That is why no time limit was prescribed by articles 200 and 201. Therefore, in our opinion, the scheme of articles 200 and 201 supports the conclusion that a Bill pending the assent of the Governor or the President does not lapse as a result of the dissolution of the Assembly and that incidentally shows that the provisions of article 196(5) are exhaustive. 772 At this stage it is necessary to examine another argument which has been urged against the validity of the Act on the strength of the provisions of articles 200 and 201. It is urged that even if it be held that the Bill does not lapse, the Act is invalid because it has been passed in contravention of articles 200 and 201. The argument is that the scheme of the said two Articles postulates that the Bill which is sent back with the message of the President ought to be sent back to the same house that originally passed it. It is pointed out that when the message is sent by the President the House the requested to reconsider the Bill and it is provided that if the Bill is again passed by the House the Governor shall not withhold assent therefrom. This argument proceeds on the basis that the concept of reconsideration must involve the identity of the House, because unless the House had considered it in the first instance it would be illogical to suggest that it should reconsider it. Reconsideration means consideration of the Bill again and that could be appropriately done only if it is the same House that should consider it at the second stage. The same comment is made on the use of the expression "if the Bill is passed against. It is also urged that it would be basically unsound to ask the successor House to take the Bill as it stands and not give it an opportunity to consider the merits of all the provisions of the Bill. We are not impressed by these pleas. When the successor House is considering the Bill it would be correct to say that the Bill is being reconsidered because in fact it had been considered once. Similarly, when it is said that if the Bill is passed again the Governor shall not withhold assent therefrom it does not postulate the existence of the same House because even if it is the successor House which passes it is true to say that the Bill has been passed again because in fact it had been passed on an early occasion. Besides, if the effect of article 196 is that the Bills 773 pending assent do not lapse on the dissolution of the House then relevant provisions of article 200 must be read in the light of that conclusion. In our opinion, there is nothing in the proviso to article 201 which is inconsistent with the basic concept of democratic Government in asking a successor House to reconsider the Bill with the amendments suggested by the President because the proviso makes it, perfectly clear that it is open to the successor House to throw out the Bill altogether. It is only if the Bill passed by the successor House that the stage is reached to present it to the Governor or President for his assent, not otherwise. Therefore, there is no substance in the argument that even if the effect of article 196 is held to be against the theory of lapse propounded by the petitioner the Bill is invalid because it has been passed in contravention of the provisions of articles 200 and 201. This argument proceeds on the assumption that the House to which the Bill is sent must be the same House and that assumption, we think is not well founded. We would accordingly hold that the preliminary contention raised against the validity of the Bill cannot be sustained. That takes us to the point raised by the respondent that the Act attracts the protection of article 31A (1)(a) and so is immune from any challenge under articles 14, 19 and 31. There is no doubt that if the Act falls under article 31A(1)(a) its validity cannot be impugned on the ground that it contravenes articles 14, 19 and 31; but the question still remains: Does the Act fall under article 31A (1) (a) ?; and the answer to this question depends on whether or not the properties of the petitioner fall within article 31A(2)(a). Before dealing with this point it is necessary to set out the relevant provisions of article 31A (2) Article 31A(2) reads thus: "31A (2). In this article (a) the expression 'estate ' shall, in relation to any local area, have the same meaning 774 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, and in the States of Madras and Kerala any janmam right; (b) the expression 'rights ', in relation to an estate, shall include any rights vesting in a proprietor, sub proprietor, under proprietor tenure holder, raiyat, under raiyat or other intermediary and any rights or privileges in respect of land revenue. " Article 31A was added by the Constitution (First Amendment) Act, 1951, with retrospective effect. Similarly, the portion in italics was added by the Constitution (Forth Amendment) Act, 1955, with retrospective effect. It is well known that the Constitution First Amendment of 1951 was made in order to validate the acquisition of zamindari estates and the abolition of permanent settlement. In other words the effect of the First Amendment was to provide that any law which affected the right of any proprietor or intermediate holder in any estate shall not be void on the ground that its provisions were inconsistent with any of the fundamental rights guaranteed by part III of the Constitution. The acquisition of zamindnri rights and the abolition of permanent settlement, however, was only the first step in the matter of agrarian reform which the Constitution makers had in mind. When the first zamindari abolition laws were passed in pursuance of the programme of social welfare legislation their validity was impugned on the ground that they contravened the provisions of articles 14, 19 and 31. In order to save the impugned legislation from any such challenge articles 31A and 31B and the Ninth Schedule were enacted by the Constitution First Amendment Act; and it is in that context that article 31A (2) (a) 775 and (b) were also enacted. After the zamindari abolition legislation was thus saved the Constitution makers thought of enabling the State Legislatures to take the next step in the matter of agrarian reform. As subsequent legislation passed by several States shows the next step which was intended to be taken in the matter of agrarian reform was to put a ceiling on the extent of individual holding of agricultural land. The inevitable consequence of putting a ceiling on individual occupation or ownership of such agricultural land was to provide for the acquisition of the land held in excess of the prescribed maximum for distribution amongst the tillers of the soil. It is in the light of this background that we have to determine the question as to whether the property with which the petitioner is concerned constitutes an estate or rights in relation to an estate under cl. (2)(a) or (b). The petitioner contends that in interpreting the expression "estate" we must have regard to the fact that originally it was intended to cover case of zamindars and other intermediaries who stood between the State and the cultivator and who were generally alienees of land revenue; and so it is urged that it is only what may be broadly described as landlord tenures which fall within the scope of the expression "estate ". It is conceded that the expression "rights in relation to an estate " as it now stands is very broad and it includes the interest of a raiyat and also an under raiyat; but it is pointed out that the said rights, however comprehensive and broad they may be, must be rights in relation to an estate, and unless the property satisfies the test which would have been reasonably applied in determining the scope of "estate" in 1950 the amendment made in cl. (2)(b) will not make the denotation of the word "estate" any broader. In other words, the argument is that the denotation which the expression "estate " had in 1950 continues to be the same even after the 776 amendments of 1965 because no suitable amendment has been made in cl. (2) (a). But the infirmity in this argument is that the limitation which the petitioner seeks to place on the denotation of the expression "estate" is not justified by any words used in cl. (2)(a) at all; it is introduced by reading cls. (2)(a) and (b) together, and that would not be reasonable or legitimate. In deciding what an "estate" means in cl. (a) we must in the first instance construe cl. (a) by itself. In dealing with the effect of cl. (2) (a) two features of the clause are significant. First, that the definition has been deliberately made inclusive, and second, that its scope has been left to be determined not only in the light of the content of the expression "estate " but also in the light of the local equivalent of the expression "estate" as may be found in the existing law relating to land tenure in force in that area. The Constitution makers were fully conscious of the fact that the content of the expression "estate" may not be identical in all the areas in this country and that the said concept may not be described by the same word by the relevant existing law; and so the decision of the question as to what an estate is has been deliberately left rather elastic. In each case the question to decide would be whether the property in question is described as an estate in the terminology adopted by the relevant law. If the said law uses the word "estate" and defines it the there is no difficulty in holding the property described by the local law as an estate is an estate for the purpose of this clause. The difficulty arises only where the relevant local law does not describe any agricultural property expressly as an estate. It is conceded that though no agricultural property may be expressly described as an estate by the local law, even so there may be some properties in the area which may constitute an 777 estate under cl. (2) (a); and so in deciding which property constitutes an estate it would be necessary to examine its attributes and essential features and enquire whether it satisfies the test implied by the expression "estate " as used in cl. (2) (a) In this connection it is pertinent to remember that the Constitution makers were aware that in several local areas in the country where the zamindari tenure did not prevail the expression "estate" as defined by the relevant law included estates which did not satisfy the requirement of the presence of intermediaries, and yet cl. (2)(s) expressly includes estates in such areas within its purview and that incidentally shows that the concept of " estate " as contemplated by cl. (2)(a) is not necessarily conditioned by the rigid and inflexible requirement that it must be landlord tenure of the character of zamindari estate. That is why, treating the expression "estate" as of wide denotation in every case we will have to enquire whether there is a local definition of "estate" prevailing in the relevant existing law; if there is one that would determine the nature of the property. If there is no definition in the relevant existing law defining the word "estate" as such we will have to enquire whether there is a local equivalent, and in that connection it would be necessary to consider the character of the given agricultural property and its attributes and then decide whether it can constitute an estate under cl. (2)(a). If the expression "estate" is construed in the narrow sense in which the petitioner wants it to be construed then it may not be easy to reconcile the said narrow denotation with the wide extent of the word "estate" as is defined in some local definitions of the word "estate ". Therefore, in deciding the question as to whether the properties of the petitioner are an "estate" within the meaning of article 31A(2)(a) we are not prepared to adopt 778 the narrow construction that the estate must always and in every case represent the estate held by zamindars or other similar intermediaries who are the alienees of land revenue. This question can also be considered from another point of view. As we will presently point out, decisions of this Court in relation to agricultural estates existing in areas where the zamindari tenure does not prevail clearly show that the definitions in the relevant existing laws in those areas include properties within the expression "estate" despite the fact that the condition of the existence of the intermediary is not satisfied by them, and so there can be no doubt that even in such ares if the definition of the word "estate" includes specified agricultural properties they would be treated as estates under cl. (2)(a). Now just consider what would be the position in areas where the zamindari tenure does not prevail and where the relevant existing law dose not contain a definition of an "estate" as such. According to the petitioner 's argument where in such a case it is necessary to find out a local equivalent of an estate the search for such a local equivalent would be futile, because in the area in question the condition or test of the presence of intermediaries may not be satisfied and that would mean that the main object with which the Constitution First and Fourth Amendment Acts of 1951 and 1955 were passed would be of no assistance to the State Legislatures in such local areas. If the State Legislatures in such local areas want to enact a law for agrarian reform they would not be able to claim the benefit of article 31 A (1)(a). Indeed, the petitioner concedes that on his construction of cl. (2) (a) the intended object of the amendments may not be carried out in certain areas where the existing relevant law does not define an estate as such; but his argument is that the Constitution makers failed to give effect to their intention 779 because they omitted to introduce a suitable amendment in cl. (2)(a). On a fair construction of cl. (2) (a) we do not think that we are driven to such a conclusion. Therefore, we are not inclined to accept the petitioner 's narrow interpretation of the word "estate" in cl. (2) (a). It is necessary therefore to have some basic idea of the meaning of the word "estate" as used in article 31A(2) (a). As we have said already, where the word "estate" as such is used in the existing law relating to land tenures in force in a particular area, there is no difficulty and the word "estate" as defined in the exiting law would have that meaning for that area and there would be no necessity for looking for a local equivalent. But where the word "estate" as such is not defined in an existing law it will be necessary to see if some other term is defined or used in the existing law in a particular area which in that area is the local equivalent of the word "estate". In that case the word "estate" would have the meaning assigned to that term in the existing law in that area. To determine therefore whether a particular term defined or used in a particular area is the local equivalent of the word "estate" as used in article 31 A (2) (a) it is necessary to have some basic concept of the meaning of the word "estate" as used in the relevant Article of the Constitution. It seems to us that the basic concept of the word "estate" is that the person holding the estate should be proprietor of the soil and should be in direct relationship with the State paying land revenue to it except where it is remitted in whole or in part. If therefore a term is used or defined in any existing law in a local area which corresponds to this basic concept of "estate" that would be the local equivalent of word "estate" in that area. It is not necessary. that there must be an intermediary in an estate before it can be called an estate within the meaning of article 31 A (2)(a); it is true that in 780 many cases of estate such intermediaries exist, but there are many holders of small estates who cultivate their lands without any intermediary whatever. It is not the presence of the intermediary that determines whether a particular landed property is an estate or not; what determines the character of such property to be an estate is whether it comes within the definition of the word "estate" in the existing law in a particular area or is for the purpose of that area the local equivalent of the word "estate" irrespective of whether there are intermediaries in existence or not. This in our opinion, is also borne out by consideration of the relevant decisions of this Court to which we will now turn. The decisions of this Court where this question has been considered lend support to the construction of the word "estate" for which the respondent contends. In Sri Ram Ram Narain Medhi vs The State of Bombay (1) the constitutional validity of the Bombay Tenancy and Agricultural Lands (Amendment) Act 1956 (Bombay Act XIII of 1956) amending the Bombay Tenancy and Agricultural Lands Act, 1948 (Bombay Act LXVII of 1948), was considered by this Court. Section 2(5) of the Bombay Land Revenue Code, 1879, had defined the word "estate" as meaning any interest lands and the aggregate of such interested vested in a person or aggregate of persons capable of holding the same. This Court held that the Bombay Land Revenue Code was the existing law relating to land tenures in force in the State of Bombay and that the definition of the word "estate" as prescribed by s.2(5) had the meaning of any interest in land and it was not confined merely to the holdings of landholders of alienated lands. The expression applied not only to such estate holders but also to land holders and occupants of unalienated lands". It would be noticed that section 2(5) referred to "any 781 interest in lands" and the expression "lands" was undoubtedly capable of comprising within its ambit alienated and unalienated lands. The argument urged by the petitioner in that case in attacking the validity of the impugned Act in substance was that having regard to the narrow denotation of the "estate" used in article 31A(2)(a) the broader construction of section 2(5) of the Bombay Land Revenue Code should not be adopted, and in construing what is the local equivalent of the expression "estate" in Bombay the narrow construction of section 2(5) should be adopted and its operation should be confined to alienated lands alone. This contention was rejected and it was held that the estate as defined was not confined merely to the holdings of landholders of alienated lands. It is true that the decision proceeded substantially on the interpretation of section 2(5) of the local Act ; but it may be observed that if the denotation of the word "estate" occurring in article 31A(2)(a) was as narrow as is suggested to by the petitioner before us this Court would have treated that as a relevant and material fact in considering the contention of the petitioner before it that the narrow construction of section 2(5) should be adopted. There is no doubt that the property which was held to be an estate in Medhi 's case (1) would not be an estate within the narrow meaning of the word as suggested by the petitioner. In Atma Ram vs The State of Punjab (2), this Court had occasion to consider the meaning of the expression "estate" in the light of the Punjab Land Revenue Act, 1887. Section 3(1) of the said Act had provided that an "estate" means any area (a) for which a separate record of rights has been made, or (b) which has separately assessed to land revenue, or would have been so assessed if the land revenue had not been released, compounded for or redeemed, or(c) which the State Government may by general rule or special order, declare to be an estate. Section 3(3) which is also relevant provided 782 that "holding" means a share or portion of an estate held by one landowner or jointly by two or more landowners. One of the arguments urged by the petitioner before the Court was that a part of the holding was not an estate within the meaning of section 3(1) of the local Act. This argument was rejected. In dealing with the question as to whether the property held by the petitioner was an estate under the article 31A(2)(a) it became necessary for the Court to consider the amplitude of the expression "any estate or of any rights therein" in article 31A (1) (a). Sinha J., as he then was, who spoke for the Court, has elaborately examined the different kinds of land tenures prevailing in different parts of India, and has described the process of sub infeudation which was noticeable in most of the areas in course of time. An "estate", it was observed, "is an area of land which is unit of revenue assessment and which is separately entered in the Land Revenue Collector 's register or revenue paying or revenue free estates". "Speaking generally", observed Sinha, J., "It may be said that at the apex of the pyramid stands the State. Under the State, a large number of persons variously called proprietors, zamindars, malguzars, inamdars and jagirdars, etc., hold parcels of land, subject to the payment of land revenue designated as peshkash, quitrent or malguzari, etc., representing the Government demands by way of land tax out of the usufruct of the land constituting an state, except where the Government demands had been excused in whole or in part by way of reward for service rendered to the State in the past, or to be rendered in the future" (p. 759). "Tenure holders", it was observed, "were persons who took lands of an estate not necessarily for the purpose of self cultivation, but also for settling tenants on the land and realising rents from them. Thus, in each grade of holders of land, in the process of sub infeudation the holder is a tenant under his superior holder 783 the landlord, and also the landlord of the holder directly holding under him" (pp. 760, 761). Having thus considered the background of the land tenures in Punjab and elsewhere this Court proceeded to consider the amplitude of the crucial words "any estate or of any rights therein" in article 31A(1)(a). "According to this decision as the connotation of the term "estate" was different in different parts of the country, the expression "estate" described in cl. (2) of article 31A, has been so broadly defined as to cover all estates in the country, and to cover all possible kinds of rights in estates, as shown by sub cl. (b) of cl. (2) of article 31 A" (p. 762). "The expression `rights ' in relation to an estate has been given an all inclusive meaning comprising both what we have called, for the sake of brevity, the horizontal and vertical divisions of an estate. The Provisions aforesaid of article 31 A, bearing on the construction of the expression `estate ' or `rights ' in an estate, have been deliberately made as wide as they could be in order to take in all kinds of rights quantitative and qualitative in an area coextensive with an estate or only a portion thereof" (p. 763). Further observations made in the judgment in regard to the effect of the addition of words "raiyats" and "under raiyats" in cl. (b) may also be usefully quoted : "The expression `rights ' in relation to an estate again has been used in a very comprehensive sense of including not only the interests of proprietors or Sub proprietors but also of lower grade tenants, like raiyats or under raiyats, and then they added, by way of further emphasising their intention, the expression `other intermediary ', thus clearly showing that the enumeration of intermediaries was only illustrative and not exhaustive" (p. 765). Thus, this decision shows that the amendments made by the constitution First and Fourth Amendment Acts of 1951 and 1955 were intended to enable the State Legislatures to undertake the task of agrarian reform with the object of abolishing intermediaries 784 and establishing direct relationship between the State and tillers of the soil; and it is in that context that the would "estate" occurring in cl. (2) of article 31 A was construed by this Court. What we have said about the decision in Medhi 's case (1) is equally true about the decision in the case of Atma Ram (2). The property which was held to be an estate was not an estate in the narrow sense for which the petitioner contends. In Shri Mahadeo Paikaji Kolhe Yavatmal vs The State of Bombay and Shri Namadeorao Baliramji vs The State of Bombay (3) this Court had to consider the case of the petitioners in Vidarbha who held lands under the State and paid land revenue for the said lands thus held by them. The relevant provisions of the Madhya Pradesh Land Revenue Code. 1954 (II of 1955) were examined and it was held that though the word "estate" as. such had not been employed by the said Code the equivalent of the estate had to he determined under article 31 A (2) (a), and as a result of provisions of sections 145 and 146 of the said Code it was held that the estates held by the petitioners satisfied the test of the local equivalent of "estate" as contemplated by article 31A (2) (a). In The State of Bihar vs Rameshwar Pratap Narain Singh(4), this Court had occasion to consider the scope and effect of the expression "rights in relation to an estate" used in cl. (2) (b), and it held that "in the circumstances and in the particular setting in which the words `raiyat ' and `under raiyat ' were introduced into the definition it must be held that the words "or other intermediary" occurring at the end do not qualify or colour the meaning to be attached to the tenures newly added". It is in the light of these decisions that we must now proceed to examine the character of the properties with which the petitioner is concerned. As we have already seen the petitioner owns about 900 acres of land which are classified 785 as Pandaravaka holdings and about 350 acres which are described as Puravaka holdings. In meeting the respondent 's contention that these lands are an estate under cl. (2) (a) of article 31A the petitioner has alleged that the Pandaravaka tenure represents lands of which the State was in the position of the landlord and whatever rights other persons possessed were directly derived from the State. Of the several classes of Pandaravaka tenure the most common is the verumpattom and most of the petitioner 's lands falling under the Pandaravaka tenure belong to this class. The petitioner 's case is that his liability is to pay rent to the State calculated as a proportion of the gross yield of the properties ; and so the lands held by the petitioner as tenant under the State cannot be said to be an estate under cl. (2) (a). He is not an intermediary between the State and the tiller of soil and so is outside the purview of cl. (2) (a). It has also been alleged by the petitioner that his properties cannot be said to be an estate even in the sense of a local equivalent of the term "estate" because there is no unified record of rights over the area in question; "each survey number is often divided into several sub numbers and representing holdings that do not often take in more than a few cents has his own record of rights and separate assessment register". It is for these reasons that the petitioner resists the application of cl. (2) (a) to his Pandaravaka Verumpattom lands. No clear and specific plea has been expressly made by the petitioner in regard to Puravaka lands. In that connection the petitioner has, however, alleged that the Janmam is another peculiar feature of the land system in Kerala which it is not easy to define since a good deal of ambiguity attaches to the term. However he contends that the Janmam right has to be understood in its limited and technical sense as taking within its scope a particular form of land holding known as the known tenancy. 786 According to the petitioner the Janmam right included in cl. (2) (a) can take in only the rights and liabilities controlled and created by the two Tenancy Acts to which he has referred. That is how the petitioner contends that the Puravaka lands are also outside the purview of cl. (2) (a). It is common ground that the proclamation issued by his Highness Sir Rama Varma Raja of Cochin on March 10, 1905, is the relevant existing law for the purpose of deciding whether the agricultural properties of the petitioner constitute an estate under cl. (2)(a). It is therefore, necessary to examine the scheme of this proclamation and decide whether in view of the characteristics and attributes of the properties held by the petitioner they can be said to constitute a local equivalent of an estate under cl.(2)(a). This proclamation consists of twenty eight clauses which deal broadly with all the aspects of land tenure prevailing in the State of Cochin. The preamble to the proclamation recites that the Raja had already ordered that a complete survey embracing demarcation and mapping and the preparation of an accurate record of titles in respect of all descriptions of properties within his entire State shall be carried out, and it adds that directions had been issued that a revenue settlement or revision of the State demand shall be conducted in accordance with the principles laid down by the proclamation. Clause 6 enumerates the tenures of lands prevailing in the State. Under this clause there are two major tenures (1) Pandaravaka and (2) Puravaka. The former are held on one or the other of six varieties of tenures; of these we are concerned with the verumpattom sub tenure. This clause provides that the Pandaravaka verumpattom tenure shall be deemed as the normal tenure for settling the full State demand and that the other tenures shall be treated as favourable tenures and settled on the lines indicated in cls. 14 to 17. Clause 7 says that the present rate of assessment 787 on Pandaravaka verumpattom nilas varies from one eighth para to twelve paras of paddy for every para of land; and it adds that such a vast disparity of rates is indicative of unequal incidence under the existing revenue system. That is why the clause proceeds to lay down that the State demand should bear a fixed proportion to the produce a land is capable of yielding and so it prescribes that under the Pandaravaka verumpattom tenure the holder should pay half of the net produce to the State. The clause then proceeds to provide for the method in which this half of the net produce should be determined. Clauses 11 and 12 deal with the assessment on tree. Clause 13 is important. It says "at present holders of Pandaravaka verumpattom lands do not possess any property in the soil. As we are convinced that proprietorship in the soil will induce the cultivator to improve his land and thereby add to the prosperity of the land, we hereby declare that the verumpattom holders of lands shall, after the new settlement has been introduced, acquire full rights to the soil of the lands they hold and that their rights shall remain undisturbed so long as they regularly pay the State revenue provided that the rights to metals, minerals possessed by the State in all lands under whatever tenure they are held are reserved to the State". Under cl.18 it is provided, inter alia, that in the case of Pandaravaka lands held on the erumpattom tenure the settlement shall be made with the present holder of the land and in regard to Puravaka land with the Janmam. Clause 22 prescribes the procedure and the time for the introduction of settlement. It requires that before the introduction of the new rates of assessment a rough patta shall be issued to each of the landholders showing the relevant detail of his holdings and the assessment to be paid by him hereafter. The object of preparing such a patta is to 788 give an opportunity to the landholders to bring to the notice of the authorities their objections if any. The objections are then required to be heard before the final entries are made. Clause 26 declares that the new settlement shall be current for a term of thirty years. This has been done with a view to secure the utmost freedom of action to the landholders in improving their properties and turning them to the best advantage according to their means and inclination. Clause 27 deals with escheats; and cl. 28 makes general provisions as to the formation of a new land record including reassessment of land and the registration of titles "a work calculated to promote the well being of a State". It would thus be seen that under cl. 13 the person holding lands on the Pandaravaka verumpattom tenure is not a tenant. He is given the proprietary right in the soil itself, subject of course to the rights as to metals and minerals reserved in favour of the State. Indeed, the whole scheme of the new proclamation appears to be to change the character of the possession of the Pandaravaka verumpattom tenure holder from that of a tenant into that of a proprietor holder. It is true that he is made liable to pay half of the net produce and that may appear to be a little too high, but the measure of the levy will not convert what is intended to be a recovery of assessment into a recovery of rent. The proprietor of the land held on Pandaravaka verumpattom tenure is nevertheless a proprietor of the land and he holds the land subject to his liability to pay the assessment to the State. It is not difficult to imagine that in a fairly large number of lands held by Pandaravaka verumpattom tenure holders the holders in turn would let out the lands to the cultivators and thus would come into existence a local equivalent of the class of intermediaries. Land revenue record is required to be prepared by the proclamation and relevant entries showing the extent of the properties belonging to 789 the respective holders and the details about their liability to pay the assessment are intended to be shown in the said record. In our opinion, it would not be reasonable to hold that the lands held by the petitioner under the Pandaravaka verumpattom tenure do not confer on him the proprietary right at all but make him a tenant of the State. In the proclamation there does not appear to be a provision for forfeiture or surrender and the scheme adopted by the proclamation suggests that the amount due from the tenure holder by was of assessment would presumably be recovered as arrears of land revenue and not as rent. Therefore, we are inclined to hold that the Pandaravaka Verumpattom can be regarded as a local equivalent of an estate under cl. (2) (a) of article 31A. The position with regard to Puravaka lands is still more clear. Clause 14 of the proclamation enumerates four kinds of more favourable tenures. The first of these is the class of Puravaka lands. Clause 15 provides that in the case of Puravaka lands a third party called Janmi is recognised as owning proprietorship in the land and therefore entitled to share the produce with the cultivator and the sirkar. Then the clause describes the mode in which share of the State or its demand on these Puravaka lands is calculated, under the previously existing land system; and it provides new rates of assessment payable in respect of the Puravaka tenure. The Puravaka tenure in the State, the clause adds, corresponds to the normal conditions of land tenure in the District of Malabar where, in the recently introduced settlements, the net produce was distributed among the cultivator, the Janmi and the State in the following proportion : 790 __________________________________________________ __________ In Wet Lands In Garden Lands or Vrikshapattom Parambas __________________________________________________ __________ Cultivator 5 out of 15 5 out of 15 Jenmi 4 out of 15 5 out of 15 State 6 out of 15 5 out of 15 __________________________________________________ __________ Since it was thought that the said method of apportionment was fair and equitable the clause adopted the same in the State of Cochin. It would thus be clear that the lands held by the petitioner under the Puravaka tenure satisfy the test of even the narrow construction placed by the petitioner on the term "estate" in cl. (2)(a). Therefore, there can be no doubt that about 350 acres of land held by the petitioner on the Puravaka tenure constitute an estate under cl. (2)(a). The result is that the lands held by the petitioner are an estate under cl. (2)(a), and so the Act in so far as it operates against the holdings of the petitioner is protected under article 31A(1)(a) and so it is not open to the petitioner to challenge its validity on the ground that its material provisions offend against articles 14, 19 and 31 of the Constitution. The writ petition accordingly fails and is dismissed. There will be no order as to costs. AYYANGAR, J. I regret I am unable to agree that article 31A of the Constitution saves the Kerala Agrarian Relations Act, 1960, from challenge under articles 14, 19 and 31 of the Constitution in so far as the said Act relates to the Pandaravaka lands of the petitioner. Before however dealing with this point I consider it proper to add that I entirely agree that the Act was properly enacted by the State Legislature and that the consideration of the remitted bill by the new Legislative Assembly did not violate the provisions of article 20 of the Constitution. In my judgment the terms of article 196 of the Constitution proceed on the basis that the Constitution maker 791 in line with the framers of the Government of India Act, 1935, radically departed from the theory of the British Constitutional Law and the practice obtaining in the Parliament of the United Kingdom as regards the effect of dissolution of the Houses of the Legislature on bills passed by the House or Houses and pending the assent of the head of the State. Article 196 by its third clause having negatived the English rule that bills pending in the legislature lapse by reason of prorogation, goes on to enact cls. (4) and (5) making special provision for Lapse in the event of not prorogation but dissolution. Clause (5) enacts: "A bill which is pending in the Legislative Assembly of a State or which having been passed by the Legislative Assembly is pending in the legislative Council shall lapse on a dissolution of the Assembly." This clause on its terms applies both to States which have and which do not have a bicameral legislature. In its application to a State without a Legislative Council the relevant words of the clause would read: "A bill which is pending in a Legislative Assembly of a State. . .shall lapse on dissolution of the Assembly". The question that arises on the terms of this clause may be stated thus: Can a bill be said to be pending before the Legislative Assembly when it has gone through all the stages of the procedure prescribed for its passage through the house and has been passed by the Assembly ? Expressed in other words, does the pendency of a bill before the Assembly cease when it has passed through all the stages through which bills pass before the House or is it to be deemed as pending before the House until the bill receives the assent of the Governor or the President, as the case may be the latter event arising when bills are reserved by the Governor for the President 's assent ? Unless it could be contended that a bill 792 is pending in the Legislative Assembly until assent, there could be no scope for the argument based on article 196(5) in support of the position that an unassented bill is still pending in the Assembly. In this context the difference in the terminology employed in article 196(3) and 196(5) requires to be noticed. Whereas article 196(3) speaks of the pendency of a bill in the Legislature of a State which would, having regard to the description of 'Legislature ' in article 168, include the Governor, article 196(5) uses the words 'Legislative Assembly ' as if to indicate that it is only in the event of the bill being pending before that body that it lapses on dissolution. In the face of the provision in article 196(5) there is no justification for invoking the Biritish practice under which bills not assented to before the dissolution of the Houses are treated as having lapsed on that event occurring. If the Governor can assent or refuse to assent to a bill, which has passed through all the stages of consideration by a Legislative Assembly even though that Assembly is dissolved under the terms of article 200, because the bill is a live bill within the terms of that Article, it would follow that he can exercise the other alternative open to him under that Article, viz., to reserve the bill for the President 's assent. If by reason of the language employed in article 196(5) the bill is alive so far, and the President could assent to the bill it would follow that subject to an argument based on the terms of article 201 he can also remit the bill for reconsideration by the Assembly notwithstanding the dissolution. The next question for consideration is whether there is anything in the terms of article 201 which precludes effect being given to the above principle. The Article runs: 793 "201. When a Bill is reserved by a Governor for the consideration of the President, the President shall declare either that he assents to the Bill or that he withholds assent therefrom: Provided that, where the Bill is not a Money Bill, the President may direct the Governor to return the Bill to the House or, as the case may be, the Houses of the Legislature of the State together with such a message as is mentioned in the first proviso to article 200 and, when a Bill is so returned, the House or Houses shall reconsider it accordingly within a period of six months from the date of receipt of such message and if it is again passed by the House or Houses with or without amendment, it shall be presented again to the President for his consideration. " Considerable stress was laid by the Learned Counsel on the use of the two expressions 'return the bill to the House ' and 'the House shall reconsider it accordingly ' as indicating that the words underlined* unmistakably implied that the consideration of the bill must be by the Assembly which originally passed it. It was in this connection that reliance was placed on the terms of article 172(1) reading (omitting the proviso which is immaterial for the present purpose): "172. (1) Every Legislative Assembly of every State, unless sooner dissolved, shall continue for five years from the date appointed for its first meeting and no longer and the expiration of the said period of five years shall operate as a dissolution of the Assembly: " The argument was that the Constitution did not envisage the Assemblies having a continuous life but 794 that on the other hand it clearly contemplated different Legislative Assemblies each one having a definite life which ended either automatically at the end of five years or at an earlier period by dissolution and that in the context of this provision, to the words 'return ' and 'reconsider ' employed in article 201 their literal meaning must be attached. It is not possible to accept this construction as to the effect of article 172 on the rest of the provisions in this Part. No doubt, for particular purposes each Assembly is conceived of as having a life of limited duration but it does not follow that the Constitution does not envisage the Legislature as an institution. In this connection I consider it useful to refer to the decision of the Privy Council in Attorney General for New South Wales vs Rennie (1). The question before the Board was as ragards the true construction of a New South Wales statute "The Parliamentary Representatives ' Allowance Act" which by its section 2 made an annual grant to "every member of the Legislative Assembly now serving or hereafter to serve therein". Section 2 of the Imperial Act which enacted the Constitution Act of the Colony provided that "every Legislative Assembly was to continue for five years from the day of the return of writs for choosing the same and no longer, subject to be sooner prorogued or dissolved by the Governor of the Colony", which term was by a later enactment reduced to three years. The Attorney General for New South Wales raised an information seeking a declaration that there were no moneys legally available or applicable to the payment of members of future Assemblies with a prayer that the Auditor General might be restrained from countersigning the authorisation of such payments. The Supreme Court of the Colony dismissed the information whereupon the Attorney General brought the matter in appeal to the Privy 795 Council. The question turned on the meaning of the words 'the Legislative Assembly ' in section 2 of the Act and reliance was placed on behalf of the appellant on the provision for dissolution contained in the Imperial Act. It was contended that the Assembly was a body of limited duration called into existence from time to time and not a permanent and continuous body and that consequently the Act granting the allowance should be construed as applying to the members of the particular Assembly in existence on the date of the Act. Rejecting this argument, Sir, Richard Couch stated: "They think that according to the ordinary use of the term 'legislative assembly it means the assembly created by the Constitution Act which, though liable to be dissolved or to expire by effluxion of time, is an essential part of the constitution of the colony and must be regarded as a permanent body. " I consider these words apt to describe the reference to the "House of the Legislature" in the proviso to article 201. I therefore respectfully concur in the view that the bill was validly passed and that the objection based on an infringement or contravention of article 201 must be repelled. I shall now take up for consideration the merits of the petition. The petitioner is the owner of about 1,250 acres of land in Trichur in the erstwhile princely State of Cochin. Out of this extent, 900 acres are classified in the land records of the State as Pandaravaka Verumpattom lands and the remaining are entered as Puravaka lands. While so the Kerala Legislature enacted the Kerala Agrarian Relations Act, 1960 (Kerala Act IV of 1961), providing for the acquisition of certain types of agricultural lands in the State beyond the specified maximum extents laid down in the statute and 796 on payment of compensation as determined by it. The details of this legislation are set out and their impact on the owners of landed property in the State are dealt with in full in the judgment in Writ Petitions 114 and 115 which is being pronounced today. In the circumstances it is not necessary to say more about the enactment than point out that it seriously interferes with the rights of landowners in a manner which, as held in the judgment in the other petitions, is violative of the rights guaranteed to citizens by Part III of the constitution. For the respondent however the main defence on this petition is based on article 31A, the submission being that the lands of the petitioner by reason of the tenure by which he holds them, constitute an "estate" within the definition of that term in article 31A(2)(a). As the tenures which are involved in the case cover considerable areas of the former State of Cochin, and as the implications arising from any decision as regards these tenures might affect other areas, particularly in South India the effect of the acceptance of the submission by the respondent would be far reaching. I have therefore considered it proper to deal with matter from a wider angle than would be necessary if the effect of our decision would be confined to tenures of infrequent occurrence. The two tenures into which the lands held by the petitioner fall are, as stated earlier, Pandaravaka Verumpattom and the Puravaka, but before considering their characteristics it will be useful to attempt a picture of the general system of landholding in Malabar. As is well known, Malabar comprising the territories of the former princely State of Travancore & Cochin and the contiguous district of Malabar in the former Presidency of Madras, was among the few areas in India in which freehold rights in land were recognised. This exclusive right and hereditary possession and usufruct of the soil was denoted by the term "Jenm" 797 and the holder was designated the Jenmi or the Jenmikaran. The Jenmis had full and obsolute property in the soil. All land which was not the property of Jenmis or ceased to be theirs such as by forfeiture, were held by the State. These lands were let for rent to cultivators on terms of paying rent. The assertion by the State to the proprietorship of the soil which carried with it a denial of the right of alienation by the tenant of the leased lands and so of the right to hereditary enjoyment was besides being contrary to the accepted theory of the Hindu law givers, was also productive of grave economic ills. According to the Hindu Law givers starting from Manu, property in the soil arose out of occupation and cultivation. The texts which expound this position are set out and discussed by Westropp, C. J., in Vykunta Bapuji vs Government of Bombay(1) (See also Sundaraja Iyengar Land Tenures in the Madras Presidency, pp. 5 to21). According to this theory the King was not the owner of cultivated land but the proprietary interest in it vested in the cultivator, the right of the King being merely to the Raja bhagam which represented various proportions of the produce, sometimes thought of as being a sixth and at other times at higher proportions ranging up to a half. As observed by Subramania Iyer, J., in Venkata Narasimha vs Kotayya (2). "For, in the first place, sovereigns, ancient or modern, did 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, zemindars, poligars, mutadars 798 shro triemdars, inamdars or to Government officers, such as tahsildars, amildars, amins or thannadars, the payments which have always been made are universally deemed the due of Government. ' (See the Proceedings of the Board of Revenue, dated 5th January, 1818, quoted in the note at page 223 of Dewan Bahadur Srinivasa Raghava Ayyangar 's 'Progress in the Madras Presidency '). " This proprietary interest of the cultivator was in its true sense a property right being capable of alienation and of hereditary enjoyment. At the time of Permanent Settlement Regulation in Bengal (1793), and subsequently when its Madras counterpart was enacted (Regulation XXV of 1802), there was a great deal of controversy as to whether the East India Company as the Ruler was or was not entitled to the proprietary rights to the soil in the country. In the words of Westropp, C. J., in Vykunta Bapuji vs Government of Bombay (1) involved in this "was the question as to the character in which native governments claimed, from the occupants of the land, payments either in money or in produce in respect of the land. Were these payments rent or revenue ? Some maintained that those payments were rent, not revenue; because, it was said, the land could only be occupied and cultivated by the permission of the sovereign, and that such produce, as there may be in excess of what sufficed for the bare subsistence of the cultivators and for the expenses of cultivation, is the property of the sovereign. Others maintained that the sovereign was only entitled to a fixed portion of the produce, and that the surplus beyond that portion, plus the subsistence of the rayuts (cultivators) 799 and the cost of cultivation, belonged to a class of great landlords between the sovereign and the rayuts, which intermediate class consisted of zamindars, talukdars or similar personages; while others again strongly contended that, subject to a land tax payable to the sovereign, the property in the soil was vested in the cultivator, sometimes in the form of village communities holding corporately, at other times individuals holding in severalty, or jointly as members of an undivided family. In 1793, (either upon the ground that the soil was vested in the sovereign power, and that it was expedient that, by that power, a landed aristocracy should be created, or upon the ground, that the land, subject to the revenue assessment i.e., the king 's (or State 's share of the produce, ought to be publicly recognized as vested in the class of zamindars, & c., as landlords) the permanent settlement in Bengal, Bihar and Orissa was made by the Government of Lord Cornwallis, by recognizing the zamindars, & c., as the proprietors of the soil, and entitled to transfer it, and by fixing, once for all, the land tax payable by them to the State at an immutable annual rate. " In 1796 the Government of Madras declared that "it is the first feature in all the Governments of India, that the Sovereign, whether he be a Mussulman or Hindoo is lord of the soil; and hence it is that no alienation of lands from the property of the circar, or rather no possession of land whatever is valid without a written instrument from the superior lord; and this distinction has invariably followed the conquests of all nations who have established themselves in India". This statement was directly contrary to accepted practice and the consciousness of the cultivator in Madras. It is not therefore a matter for surprise 800 that in answer to this declaration of the Government, the Board of Revenue at once pointed out that "there were hereditary cultivators on lands with the right of making any disposition of them by sale, mortgage or otherwise as long as they paid the Government revenue, and that they only could not make any alienation of them to the exclusion of the royal share of the revenue. " Acting on the view that the Crown was the proprietor of the soil, the Birtish Government purported to confer proprietary rights in the soil on the zamindars under the Permanent Settlement the preamble to which referred to the reservation by the ruling power of the "implied right and actual exercise of the proprietary right to possession of all lands whatever" and by section 2 purported to vest in the zamindars the proprietary right to the soil. It was however found that this interfered with the established rights of cultivators and Madras Regulation IV of 1822 was passed to declare that the provisions of Regulation XXV of 1802 were not intended to affect the actual ryots in cultivation of lands. It might be added that the Privy Council ruled in Collector of Trichinapally vs Lekkamoni (1) that the theory underlying these words in the Regulation were not sustainable and that there were proprietary rights in land not traceable to or derived from the sovereign. The introduction of the Permanent Settlement with the creation of a class of zamindars as in Bengal was not considered to be a beneficial system by the Government of Madras and so after the grant of some sanads under Madras Regulation XXV of 1802 mostly in recognition of ancient titles the creation of new permanently settled estates was stopped and in its place, the system of revenue administration associated with the name of Sir Thomas Munro known as the ryotwari system was adopted. According to Munro there was 801 no need for the interposition of an intermediary between the State and the actual cultivator, particularly as it was clear that the system meant that the zamindars enjoyed what the cultivator parted with to the State; in other words, the difference between the rent paid by the actual cultivator, viz., the melwaram and the peishcush or the Jama fixed by the zamindar or proprietor was so much profit for the middleman and therefore pro tanto a diminution of the amount which would have accrued to the State. Besides, Munro considered that on economic grounds and with a view to increase agricultural production it was necessary for the State being in touch with the actual cultivator. For these reasons he formulated the "ryotwari system" and introduced it in several areas of the Madras Presidency and Coimbatore district adjoining the State of Cochin being almost the first among the districts where the system was introduced. The basic and essential feature of the system was that the fixation of the revenue assessment payable by the cultivator had to be proceeded by a survey of the a land which included the ascertainment of the productivity of the soil and that the assessment should be based on what was known as 'tharam ' (or quality) classification. The assessment thus began to be based on scientific data and principles and was so designed as to leave a sufficient margin to the cultivator to induce him to remain on the land and be assured of a good share in increased production resulting from the employment of his labour and capital. The terms on which the ryot held the land was contained in the patta issued to him on behalf of the Government and this specified the extent of land held by him as well as the amount of the assessment and the time when the instalments had to be paid. This was not however considered to be any document of title, because the ryot had the property in him and his interest was a proprietary interest in the soil and so capable 802 of being alienated and of being transmitted to his heirs. This however was not anything new and it was not as if the interest of the cultivator was not alienable before the ryotwari system was introduced. Before that date however, the assessment of the land was both heavy in most parts and unequal not being based on the productive capacity of the soil, as to leave little or no margin to the cultivator. Besides the predations of revenue and the severity of the tax was dependent on the exigencies and necessities, if not the whims of the ruler and in such a situation, even though technically cultivated land was capable of alienation there being no ban on alienation, still having regard to the meagre margin left to the owner and the fear of increased taxation based on no principle, no purchaser could be found; though owing to the impossibility of finding a more profitable use for manual labour apart from the sentimental attachment to land, the actual cultivator clung to his holding. But when with the advent of a system of assessment based on fixed and scientific principles which left a sufficient margin for the cultivator, and there was no fear of sudden increases of assessment, land became a marketable commodity investment in which was rendered worthwhile. Notwithstanding that in Malabar absolute ownership of the soil by the Jenmi where the land was the property of individuals and of the State where it was the owner, was a characteristic of the landholding, still from a fairly early date after the British conquest of the neighbouring areas the concept of the cultivator with whom the State entered into direct relations being conceded the proprietorship of the soil slowly permeated. In this connection I might usefully refer to a proclamation of the ruler of Travancore of 1865 (1040 M. E.) regarding Sarkar pattom lands, with the observation that subject to variations 803 dependent on local usages, the system of land tenure and the concepts as regards the rights of property in land were substantially similar in Travancore and Cochin. Sarkar pattom lands were what might be termed 'Crown lands ' of which the ruler was deemed to be the Jenmi or the landlord. Previous to the proclamation the lands were legally capable of being resumed by the ruler, though this was seldom done and the cultivators were not legally entitled to transfer their rights and where this was done the Government had the right to ignore the transaction. The fact that the cultivator was conceived of as having no proprietary interest on the land also bore adversely on the State since the State was deprived of the means of realising any arrears of revenue by bringing the holding to sale. It was to remedy this situation that the proclamation was issued and the preamble and its terms carry the impress of the impact of the ryotwari system of Madras. The proclamation reads: "Whereas we earnestly desire that the possession of landed as well as other property in Our Territory should be as secure as possible; and whereas We are of opinion that, with this view Sirkar Pattom lands can be placed on a much better footing than at present so as to enhance their value; we are pleased to notify to our Ryots 1st. That the Sirkar hereby and for ever surrenders, for the benefit of the people, all optional power over the following classes of lands, whether wet, garden or dry, and whether included in the Ayacut accounts or registered since: Ven Pattom, Vettolivoo Pattom, Maraya Pattom, Olavoo Pattom, Mara Pattom, 804 and all such Durkast Pattom, the tax of which is understood to be fixed till the next Survey and assessment. 2ndly. That the Ryots holding these lands may regard them fully as private, heritable, saleable, and otherwise transferable, property. 3rdly. Accordingly, the sales, mortgages, & c., of these lands will henceforward be valid, may be effected on stamped cadjans, and will be duly registered. The lands may be sold for arrears of tax, in execution of decrees of Courts and such other legitimate purposes, and may also be accepted as security by the Sirkar as well as by private individuals. 4thly. That the holders of the lands in question may rest assured that they may enjoy them undisturbed so long as the appointed assessment is paid. 5thly. That the said holders are henceforth at full liberty to lay out labour and capital on their lands of the aforesaid description to any extent they please, being sure of continued and secure possession. . . . " The language employed in the proclamation is of significance. It speaks of the relinquishment or withdrawal of the right of the State and not of the conferment of a right on the ryot so as to render the ryot a grantee from the State, just in line with the Hindu Law theory of the proprietorship of the soil vesting in the occupant cultivator. With this background, I shall proceed to consider the nature of the tenures Pandaravaka and Puravaka with which this petition is concerned. The two tenures are quite different in their origin and essential characteristics and so have to be separately dealt with. Pandaravaka lands are those in which the State held proprietary rights the 805 name being derived from Bandara or the treasury, while in regard to the Puravaka, they were lands in which the proprietorship vested in the Jenmi, but which were under the cultivation of tenants on whom the State imposed land revenue. Putting aside for the moment the Puravaka lands, the Pandaravaka lands might be approximated to the Crown lands dealt with by the Travancore Proclamation of 1865 already referred to. The terms on which the tenants held the right of the Crown were almost the same as in the other case. The evils which the system gave rise to, the economic insecurity of the tenant and the consequent lack of incentive on his part to put his best exertion on the land and the resultant loss to the state in the shape of revenue as well as the rise of a contented peasantry were exactly parallel to the situation which faced the ruler of Travancore leading to the proclamation of 1865. It was in these circumstances that the ruler of Cochin issued a proclamation on March 10, 1905, which defined with precision the rights of the State and of the cultivator in regard to these lands and it is the submission of the learned Attorney General that the effect of this proclamation is to render the Pandaravaka and Puravaka lands held by the petitioner "estates" within the meaning of article 31A(2) of the constitution as it now stands. It is therefore necessary to set out in some detail the terms of this proclamation. The preamble to the proclamation recites the fact that the State demand had not been fixed either with reference to the actual measurements of the land or on any fixed or uniform principles and that a revision of the State demand based upon a correct measurement of lands and definite principles, fair alike to the State and "our" agricultural population, is desirable in the interest of a sound revenue administration. It then proceeds to state 806 that a survey which included the demarcation, mapping and the preparation of an accurate record of titles in respect of all descriptions of properties was to be carried out and that a Settlement or revision of the State demand would be conducted in accordance with the principles laid down by the proclamation. In passing it may be mentioned that this is reminiscent of the despatches of Thomas Munro in which he expatiates upon the need of a proper survey and a correct definition of the principles upon which land revenue shall be assessed and that the quantum of revenue should be such as while providing for a fair share to the State, should leave enough for the cultivator to live upon and offer an inducement to him to increase the output of his fields in which event the surplus available to him would be more. In particular I might refer to a passage in a despatch which is extracted by Westropp, C.J., in Vykunta Bapuji vs Government of Bombay (1) reading: "When the land revenue is fixed and light, the farmer sees that he will reap the reward of his own industry: the cheerful prospect of improving his situation animates his labours, and enables him to replace in a short time the losses he may sustain from adverse seasons, the devastations of war, and other accidents. " Paragraph 5 of the proclamation directs that lands, whether wet or dry, were to be classified with reference to the nature of their soils in accordance with the table of classification prescribed in the Madras Settlement Manual which is sufficiently indicative of the close correspondence between the ryotwari system and mode of fixation of land revenue and the principles underlying it as prevailed in the neighbouring Presidency of Madras. Paragraph 6 reads: "Under the present land revenue system of the State, lands are held under two main 807 tenures, viz., Pandaravaka and Puravaka. . " At this stage it is necessary only to add that the proclamation does not deal with the rights as between the State and Jenmis, i.e., that class of land owners who were entitled to a freehold interest in the land as explained earlier. I shall deal later with special legislation with reference to Jenmis in the other princely State which is a constituent of present State of Kerala in its proper place. Paragraph 6 proceeds to enumerate the six subsidiary classifications of the Pandaravaka tenure and enumerates the Verumpattom type as the first among them and this type is taken as the standard for fixing the land revenue of the other categories which, it might be mentioned, are favourable tenants, the State demand being reduced. To these others which partake of the nature of grants of land revenue very different considerations would apply. The lands of the petitioner held on Pandaravaka tenure, it should be added fall within the sub category of Verumpattom lands. The proclamation then proceeds to state: "The revenue paid to the State varies according to the nature of the tenure, i.e., the six sub classes. It is however only the Pandaravaka Verumpattom lands which pay the full pattom or share due to the State. We have accordingly decided that the Pandaravaka Verumpattom shall be deemed as the normal tenure for settling the full State demand and that the other tenures shall be treated as favourable tenures and settled on the lines hereinafter indicated. . ." Paragraph 7, after reciting that the rates of assessment on Pandaravaka Verumpattom wet lands vary from place to place, points out that such disparity is indicative of unequal incidence and stating that it was essential that the State demand should 808 bear a fixed proportion to the produce a land is capable of yielding announces the decision that the same shall be half the net produce. The deductions to be made for ascertaining the net produce are indicated. The next clause which is of relevance and importance in the present context is cl. 13 which runs: "13. At present holders of Pandaravaka Verumpattom lands do not possess any property in the soil. As we are convinced that proprietorship in soil will induce a cultivator to improve his land and thereby add to the agricultural prosperity of the country, we hereby declare that our Verumpattom holders of lands shall, after the new Settlement has been introduced, acquire full rights to the soil of the lands they hold and that their rights shall remain undisturbed so long as they regularly pay the State revenue, provided that the rights to metals and minerals, possessed by the State in all lands under whatever tenures they are held, are reserved to the State. " Paragraph 14 onwards deal with favourable tenures and of these we are concerned only with Puravaka lands and it is pointed out in Paragraph 15 that in the case of Puravaka lands the Jenmi is recognised as owning the proprietorship in the land and is consequently entitled to share the produce with the cultivator and the Sirkar, and proceeds to define the State demand in such lands. There are other clauses dealing with other incidents in regard to these tenures and in regard to other interests in the land such as house sites etc. but we are not concerned with them. The proclamation also makes provision for the grant of rough or draft pattas to cultivators and of fair pattas detailing the assessment payable on such lands provisions exactly parallel to the practice and procedure prevailing in the adjoining area of the Madras Presidency. Besides, it also makes 809 provision against any revision of the assessment once fixed before the expiry of 30 years, also in line with the then practice in Madras. I have made this analysis of the provisions of the proclamation for the purpose of emphasizing that what the proclamation intended to achieve was the introduction of ryotwari system of settlement in the place of exactions by the State based on no principles and unrelated to the productivity of the soil and having an unequal incidence for different areas and different lands. The holder of Pandaravaka Verumpattom patta was therefore nothing more or nothing less than the holder of a ryotwari patta in the adjoining Madras State. The only point of difference that could be suggested is this. Under the ryotwari system, the proprietorship of the ryot to the soil is not in theory derived from the State, whereas under the proclamation of 1905, it appears to rest on a grant. In my opinion this makes no difference, because the essential features of the system are the same as those of ryotwari (1) a direct relationship between the State and the cultivator, and with the absence of any intermediary to intercept the raja bhagam or land revenue, (2) there is no grant or alienation of the States ' right to revenue in favour of the grantee. The Puravaka tenure was wholly different. They were lands held by Jenmis. As I shall show later, Jenmam lands were not exempt from the payment of land revenue but the Puravaka tenant had the benefit of a favourable assessment. In other words, in respect of those lands the produce of the land was the subject of sharing as between the actual cultivator, the Jenmi and the State, though the Jenmi had a freehold interest in the land itself The question for consideration now is whether the lands held under a patta by a Pandaravaka Verumpattom and of Jenmam lands by a Puravaka 810 tenant are "estates" within the meaning of article 31 A (2). Before examining the terms of article 31 A (2) as they now stand, it is necessary to refer to the antecedent history which led to the First and the Fourth Constitutional Amendments. Preliminary to this it might not be out of place to briefly explain the circumstances which necessitated the First amendment as pointing to the mischief which that amendment was designed to remedy. Very soon after independence several States initiated land reforms whose object was the elimination of the intermediaries. The Madras Legislature enacted the Madras Abolition of Estates and Conversion into Ryotwari Act, 1948, by which intermediaries in the shape of zemindars, Palayagars, Jagirdars, Inamdars and other such proprietors were eliminated and persons in actual cultivation of the lands under the zemindars were brought into direct relationship with the government by being granted ryotwari pattas in respect of their former holdings. There was similar legislation in Bihar Bihar Act 1 of 1950, as also in some of the other States of the Indian Union. The validity of the several pieces of legislation was challenged in the respective High Courts principally on the ground that the deprivation of the rights of the zamindars etc. effected by these enactments and the principles upon which the compensation payable for the deprivation was determined violated articles 14, 19 and 31 of the Constitution. The first case in which a decision was rendered by a High Court in respect of the contentions urged was by the Patna High Court in Kameshwar Singh vs State of Bihar (1) in which the petition succeeded and Bihar Abolition of Estates Act 1 of 1950 was declared unconstitutional. An appeal was preferred by the State against the judgment to this Court and it was during 811 the pendency of this appeal and with a view to validate the legislation which had been enacted in the several States and which was the subject of attack in several Courts, including this Court, that First Constitutional Amendment by which article 31A was introduced into the Constitution, was enacted. The Constitution (First Amendment) Act, 1951, received the assent of the President on June 18, 1951, but article 31A which was introduced by section 4 of this Act was expressly made retrospective from the commencement of the Constitution. As then enacted article 31A ran: "31A. Saving of laws providing for acquisition of estates: etc. (1) Notwithstanding anything in the foregoing provisions of this Part, no law providing for the acquisition by the State of any estate or of any rights therein or for 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, any provisions of this Part: 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; (b) the expression 'rights ' in relation to an estate shall include any rights vesting in a proprietor, sub proprietor, under proprietor tenure holder or other intermediary and any rights or privilege in respect of revenue. " 812 In addition the First Constitution Amendment Act also enacted by its section 5 a further provision article 31B expressly validating the several enactments of the various States which were then under challenge and which were all set out in Sch. 9 of the Constitution. From this collocation it would be seen that whereas article 31B immunised from attack all the pieces of legislation which had been enacted by June 1951, article 31A was intended to render the same types of legislation enacted in future immune from attack, provided that the enactments were reserved for the President 's assent and were assented to by him. It is with this background that one has to approach the construction of article 31A. Clause (1) of article 31A does not present any difficulty in construction with reference to the point now under discussion, because its terms are clear and apply to laws providing for "the acquisition by the State of any estate or rights therein" or "the extinguishment or modification of any such rights". The crucial words here are that the rights which are acquired, extinguished or modified are rights in or in respect of an "estate". If there had been no definition of the expression 'estate ', one might have had to look to the grammatical of literal meaning of the word, and the word might conceivably be understood as including person 's interest in landed property whatever may be the nature or extent of the interest, though the width of this meaning might be controlled by the history of the provision, the antecedent state of circumstances and the mischief which it was designed to overcome. But the enactment has not left this matter for investigation in that manner. Sub clause (2)(a) contains the definition of expression 'estate ' and sub cl. (b) of "rights in relation to an estate". It is obvious that the word 'estate ' in sub cls. (a) and (b) mean the same and is employed to designate identical types of land holding. If the expression "rights in relation to an estate" in sub cl. (b) 813 indicates that it is the "estate" or the right of the intermediary that is comprehended by the use of the words 'proprietor, sub proprietor, under proprietor, tenure holder or other intermediary", clearly the expression 'estate ' in sub cl.(a) must be understood as referring to such types of landholder. It is also worth noting that the words "shall also include any jagir, inam or muafi or other similar grant" in sub cl.(a) have their parallel in sub cl. (b) by the words "any rights or privileges in respect of land revenue. " The net result therefore was that the term 'estate ' signified the land held by an intermediary who stood between the State and the actual tiller of the soil, and also the interests of those in whose favour there had been alienation of the right to revenue, i.e., lands held on revenue free or on favourable tenures. The two sub clauses may now be further examined to determine their content and significance. Taking first sub cl. (a) it is necessary to advert to two matters: (1) the reference to the "local equivalent" of the term 'estate ' in the law existing in any local area, and (2) the denotation of the words 'the existing law in relation to land tenures in force in that area '. In regard to the 'local equivalent ' of the term 'estate ' there is one observation I desire to make. These words were not in the Bill as originally presented to Parliament and were brought in as a result of the suggestion of the Joint Select Committee to which the BIII was referred. In their report the Select Committee stated: "We have amended the definition of an 'estate ' to cover cases where the existing law relating to land tenure is in a regional language for example in Hindi or Urdu and uses the local equivalent of 'estate '. " I am far from saying that if the meaning of the expression were clear the purpose for which the words were used would determine their construction 814 but I am drawing attention to this passage from the report of the Joint Select Committee for pointing out that by the use of the expression 'local equivalent ' the central concept of an 'estate ', as would be clear from the terms of sub cl. (b), which in effect is a further definition of the term 'estate ' was not intended to be departed from. Next as to the meaning of "in the existing law in relation to land tenures". These words raise for consideration the question as to what constitutes "a land tenure". If one had to go merely by the grammatical meaning merely of 'tenure ' derived from the Latin 'tenere ' to hold, any kind of right or title by which property is held would be included, the only requirement would be that the property should be held of another. In that wide sense it would include the case of land held under an ordinary tenancy under a landlord under the Transfer of Property Act. Obviously that is not the sense in which the word is employed in the clause. It has therefore to be understood as comprehending that type of "holding" where the holder is an intermediary between the State and the tiller, or is otherwise the grantee of land revenue holding the land under a favourable tenure. If this is the essential feature of the concept of an 'estate ' under cl. (2), the expression 'land tenure ' must in the context mean the 'tenure ' under which an 'estate ' as defined is held. To read it otherwise and understand 'land tenure ' as designating any system of landholding, whether or not such system conforms to the central and essential concept of estate, would not be correct. Such an interpretation would result in anomaly that in an existing law in force in a local area which uses the word 'estate ' and includes within that definition particular tenures, only they and none also are included, but if such law does not refer to a tenure as an 'estate ' then it comprehends any 815 holding of land under Government whatever be the nature of the tenure. That would constitute a radical departure from the purpose of the First Amendment and a construction which is not compelled by the words, but on the other hand contradicted by the context and setting in which they occur. This leads me to the case where an "existing law in relation to land tenures" uses the term 'estate ' and defines it in a particular manner and that definition includes not merely the proprietary rights of intermediaries or others holding land on favourable tenures as described in sub cl. (b) but also others who hold properties in their own right and describes the land holding of these others also as 'estates '. The question would then arise whether literal effect has or has not to be given to the words 'defined as an estate under the law relating to land tenures ' occurring in sub cl. One possible view to take would be that having regard to the central concept of an 'estate ' as signifying the rights in land of an intermediary etc. , those whose rights in land did not involve any assignment of the Raja bhagam but were in direct relationship with the State and subject to the payment of the full assessment of the revenue lawfully imposed upon it, could not be termed to have an interest in an 'estate ', nor the land held by them to fall within the concept of an 'estate ' as comprehended in sub cl. The other view would be that if the operative terms of article 31A and in particular the definition of "an estate" contained in cl. (2)(a) unambiguously covered cases of non intermediaries also, effect would have to be given to the terms used for it is a cardinal rule of interpretation that the operative words of an enactment, and in this must be included the terms of the Constitution, cannot be controlled by reference to the object for which the provision was introduced where the words are unambiguous. If a law in force in any local area 816 at the commencement of the Constitution which was "a law in relation to land tenures" contained the definition of an 'estate ' then every species of land holding which fell within the definition and was comprehended by such law relating to land tenure would, for the purpose of the Constitution be comprehended within the ambit of an 'estate ' and it might be no answer in regard to any particular species of land tenure that its holder was not an intermediary. I shall have occasion to refer to the decisions which turn on this aspect of the matter a little later. Apart from the exceptional cases just now mentioned where one is faced with a definition of 'an estate ' in an existing law, I consider that the First Amendment to the Constitution did not bring within the definition of 'an estate ' the holdings of persons other than intermediaries or those who held land under grants on favourable tenures from Government Jagirdar, Inamdar, Muafidar, etc. As pointed out by Venkatarama Ayyar, J., speaking for this Court in Thakur Amar Singhji vs State of Rajasthan (1): The object of article 31A was to save legislation which was directed to the abolition of intermediaries so as to establish direct relationship between the State and the tillers of the soil. . " I shall now turn to sub cl. (b) and to the terminology employed in it to define 'rights in relation to an estate ' and examine how far this definition affects the content of cl. (a) as above explained. In the first place as already noticed, the use of the word 'estate ' in the clause serves to bring into it the concept of an 'estate ' as defined in cl. (a) pointing to the inter dependence of the two clauses necessitating their having to be read together. The second point requiring advertance is as regards the definition purporting to be inclusive and not exhaustive. The question arising therefrom may be 817 posed thus: Does the definition include any other type of interest besides those enumerated, particularly of a different nature or characteristic which could not be comprehended within the extension brought in by the words 'or other intermediary '. I am clearly of the opinion that it does not and that the word includes ' is here used in the sense of 'means and includes '. In this connection I would usefully refer to the observations of Lord Watson delivering the judgment of the Privy Council in Dilworth vs Commissioner for Land and Income Tax (1): "The word 'include ' is very generally used in interpretation clauses in order to enlarge the meaning of words or phrases occurring in the body of the statute; and when it is so used these words or phrases must be construed as comprehending not only such things as they signify according to their natural import, but also those things which the interpretation clause declares that they shall include. But the word 'include ' is susceptible of another construction, which may become imperative, if the context of the Act is sufficient to shew that it was not merely employed for the purpose of adding to the natural significance of the words or expressions defined. It may be equivalent to 'mean and include ', and in that case it may afford an exhaustive explanation of the meaning which for the purposes of the Act, must invariably be attached to these words or expressions. " If therefore the constitutional validity of a legislation extinguishing or modifying the rights either of the Pandaravaka Verumpattomdars who were in the position of a ryotwari pattadar or of the Puravaka holders who held under a Jenmi of Jenmam land had to be tested with reference to 818 article 31A as it stood when it was introduced by the First Amendment, these interests under the proclamation of 1905 would not be held to be an 'estate ' and therefore outside the scope of the protection against the guaranteed fundamental rights. Before examining the effect of the change introduced by the Fourth Amendment to article 31A it might be useful to detail the circumstances which put these tenures outside article 31A under the First Constitution Amendment. Taking the Puravaka tenure first, it ought to be mentioned that as would be seen from the terms of the proclamation of 1905 extracted earlier, Puravaka lands were those in the ownership of the Jenmi but in respect of which he was not directly in cultivation. The Jenmi was considered an absolute proprietor not merely of lands which were cultivated but unlike the ryotwari pattadar also those which were not under his cultivation such as waste lands, forests, etc., and he did not hold land under the State. In other words, his proprietorship to or rights over the land of which he claimed ownership was not traceable to any title derived from the State. But notwithstanding this freehold right that he claimed and enjoyed the State was entitled from the earliest times to assess his lands to land revenue. Exemption from taxation was not any essential condition of Jenmam tenure and the Jenmi was under an obligation to pay what was termed 'Raja bhagam ' which was the equivalent of the expression 'land revenue '. This incidence of Jenmam land did not therefore detract from its character of its being the private and absolute property of the Jenmi. There was legislation in Travancore as regards the liability of the Jenmi to pay the land tax or the Raja bhagam except, of course, in those cases where anr particular land was rendered tax free as a mattey of grace or concession by the ruler. The legislation started with a royal proclamation 1869 (1042 M.E.) dealing with the lands of Jenmis and their relation 819 with their tenants. This proclamation was replaced by Regulation 5 of 1071 (July 3, 1896) which continued in force with various amendments right up to the date of the Act whose validity is now impugned and is referred to in it. By these pieces of legislation the rights of the Jenmi quoad his tenants were regulated, the grounds upon which eviction would take place were laid down and the customary rights enjoyed by either party were, so, to speak, codified. I am pointing this out because the existence of a law regulating the rights of property owners and defining their rights or obligations either quoad the Government in respect of land revenue or as regards persons holding land under them did not by itself render such law one "relating to land tenure" within the meaning of article 31A(2)(a). In order to be such a law it should regulate the rights of persons holding under grants from the government of the Raja bhagom. A law defining or regulating the levy of assessment or revenue on lands held not under such grants from the State would not be such a law. It was for this reason that the interest of Jenmis and the lands owned in Jenmam right did not fall within article 31A as it stood under the First Amendment to the Constitution and which necessitated the Fourth Amendment to which I shall refer later. The position of persons holding lands on Puravaka tenure would not be different from that of the Jenmis. As the Puravaka lands were held not under the State or under a grant from it but under the Jenmis, though liable to pay Raja bhagam, they would not be 'estates '. The case of the Pandaravaka Verumpattomdars would be similar and the lands held by them would also not fall within the category of 'estate. ' This would be so because they like ryotwari pattadars held the lands for cultivation directly from the State, and were niether intermediaries nor persons 820 who held their lands on a favourable tenure as regards the payment of land revenue in other words, they were not alienees of the Raja bhagam to any extent, and were therefore not intended to be affected by the First Amendment. For this purpose it would make no difference whether the origin of the ryot 's proprietary interest in the land be traceable to the Hindu law concept of title based on occupation and cultivation or to the relinquishment by the State under the Travancore Proclamation of 1865 or even to the conferment of proprietary rights by the Cochin Proclamation of 1905. It is only necessary to add that, their being outside the ambit of article 31A(2), and this would equally apply to the interest of the Jenmi, was not due to their tenure not being regulated by enacted law, as distinct from regulation either by the common law of by departmental instructions in the shape of the Standing Orders of the Board of Revenue or other similar bodies. The point next to be considered is regarding the effect of the change brought about by the Fourth Amendment in 1955 which on its terms was also to have retrospective effect from the commencement of the Constitution. Clause 3 of the Act which was substituted for the original cl. 1 of article 31A, provides for various types of legislation interfering with property rights, but in respect of the matter now in question the words in the original cl. 1 referring to "a law providing for the acquisition by the State of an estate of an any rights therein or the extinguishment or modification of any such rights" were left untouched. In regard to the definition of an "estate" contained in cl. 2 the only change effected in sub cl. (a) was the addition of the words "in the States of Madras and Travancore & cochin any Janmam right" after the word "grant" in the clause as it stood and in sub cl. (b) the addition of the words "ryot and under ryot" 821 after the word "tenure holder" in the original clause. After the amendment, the relevant words in article 31A read as follow: "(I) 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 abridges any of the rights 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 and in the Sates of Madras and Kerala, any Janman right; (b) the expression 'rights ' in relation to an estate, shall include any rights vesting in a proprietor, sub proprietor, under proprietor, tenure holder, raiyat, under raiyat or other intermediary and any rights or privileges in respect of land revenue. " It is not open to dispute that if the words of the statute are clear their import or content cannot be modified or varied either by way of extension or of 822 diminution by reference to the presumed intention gatherable from the statement of objects and reasons to which I shall refer presently, for it is the enacted words that constitute the record of the intention of the legislature and where this is clear any extrinsic aid is forbidden. Now let us look at the definition of an "estate" in sub cl.(a) where in express terms the lands held by a Jenmi are deemed to be a part of an estate. The words that precede the newly introduced words still retain their original form, with the result that they continue to connot the same idea and their content remains unaltered. The result of this would be that to the class of the lands of proprietors who were intermediaries and of others holding on favourable tenures which was designated as an "estate" under the First Constitutional Amendment, Jenmi lands were by specific ad hoc addition included. If therefore the holding of a ryotwari proprietor was not comprehended within the definition of an estate, the same cannot be included by reason of Jenmi lands being brought in. The argument that a raiyatwari holding has merely by the inclusion of the Jenmi become an "estate" would require the entire clause to be rewritten so as to make it read as embracing all lands which are subject to payment of land revenue to government. I consider this contention so unreasonable and unrelated to the language used in the clause as not to deserve serious consideration. Proceeding next to sub cl. (b), I must point out that it was on the introduction into it of the words 'raiyat and under raiyat ' that almost the entire argument on behalf of the respondent was rested. It is therefore necessary to scrutinize carefully the effect of these words. There is no doubt that if the words 'raiyat and under raiyat ' had been introduced in sub cl.(b) as an independent category of persons whose interests were intended to be covered by the definition, just as the lands held by Jenmis were brought into sub cl. (a) then the words 823 of the definition would have to be given full effect and the expression 'raiyat and under raiyat ' receive the construction urged before us by the respondent. But they are, however, not introduced as an independent category as has been done in the case of the Jenmam right, but are wedged in the midst of the enumeration of the several types of tenures in estates such as those of proprietor, sub proprietor under proprietor and tenure holder persons deriving their title to the interest held by them either under grants by a sovereign or under a title derived from grantees from government, the clause continuing to be wound up by a reference to "other intermediaries". As regards this a few observations may pertinently be made. The first is that even after the Fourth Amendment, "the rights vesting in a proprietor" etc. still continue to be a definition of "rights in relation to an estate" and if the word 'estate ' in cl. (b) has to be read in the light of the definition of that word in cl.(a) no interest other than one in the estate of an intermediary or of a grantee on a favourable tenure and other than one in the estate of a Jenmi would be covered by sub cl.(b). (2) I have already had occasion to point out that raiyats in proprietary estates like those of zamindars etc. did not claim title to hold their lands from the proprietor but according to law, as understood their rights even preceded that of the proprietor, i.e., the rights vested in them even before their proprietor. The interest of such raiyats cannot therefore be comprehended within the expression 'rights in relation to an estate ' which as ordinarily understood would mean 'rights created in an estate or held under the proprietor '. Undoubtedly, the words 'raiyat and under raiyat ' introduced by the Fourth Amendment would comprehend this class of raiyats because they were raiyats in an estate as defined in sub cl.(a). I am pointing this out for the purpose of showing that it is not as if the words 'raiyat and under raiyat ' would be without any 824 meaning if they were not taken to extend to the interest of every raiyatwari proprietor having, direct relationship with the State. In this connection the decision in this Court in The State of Bihar vs Rameshwar Pratap Narain Singh (1) is very relevant. The point in controversy before the Court was this. Under the Bihar Land Reforms Act (1 of 1950), the ex intermediaries were conferred a ryoti interest in certain types of land previously held by them as proprietors. As owners of these lands they had been holding melas in some places on these lands and were deriving considerable income therefrom. By the Bihar Land Reforms Amendment Act of 1959, their right to hold melas was taken away and it was the validity of this enactment that was challenged in the case. It was urged on their behalf that when the land holders were converted into raiyats, they were entitled to hold melas as an incident of their rights as raiyats and that this could not be adversely affected by State legislation without the same standing the test of scrutiny under articles 19, 31 etc. of the Constitution. The State of Bihar which was the respondent in the Writ Petition sought the protection of article 31A of the Constitution as amended by the Fourth Amendment. Dealing with the meaning of the words the 'raiyat and under raiyat ' in article 31A(2)(b) this Court said: "It is reasonable to think that the word 'raiyat ' was used in its ordinary well accepted sense, of the person who holds the land under the proprietor or a tenure holder for the purpose of cultivation, and the word 'under raiyat ' used in the equally well accepted and oridinary sense of a person who holds land under a raiyat for the purpose of cultivation". and speaking of the purpose of the Fourth Amendment it was observed: 825 "At that time laws had already been passed in most of the States for the acquisition of the rights of intermediaries in the estates; rights of raiyats or under raiyats who might answer the description 'intermediary ' were also within the definition because of the use of the word 'or other intermediary '. The only reason for specifically including the rights of 'raiyats ' and 'under raiyats ' in the definition could therefore be to extend the protection of article 31A to laws providing for acquisition by the State Governments of rights of these 'raiyats ' or 'under raiyats '. In the circumstances and in the particular setting in which the words 'raiyat ' or 'under raiyat ' were introduced into the definition, in must be held that the words 'or other intermediary 'occurring at the end, do not qualify or colour the meaning to be attached to the tenures newly added". In other words, the decision was that the object achieved by the Fourth Amendment by the introduction of these two words in sub cl. (b) was to rope in the interests of 'raiyats ' and 'under raiyats ' in 'estates ', notwithstanding that the ryot might not derive his interest, in his holding from the proprietor. The lands held by a ryotwari proprietor other than those in 'estates 'would not be an 'estate ' within sub cl. (a) nor the interest of such ryot in his holding an 'interest in an estate ' within sub cl. (b) having regard to the collocation of the words which I have attempted to explain earlier. In support of the construction that the holdings of ryots were comprehended within the definition of 'estates ' in article 31A(2), to submissions were made. The first was based on the object sought to be achieved by the Fourth Constitutional Amendment Act as set out in the statement of objects and reasons of the Bill. The passage relied on reads: 826 "While the abolition of zamindaris and the numerous intermediaries between the State and the tiller of the soil has been achieved for the most part our next objectives in land reform are the fixing of limits to the extent of agricultural lands that could be held or kept by any person, the disposal of any land held in excess of the prescribed maximum and the further modification of the rights of landowners ' tenants and agricultural holders". I am unable to accept the argument that this passage can be of any assistance in the construction of cl. (a) or (b) of article 31A (2). As already pointed out, any extrinsic aid to construction can sought only when the words of the statute reasonably and properly interpreted are of ambiguous import, and the construction of the clauses now under consideration leads to no ambiguity. In the circumstances, to accept the construction contended for by respondent would be not to interpret the enacted words but to rewrite the clauses altogether. Besides, article 31A makes provision for special cases where on account of overwhelming social needs, the protection normally afforded to the citizen by the guarantee of fundamental rights is withdrawn. It would, I consider, be a proper rule of construction to interpret the terms of such a provision with strictness which would serve to preserve the area of the guaranteed freedoms from encroachment except as specially provided. In other words, if the construction of article 31A were ambiguous, the ambiguity should be resolved in favour of the citizen, so as to preserve to him the guarantee of the fundamental rights guaranteed by articles 14, 19 and 31 except where the same has been denied to him by the clear words of the Constitution. Secondly reliance was placed on three 827 decisions of this Court: Shri Ram Ram Narayan Medhi vs The State of Bombay (1), Atma Ram vs The State of Punjab (2) and Yavtamal vs State of Bombay (3). In the two reported decisions, no doubt this Court held that interests of persons similar to those of raiyatwari proprietors were comprehended within the definition of an 'estate ' within sub cl. (a) but the reasoning upon which this was rested in wholly inapplicable for resolving the controversy now before us. In the first case Sri Ram Narain Medhi vs The State of Bombay (1), the Bombay Land Revenue Code 1879 contained a definition of an 'estate ' which included not merely the estates of intermediaries such as zamindars, taluqdars and other proprietors but also an occupant, i.e., a person who held directly under the government and whose property was assessed to land revenue in full. The question however was whether the provision in article 31 A (2) (a) that the expression 'estates ' "shall have the same meaning as that expression has in the existing law relating to land tenures enforce in the area" could be read as permitting the exclusion from the definition of interests which were defined in such a law as 'estates ' on the ground that such interests were not those of an intermediary. This Court held that full effect had to be given to these words and that the definition of an 'estate ' in a pre Constitution law relating to land tenures must determine the content of that expression. It would be seen that the result would have been the same whether the case arose before or after the Fourth Amendment. The decision in Atma Ram vs The State of Punjab (2) proceeds on an identical basis and turned on the definition of an 'estate ' in the Punjab Revenue Act 17 of 1887. In this, as in the earlier case in relation to the Bombay Land Revenue Code, there could be no dispute that the enactment was a law in relation to land tenure. The only question therefore was 828 whether full effect could or ought to be given to the words of the definition, and this was answered in the affirmative. In my opinion, the learned Attorney General cannot derive any assistance from either of these decisions. In the unreported decision in Yavatmal vs The State of Bombay (1) the challenge was to the validity of a Bombay enactment of 1958 which extended the Bombay Tenancy & Agricultural Lands Act 1956 to the Vidarbha region, an enactment whose constitutional validity had been upheld by this Court in Medhi 's case. The argument before the Court was that the lands of the petitioners were not an 'estate ' and this, for the most part, was sought to be supported by the absence of any definition of the word 'estate ' in the Madhya Pradesh Land Revenue Code of 1954 which was taken to be "the existing law relating to landtenures" in the Vidarbha region. This Court accepted the submission of Counsel for the respondent that article 31A applied to and saved the legislation from being impugned under articles 14, 19 and 31 for the reason that the interest of the petitioners in that case (who were bhoomiswamis) was the local equivalent of an 'estate '. The decision, therefore, is no authority for the point now under consideration as to the proper meaning to be attached to the word 'raiyat ' and 'under raiyat ' in sub cl. (2)(b) of article 31A or as regards the effect of the Fourth Amendment to the Constitution in regard to the point now under controversy. From the foregoing it would be seen that the interests of the petitioner in the lands held by him on Puravaka tenure are within article 31A because they are lands belonging to a Jenmi and so covered by the definition of an 'estate ' as amended by virtue of the Fourth Amendment to the Constitution. With regard, however, to the Pandaravaka Verumpattom lands I am clearly of the opinion that they are not an 'estate ' and that the interests of the 829 petitioner in them do not amount to "an interest in an estate" within sub cl. (b) of article 31A(2). It would follow that the validity of the impugned Act in relation to Pandaravaka lands would have to be considered with reference to articles 14, 19 and 31. For the reasons stated in the judgment of this Court in Writ Petitions 114 and 115 which need not be repeated, I hold that the impugned Act is constitutionally in valid and cannot be applied to the Pandaravaka Verumpattom lands of the petitioner but that the petitioner would not be entitled to any relief as regards his other properties. BY COURT: In accordance with the opinion of the majority, the petition is dismissed. There will be no order as to costs. Petition dismissed.

The Kerala Agrarian Relations Bill was introduced in the Kerala Legislative Assembly on December 21, 1957, and was ultimately passed by it on June 10, 1959. It was then reserved by the Governor of the State for the assent of the President under article 200 of the Constitution of India. Meanwhile, on July 31, 1959, the President issued a proclamation under article 356 and the Assembly was dissolved. In February 1960 fresh elections took place in Kerala and on July 27,1960, the President for whose assent the Bill was pending sent it back with his message requesting the Legislative Assembly to reconsider the Bill in the light of the amendments suggested by him. On October 15, 1960, the Bill as amended in the light of the President 's recommendations was passed by the Assembly. It then received the assent of the President on January 21, 1961, and became law as the Kerala Agrarain Relations Act, 1960. The petitioner challenged the validity of the Act on the ground that the Bill which was pending before the President for his assent at the time when the Legislative Assembly was dissolved lapsed in consequence of the said dissolution and so it was not competent to the President to give his assent to a lapsed Bill with the result that the said assent and all proceedings taken subsequent to it were constitutionally invalid. ^ HELD, that the Constitution of India radically departs from the practice obtaining in the Parliament of the United Kingdom under which Bills not assented to before the dissolution of the Houses are treated as having lapsed on that event occurring. Under Act. 196 of the Constitution a Bill which is pending assent of the Governor or the President does not lapse on the dissolution of the Legislative Assembly of the State. 754 Held, further, that the consideration of the remitted Bill by the new Legislative Assembly did not violate the provisions of article 201 of the Constitution. Per Gajendragadkar, Sarkar, Wanchoo and Das Gupta, JJ. (1) Clause (5) of article 196 of the Constitution of India deals exhaustively with the circumstances under which Bills would lapse on the dissolution of the Legislative Assembly of a State, and all cases not falling within its scope are not subject to the doctrine of lapse of pending business on the dissolution of the Assembly. (2) Under articles 200 and 201 there is no time limit within which the Governor or the President should reach a decision on the Bill referred to him for his assent and those Articles do not require that the Bill which is sent back with the message of the Governor or the President should be to the same House which had considered it in the first instance. Per Ayyangar, J. (1) A Bill before the legislative Assembly of a State ceases to be pending under article 196(5) when it has passed through all the procedure prescribed for its passage through the House and has been passed by it, and is not deemed as pending before the House till the receipt of the assent of the Governor or the President as the case may be. (2) Though under article 172 each Legislative Assembly of a State is conceived of as having a life of limited duration, in article 201 the expression "The House of the Legislature" i used in the sense of a House regarded as a permanent body. Attorney General for New South Wales vs Pennie, , relied on. The Kerala Agrarian Relations Act. 1960, was enacted with the object of providing for the acquisition of certain types of agricultural lands in the State beyond the specific maximum extents laid down in the statute. The petitioner who was the owner of certain lands in Trichur of which 900 acres were classified in the land records of the State as Pandaravaka Verumpattom lands and the remaining were entered as Puravaka lands, claimed that the lands did not constitute estates under article 31A(2)(a) and, therefore, the Act was not applicable to them. His case was (1) that as regards Pandaravaka Verumpattom lands he was paying rent to the State calculated as a proportion of the gross yield of the properties, that he held the lands under the State as a tenant and that as he was not an intermediary between the State and the tiller of the soil, the lands were not an estate under cl. 2 (a) of article 31A, and (2) that the Puravaka lands were held under a Jenmi and that as they had within its scope a particular form of land holding known as kanom 755 tenancy they were outside the purview of cl. 2 (a). It was not disputed that the proclamation issued by the Ruler of Cochin on March 10, 1905, was the relevant existing law for the purpose of deciding whether the properties of the petitioner, were an estate under article 31A (2)(a). Under cl. 13 of the proclamation the holders of the Pandaravaka Verumpattom tenure acquired full rights to the soil of the lands and held them subject to the liability to pay the assessment to the State. Clause 15 provided that in the case of Puravaka Lands the Jenmi was recognised as owning proprietorship in the land and entitled to share the produce with the cultivator and the State. Held, that the lands held by the petitioner on Puravaka tenure satisfied the test as to what constituted an estate under article 31A(2)(a) of the Constitution and, therefore, the provision of the Kerala Agrarian Relations Act, 1960, were applicable to them. Held, further (Ayyangar, J., dissenting), that the basic concept of the word "estate" as used in article 31A(2)(a) of the Constitution is that the person holding the estate should be proprietor of the soil and should be in direct relationship with the State paying land revenue to it except where it is remitted in whole or in part. If a term is used or defined in any existing law in a local area which corresponds to this basic concept of estate that would be the local equivalent of the word "estate" in the area. It is not necessary that there must be an intermediary in an estate before it can be called an estate within the meaning of article 31A(2)(a). Shri Ram Ram Narain Medhi vs State of Bombay, [1959] Supp. 1 S.C.R. 489, Atma Ram vs State of Punjab, [1959] Supp. 1 S.C.R. 748, Shri Mahadeo Paikaji Kolhe Yavatmal vs State of Bombay, ; and The State of Bihar, vs Rameshwar Pratap Narain Singh, relied on. The holder of lands held on Pandaravaka Verumpattom tenure was a proprietor of the lands and held the lands subject to the liability to pay the assessment to the State and therefore, Pandaravaka Verumpattom could be regarded as a local equivalent of an estate under cl. 2(a) of article 31A. 382. Per Ayyangar, J. (1) The word "estate" in sub cls.(a) and (b) in article 31A(2) has the same meaning and signifies lands held by an intermediary who stood between the State and the actual tiller of the soil and also the interests of those in whose favour there had been alienation of the right to revenue. 756 (2) The First Amendment to the Constitution did not bring within the definition of an estate in article 31A(2)(a) the holding of persons other than intermediaries or those who held land under grants on favourable tenures from Government. (3) Lands held by a ryotwari proprietor other than those in 'estates ' would not be an estate within sub cl. (a) of article 31A(2), nor the interest of such ryot in his holding an 'interest in an estate ' within sub cl. (4) The word 'includes ' in Art 31A(2)(b) is used in the sense of 'means and includes '. (5) The holder of Pandaravaka Verumpattom tenure was in the position of a ryotwari pattadar, and, therefore, his lands were not an estate within the meaning of article 31A(2). (6) The lands held by the petitioner on Puravaka tenure were within article 31A(2) because they were lands belonging to a Jenmi and so covered by the definition of an estate as amended by virtue of the Fourth Amendment to the Constitution.

Civil Appeal Nos. 42 and 43 of 1961. Appeals by special leave from the judgments and orders dated September 7, 1960 of the Chief Commissioner, Pondicherry in Appeals Nos. 56 and 57 of 1960. WITH Petitions Nos. 297 and 298 of 1960. Petitions under article 32 of the Constitution of India for enforcement of Fundamental Rights. A. V. Viswanatha Sastri R. K. Garg, M.K. Ramamurthy, S.C. Agrawal and D. P. Singh, for the appellants/petitioners (In both the appeals and the petitions.) C. K. Daphtary, Solicitor General of India, B. Sen, B. R. L. Iyengar and T. M. Sen, for the 983 respondent No. 1 (in both the appeals) and respondents Nos. 1 and 2 (in both the petitions). A. section R. Chari, K. R. Choudhri and R. Mahalingier, for respondent No. 2 (in both the appeals). R. Gopalakrishnan, for respondent No. 3 (in both the petitions). December, 8. The Judgment of Gajendragadkar, Wanchoo and Ayyangar, JJ., was delivered by Ayyangar, J. The judgment of Sarkar and Das Gupta, JJ., was delivered by Sarkar, J. AYYANGAR, J. The two Civil Appeals are by special leave of this Court and the two Writ Petitions have been filed by the respective appellants seeking the same relief as in the appeals, the relief sought being the setting aside of orders passed by the Chief Commissioner of Pondicherry as the State Transport appellate authority (under the Motor Vehicles Act). All these four have been heard together because of a common point raised regarding the jurisdiction of this Court to entertain the appeals and the petitions. It is manifest that the preliminary point about the jurisdiction of this Court should have first to be considered before dealing with the merits of the contentions raised in the appeals and petitions. It might be convenient to state a few facts to appreciate the context in which the questions debated before us arise and the point concerned in the order now passed. Sivarama Reddiar the appellant in Civil Appeal 43 of 1961 and the petitioner in Writ Petition 298 of 1960, is a citizen of India and is engaged in the business of motor transport. By a notification dated December 27, 1958 in the Official Gazette of Pondicherry the State Transport Commission of Pondicherry invited applications for the grant of stage carriage permits to be submitted before February 27, 1959, including the route from Pondicherry to Karaikal, the latter being another 984 former French possession. In response to this notification, Sivarama Reddiar as well as one Gopal Pillai who is the second respondent to the appeal and the second respondent in the Writ Petition were two of the 19 persons who made applications for the grant of this permit to them. Before the State Transport Commission dealt with these applications, the Government of India in the exercise of its powers under section 4 of the published a notification in the Official Gazette of Pondicherry extending the provisions of the Indian as in force in Delhi to Pondicherry with effect from June 19, 1959. Rules 3(4) and 4 of this order promulgated under the provided: "3(4). Any Court, tribunal or authority required or empowered to enforce the said Act in Pondicherry may for the purpose of facilitating its application in relation to Pondicherry construe the said Act with such alteration not affecting the substance as may be necessary or proper with respect to the matter before the Court, tribunal or authority as the case may be. " Rule 4 effected a repeal of existing laws in these terms: "Repeal of existing laws: All laws in force in Pondicherry immediately before the commencement of the Order which correspond to the Act and the rules, notifications and 'Orders applied to Pondicherry by this order shall, except in so far as such laws relate to the levy of any fee, cease to have effect save as respects things done or omitted to be done before such commencement. " On July 21, 1959, the Chief Commissioner of Pondicherry, in exercise of the powers conferred on him by section 44 of the constituted a State Transport Authority for Pondicherry The 985 State Transport Authority, Pondicherry thus created, issued a notification on August 1, 1959 by which it required persons who had applied for Stage Carriage permits in response to the notification dated December 27, 1958 to furnish particulars with regard to a number of matters which were relevant for being considered for the grant of a Stage Carriage permit under the . Both the appellant petitioner Sivarama Reddiar as well as inter alia the respondent Gopal Pillai furnished the required particulars. The Particulars supplied by the parties were checked and verified by designated authorities and thereafter the State Transport Authority by an order on April 30, 1960 directed the grant of the permit to the appellant petitioner Sivarama Reddiar rejecting the claims of all others including the respondent Gopala Pillai. Though the which had been extended to Pondicherry included section 64, whereby persons aggrieved by an order of a State Transport Authority could file appeals against such order, no appellate authority had been constituted by the Chief Commissioner. This situation was remedied by a notification by the Chief Commissioner dated May 4, 1960 whereby he constituted himself under section 68 of the Act as the appellate authority for the purpose of exercising jurisdiction under section 64 thereof. Several of the aggrieved operators including Gopala Pillai preferred appeals to the Chief Commissioner. By an order dated September 5, 1960 the Chief Commissioner, Pondicherry allowed the appeal of the respondent Gopala Pillai, set aside the order of the State Transport Authority granting the permit to the appellant Sivarama Reddiar and directed that the permit for the route Pondicherry to Karaikal be issued in favour of the respondent Gopala Pillai. Writ Petition 293 of 1960 has been filed to secure the setting aside of this order of the Chief Commissioner on the ground that the order violates the fundamental rights guaranteed to the petitioner by 986 of the Constitution and Civil Appeal No. 43 of 1961 is directed to obtain the same relief. It is not necessary at this stage to set out the facts of the other appeal and petition by Masthan Sahib, because except that the route is different and so, are the grounds on which the order of the Chief Commissioner is sought to be impugned, the other material facts relevant for the consideration of the preliminary point to which we adverted are exactly the same. The preliminary objection that is raised to the entertainment of the appeal is shortly as follows: article 136 (1) of the Constitution under which the appellant has obtained special leave reads: "136 (1). Notwithstanding anything in this Chapter, the Supreme Court may, in its discretion, grant special leave to appeal from any judgment, decree, determination, sentence or order in any cause or matter passed or made by any court or tribunal in the territory of India. " In order, therefore, that this Court might have jurisdiction to entertain the appeal it is a prerequisite that the Court or tribunal from whose judgment or order the appeal is preferred should be one in the territory of India. It is urged on behalf of the respondent that Pondicherry is not part of the territory of India, with the consequence that the Chief Commissioner whose order is impugned in the appeal is not "a Court or tribunal in the territory of India. " The question thus raised is of great political and constitutional significance and it is not disputed that if this area were not part of the territory of India, this Court would have no jurisdiction in the absence of any legislation by Parliament under article 138 (1), and the Civil Appeal would have to be dismissed as incompetent. It was common ground that this was the position in regard to the maintainability of the appeal 987 but in regard to the Writ Petition Mr. Vishwanatha Shastri learned Counsel for the petitioner sought to sustain its maintainability on slightly different grounds. He invited our attention to the terms of article 12 of the Constitution which reads: "In this Part, unless the context otherwise requires, "the State" includes the Government and Parliament of India and the Government and the Legislature of each of the States and all local or other authorities within the territory of India or under the control of the Government of India." Learned Counsel pointed out that for the purpose of the exercise of this Court 's powers under article 32 of the Constitution for the enforcement of the fundamental rights its jurisdiction was not limited to the authorities functioning within the territory of India but that it extended also to the giving of directions and the issuing of orders to authorities functioning even outside the territory of India, provided that such authorities were subject to the control of the Government of India. This submission appears to us well founded and that the powers of this Court under article 32 of the Constitution are not circumscribed by any territorial limitation. It extends not merely over every authority within the territory of India but also those functioning outside provided that such authorities are under the control of the Government of India. The power conferred on this Court by Part III of the Constitution has, however, to be read in conjunction with article 142 of the Constitution which reads: "142 (1) The Supreme Court in the exercise of the jurisdiction may pass such decree or makes such order as is necessary for doing complete justice in any cause or matter pending before it, and any decree so passed or order so made shall be enforceable throughout the territory 988 of India in such manner as may be prescribed by or under any law made by Parliament and until provision in that behalf is so made, in such manner as the President may by order prescribe. (2) Subject to the provisions of any law made in this behalf by Parliament, the Supreme Court shall, as respects the whole of the territory of India, have all and every power to make any order for the purpose of securing the attendance of any person, the discovery or production of any documents, or the investigation or punishment of any contempt of itself. " It would be seen that article 142 brings in a limitation as regards the territory which the orders or directions of this Court could be enforced. It is manifest that there is an anomaly or a discordance between the powers of this Court under article 32 read with article 12 and the executability or enforceability of the orders under article 142. It is possible that this has apparently arisen because the last words of article 12 extending the jurisdiction of this Court to authorities "under the control of the Government of India" were added at a late stage of the constitution making while articles 142 and 144, the latter reading: "All authorities, civil and judicial, in the territory of India shall act in aid of the Supreme Court". were taken, in whole or in part, from section 210 of the Government of India Act, 1935 and that no necessary changes were made in article 142 to bring it into line with article 12 as it finally emerged and the powers of this Court under article 32. But this however offers us no solution to the question which is whether, in view of the limitation imposed by article 142 on the area within which alone the directions or orders of this Court could be directly 989 enforced, the Court could issue a writ in the nature of certiorari or other appropriate writ or direction to quash a quasi judicial order passed by an authority outside the territory of India, though such authority is under the control of the Government of India. If the order of the authority under the control of the Government of India but functioning outside the territory of India was of an executive or administrative nature, relief could be afforded to a petitioner under article 32 by passing suitable orders against the Government of India directing them to give effect to the decision of this Court by the exercise of their powers of control over the authority outside the territory of India. Such an order could be enforceable by virtue of article 144, as also article 142. But in a case where the order of the outside authority is of a quasi judicial nature, as in the case before us, we consider that resort to such a procedure is not possible and that if the orders or directions of this Court could not be directly enforced against the authority in Pondicherry, the order would be ineffective and the Court will not stultify itself by passing such an order. In these circumstances it becomes imperative that we should ascertain the constitutional and political status of Pondicherry in relation to the Union of India. Certain documents have been placed before us and in particular an agreement dated October 21, 1954 entered into between the Government of India and of France by which the administration of Pondicherry was ceded to the Government of India. Mr. Viswanatha Sastri learned Counsel for the appellant petitioner contended that on the terms and conditions contained in this agreement, Pondicherry was a part of the territory of India. On the other hand, Mr. Chari learned Counsel for the respondents urged that the reservations contained in the agreement were such as to preclude the Court from reaching the conclusion 990 that there had been a transfer of complete sovereignty, which according to him was necessary in order to constitute the area as part of the territory of India. The learned Solicitor General who appeared in response to the notice to the Union of India, submitted that the Union Government was agreeable to the respective contentions urged by the parties being decided by the Court. We have considered the matter urged before us with great care and desire to make the following observations: So far as the Constitution of Indian is concerned, we have an express definition of what the phrase "territory of India" means. article 1 (3) enacts: "1. (3) The territory of India shall compromise (a) the territories of the States; (b) the Union territories specified in the First Schedule; and (c) such other territories as may be acquired. " There might be little difficulty about locating the territories which are set out in cls. (a) & (b) but when one comes to (c) the question arises as to when a territory is "acquired" and what constitutes "acquisition". Having regard to the subject dealt with, the expression "acquired" should be taken to be a reference to "acquisition" as understood in Public International Law. If there were any public notification assertion or declaration by which the Government of this country had declared or treated a territory as part and parcel of the territory of India, the Courts would be bound to recognise an "acquisition" as having taken place, with the consequence that that territory would be part of the territory of the Union within Art.1(3)(c). In the present case, we have this feature that the administration of the territory is being conducted under the powers vested in the Government under the . The preamble to that Act recites that it was: 991 "An Act to provide for the exercise of certain foreign jurisdiction of the Central Government". and accordingly the expression "foreign jurisdiction" is defined in its section 2(a) to mean "the jurisdiction which the Central Government has for the time being in or in relation to any territory outside India. " Thus this would prima facie show that Pondicherry has not been "acquired" but still continues to be outside the territory of India. In our opinion, however, though this might be very strong evidence that the territory has not been "acquired" and so not part of the "territory of India", it is still not conclusive. In this state of circumstances two courses would be open to us: (1) to decide for ourselves on the material that has been placed before us in the shape of the agreement between the two Governments etc. Whether Pondicherry has been "acquired" so as to become part of the territory of India, or (2) to invoke the assistance of the Government of India by inviting them to state whether the territory has been acquired within article 1(3) of the Constitution and whether Pondicherry is thus now part of the "territory of India". We originally proposed to avail ourselves only of the procedure indicated in s.6 of the which enacts: "6. (1) If in any proceeding, civil or criminal, in a Court established in India or by the authority of the Central Government outside India, any question arises as to the existence or extent of any foreign jurisdiction of the Central Government, the Secretary to the Government of India in the appropriate department shall, on the application of the Court, ' send to the Court the decision of the Central Government on the question, and that decision shall for the purposes of the proceeding be final. 992 (2) The Court shall send to the said Secretary in a document under the seal of the Court or signed by a Judge of the Court, questions framed so as properly to raise the question, and sufficient answers to those questions shall be returned to the Court by the Secretary and those answers shall on production thereof be conclusive evidence of the matters therein contained." But the learned Solicitor General very properly pointed out that an answer to the question which could be referred under this provision would relate merely to "the existence or extent of jurisdiction" and that information on these points might not be sufficient to solve the problem posed by the preliminary question raised in the appeals and petitions as to whether Pondicherry is a part of the "territory of India" or not. We agree with the learned Solicitor General that information relating to the "existence or extent" of the jurisdiction exercisable by the Union Government in the territory might not completely solve the question for our decision as to whether Pondicherry is part of the territory of India or not, but still if the extent of the jurisdiction vested in the Union Government by the arrangements entered into between the two Governments virtually amounts to a transfer of sovereignty for every practical purpose, it would be possible to contend that such a transfer or cession was so incompatible with the existence of any practical sovereignty in the French Government as to detract from the surrender or transfer being other than complete. It is for this reason that we consider it proper to exercise the powers vested in the Court under section 6 of the . It would be observed from what has been stated above that it would be more satisfactory and more useful for the disposal of the proceedings 993 before us if we ascertain from the Union Government an answer to the question whether they do or do not consider that Pondicherry is part of the territory of India. We have only to add that on the decisions in England, the Court has jurisdiction to invite the Government to assist it by information as to whether according to Government any territory was part of Her Majesty 's Dominion or not (vide The Fagernes L. R. 1927 Probate 311). Besides, the learned Solicitor General agreed that the Government would assist us by answering our reference. In view of the matters set out above we direct that the following questions shall be forwarded to the Union of India under the seal of this Court for the submission of their answers: (1) Whether Pondicherry which was a former French Settlement is or is not at present comprised within the territory of India as specified in article 1(3) of the Constitution by virtue of the Articles of the Merger Agreement dated October 21, 1954 between the Governments of India and France and other relevant agreements, arrangements, acts and conduct of the two Governments. (2) If the answer to Question 1 is that Pondicherry is not within the territory of India, what is the extent of the jurisdiction exercised by the Union Government over the said territory and whether it extends to making all and every arrangement for its civil administration, its defence and in regard to its foreign affairs. The Government of India might also state the extent of jurisdiction which France possesses over the area and which operates as a diminution of the jurisdiction ceded to or enjoyed by the Government of India. On the receipt of the answers to these questions the appeals will be posted for further hearing. SARKAR J. Four matters came up for hearing together. Two of these are appeals brought with leave 994 granted by this Court and two are petitions under article 32 of the Constitution. One appeal and one petition are by one party and the other appeal and petition are by another. The appeal and the petition by each party challenge an order made by the Chief Commissioner of Pondicherry under the . Each of the two orders challenged was made on applications for the grant of bus permits. By one of the orders a permit for a certain route had been given to a person other than one of the parties who has moved us, in preference to him. By the other order, similarly, the claim of the other party moving us to a permit for a different route was rejected. All the matters raise substantially the same question concerning the validity of the Chief Commissioner 's orders. Now, Pondicherry was earlier a French possession administered by the Government of France. By an agreement between the Governments of India and France, the administration of Pondicherry was transferred to the Government of India as from November 1, 1954. The Government of India had been exercising power in Pondicherry since, under the . The Chief Commissioner of Pondicherry is an officer of the Government of India appointed under the powers derived as a result of the agreement. With regard to the appeals, question arose at the hearing before us as to whether they were competent. The appeals had been filed with leave granted under article 136 of the Constitution. It was said that the appeals were incompetent because Pondicherry was outside the Indian territories and under article 136 no appeal from any court outside such territories lay to this Court. It was, however, contended on behalf of the appellants that since the Indo French agreement or very soon thereafter, Pondicherry became part of the Indian territories as a territory acquired by India and, therefore the appeals who 995 competent. As the most satisfactory way of deciding the question whether Pondicherry is within India or not is to seek information from the Government on the point, the majority of the members of the bench are of opinion that the Government of India should be approached to enlighten us about it. The learned Solicitor General, appearing for the Government, has not objected to this procedure being adopted. With regard to the Petitions under article 32, it was contended that the Chief Commissioner of Pondicherry was a State within the meaning of article 12 of the Constitution as under that article any authority under the control of the Government of India outside the territory of India was a State for the purpose of Part III of the Constitution. On this basis it was contended on behalf of the petitioners that the petitions under article 32 asking for certain writs to quash the orders of the Chief Commissioner of Pondicherry were also competent. A further question then arises as to whether in view of article 142 of the Constitution the writs, if issued, could be enforced against an authority under the control of Government of India at Pondicherry, if Pondicherry was outside India and if they could not, whether the Court should issue the writs as it would only be stultifying itself by doing so. It seems to us that it is unnecessary to decide these questions at this stage, for we are going to ask the Government to inform us whether Pondicherry was at the relevant time part of Indian territories. If the Government inform us that Pondicherry was part of India, then no question would arise concerning the powers or jurisdiction of this court in any of the matters now before us. If the information from the Government is that Pondicherry is not within the territories of India, that will, in our opinion, be the 996 proper time to consider whether the Court can still give the petitioners the relief which they ask. These cases involve other questions of difficulty and importance on which it would be proper, in our view, to make a pronouncement after the Government of India 's answer to our request is received. As to none of these are indeed any question arising in these cases we express any opinion at this stage. We wish, however, to observe now that it seems to us exceedingly strange that if this Court finds that a party 's fundamental right has been violated, from which it would follow that that party has a right to move this Court under article 32 and to obtain the necessary writ, this Court could refuse to issue it for the reason that it would thereby be stultifying itself. If a party is entitled to a writ under article 32, then we are not aware that there is any discretion in the Court to refuse the writ on the ground that the writ cannot be enforced. Even assuming that in view of article 142 of the Constitution, a writ cannot be enforced outside India as to which we pronounce no opinion now might is not be said with justification that it is not necessary for us to be unduly pressed by considerations of the difficulties of the enforcement of the writ and that if would be reasonable for us to think that the Government of India has sufficient respect for this Court to do all that is in its power to give effect to this Court 's order, whether or not there might be technical difficulties in the way of its enforcement by this Court. In view of these doubts, we are unable, as at present advised, to concur in the opinion expressed in the Judgment of the majority of the learned Judges constituting the Bench that article 142 stands in the way of this Court issuing a writ under article 32 in this case. We would reserve our opinion till a later stage and till it becomes necessary to express any opinion at all. 997 BY COURT : We direct that the two questions set out in the majority judgment be forwarded to the Union of India under the seal of this Court for submission of their answers. On receipt of the answers to the questions the appeals will be posted for further hearing. The Judgment of Gajendragadkar, Wanchoo and Ayyangar, JJ., was delivered by Ayyangar J. The Judgment of Sarkar and Das Gupta, JJ., was delivered by Sarkar J. AYYANGAR, J. In compliance with our directions the two questions were forwarded to the Union Government and they submitted their answers to them in the following terms: "Question No. (1) Whether Pondicherry which was a former French Settlement is or is not at present comprised within the territory India as specified in Article 1(3) of the Constitution by virtue of the Articles of the Merger Agreement dated October 21, 1954 between the Governments of India and France and other relevant agreements arrangements, acts and conduct of the two Governments. Answer The French Settlement (Establishment) of Pondicherry is at present not comprised within the territory of India as specified in clause (3) of Article 1 of the Constitution by virtue of the Agreement dated the 21st October, 1954, made between the Government of France and the Government of India or by any other agreement or arrangement. By the aforesaid Agreement, dated the 21st October, 1954, the Government of France transferred, and the Government of India took over, administration of the territory of all the French Establishments in India, including Pondicherry, with effect from the 1st November, 1954. A copy of the Agreement is enclosed. This is expressed to be a de facto transfer and was intended to be 998 followed up by a de jure transfer. A treaty of Cession providing for de jure transfer has been signed by the Government of France and the Government of India on the 28th May, 1956, but has not been so far ratified in accordance with the French Law as well as in accordance with the article 31 of the Treaty. A copy of the Treaty is also enclosed. The Government of India has been administering Pondicherry under the , on the basis that it is outside India and does not form part of the territory of India. Question No.(2) If the answer to question 1 is that Pondicherry is not within the territory of India, what is the extent of the jurisdiction exercised by the Union Government over the said territory and whether it extends to making all and every arrangement for its civil administration, its defence and in regard to its foreign affairs. The Government of India might also state the extent of jurisdiction which France possesses over the area and which operates as a diminution of the jurisdiction ceded to or enjoyed by the Government of India. Answer The Government of India has been exercising full jurisdiction over Pondicherry in executive, legislative and judicial matters in accordance with . In doing so it has followed the aforesaid Agreement. The Government of France has not also exercised any executive, legislative or judicial authority since the said Agreement. The jurisdiction of the Government of India over Pondicherry extends to making all arrangements for its civil administration. The administration of the territory is being carried on under the , and in accordance with the French Establishments (Administration) Order, 1954, 999 and other Orders made under sections 3 and 4 of that Act. The Government of India have been aiming at conducting the administration of Pondicherry so as to conform to the pattern of administration obtaining to in India consistent with the said Agreement. Accordingly a large number of Acts in force in India have already been extended to Pondicherry. The Government of India hold the view that the sole responsibility in regard to arrangements for the defence of Pondicherry devolves on themselves. Pondicherry has no foreign relations of its own. No claims have been made by the Government of France in this matter nor have the Government of India recognized the existence of any such claim. The Government of France do not possess any de facto jurisdiction over Pondicherry which would imply any diminution of the jurisdiction exercised by the Government of India. " The appeals and the writ petitions were thereafter posted for further hearing before us on October 9, 1961. Mr. N. C. Chatterji learned Counsel for Shri Masthan Sahib, appellant in Civil Appeal No. 42 of 1961 and petitioner in writ petition No. 297 of 1960, urged before us two contentions. The first was that the answer to the second question clearly established that the French establishments including Pondicherry were part of the territory of India, having been acquired by the Union Government within the meaning of article 1(3)(c) and that in view of this position it was not necessary to consider nor proper for us to accept the views expressed by the Union Government in their answer to the first question wherein they had expressly stated that they did not consider the French "establishments" covered by the agreement between the Union Government and the Government of France dated October 21, 1954 as being within the territory of India within 1000 Art.1(3) of the Constitution of India. Secondly, a point which was necessarily involved in the first one just set out that this Court was not bound by the statement of the Government of India in its answer to Question No. 1 and that it should disregard such an answer and investigate for itself on the materials placed before it as to whether Pondicherry was part of the territory of India or not. In support of the first submission Mr. Chatterji placed considerable reliance on the passage in our judgment rendered on April 28, 1961 reading: "Still if the extent of the jurisdiction vested in the Union Government by the arrangements entered into between the two Governments virtually amounts to a transfer of sovereignty for every practical purpose, it would be possible to contend that such a transfer or cession was so incompatible with the existence of any practical sovereignty in the French Government as to detract from the surrender or transfer being other than complete. " The argument was that the answer to the second question showed (1) positively that the Government of India exercised complete jurisdiction over the territory executive, legislative and judicial, its authority being plenary and extending to the making of laws. Their execution and the administration of justice with complete power over its defence and foreign affairs and (2) negatively that the Government of France possessed no authority in the territory, so much so that it could not be predicated that there had been any retention of even a vestigial sovereignty to detract from the completeness of the transfer. In the circumstances, learned Counsel urged that he was justified in inviting us to ignore or disregard the answer to the first question and instead answer the question as to whether these French establishments were within the territory of India or not on the basis of the second question. 1001 Having regard to the nature of this argument it is necessary to state briefly the circumstances in which we felt it necessary to frame the two questions that we did. At the stage of the hearing of the petitions on the first occasion, notice was issued to the Union Government and the learned Solicitor General appearing in response to the notice did not convey to us any definite views on the part of the Government as to whether Pondicherry was or was not considered by them to be part of the territory of India but invited the Court to decide the question on the materials that might be placed the parties before us. At that stage therefore we were not quite certain whether Government would be prepared to make a formal statement about their views on this question. If therefore the Government were inclined still to leave the matter to the Court, we desired to have complete information as to the factual position regarding the government of the territory. It was in view of that possibility that Question No. 2 was framed. It was, of course, possible that Government might communicate their views to the Court and with a view to enable this to be done we framed Question No. 1. In these circumstances nothing is gained by reference to the passage in our judgment dated April 28, 1961. The passage extracted is certainly not an authority for the position as to whether if Question No. 1 was answered, the Court could properly consider any implications or inferences arising on the answer to Question No. 2. We shall therefore proceed to consider the principal question that arises at this stage, viz., whether the answer of the Government is reply to a specific and formal enquiry by the Court that it did not consider a particular area to have been "acquired" by the Indian Government and therefore not a part of the territory of India was binding on the Court or not. A number of decisions of the English and Australian Courts in which the point 1002 has been considered were placed before us and we shall proceed to refer to the more important of them. In Duff Development Company vs Government of Kelantan(1) the question related as to whether the Sultan of Kelantan was the ruler of an independent sovereign State, such that the Courts in England had no jurisdiction over the Sultan or the Government of that State. The Secretary of State for the Colonies who was requested by the Court to furnish information as regards the status of the ruler and of the Government stated that the Sultan was the head of an independent sovereign state. The binding character of this statement was however questioned and it was argued before the House of Lords on foot of certain public documents that Kelantan was merely a dependency of the British Government and not a sovereign State. On the other side; it was pressed upon the House, that the statement of the Secretary of State was binding and this latter submission was unanimously accepted by the House. In doing so Viscount Cave observed: "If after this definite statement a different view were taken by a British Court, an undesirable conflict might arise; and in my opinion it is the duty of the Court to accept the statement of the Secretary of State thus clearly and positively made as conclusive upon the point." Viscount Finlay expressed himself thus: "It has long been settled that on any question of the status of any foreign power course is that the Court should apply to His Majesty 's Government, and that in any such matter it is bound to act on the information given to them through the proper department. Such information is not in the nature of 1003 evidence; it is a statement by the Sovereign of this country through one of his Ministers upon a matter which is peculiarly within his cognizance." Lord Sumner said: "Where such a statement is forthcoming no other evidence is admissible or needed. " There is one other decision of the House of Lord to which reference may usefully be made Government of the Republic of Spain vs Arantzazu, Mendi.(1) The question for decision was whether it was General Franco 's Government that was the Government in Spain or the Republican Government. The Secretary of State for Foreign Affairs had, in a formal communication to the Court in reply to a letter forwarded under the direction of Bucknill J., stated that His Majesty 's Government had recognised the Nationalist Government as the Government which had administrative control over a large portion of Spain and particularly over the Basque Provinces wherein the ship, title to which was in question, had been registered. Lord Wright in his speech said: "The Court is, in my opinion, bound without any qualification by the statement of the Foreign office, which is the organ of His Majesty 's Government for this purpose in a matter of this nature. Such a statement is a statement of fact, the contents of which are not open to be discussed by the Court on grounds of law. " No doubt, these decisions were in relation to the status of or recognition by the Government of foreign sovereign and are therefore not ad idem with the point which now arises for consideration viz., whether a particular piece of territory is or is not part of the territory of India. A statement by Government in relation to a similar question 1004 came up before the Court of Appeal in Fagernes (1) The question for the Court 's consideration was whether the Bristol Channel, particularly at the point where a collision was stated to have taken place, was or was not part of British territory. Hill J. before whom an action for damage caused by the alleged collision came up held that the waters of the Bristol Channel were part of British territory and therefore within the jurisdiction of the High Court. The defendants appealed to the Court of Appeal and at that stage the Attorney General appeared and in response to a formal enquiry by the Court as to whether the place where the collision was stated to have occurred was within the realm of England, replied that "the spot where the collision is alleged to have occurred is not within the limits to which the territorial sovereignty of His Majesty extends." On the basis of this statement the Court of Appeal unanimously reversed the judgment of Hill J. An argument was raised before the Court as regards the binding character of the statement by the Attorney General and in regard to this Akin L.J. said: "I consider that statement binds the Court, and constrains it to decide that this portion of the Bristol Channel is not within British jurisdiction, and that the appeal must be allowed. I think that it is desirable to make it clear that this is not a decision on a point of law, and that no responsibility rests upon this Court save that of treating the statement of the Crown by its proper officer as conclusive." Lawrence L.J. observed: "It is the duty of the Court to take judicial cognizance of the extent of the King 's territory and, if the Court itself is unacquainted with the fact whether a particular place is or is not within the King 's territory, the Court is entitled to inform itself of that fact by making 1005 such inquiry as, it considers proper. As it is highly expedient, if not essential, that in a matter of this kind the Courts, of the King should act in unison with the Government of the King, this Court invited the Attorney General to attend at the hearing of the appeal and at the conclusion of the arguments asked him whether the Crown claimed that the spot where the collision occurred was within the territory of the King. The Attorney General in answer to this inquiry, stated that he had communicated with the Secretary of State for Home Affairs, who had instructed him to inform the Court that "the spot where this collision is alleged to have occurred is not within the limits to which the territorial sovereignty of His Majesty extends. " In view of this answer, given with the authority of the Home Secretary upon a matter which is peculiarly within the cognizance of the Home office, this Court could not, in my opinion, properly do otherwise than hold that the alleged tort was not committed within the jurisdiction of the High Court". Bankes L.J., though he agreed with his colleagues in allowing the appeal, however struck a slightly different note saying: "This information was given at the instance of the Court, and for the information of the Court. Given under such circumstances, and on such a subject, it does not in my opinion necessarily bind the Court in the sense that it is under an obligation to accept it" The entire matter is thus summarised in Halsbury 's Laws of England, Third Edition, Volume 7: "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 1006 the government, of which the following are examples: (1) . . . . . . . . . (2) Whether a particular territory is hostile or foreign, or within the boundaries of a particular state." Mr. Chatterji, however, invited our attention to certain observations contained in two decisions of the High Court of Australia Jolley vs Mainka and Frost vs Stevenson (2).In both these cases the point involved was as to the status of the territory of New Guinea which Australia was administering as mandatory territory under a mandate from the League of Nations. There are, no doubt, observations in these cases dealing with the meaning of the word 'acquired ' in section 122 of the Commonwealth of Australia Act, but the point to be noticed however is that there was no statement by the Government of the Commonwealth of Australia as to whether this area was or was not part of the territory of Australia, such as we have in the present case. We do not, therefore, consider that these observations afford us any assistance for the solution of the question before us. Both Mr. Chatterji and Mr. Viswanatha Sastri learned Counsel who appeared for Sivarama Reddiar, the appellant and petitioner in the other cases, stressed the fact that what we were called upon to decide was the meaning of the expression 'acquired ' in article 1 (3) (c) of the Constitution and that in the case of a written constitution such as we had to construe, jurisdiction of this Court was not to be cut down and the enquiry by it limited by reasons of principles accepted in other jurisdictions. In particular, learned Counsel stressed the fact that it would not be 1007 proper for the Court to ignore patent facts and hold itself bound by the statement of Government in cases where, for instance, the Government of the day for reasons of its own desiring to exclude the jurisdiction of this Court denied that a part of territory which patently was within article 1(3) was within it. It is not necessary for us to examine what the position would be in the contingency visualized, but assuredly it is not suggested that the case before us falls within that category. The proposition laid down in the English decisions that a conflict is not to be envisaged between the Executive Government and the judiciary appears to us to rest on sound reasoning and except possibly in the extreme cases referred to by the learned Counsel, the statement of the Government must be held binding on the Court and to be given effect to by it. There is one other matter which was specially pressed upon us during the course of argument to which is necessary to refer. The submission was that the answer by the Union Government to the two questions were really contradictory and that whereas the answer to the second question made it out that the French establishments had been acquired and were part of the territory of India, the Government had in relation to the first question made a contradictory answer. We do not consider this argument well founded. In cases where the only fact available is the de facto exercise of complete sovereignty by one State in a particular area, the sovereignty of that State over that area and the area being regarded as part of the territory of that State would prima facie follow. But this would apply normally only to cases where sovereignty and control was exercised by unilateral action. Where however the exercise of power and authority and the right to administer is referable to an agreement between two States, the question whether the territory has become integrated with and become part 1008 of the territory of the State exercising de facts control depends wholly on the terms upon which the new Government was invited or permitted to exercise such control and authority. If the instruments evidencing such agreements negatived the implication arising from the factual exercise of Governmental authority then it would not follow that there is an integration of the territory with that of the administering power and that is precisely what has happened in the present case. As annexures to their reply the Union Government have included The Treaty of Cession dated May 28, 1956, which is a sequel to the agreement dated October 21, 1954, transferring the powers of the Government of the French Republic to the Government of the Indian Union. Under the terms, this Treaty would become operative and full sovereignty as regards the territory of the establishments of Pondicherry, Karikal, Maha and Yanam would be ceded to the Indian Government only when the treaty comes into force. It is not necessary to refer to all the clauses of this Treaty except the one which stipulates that it would come into force on the day of ratification by the two Governments concerned. According to the Constitution of France an Act of the France Assembly is required for the validity of a Treaty relating to or involving the cession of French territory. It is common ground that the Treaty has not been ratified yet. The resulting position therefore is that by the agreement dated October 21,1954, though complete administrative control has been transferred to the Government of India, this transfer of control cannot be equated to a transfer of territory, that being the common intention of the parties to that agreement. Unless a ratification takes place there would legally be no transfer of territory and without a transfer of territory there would not be in the circumstances an "acquisition of territory", with the consequence that at present Pondicherry has to be treated as not part 1009 of the territory of India. It is unnecessary to consider what the position would have been if the Union Government had, notwithstanding the terms of the Treaty, treated the former French establishments as having become part of the territory of India. There was one minor submission made by Mr. Viswanatha Sastri to which a passing reference may be made. He suggested that the term "territory of India" in article 142 might not represent the same concept as 'the territory of India ' within article 1(3) and that in the context of article 142 the term 'territory of India might include every territory over which the Government of the Union exercised de facto control. We are not impressed by this argument. The term 'territory of India ' has been used in several Articles of the Constitution and we are clearly of the opinion that in every Article where this phraseology is employed it means the territory of India for the time being as falls within article 1(3) and that the phrase cannot mean different territories in different Articles. We have already dealt with the question as to what the effect on the maintainability of the appeals and the petitions would be if Pondicherry were not part of the territory of India. In view of Pondicherry not being within the territory of India we hold that this Court has no jurisdiction to entertain the appeals. The appeals therefore fail and are dismissed. The writ Petitions must also fail and be dismissed for the reason that having regard to the nature of the relief sought and the authority against whose orders relief is claimed they too must fail. They are also dismissed. We would add that these dismissals would not include the petitioners from approaching this Court if so desired, in the event of Pondicherry becoming part of the territory of India. In the peculiar circumstances of this case we direct that that the parties bear their respective costs. 1010 Before leaving this case, we desire to point out that the situation created by the French establishments not being part of the territory of India is somewhat anomalous. Thier administration is being conducted by the extension of enactments in India by virtue of the power conferred by the . We have had occasion to point out that though technically the areas are not part of Indian territory, they are governed practically as part of India. But so far as the orders of the courts and other authorities judicial and quasi judicial within that area are concerned, the Superior Courts in India have not, subject to what we have stated as regards the limited jurisdiction of the court, any appellate or revisional jurisdiction over them and this might in a large number of cases lead to injustice and a sense of grievance. There is enough power in Government even at the stage of the de facto transfer to remedy the situation. By appropriate action under the , or by Parliamentary Legislation under the entry 'Foreign Jurisdiction ' the appellate Jurisdiction of the High Court or of this Court could be enlarged under articles 225 and 138 [1] respectively so as to afford an adequate remedy for the inhabitants of these areas. To this aspect of the matter we consider that the attention of Government should be drawn. SARKAR, J. On the earlier occasion when these cases came up before this Court, we postponed further hearing of them till we received the answers of the Government of India to two questions which we then referred to it. These questions substantially were, (a) whether Pondicherry is or is not within the territories of India and (b) if it is not, the extent of the jurisdiction exercised by the Union Government over it and the jurisdiction which France still possesses in regard to it. These questions were put because considerable doubt was felt as to the real status of Pondicherry. If it 1011 was a foreign territory, no appeal could lie to this Court under article 136 of the Constitution from any tribunal in Pondicherry and two of these matters were such appeals. The other two matters were petitions asking for writs against certain authorities in Pondicherry and the majority held that no writ could issue to a foreign territory in view of article 142 of the Constitution and therefore for the purposes of these petitions also it was necessary to ascertain the status of pondicherry. We however then felt some difficulty about the question whether we could refuse to issue writs to an officer of the Government of India outside the territory of India and expressed our inability to concur in the opinion of the majority. We said that the proper time to discuss that question would be when on receipt of the Government 's answers to our questions, it had to be held that Pondicherry was a foreign territory and reserved our final decision on the question till then. The Government 's answers to our questions have now been received. On the basis of these answers, for the reasons hereafter mentioned, it has to be held that Pondicherry is a foreign territory. We, therefore, now wish to say a few words on the question on which we reserved our opinion on the former occasion. The opinion of the majority no doubt prevails in spite of what we shall say. Before we discuss the question which we reserved we desire to observe in regard to the appeals that it must be held that they are not maintainable as Pondicherry is a foreign territory. Now, the writs are sought to quash the orders of a quasi judicial authority functioning in Pondicherry on the ground that they violate certain fundamental rights of the petitioners This authority however is an officer of the Government of India. How far writs can be issued under article 32 of the Constitution of India to quash a quasi judicial order even if made in India, itself a 1012 question of considerable difficulty on which there has been a difference of opinion in this Court. That question was recently discussed before another Bench but the judgment in that case has not yet been delivered. For the present purpose however we will assume that writs can be issued under article 32 to quash a quasi judicial order. The First observation that we wish to make is that it has now been finally held by this Court, dealing with an application under article 32 that "the right to move this Court by appropriate proceedings for the enforcement of the rights conferred by Part III of the Constitution is itself a guaranteed right": Kavalannara Kottarthill Kochunni vs The State of Madras. (1) A right to move this Court by a petition under article 32 is, therefore, a fundamental right. That being so, a right to obtain a writ when the petition establishes a case for it, must equally be a fundamental right. For, it would be idle to give a fundamental right to move this Court and not a similar right to the writ the issue of which the petition might clearly justify. If then a fundamental right to a writ is established, and that is the assumption on which we are examining the present question the party who establishes such right must be entitled ex debito justitiae to the issue of the necessary writ. There would then be no power in the Court to refuse in its discretion to issue it. But it is said that if a writ was issued in the present case, it could not in view of article 142 which says that an order of this Court shall be enforced throughout the territory of India, be enforced Pondicherry. Let us assume that is so. Then it is said that if the Court were to issue the writ it would only be stultifying itself and should not therefore issue it. We are unable to accede to this contention. If a party has been given by the 1013 Constitution a fundamental right to a writ, there is no power in the Court to refuse that right. Supposed practical considerations of incapacity to in force the writ issued cannot be allowed to defeat the provisions of the Constitution. No authority has been cited to us in support of the proposition that when a party in entitled as of right to an order, a court can refuse to make that order on the ground that it would thereby be stultifying itself. So far as we have been able to ascertain orders are refused on this ground when the matter is one for the discretion of the Court. Such cases have, for instance, frequently occurred in proceedings relating to the issue of injunctions, to grant or not to grant which is well known, in the discretion of the Court. The discretion has no doubt to be judicially exercised as indeed all discretions have, but none the less the right to the relief is in the discretion of the Court as opposed to a relief to which a party is entitled ex debito justitiae, a distinction which is well understood. Thus, dealing with a case of the issue of an injunction restraining a person from. proceeding with an action in a foreign court, Jessel M.R. Observed, in In re International Pulp and Paper Co. Ltd.(1), "Therefore, as to a purely foreign country, it is of no use asking for an order, because the order cannot be enforced". Take another case. In England an information in the nature of quo warranto is not issued as a matter of course as a matter of course [R.V. Stacey and therefore the courts there refused to issue it when in information would be futile in its results. Halsbary Laws of England (3rd ed.) Vol. 11 p. 148. So in Reg. v Fox(2) the Court refused to issue the information for the reason that the person sought to be removed by it could be reappointed at once. These however are cases in which a Court would be inclined not to make 1014 a discretionary order on the ground that the Court would thereby be stultifying itself. Instances might be multiplied but it is unnecessary to do so. We do not think that the principle of these cases can be applied where a court has no option but to make the order which we think is the present case. It would clearly be less applicable to a case like the present where, as we shall immediately show, it would be wrong to think that the order would not be carried out. Lastly, can we be certain that the Court would be stultifying itself by issuing the writ in this case ? That would be only if our order is sure to be ignored. We think that this Court would be fully justified in proceeding on the basis that any order made by it would be carried out by any officer of the Government of India to whom it is directed wherever he may be, out of respect for the Constitution and this Court and this without requiring to be forced to do so. In this connection the case of R.v. Speyer, R. vs Cassel(1) is of interest. There Speyer and Cassel had been called upon by the court by rules nisi to show cause why an information in the nature of quo warranto should not be exhibited against them to show by what authority they respectively claimed to be members of His Majesty 's Privy Council for Great Britain. Speyer and Cassel were naturalised British subjects and the question was whether under certain statutes they were not disqualified from being appointed to the Privy Council. One of the arguments on behalf of the respondents was that the court would be powerless to enforce a judgment of ouster for it could not prevent the immediate reinstatement of the names of these persons in the roll of Privy Councillors if the King though fit to alter it. The answer that Reading C.J. gave to this argument was 1015 "Although it may be interesting and useful for the purpose of testing the propositions now under consideration to assume the difficulties suggested by the Attorney General, none of them would in truth occur. This is the King 's Court; we sit here to administer justice and to interpret the laws of the realm in the King 's name. It is respectful and proper to assume that once the law is declared by a competent judicial authority it will be followed by the Crown. " The other members of the Bench also took the same view, Lush J. observing, "The consequences he suggests are argumentative and not real, and we cannot regard them as fettering the exercise of our jurisdiction". Now this was a case of a discretionary order. Even so, the Court felt that it would be wrong to stay its hand only on the ground that it could not directly enforce its order. This salutary principle has been acted upon in our country by Das J. who later became the Chief Justice of this Court, in In re Banwarilal Roy(1) There Das J. issued an information in the nature of quo warranto in spite of the fact that he could not command the Governor of Bengal to comply with his order which might therefore have become futile. We think it is a very healthy principle and should be followed. We do not think that we can allow our powers for the protection of fundamental rights to be fettered by considerations of the enforcement of orders made by us; we must assume that the authorities in Pondicherry will willingly carry out our order. We turn now to the other questions arising on the Government 's answers. Pondicherry was admittedly a French possession but under an agreement with France, the Government of India is now administering it. The Government has definitely stated that Pondicherry is not comprised 1016 within the territory of India. It has also said that it has full jurisdiction over Pondicherry under that agreement, that the liability for defence of Pondicherry is on it and that Pondicherry has no foreign relations. It has further said that France does not possess any de facto jurisdiction over Pondicherry which would imply a diminution of the jurisdiction exercised by it. It was contended that we are not bound by the Government 's answer to the first question, namely, that Pondicherry is outside India and that on the basis of the answer to the second question we should hold, in spite of the Government 's view, that Pondicherry is a part of Indian territory. It was said that since India had admittedly full jurisdiction over Pondicherry and France exercised none, it must be held the India has acquired sovereignty over it and that it had, therefore, become Indian territory by acquisition. We are entirely unable to accept this contention. We think that we are bound by the Government 's decision at least in a case where we have referred to it for our guidance. That is the view taken in England and it is a view which is based on sound principle: see Duff Development Co. vs The Govt. of Kelantan.(1) Any other view would create a chaos and we cannot be a party to it. We may say that by a treaty. as in the present case, India may acquire full jurisdiction over a foreign territory which under the same treaty may nonetheless remain a foreign territory. It was contended that this would be absolute surrender to the executive Government; that such a view would enable the Government when it so liked, to disown a territory which was patently a part of India so that it might act therein as it liked in complete disregard of the laws and without any check from any court including this Court. This contention, to use the words of Luch J. in Speyer 's case(2)is "argumentative and not real". 1017 We cannot imagine that in a democracy any Government would ever act in the way suggested and we are sure no Government of this country will ever do so. Furthermore, the contention has no foundation whatever and is wholly imaginary. It is the duty of a court to take judicial notice of the extent of the territory of its own State. Section 57 of the Evidence Act requires that. Therefore, if the fact is patent that a certain territory is within India, the courts will take judicial notice of it and there will be no occasion to refer to the Government for any information regarding it. It may however be that in certain circumstances the fact is not patent but even then it appears that it will be the duty of a court to take judicial notice and it does so by requesting the Government to enlighten it on the point. So Lawrence L. J. said in Fagernes (1), "It is the duty of the Court to take judicial cognisance of the extent of the King 's territory and, if the Court itself is unacquainted with the fact whether a particular place is or is not within the King 's territory, the Court is entitled to inform itself of that fact by making such enquiry as it considers necessary. " It is only in cases where the Court is not aware of the facts that the question of referring to the Government will arise and therefore no occasion can possible arise where the Government might have the chance of distorting a patent fact. This is all that we desire to say. As the majority of the learned Judges of the Bench have taken a different view, the order to be made will follow their decision.

The Supreme Court referred two questions to the Union Government viz (i) whether. Pondicherry was comprised within the territory of India, and (ii) if not, what was the extent of the jurisdiction exercised by the Union Government and the French Government over the territory. The answers given were that (i) Pondicherry was not comprised within the territory of India and (ii) the Union Government exercised full jurisdiction over Pondicherry and the French Government did not exercise any de facto jurisdiction over it. There was a treaty of cession between France and India in respect of Pondicherry but it had not been ratified as required by the French and Indian laws. The appellant contended that the answer of the Union Government to the second question established that Pondicherry was part of the territory of India and that the Court was not bound by the answer to the first question. ^ Held, that Pondicherry was not comprised within the territory of India as specified in article 1(3) of the Constitution. The answer of the Union Government on this question was binding on the Court. There was no conflict between the answers to the two questions. Though complete administrative control over Pondicherry had been transferred to the Government of India it could not be equated to a transfer of territory. Unless there was ratification of the Treaty there could legally be no transfer of territory. Accordingly, no appeal could be entertained by the Court under article 136 of the Constitution against the decisions of the authorities in Pondicherry. 982 Duff Development Company vs Government of Kelantan , Government of the Republic of Spain vs Arantzazu Mendi. (1939) A. C. 256 and Fagernes 1927 Probate 311, applied. Jolley vs Mainka ; and Efrost vs Slevenson; , , distinguished. Per Gajendragadkar, Wanchoo and Ayyangar, JJ. Having regard to the nature of the relief sought no writ under article 32 of the Constitution could be issued to the authorities in Pondicherry. Per Sarkar and Das Gupta, JJ The Supreme Court could issue a writ under article 32 to the quasi Judicial authorities in Pondicherry. Article 32 was a fundamental right and the right to obtain a writ was equally a fundamental right. If the Constitution gave to a party a fundamental right to a writ the Court could not refuse that right. The consideration that the writ issued may not be enforced in Pondicherry could not be allowed to defeat the provisions of the Constitution. Such a consideration is relevant only in the case of discretionary orders. K. K. Kochunni vs The State of Madras, [1959] Supp. 2 S.C.R. 316, In re International Pulp and Paper Co. Ltd., , Reg vs Fox, ; , R. vs Cassel, (1916) I K B. 595 and In re Banwarilal Roy, , referred to.

Civil Appeal No. 59 of 1961. Appeal from the judgment and decree dated March 14, 1957, of the Bombay High Court at Nagpur, in first Appeal No. 75 of 1956. N. section Bindra and R. H. Dhebar, for the appellant Frank Anathony, J. B. Dadachanji, O. C. Mathur and Ravinder Narain, for the respondent. December 12. The Judgment of the Court was delivered by 94 SARKAR, J. This is an appeal by the State of Maharashtra against the judgment of the High Court at Nagpur confirming the decree of the Additional District Judge, Nagpur, declaring that the order reverting the respondent from the rank of officiating Deputy Superintendent of Police to the rank of Inspector of Police, was illegal and void, and granting certain consequential reliefs. The judgment of the High Court and the learned Additional District Judge Seem to us to be clearly unsustainable. The Courts below held that the respondent had been reduced in rank in violation of the terms of section 240(3) of the Government of India Act, 1935, which corresponds to article 311 of the Constitution, inasmuch as he was not given an opportunity to show cause against the order proposed to be made. It is not in dispute that the opportunity has not been given. In our view, however, for reasons to be presently stated, the respondent was not entitled to that opportunity. On June 8, 1948, the respondent was holding the post of Inspector in the Central Provinces and Berar Police. Service. He was appointed to officiate as Deputy Superintendent of Police with effect from June 9,1948. On January 27, 1949, his services were lent to the Hyderabad Government in connection with the police action then being taken there. On February 5, 1949, he was sent back to the central Provinces and Berar. On February 19, 1949, the Inspector General of Police, Central Provinces and Berar, passed an order which reads as follows: "Shri F. A. Abraham (respondent) Deputy Superintendent Police, Parbhani, is reverted to rank of Inspector. " It is this order which was sought to be impugned by the respondent in the suit out of which this appeal arises. 95 After the order of reversion had been made the respondent, on February 23, 1949, asked for the reason for which he was reverted. On March 3, 1949, the Government refused to communicate the reasons to him. On May 25, 1949, a confidential memorandum was sent by the District Superintendent of Police, Parbhani, to the Deputy Inspector General of Police, Aurangabad, in which he stated that he had conducted an inquiry into certain allegations of corruption made against the respondent while he was acting in the service of the Hyderabad Government at Parbhani and he thought that those allegations were of substance. Thereupon, the Deputy Inspector General of Police, Aurangabad, held a departmental inquiry regarding these allegations and found that they had not been proved. This inquiry had been held behind the back of the respondent. Notwithstanding this, the order reverting the respondent was maintained. There is a letter addressed by the Inspector General of Police to the Chief Secretary to the Government of Madhya Pradesh, dated August 19, 1950, written after the departmental inquiry wherein it is stated that the respondents previous record was not satisfactory and that he had been promoted to officiate as Deputy Superintendent of Police as the Government was in need of officers and that he had been given a chance in the expectation that he would turn a new leaf but the complaint made in the confidential memorandum was a clear proof that the officer was habitually dishonest and did not deserve promotion. The respondent made representations to the Government to revise the order reverting him to the lower rank but the Government expressed its inability to do so. It may be stated here that on the promulgation of the Constitution the central Provinces and Berar became the State of Madhya Pradesh in the Indian Union. In the judgment under appeal the High Court followed its earlier decision in M. A. Waheed vs State 96 of Madhya Pradesh (1) in which it had been held that if a person officiating in a higher post is reverted to his original post in the normal course, that is, on account of the cessation of the vacancy or his failure to acquire the required qualification, the reversion does not amount to a reduction in rank but if he is reverted for unsatisfactory work, then the reversion amounts to reduction in rank. The High Court held that the Government 's plea that the respondent had been promoted as there was dearth of officers was an afterthought and that the fact that the respondent had been given a chance to officiate in the higher post prima facie showed that he was fit to hold that post. The High Court also held that the Government 's refusal to communicate to the respondent the reasons for his reversion or to give him the report of the inquiry, indicated that the Government was reverting him on the ground that his work was not satisfactory. It, therefore, came to the conclusion on the authority of M. A. Waheed 's case (1) that the respondent must be held to have reduced in rank and this reduction in rank was illegal as the respondent had not been given an opportunity to show cause against it. We are unable to agree with the observation in M. A. Waheed 's case(1) that when a person officiating in a post, is reverted for unsatisfactory work, that reversion amounts to a reduction in rank. A person officiating in a post has no right to hold it for all times. He may have been given the officiating post because the permanent incumbent was not available, having gone on leave or being away for some other reasons. When the permanent incumbent comes back, the person officiating is naturally reverted to his original post. This is no reduction in rank for it was the very term on which he had been given the officiating post. Again, sometimes a person is given 97 an officiating post to test his suitability to be made permanent in it later. Here again. it is an implied term of the officiating appointment that if he is found unsuitable, he would have to go back. If, therefore, the appropriate authorities find him unsuitable for the higher rank and then revert him back to his original lower rank, the action taken is in accordance with the terms on which the officiating post had been given. It is in no way a punishment and is not, therefore, a reduction in rank. It has been held by this Court in Parshotam Lal Dhingra vs Union of India (1) that, "It is, therefore, quite clear that appointment to a permanent post in a Government service, either on probation, or on an officiating basis, from the very nature of such employment, itself of a very transitory character and, in the absence of any special contract or specific rule regulating the conditions of the service, the implied term of such appointment, under the ordinary law of master and servant, is that it is terminable at any time. In short, in the case of an appointment to a permanent post in a Government service on probation or on an officiating basis, the servant so appointed does not acquire any substantive right to the post and consequently cannot complain, any more than a private servant employed on probation or on an officiating basis can do, if his service is terminated at any time. " The respondent had of course no right to the post of Deputy Superintendent of Police to which he had been given an officiating appointment and he does not contend to the contrary. He cannot therefore, without more, complain if he is sent back to his original post. This is what happened in this case even if it be taken that the respondent 98 had been reverted to his original rank because he was found unsuitable for the higher rank to which he had been given an officiating appointment. It is however true that even an officiating person may be reverted to his original rank by way of punishment. It was therefore, observed in Dhingra 's case (1) at p. 863, "Thus if the order entails or provides for the forfeiture of his pay or allowances or the loss of his seniority in his substantive rank or the stoppage or postponement of his future chances of promotion, then that circumstances may indicate that although in form the Government had purported to exercise its right to terminate the employment or to reduce the servant to a lower rank under the terms of the contract of employment or under the rules, in truth and reality the Government has terminated the employment as and by way of penalty. " It is quite clear that the circumstances mentioned in this observation have not occurred in the present case. The reversion has not in any way affected the respondent so far as his condition and prospect of service are concerned. He of course, lost the benefit of the appointment to the higher rank but that by itself cannot indicate that the reversion was by way of punishment because he had no right to continue in the higher post or to the benefits arising from it. He had been reverted in exercise of a right which the Government had uncle the terms of the officiating employment. The High Court seems to us to have been in error in thinking that the Government 's refusal to supply the respondent with the reasons why action has taken against him proved that the reversion was a reduction in rank by way of. punishment; the refusal cannot prove that. It may give rise to a suspicion about the motive which led the Government 99 to take the action, but it is now firmly established that if the action is justifiable under the terms of the employment, then the motive inducing the action is irrelevant in deciding the question whether the action had been taken by way of punishment: see Parshotam Lal Dhingra 's case (1) at p. 862. It does not require to be repeated now that unless the reversion is by way of punishment, section 240 (3) is not attracted. The High Court seems to have been in error also in drawing an inference from the holding of the departmental inquiry that the respondent must have been reduced in rank by way of punishment. The departmental inquiry was held long after the order reverting the respondent had been passed and could not have been the occasion for the reversion of the respondent. The Government had the right to consider the suitability of the respondent to hold the position to which he had been appointed to officiate. It was entitled for that purpose to make inquiries about his suitability. This is all that the Government did in this case. This inquiry cannot show, whatever the findings may have been, that the reversion earlier made was by way of punishment. Mr. Anthony for the respondent referred us to State of Bihar vs Gopi Kishor Prasad (2) in which it was observed, "But, if instead of terminating such a person 's service without any enquiry, the employer chooses to hold an enquiry into his alleged misconduct, or inefficiency, or for or some similar reason; the termination of service is by way of punishment, because it puts a stigma on his competence and thus affect his future career. " That case dealt with the discharge of a probationer officer on the ground that he was unsuitable. The observation there made was considered by this 100 Court in the later case of The State of Orissa vs Ram Narayan Das (1) where it was said, "The third proposition in the latter case refers to an enquiry into allegations of misconduct or inefficiency with a view, if they were found established, to imposing punishment and not to an enquiry whether a probationer should be confirmed. " We would repeat that in the present case the enquiry was concerned with ascertaining the suitability of the respondent for the higher rank and was not a punishment. At one stage Mr. Anthony was inclined to argue that the enquiry was really a part of the original order of reversion and that it had been deliberately postponed to as to avoid the applicability of section 240(3) of the Government of India Act, 1935 No such case is made in the plaint. Neither was it made in the courts below nor can it be based on their findings. Such a case cannot now be made. We think, therefore, that the appeal must be allowed with costs throughout and we order accordingly. Appeal allowed.

The respondent who held the substantive post of Inspector of Police and had been officiating as the Deputy Superintendent of Police was reverted to his original rank of Inspector without being given any opportunity of being heard in respect of the reversion. His request to furnish him with reasons of his reversion was refused. Later a Departmental enquiry was held behind his back in respect of certain allegations of misconduct made against him in a confidential communication from the District Superintendent of police to the Deputy Inspector General of Police but these allegations were not proved at the enquiry. The Inspector General of Police however thereafter wrote to the Government that the respondent 's previous record was not satisfactory and that he had 93 been promoted to officiate as Deputy Superintendent of Police in the expectation that he would turn a new leaf but the complaint made in the confidential memorandum was a clear proof that the respondent was habitually dishonest and did not deserve promotion. As the order of reversion was maintained by the Government inspite of the representations made by the respondent. he filed a suit challenging the order. The suit was decreed by the Court of first instance and the decree was affirmed by the High Court on appeal. ^ Held, that a person officiating in a post has no right to hold it for all times. A person who is given an officiating post to test his suitability to be made permanent later, holds it on the implied term that he would have to be reverted if he was found unsuitable. A reversion in such a case on the ground of unsuitability is an action in accordance with the terms on which the officiating post was being held and is not a reduction in rank by way of punishment to which section 240 of the Government of India Act, 1935, would be attracted. The observation in M. A. Waheed vs State of Madhya Pradesh, (1954) N. L. J. 305, that when a person officiating in a post is reverted for unsatisfactory work, that reversion amounts to reduction in rank disapproved. The Government 's refusal to supply the respondent with the reasons for reverting him could not proved that the reversion was by way of punishment. The departmental enquiry held later in this case does not prove that the respondent was reverted by way of punishment. The Government had the right to consider the suitability of the respondent to the post to which he had been appointed to officiate. State of Bihar vs Gopi Kishore Prasad, A. I. R. , referred to.

Civil Appeal No. 246 of 1959. Appeal from the judgment and decree dated December 4. 1956, of the Patna High Court in First Appeal No. 429 of 1951. A. V. Viswanatha Sastri and Mohan Behari Lal, for the appellant. B. K. P. Sinha and A.G. Ratnaparkhi, for respondent No. 1. M. K. Ramamurthy R. K. Garg, D. P. Singh and section C. Agarwal, for respondent No. 6. 1961, December 13. This appeal arises out of a suit brought by the respondent Kumar Jagat Kishore 121 Prasad Narayan Singh, hereafter called the respondent, against the appellant, the Raja of Kanika, for redemption of certain mortgages. The suit was decreed by a learned Subordinate Judge of Gaya and the High Court at Patna confirmed that decree on appeal. The appellant has now appealed to this Court against the judgment of the High Court. In the High Court many points were argued but in this Court Mr. Sastri for the appellant pressed only one point. We have therefore to state only such of the facts as concern the point raised by Mr. Sastri. The respondent claimed to be entitled to redeem the mortgages as the executor of the estate of Chandreshwar Prasad, the mortgagor, and as the receiver appointed in certain execution proceedings hereafter mentioned. It has since been finally held, as will appear later, that the will appointing the respondent executor was not genuine. It may also be stated that the respondent is no longer holding the office of receiver. It would, therefore, appear that the respondent has now no locus standi to contest the appeal. He was however, the only person opposing the appeal in this Court. As learned counsel for the appellant did not object to the respondent appearing in this appeal, it is unnecessary to discuss the respondent 's position further. It appears that on February 17, 1924, Chandreshwar Prasad executed a mortgage in favour of the then Raja of Kanika to secure a sum of Rs. 4,00,000/ . The mortgaged properties consisted of certain Mokarrari tenures. The mortgage debt not having been paid, the Raja of Kanika filed a suit on the mortgage and obtained preliminary and final decrees thereon. Thereafter he put the decree into execution sometime in 1938 and we are informed that the execution case was never finally disposed of. It was in these execution proceedings 122 that the respondent had been appointed the receiver of the mortgaged properties. The Mokarrari tenures were held under the Tikari Raj. The Tikari Raj had mortgaged its proprietary interests in these and other tenures to the Darbhanga Raj by way of a usufructuary mortgage. Chandreshwar Prasad appears to have failed to pay the rent of the mortgaged and other tenures which he held under the Tikari Raj. Thereupon, the Darbhanga Raj as the usufructuary mortgagee of the proprietary interests in these tenures started certificate proceedings for the realisation of the rent and in or about 1940 obtained a certificate for Rs. 83,267/ in respect of arrears of rent. The certificate put the mortgage security of the Raja of Kanika in jeopardy and the latter thereupon on September 28, 1940, paid the amount of the certificate. In view of this payment, under section 171 of the Bihar Tenancy Act the Raja of Kanika became the mortgagee of the tenures in respect of the rent of which the certificate had been issued and also entitled to possession of the tenure villages till the amount paid by him in respect of the certificate was repaid with interest at the rate prescribed. On November 23, 1940, the Raja of Kanika took possession of all the tenures in respect the arrears of rent of which the certificate had been issued. As a result, the receiver appointed in the execution case was dispossessed. The mortgagor Chandreshwar Prasad died on September 28, 1941. The respondent as the executor under a will alleged to have been left by Chandreshwar Prasad obtained probate of it from the High Court on December 10, 1945. He was appointed receiver in the execution case on February 17, 1949. On September 20, 1949, the respondent as the receiver and executor as aforesaid filed the suit for the redemption of the aforesaid mortgages. By 123 this date, the Raja of Kanika in whose favour the mortgage had been executed in 1924 had died and the suit was brought against the appellant as his successor and as the person then entitled to the mortgage 's interest. The respondent contended that the Raja of Kanika had realised sufficient amounts from the tenures of which he came into possession under section 171 of the Bihar Tenancy Act, to pay off both the mortgages and had in fact realised more which he was liable to repay. On March, 19, 1951, the respondent was removed from his office as receiver and thereafter on August 22, 1951, the High Court in a Letters Patent Appeal set aside the grant of the probate, holding the will to be a forgery. On the last mentioned date, a decree for redemption was passed in the suit by the Subordinate Judge, directing the accounts to be taken and giving other usual directions. The appellant appealed from the judgment of the learned Subordinate Judge to the High Court at Patna some time in September 1951. While this appeal was pending in the High Court, four daughters of Chandreshwar Prasad were brought on the record as representing the mortgagor 's interest. In the meantime, on September 25, 1950, the Bihar Land Reforms Act, 1950 had come into force. This Act provided that the State Government might by notification declare that the estates or tenures mentioned in it had passed to and become vested in the State. Sometime in 1952, a notification was issued by the Bihar Government under this Act vesting in the State of Bihar the tenures which had come into the possession of the Raja of Kanika under section 171 of the Bihar Tenancy Act. As a result of this notification the right, title and interest of the mortgagor Chandreshwar Prasad and of the superior owner in tenures vested absolutely in the state free from all encumbrances and 124 the proprietor and tenure holder ceased to have any interest in them. In August 1952, the State of Bihar took possession of these tenures from the appellant who had till then been in possession. Thereafter, the State of Bihar was made a party to the appeal pending in the High Court. As required by section 14 of the Bihar Land Reforms Act, the appellant filed claims in respect of his dues under his aforesaid mortgage decree and the mortgage under section 171 of the Bihar Tenancy Act before the officer appointed under the first mentioned Act. The daughters of Chandreshwar Prasad were made parties to the claim proceedings but they did not appear to contest the claim. On January 15, 1955, the Claims Officer decided that a sum of Rs. 5,33,077/ was due to the appellant in respect of the mortgage of 1924 a sum of Rs. 25,034/4/ in respect of the mortgage created by the operation of section 171 of the Bihar Tenancy Act. No appeals had been taken against these decisions of the Claims officer as provided in the Land Reforms Act and they therefore became final under section 18(3) of that Act. The appellant 's appeal to the High Court which had been pending all this time, thereafter came up for hearing and it was dismissed on December 4, 1956. It had been contended on behalf of the appellant that in view of section 35 of the Land Reforms Act a civil court must be deemed to have no jurisdiction to decide any question of mortgage claims over tenures vested in the Government under the Act. The High Court was unable to accept this contention as in its view what was barred by the Act was a suit by the mortgagee only and observed that the Act did not contain any provision barring a suit by the mortgagor. In that view of the matter the High Court confirmed the decree of the learned Subordinate Judge. This appeal against this decisions of the High Court. We think that this appeal must be allow. It is clear that a redemption decree can no more be 125 given effect to after the notification issued under the Land Reforms Act, since thereafter the mortgaged tenures became vested in the State of Bihar free from all encumbrances. The tenures having vested in the State of Bihar, the mortgagee had no longer any interest in the tenures nor was he in possession of them. He could not carry out the decree by reconveying the tenures to the mortgagor or put him into possession. The mortgage as a security had ceased to exist, for the mortgaged properties vested in the State of Bihar under the Act free from all encumbrances. The mortgagor in his turn also ceased to be entitled to the mortgaged properties. He had hence no right to redeem them. Therefore, in our view, the decree for redemption which had been previously passed, became infructuous. But it was said that if the mortgagee had realised more out of the income of the mortgaged properties than was due to him, the mortgagor was entitled to repayment of the excess realisation and that, therefore, the redemption decree in so far as it directed the taking of accounts had not become infructuous. We are unable to accept this contention in view of the provisions of the Land Reforms Act to some of which we shall now refer. Under section 4, upon the notification, all the interests of proprietors and tenure holders in estates and tenures mentioned in it came to an end and vested in the State free from all encumbrances. Clause (d) of this section provides that no suit will lie in a civil court for the recovery of moneys due from the proprietor or tenure holder on a mortgage of the estate or tenure and all such suits and proceedings pending on the date of vesting will be dropped. Section 14 provides that every creditor whose debt is secured by a mortgage of an estate or tenure vested in the State may within the time there prescribed notify his claim in writing to a Claims 126 Officer for the purpose of determining the amount of the debt payable to him. It would be clear from this section and section 4(d) earlier referred to, that a mortgagee could not recover the amount due to him from the mortgaged tenures which had vested in the Government except by following the procedure laid down in section 14. Section 14 also provides that the Claim 's Officer shall be a Subordinate Judge or a Munsif depending on the amount of the claim. Section 16 states the principles how the claim of the creditors is to be ascertained. It is not necessary to refer in detail to the provisions of this section but it may be stated that it gives power to scale down the interest. Section 17 provides for appeals against the decisions of the Claims Officer to a Board one of whose members shall be a Judge of the High court or a District Judge, again depending on the amount of the claim. Sub section (3) of section 18 provides that "The decision of the Board and where no appeal has been filed to the Board, the decision of the Claims Officer shall be final. " Sections 14 to 18 are contained in Chapter 4 of the Act. Chapter 5 of the Act deals with the assessment of compensation payable to the divested proprietors or tenure holders. Section 24, which is contained in this chapter, deals with the determination of the amount of compensation payable in respect of the transference of the properties to the State. Sub section (5) of this section provides that in a case where the interest of a proprietor or tenure holder is subject to a mortgage, the compensation shall first be payable to the creditor and then to the proprietor or tenure holder, the amount of compensation payable to the creditor being the amount determined under Ch. All compensation payable to the proprietor, tenure holder or encumbrancer is required to be set out in the compensation Assessment roll. Section 35 of the Act states, "No suit shall be brought in any Civil Court in respect of any entry in or omission from a Compensation Assessment roll 127 or in respect of any order passed under Chapters II to VI or concerning any matter which is or has already been the subject of any application made or proceedings taken under the said Chapters. " This section would make it impossible for the decision of the Claims Officer or the Board to be challenged in an ordinary civil proceeding. Section 32, which is contained in Chapter 6 of the Act, provides that when the Compensation Assessment roll was become final as prescribed in the Act, the Compensation Officer appointed under the Act shall proceed to make payment in the manner specified in it. We may also refer to section 38 of the Act which states that the Claims Officer and the Compensation Officer shall have the powers of a Civil Court. What is the effect of these provisions on the redemption decree in so far as it directed the mortgage accounts to be taken ? It seems to us that they rendered that part of the decree also infructuous. In our view, the mortgage accounts cannot be taken under the decree for they have already been taken under the Act and the decision of the Claims Officer on the State of the accounts is final under section 18(3). In view of section 35, no suit can be brought concerning the decision of the Claims Officer. It is true that the suit in the present case had been brought before the Act and would not itself be affected by section 35. But we should suppose that the Act will now prevent the account being taken under the decree so as to challenge the decision of the Claims Officer. If this were not so, the Officer taking the accounts under the decree has to accept the Claims Officer 's decision for that is final and the parties cannot challenge it. That being so, the result would be that the officer taking the accounts would have to make a report finding that the same amount which the Claims Officer found to be due, was due to the mortgagee. On this report a decree would follow and the appellant would become entitled to the amount found due 128 to him under the decree. Now, he was already entitled to that amount under section 32(1) of the Act. He would then have a right to be paid the same sum twice over in respect of the same mortgage right. We cannot conceive that such an anomalous position could have been intended by the Act. We, therefore think that since the Act, the redemption decree cannot be given effect to. The High Court seems to have thought that the Officer taking the accounts under the redemption decree would not be bound by the decision of the Claims Officer. This view was based on the reason that only such of the Claims Officer 's decisions would be binding as had been given in matters over which he had jurisdiction and that he had no jurisdiction to investigate into a claim by the mortgagor in respect of realisation by the mortgagee from the mortgaged properties in excess of his dues. We think that in this the High Court was in error. In taking the accounts the Claim 's Officer has to decide under section 16 (2)(b) how much had been paid to the mortgagee or realised by him. It is therefore, wrong to say that the Act did not give the Claims Officer jurisdiction to go into the question of the realisation by the mortgagee. It is true, as the High Court pointed out, that the Act does not expressly bar a suit by a mortgagor for redemption but that seems to be the practical and inevitable effect of it. This does not affect the rights of a mortgagor. He can establish before the Claims Officer that the mortgagee had realised out of the income of the mortgaged properties of which he was in possession more than what was legitimately due to him. If he succeeds in doing that the Claims Officer will hold that nothing in payable to the mortgagee out of the compensation. He may even indicate that the mortgagee has been overpaid to a certain extent. Whether in such a case the mortgagor can file a suit to recover from the mortgagee the amount paid in excess is not a question that arises in this appeal. 129 Even if he could, that would not lead to the conclusion that in the present case the mortgage accounts can be taken under the redemption decree. We therefore, express no opinion on that question. We think it right to point out that the Act has taken sufficient care to see that neither the mortgagor nor the mortgagee is in any way prejudiced in the proceedings concerning the investigation of the mortgagee 's claim. It has provided that the investigation would be by experienced judicial officers of high status and that the proceedings would be taken as if they were taken in a Civil Court. In the result, in our view, on the mortgage security having vested in the State of Bihar free from encumbrances under the Land reforms Act the redemption decree passed by the learned Subordinate Judge became infructuous. The decree could not stand any more; the accounts directed to be taken by it could no more be taken, nor the other directions contained in it carried out. In our view, the High Court was in error in confirming the decree. The decree could no longer be acted upon. The claim proceedings under the Act finally determined the state of the mortgage accounts. We, therefore, allow this appeal, set aside the decree of the High Court and direct that the respondent 's suit for redemption be dismissed. There will be no order for costs.

K the mortgagee of certain Mokarrari tenures obtained a decree on his mortgage and put it into execution. Pending execution, C the mortgagor having failed to pay the rent of the mortgaged and some other tenures they became liable to be sold for the realisation of the arrears of rent under a certificate issued for the purpose. K whose security was thereby jeopardised paid the arrears and became under section 171 of the Bihar Tenancy Act a mortgagee of the tenures for the amount paid and entitled to possession of them till repayment. K thereafter took possession of the tenures. After C had died in 1941, the respondent claiming to represent his estate as receiver and executor under his will sued the appellant who had succeeded to K 's interest, for redemption of the mortgages on the allegation that K and the appellant had realised from the rents of the tenures in their possession more than what was due. The suit was decreed by the trial court. The appellant appealed to the High Court at Patna. While the appeal was pending there the Bihar Land Reforms Act, 1950, came into force and as a result of a notification issued under it all the tenures became vested in the State of Bihar free from all encumbrances and the proprietors, tenure holders and all other persons ceased to have any interest in them but became entitled to compensation for the divestment. As required by section 14 of the Land Reforms Act, the appellant filed a claim before the officer appointed under the Act in respect of his mortgages on the tenures and such claim was adjudge at a certain sum on notice to C 's representatives which adjudication later became final under section 18. Under the provisions of the Land Reforms Act, the amount so found due became payable out of the compensation awarded to the proprietors and tenureholders. Thereafter the appeal before the High Court came up for hearing. The appellant contended that in view of the provisions of section 35 of the Land Reforms Act a civil court must 120 be deemed to have no jurisdiction to decide any question concerning claims under mortgages of tenures vested in the Government under the Act. The High Court rejected this contention observing that the Act barred a suit by a mortgagee only and not a suit by a mortgagor and confirmed the decree. ^ Held, that though the Act did not expressly bar a suit by a mortgagor for redemption, that was the practical and inevitable effect of it. The mortgage accounts could not be taken over again by the civil court when they had been taken under the Act and the decision in the proceedings under the Act had become final. Held, further, in the proceedings under the Act to ascertain the claim of a creditor, the debtor was entitled to show what had been paid to the creditor or what the creditor had realised from the mortgaged property. Held, also, that after a mortgagor had been divested of the mortgaged property under the Act a redemption decree would be infructuous as the mortgagor would not then be entitled to have it reconveyed to him. Neither would it then be in the power of the mortgagee to convey that property. In fact the mortgagor having been divested of the property and lost his right of redemption. Query Whether if the mortgagee had realised from the profits of the mortgage property more than what was due him on his mortgage, a suit by the mortgagor refund would lie ?

s Nos. 114 and 115 of 1961. Petition under article 32 of the Constitution of India for enforcement of Fundamental Rights. 832 M. K. Nambiar, M. K. Govind Bhatt, section N. Andley, and Rameshwar Nath, for the petitioners. M. C. Setalvad, Attorney General of India, K. K. Mathew, Advocate General for the State of Kerala, Sardar Bahadur, George Pudissary and V. A. Seyid Muhammad, for the respondents. December 5. The Judgment of Gajendra gadkar, Wanchoo and Das Gupta, JJ., was deliverd by Wanchoo, J. Sarkar, J. and Ayyangar, J. delivered separate Judgment. WANCHOO, J. These two writ petitions which were heard along with Purushothaman Nambudiri vs The State of Kerala (1) raise the constitutionality of the Kerala Agrarina Relations Act, No. IV of 1961 hereinafter referred to as the Act. The petitioners come from that part of the State of Kerala which was formerly in the South Canara district of the State of Madras and came to the State of kerala by the State Reorganisation Act of 1956. Their lands are situate in Hosdrug and kasargod Taluks which have now been made part of the Cannanore District in the State of Kerala. They hold large areas of lands, the major part of which is held by them as ryotwari parradars, of Madras under the Board 's Standing Orders of that State. In these lands they have areca and pepper plantations besides rubber plantation. They also grow other crops on some of the lands. The Act is being attacked on the ground that it contravenes articles 14, 19 and 31 of the Constitution. Besides this, it is also contended on behalf of the petitioners that the Bill which became the Act lapsed under the provisions of the Constitution, and therefore the assent given to the Bill by the President was of no effect and did not result in the Bill becoming an Act. We do not think it necessary to set out the details of the attack on this last score in the present petitions as the matter 833 has been considered in full in the judgment in the connected Writ Petition No. 105 of 1961. The petitioners further submit that their lands which they hold as ryotwari pattadars are not estates within the meaning of article 31A (2)(a) of the Constitution and therefore the Act so far as it affects them is not protected under article 31A, and it is open to them to assail it as violative of the rights conferred on them by articles 14, 19 and 31 of the Constitution. They have attacked the Act on a number of grounds as ultra vires the Constitution in view of the provisions of articles 14, 19 and 31. We do not however think it necessary to detail all the attacks on the constitutionality of the Act for present purposes. It is enough to say that the main attack on the constitutionality of the Act has been made on the following six grounds: (1) The Bill which became the Act had lapsed before it was assented to by the President and therefore the assent of the President to a lapsed bill was of no avail to turn it into law. (2) The Act is a piece of colourable legislation as it has made certain deductions from the compensation payable to landholders under Chap. II and to others who held excess land under Chap. III and this amounts to acquisition of money by the State which it is not competent to do under the power conferred on it in Lists II and III of the Seventh Schedule to the Constitution. (3) The properties of the petitioners who are ryotwari pattadars are not estates within the meaning of article 31A of the Constitution and therefore the Act is not protected under that Article so far as it applies to lands of ryotwari pattadars like the petitioners. (4) The Act exempts plantation of tea, coffee, rubber and cardamom from certain 834 provisions thereof, but no such exemption has been granted to plantations of areca and pepper, and this is clearly discriminatory and is violative of article 14. (5) The manner in which ceiling is fixed under the Act results in discrimination and is therefore violative of article 14. (6) The compensation which is payable under Chapters II and III of the Act has been reduced by progressive cuts as the amount of compensation increase and this amounts to discrimination between persons similarly situate and is therefore violative of article 14. The petitions have been opposed on behalf of the State and its contention is, firstly, that the Bill did not lapse and the President 's assent was rightly given to it rightly became law; secondly, that the petitioners ' estates lands are estates within the meaning of article 31A (2)(a) and the Act is therefore protected under that Article; thirdly, that the Act is not a piece of colourable legislation and the State Legislature was competent to enact the Act under item 18 of List II and item 42 of List III of the Seventh Schedule and there is no acquisition of money by the state under the Act and reference is made to section 80 of the Act in this connection; and lastly, that the discrimination alleged with respect to plantations, the fixation of ceiling and the deductions from compensation payable under Chapters II and III is really no discrimination at all and the provisions in that behalf are based on an intelligible differentia which is in accordance with the object and purpose of the Act. The question whether the Bill which finally received the assent of the President on January 21, 1961, had lapsed because the legislative assembly which originally passed it was dissolved and a new legislative assembly which came into being after 835 the general elections reconsidered and re passed it under article 201 of the Constitution has been considered by us in Writ Petition No. 105 of 1961, judgment in which has just been delivered and it has been held there that the bill did not lapse and therefore it validly became law when the President assented to it. The attack on the Act therefore on this grounds must fail. We now come to the attack made on the Act on the ground that it is a piece of colourable legislation beyond the legislative competence of the State legislature. What is colourable legislation is now well settled: see K. C. Gajapati Narayan Deo vs The State of Orissa (1), where it was held "that the question whether a law was a colourable legislation and as such void did not depend on the motive or bona fides of the legislature in passing the law but upon the competency of the legislature to pass that particular law, and what the courts have to determine in such cases is whether though the legislature has purported to act within the limits of its powers, it has in substance and reality transgressed those powers, the transgession being veiled by what appears, on proper examination, to be a mere pretence or disguise. The whole doctrine of colourable legislating is based upon the maxim that you cannot do indirectly what you cannot do directly. The Act has been passed under the legislative powers vested in the State legislature under item 18 of List II and item 42 of List III of the Seventh Schedule. Item 18 of List II deals inter alia with "land, that is to say, rights in or over land, land tenures including the relation of landlord and tenant, and the collection of rents" Item 42 of list III deals with "acquisition and requisitioning of property. " The contention on behalf of the petitioners is that in the guise of legislating under these two entries the State legislature by the employment of certain 836 devices has taken away money, which should have gone to land owners or to those from whom excess lands were being acquired. The attack is based on the facts that in section 52 of the Act compensation payable to a land owner is reduced after the purchase price to be paid by the tenant to whom the land is to be assigned has been ascertained, and that in section 64 of the Act the compensation payable to a person from whome excess land is taken in reduced by certain percentage after the market value of the land has been determined. It is urged that by these devices the State is acquiring money which should properly have gone to the land owner to whome compensation is payable under section 52 and to the person who surrenders excess land to whome compensation is payable under section 64. There is no doubt that certain deductions are made from the purchase price payable by the tenant under section 45 and from the market value before compensation is arrived at for payment to the land owner under section 52 and to the person surrendering excess land under section 64. But if one looks at the purpose and object of the Act it will be clear that the main provisions of the Act are clearly within the legislative competence of the State legislature under item 18 of List II and item 42 of List III. The scheme of the Act so far as Chap. II dealing with extinction of the land owner 's right is concerned is that the land owner 's right vested in the State under sections 41 and 42 on a day to be notified by the Government in that behalf. Thereafter, section 43 provides that cultivating tenants of the lands which have vested in the State shall have a right to assignment of the right, title and interest so vested in the State on payment of a certain price which is calculated under section 45 and is called the purchase price. After the purchase price is determined, the compensation to be paid to the land owner is provided by section 52 and there is reduction in the purchase price for the purpose of given compensation. It is however obvious that the object of Chap. II is to vest proprietorship in the land in the 837 cultivating tenants and for that purpose Chap. II provides for carrying out the object in two stages. In the first stage, the property of the landowner is vested in the State. Thereafter the tenant is given the right to acquire that property from the State. What price the tenant is to pay for the land is worked out under section 45, and what compensation the State is to pay to the land owner is worked out under section 52, which however reduces the purchase price arrived at under section 45 for the purpose of giving compensation. It is however clear that tenants are not bound to apply to acquire the land which they hold as tenants and where they do not do so, section 44 (3) provides that they become the tenants of Government and shall be liable to pay to the Government the rent payable in respect of the land from the date on which the right, title and interest over the land vested in the Government. It cannot therefore be said that the scheme which provides for two stages, namely, first acquisition by Government and secondly assignment to tenants is a camoflage devised for the purpose of taking away the money which would otherwise have been payable to the land owner in case the interest of the landowner was directly transferred to the cultivating tenants. It is also clear that there is bound to be a time lag between the acquisition under sections 41 and 42 and the assignment to tenants under section 43 and the subsequent sections and in the meantime the Government would be the owner of the rights acquired. Clearly, therefore Chap. II of the Act envisages first the acquirement of the land owner 's interest by the State for which compensation is payable under s.52. Thereafter the State will assign to such cultivating tenants as may apply the rights acquired by the State and there is likely to be an interval between the two transactions. Besides some cultivating tenants may not apply at all and that part of the property will remain with the State Government. In these circumstances it cannot be said that the scheme evolved in Chap. II is a device for 838 taking away any part of the money to the landowner from the tenant to whom his interest may eventually be assigned. Besides the adequacy of compensation provided under section 52 for acquisition by the State of the interest of the land owner cannot be challenge on the ground that the compensation provided by the law is not adequate: See article 31(2). It is only because the compensation provided under section 52 is a percentage of the purchase price as calculated under section 45 that it appears as if the State is taking away a part of the compensation due to the landowner. Section 52 is however only a method for determining compensation and the whole compensation due to the land owner is to be found in section 52 and it cannot therefore be said that any part of the compensation is being taken away by the State. Similarly the scheme of Chap. III which provides a ceiling is that any land in excess of the ceiling shall vest in the Government under section 62. Thereafter the land so vested in Government can be assigned under section 70 to persons who do not possess any land or possess land less than 5 acres of double crop nilam or its equivalent. It is true that Government may assign the lands to those who apply under section 70 but it is not bound to do so and here again there will be a time lag between the vesting of the excess land in the Government under s.62 and its assignment to those who are eligible under section 70. The charge that in this Chapter there is a device for taking away the compensation due to the land owner is based on the fact that section 72 the person to whom the land is assigned under section 70 has to pay 55 per cent. Of the market value of the land while the person from whom the excess land is taken is not always paid 55 per cent. Of the market value, inasmuch as the percentage goes down to 25 per cent. Of the market value in certain circumstances. But here again the compensation is provided entirely under section 64 and it is that section which sets out the manner in which the compensation is to be 839 provided. The adequacy of that compensation cannot be questioned in view of article 31(2). The fact that under sections 70 and 72 when the Government in its turn assigns land to those who are eligible for such assignment, a different percentage of market value is fixed would not make these provisions a device to take away the money due to those who surrender excess land. As we have already said the compensation to those who surrender excess land is all provided by section 64 and even if there is a difference between the price payable under section 72 by the assignee and the compensation payable to the landowner under section 64 that would not amount to taking away the money of the landowner by a device particularly when the assignment is bound to take place sometime after the property has been acquired by Government. It is also clear from the provisions contained in Chapters II and III of the Act that the main purpose of the Act is to do away with intermediaries and to fix a ceiling and give the excess land, if any, to the landless or those who hold land much below the ceiling. The method employed to carry out this object is first to acquire the land for the State and thereafter to assign it to the cultivating tenants or to the landless or to those with small amounts of land. The main provisions of the Act therefore are clearly within the legislative competence of the State legislature under item 18 of List II and item 42 of List III and this is not being disputed on behalf of the petitioners. But what they contend is that in the process of doing this, the Government has by adopting certain devices taken away the money which was due to the land owner or to the person from whom the excess land is acquired. This argument is however fallacious because the compensation due to the land owner or the person from whom excess land is acquired is not what is provided by section 45 and s 72 but what is provided in section 52 and s 64. The adequacy of that compensation cannot be 840 challenged in view of article 31(2), and there is therefore no justification for saying that the money due to the landowner or the person from whom the excess land is acquired is being taken away by the State. That argument would only be possible if the compensation was the whole amount arrived at under section 45 or under section 72 and from that the Government deducted money due to the landowner. That however is not so and the compensation to which the landowner or the person from whom the excess land is acquired is to be found only in sections 52 and 64 and there is thus no question of taking away any money due to the landowner. Further, whatever unfairness might appear because of the difference between sections 45 and 52 on the one hand and sections 64 and 72 on the other and the manner in which the compensation is shown as a percentage of the purchase price or the market value is removed by the provision in section 80 of the Act. That section provides for the constitution of an agriculturist rehabilitation fund in which the surplus, if any, of the purchase price after the disbursement therefrom of the compensation is to be put along with other moneys. This surplus does not to go to the revenues of the State and the State cannot be said to have taken away for its own purpose any part of the compensation. Further section 80 provides that the fund shall be utilised for rendering help by way of loan, grant or otherwise to persons affected by the Act who are eligible for the same in accordance with the rules framed by the Government. The fund therefore created under section 80 of the surplus, if any, is to be utilised for rendering help to persons affected by the Act. That in our opinion clearly means either the landowners whose rights are affected by Chap. II or the persons from whom excess land is taken under Chap. The surplus money therefore is to be utilised for the benefit of the persons affected by the Act as indicated above. This section also 841 provides that the Government will frame rules with respect to the persons affected and their eligibility for help from the fund. Our attention in this connection has been drawn to the eligibility rules framed under this section for the administration of the fund, and in particular to r. 161 which provides for eligibility for grants and loan. That rule in our opinion goes beyond the scope of section 80 in so far as it provides for making of grants or loans to persons not affected by the Act. We may in this connection refer to r. 161 (a)(i) and (ii) and r. 161 (b) (i) and (ii) which are so framed as to take within their scope even persons not affected by the Act, though r. 161 (a)(iii) and r. 161(b)(iii) are with respect to persons who may be affected by the Act. Rule 161(a)(i) and (ii) and r. 161(b)(i) and (ii) in so far as they take in persons not affected by the Act are ultra vires of the provisions of section 80 and must be struck down on that ground and may have to be replaced by more suitable rules. But the rules which have been actually framed will not affect the provisions of section 80 which clearly show that the fund is for the benefit of those who are affected by the Act, namely, those who are affected by Chapters II and III of the Act, i.e., those landowners whose rights have been acquired under sections 41 and 42 and those persons from whom excess land is taken away under section 62. Section 80 thus clearly shows that any surplus that may arise is not taken away by the State for its own revenue purposes but is meant to be used for the benefit of those affected by the Act and therefore even the apparent result of the difference between sections 45 and 62 and ss 64 and 72 is taken away by the constitution of the fund under section 80, and it cannot be said at all under the circumstances that any device has been employed in the Act to take away the moneys of the landowners or the persons from whom excess land is taken away for the purpose of adding to the revenue of the State. We are therefore of opinion that 842 the Act" cannot be struck down as a colourable piece of legislation which is beyond the competence of the State Legislature. Article 31A was inserted in the Constitution by the Constitution (First Amendment) Act, 1951, with retrospective effect so that it must be deemed to have been in the Constitution from the very beginning, i.e., January 26, 1950. The article was further amended by the Constitution (Fourth Amendment) Act, 1955 which was also made retrospective and therefore article 31A as it stands today must be deemed to have been part of the Constitution right from the start, i.e., January 26, 1950. We are not concerned in the present petitions with cl. (1) of article 31A, which was extensively amended in 1955 but only with cl. This clause originally read as follows: "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. (b) the expression 'right ' in relation to an estate, shall include any rights vesting in a proprietor, sub proprietor, under proprietor, tenure holder or other intermediary and any rights or privileges in respect of land revenue. " In 1955, in sub cl. (a) the words "and in the States of Madras and Travancore Cochin any janmam rights " were added at the end while in sub cl. (b) the words " raiyat under raiyat " were added after the word " tenure holder " and before the words "or other intermediary". 843 It will be seen therefore that so far as the meaning of the word "estate" is concerned, there was no change in sub cl. (a) and the only change was with respect to the inclusive part of the definition of the word "estate". The word "estate has all along been defined to have the same meaning in relation to any local area as that expression or its local equivalent has in the existing law relating to landtenures in force in that area. It is also remarkable that the word "intermediary" does not occur in sub cl. (a) though it occurs in sub cl. The definition in sub cl. (a) is self contained and there is no scope for importing any idea of intermediary in the definition from sub cl. The reason why the words "other intermediary" are used in sub cl. (b) which defines rights in relation to an estate, is that sub clause mentions a number of intermediaries as such, like sub proprietors, under proprietors, tenure holders but does not give a complete enumeration of all intermediaries that may be existing in an estates all over India and therefore uses the words "other intermediary" to bring in all kinds of intermediaries existing in an estate. As an example we may mention that formerly in Uttar Pradesh there were fixed rate tenants in the permanently settled districts who were also intermediaries and it is such persons or their likes who were brought in within the sweep of the definition of rights in relation to an estate by the use of the words "other intermediary". Therefore, when the words "raiyat, under raiyat " were added in sub cl. (b) in 1955, it was further enumeration within a class already there; further as held in The State of Bihar vs Rameshwar Pratap Narain Singh (1), their inclusion in the circumstances and in the particular setting showed that the words "or other intermediary" did not necessarily qualify or colour the meaning to be attached to these new tenures. The meaning of the word "estate" has however to be found in 844 sub cl. (a) and it is the words used in that sub clause only which will determine its meaning irrespective of whether any intermediary existed in an estate or not. The meaning of the word "estate" in sub cl (a) is the same as it might be in the existing law relating to land tenure in force in a particular area. Where therefore there is an existing law in a particular area in which the word "estate" as such is defined the word would have that meaning for that area and there is no necessity then for looking for its local equivalent. But if in existing law of a particular area the word "estate" as such is not defined, but there is a definition of some other term which in that area is the local equivalent of the word "estate" then the word "estate" would have the meaning assigned to that term in the existing law in that area. In order, however, that one may be able to say that a particular term in an existing law in a particular area is a local equivalent of the word "estate" used in sub cl (a) it is necessary to have some basic idea of the meaning of the word "estate" for that purpose. That basic idea seems to be that the person holding the estate should be the proprietor of the soil and should be in direct relationship with the State paying land revenue to it, when it is not remitted in whole or in part. If a term therefore is defined in any existing law in a local area which corresponds to this basic idea of an estate that term would be a local equivalent of the word "estate" in that area. It is unnecessary to pursue the matter further because this aspect of the case has also been considered in Writ Petition No. 105 of 1961. It may be added that as the definition of the word "estate" came into the Constitution from January 26, 1950, and is based on existing law we have to look into law existing on January 26, 1950, for the purpose of finding out the meaning of the word "estate" in article 31A. 845 Let us therefore look at state of the law as it was in the State of Madras on January 26, 1950, for the area from which these petitions come was then in the district of South Canara, which was then a part of the Province of Madras, which became the State of Madras on January 26, 1950. The usual feature of land tenure in Madras was the ryotwari form but in some districts, a landlord class had grown up both in the northern and southern parts of the Presidency of Madras as it was before the Constitution. The permanent settlement was introduced in a part of the Madras Presidency in 1802. There were also various tenures arising out of revenue free grants all over the Province (see Chap. IV, Vol. III of land Systems of British India by Baden Powell) and sometimes in some districts both kinds of tenures, namely, landlord tenures and the ryotwari tenures were prevalent. There were various Acts in force in the Presidency of Madras with respect to landlord tenures while ryotwari tenures were governed by the Standing orders of the Board of Revenue. Eventually, in 1908, the Madras legislature passed the Madras Estate Land Act, No. 1 of 1908, which was later amended from time to time. It contains a definition of the word "estate" as such in section 3(2) and when the Constitution came into force the relevant part of the definition was as follows: "Estates ' means: (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) any unsettled palaiyam or jagir; (d) any inam village of which the grant has been made, confirmed or recognised by the British Government, notwithstanding that 846 subsequent to the grant, the village has been partitioned among the grantees or the successors in title of the grantee or grantees. " This Act applied to the entire Presidency of Madras except the Presidency town of Madras, the district of Malabar and the portion of the Nilgiri district known as South East Wynaad. It thus applied to the district of South Canara from where these petitions come. So far therefore as the District of South Canara was concerned, there was an existing law which defined the word "estate" for that local area. Shortly before the Constitution came into force the Madras legislature had passed the Madras Estates (Abolition and Conversion into Ryotwari) Act No. XXVI of 1948. That Act provided for the abolition of estates subject to certain restrictions with which we are not concerned. It also provided for repeal of the Madras Permanent Settlement Regulation, 1802, and the Estates Land Act of 1908 to the extent and from the date on which notifications were made under section 3 of that Act. There was thus no repeal of Act I of 1908 by the Act of 1948, and it is not in dispute that Act No. 1 of 1908 was in force on January 26, 1950, in large parts of the Province of Madras including South Canara, and is still in force in such parts of it as have not been notified under section 3 of the Act of 1948. Therefore, we reach the position that when article 31 became applicable from January 26, 1950, Act No. 1 of 1908 was still in force in large parts of the Madras State and it contained a definition of the word "estate" as such. Further, Act I of 1908 was clearly a law of land tenures as a brief review of its provisions will show. Section 6 of the Act conferred occupancy rights on tenants of certain lands in "estates" as defined in the Act of 1908. Chapter II dealt with the general rights of landlords and tenants. Chapter III dealt with provisions relating to rate of rent payable by tenants and provided for enhancement, reduction, commutation, alteration 847 and remission of rent. Chapter IV dealt with pattas and muchilikas. Chapter V provided for payment of rent and for realisation of arrears of rent. Chapter VI provided the procedure for recovery of rent. Other Chapters dealt with other matters including Chap. X which dealt with relinquishment and ejectment. It is clear therefore that the Act of 1908 was a law relating to landtenures. Therefore, we reach the position that in a law relating to land tenures which was in force in the State of Madras when the Constitution came into force the word "estate" was specifically defined. This law was in force in the whole of the State of Madras except some parts and was thus in force in the area from which the present petitions come. This area was then in the south Canara district of the State of Madras. We are therefore of opinion that the word "estate" in the circumstances can only have the meaning given to it in the Act of 1908 as amended up to 1950 in the State of Madras as it was on the date the Constitution came into force. We have already said that the Act of 1908 dealt with landlord tenures of Madras and was an existing law relating to land tenures. The other class of land tenures consisted of ryotwari pattadars which were governed by the Board 's Standing Orders, there being no Act of the legislature with respect to them. The holders of ryotwari pattas used to hold lands on lease from Government. The basic idea of ryotwari settlement is that every bit of land is assessed to a certain revenue and assigned a survey number for a period of years, which is usually thirty and each occupant of such land holds it subject to his paying the land revenue fixed on that land. But it is open to the occupant to relinquish his land or to take new land which has been relinquished by some other occupant or become otherwise available on payment of assessment, (see Land Systems of British India by Baden Powell, Vol. III, Chap. IV, section II, p. 128). Though, theoretically, according to some authorities, the occupant of ryotwari 848 land held it under an annual lease (see Macleane, Vol. I Revenue Settlement, p. 104), it appears that in fact the Collector had no power to terminate the tenant 's holding for any cause whatever except failure to pay the revenue or the ryot 's own relinquishment or abandonment. The ryot is generally called a tenant of Government but he is not a tenant, from year to year and cannot be ousted as long as he pays the land revenue assessed. He has also the right to sell or mortgage or gift the land or lease it and the transferee becomes liable in his place for the revenue. Further, the lessee of a ryotwari pattadar has no rights except those conferred under the lease and is generally a sub tenant at will liable to ejectment at the end of each year. In the Manual of Administration, as quoted by BadenPowell, in Vol. III of Land Systems of British India at p. 129, the ryotwari tenure is summarised as that of a tenant of the State enjoying a tenant right which can be inherited, sold, or burdened for debt in precisely the same manner as a proprietary right subject always to payment of the revenue due to the State". Though therefore the ryotwari pattadar is virtually like a proprietor and has many of the advantages of such a proprietor, he could still relinquish or abandon his land in favour of the government. It is because of this position that the ryotwari pattadar was never considered a proprietor of the land under his patta, though he had many of the advantages of a proprietor. Considering, however, that the Act of 1908 was in force all over the State of Madras but did not apply to lands held on ryotwari settlement and contained a definition of the word "estate" which was also applicable throughout the State of Madras except the areas indicated above, it is clear that in the existing law relating to land tenures the word "estate" did not include the lands of ryotwari pattadars, however valuable might be their rights in lands as they eventually came to be recognised. 849 Turning now to the district of South Canara and the areas from which the present petitions come it appears that originally the ryotwari settlement was not in force in this area and two kinds of tenures were recognised, namely, mulawargdar and Sarkarigniwargdar. It is, however, unnecessary to go into the past history of the matter, for it is not in dispute that the ryotwari system was introduced in South Canara district in the early years of this century. The history will be found in the Book "Land Tenures in the Madras Presidency" by section Sunderaraja Iyengar, IIEdn., pp. 45 47, where it is said that "after the introduction of the ryotwari system into South Canara, no distinction now exists between the wargadar, the mnulawargadar and kudutaledar and they are all ryotwari pattadars" Therefore, when the Constitution came into force the ryotwari pattadars of South Canara were on the same position as the ryotwari pattadars of the rest of the State of Madras. Further, as the Act of 1908 was in force in South Canara also, though there may not be many estates as defined in that Act in this area it follows that in this area also the word "estate" would have the same meaning as in the Act of 1908 and therefore ryotwari pattadars and their lands would not be covered by the word "estate". Further, there can be no question of seeking for a local equivalent so far as this parts of the State of Kerala which has come to it from the former State of Madras is concerned. We are therefore of opinion that lands held by ryotwari pattadars in this part which has come to the State of Kerala by virtue of the States Reorganisation Act from the State of Madras are not estates within the meaning of article 31A (2)(a) of the Constitution and therefore the Act is not protected under article 31A (I) from attack under articles 14, 19 and 31 of the Constitution. 850 Re. The next contention on behalf of the petitioners is that the Act makes a discrimination between areca and pepper plantations on the one hand and certain other plantations on the other and should therefore be struck down as violative of article 14 of the Constitution. Section 2(39) of the Act defines "plantation" to mean any land used by a person principally for the cultivation of tea, coffee, rubber or cardamom or such other kind of special crops as may be specified by the Government by notification in the gazette. Areca and pepper plantations have however not been included in this definition. It is urged on behalf of the petitioners that in this part of the State there are a large number of areca and pepper plantations which are practically run on the same lines as tea, coffee and rubber plantations and there is no reason why discrimination should be made between areca and pepper plantations on the other hand and tea, coffee and rubber plantations on the other. The discrimination is said to arise from the provisions of section 3 and section 57 of the Act. Section 3(viii) which occurs in Chap. II dealing with the acquisition of the interest of landowners by tenants excepts tenancies in respect of plantations exceeding thirty acres in extent from the application of that chapter. The result of this is that tenants in plantations exceeding thirty acres in extent cannot acquire the interest of the landowners with respect to such plantations and the landowners continue to own such plantations as before. Further section 57 which is in Chap. III provides for exemption of all plantations whatever their extent from the provisions of that Chapter. Thus the ceiling area provided in section 58 will not apply to plantations which will be left out in calculating the ceiling area for the purpose of s.58. Further, s.59(2) provides that in calculating the ceiling area any cashew estate if it was a cashew estate on April, 11, 1957 and continued as such at the 851 commencement of section 59 (provided the cashew estate was principally planted with cashewnuts tree and be a contiguous area not below 10 acres) will continue to be owned or held as before, though the ceiling in such cases would be reduced to half of that provided in s.58. These provisions inter alia confer benefits on those who hold plantations as defined in section 2(39) and also on those who have cashew estates as defined in the Explanation to section 59(2). The contention on behalf of the petitioners is that there is no reason why the same benefits which have been conferred on plantations as defined in the Act should not be conferred on those who hold areca and pepper plantations, and that there are no intelligible differentia which would justify the State legislature in treating the pepper and areca plantations differently from rubber, tea and coffee plantations. Article 14 has been the subject of consideration by this Court on a number of occasions and the principles which govern its application have been summarised in Shri Ram Krishna Dalmia vs Shri Justice section R. Tendolkar (1), in these words: "(a) that a law may be constitutional even though it relates to a single individual if, on account of some special circumstances or reasons applicable to him and not applicable to others, that single individual may be treated as a class by himself; (b) that there is always a presumption in favour of the constitutionality of an enactment and the burden is upon him who attacks it to show that there has been a clear transgression of the constitutional principles; (c) that it must be presumed that the legislature understands and correctly appreciates the need of its own people, that its laws are directed to problems 852 made manifest by experience and that its discriminations are based on adequate grounds; (d) that the legislature is free to recognise degrees of harm and may confine its restrictions to those cases where the need is deemed to be the clearest; (e) that in order to sustain the presumption of constitutionality the court may take into consideration matters of common knowledge, matters of common report, the history of the times and may assume every state of facts which can be conceived existing at the time of legislation; and (f) that while good faith and knowledge of the existing conditions on the part of a legislature are to be presumed, if there is nothing on the face of the law or the surrounding circumstances brought to the notice of the court on which the classification may reasonably be regarded as based, the presumption of constitutionality cannot be carried to the extent of always holding that there must be some undisclosed and unknown reasons for subjecting certain individuals or corporations to hostile or discriminating legislation. " The petitioners rely on cl.(f) of this summary and contention is that there is nothing to show either in the Act or even in the affidavit filed on behalf of the State in reply to the petitions or in the circumstances brought to the notice of the court that the classification in this case which excludes areca and pepper plantations and includes tea, coffee and rubber plantations is a proper classification based on intelligible differentia which are related to the objects and purposes of the Act. 853 This brings us to a consideration of the reasons which may have impelled the legislature to treat plantations as a class differently from other lands. The objective of land reform including the imposition of ceilings on land holdings is to remove all impediments which arise from the agrarian structure inherited from the past in order to increase agricultural production, and to create conditions for evolving as speedily as possible an agrarian economy with a high level of efficiency and productivity (see p. 178 of the Second Five Year Plan). It is with this object in view that ceiling on land holdings has been imposed in various States. Even so, it is recognised that some exemptions will have to be granted from the ceiling in order that production may not suffer. This was considered in the Second Five Year Plan at p. 196 and three main factors were taken into account in deciding upon exemptions from the ceiling, namely: (1) integrated nature of operations, especially where industrial and agricultural work are undertaken as a composite enterprise, (2) specialised character of operations, and (3) from the aspect of agricultural production the need to ensure that efficiently managed farms which fulfil certain conditions are not broken up. Bearing these criteria in mind it was recommended in the Second Five Year Plan (see p. 196) that the following categories of farms may be exempted from the operation of ceiling namely: "(1)tea, coffee and rubber plantation; (2) orchards where they constitute reasonably compact areas; 854 (3) specialised farms engaged in cattle breeding, dairying, wool raising etc; (4) sugarcane farms operated by sugar factories; and (5) efficiently managed farms which consist of compact blocks, on which heavy investment or permanent structural improvements have been made and whose break up is likely to lead to a fall in production. " The same view has been reiterated in Chap. XIV of the Third Five Year Plan dealing with Land Reform and ceiling on agricultural holdings and para 28 thereof refers to the grounds of exemption envisaged by the Second Five Year Plan. It is obvious therefore that when the State legislature in this case exempted tea, coffee, rubber and cardamom plantations from the ceiling under Chap. III and treated plantations of over 30 acres as a special case for the purpose of Chap. II, it must have had the principles enunciated above in mind to differentiate them from ordinary cultivation of other crops. If that be so, the question immediately arises whether there is any reason for treating areca and pepper plantations differently. If there is none and areca and pepper plantations stand so far as these conditions are concerned on the same footing as tea, coffee and rubber plantations there will clearly be a discrimination against them by the provisions of the Act referred to above. Turning now to pepper plantations, first, we may refer to the information contained in Farm Bulletin No. 55 relating to pepper cultivation in India issued by the Farm Information Unit, Directorate of Extension, Ministry of Food and Agriculture, New Delhi in September 1959. It appears from this bulletin that Kerala is the most important pepper producing State in India, where pepper is cultivated on an organised plantation scale over 855 fairly extensive areas. There are three distinct regions of the pepper growing belt, namely, (1) The Travancore and Cochin region. (2) The Malabar and South Canara region, and (3) the Coorg and North Canara region. Though pepper is essentially a homestead garden crop, growers were encouraged to grow it on plantation scale since 1928 when the price of pepper rose to about Rs. 700/ per candy. Since then there has been a further rise in the price of pepper with the result that new homestead gardens and plantations have sprung up and pepper cultivation has extended a good deal. During the last fifty years, pepper which was largely a household garden crop has emerged as a plantation crop and fairly large sized plantations of pepper exist in the submontane eastern parts of North Malabar and the Hosdrug taluk of South Canara, (the area from which these petitions come). In Hosdrug taluk in particular pepper is grown mostly on large scale plantations and it is here that the finest and the best organised pepper plantations in India exist. Some of the largest plantations among them have an area of a 100 to 150 acres. Pepper vines commence yielding usually from the third year, the yield increasing gradually until the vines come to full bearing in about ten years. The economic life of a vine varies from place to place. From the tenth to the 25th year, the vines are in full bearing, and the yield begins to decline after the 30th year. The initial outlay on pepper plantations is heavy and the pepper crop requires continuous attention and care. The total area under pepper is over 2 lakhs acres out of which about 20,000 acres are under pure pepper plantations. The initial expenditure on laying out a pepper plantation can be recovered only after several years and the best organised and most extensive pepper plantations of India are in the Hosdrug taluk, South Canara (from where these petitions come) and North Malabar. 856 This information taken from Farm Bulletin 55 shows that in the last fifty years pepper in India has reached the plantation stage and in particular in Hosdrug taluk from where these petitions come there are the best organized and most extensive pepper plantations in India. The initial cost of laying out a pepper plantation is heavy and the pepper vines yield nothing for three years and full production comes only in the tenth year. Therefore, where pepper is cultivated as a plantation crop on a large scale the cost is heavy and may be comparable to the outlay on large scale tea, coffee and rubber plantations. It is in these circumstances that we have to consider whether there has been discrimination against pepper plantations when they have not been included in the definition of plantation under section 2(39) of the Act. Turning to arecanut, reference may be made to Farm Bulletin No. 14 issued by the same authority. The major arecanut growing belt in India is again the same regions, i.e., South Canara, Malabar, Coorg and Travancore Cochin along with parts of Mysore, Bengal and Assam. Arecanut is also grown on plantation scale. Since the crop begins to bear fruit after about eight years, large sums have to be expended up to the bearing stage without any income till then. The estimated life of an arecanut garden is about 50 to 60 years, though some of the palms in the garden will be dying occasionally or becoming uneconomic and it will be necessary to replace them. For this reason underplanting is taken up periodically. It appears further from the Proceedings of the Ninth Annual General Special and Twelfth Ordinary Meetings of the Indian Central Arecanut Committee held on January 23, 1958, that the question whether arecanut gardens should be put under ceiling or not and whether there would be hampering of production which would be against national interest if a ceiling were imposed on such gardens had been referred to a Sub committee for consideration. 857 The Sub committee reported that if areca gardens were brought under the ceiling it would hamper production which would be against the national interest and recommended to the Planning Commission, the Central Government and the State Governments that, as proposed by the Planning Commission in respect of tea, coffee and rubber plantations, orchards, specialised farms and efficiently managed farms, arecanut gardens be also similarly exempted from ceiling. The Sub committee also noticed that arecanut cultivation involved heavy capital outlay in establishing, maintaining and protecting the arecanut trees. This recommendation of the Sub committee came up for consideration before the Indian Central Arecanut Committee on January 23, 1958, and was accepted. Thus these proceedings show that fixation of ceiling on arecanut gardens would hamper production which would be detrimental to national economy. It is in this background therefore that we have to consider whether the non inclusion of areca and pepper plantations in the definition in section 2(39) with the result that areca and pepper plantations do not enjoy similar benefits as others, is discriminatory. From what we have said above it has not been shown that there is any appreciable difference between the economics of tea, coffee and rubber plantations and areca and pepper plantations. It is true that plantations in areca and pepper are not so widespread as tea, coffee and rubber plantations but it is equally true that in this particular area from which these petitions come areca and pepper plantations are very common. The fact however that areca and pepper plantations are very common only in this area of the State of Kerala is no reason for treating them differently from tea, coffee and rubber plantations which are apparently more evenly distributed throughout the State. If the criteria evolved by the Planning Commission, as already indicated, apply to tea, coffee and rubber 858 plantations in our opinion they equally apply to areca and pepper plantations and there is no reason for differentiating between these two sets of plantations. So far as areca is concerned we have the recommendation of the Sub committee, mentioned above, endorsed by the Indian Central Arecanut Committee, that it would be detrimental to national economy not to extend the benefit of exemption from ceiling to arecanut plantations in the same way as is done in the case of tea, coffee and rubber plantations. As for pepper we have it from Farm Bulletin No. 55 that the best organised and most extensive pepper plantations of India are in Hosdrug Taluk of South Canara and that some of them are even as large as 100 to 150 acres each. The result of the application of the ceiling and other provisions of the Act would mean the break up of these plantations and may result in fall in production. It is to avoid the break up of tea, coffee and rubber plantations and the consequent fall in production that ceiling has not been imposed on these plantations. The same reasons in our opinion lead to the conclusion that pepper plantations should also be treated similarly. In this connection reference may be made to the opinion expressed in Farm Bulletin No. 55 where the author has said that it is impossible to keep a large plantation of pepper in good tip top condition, without incurring heavy expenditure and without great efforts and has added that in the existing conditions no one planter should have more than 10 acres of pepper plantation. This would seem to suggest that 10 acres is the economic optimum limit for pepper plantations. It is not clear however on what basis this recommendation is based, for undoubtedly the bulletin shows that there are plantations of much larger extent in this area and the plantations here are the best organised and the most extensive throughout the whole of India. The only reason which seems to have been given in support of the opinion that 859 10 acres is the optimum area for a pepper plantation is that one planter in that region was of the view that unless the price of one candy of pepper remained at a high level of anything between Rs. 1,500/ and Rs. 2,000/ it will be impracticable and unprofitable to maintain large scale plantations of pepper in these regions, and if prices go down for below this level, large scale pepper plantations may have even to be abandoned. This does not afford a sufficient basis for holding that 10 acres is the optimum holding for a pepper plantation. In the first place, it is mentioned at p. 8 of the bulletin that pepper began to be grown on plantation scale when the price rose to about Rs. 700/ per candy in 1928. Therefore even if the price falls below Rs. 1,500/ to Rs. 2,000/ per candy there is no reason why pepper cultivation on a plantation scale should become impracticable, particularly as it is unlikely that the cost of only pepper will fall and not all other commodities. At p. 72 the bulletin mentions that the cost of cultivation of pepper can be brought down only if the general price level is brought down substantially. Now there is no reason to suppose that there would be a catastrophic fall in the price level of pepper only which would make all pepper plantations above 10 acres uneconomic and unprofitable. In any case this is not the reason urged on behalf of the State in support of not including pepper plantations in the definition of plantation. In this connection we ought to add that the counter affidavit filed by the respondent is very unsatisfactory; no serious attempt has been made at all to justify the exclusion of pepper and arecanut from the exemption granted to tea, coffee, rubber and cardamom; no facts are stated and no data supplied in reply to the detailed allegations made in the petitions challenging the validity of the classification in question. The only reason given by the State in the counter affidavit is that a plantation crop is generally understood 860 to refer only to tea, coffee and rubber and cardamom. It is not quite clear what exactly is meant by this one sentence in the counter affidavit in support of the definition. If a plantation crop is generally understood to refer to only tea, coffee, rubber and cardamom, it is not understood why the definition provides for extending the word "plantation to other crops by notification. The very fact that power has been reserved for extending the definition by notification to other crops shows that other crops can also be grown on plantation scale. In view therefore of what we have said above with respect to the economics of areca and pepper cultivation, it is obvious that no sufficient reason has been shown for differentiating areca and pepper plantations in this area from tea, coffee and rubber plantations in the State. Making all the presumptions in favour of the classification made under s.2(39) it is clear that there is nothing on the face of the law or the surrounding circumstances which has been brought to our notice in this case on which the classification contained in section 2(39) can be said to be reasonably based. Considering the object and purpose of the Act and the basis on which exemption has been granted under Chapters II and III to plantations as defined in the Act, there appears to be no reason for making any distinction between tea, coffee and rubber on the one hand and areca and pepper on the other in this particular case. It is not as if tea, coffee and rubber are grown only on a large scale while areca and pepper are mostly grown on a small scale. We find from the report of the Plantation Inquiry Commission, 1956, that small holdings exist in tea, coffee and rubber plantations also and are in fact the majority of such plantations. For example, in the report of the Plantation Inquiry Commission relating to coffee at pp. 9 and 14 we find that out of the total number of registered estates more than 4,500 are between 5 acres and 25 acres while only about 2,200 861 estates are above 25 acres. Further there are more than 24,000 estates below 5 acres. Similarly at p. 97, Chap. XI, Part III of the Report dealing with rubber, out of the total of over 26, 709 rubber estates, 23,300 are up to 5 acres, 1,900 up to 10 acres and only about 1,500 above 10 acres. So it appears that the large majority of plantations whether they be of coffee or rubber are below 10 acres and that is also the case with area and pepper plantations. Thus there is no reason for giving preference to plantations of tea, coffee and rubber over plantations of area and pepper for the conditions in the two sets of plantations whether for the purpose of ceiling under Chap. III or for the purpose of acquisition of landowners ' rights under Chap. II are the same. The reasons therefore which call for exemption of tea, coffee and rubber plantations equally apply to areca and pepper plantations and there is no intelligible differentia related to the object and purpose of the Act which would justify any distinction in the case of tea, coffee and rubber plantations as against area and pepper plantations. We are therefore of opinion that the provisions relating to plantations are violative of article 14 of the Constitution. The next question is whether these provisions are severable, that is to say, whether the Kerala legislature would have passed the Act without these provisions. That depends upon the intention of the legislature and as far as we can judge that intention from the provisions of the Act, it seems clear to us that the legislature did not intend that the provisions relating to acquisition by tenants and ceilings should apply to plantations as defined in the Act, so that they may have to be broken up with consequent loss of production and detriment to national economy. It seems that the legislature could not have intended in order to carry out the purpose of the legislation to do so even after breaking up all the plantations which 862 existed in the State. It follows therefore that the legislature would not have passed the rest of the Act without the provisions relating to plantations. As these provisions affect the entire working out of Chapter II and III of the Act which are the main provisions thereof, it follows that these provisions relating to plantations cannot be severed from the Act and struck down only by themselves. Therefore, the whole Act must be struck down as violative of article 14 of the Constitution so far as it applies to ryotwari lands in those areas of the State which were transferred to it from the State of Madras, and we order accordingly. Then we come to the attack that the Act is violative of article 14 on account of the manner in which ceiling has been fixed under section 58 thereof. Section 2(12) defines a "family" as meaning husband, wife and their unmarried minor children or such of them as exist. There are three kinds of families existing in this State namely, the joint Hindu family, Marumakhathayam family and Aliyasanthana family, the latter two being matriarchal. In the matriarchal family the husband and wife are not members of the same family but belong to different families. The joint Hindu family does not merely consist of the husband, wife and unmarried minor children; it consists at least of the husband wife and all the children whether married or unmarried and whether minor or adult. The definition of "family" therefore in the Act is an artificial one which does not conform to any of the three kinds of families prevalent in the State. Turning now to section 58, the ceiling has been fixed in two ways. The first is by reference to a family as defined in the Act of not more than five members which is allowed 15 acres of double crop nilam or its equivalent with an addition of one acre of double crop nilam or its equivalent for each 863 member in excess of five, so however that the total extent of the land shall not exceed 25 acres of double crop nilam or its equivalent. The second is by reference to an adult unmarried person who is allowed 7.50 acres of double crop nilam or its equivalent. It has been urged on behalf of the State that the provisions as they stand do not make any discrimination whatsoever for there is the same provision for all adult unmarried persons and the same for all families as defined in the Act. This in our opinion is an over simplification of the provision relating to ceiling under section 58. On an argument of this kind no provision would ever be discriminatory for it is unlikely that a provision would on the face of it make a discrimination. The discriminatory nature of the provision has to be judged from the results that follow from it and we have no doubt that the results which follow from this double provision as to ceiling are bound to be discriminatory. If the ceiling had been fixed with respect to one standard whether it be of an individual person or of a natural family by which we mean a family recognised in personal law, the results may not have been discriminatory. But where the ceiling is fixed as in the present case by a double standard and over and above that the family has been given an artificial definition which does not correspond with a natural family as known to personal law, there is bound to be discrimination resulting from such a provision. A simple illustration will explain how the results of the manner in which the ceiling has been fixed by section 58 will lead to clear discrimination between person and person. Take the case of an adult unmarried person and a minor who is an orphan with no father, mother brother or sister. Assume further that each owns 25 acres of land under personal cultivation. The former who is an adult unmarried person will retain 7 acres and will have to surrender 17.50 acres as excess land. The latter will be an artificial family under the definition of that word 864 in section 2(12). This follows from the fact that a family consists of husband, wife and their unmarried minor children or such of them as exist. This is also made clear by section 61(2) which shows that even a minor who has no parents, and no brothers or sisters will constitute a family under section 2(12). This minor therefore as constituting a family will be entitled to 15 acres of land and will have to surrender only 10 acres as excess land. No justification has been shown to us on behalf of the State for this discriminatory treatment of two individual persons; nor are we able to understand why such discrimination which clearly results from the application of the provisions of section 58(1)is not violative of article 14 of the Constitution. Examples can be multiplied with reference to joint Hindu families also, which would show that in many cases discrimination will result on the application of these provisions to joint Hindu families. Similar would in our opinion be the case with Marumakhathayam and Aliyasanthana families where as we have already pointed out the husband and wife do not belong to the same family as known to personal law. Discrimination therefore is writ large on the consequences that follow from the provisions of section 58(1). We are therefore of opinion that section 58(1) is violative of the fundamental right enshrined in article 14; as that section is the basis of entire Chap. III the whole Chapter must fall with it. This would be an additional reason why Chap. III should be struck down as violative of Art 14 in its application to ryotwari landas which have come to the State of Kerala from the State of Madras. (6) It is contended that the manner in which the compensation is cut down progressively in sections 52 and 64 of the Act is violative of article 14. The Compensation payable under section 52 is determined in this manner. First the purchase price is arrived at under section 45. Thereafter section 52(2)(b) provides that the landowner or the intermediary, except in the 865 case of religious, charitable and educational institution of a public nature, would be entitled to compensation. The compensation would consist of (1) the value of structures, wells and embankments of a permanent nature situated in the land and belonging to the landowner or the intermediary, as the case may be, and (2) the percentage of the value of interest of the landowner or the intermediary in respect of the land and the improvements other than those falling under sub cl. (i) according to the scales specified in Sch. Schedule II then provides that the first Rs. 15,000/ . of the compensation will be paid in full. Thereafter there will be a reduction of 5 per cent. in each slab of Rs. 10,000/ till we reach compensation above Rs. 1,45,000/ Thereafter the compensation arrived at under section 52 read with section 45 is reduced by 70 per cent so that the landowner or the intermediary gets only 30 per cent of what has been arrived at under section 52 (2) (b) read with section 45. Similarly in section 64 the compensation payable for excess land surrendered is (i) the full value of any structures, wells and embankments of a permanent nature situate in the land and belonging to the person who surrenders such land, and (ii) the percentage of the market value of the land and improvements other than those specified above. Here again on the first Rs. 15,000/ compensation at 60 per cent is to be paid. Thereafter the compensation is reduced by 5 per cent for each slab of Rs. 15,000/ till we reach over Rs. 1,75,000/ when the compensation is reduced by 75 per cent. The contention on behalf of the petitioners is that there is no intelligible differentia on which the purchase price determined under section 45 or the market value is to be reduced by different percentages depending on the total purchase price or the total market value of the interest to be acquired. The reply on behalf of the State is that there is really no discrimination inasmuch 866 as the same percentage is reduced where the compensation payable to different persons is the same. That is undoubtedly so. But that alone is not in our opinion the end of the matter. The question which is posed for our consideration is why a person in whose case the purchase price or the market value Rs. 15,000/ should get the full purchase price or suffer a reduction in the market value at a certain rate while another person in whose case compensation is more than Rs. 15,000/ should suffer reductions at a different rate which reductions become progressively higher as the purchase price or the market value increases. We could understand once the purchase price or the market value had been determined a uniform cut therefrom for all persons entitled to compensation. That would then raise the question of adequacy of compensation and unless the cut was so large as to make the compensation illusory the cut may be protected by Art.31(2). But in the present case there is not a uniform cut on the purchase price or the market value for all persons, the cut is higher as the purchase price or the market value gets bigger and bigger after the first slab of Rs. 15,000/ . This difference in cut in being justified on behalf of the State on the same principle on which (for example) the slab system exists for purposes of income tax. We are however of opinion that there is no comparison between the slab system of income tax rates and the present cuts. Taxation is a compulsory levy from each individual for the purpose of the maintenance of the State. We may therefore reasonably expect that a rich man may be required to make a contribution which may be higher than what may be proportionately due from his income for that purpose as compared to a poor man. This principle cannot be applied in a case where a person is deprived of his property under the power of eminent domain for which he is entitled to compensation. There is no reason why when two persons are deprived of their property one richer than the other, they should be paid at 867 different rates when the property of which they are deprived is of the same kind and differs only in extent. No such principle can be applied in case where compensation is being granted to a person for deprivation of his property. Where one person owns property valued at Rs. 15,000/ while another owns property valued at Rs. 30,000/ , both are equally deprived of the property. When therefore it comes to a question of payment of compensation we can see no reason why a person whose compensation amounts to Rs. 15,000/ should get the whole of it or a large part of it while another person whose compensation amounts to (say) Rs. 30,000/ should get something less than the first person. It is not as if there is some difference in the nature of the property which might justify different payments of compensation. What the Act provides is to work out the purchase price or the market value first for the purpose of determining compensation and then make different cuts from the purchase price or the market value according to whether in one case the purchase price or the market value is Rs. 15,000/ and in another case it is more than Rs. 15,000/ . No justification, is pointed out for this discrimination except the principle on which the slab system for the purpose of income tax is justified. That principles as we have just pointed out does not apply to a case of compensation. Nor are we able to see any rational classification which would justify different cuts based simply on the amount of compensation worked out on the basis of purchase price or market value. The only thing we can see is that because a person is possibly richer he must be paid less for the same type of land while a person who is poorer must be paid more. This kind of discrimination in the payment of compensation cannot in our opinion be possibly justified on the objects and purposes of the Act. The object and purpose of the Act, as we have already said, is to grant rights to cultivating tenants so that they may 868 improve their lands resulting in larger production to the benefit of the national economy. Secondly, the object of the Act is to provide land for the landless and to those who may have little land by taking excess land from those who have large tracts of lands so that peasant proprietorship may increase with consequent increase in production due to greater interest of the cultivator in the soil. But these objects have no rational relation which would justify the making of different cuts from the purchase price or the market value for the purpose of giving compensation to those whose interests are being acquired under the Act. We can therefore see no justification for giving different compensation based on different cuts from the purchase price or the market value as provided in sections 52 and 64 of the Act. We may in this connection refer to Kameshwar Singh vs The State of Bihar (1), in which similar question with respect to compensation provided in the Bihar Land Reforms Act, 1950, came up for consideration. There the Act provided compensation at different rates depending upon the net income. The landowner having the smallest net income below Rs. 500/ was to get twenty times the net income as compensation while the landowner having the largest net income, i. e., above 1,00,000/ was to get only three times of the net income. Intermediate slabs provided different multiples for different amounts of net income. That provision was struck down by the Special Bench of the Patna High Court as violative of article 14. It may be mentioned that decision was given before the Constitution (First Amendment) Act adding article 31A and the Ninth Schedule to the Constitution was passed. Three learned Judges composing the Special Bench who heard that case were unanimously of the 869 opinion that such difference in payment was violative of article 14 and the principle of progressive taxation did not apply to compensation for land acquired. We are of opinion that the view taken in that case is correct and the same applies to the present case. We may point out that case came in appeal to this Court (see, The State of Bihar vs Maharajadhiraja Sir Kameshwar Singh (1) ). The appeal however was heard after article 31A and the Ninth Schedule had been introduced in the Constitution and therefore this Court had no occasion to consider whether such difference in payment of compensation would be violative of article 14. We are therefore clearly of opinion that the manner in which progressive cuts have been imposed on the purchase price under section 52 and the market value under section 64 in order to determine the compensation payable to land owners or intermediaries in one case and to persons from whom excess land is taken in another results in discrimination and cannot be justified on any intelligible differentia which has any relation to the objects and purposes of the Act. As the provision as to compensation is all pervasives, the entire Act must be struck down as violative of article 14 in its application to ryotwari lands which have come to the State of Kerala from the State of Madras. In view of what we have said above on the main points urged in the petitions, it is unnecessary to consider other subsidiary points attacking particular sections of the Act on the ground that they were unreasonable restrictions on the right to acquire, hold and dispose of property under article 19(1)(f). We therefore allow the petitions and strike down the Act in relation to its application to ryotwari lands which have come to the State of Kerala from the State of Madras. The petitioners will get their costs from the State of Kerala, one set of hearing costs. 870 SARKAR, J. I wish to say a few words on two of the questions that arise in these cases. The Act, the validity of which is challenged, provides for acquisition of lands for equitable distribution among the people who require it for cultivation by themselves. It provides for payment of compensation to those whose interests are acquired. It also provides for a mode of valuation of these interests. Then it provides by sections 52 and 64 for payment of compensation at a progressively smaller rate for larger valuations. For the higher slabs in the valuation made as provided by the Act, less and less is paid by way of compensation. It is said that these provisions for progressively diminishing compensation are discriminatory and unconstitutional. This is the first point with which I propose to deal. The question is whether the payment of compensation at a progressively smaller rate as the valuation is higher offends article 14 of the Constitution. Now it is not disputed that progressively higher rate of taxation by an Act taxing income is not unconstitutional. I think such taxation is too well recognised now to be challenged. If that is so and that was the basis on which arguments proceeded in this case I am unable to see that a statute providing for acquisition of property and for payment of compensation at a progressively lower rate for the higher slabs of valuation can be unconstitutional. "The reason for progressive taxation in the case of inheritance taxes and income taxes is the ability of those receiving or giving to pay": Willis 's Constitutional Law (1936 ed.) p. 597. The cases in America that I have looked up also put the matter on the same basis. The classification by progressively higher taxation in a taxing statute is therefore good if based on the tax payers ' ability to pay. It is however said that what applies in the case of a taxing statute cannot apply to a statute 871 permitting acquisition of property on payment of compensation. I do not see why ? I am not aware that the test for determining whether there has been unequal treatment is different with different varieties of statutes, that the test for a taxing statute is not the same as that for a statute providing for acquisition on payment of compensation. I think the test is the same for all statutes, and it is that there must be an intelligible differentia having a rational relation to the object of the Act. Now the object of a taxing statute is to collect revenue for the governance of the country. Ability to pay is acknowledged to be an intelligible differentia having a relation to such an object. The object of the statute with which we are concerned is to acquire land on payment of compensation so that the land may be equitably distributed among the people. If under a statute whose object is to collect revenue more can be legitimately demanded from a person having more, it seems to me that under a statute whose object is to acquire land by paying compensation less can equally legitimately be paid to a person who has more. Ability to pay, or which is the same thing as ability to bear the loss arising from smaller payment received, would in either case be an intelligible differentia having a rational relation to the object of the Act. In one case it serves the object by collecting more revenue for adding to the resources for governing the country and in the other case it serves the object by making it possible for the State by payment of less money out of its resources to acquire lands for better distribution. In both cases the State resources are benefited, in one by augmentation and in the other by prevention of larger depletion. Therefore, I would accept the learned Attorney General 's argument that sections 52 and 64 of the Act cannot be held to be discriminatory and void for the same reason on which 872 progressive rates of taxation are held not to be so in the case of an Income tax Act. The next question on which I wish to say a few words concerns those provisions of the Act which exempt plantations of tea, coffee, rubber or cardamom or such other kinds of special crops as the Government may specify, from certain provisions of the Act. Plantations have been defined in section 2(39) of the Act as land used by a person principally for the cultivation of tea, coffee, rubber or cardamom or other notified crops. No other crop appears to have been notified yet. Section 58 of the Act provides the ceiling area of land which may be held by any individual proprietor. Land above the ceiling has to be surrendered to the Government. Section 57 of the Act provides that this provision would not apply to plantations as defined in section 2(39). Again, Ch. 2 of the Act which gives the tenants the right to purchase land from the landlords and vests in the Government the lands of the landlords not themselves cultivating them above the ceiling fixed, is by section 3 (viii) not made applicable to plantations exceeding thirty acres in extent. The question is whether the benefit so given to the plantations as defined in the Act is discriminatory. The petitioners own large scale cultivation of areca and pepper. They contend that no legitimate differentiation is possible between lands on which areca and pepper are grown and lands on which tea, coffee, rubber and cardamom are grown. No doubt the presumption is that a statute is constitutional but such presumption is not conclusive. It is also true that a court is entitled to assume the existence of all rational basis on which the classification made by an Act may be justified. Even so, it seems to me, that the present classification is, on the materials now before us not justified. It may be that plantations of tea, coffee 873 rubber and cardamom, especially the first three, are usually large in size and require big investments. It may be that they are carried on as industries which give employment to a large labour force. These characteristics may however only justify the putting of large plantations of these crops in a class. The Act however exempts all lands on which tea, coffee, rubber or cardamom is grown irrespective of the size of the business carried on or of labour employed on them, as a class. Materials have been placed before us to show that there are a very large number of smaller plantations growing tea, coffee and rubber. There are also many areca and pepper plantations exceeding thirty acres in area. There is no reason to put tea, coffee, rubber and cardamom plantations in a class as distinguished from similar sizes of plantations of areca and pepper. None at least has been shown by the State of Kerala to exist. The only ground shown in the affidavit of the State of Kerala seeking to justify the classification of tea, coffee, rubber and cardamom plantations in one class is that "plantation crop is generally understood to refer only to tea, coffee, rubber and cardamom" and that "areca and pepper are not generally grown on a plantation scale". I am unable to think that these afford sufficient justification for making a discrimination in favour of tea, coffee, rubber and cardamom plantations. It would appear from the Planning Commission 's Report that other kinds of crops might profitably be grown as plantation crops. In any case, a general understanding even if there was one, is not sufficient basis for discrimination. With regard to the other statements of the State, it is enough to say that the Act does not make a discrimination because of the size of the plantations. Therefore, there is no point in saying that areca and pepper are not grown on a plantation scale. For these reasons I think the provisions in the Act making a discrimination in favour of tea, 874 coffee, rubber and cardamom plantations cannot be upheld. For the same reason, I think the discriminatory treatment made in favour of cashew plantation also cannot be sustained. Sections 3(viii), 57(1)(d) and 59(2) of the Act are therefore, in my opinion, invalid. I think however that these provisions are severable from other parts of the Act. I think it cannot be reasonably said that the legislature would not put the Act into operation if these provisions are taken out of it. The deletion of the provisions does not further make it impossible for the rest of the Act to operate. I am, therefore, unable, to hold that because the sections mentioned above are bad, the whole Act should be declared to be bad. That is all I wish to say in this judgment. With regard to the other matters arising in this case, I agree with the judgment delivered by Wanchoo J. AYYANGAR, J. I entirely agree with the order that the petitions should be allowed and the impugned Act struck down in relation to its application to ryotwari lands which came into the State of Kerala from the State of Madras this being the only relief which the petitioners seek from this Court. My only reason for this separate judgment is because I do not agree with that portion of the reasoning in the judgment just now pronounced in these petitions where it deals with the interpretation of article 31A(2). In my judgment in the companion case Writ Petition No. 105 of 1961 I have endeavored to point out what according to me is the proper construction of this Article and I adhere to that view. I consider that on article 31A(2) as it stands even after the fourth Amendment, properties held on ryotwari tenures and the interest of the royt in such lands would not be "estates" for the purposes of that Article. No doubt as pointed out by me in the 875 other judgment, if there was a law existing on the date of the Constitution in relation to land tenures under which "estate" were defined as including not merely lands held by intermediaries and of others holding under favourable tenurers, but also of ryotwari proprietors having direct relationship with the Government and paying full assessment, such latter category of interests might also be comprehended within the term "estate" by reason of the words "have the same meaning as that expression. .has in the existing law relating to land tenures in force in that area" in Art.31A(2)(a). That is the real basis and the ratio underlying the decisions of this Court in Ram Ram Narain Medhi vs State of Bombay(1), and Atma Ram vs State of Punjab(2). In all other cases (apart from the two categories specially added by the Fourth Amendment) no lands other than those held by intermediaries or held on a favourable tenure would fall within the definition of "an estate" this being according to me the central concept or the thread which runs through the entire definition. The choice between the different interpretations of the Article does not however present itself for the disposal of this petition which has to be answered in favour of the petitioner even on the view of the scope of article 31A which has commended itself to my colleagues. Where an "existing law in relation to land tenures in force in an area" contains a definition of an "estate" and that definition excludes the interest of a roytwari proprietor, the very words of Art.31A(2)(a) which I have extracted earlier would negative the applicability of its provisions to that tenure. article 31A being out of the way I agree that the provision in (1) section 2 (39) of the Act which by definition excludes pepper and areca plantations from the category of the plantations which are named in it which are exempted from the operative provisions of the impugned Act, (2)s. 58 for the 876 determination of the ceiling in respect of different individuals who are brought within the scope of the enactment, and (3) ss.52 and 64 for determining the compensation payable to the several classes of persons whose lands are acquired under Act, all these are violative the guarantee of the equal protection of laws under article 14 of the Constitution. I therefore agree in the order proposed that the petitions be allowed, and with costs. Petitions allowed.

The Kerala Agrarian Relations Act was impugned on various grounds. ^ Held, (per Gajendragadkar, Wanchoo and Das Gupta, JJ.) that (1) the bill which was originally passed by a Legislative Assembly which as dissolved and was reconsidered and re passed by a new legislative assembly did not lapse and validly became the law when the President assented to it after it was passed by the second legislative assembly. 830 Purushothaman Nambudiri vs State of Kerala, [1962] Supp. 1 S.C.R. 753, followed. (II) The Act which made certain deductions from the compensation payable to the landholders under Ch. II and to others who held excess land under Ch. III cannot be struck down as a piece of colourable legislation which is beyond the competence of the State Legislature, and it cannot be said that any device has been employed in the Act to take away the moneys of the landowners or the persons from whom excess land is taken away for the purpose of adding to the revenue of the State. Section 80 of the Act provides for the Constitution of an agriculturist rehabilitation fund for the purpose of rendering help by way of loan, grant or otherwise to persons affected by the Act and eligible for the same under the rules but rr. 161 (a) (III) and 161 (b) (III) are so framed as to take within their scope even persons not affected by the Act. Those rules are ultra vires of section 80 and must be struck down. (III) The lands held by ryotwari pattadars in the area which came to the State of Kerala by virtue of the States Reorganisation Act from the State of Madras are not 'estates ' within the meaning of article 31A(2)(a) of the Constitution and therefore the Act is not protected under article 31A (1) from attack under articles 14, 19 and 31 of the Constitution. State of Bihar vs Rameshwar Pratap Narain Singh, ; , referred to. (IV) The reasons which call for exemption of tea, coffee and rubber plantations from certain provisions of the Act equally apply to areca and pepper plantations and there is no intelligible differentia related to the object and purpose of the Act which would justify any distinction in the case of tea, coffee and rubber plantations as against areca and pepper plantations. The provisions in the Act relating to plantations are violative of article 14 of the Constitution. The provisions relating to plantations cannot be severed from the Act and struck down only by themselves. The whole Act must be struck down as violative of article 14 of the Constitution so far as it applied to ryotwari lands in those areas of the State which were transferred to it from the State of Madras. (V) The manner in which ceiling has been fixed under section 58(1) is violative of the fundamental right enshrined in article 14 of the constitution and as that section is the basis of entire Ch. III the whole chapter must fall with it 831 (IV) The manner in which progressive cuts have been imposed on the purchase price under section 52 and the market value under section 64 in order to determine the compensation payable to landowners or intermediaries in one case and to persons from whom excess land is taken in another, results in discrimination and cannot be justified on any intelligible differentia which has any relation to the objects and purposes of the Act. The provision as to compensation is all pervasive and the entire Act must be struck down as violative of article 14 of the Constitution in its application to ryotwari lands which have come to the State of Kerala from the State of Madras. Per Sarkar, J. Sections 52 and 64 of the Act which provide for payment of Compensation at progressively smaller rates for larger valuations of the interests acquired are not invalid as offending article 14 of the Constitution. The provisions in the act making a discrimination in favour of tea, coffee, rubber and cardamom plantation and also in favour of cashew plantations cannot be upheld. Sections 3(viii), 57 (1) (d) and 59 (2) are therefore invalid. These are however severable from the other parts of the Act and the whole Act cannot be held to be bad merely because those provisions are bad. Per Ayyangar, J. Properties held on ryotwari tenures and the interest of the ryot in such lands would not be "estate" for the purposes of article 31A(2) as it stood even after the Fourth Amendment of the Constitution. Where an existing law in relation to land tenures in force in an area contains a definition of an 'estates ' and that definition excludes the interest of a ryotwari proprietor, the very words of article 31A(2) of the Constitution negatived the applicability of its provisions to that tenure. Ram Ram Narain Medhi, vs State of Bombay, [1959] Supp. I S.C.R. 489 and Atma Ram vs State of Punjab, [1959] Supp. I S.C.R. 748, referred to. Section 2(39) which by definition excludes pepper and areca plantations from the category of the plantations named in it which are exempted from the operative provisions of the impugned Act, section 58 for the determination of the ceiling in respect of different individuals who are brought within the scope of the enactment and sections 52 and 64 for determining the compensation payable to the several classes of persons whose lands are acquired under the Act are all violative of the guarantee of equal protection of laws under article 14 of the Constitution.

Civil Appeal No. 225 of 1960. Appeal from the judgment and decree dated April 19, 1957, of the Madhya Pradesh High court (Indore Bench) at Indore in Civil Reference No. 1 of 1952. B. Sen, B.K.B. Naidu and I.N. Shroff, for the appellant. A. V. Viswanatha Sastri, K. A. Chitale, J. B. Dadachanji, section N. Andley, Rameshwar Nath and P. L. Vohra, for the respondents. 1961, December, 20 The Judgment of the Court was delivered by AYYANGAR, J. This appeal comes before us by virtue of a certificate of fitness granted by the High Court of Madhya Pradesh under section 47(2) of the 245 Gwalior War Profits ordinance, Samvat 2001 (hereafter called the Ordinance) on the ground that the appeal involves a substantial question of law. The question of law which arises in the appeal relates to the proper construction of r. 3(1) of the Schedule of the ordinance. The respondent M/s. Binodiram Balchand is the name under which a Hindu undivided family which wag resident in the State of Gwalior carried on various businesses in that State. Profits derived from business carried in the State were charged to War Profits Tax under the ordinance. Among the businesses carried on by the respondent was its employment as the Secretary Treasurer and Managing agent of a textile mill which was a limited company bearing the name of Binod Mills Company Limited, Ujjain. The appeal is concerned with the computation of the profits of the respondent to War Profits Tax under the ordinance, which it might be stated at the outset, was on lines very similar to the Indian Excess Profits Tax Act, 1940. The chargeable accounting period with which the appeal is concerned, is the period commencing from July 1, 1944, to. October 16, 1944. The respondent assessee submitted its return and thereafter the War Profits Tax officer by his assessment order dated July 9, 1951, determined the taxable income of the assessee for this chargeable accounting period at Rs. 12,16,145/ and assessed it to tax in the sum of Rs. 2,02,691/ . Several points were raised in relation to this assessment order by the respondent, and one of them related to the inclusion in its assessable profits of a sum of Rs. 11,09,332/ which was received by the respondent on July 5, 1944, being the dividend declared and paid by the Binod Mills Ltd" for 1943 on the shares held by the respondent. It was the contention of the respondent that this sum was its income from an investment pure and simple and was not 246 "profits" from business, and so could not be included in its taxable profits on a proper construction of the relevant provisions of the ordinance. From the assessment order the respondent filed an appeal to the appellate authority which however was unsuccessful. A revision to the Commissioner of War Profits Tax met with the same fate and thereafter the respondent prayed for a reference to the High Court under section 46(1) of the ordinance which ran thus: `46(1) If, in the course of any assessment under this ordinance or any proceeding in connection therewith, a question of law arises, The Commissioner, may; either on his own motion or on reference from any War Profits Tax authority subordinate to him, draw up statement of the case and refer it with his own opinion thereon to the High Court. " The Commissioner acceded to this request and referred for the opinion of the High Court three questions:, "(1) Whether the dividend income of Rs. 11,09,332/ received from the Binod Mills was chargeable under the War Profits Tax ordinance ? (2) Whether certain bad debts written off by the assessees could be allowed as deductions in computing profits for war tax purpose? (3) Whether the expenses of assessees ' branch at Gwalior which was defunct, could be allowed as admissible expenses ?" The High Court answered questions 2 and 3 in favour of the department, but the first question was answered in the negative and in favour of the assessee. There is now no dispute as regards questions 2 & 3 and the appeal is confined to the correctness of the answer to the first question. 247 Before setting out the grounds upon which the High court decided the reference in favour of the respondent it is necessary to read a few of the provisions of the relevant law which bear upon the point arising for consideration. The preamble to the ordinance recites that it was enacted to impose a tax on "excess profits arising out of certain businesses" and this intention is carried out by section 4(1) which is the charging section which enacts: "4(1) Subject to the provisions of this ordinance, there shall, in respect of any business to which this ordinance applies, be charged, levied and paid on the amount by which the profits during any chargeable period exceed the standard profits, an excess profit tax (in this ordinance referred to as the War Profits Tax ') which shall be equal to 60 per cent. of the aforesaid amount. " The expression `business ', the profits derived from which are thus brought to charge is defined by section 2(5) in these terms: "2(5) `business ' includes any trade, commerce or manufacture or any adventure in the nature of trade, commerce or manufacturer or any profession or vocation, but does not include a profession carried on by an individual or by individuals in partnership, if the profits of the profession depend wholly or mainly on his or their personal qualifications, unless such profession consists wholly or mainly in the making of contracts on behalf of other persons or the giving to other persons of advice of a commercial nature in connection with the making of contracts: Provided that where the functions of a company or of a society incorporated by or under any enactment consist wholly or mainly in the holding of investments or other property or both, the holding thereof shall be 248 deemed for the purpose of this definition to be a business carried on by such company or society; Provided further that all businesses to which this ordinance applies carried on by the same person shall be treated as one business for the purposes of this ordinance;" There are two further definitions which are of some relevance to the arguments addressed to us and might therefore be set out at this stage. Section 2(14) defines the expression `prescribed ' as meaning "prescribed by Rules made under the ordinance;" section 50 being the provision empowering the Government make rules and this section ran: "50(1) Subject to the provisions of this ordinance, Government may make rules for carrying out the purposes of this ordinance. (2) Rules made under this section shall be published in the official Gazette and shall thereupon have effect as if enacted in this ordinance. " The other relevant definition is of the expression profits ' which is defined in section 2 (16) as: "profits as determined in accordance with the provisions of this Ordinance and its first schedule;" There is a First Schedule which follows the ordinance and which is headed 'Rules for the computation of profits for the purposes of War Profits Tax ', and of these the one pertinent to the matter in controversy in the appeal is r. 3 of which sub rs. (1) and (2) have been relied on in the course of arguments. They run: "3(1)Income received from investments shall be included in the profits of a business liable to the War Profits Tax, unless it is proved to satisfaction of the War Profits 249 Tax Officer that the investments have no connection whatever with the business. (2) In the case of a business which consists wholly or mainly in the dealing in or holding of investments, income received from investments shall be deemed to be profits of that business, and in the case of a business, a specific part only of which consists in dealing in investments, the income received from investments held for the purpose of that part of the business shall be deemed to be profits of that part of the business. Explanation: 'The income from investments to be included in the profits of the business under the provisions of this rule shall be computed exclusive of all income received by way of dividends or distribution of profits from a company carrying on a business, to the whole of which the Section of the Ordinance imposing the War Profits Tax applies". Pausing here, it is necessary to mention that in relation to the first question regarding the inclusion of the dividend income in the taxable profits of the assessee three contentions were raised on behalf of the respondent which are thus set out in the judgment under appeal: "(1) The assessees did not deal in shares and their holdings in the Binod Mills Limited, were purely in the nature of investments, having no connections with their business as defined in Section 2(5) read with Rule 1 of Sch. I of the Gwalior War Profits Tax Ordinance. The business of the Secretaries, Treasurers and Agents of the Binod Mills Limited, which was carried on by them did not require any holding of the shares of the company and 250 was not dependent on their investment in the said company. (2) The dividend income accrued or arose from the profits of the Binod Mills Limited, and as the Ordinance applied to the business carried on by this company, the dividends were excluded under the explanation to Rule 3(1) of Schedule I. (3) The dividend income should be considered as income of the full accounting period, i.e. from Diwali of 1943 to Diwali of 1944 and should be apportioned on that basis. " The learned Judges of the High Court dealt only with the first of the above contentions, and having accepted it, considered it unnecessary to express any opinion on the other two. We may now proceed to state the grounds upon which the learned Judges of the High Court answered this contention in favour of the respondent. It was urged before them by the respondent that though the provisions headed 'Rules for the computation of business ' purported to be part of the Ordinance itself as forming the Schedule to the Ordinance, they were in reality rules made by government under the rule making power conferred on it by section 50 of the Ordinance, This argument was accepted apparently being aided by the fact that immediately after the title "Schedule I" occur the words "See Section 2(14)". Proceeding on this basis the reasoning of the learned Judges was on these lines. The charge under section 4(1) was on the profits of a business and unless an activity which resulted in any income derived was one in the nature of trade, the mere fact that income was derived therefrom would not make it assessable to tax under the ordinance. This they deduced from an interpretation of the words used in the charging section read in conjunction with the definition of "profits" in section 2(16). The next question was whether 251 the dividend which the respondent obtained from the shares held by it in the Binod Mills Ltd., of which it was the Secretary, Treasurer and Managing agent were profits derived by any business activity. Unless the acquisition of the shares was an adventure in the nature of trade or the respondent was a dealer in shares, such that the shares held by it were part of its stock in trade, the income derived therefrom by way of dividends could not be characterised as profits from business. If this was the result on a proper construction of the Act the question the learned Judges addressed themselves to next was, whether r. 3(1), which according to them was a piece of subordinate legislation, could validly bring to charge an item of income which was not within the scope of the Ordinance itself, and this had necessarily to be answered in the negative. They consequently held that r. 3(1) of the 1st Schedule was beyond the power of the rule making authority under section 50 of the Ordinance and answered the first question referred to them in favour of the assesssee. Mr. Sen, learned Counsel for the appellant has however placed before us material to show that Sch. I containing the rules for the computation of profits were not rules made by the Government under section 50 of the Ordinance but was really part of the Ordinance itself. In the first place, it has to be noted that section 2(16) speaks of Sch. I to the Ordinance, and admittedly besides the one now produced before us there was no other Schedule attached to the Ordinance. It is impossible to hold that with section 2(16) in the form in which we now find it, the rules for the computation of the business did not form part of the Ordinance having been enacted simultaneously as part and parcel thereof. In this connection it might be pointed out that the Excess Profits Tax Act, 1940, which formed the basis or model upon which the Ordinance was fashioned has 252 a similar Schedule headed "Rules" for the computation of profits" and the Schedule formed part of that Act. The only ground for even a suspicion that Sch. I was not a part of the Ordinance itself is the reference to section 2 (14) in the heading of these rules just below the words Schedule I, but very little assistance can be sought from this reference, because section 2(14) in not itself the source of power for making rules which is section 50 of the Ordinance and, in fact, rules have been made under the power conferred by section 50 of the Ordinance; vide War Profits Tax Rules Samvat 2001, No. 65 dated December 26, 1944, which carries the recital in the following terms: "In exercise of the powers conferred by section 50 of the War Profits Tax Ordinance the Government of Gwalior are pleased to make the following rules. " It is obvious therefore "section 2(14) in Sch. I is a mistake or a misprint for "section 2(16)" and it might be noted that in the corresponding Schedule to the Indian Excess Profits Tax Act, 1940, immediately after the title "Schedule I" occur the words "See section 2(19)" which in that enactment corresponds to section 2(16) of the Ordinance. There are other circumstances to which Mr. Sen has drawn our attention which also point to the Schedule being part of the Ordinance and not rules made under section 50. The Schedule was the subject of amendments more than once and each time this was done it is significant that this was done not by virtue of the exercise of the rule making power under section 50 of the Ordinance but by further ordinances showing clearly that the Schedule was part of the Ordinance itself. To give just a few example, the Explanation to r. 3(2) which we have extracted earlier was not in the Schedule as originally enacted but was introduced as 253 an amendment by Ordinance No. 42 dated February 28, 1946. The short title of this Ordinance runs: "This Ordinance might be called the Gwalior War Profits Tax (Amendment) Act, Samvat 2002". Further it would be noticed that in the Explanation there is a comma after the words "carrying on a business". That comma was not there when the schedule was amended by the Amending ordinance of February 28. 1946, but was introduced by Ordinance 5 of Samvat 2004 and the short title of this second Ordinance reads: "This Ordinance might be called the Gwalior War Profits Tax (Amendment) Ordinance Samvat 2004". We do not consider it necessary to dilate on the point as we are clearly of the opinion that the Schedule was part of the Ordinance and has therefore to be read not as subordinate legislation under r. 50 but as part and parcel of the Ordinance itself. The whole basis therefore of the reasoning upon which the learned Judges of the High Court proceeded falls to the ground and the only question is whether accepting the respondent 's case that the shares held by it in the Binod Mills Ltd. were really part of its investments, these investments have "any connection" with its business. It is common ground that the respondent was the Secretary, Treasurer and Managing agent of the Binod Mills and what we are now concerned with are the shares held by it in that company. In the case of every assessee who carries on a business activity and is in receipt of profits from that business, on the terms of r. 3(1) income from every investment held by him is liable to be included in the profits assessable to tax unless such person was able to satisfy the 254 revenue authorities that the investments had "no connection whatever" with his business. Mr. Viswanatha Sastri, learned Counsel for the respondent sought to overcome this position by submitting that the "connection" contemplated by the rule was a direct "connection" and not a remote or fanciful one and that in the present case there was really no connection between the respondents ownership of these shares and the office of managing agent which it held. His contention was that except the fact that the recipient of the profits from the "business" of managing agency and of the dividend income was the same, there was no other connection between the one and the other. In further elaboration of his point, he invited us to hold that the "connections would be direct only where the investment was related to a business activity as cause and effect or as a sine qua non. Thus if it was a requirement either of the Articles of Association of the company or of the Managing Agency Agreement, that the managing agent should be a shareholder, or the holder of specified number of shares, then alone, learned Counsel contended, the managing agent being dependent on the shareholding, there would be that connection which would bring the dividend income with in the expanded definition of profits from business under r. 3(1). In all other cases where shares were held, without the assessee being obliged to hold them for the purpose of his business activity, no distinction, Counsel submitted, could be drawn between the investment in the shares of a company with which he had nothing to do, and a company which he managed under an agreement. Learned Counsel further stressed that the case of the respondent was stronger because the Managing Agency Agreement with the respondent was to last so long as the respondent firm existed and carried on business in that name and could not be terminated by the company "save and except when the agent being 255 found guilty of fraud in the Management or in the discharge of their duties." and having regard to this security of tenure which the respondent enjoyed, the holding of these shares had no connection whatever with the business of managing agency. We find ourselves unable to accept this interpretation of r. 3(1). The relevant words in the rule being "any connection whatever" it would not be giving proper effect to the meaning of the words "any" and "whatever" to restrict it to cases of "direct connection" in the sense suggested on behalf of the respondent. But this apart, by the number of shares which the respondent owned in the mills it is admitted that it obtained a controlling interest it held the majority of the shares in the company. The respondent was therefore enabled by reason of this investment to control the action of the company which was the other party under the Managing agency Agreement. This control was capable of being used to further the interests of the Managing agent in its relations with the company and whether or not this was used for obtaining advantages, it would certainly be available for avoiding any disadvantages arising from misunderstandings with the company. It could not be denied that the control would certainly be useful to keep the relations between the company and the Managing agent smooth so as to enable the Managing agent to earn his commission etc. without differences or disputes. Even if therefore the word "connection" in r. 3(1) meant a "direct" connection a construction which we do not adopt it appears to us that the present case satisfied even that test. In any event the "connection" is not anything remote, fanciful or imaginary, but on the other hand real and capable of being turned to good account. It certainly cannot be equated with the holding of shares by the respondent in a company with which he had no connection other than as a shareholder. 256 We are therefore of the opinion that the dividend received by the respondent from the Binod Mills Ltd., was properly included by the assessing authorities in the computation of the taxable profit of there respondent under the Ordinance and that the High Court erred in answering the reference in favour of the assessee. We have already pointed out that the High Court did not deal with or express any opinion on the two subsidiary contentions urged by the respondent with reference to the first question. Those points were also naturally not argued before us and we do not express any opinion on them. It is obvious that the reference cannot be disposed of without deciding these contentions and the case would have to be remanded to the High Court for dealing with these subsidiary points. The appeal will accordingly be allowed, the judgment of the High Court set aside and the first contention in relation to question No. 1 answered against the assessee and in favour of the appellant and the case remanded to the High Court for the consideration of the other contentions with reference to that question. The appellant will be entitled to his costs here. The costs in the High Court will be provided in its final order. Appeal allowed.

Rule 3 (1) of such. I of the Gwalior War Profits Tax ordinance, Samvat 2001 provided: "Income received from investments shall be included in the profits of a business liable to the war Profits Tax, unless it is proved to satisfaction of the War Profits Tax officer that the investments have no connection whatever with the business." The respondent, a Hindu undivided family, was carrying on various businesses in the erstwhile State of Gwalior, and one of them was its employment as the Secretary, Treasurer and Managing Agent of, a limited company. The respondent held a majority of the issued shares in the company. For the accounting period July 1, 1944, to October 16, 1944, the War Profits Tax officer by his assessment order dated July 9, 1951, included in its assessable profits the sum received by the respondent on July s, 1944, as the dividend declare and paid by the company on its shares. The respondent claimed that the said sum could not be included in its taxable profits on the ground that it did not deal in shares and that its holdings in the company were purely in the nature of investments having no connection with its business as defined section 2(5) of the ordinance Gwalior War Profits ordinance and that the business of the Secretaries, Treasurers and Managing Agent of the company which was carried on by it did not require any holding of the shares of the company and was not dependent on its investment in the said company. The High Court of Madhya Pradesh took the view (1) that on a proper construction of the provisions of the ordinance, unless the acquisition of the shares was an adventure in the nature of trade or the respondent was a dealer in shares such that the shares held by it were part of its stock in trade, the income derived therefrom by way of dividends could not be characterised as profits from business, and (2) that Sch. I of the Ordinance which 244 was headed "Rules for the computation of business", though it purported to be part of the Ordinance, in reality comprised rules made by Government under the rule making power conferred on it by section 50 of the ordinance and that r. 3 (I) of the Schedule, being subordinate legislation could not validly bring to charge an item of income which was not within the scope of the ordinance itself. ^ Held that : Schedule I of the Gwalior War Profits Tax Ordinance was part and parcel of the ordinance itself and, therefore, could not be considered to be subordinate legislation as rules framed under section 50 of the ordinance (2) the word "connection" in r. 3 (1) of Sch. I of the Ordinance was not restricted to cases of "direct connection", in view of the expression "no connection whatever" in that rule; and (3) the respondent as the holder of the majority of the shares in the company, was enabled by reason of this investment to control the action of the company which was true other party under the Managing Agency Agreement, and therefore, the investment was connected with the business carried on by it within the meaning of r. 3(1) of Sch. I of the ordinance. Accordingly, the dividend received by the respondent from the company was properly included by the assessing authorities in the computation of its taxable profits under the ordinance.

minal Appeal No . 67 of 1952. Appeal by special leave from the Judgment and Order dated the 14th September, 1951, of the High Court of Judicature for the State of Punjab at Simla (Bhandari and Soni JJ.) in Criminal Appeal No. 361 of 1950, arising out of Judgment and Order dated the 13th May, 1960, of the Court of the Sessions Judge, Ferozepore, in Trial No. 28 of 1950 and Case No. 5 of 1950. P. section Safeer for the appellant. Gopal Singh for the respondent. December 10. The Judgment of the Court was delivered by MAHAJAN J. Ajmer Singh, a young man of about 22 years of age was tried for the murder of Bagher Singh, his first cousin, and was acquitted by the Sessions Judge of Ferozepore by his judgment dated 13th May, 1950. On appeal by the State Government, the order of acquittal was set aside by the High Court and the appellant was convicted under section 304, Indian Penal Code, and sentenced to ten years ' rigorous imprisonment. This is an appeal by special leave against that decision. One Nikka Singh had three sons, Bhagwan Singh, Lal Singh and Sunder Singh. Bhagwan Singh died issueless some years ago and disputes arose between Lal Singh and his brother Sundar Singh in regard to the division of the property of Bhagwan Singh. Sunder Singh was in possession of some of his landed 420 properties and Lal Singh obtained a number of decrees against him but Sunder Singh declined to restore possession of the properties to his brother Lal Singh. In view of this litigation the relations between Lal Singh and Sunder Singh were considerably strained and it is said that for some time they were not even on speaking terms. Lal Singh is married to Mst. Dhan Kaur and from her he had two sons. One of them Bagher Singh was murdered and the other, Arjan Singh, is P. W. 5. Accused Ajmer Singh is the son of Sunder Singh and Banta Singh is his real brother. Ajmer Singh is married to Jagir Kaur and Banta Singh to Kartar Kaur. It is alleged by the prosecution that on the evening of the 27th January, 1948, Jagir Kaur complained to her fatherin law that her husband had pawned her ear rings in order to pay off his gambling debts. On the morning of the 28th Banta Singh inquired from Ajmer Singh about this matter and he replied that he had pawned the ear rings to one Banta Singh Mazhbi. Soon after this Ajmer Singh, Banta Singh and one Teja Singh went to Banta Singh Mazhbi and asked him to return the ear rings but the latter replied that no ornaments had been pawned with him and added that he would give a sum of Rs. 30 to them if Ajmer Singh took an oath that the ornaments had in fact been left with him. It is said that Lal Singh was also present when this conversation took place and took up cudgels on behalf of Banta Singh Mazhbi and this led to an exchange of hot words between Lal Singh and the party of Sunder Singh 's two sons and their companion Teja Singh. The parties, however, dispersed after exchanging hot words but without coming to blows. At about sunset the same day Lal Singh and his brother Sunder Singh started abusing each other from their respective houses which open out into a common.courtyard. This wordy warfare between the two brothers attracted the attention of Arjan Singh, Bagher Singh and one Ujagar Singh Mazhbi who on bearing the noise came to the house of Lal Singh. 421 Lal Singh finding himself supported by three others threw out a challenge to Sunder Singh and told him to come out in the open. It is said that Sunder Singh, his two, sons Banta Singh and Ajmer Singh, and Teja Singh, a cousin of theirs, accepted the challenge and rushed out of the house. Teja Singh and Banta Singh were armed with spears and they made an attack on Lal Singh and Dhan Kaur and inflicted on their persons a number of injuries. Ajmer Singh, it is said, was armed with a spear and he plunged his weapon into the chest of Bagher Singh who collapsed and died almost instantaneously. Arjan Singh soon after reported this incident at the police station after travelling a distance of about seven miles at 11 45 p. m. He gave to the police substantially the same version as has now been deposed to by him in the witness box. In this report it was stated by Arjan Singh that it was Ajmer Singh who dealt Bagher Singh a barchha blow on his chest and that Bagher Singh fell down at this blow. The police arrested Sunder Singh, Teja Singh and Banta Singh but the appellant could not be found. Sunder Singh, Teja Singh and Banta Singh were prosecuted under section 302/34 but were convicted under section 324, Indian Penal Code, Banta Singh and Teja Singh were sentenced to two years ' rigorous imprisonment each and Sunder Singh to six months ' rigorous imprisonment. On appeal, Sunder Singh was acquitted and the sentences imposed on Banta Singh and Teja Singh were reduced. A lenient view ' of the affair seems to have been taken because the fight between these near collaterals took place suddenly and ended promptly. Bagher Singh died as a result of one blow and injuries on the person of Lal Singh and Dhan Kaur were not very serious Ajmer Singh was apprehended on 4th December, 1948, and as above stated, was tried by the learned Sessions Judge of Ferozepore and acquitted, but was convicted by the High Court on appeal by the State Government. 422 Lal Singh, P. W. 3, father of the deceased, Dhan Kuar, his mother, and Arjan Singh,his real brother, have given direct evidence about the occurrence. Ujagar Singh Mazhbi whose name is mentioned in the first information report was tendered for cross examination but no question was put to him about the actual fight, and the manner in which it took place or the part that was taken in it by the accused. One Bishandas, whose shop adjoins the shop of Banta Singh Mazhbi, was tendered for cross examination as P.W.7. He deposed that Banta Singh Mazhbi and Lal Singh were the only persons when the quarrel about ear rings took place near his shop. In reexamination he stated that Banta Singh, brother of the accused, and Teja Singh had come on one side and Lal Singh on the other when the quarrel about the ear rings took place. No direct question was put to the witness about the presence of, Ajmer Singh on that occasion. The learned Sessions Judge considered him a wholly independent witness and accepted his evidence about the incident that took place at Banta Singh Mazhbi 's shop on the morning of the 28th. He held that Ajmer Singh was not present at Banta Singh Mazhbi 's shop and that Lal Singh and Arjan Singh had falsely implicated him in the quarrel over the ear rings, and that if the witnesses could falsely involve him in regard to one part of the occurrence, the possibility of his being implicated for the murder of Bagher Singh merely as a matter of vindictiveness could not be outruled. After examining the evidence of the three eye witnesses in detail, the learned Sessions Judge reached the conclusion that they had suppressed the facts in order to absolve themselves of all liability for the happenings of the 28th, and had uttered untruths and that no confidence could be reposed in their statements about the part that they had assigned to Ajmer Singh. In the concluding part of the judgment he observed that " the parties were at logger heads on several issues and in the absence of independent evidence it is difficult to place reliance on the prosecution story 423 in regard to Ajmer Singh. " The High Court on appeal minutely reviewed the evidence of these three eye witnesses and considered that the variations in the statements of witnesses made at , the two trials and which had weighed on the mind of the Sessions Judge were of a minor and trifling character and were quite natural as the Statements at this trial had been made 27 months after the occurrence and that the narration of events by Arjan Singh was substantially the same as had been given by him at the earlier trial and in the first information report. As regards Lal Singh, who had resiled from his earlier statement and bad denied that he was armed with a phaura or that Arjan Singh wag armed with a lathi, it was said that this omission on his part was due to mere lapse of memory and forgetfulness rather than to a deliberate design to improve upon the prosecution story. It was argued by Mr. Pritam Singh Safeer that in this case there were no compelling reasons for setting aside the order of acquittal and that due proper weight had not been given by the High Court to the opinion of the trial judge as regards the credibility of witnesses seen and examined by him. The learned counsel submitted that the High Court was in error in the view that "when a strong prima facie case is made out against an accused person it is his duty to explain the circumstances appearing in evidence against him and` he cannot take shelter behind ' the presumption of innocence and cannot state that the law entitles him to keep his lips sealed. " We think this criticism is well founded. After an order of acquittal has been made the presumption of inno cence is further reinforced by that order, and that being so, the trial court 's decision can be reversed not on the ground that the accused had failed to explain the circumstances appearing against him but only for ,very substantial and compelling reasons. As the courts below expressed divergent opinions on the credibility of the prosecution witnesses, we 35 424 had to read the evidence adduced in the case with great care and after doing so, we are on the whole inclined to agree with the view expressed by the High Court. It is difficult to believe that without there being any truth in the fact that the appellant struck Bagher Singh with a barchha, Arjan Singh selected the appellant and ascribed to him that part soon after the occurrence. There are no material discrepancies in the statements made by Arjan Singh on different occasions and in our view the reasons given by the learned Sessions Judge for rejecting his testimony are not convincing. We agree with the High Court that there are no sufficient reasons for distrusting his evidence. The number of persons who took part in the quarrel was not more than seven or eight and the blows inflicted were few, and in these circumstances Arjan Singh could have made no mistake as to the identity of the person who struck Bagher Singh fatally. This part of his statement is corroborated by the evidence of Lal Singh and Dhan Kaur. No cross examination was directed, against this part of their statements. It seems that the learned Sessions Judge took too exaggerated a view of the minor discrepancies in these statements and read them with a rather hypercritical mind. Bishandas, whose statement considerably impressed him, was only tendered for cross examination and never made a full statement about the happenings of the 28th morning. The statement made by him is somewhat cryptic and from this it cannot be definitely concluded that Ajmer Singh was not present on the morning of the 28th at the shop of Banta Singh Mazhbi. The learned Sessions Judge was not right in rejecting the whole of the prosecution evidence as unreliable merely on the basis of this cryptic statement. Ujagar Singh, the other so called independent witness, was tendered for cross examination but the defence did not ask him a single question about the happenings of the 28th. The argument therefore that the prosecution withheld from court independent witnesses who had witnessed the occurrence is without any substance. The learned Sessions Judge 425 was apparently labouring under some misapprehension when he said that the prosecution had withheld from the court independent witnesses of the occurrence. Apart from Ujagar Singh Mazhbi, no one else appears to have been present when the attack was made on Bagher Singh, Lal Singh and Mst. Dhan Kaur by the party of the accused. All that appears in evidence is that after the fight was over a number of persons arrived on the scene but as they did not witness the attack on Bagher Singh they could give no evidence on this point and their non production as witnesses cannot have any consequence on the case. It is significant that the defence also led no evidence to prove that the fight took place in a manner different from the one described by the prosecution witnesses, or that Ajmer Singh was not present on the occasion. In an appeal under section 417 of the Code of Criminal Procedure the High Court had full power to review the evidence upon which the order of acquittal was founded and we are satisfied that it did not in any way exercise it wrongly The injuries on the person of Kartar Kaur and under Singh were not proved to have been inflicted at the time of the occurrence and were of no consequence. The prosecution was under no obligation to explain how they came about. It was next argued that the trial held by the Sessions Judge was vitiated as the examination of the appellant was not in accordance with the provisions of section 342, Criminal Procedure Code. There is considerable force in the point that the examination of the appellant by the Sessions Judge was detective. All that the Sessions Judge did was, that he read out the examination of the accused in the committal court to him and then recorded the following questions and answers: " Q: Did you make before the Committing Magistrate the statement that has just now been read out to you ? A: Yes. 426 Q:Now that you have heard the entire evidence against yourself and the charge has been explained to you, do you wish to say anything else ? A: I am innocent. Q: Do you wish to produce any evidence indefence ? A: No." In the committal court the 'questions put to the accused and his answers were these : " Q: Did you pawn the, ear ring of your wife with Banta Mazhbi and squander the proceeds on or about 28th January, 1948 ? A: No. Q : Did Lal Singh interfere when you were demanding the ear rings from said Banta Singh on 28th January, 1948, at Nathuwala and remark that the sweeper, i.e., Banta, was speaking truth when he denied the transaction ? A: No. Q: Did you on 28th January , 1948, at Nathuwala along with your father Sunder Singh, Banta Singh, and Teja Singh, you Banta Singh and Teja Singh being armed with spears, attack Lal Singh, his 'son Bagher Singh and Dhan Kaur at their house and in furtherance of the common intention of you all, Banta and Teja caused simple injuries to Lal Singh with spears and you caused fatal injuries with a spear to Bagher Singh deceased? A No. Q Why this case against you ? A Due to enmity. Q Anything else to say? A No." The Sessions Judge did not even take care to ask the accused the routine question whether the statement made by him in the committal court was correct. As if bard pressed for time, be simply asked him whether he had made that statement read out to him in the committal court, and was satisfied with an 427 answer, in the affirmative. The, second question asked, is of a general character and. ' does not satisfy the requirements of section 342, Criminal Procedure Code. We are of the opinion that when the Sessions Judge is required by that section to make the examination of the .accused, his duty is not discharged by merely reading over the questions and answers to the accused put in the committing magistrates court and by asking him whether he has to say anything about them. It is not, sufficient compliance with the section to generally ask the accused that having heard the prosecution evidence, what he has to say about it. The accused must be, questioned separately about each material circumstance which is intended to be used against him. It was pointed out by this Court in Tara Singh vs The State(1) that the whole object of the section, is to afford the accused a fair and proper opportunity of explaining circumstances which appear against him and that the questions must be fair and must be couched in a form which an ignorant or illiterate person will be able to appreciate and understand. In this particular case at one stage of the argument we were inclined to order a retrial of the accused in view of the defective examination of the accused by the Sessions Judge but on further thought we have reached the conclusion that the 'High Court was right in the view that the defective procedure followed by the Sessions Judge in this respect has not occasioned any prejudice to the accused. The facts of the case are free from any complication and the point in issue was a simple one and it cannot be said that the per functory examination of the appellant did any damage. The only point appearing in the evidence against the accused was that he gave a barchha blow to Bagher Singh. The witnesses had stated that fact in his face and had been cross examined on the point by his counsel. He was fully apprised of the part ascribed to him in the quarrel. His answer to this specific question in the committal court was that he was innocent and that he was being implicated owing to (1) ; 428 enmity. He stuck to that reply in the Court of Session after fully understanding what he was asked. It is well settled that every error or omission not in compliance with the provisions of section 342 does not necessarily vitiate a trial. Errors of this type fall within the category of curable irregularities, and, as held in Tara Singh 's case(1), the question, whether the trial is vitiated, in each case depends upon the degree of the error and upon whether prejudice has been or is likely to have been caused to the accused. We are of the opinion that the disregard of the provisions of section 342 in this case is not so gross as would justify our quashing the conviction and ordering a retrial. The result is that we uphold the judgment of the High Court and dismiss the appeal. Appeal dismissed.

After an order of acquittal has been made the presumption of innocence is further reinforced by that order, and that being so, the trial court 's decision cannot be reversed merely on the ground that the accused had failed to explain the circumstances appearing against him but only for very substantial and compelling reasons. In an appeal under section 487, Criminal Procedure Code, the High Court has full power to review the evidence upon which the order of acquittal was founded. The duty of a Sessions Judge under section 342, Criminal Pro cedure Code, to examine the accused is not discharged by merely reading over the questions put to the accused in the Magistrate 's Court and his answers, and by asking him whether he has to say anything about them. It is also not a sufficient compliance with the section to generally ask the accused t hat, 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 419 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. It is, however, well settled that every error or omission complying with section 342 does not necessarily vitiate the trial. Errors of this type fall within the category of curable irregularities and the question whether the trial has been vitiated depends in each case upon the degree of error and upon whether prejudice has been or is likely to have been caused to the accused. Tara Singh vs The State ([1951] S.C.,R. 729) referred to.

Civil Appeal No. 300 of 58. A. N. Sinha, N. H. Hingorani and P. K. Mukherjee, for the appellants. C. K. Daphtary, Solicitor General of India, R. Ganpathy Iyer and R. H. Dhebar, for respondent No. 1. C. K. Daphtary, Solicitor General of India and K. L. Hathi, for respondent No. 3. 1961 December 13. The Judgment of the Court was delivered by SARKAR, J. This appeal raises certain questions as to the validity of an order made under section 36 of the , sanctioning the transfer of its life insurance business by one insurance company to another. The appellants had challenged that order by a petition field under article 226 of the Constitution in the High Court of Punjab. The High Court having dismissed the petition they have come to this Court in appeal. There are three appellants, one of whom is a shareholder of the transferor company, another a policy holder in it and the third, one of its agents who claims to have become entitled under the to receive from it commission on renewal premiums paid on life insurance business 132 introduced by him. They complain that their respective rights have been adversely and illegally affected by the sanction. The transferor company is the India Equitable Insurance Company Ltd. and the transferee company, the Area Insurance Company Ltd. Under the transfer all the life insurance business including liabilities issued and all the life fund of the transferor company were taken over by the transferee company. It is said and perhaps that is the correct position that as a result of the transfer all the transferor company would vest in the transferee company and the transferor company would really become defunct. The first point argued by Mr. Sinha for the appellants is that the transfer offends sections 10 and 12 of the Companies Act. The Companies Act with which we are concerned, is the Companies Act of 1913 as it stood in 1954. Section 10 of the Companies Act provides that a company shall not alter the conditions contained in its memorandum except as provided in that Act. Section 12 states that a company may by special resolution alter the provisions of its memorandum with respect to its objects but that the alteration shall not take effect until it is confirmed by court on petition. The contention of the learned Advocate is that the arrangement of transfer really amounts to abandonment of the business of the transferor company and therefore to an alteration of its memorandum without following the procedure laid down in section 12 and this cannot be done. The obvious answer to this contention is that the transfer does not effect any alteration in the memorandum of the transferor company. Clause 3(27) of the memorandum of the transferor company gives it the power to sell its undertaking. The transfer in this case is an exercise of this power and hence within the objects of the company. An exercise by a company of a 133 power given by its memorandum cannot amount to an alteration of the memorandum at all. It is then said that clause only authorised a sale and that a sale is a transfer for a consideration. It is contended that in the present case there was no consideration moving from the transferee company and, therefore, the transfer was not by way of a sale. This, it is contended, was, therefore, a transfer without any power in that regard in the memorandum and hence in substance amounts to unauthorised alteration of it. We were referred to various balance sheets and other figures in support of this contention. This point as to want of consideration was not taken in the petition and the High Court did not permit it to be raised. We have, therefore, to proceed on the basis that the transfer was a sale. We wish however to make it clear that we are not deciding what is enough consideration for a sale, nor whether a transfer not authorised by the memorandum would amount to an alteration of the memorandum. What we have said furnishes enough answer to the contention raised. Mr. Sinha then contends that the result of the transfer was a virtual winding up and that it was not one of the corporate objects of a company to wind it up. The contention was that the winding up could be effected only under the provisions of the Companies Act. We were referred to Bisgood vs Henderson 's Transvaal Estates Ltd(1) as authority for this proposition. We think, this contention is misconceived. What was done in this case was done under the provisions of the and not by way of carrying out a corporate object of the transferor company. Now, section 117 of the provides that nothing in that Act would affect the liability of an insurance company to comply with the provisions of the Indian Companies Act, in matters not otherwise specifically provided for by it. Section 36, of the , which has for the present purpose to be read with section 35 of that 134 Act, makes certain specific provisions which, as we shall presently show, override the provisions of the Companies Act. The objection based on Bisgood 's case(1) is ill founded. There a company was sought virtually to be wound up and its assets distributed in purported exercise of a power to sell the undertaking and other cognate powers contained in its memorandum of association, and this the Court said could not be done as it would make the provisions for winding up in the Companies Act ineffective. In the present case the thing has been done under express statutory power. No question here arises of a corporate power in the sense it arose in Bisgood 's case (1). Further there is not here, as there was in Bisgood 's case (1), a distribution of the assets of the transferor company after its undertaking had been transferred. Hence we have here no winding up really. The next contention of Mr. Sinha is that the arrangement for the transfer had been made by the directors and the directors had no power in view of section 86H of the Companies Act, to transfer the undertaking of the company. That section gave the directors power to transfer the undertaking with the consent of the company in a general meeting. In the present case, what had happened was that an agreement between the two companies for the purpose of the transfer had been made by the directors and it was subsequently approved by the shareholders of the transferor company at a general meeting by about 82 per cent, majority. It was after such approval that the transfer had been sanctioned under section 36 of the , and may be, though we do not have this on the record, the transfer was effected by proper documents executed between the companies. An agreement only to transfer the undertaking by the directors clearly does not violate section 86H for it is merely 135 tentative subject to final approval by the Company in general meeting. This we think is by itself sufficient answer to Mr. Sinha 's present contention. Mr. Sinha however says that the approval by the Company at its general meeting was of no use because the defect in the original agreement, namely, that the directors had no power to transfer in view of section 86H, was not pointed out at that meeting to the shareholders. It is somewhat difficult to appreciate this point. There was no defect in the directors ' making the agreement to transfer; such agreement did not effect the transfer. Even assuming that the agreement was beyond the power of the directors, it cannot be said that the approval of it by the shareholders had been without any knowledge of the defect. The defect was of the want of the directors ' power to transfer in view of the provisions of section 86H of which the shareholders cannot be heard to deny knowledge. The case of Permila Devi vs Peoples Bank of Northern India Ltd.(1) on which Mr. Sinha relied for the present purpose is of no assistance to him. There certain shares had been illegally forfeited but it was contended that the shareholders had ratified the forfeiture. It was held that the ratification, if any, was of no use because it had not been shown that the attention of the shareholders and creditors had been drawn to the illegality which depended on facts of which no knowledge by the shareholders could be presumed. In the present case, the defect, if any, arose from a statutory provision itself of which the shareholders must be deemed to have had knowledge. Mr. Sinha then says that the transfer was bad as it involved a reduction of share capital of the transferor company. His point is that as all the assets were gone there was necessarily a reduction of its share capital. He says that a reduction of share capital can be effected only as provided in section 55 and the succeeding sections of the Companies Act. This contention is, in our view, wholly 136 misconceived. Reduction of share capital under these sections, is not brought about by loss of assets. A bare perusal of the sections, we think, is enough to establish that. The disappearance of the assets of the Company, for whatever reason, does not cause a reduction of the share capital. Another point raised by Mr. Sinha is that the transfer was bad it offended section 44 of the . Under that section certain insurance agents have been given certain rights against their employer companies to receive commission in respect of renewal premiums paid. We will assume for the present purpose that the petitioner who is an agent, had acquire such a right against the transferor company under section 44. We do not however see that such rights are in any way affected by the transfer. The right of the petitioner agent against the Company remains. It may be that he cannot realise the amount due, by enforcing that right because the transferor company has no assets left after the transfer out of which to pay the commission. But section 44 does not say that an insurance company shall not be entitled lawfully to deal with its assets where the effect of such dealing might be that nothing is left out of which the agents can be paid their commission. Further, more it has to be remembered that what has been done in this case has been done under the same Act. Section 36 of the does not say that a transfer shall not be sanctioned if the effect of it is to leave no assets with the transferor company. Reading the two sections together, as we must do, it is not possible to take the view that transfer cannot be sanctioned under section 36 if the result of that is to denude the transfer or company of all its assets out of which an agent can be paid his commission. A further point is based on article 14 of the Constitution. It is said that there were other insurance companies in the same insolvent position 137 as the transferor company and that the policy holders of the latter company alone were being made to suffer. It may be stated here that the transfer involved a condition affecting slightly adversely the rights of the policy holders. It does not seem to us however that any question of discrimination arises in the present case. The transfer was sanctioned with the assent of the shareholders of the two companies concerned. The sanction was given after the policy holders of the transferor company were heard. Again, section 36 of the applies to the insurance companies where the companies in general meeting agree to a transfer. No action under section 36 can be taken except on the initiative of the companies concerned. It is done in the best interests of the policy holders. Then it is argued that the terms of sections 35 and 36 had not been complied with. It is necessary now to be set out the relevant portions of the sections and some of the facts of this case. section 35. (1) No life insurance business of an insurer specified in sub clause (a)(ii) or sub clause (b) of clause (9) of section 2 shall be transferred to any person or transferred to or amalgamated with the life insurance business of any other insurer except in accordance with a scheme prepared under this section and sanctioned by the Controller. (2) Any scheme prepared under this section shall set out the agreement under which the transfer or amalgamation is proposed to be effected, and shall contain such further provisions may be necessary for giving effect to the scheme. (3) Before an application is made to the Controller to sanction any such scheme, notice of the intention to make the application together with a statement of the nature of 138 the amalgamation or transfer, as the case may be, and of the reason therefor shall, at least two months before the application is made, be sent to the Controller and certified copies, four in number, of each of the following documents shall be furnished to the Controller, and other such copies shall during the two months aforesaid be kept open for the inspection of the members and policy holders at the principal and branch offices and chief agencies of the insurers concerned, namely. [Here certain documents are specified. ] section 36. (1) When any application such as is referred to in sub section (3) of section 35 is made to the Controller, the controller shall if for special reasons he so directs, notice cause, of the application to be sent to every person resident in India who is the holder of a policy of any insurer concerned and shall cause statement of the nature and terms of the amalgamation or transfer, as the case may be, to be published in such manner and for such period as he may direct and after, hearing the directors and such policy holders as apply to be heard any other persons whom he considers entitled to be heard, may sanction the arrangement, if he is satisfied that no sufficient objection to the arrangement has been established and shall make such consequential orders as are necessary to give effect to the arrangement, including orders as to the disposal of any deposit made under section 7 or section 98: It would appear from the terms of section 35 (3) that it contemplates the following steps: (a) A notice of the intention to make an application to the Controller of Insurance for sanction of the transfer has to be given to him. 139 (b) Thereafter, together with the notice, certain specified documents have to be kept open for the inspection of the shareholders for two months. (c) After the expiry of the period of two months, an application has to be made to the controller of insurance for sanction of the transfer. Now, what had happened in this case was that the notice contemplated by section 35 (3) was given on July 27, 1951, and the necessary documents were kept open for inspection. Before the application to the Controller was made, the directors of the companies were in touch with the Controller in regard to the proposed transfer and the latter suggested various modifications in the proposed scheme which was one of the documents which had to be kept open for the inspection of the shareholders. On October 30, 1951, an application to sanction the transfer was made under section 35 (3) of Subsequently, also further modifications were suggested by the Controller. On July 28, 1952, the transferor company in its general meeting considered the suggestions of the Controller and approved of the scheme with certain modifications, to the details of which it is not necessary to refer. The scheme so modified contained the following clause: CL. 16. That this arrangement is conditional upon the sanction on a subsequent date either with or without any modification of the terms hereof imposed or approved by the Controller and accepted by the parties here to and subject as aforesaid, the provisions as mentioned herein shall be operative on and from the thirty first of December 1950. It was this scheme which was approved by the Company in its general meeting by the following resolution: "Read, considered and thoroughly discussed the proposed scheme of transfer. and resolved 140 that the proposed transfer. having been found to be arranged by the directors of the Company in the best interests of the Policy holders, the same be and are hereby approved and confirmed, and resolved further that the directors be and are hereby authorised to make and accept further modifications and alterations in the scheme if any suggested by the Controller of Insurance. " It appears that certain further modifications in the scheme were thereafter made. The Controller directed notice to be issued to all policy holders giving them full information of the scheme and fixed a date for hearing. All policy holders desiring to be heard, were heard. Before however the Controller passed his order sanctioning the scheme, the petition, out of which this appeal arises was filed on February 13, 1954. Apparently, on this date further hearing of the matter by the Controller was pending. On March 8, 1954, the controller gave his sanction to the scheme as modified. Thereafter, the petitioners on May 14, 1954, filed a supplementary petition asking for writ quashing the order, the first petition having only for asked a writ to quash the proceeding then pending before the Controller. Mr. Sinha points out and in this he is right that after notice under section 35 (3) had been issued, the scheme of transfer had been modified and it was such modified scheme that was sanctioned by the Controller. Mr. Sinha 's point is that under section 36 the Controller could only sanction the scheme of which notice had been given under section 35. He, therefore, contends that the sanction granted by the Controller in this case was not in terms of the section and hence a nullity. The learned Solicitor General appearing to oppose the appeal contends that on a proper construction of the sections the Controller had power to sanction a scheme modified after notice under section 35 (3) had been issued. It is however unnecessary in this case to decide the question so raised. 141 We will resume for the present purpose that under section 36 (1) only the scheme of transfer in respect of which notice under section 35 (3) had been given could be sanctioned and not a modified version of it. The scheme and the resolution of the shareholders of the transferor company approving it, however both provided for its modification later at the suggestion of the Controller and gave power to the directors to accept the modifications on behalf of the Company. The modifications were pursuant to the terms of the scheme as approved by the share holders of the transferor Company. Therefore, in substance, it was the scheme of which notice had been given under section 35 (3) which was sanctioned. A similar view was taken in England in regard to sections 153 and 154 of the English Companies Act, 1929. Those sections dealt with compromises with creditors and for reconstruction and amalgamation of companies. These could be effected by an order of court after the relative scheme had been approved by the companies or creditors concerned. It was generally felt that the court could either sanction the scheme approved by the shareholders or reject it but had no power to modify it. The contention of Mr. Sinha in the present case it will be remembered, is substantially the same. To remove the doubt as to the power to modify the scheme after it had been approved by the share holders of the companies concerned, the author of Palmer 's Company Precedents appears to have recommended the device of inserting in the scheme a clause giving power to the court to modify the scheme and the directors to accept the modification. In the 16th Edition of this well known book the following passage appears at p. 844, "It is more than doubtful whether, if a particular scheme is agreed to at a general meeting of creditors, the court can sanction 142 that scheme with modifications, unless there is some provision in the scheme providing for possible modifications. In cases whether has no such provision, and some modification has been thought expedient, the court has required the calling of a second meeting to consider the scheme as modified; but to avoid this inconvenience it has for some time past been usual to insert in schemes a clause (originated by the author) expressly empowering the liquidator to assent to any modifications or conditions approved or imposed by the court, and this provision was approved by Chitty J. in Dominion of Canada, etc. Co., and has frequently been acted on. This practice seems to have obtained approval in our country to : see Mihirendrakishore Datta vs Brahmanbaria Loan Company Ltd., (1) turning on section 153 of the Companies Act, 1913, which corresponded to the sections of the English Act earlier mentioned. Mr. Sinha contends that the authorities on the Companies Act earlier referred to had no application to the present case. He says that the sections of the Companies Acts on which these authorities turned were not pari materia with sections 35 and 36 of the . His contention is that the object of these sections of the was to protect the shareholders and policy holders of the Company and that they would be deprived of that protection if a scheme modified subsequently to the issue of the notice under section 35 (3) could be sanctioned. We do not think that this contention is well founded. So far as the policy holders are concerned, they have nothing to do with the approval of the scheme. The scheme of transfer was agreed to between the shareholders of the companies concerned in the deal. Assume, as Mr. Sinha says, that under the , as it is under the 143 the Companies Act, it is the shareholders who must agree to the scheme. In the cases falling under the Companies Act, it is for protecting the shareholders that it has been held that the court cannot modify the scheme unless the scheme itself gives the court the power to do so. On the assumption made we think it perfectly clear that the position under the is the same. If Mr. Sinha is wrong and under the it is not for the shareholders to sanction the scheme, then there would be less reason for saying that what could be done under the Companies Act, cannot be done under the . The intention of sections 35 and 36 of the would on the basis of Mr. Sinha 's contention, be to protect the shareholders from having to accept a scheme to which they have not agreed. Such protection however may be given up by shareholders by inserting in the scheme approved by them, a clause empowering the directors to modify it. So far as the policy holders are concerned, their protection is left in the hands of the controller. That is the policy of the and, hence, the Controller hears them. In the present case, he actually heard policy holders. Therefore it does not seem to us that it can be contended with substance that sections 35 and 36 of the are not pari materia with the sections of the Companies Act to which we have earlier referred. The last point of Mr. Sinha must also fail. The result is that this appeal must be dismissed with costs and we order accordingly. There will be one set of hearing costs.

In an application under article 226 of the Constitution, to challenge the validity of the transfer of a life insurance company 's business to another company under section 36 of the : ^ Held, the transfer though it brought about an abandonment of the business of the company was not bad as resulting in an alteration of the memorandum of the company without recourse to section 12 of the Indian Companies Act, 1913. The Company 's memorandum of association contained a power to sell its undertaking and an exercise of that power does not amount to alteration of the memorandum. The transfer was not a winding up of the company without following the procedure laid down in the Companies Act and hence invalid. It was effected under the provisions of the . Bisgood vs Hendersons Transval Estate, , distinguished. An agreement by the directors of a company to transfer its undertaking subject to confirmation by the company in general meeting did not offend section 86H of the Companies Act. Section 55 and the connected sections of the Companies Act do not contemplate reduction of share capital brought about by loss of assets and loss of assets does not amount to reduction of share capital. Section 44 of the does not prevent an insurance company from dealing with its assets though as a result thereof no asset was left out of which the agents of the company might be paid commission to which they are entitled under the . 131 Section 36 of the does not offend article 14 of the Constitution. That section applies to all insurance companies which in general meeting agree to a transfer. Even if it is assumed that under section 36 (1) of the only that scheme of transfer of which notice under section 35 (3) of the Act had been given could be sanctioned and not a modified version of it, there would be power to sanction a modified version where the scheme itself or the resolution of the company approving of it, gave power to the directors to accept modifications of that scheme on behalf of the company suggested by the controller of Insurance before final sanction by him. Mihirendrakishore Datta vs Brahmanbaria Loan Co., Cal. 913, referred to.

Civil Appeal No. 398 of 1960. Appeal by special leave from the judgment and decree dated June 23, 1959, of the Calcutta High Court in Appeal from Original Decree No. 50 of 1955. Veda Vyasa, section K. Kapur and B.P. Maheshwari, for the appellant. K. L. Gosain and K. L. Mehta, for the respondent. December 20. The Judgment of the Court was delivered by 219 SHAH, J. Mr. Justice Bachawat of the High Court of Judicature at Calcutta decreed Suit No. 1039 of 1948 filed by one Pearey Lal hereinafter called the plaintiff for a decree for Rs. 1,35,000/ with interest against the New Bank of India Ltd. The appeal of the Bank against the decree was dismissed by a Division Bench of the High Court. With special leave the Bank has appealed to this Court. The Bank had its registered office, originally at Lahore but after the partition of India the office was transferred to Amritsar. The plaintiff who was a resident of Lahore had accounts with several banks including the New Bank of India Ltd. In view of the impending partition, the plaintiff was anxious to transfer his moveable property outside the territory it was apprehended would be included in Pakistan, and he gave instructions for transferring his accounts with the Bank to its other branches in India. He also paid an amount of Rs. 1,25,000/ on July 18, 1947, into the Bank at Lahore with instructions to transmit the same the to Bank branch at Calcutta which it then proposed to open in the near future. An amount of Rs. 10,000/ was also paid into the Bank at Lahore on July 19, 1947, with similar instructions. In respect of these two transactions the Bank executed receipts which are set out below: "Received the sum of Rs. 1,25,000/ (Rs. One Lac & twenty five thousand) only from Mr. Pearey Lal on account of amount to be remitted to Calcutta branch for preparing various F.D. Receipts subject to his instructions on or after the opening date when he would call upon them personally. Lahore for the New Bank of India Ltd. The 18th day of Sd. Illegible July, 1947. Manager. " 220 . . . . . . . . . . . . . . . . . "Received the sum of Rs. 10,000/ (Rupees ten thousand) only through Mr. Pearey Lal for transmission to our Calcutta Office for making up various F. D. Receipts at his instance when he calls upon them personally on or after the opening date of the Branch. Lahore for the New Bank of India Ltd. 19 7 47. Illegible Manager. " The two amounts were transmitted by the Bank to Calcutta. A branch of the Bank was opened at Calcutta on September 24, 1947, but within a few days thereafter the Bank ceased making payments. It appears that a moratorium for a limited period was declared under an Ordinance issued by the Governer General restraining the Bank from making payments to its depositors. In December, 1947, after the expiry of the period of the moratorium the plaintiff applied to the Bank 's branch at Calcutta for facility to withdraw the whole amount but the Calcutta Branch raised certain technical objections against such a course. On March 24, 1948 the plaintiff commenced an action against the Bank inter alia for a decree of Rs. 1,35,000/ in the Calcutta High Court on its original side. During the pendency of the suit the High Court of East Punjab sanctioned a scheme for arrangement under sections 153 and 153A of the Indian Companies Act, 1913, for settlement of the liability of the Bank. By the first clause of the scheme the expression "deposit" was to include "Fixed Deposits, Bank 's own Cash Certificates, Current Accounts, Deposits at Call, Savings Fund Accounts Amounts lying in Sundries or in any other kind of Credit Accounts, Bank Drafts, Cash Orders, and documents of the like nature and amounts due to Bankers over and above the value of Government Securities lying with them against 221 such depositors". It was directed by the scheme, as it finally emerged, that the depositors were to be paid 701/2% of the deposits held by them and to he allotted shares of the face value of 5% of the deposits. The plaintiff claimed by his suit that he had entrusted to the Bank at its registered office at Lahore Rs. 1,35,000/ on July 18 and 19, 1947, with instructions to transmit the same to the branch of the Bank which it proposed to open at Calcutta and to hold the amount subject to further instructions to be given by him when he would call personally at the branch at Calcutta on or after the opening date, that prior to the opening of the said Calcutta Branch the plaintiff countermanded his instructions on or about September 13, 1947 and demanded at Lahore that it be returned, but the Bank wrongfully claimed to have remitted the two sums to its Calcutta Branch and to have kept the same in a fixed deposit account in the name of the plaintiff, even though the plaintiff, had opened no such account at the Calcutta Branch and had given no instructions to put the same into any account by way of fixed deposit or otherwise. The plaintiff, accordingly, claimed that the Bank was a trustee for transmission of the amount and in the absence of any instructions given by him for opening a fixed deposit account, in respect of the amount transmitted the Bank stood qua the plaintiff in a fiduciary relation and was liable to refund the full amount. In substance, it was claimed by the plaintiff that the amount lying with the Bank at Calcutta was not a deposit within the meaning of the scheme and was not liable to any reduction. The Bank submitted that the amount of Rs. 1,35,000/ was deposited by the plaintiff at its head office at Lahore for the purpose of opening a fixed deposit account in the name of the plaintiff upon the terms that the fixed deposit would carry 222 interest as on the respective dates of the deposits, that it was agreed that the plaintiff would be allowed to take loans upto 90% of the deposit at a rate of interest of half percent above the current fixed deposit rates and that the amount would be transmitted to the Calcutta Branch of the Bank for the purpose of crediting the same to the fixed deposit account of the plaintiff. The Bank denied the alleged instructions in September, 1947, countermanding the original arrangement and contended that the plaintiff was bound by the scheme of arrangement sanctioned by the High Court of East Punjab. The Bank offered to pay the amount due to the plaintiff under the scheme of arrangement and also to allot shares of the value of 5% in accordance with the scheme. A decree on admission was passed against the Bank for Rs. 81,000/ and the suit was contested by the Bank for the balance of the claim. The trial Court held that even though the plaintiff failed to prove the instructions in the month of September, 1947, set up by him countermanding transmission, it was established on the evidence, that the plaintiff had entrusted to the Bank Rs. 1,35,000/ for transmission and the plaintiff having given no further instructions, the Bank held the amount as trustee for the plaintiff and that the plaintiff 's claim was not liable to be reduced under the scheme sanctioned by the High Court of East Punjab. The Court also negatived the plea of the Bank that the amount of Rs. 1,35,000/ was deposited with the Bank at Lahore for opening a fixed deposit account subject to the conditions which the Bank set up. The finding of the trial Court were confirmed, in appeal, by a Division Bench of the High Court at Calcutta. The facts found proved, according to the findings of the trial Court and confirmed by the 223 High Court are therefore that the plaintiff delivered an amount of Rs. 1,25,000/ on July 19, 1947, and Rs. 10,000/ on July 19, 1947, to the Bank at Lahore for transmission to Calcutta, with instructions to await the directions of the plaintiff regarding the opening of accounts for keeping the same in fixed deposit or otherwise in the Calcutta Branch of the Bank, and the plaintiff never gave instructions for opening any account, fixed deposit or otherwise, in regard to the amounts after they reached Calcutta. Delivery of the amount for transmission to the Bank created ex facie a relationship of a fiduciary character. But counsel for the Bank contends that when the amount was handed over at Lahore to the Bank by the plaintiff who was an old constituent of the Bank it must be presumed that a relationship of debtor and creditor arose and by the addition of instructions for transmissions of the amount to another branch the relationship of trustee and cestuique trust did not arise. He submitted that the contention that the relation between the plaintiff and the Bank was of creditor and debtor was supported by three important circumstances: (1) that the Bank agreed to pay interest on the amount delivered by the plaintiff; (2) that the Bank charged no commission or remuneration for transmission of the amount and (3) that even on the plaintiff 's case the amount was to be utilized for opening fixed deposit accounts at Calcutta. It is true that in the absence of other evidence a person paying money into a Bank, whether he is a constituent of the Bank or not, may be presumed to have paid the money to be held as bankers ordinarily hold the moneys of their constituents. If no specific instructions are given at the time of payment or thereafter, and even if the money is held in a suspense account the bank does not thereby become a trustee for the amount paid. In other words, when a person dealing with 224 a bank delivers money to the Bank an intention to create a relation of creditor and debtor between him and the Bank is presumed, it being the normal course of the business of the Bank to accept deposits from its customers. But this presumption is one of fact arising from the nature of the business carried on by the Bank and is rebutted by proof of special instructions, or circumstances attending the transaction. Where the money is paid to a bank with special instructions to retain the same pending further instructions (The Official Assignee, Madras vs Natesam Pillai (1)) or to pay over the same to another person who has no banking account with the bank and the bank accepts the instructions and holds the money pending instructions from that other person (Arbuthnot & Co. vs D. Rajam Ayyar (2)), or where instructions are given by a customer to his banker that a part of the amount lying in his account be forwarded to another bank to meet a bill to become due and payable by him and the amount is sent by the banker as directed (Farley vs Turner (3)), a trust results and the presumption which ordinarily arises by reason of payment of the money to the bank is rebutted. It is not necessary in this appeal to consider whether because of an agreement to pay interest the relationship may be deemed to be of debtor and creditor, because it was held by both the courts below that no such agreement is proved, and according to the settled practice of this court the finding is regarded a binding. The Bank charged no commission or remuneration for transmitting the amount to Calcutta, but that, in our judgment, is a circumstance which permits of no inference against the plaintiff. Undoubtedly, when the amount was delivered to the Bank by the plaintiff it was his intention to open fixed deposit account in Calcutta with the 225 Bank 's branch but the fixed deposit accounts were to be opened after instructions were received. The transaction, as evidenced by the two receipts, was primarily one of entrustment of the amount to the Bank for transmission to Calcutta. After the purpose for which the moneys were entrusted was carried out, in the absence of further instructions the defendant did not cease to be a trustee. So long as instructions were not given by the plaintiff for appropriation of the amounts the Bank continued to hold the amounts transmitted for and on behalf of the plaintiff and there is no evidence that the plaintiff gave instructions or acquiesced in the opening of a fixed deposit account after the same reached Calcutta. It is immaterial that the Bank purported to open fixed deposit account in the name of the plaintiff with the amounts received at its head office at Lahore. That course of action was adopted without the consent of the plaintiff and it could not bind the plaintiff. The High Court was, therefore, right in holding that the amount delivered by the plaintiff to the Bank at Lahore remained in trust even after it reached Calcutta, and it was not held by the Bank, in deposit for the plaintiff within the meaning of the scheme sanctioned by the High Court of East Punjab. In that view of the case the appeal fails and is dismissed with costs. Appeal dismissed.

The respondent delivered certain sums of money to the appellant bank at Lahore for transmission to Calcutta, with instructions to await his directions regarding the opening of accounts for keeping the money in fixed deposit in the Calcutta Branch of the bank which was proposed to be opened in the near future. The respondent did not however give any instruction for opening any account, fixed deposit or otherwise in regard to the amounts after they reached Calcutta. Within a few days after the opening of the Calcutta branch of the bank it ceased making payments and a moratorium for a limited period was declared under an ordinance issued by the Governor General restraining the bank from making payments to its depositors. After the expiry of the period of the moratorium the Calcutta branch of the bank raised objections to the respondent 's application for withdrawal of the amount 218 whereupon the respondent filed a suit in the Calcutta High Court for a decree for refund of the amount. During the pendency of the suit the High Court of East Punjab sanctioned a scheme under sections 153 and 153A of the Indian Companies Act, 1913 for settlement of the liabilities of the Bank. The courts below decreed the respondent 's suit. On appeal by the bank by special leave, the questions which arose for decision were whether the bank was a trustee for transmission of the amounts to Calcutta and whether in the absence of any instruction for opening a fixed deposit account the bank was liable to refund the full amount or a reduced amount according to the scheme sanctioned by the Punjab High Court. ^ Held, that when a person dealing with a bank delivers money to the bank an intention to create a relation of creditor and debtor between him and the bank is presumed, but the presumption may be rebutted by proof of special instructions. When money is paid to a bank with special instructions to retain the same pending further instructions, a trust is created and the presumption which ordinarily arises by reason of payment of money to the bank is rebutted. Held, further, that the money delivered by the Respondent remained in trust with the bank and was not held by it as a deposit subject to any scheme for the settlement of the liabilities of the bank sanctioned by the High Court under the Companies Act. The Official Assignee, Madras vs Natesam Pillai, I.L.R. , Arbuthnot vs D. Rajan Ayyar, I.L.R. and Farley vs Turner, , applied.

Civil Appeal No. 62 of 1961. 212 Appeal by special leave from the judgment and order dated December 20, 1956, of the Madras High Court in Case Referred No. 85 of 1953. A. V. Viswanatha Sastri, R. Ganapathy Iyer and G. Gopalakrishnan for the appellant. K. N. Rajagopala Sastri and P.D. Menon for the respondent. December 20. The Judgment of the Court was delivered by KAPUR, J. This appeal by special leave is directed against the judgment and order of the High Court of Judicature at Madras. The appellant is the assessee and the respondent is the Commissioner of Income tax and the question raised is as to applicability of section 10(2)(xv) of the Indian Income tax Act to a gratuity paid by the appellant to one of its officers on his retirement from service. The appeal relates to the assessment year 1950 51. M/s. Gordon Woodroffee & Co. (Madras) Ltd., was incorporated as a private limited company in 1922 and became the Managing Agent of a public limited company M/s. Gordon Woodroffee Leather Manufacturing Company Ltd., which is the assessee. One J. H. Philips was employee in the Managing Agent Company from 1922 to 1935 and from 1935 he became an employee of the appellant company and became its Director from 1940. On March 22, 1949, he wrote a letter to the appellant company expressing his intention to resign from the Board of the Company as from April 4, 1949 upon his retirement from the employment of the company and requested that his resignation be accepted. On March 24, 1949, the Board of Directors of the appellant Company passed a resolution that his resignation be accepted and in appreciation of his long and valuable services to Company hebe paid a gratuity of Rs. 50,000/ out 213 of which the appellant Company was to pay Rs. 40,000/ and the Managing Agent Company the balance of Rs. 10,000/ April 4, 1949, this resolution of the Board of Directors was confirmed. On the same date a resolution to the same effect was passed at an Extraordinary General Meeting of the Company and before the end of its accounting year i. e. October 31, 1949, this amount of Rs. 40,000/ was paid to Mr. J. H. Philips. This amount was claimed as a deduction under section 10 (2)(xv) of the Income tax Act which reads : Section 10(2) "Such profits or gains shall be computed after making the following allowances, namely: . . . . . . . . . . . . . . . . . (xv) any expenditure (not being an allowance of the nature described in any of the claused (i) to (xiv) inclusive, and not being in the nature of capital expenditure or personal expenses of the assesee) laid out or expended wholly and exclusively for the purpose of such business, profession or vocation. " The amount was disallowed by the Income tax Officer as well as by the Appellate Assistant Commissioner on the ground that the appellant Company had no pension scheme; the payment was voluntary and that the entry in the assessee 's books clearly indicated it to be a capital payment. Against this order the appellant Company took an appeal to the Income tax Appellate Tribunal which upheld the order of the Appellate Assistant Commissioner. It held that according to the resolution the gratuity was paid "for long and valuable services to the Company"; that there was nothing to indicate that Mr. J. H. Philips had accepted a lower salary in expectation of getting a gratuity at the end of his service; that there 214 was no such practice in the appellant Company and that during the course of his service he was being remunerated at a graduated scale of salary and a commission of 2 1/2% on the profits; that there was no "expectancy" that at the end of the service there would be a recompense for faithful and efficient service that he had been suitably rewarded by being given a commission on the profits in order to whip up his enthusiasm". It was also mentioned that in the books of the appellant Company the amount had not been debited in the profit and loss account but was debited to the appropriation account thereby indicating that it was an extra payment or a payment made in the nature of a capital expense. Taking all these circumstances into consideration the Tribunal came to the conclusion that it was difficult to hold that the expenditure was not in the nature of a capital expenditure or that it was expended wholly and exclusively for the purpose of the assessee 's business. At the instance of the appellant Company the case was stated to the High Court under section 66(1) of the Income tax Act and the following question was referred : "Whether the sum of Rs. 40,000/ paid to Mr. J. H. Philips on his retirement from the service of the Company was not an admissible deduction under Section 10(2)(xv) of the Income tax Act, 1922. " The High Court answered the question against the appellant Company. It held that in order that section 10(2) (xv) be applicable it had to be proved that the amount was laid out or expended wholly and exclusively for purposes of the company 's business. In this case the amount was paid on retirement and for valuable services rendered by Mr. J. H. Philips; there was no evidence that he expected to receive this amount or the Company contemplated its payment at any time before; the payment 215 was voluntary and there was no evidence to show that it was in the future interest of the business of the Company that the expenditure was incurred. The High Court observed: "In the case of a payment of a gratuity to a retiring employee recognition of his past services, with nothing more cannot, in our opinion satisfy the requirements of Section 10(2)(xv), even if those requirements are judged from the view point of commercial expediency, as it always should be when a claim arises under Section 10(2)(xv). Was the expenditure incurred in the future interest of the business of the assessee? Was there any connection between the purpose of the payment and the further conduct of the business of the assessee ? These are the tests to be satisfied before it could be said that in paying the gratuity money was laid out or expended wholly and exclusively for the purpose of the business of the Company. These tests the assessee did not satisfy in this case. " Against this judgment and order the appellant Company has brought this appeal by special leave. It was argued on behalf of the appellant that the amount had been paid as a matter of commercial expediency and in the interest of the Company as an inducement to other employees that if they rendered service in a similar manner with efficiency and honesty they would be similarly rewarded. Decisive test, it was submitted, was whether such payments of gratuity were likely in future also and was the payment made as an incentive to the employees to give their best to the employer and if it was so then the payment was a matter of commercial prudence, It was also submitted that the Company had acted not with any oblique motive and 216 its good faith was not in doubt and in support of the contention several cases were relied upon. In our opinion on the findings as given the payment in dispute does not fall within the provisions of section 10(2)(xv). The amount was paid not in pursuance of any scheme of payment of gratuities nor was it an amount which the recipient expected to be paid for long and faithful service but it was voluntary payment not with the object of facilitating the carrying on of the business of the appellant Company or as a matter of commercial expediency but in recognition of long and faithful service of Mr. J. H. Philips. There was no practice in the appellant company to pay such amounts and it did not affect the quantum of salary of the recipient. The two cases strongly relied upon by the appellant Company were J. P. Hancok vs General Reversionary & Investment Company Ltd.(1) and J. W. Smith vs The Incorporated Council of Law Reporting for England and Wales(2). In the former case the assessee Company sought to charge as a trade expense a lump sum which it had paid for the purchase for the benefit of a former actuary, of an annuity equal in amount to the pension which the Company had resolved to pay him. This was held to be an expense admissible in computing the Company 's profits assessable to income tax. But in that case it was the practice of the assessee company to grant pensions to its servants after a considerable period of service and this practice was known to the employees and affected the rate of salary paid by the Company in that the employees were willing to serve the Company at lower rates than they otherwise would have by reason of the expectation of the pension at the end of their service, In the latter case there was a practice of granting gratuities and that was the ground for holding the amount to be a proper deduction. 217 In our opinion the proper test to apply in this case is, was the payment made as a matter of practice which affected the quantum of salary or was there an expectation by the employee of getting a gratuity or was the sum of money expended on the ground of commercial expediency and in order indirectly to facilitate the carrying on of the business. But this has not been shown and therefore the amount claimed is not a deductible item under section 10(2)(xv) The appeal therefore fails and is dismissed with costs. Appeal dismissed.

The company accepted the resignation of one of its directors and in appreciation of his long valuable services to the company, paid him a gratuity of Rs. 40,000/ . This amount was claimed as a deduction under section 10(2) (xv) of the Income tax Act which was disallowed by the Income tax Officer, on the ground that the appellant company had no pension scheme; the payment was voluntary and that the entry in the assessee 's books clearly indicated it to be a capital payment. ^ Held, that the payment does not fall within the provisions of section 10(2)(xv) of the Act. The amount was paid not in pursuance of any scheme of payment of gratuities nor was it an amount which the recipient expected to be paid for long and faithful service but it was for a voluntary payment not with the object of facilitating carrying on the business of the appellant company or as a matter of commercial expediency but in recognition of long and faithful service. There Was no practice in the appellant company to pay such amounts to and did not affect the quantum of salary of the recipient. To claim a deduction under section 10(2)(xv) of the Act the proper test to apply is, was that the payment made as a matter of practice which affected the quantum of salary or was there an expectation by the employee of getting a gratuity or was the sum of money expended on the ground of commercial expediency and in order indirectly to facilitate the carrying on of the business. J. P. Hancok vs General Raversionary & Investment Co. Ltd. and J. W. Smith vs The Incorporated Council of Law Reporting for England and Wales, , REFERRED TO.

Civil Appeal No. 211 of 1956. Appeal from the judgment and order dated July 19, 1955, of the Bombay High Court in Special Civil application No. 976 of 1955. A. V. Viswanatha Sastri, section N. Andley, Rameshwar Nath and P. L. Vohra, for the appellant. M. C. Setalvad, Attorney General for India, C. K. Daphtary, Solicitor General of India and B. Sen, for respondent No. 1. Vithlbhai B. Patel and I. N. Shroff, for respondent No. 2. 368 1961, December 21. The Judgment of Sinha C. J., Sarkar, Das Gupta and Mudholkar JJ., was delivered by Sarkar J. Ayyangar J., delivered a separate judgment. SARKAR J. The appellant is a City Municipality within the meaning of the Bombay District Municipal Act, 1901 and is governed by that Act. It had by a resolution duly passed by it, made a rule under section 60 of the Act selecting for the purpose of an octroi tax of /4/ annas per Bengali maund, milk brought within its octroi limits for consumption, use or sale therein. On November 29, 1954, the Government of Bombay had given its sanction to the rule under section 61 of the Act. The appellant Municipality thereafter published the rule and the sanction as required by section 62 of the Act and the tax was accordingly imposed with effect from January 1, 1955. On April 4, 1955, the Government of Bombay passed an order directing that the octroi tax shall not be leviable by the appellant Municipality. This order has given rise to the present proceedings. The appellant Municipality filed a petition in the High Court at Bombay under article 226 of the Constitution challenging the validity of the order. This petition was dismissed by the High Court. The appellant Municipality has now come up to this Court in appeal against the decision of the High Court. The questions that arise in this case will be stated after a few of the sections of the Act have been referred to. Chapter VII of the Act deals with municipal taxation. We shall be concerned principally with sections 59, 60, 61 and 62 which are all contained in this chapter and deal with imposition of taxes by Municipalities. It will be necessary also to consider section 46. Section 46 gives power to a Municipality to make rules for various purposes as specified in 369 the several clauses contained in it. Under cl. (i) of this section a Municipality has power to make rules for the purpose of "prescribing, subject to the provisions of Chapter VII, the taxes to be levied". Section 59 is the section on which the decision of this case will really turn and we, therefore, think it right to set out that portion of it which is relevant for our purpose. section 59. (1) Subject to any general or special orders the State Government may make in this behalf, any Municipality (a) after observing the preliminary procedure required by section 60 and (b) with the sanction of the State Government in the case of City Municipalities . . . and subject to such modifications or conditions as under section 61 the State Government. . . in according such sanction, deems fit, may impose, for the purposes of this Act, any of the following taxes, that is to say, . . . . . . . . (iv) an octroi on animals or goods, or both, brought within the octroi limits for consumption, use or sale therein; Section 60 lays down the procedure to be observed by a Municipality preliminary to imposing a tax. It requires that first a resolution shall be passed at a meeting to the Municipality selecting the tax and making rules for the proposes of cl. (i) of section 46 prescribing the tax. Thereafter the resolution has to be published with a notice in a specified form inviting the inhabitants of the Municipal 370 area to submit within a month their objections, if any, to the tax. After the objections have come in, they are to be considered by a committee of the Municipality and unless on the report of the committee the Municipality decides to abandon the tax, it has to submit the objections with its opinion thereon, any modifications it desires to make and the rules prescribing the tax to the State Government. Section 61 provides that on receipt of the rules and the other things mentioned in section 60 from the Municipality, the Government may refuse to sanction the rules, or return them to the Municipality for further consideration or sanctioned them with or without modifications or subject to conditions prescribed. Section 62 lays down that the rules as sanctioned by the Government shall be published by the Municipality and the tax shall, from the date which shall be specified in the notice publishing the rules, be imposed accordingly. It is not in controversy that in the present case the procedure prescribed in the sections mentioned above had been complied with. The Government 's contention is that the order made by it was competent as it was order which was authorised by section 59, subject to which only a tax could be imposed by a Municipality. The appellant Municipality does not dispute that it can impose a tax only under section 59 but it contents that the general or special orders mentioned in the section subject to which it has the power to impose tax, are orders which were in existence before the rule prescribing the tax was framed and once a rule has been framed by it and the Government has accorded its sanction to that rule, the Government has no power to control the imposition of tax under it by any order made under section 59. The question so raised is one of the construction of section 59. But for such construction we have to refer also to the other sections earlier mentioned. 371 In our opinion, the Government 's contention is well founded. The Municipality 's power to tax arises only under section 59. Under that section, it has been given the power of impose a tax after following the procedure prescribed but subject always to the general or special orders of the Government. The appellant Municipality can succeed in this appeal only if the word "impose" in section 59 means the acquisition of the power to tax by following the procedure laid down in sections 60 to 62. Its appeal must otherwise fail. It seems to us that the word "impose" in section 59 has not the meaning for which the appellant Municipality contends. It would have been noticed that under section 59 a Municipality may impose a tax only after it has framed a rule under section 60 prescribing the tax to be levied and the Government has given its sanction to that rule under section 61. It is this imposition which is made by section 59 "subject to any general or special orders which the State Government may make in this behalf". Therefore, it is the imposition after the making of the rule authorising the tax, that is subject to the Government 's orders and not the making of the rule itself which authorises the tax itself. It is plain from section 59 that the control over a Municipality 's power to tax imposed by the requirement of the Government 's sanction of the rule prescribing the tax in contained in section 61, is not the same thing as the control contemplated by the general or special orders mentioned in section 59, for both are mentioned in section 59. If it were not so, it would have been unnecessary to provide for the general or special orders controlling the imposition of the tax in section 59. This is the first reason why we think that the appellant Municipality 's contention is untenable. The imposition contemplated by section 59 is clearly not the passing of the resolutions under 372 section 60 selecting the tax and making the rule prescribing the tax to be levied in terms of section 46(i), for section 59(1)(a) expressly makes the imposition something happening after section 60 has been complied with. This seems to us to be another reason for not accepting the appellant Municipality 's contention. The third reason is to be found in section 62. As we have earlier stated, it provides that the tax shall be imposed from the date mentioned in the notice publishing the sanctioned rule. The choice of this date lies with the Municipality and not with the Government. The power to levy the tax is acquired by a Municipality when the rule prescribing the tax made by it is sanctioned by the Government. The Municipality at its own choice thereafter fixes a date from which it will collect the tax. Therefore, the word "impose" in section 62 does not refer to the acquisition of power to levy a tax by making the rule but to the actual levy of the tax under the power so acquired. It is of some significance to note that in section 46(i) the words used are "make. rules. prescribing. .the taxes to be levied". What we wish to point out is that in connection with the making of the rules the Act uses the word "levied" in section 46 (i) and in connection with an actual impost, and word "imposed" in section 62. We, therefore, think that it would be legitimate to construe the word "impose" in section 59 in the sense in which it has clearly been used in a connected provision, that is, section 62. Hence, in our view, "impose" in section 59 means the actual levy of the tax after authority to levy it has been acquired by rules duly made and sanctioned, and it is such imposition that is made subject to the general or special orders of the Government. Therefore, the Government can at any time by any such order prohibit the imposition of the tax. 373 Mr. Sastri for the appellant said that the general or special orders in section 59 refer to orders that can be made under section 73, but the present order had admittedly not been made under that section. Section 73 does not empower an order prohibiting the imposition of a tax altogether as the order in the present case does. It only gives power to suspend the levy of the tax authorised till the objections to the tax which the Government required to be removed, had been removed. Because section 73 gives a power to suspend the tax, it is, in our opinion, no argument that the general or special orders in section 59 must be understood as confined to such orders. Section 73 cannot help in interpreting the words "general or special orders" in section 59. A third objection to the validity of the order was that it was discriminatory. It was said that no other Municipality had been prohibited from collecting a similar tax which it had power under its rules to collect. Apart from the very interesting question raised by the learned Attorney General that the Municipality being a local authority, was a state, and was not therefore entitled to the benefit of article 14, as to which we think it unnecessary to express any opinion we are on the facts satisfied that there is no discrimination. The Government has now, it is not disputed, prohibited all Municipalities from levying any octroi tax on milk. Furthermore, it has not been shown to us that all Municipalities stand on the same footing with regard to milk. The last objection was that the order had been mala fide made. This grievance is completely without foundation. The Government had earlier requested the appellant Municipality to drop the tax on the ground, among others, that milk was really being purchased for the Government and that the Government was not liable to be 374 taxed by a Municipality. It may be that this ground was not justified on the facts, but as to this we do not come to any finding. It is clear to us that even if this stand taken by the Government was not tenable, that is no reason for thinking that the order was made mala fide. It was said that the Government had made this order to benefit respondent No. 2, a co operative union, dealing in milk. This is a bare allegation and is not supported by facts. In any event, since similar orders have now been made in respect of all Municipalities within the State, no question of mala fide can possibly arise. We think that the challenge to the order dated April 4, 1955 is without any foundation. In our view, the order was perfectly legitimate and must be upheld. We accordingly dismiss the appeal with costs. AYYANGAR J. I have had the advantage of perusing the judgment just delivered and I agree with order passed. The relevant facts and the statutory provisions which bear on the points arising in the appeal have all been set out by Sarkar J. and do not require to be repeated. There is no dispute that the levy of the duty by the municipality as and from January 1, 1955 was lawful because the requirements of sections 59 62 were satisfied when the levy was made. No general or special order of the State Government stood in the way of the municipality making the particular levy and the sanction of the State Government under section 59 (1) (b) had been accorded to it, and the relevant rules had conformed to the procedural and other requirements of these sections. The power of the municipality in the matter of the levy of the tax is, however, not absolute but it made subject, apart from other provisions to which I 375 shall advert, to such general and special orders as the State Government might pass by virtue of the opening words of section 59 of the Act. The argument strenuously pressed by Mr. Visvanatha Sastri was this: The Government had no doubt, a power to prescribe and control by general or special orders the right of a municipality to impose a tax. These general or special orders would again, no doubt, be subject to modification from time to time to suit the changing needs of particular areas, or of particular interests which would be affected by the tax levy, but the exercise of the power of modification or this power too prescribe conditions and restrictions is exhausted when a municipality does, by conforming to the orders then in force, impose a levy which has come into force under section 62. I am unable to agree with this construction of the opening words of section 59 (1). On its language there is nothing to warrant the doctrine that it gets exhausted by reason of a municipality imposing a tax in conformity with an order as it stood at a particular date. The limitation suggested must therefore, be deduced as a necessary implication either from the fasciculus of sections ending with section 62 leading to the imposition of a levy, or from other provisions of the Act. The other provision of the Act to which learned Counsel referred was section 73 which reads: "If it shall at any time appear to the Provincial Government, on complaint made or otherwise, that any tax, leviable by a Municipality, is unfair in its incidence, or that the levy thereof, or of any part thereof, is obnoxious to the interest of the general public, it may require the said Municipality, within such period as it shall fix in this behalf, to take measures for removing any objection which appears to it to exist to the said tax, 376 and if, within the period so fixed, such requirement shall not be carried into effect to the satisfaction of the Provincial Government, it may, by notification in the official Gazette, suspend the levy of such tax, or of such part thereof, until such time as the objection there to shall be removed. The Provincial Government may at any time, by a like notification, rescind any such suspension. " It is obvious that this section is of limited operation and confined to the subject it actually deals with. It posts the continued exaction of the impost, but points to the removal of anomalies and hardships in the details of the levy or of its administration. The existence of this provision would manifestly not suffice to negative the right of the Government to forbid the continued imposition of the tax altogether such as has been done in the present case. Section 73 cannot therefore be construed as negativing by implication the right claimed by the state Government under section 59, for it refers to and comprehends a totally different subject matter. Coming now to the construction of sections 59 62 as themselves supporting theory of the exhaustion of the power, the submission was this. "The general or special orders" could only restrict the power of a municipality "to impose a tax". On the scheme of provisions contained in sections 59 62 a tax was "imposed" only once, though when imposed and in operation the levy and collection of such a tax might be periodic and throughout the life of the imposition. Hence there was no scope for the exercise of the State Government to make "any special order" in relation to a tax after it has once been "imposed" because the power to prescribe conditions or restrictions by general or special order is with reference to the "imposition" of the tax. I feel unable to accept this construction. The whole foundation 377 of the argument is based on a denial of the premise that a power to impose tax is a continuing power. In my judgment the "imposition" of a tax is a continuing power in the sense that so long as it is in force, it points to the existence of and derives vitality from the power of the authority to impose it. When the municipality levies the tax in the sense of quantifying it with reference to an ascertained person and thereby creating a statutory debt payable by the tax payer, it is in reality exercising the power to "impose" the tax, for it is the continued existence of the imposition that furnishes the legal basis for the levy when made. When the power to impose is withdrawn the imposition falls to the ground. That is the ratio of saving provisions which enable taxes to be levied and collected not withstanding the deprivation of the right to impose taxes for the future. In this view it is clear that there is no exhaustion of the State power under the opening words of section 59 (1). In arriving at this construction I have also taken into consideration the scheme of the Act and the wide powers conferred on the State Government in the matter of control and supervision over the municipalities powers designed to ensure, that, subject of course to express statutory provision, municipal administration is coordinated to secure the vital interest of the general public. In this connection reference may be made to section 74 of the Act which reads: "Whenever it appears to the Provincial Government that the balance of the municipal fund of any Municipality is insufficient for meeting the expenditure incurred under section 175 or for the performance of any duties in respect of which they shall have been declared under section 178 to have committed default, the Provincial Government may be notification require the Municipality to impose 378 within the Municipal district, any such tax specified in the notification as may be imposed under section 59 if no such tax is at the time imposed therein, or to enhance any existing tax in such manner or to such extent as the Provincial Government considers fit, and the Municipality shall forthwith proceed to impose or enhance in accordance with the requisition such tax under the provisions of this Chapter as if a resolution of the Municipality had been passed for the purpose under section 60: Provided that: (a) the Provincial Government shall take into consideration any objection which the Municipality or any inhabitant of the Municipal district may make against the imposition or enhancement of such tax, (b) it shall not be lawful for the Municipality to abandon or modify or to abolish such tax when imposed, and (c) the Provision Government may at any time cancel or modify any requisition made by it under this section, and the levy of tax or the enhancement, except as to arrears theretofore accrued due. shall thereupon cease or be modified accordingly. " Government are thus empowered both to direct the municipality to impose tax when Government consider the same necessary in the interest of municipal finance and administration as also to direct the municipality to desist from continuing the imposition when the necessity ceases. In cases where a tax is imposed by the municipality by virtue of the provisions in sections 59 62, the municipality 379 itself could revoke the tax if the rules so provide, for section 47 of the Act enacts: (1) Subject to the requirements of clause (a) of the proviso to section 46 every Municipality may, except as otherwise provided in clause (b) of the proviso to section 74, at any time for any sufficient reason, suspend, reduce or abolish any existing tax by suspending, altering or rescinding any rule describing such tax under the provisions of clause (1) and of the first clause of the proviso to section 46. (2) The provisions of Chapter VII relating to the imposition of taxes shall, so far as may be, apply to the suspension, reduction or abolition of any tax and to the suspension, alteration or rescission of any rule prescribing a tax. " But for the opening words of section 59(1) there is no specific provision in the Act to enable Government to intervene in cases where the continued levy of a tax is contrary to public interest. I do not consider that any such gap was intended and in my judgement the opening words in section 59(1) are both apt and sufficient to clothe Government with power to direct by 'special order ' a municipality to desist from 'imposing ' a tax when satisfied that public interest so requires. The points raised regarding discrimination and mala fides are without substance and for the reasons stated by Sarkar J. I would reject them. The appeal therefore fails and has to be dismissed with costs. The Writ Petition which raises the same points as the appeal will also stand dismissed but without any order as to costs. Appeal dismissed.

After following the procedure prescribed by the Bombay District Municipal Act, 1901, and after obtaining the requisite sanction of the Government the appellant imposed an octroi tax on milk brought within its limits for consumption, use or sale therein. Shortly afterwards the Government passed an 367 order directing that the octroi tax shall not be leviable by the appellant. The appellant contented that the Government had no power to control the imposition of the tax once it had been properly imposed. ^ Held, that the Government was competent under section 59 of the Act to pass the order. Section 59 provided that subject to any general or special orders which the State Government may make, a Municipality may "impose" the tax after following the procedure laid down and after obtaining the sanction of the Government. The word "impose" in section 59 meant the actual levy of the tax after authority to levy it had been acquired by rules duly made and sanctioned and this imposition was subject to the general or special orders of the Government. The general and special orders under section 59 could not be confined to orders under section 73 which gave the Government power to suspend the tax in certain cases. Held, further, that the order of the Government was not discriminatory. Subsequently the Government had prohibited all municipalities from levying octroi tax on milk. For the same reason no question of mala fides could arise. Per Ayyangar, J. Imposition of tax was a continuing power deriving vitality from the power of the authority to impose it. The power of the Government to issue special or general order under section 59 was therefore not exhausted after "imposition" of the tax. There were provisions in sections 47, 73 and 74 for other contingencies but except for the opening words of section 59 there was no provision to enable Government to intervene in cases where the continued levy was against public interest. The opening words of section 59 clothed the Government with power to direct a municipality to desist from imposing a tax.

Civil Appeals Nos. 140 to 142 of 1952. Appeals from the judgment and order dated March 24, 1953, of the former Nagpur High Court in Misc. Petitions Nos. 1795 1796 of 1951 and 1 of 1952. WITH Petitions Nos. 24, 25 and 93 of 1952. Petition under article 32 of the Constitution of India for enforcement of Fundamental Rights. G.S. Pathak, S.N. Andley, J.B. Dadachanji and Rameshwar Nath, for the Appellants/petitioners. H.N. Sanyal, Additional Solicitor General of India, N.S. Bindra, R.H. Dhebar and T.M. Sen, for the respondents. C.R. Pattabhi Raman and R. Ganapathy Iyer, for the interveners (in C.A. No. 141 of 1954). 1961, December 11. The judgment of S.J. Imam, K.C. Das Gupta, Raghubar Dayal and N. Rajagopala Ayyangar, JJ., was delivered by Rajagopala Ayyangar, J., J.L. Kapur, J., delivered a separate judgment. AYYANGAR, J. The appellants in Civil Appeal 140 of 1954 are tobacco merchants and manufacturers of biris. They own private warehouses licensed under r. 140 of the Excise Rules, 1944 at Gondia and other places in Madhya Pradesh. On the 28th of February, 1951 a Bill was introduced in the House of the People, being Bill 13 of 1951 containing the financial proposals of the Government of India for the fiscal year beginning the 1st of April, 1951. Clause 7 of the Bill made provision for the amendment of the 4 Central Excise Act (Act 1 of 1944) by way of alteration of duties on "tobacco manufactured and unmanufactured." In particular, it provided that "unmanufactured tobacco other than flue cured and ordinarily used otherwise than for the manufacture of cigarettes" (which included tobacco intended for manufacture into biris) should be charged to an excise duty of 8 annas per lb. and it also imposed a new duty of excise on biris varying from 6 to 9 annas per lb. depending upon the weight of tobacco contained in the biris. Section 3 of the (Act XVI of 1931) enacted "Where a bill introduced into the Indian Parliament provided for the imposition or increase of a duty of excise the Central Government might cause to be inserted in the bill a declaration that it was expedient in the public interest that any provision of the bill relating to such imposition or increase shall have immediate effect under this Act". A declaration under this section was made in respect of the provision for imposing the duties on tobacco under cl. 7 of the bill already adverted to. The effect of such a declaration was stated in section 4 of Act XVI of 1931 in the following terms: "4. (1) A declared provision shall have the force of law immediately on the expiry of the day on which the Bill containing it is introduced. (2) A declared provision shall cease to have the force of law under the provisions of this Act (a) When it comes into operation as an enactment with or without amendment, or (b) when the Central Government in pursuance of a motion passed by parlia 5 ment, directs, by notification in the Official Gazette, that it shall cease to have the force of law, or (c) if it has not already ceased to have the force of law under clause (a) or clause (b), then on the expiry of the sixtieth day after the day on which the Bill containing it was introduced. " In compliance with this law the appellants paid the excise duty at the rates imposed under cl. 7 of the bill and obtained clearance certificates in regard to the tobacco moved out from their warehouses from and after March 1, 1951. Bill 13 of 1951 was passed into law as the Indian Finance Act 1951 (Act XXIII of 1951 on April 28, 1951 but as passed, changes were effected in the duty proposed in the bill, as a result of certain alterations suggested by the Select Committee. Under section 7 (1) of the Finance Act 1951 while the excise duty on biris was abandoned, the duty on unmanufactured tobacco (other than flue cured and used in the manufacture of cigarettes) was increased to 14 annas per lb. from the rate of 8 annas per lb. in the bill. Consequential provisions were enacted in section 7 (2) of the Finance Act which read: "The amendments made in the Central Excise and Salt Act 1944, sub cl. 1 shall be deemed to have effect on and from the 1st March, 1951 and accordingly: (a) refund shall be made of all duties collected which would not have been collected, if the amendment had come into force on that day, and (b) recoveries shall be made of all duties which have not been collected but which would have been collected if the amendment had so come into force." 6 In pursuance of section 7 (2) a demand was made upon the appellants on June 22, 1951 for the payment of the duty payable by them, after giving credit for the refund of the duty paid on biris which had been deleted by the Act. The appellants contested the legality of this demand by a petition under article 226 which they filed in the High Court at Nagpur urging that the retrospective operation given to section 7(1) by sub s.(2) thereof was illegal, ultra vires and unconstitutional, and besides that the provision in r. 10 of the Excise Rules which contained the machinery for enforcing the demand was not adequate to meet the situation arising out of the change in the law from the provisions of the bill to those of the Act. The learned Judges of the High Court repelled all the contentions disputing the legislative competence and the constitutionality of the legislation contained in section 7(2) of the Finance Act of 1951, but they upheld the objection to the adequacy of the procedure for recovery based on the limited scope of r. 10 of the Excise Rules. Thereafter the Central Government, by a notification dated December 8 1951, amended the Central Excise Rules, 1944 by the addition of a new r. 104 providing machinery specially designed f r the enforcement of a demand like the one arising in the circumstances of the present case. On December 12, 1951 a further and a fresh demand was made for the payment of the duty in terms of section 7(2)(b) of the Finance Act quoted earlier, and the appellants thereupon once again moved the High Court of Nagpur under article 226 challenging the validity of the demand on the very same grounds as before. This petition was heard by a Full Bench of the Court and every contention raised by the appellants including that based on the adequacy of the new r. 10A to cover the present case was rejected. The learned Judges granted a certificate under article 132 of the Constitution which was enabled the appellants to file this appeal. Before proceeding further it is only necessary to state that there is no material difference between the facts of the 7 cases covered by Civil Appeals 141, 142 as well as the points raised in the Writ Petitions and that this judgment will cover and dispose of the other appeals and the petitions. We might also, at this stage mention that other parties who were similarly situated as the appellants in Civil Appeals 140 to 142 of 1954 and who had filed petitions under article 226 of the Constitution in the High Court of Madras which arc pending there, raising the same points as the appellant 's before us, have intervened in these appeals and they have also been heard. Learned Counsel appearing for the interveners adopted the arguments urged in support of the appeal. Mr. Pathak, learned Counsel who appeared for the appellants urged three point in support of the appeals(1) Section 7 (2) of the Finance Act, 1951 in so far as it imposed an excise duty retrospectively before the date of its enactment (April 28, 1951) was beyond the legislative competence of Parliament. The contention on this head was briefly this: The impugned tax was imposed by Parliament in purported exercise of the power to levy "a duty of excise on tobacco" within Legislative Entry 84 of Union list which reads: "Duties of excise on tobacco and other goods manufactured or produced in India except An "excise" was basically an indirect tax, i.e., a tax or duty not intended by the taxing authority to be borne by the person on whom it is imposed and from whom it is collected but is intended to be passed on to those who purchased the goods on which the duty was collected; but when such a tax was imposed with retrospective effect it could not be passed on, so such a levy deprived the tax of its essential characteristic of being indirect. It therefore ceased to be a "duty of excise" and 8 became a personal tax of a category quite distinct from "excise" and so was beyond the legislative power of Parliament under that Entry. (2) That the impugned levy was unconstitutional in that it contravened the fundamental right guaranteed to the citizens of India to hold property under article 19(1)(f), the point urged being that a retrospective levy of an "excise duty" deprived the tax payer of the right of passing it on and recovering it from his buyer, that this constituted a restraint on "the right to hold property" (the amount of the tax levy) conferred by article 19(1)(f) and was not saved by cl. 5 of that Article as being a reasonable restraint and should, therefore, be struck down under article 13(2). (3) That the terms of r. 10A of the Excise Rules 1944 were insufficient to cover the cases of the appellants and that in consequence the demand made on them and the attempt to recover the sums by resort to the coercive process provided for by section 11 of the central Excise Act was illegal and without statutory authority. We shall now proceed to consider these points in that order. (1) Want of legislative competence: To appreciate the submission of learned Counsel it is necessary to set out the steps in the reasoning by which he sought, to establish that a "duty of excise" when imposed with retrospective effect ceased to be a "duty of excise" as used in Entry 84 of the Union List. The submission of learned Counsel was this: The term "duty of excise" on goods was universally recognized as a tax on home produced goods and as a typical instance of an indirect tax. It was a tax on the activity of production or manufacture of goods within the country and that it was levied on or collected from tho producer or manufacturer or from those who held such goods. It was, further, not a personal tax but its essential and characteristic nature, which distinguished it from other types of taxes was that it was levied on goods. It had, therefore, in order that it might 9 truly be "duty of excise", to satisfy two tests: (a) It had to be an indirect tax, i.e. levied in such a manner that the person from whom the tax was collected was in a, position to pass it on to those who acquired the goods from him or at least the taxing authority expected him to pass it on, and laid no impediment on his ability to do it. (b) Being a tax on goods, it was levied on the producer or manufacturer or person in possession of the goods at the time when the person taxed was the owner or had possession and control over the goods. Where neither of these essential elements or attributes was present, and in the present, case, according to learned Counsel neither condition was satisfied, the tax levy would not fall under the category of "duty of excise. " The same argument was Presented in a slightly different from by saying that though Parliament, generally speaking, had the power to legislate in respect of everyone of the subjects included in the relevant legislative entries whether prospectively, or retrospectively including legislation with regard to taxation, still if the retrospective levy of a taxes, altered its essential nature and identity, then the power to legislate retrospectively would be open to Parliament only if the tax in its altered from i.e., a tax direct and personal would be open to Parliament to impose. In the case of a "duty of excise" as the tax in the present case was, if imposed retrospectively, deprived it of its essential characteristic of being in indirect tax and a tax on goods, and so the power of Parliament to enact such retrospective legislation would depend upon whether Parliament could impose a tax on a person merely because he happened to produce goods at an antecedent date, or, happened to have had in his control goods of indigenous production at a prior date and if this could not be done, it would follow that Parliament could not impose a "duty of excise" with retrospective effect. 10 In support of his submission regarding the nature of an excise duty and that meaning that ought to be attributed to the expression as it occurs in Entry 84 of the union List, Mr. Pathak placed before us judgments of the Privy Council in appeals from Canada and some decisions of the American Supreme Court and of the Australian High Court. First as to the decisions relating to the Canadian constitution though learned Counsel referred us to several decisions on the interpretation of the word "excise" in connection with the distinction between direct and indirect taxes in most of the British North America Act, 1867, we do not think it necessary to refer to all of them. The general line of approach of the Privy Council decisions referred by learned Counsel could be gathered from the observations of Lord Cave in City of Halifax vs Fairbanks ' Estate. The impugned tax legislation was a business tax imposed by the Province of Nova Scotia to be paid by every occupier of real property for the purposes of any trade, profession, or other calling carried on for the purpose of gain, the assessment being according to the capital value of the premises. This was challenged inter alia on the ground that it was an indirect tax and therefore not within the legislative competence of the Provincial Legislature. Lord Cave said: "Thus, taxes on property or income were everywhere treated as direct taxes; and John Stuart Mill himself, following Adam Smith, Ricardo and James Mill, said that a tax on rents falls wholly on the landlord and cannot be transferred to any one else. . On the other hand, duties of customs and excise were regarded by every one as typical instances of indirect taxation. When therefore the Act of Union allocated the power of direct taxation for Provincial purposes to 11 the Province, it must surely have intended that the taxation, for those purposes, of property and income should belong exclusively to the Provincial legislatures, and that without regard to any theory as to the ultimate incidence of such taxation. To hold otherwise would be to suppose that the framers of the Act intended to impose on a Provincial legislature the task of speculating as to the probable ultimate incidence of each particular tax which it might desire to impose, at the risk of having such tax held invalid if the conclusion reached should afterwards be held to be wrong. . . The imposition of taxes on property and income, of death duties and of municipal and local rates is, according to the common understanding of the term, direct taxation, just as the exaction of a customs or excise duty on commodities. . would ordinarily be regarded as indirect taxation; and although new forms of taxation may from time to time be added to one category or the other in accordance with Mill 's formula as a ground for transferring a tax universally recognised as belonging to one class to a different class of taxation." Similar passages in relation to a "duty of excise" being an indirect tax occur in other judgments of the Judicial Committee to which learned Counsel drew our attention. Of these, it is sufficient to refer to one more Attorney General for British Columbia vs Kingcome Navigation Company, Limited which raised the question as to whether a tax which was imposed upon every consumer of fuel oil according to the quantity which he had consumed imposed by the Fuel Oil Tax Act of 1930 of British Columbia was a direct tax under section 92, head 2, of the British North America Act, 1867. After extracting the following passage from Bank of Toronto vs Lambe: 12 "A direct tax is one which is demanded from the very persons who it is intended or desired should pay it. Indirect taxes are those which are demanded from one person in the expectation and intention that he shall indemnify himself at the expense of another; such are the excise or customs. Lord Moulton who delivered the judgment of the Board referred to the passage from the judgment of Lord Cave in City of Halifax vs Fairbanks ' Estate just now quoted and went on to add: "The ultimate incidence of the tax in the sense of the political economist, is to be disregarded, but where the tax is imposed in respect of a transaction, the taxing authority is indifferent as to which of the parties to the transaction ultimately bears the burden . . . Similarly, where the tax is imposed in respect of some dealing with commodities, such as their import or sale, or production for sale, the tax is not a peculiar contribution upon the one of the parties to the trading in the particular commodity who is selected as the tax payer. This is brought out in the second paragraph of Mill 's definition, and is true of the typical custom and excise duties referred to by Lord Cave. " The tax was therefore held to be valid. We consider that not much assistance could be derived from these decisions for the interpretation of the scope or content of the term "duties of excise" in Entry 84 of the Union List. The line of division in Canada between those taxes which a Province could impose and those which it could not was, whether it was direct or indirect. In Canada, taxing powers are divided between the Dominion and the Provinces on the basis of the incidence of the tax, the Dominion power extending to "any mode or system of taxation" (vide section 91 (3) British North America Act, 1867) while that of the 13 Provinces is restricted to "direct taxation within the Province in order to the raising of revenue for provincial purposes" (Section 92(2) ibid). When therefore the validity of any Provincial tax legislation is challenged in Canada the enquiry is as regards the normal incidence of the tax whether it is "direct" or "indirect." As these expressions had a settled meaning in economic theory, the Courts had necessarily to find out whether the particular tax imposed by the Province fell within the class of "indirect" taxes or not. In such a situation naturally the classification by economists of taxes as those which are "direct" as distinct from those which are "indirect" assumed a vital role in deciding whether the tax impugned is or is not within Provincial power. As pointed out by Gwyer, C.J. in the Province of Madras vs Boddu Paidanna: "The Canadian cases which were cited do not seem to afford any assistance, since analogous problems in Canada are always concerned with questions of direct and indirect taxation; and if a Provincial tax is held to be an indirect tax, it is unnecessary for the Court to consider whether it may not also be a duty of excise: see, for example Att. for British Columbia vs The Canadian Pacific Railway Co. , where a tax on every person purchasing within the Province fuel oil for the first time after its manufacture in, or importation into, the Province was held to be invalid as an indirect tax, and the question whether it might not also be bad as an excise duty was left unanswered. In contrast to the case just cited we may refer to Att. Gen. for British Columbia vs Kingcome Navigation Co. in which a fuel oil tax imposed by a Province upon every consumer of fuel oil according to 14 the quantity which he had consumed was held to be valid as a direct tax, because it was demanded from the very persons who it was intended or desired should pay it. " Similarly, Lord Simonds observed in Governor General in Council vs Province of Madras: "little assistance is to be derived from the consideration of other federal constitutions and of their judicial interpretation. Here there is no question of direct and indirect taxation, nor of the definition of specific and residuary powers. " Under the Indian Constitution the scheme of division of the taxing powers between the Union and the States is not based on any criterion dependent on the incidence of the tax. Sir Maurice Gwyer in In re the Central Provinces and Berar Act XIV of 1938 speaking of the word "excise" as occurring in the legislative lists in the Government of India Act (and for this purpose there is no variation in the lists in Schedule VII of the Constitution) said: "Its primary and fundamental meaning in English is that of a tax on articles produced or manufactured in the taxing country and intended for home consumption. I am satisfied that this is also its primary and fundamental meaning in India; and no one has suggested that it has any other meaning in Entry No. 45 (corresponding to Entry 84 in the Union List). It was then contended on behalf of the Government of India that an excise duty is a duty which may be imposed upon home produced goods at any state from production to consumption; and that therefore the federal legislative power extended to imposing excise 15 duties at any stage. This is to confuse two things, the nature of excise duties and the extent of the federal legislative power to impose them . . There can be no reason in theory why an excise duty should not be imposed even on the retail sale of an article, if the taxing Act so provides. Subject always to the legislative competence of the taxing authority, a duty on home produced goods will obviously be imposed at the stage which the authority find to be the most convenient and the most lucrative, wherever it may be; but that is a matter of the machinery of collection, and does not affect the essential nature of the tax. The ultimate incidence of an excise duty, a typical indirect tax, must always be on the consumer, who pays as he consumes or expends; and it continues to be an excise duty, that is, a duty on home produced or home manufactured goods, no matter at what stage it is collected. " As Lord Simonds said in the decision, to which reference has already been made after referring to the decision of the Federal Court in the C.P. Petrol case: "Consistently with this decision their Lordships are of opinion that a duty of excise primarily a duty levied on a manufacturer or producer in respect of the commodity manufactured or produced. It is a tax on goods not on sales or the proceeds of sale of goods," and then speaking about taxes on sale of goods the learned Lord continued: "The two taxes, the one levied on a manufacturer in respect of his goods, the other on a vender in respect of his sales, may, as is there pointed out, in one sense overlap. But in law there is no overlapping. The taxes 16 are separate and distinct imposts. If in fact they overlap, that may be because the taxing authority, imposing a duty of excise, finds it convenient to impose that duty at the moment when the exciseable article leaves the factory or workshop for the first time on the occasion of its sale. But that method of collecting the tax is an accident of administration; it is not of the essence of the duty of excise, which is attracted by the manufacture itself. " In view of this clear exposition of the content of the term "duty of excise" in the Indian setting we think, no assistance can be derived for the meaning ascribed and the characteristics attributed to it in the decision construing the relative taxing powers of the Dominion and the Provinces under the British North America Act 1867. Before dealing with the Australian decision to which Mr. Pathak drew our attention, we could conveniently dispose of the American cases which were referred to by the learned counsel bearing on the meaning of the word "excise". We might point out that the American decisions do not assist the appellant in the least since under the Constitution of the United States practically every tax other than a capitation, a poll tax or a tax on land is termed an "excise duty" and even income tax was held to be an 'excise ' until the decision of the Supreme Court of the United States in Pollock vs Farmers Loan & Trust Co. It has to be borne in mind that the American Constitution provides that direct taxes have to be apportioned among the States according to their respective populations (article 1, section 2, and article 1, section 9, cl. 4). Hence the attempt in the United States has been to bring taxes which according to the classification of economists would be direct taxes within the category of excise or indirect taxes which need not follow the rule as to apportionment among the States. It follows, 17 therefore, that neither the American decisions, nor the understanding by the Courts of that country as to what a duty of excise connotes can be of any utility for deciding the content of that entry in the Indian Constitution. The relevance of the American decisions is, therefore, even remoter than the decisions from Canada which were relied on by the learned Counsel. Mr. Pathak referred us to some of the decisions in Australia and in particular to Parton vs Milk Board (Victoria) in support of his submission that the characteristic of being an indirect tax and therefore the capability of being passed on was an essential ingredient and pre requisite of an excise duty. In this connection it is necessary to point out that the decisions in Canada which were relied on by Mr. Pathak as aids for understanding the import of the expression "duty of excise" in Entry 84, have been treated by the Australian Courts as not helpful to determine the meaning of "excise" in section 90 of the commonwealth of Australia Act. As explained by Wynes: "In Canada, the distribution of taxation is based upon the direct and indirect character thereof, the Provincial power being limited to direct taxation within the Province. Hence Canadian cases such as the Bank of Toronto vs Lambe are of very little use in settling the question whether or not a tax is a duty of customs or excise within the meaning of the Australian Constitution. It may be pointed out that under the Australian Constitution taxes levied on commercial dealings in goods produced, such as taxes on sales, have been held to fall within the category of excises. Several of the decisions of the Australian High Court rendered before Parton vs Milk Board (Victoria dealing with what constituted an excise 18 under section 90 of the Commonwealth of Australian Act were cited to the Federal Court in the Province of Madras vs Boddu Paidanna and the learned Chief Justice, after referring to them in detail, observed: "We find it impossible to say that the expression 'duties of excise ' even in Australia is limited to duties imposed in connection with the production of a commodity alone. We should be disposed to say on the contrary that in Australia all taxes on the sale of commodities are, or may be regarded, as, duties of excise. . Under the Australian Constitution power to impose duties of excise is, as we have said, the exclusive right of the Commonwealth Parliament; the residuary taxing power remains in the States. In the Indian Constitution Act the whole of the taxing power in this particular sphere is expressly apportioned between the Centre and the Provinces, to the one being assigned the power to impose duties of excise, to the other taxes on the sale of goods. " The decision in the Milk Board case follows in general the same lines as did the earlier decisions which have been detailed and discussed by Sir Maurice Gwyer C. J. in Paidanna 's case. In these circumstances we do not consider it useful or necessary to discuss these decisions. Undoubtedly, there are passages in these judgments in the Australian Courts which refer to the fact that an excise duty is an instance of an indirect tax. As regards the general proposition, however, there is little controversy, but these decisions did not lay down that if by reason of the tax being levied retrospectively the duty cannot be passed on it ceased to be a duty of excise. On the other hand, there is express and high authority for the position that a duty of excise could be validly levied with retrospective effect under the Australian Constitution. The question for 19 consideration before the privy Council in Colonial Sugar Refining Company Ltd. vs Irving related to the constitutional validity of the Excise Tariff Act, 1902, passed by the Commonwealth Parliament. One of the objections raised to the levy was that on the terms of the enactment which was passed on the 26th of July, 1902, the imposition of the duty could be as and from October 8, 1901, the day on which the Minister had moved a resolution to that effect in the committee of Ways & Means of the House of Representatives. The respondent before the Board who were manufacturers of refined sugar in Brisbane in the State of Queensland questioned the legality of the tax which had been demanded and paid by them in respect of the sugar produced by them between October 8, 1901, and July 26, 1902. Lord Davey delivering the judgment of the Board observed: "It is a little difficult to understand the first point taken by the appellants. The Parliament had undoubted power to impose taxation under the express words of section 51 of the Constitution, and it is not now disputed that the Parliament could, if it thought fit, make the Act retrospective and impose the duties from the date of the resolution. That practice is (it is believed) universally followed in the imperial Parliament, and (their Lordships were told) is common in the Colonial Legislatures in Acts of this description, and for obvious reasons it is convenient and almost necessary. There was nothing, therefore, in either the subject matter of the Act, or in the mode of dealing with it, which was beyond the power of the Parliament. " In our opinion, the above aptly describes and covers the point raised by the appellants in the appeals now before us. 20 There is no doubt that excise duties have been referred to by the economists and in the judgments of the Privy Council as well as in the Australian decisions as an instance of an "indirect tax", but in construing the expression "duty of excise" as it occurs in Entry 84 we are not concerned so much with whether the tax is "direct" or "indirect" as upon the transaction or activity on which it is imposed. In this context one has to bear in mind the fact that the challenge to the legislative competence of the tax levy is not directed to the imposition as a whole but to a very limited and restricted part of it. This challenge is confined (a) to the operation of the tax between the period March 1, 1951, and April 28, 1951, and (b) even in regard to this limited period, it is restricted to the imposition of the additional duty of six annas per lb. which was levied, beyond the eight annas per lb. collected from the appellants by virtue of the Finance Bill under the provisions of the . It would seem to be rather a strange result to achieve that the tax imposed satisfies every requirement of a "duty of excise" in so far as the tax operates from and after April 28, 1951, but is not a "duty of excise" for the duration of two months before that date. Learned Counsel conceded, as he had to, that even on the decision relied upon by him, the fact that owing to the operation of economic forces it was not possible for the taxpayer to pass on the burden of the tax, did not alter the nature of the imposition and detract from its being a "duty of excise". For instance, the state of the market might be such that the duty imposed upon and collected from the producer or manufacturer might not be capable of being passed on to buyers from him. Learned Counsel urged that this would not matter, as one had to have regard to "the general tendency of the tax" and "the expectation 21 of the taxing authority" and to the possibility of its being passed on and not to the facts of any particular case which impeded the operation of natural economic forces. The impediment to the duty being passed on might be due not merely to private bargains between the parties or abnormal economic situations such as the market for a commodity being a buyers ' market. Such impediments may be brought about by the operation of other laws which Parliament might enact, such for instance, as control over prices. If in such a situation were the price which the producer might charge his buyer is fixed by the statute, say under the Essential Supplies Act, and a "duty of excise" is later imposed on the manufacturer, it could not be said that the duty imposed would not answer the description of an "excise duty". Learned Counsel had really no answer to the situation created by such a control of economy except to say that it would be an abnormal economic situation. It could hardly be open to argument that a tax levied on a manufacturer could be stated not to be a "duty of excise", merely because by reason of the operation of other laws the tax payer was not permitted to pass on the tax levy. The retrospective levy of a tax would be one further instance of such inability to pass on, which doses not alter the real nature or true character of the duty. It might further be pointed out that the submission of the learned Counsel that a tax which according to economic theory is an indirect tax or a tax on goods becomes a direct and a personal tax and a tax of a different nature or category if imposed retrospectively because it was then incapable of being passed on, does not correctly represent the law as laid down by this Court. In common with duties of customs and excise, a tax on the sale of goods is another instance of a typical indirect tax 22 Indeed Lord Thankerton pointed out in Attorney General for British Columbia vs Kingcome Navigation Company Ltd.: "The ultimate incidence of the tax in the sense of political economist is to be disregarded and referred to a tax imposed in respect of some dealings in commodities such as their import or sale or production for sale as instances of indirect taxes, the tax not being a peculiar contribution upon one of the parties to the trading in the particular commodity selected as the tax payer. " The question of the validity of the imposition of a sales tax with retrospective effect came up for consideration before this Court in the Tata Iron & Steel Co. Ltd. vs The State of Bihar. An argument similar to the one now presented before us was submitted to this Court in challenge of that levy which was summarized by Das, C.J., in these terms: "The retrospective levy by reason of the amendment of section 4(1) (of the Bihar Sales tax Act which was impugned) destroys its character as a sales tax and makes it a direct tax on the dealer instead of an indirect tax to be passed on to the consumer. " Dealing with this point the learned Chief Justice said : "The argument is that sales tax is an indirect tax on the consumer. The idea is that the seller will pass it on to his purchaser and collect it from them. If that is the nature of the sales tax then, urges the learned Attorney General, it cannot be imposed retrospectively after the sale transaction has been concluded by the passing of title from the seller to the buyer, for it cannot, at that 23 stage, be passed on to the purchaser. . . Once that time goes past, the seller loses the chance of realising it from the purchaser and if it cannot be realised from the purchaser, it cannot be called sales tax. In our judgment this argument is not sound. From the point of view of the economist and as an economic theory, sales tax may be an indirect tax on the consumers, but legally in need not be so. . This also makes it clear that the sales tax need not 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 . . If that be the true view of sales tax then the Bihar Legislature acting within its own legislative field had the powers of a sovereign legislature and could make the law prospectively as well as retrospectively. We do not think that there is any substance in this contention. " In our judgment this passage covers the argument regarding a duty of excise getting its essential nature altered and ceasing to be a duty of excise if imposed retrospectively. The submission, therefore, lacks any force and is rejected. It is also necessary to refer to one further matter : Even assuming that the learned Counsel is right in his submission, that to be a duty of excise within Entry 84 of the Union List the taxing authority should have expected the tax to be passed on, we consider that learned Counsel is not right in submitting that condition is not satisfied in the case of the levy now impugned. The provisions of the impugned enactment have to be read in the light of section 64A of the Sale of Goods Act which enacts: "In the event of any duty of customs or excise on any goods being imposed, increased decreased or remitted after the making of any 24 contract for the sale of such goods without stipulation as to the payment of duty where duty was not chargeable at the time of the making of the contract, or for the sale of such goods duty paid where duty was chargeable at that time: (a) if such imposition or increase so takes effect that the duty or increased duty, as the case may be or any part thereof, is paid, the seller may add so much to the contract price as will be equivalent to the amount paid in respect of such duty or increase of duty, and he shall be entitled to be paid and to sue for and recover such addition, and (b) if such decrease or remission so takes effect that the decreased duty only or no duty, as the case may be, is paid, the buyer may deduct so much from the contract price as will be equivalent to the decrease of duty or remitted duty and he shall not be liable to pay, or be sued for or in respect of, such deduction. " This provision originally formed section 10 of the Tariff Act VIII of 1894 and was subsequently enacted as section 10 in the Indian Tariff Act of 1934 (cl Act XXXII of 1934). The object of the statutory provision is that where contracts for the sale of goods are entered into and the price payable therefor determined on the basis of existing rates of duty either of excise or of customs neither party shall be prejudiced or advantaged by reason of the increase or decrease of the duty. The question as to the scope of section 10 of the Tariff Act of 1894 came up for consideration before a Bench of the Madras High Court whose decision is reported in Narayanan v, Kadir Sahib (1). The suit out of which the second appeal before the High 25 Court arose was by a buyer of salt for the refund of salt excise duty which had been reduced after the date of the contract. The transaction of sale between the plaintiff and the defendant took place on March 5, 1922, and the price payable by the plaintiff was based on the rate of duty prevailing on that date. Subsequent thereto the Government of India reduced the duty on salt from Rs. 5/ to Rs. 2/8/ per bag and this was to have effect from a date prior to March 5, 1922. The defendant firm (the sellers) had obtained from the Government refund of the duty on the salt sold by them to the plaintiff. It was to recover this amount of duty that the suit was filed by the buyer. The learned Judges held that on the terms of s, 10 of the Tariff Act of 1894 (indentical with section 64A of the Sale of Goods Act) the fact that the contract was no longer executory but that delivery had been made and the price paid, was no bar to the plaintiff succeeding in his suit. It will be seen that section 64A is in two parts: the first cl. (a) dealing with the case of an increase in duty and conferring on the seller the right to recover the amount of the increased duty from the buyer, and the second limb (cl. b) making provision regarding the correlated case of a reduction in the duty with corresponding rights to the buyer to obtain the benefit of a reduction. Whatever argument might be raised baned upon the language of the second limb of the section, it is not open to doubt that in the case of an increase in duty, the seller would be entitled to recover the duty from the buyer provided: (a) there was no contract to the contrary by which he had precluded himself from claiming such enhanced duty, i. e., the contract having negatived or limited the seller 's right to prefer such a claim, or was at least silent as regards what was to happen in the event of the duty being increased, (b) the change in the rate of duty was effected after the date of the contract. In 26 these circumstances, it appears to us that there might not be even a factual basis for the complaint of learned Counsel for the appellants that in the case of a retrospective increase in duty, the duty ceases to be a duty of excise by becoming a "direct" tax because it was incapable of being passed on. The answer of learned Counsel to this point regarding the operation of section 64A of the Sale of Goods Act was merely that the Court could not take account of the provisions of another statute for dealing with the validity of a provision of the Finance Act 1911. The submission has no force at all because section 64A of the Sale of Goods Act refers in express terms to "duties of excise" and has therefore, to be read as part and parcel of every legislation imposing a duty of excise. In view of our conclusion, however, that the duty in the present case, notwithstanding its imposition with retrospective effect, and even if it be that it was incapable of being passed on to a buyer from the tax payer, was a duty of excise within Entry 84 as properly understood it is not necessary to rest it upon this narrower ground. In our view, a duty of excise is a tax levy on home produced goods of a specified class or description, the duty being calculated according to quantity or value of the goods and which is levied because of the mere fact of the goods having been produced or manufactured and unrelated to and not dependent on any commercial transaction in them. The duty in the present case satisfies this test and therefore it is unnecessary to seek other grounds for sustaining the validity of the tax. One further aspect of the matter on which some emphasis was laid by Mr. Pathak was that a duty of excise was in its essence a tax on goods and not a personal tax a levied on the tax payer such as an income tax. He urged that being a tax levied on goods notwithstanding that it was 27 collected from the producer or manufacturer, it followed that the essential attribute or characteristic of that duty was that the producer or manufacturer must own or have possession and control over the goods at the moment of the levy. If this element of ownership, possession or control over the goods by the tax payer was lacking, learned Counsel urged the duty would not be a duty on the goods but a personal tax levied on the tax payer. This is really another aspect of the same argument that a duty of excise is in its nature an indirect tax but learned Counsel submitted that viewed from this angle it would be seen that the duty imposed by the impugned enactment was shown to be not a duty of excise. The grounds upon which the submission of learned Counsel that a duty of excise levied retrospectively was converted into a direct tax and therefore not a duty of excise have been repelled by us which ought to suffice to repel the contention in this form also. Besides, it may also be pointed out that even in strict theory there is no basis for the submission now under consideration. The duty imposed by the impugned Act being retrospective, it operates as from a previous date and admittedly on the date when by force of the enactment the duty was levied the tax payer was the owner or was in possession and control of the goods. To deny this, would in effect deny the legal effect of the tax being imposed retrospectively and fictionally deemed to be in force on an earlier date. In dealing with the arguments of learned Counsel on the scope and content of Entry 84 of the Constitution and of the meaning of the expression "duty of excise" in that entry we have also covered the special argument questioning the right of Parliament to impose retrospectively a duty of excise. It was conceded, that Parliament has power to enact laws with retrospective effect and as it was not suggested that laws 28 dealing with taxation are any exception to that rule the only ground upon which the learned Counsel could rest this submission was that being an indirect tax, capability of being passed on was an essential characteristic or requirement of a duty of excise, and so its imposition with retrospective effect deprived it of that essential character and therefore rendered it a duty of a different nature and for that reasons a retrospective imposition of an excise duty was not permissible. It would be seen that this is really the same argument which we have dealt with earlier presented in another form. For the reasons already stated, we find no substance in this form of argument either and we have no hesitation in rejecting it. It need only be mentioned that the passage in judgment of Lord Davey in the Colonial Sugar Refining Company Ltd. vs Irving, already extracted, is sufficient precedent, if authority were needed, to reject this argument. The second point raised by learned Counsel was that the impugned section 7(2) of the Act was unconstitutional in that it contravened the fundamental rights guaranteed under articles 19(1)(f) and 31(1) and (2) of the Constitution. It was urged that even if the impugned provision was within the legislative competence of Parliament as being covered by Entry 84 of the Union List, the retrospective levy of an excise duty violated the freedom guaranteed by article 19 (1)(f) the right to hold property and was not saved by article 19(5) since the same was not "a reasonable restraint" on the rights of the appellant. If Counsel was right so far, his next submission was that the threat to deprive the appellant of the amount of the tax levy was a deprivation without authority of law article 31(1) and was further a compulsory acquisition of that property without compensation (article 31(2)) which was not saved by article 31(5)(b)(i) because the 29 law contemplated by that sub article was a valid law for the imposition of a tax which satisfied the requirements both of legislative competence and of the rights guaranteed by Part III of the Constitution. The submission of Mr. Pathak on this part of the case was briefly as follows. A law which imposes a tax and provides for its levy and collection is as much a law, as a law under other non taxation entries of the legislative list. All laws including laws imposing taxes are within Part III of the Constitution being laws under article 13(2) thereof and unless any particular Article was inapplicable to such laws by reason of obvious irrelevance every Article in the Part would apply to them and without such a law satisfying the test of reasonableness or constitutionality laid down in the various Articles guaranteeing the several. Fundamental rights the statute in question could not be pronounced valid and enforceable. We shall be referring to the manner in which Mr. Pathak sought to urge that the impugned provision offended article 19(1) (f), but before doing so, it is necessary to notice the submission which Mr. Sanyal invited us to accept. He raised a broad contention that no law imposing a tax could be impugned on the ground of violation of Part III of the Constitution in general and in particular of article 19(1) (f) or article 31. His submission was that the validity of tax laws were governed solely by article 265 and that such laws were not governed by Part III of the Constitution and specially because the money sought to be taken by the State as tax by virtue of a fiscal enactment was not "property" within article 19(1) (f) and that the expression "laws for the purpose of imposing a tax" used in article 31(5) (b) (i) saved all laws from the operation of article 31 whether such laws be within legislative competence or not, as 30 also whether or not such laws were repugnant to Part III of the Constitution. Before adverting to the decisions on which reliance was placed for this position two things might he pointed out: (1) that article 265 merely enacts that all taxation the imposition, levy and collection shall be by law; and (2) that the Article beyond excluding purely executive action does not by itself lay down any criterion for determining the validity of such a law to justify any contention that the criteria laid down exclude others to be found elsewhere in the Constitution for laws in general. If by reason of article 265 every tax has to be imposed by "law" it would appear to follow that it could only be imposed by a law which is valid by conformity to the criteria laid down in the relevant Articles of the Constitution. These are that the law should be (1) within the legislative competence of the legislature being covered by the legislative entries in Schedule VII of the Constitution; (2) the law should not be prohibited by any particular provision of the Constitution such as for example, articles 276(2), 286 etc., and (3) the law or the relevant portion thereof should not be invalid under article 13 for repugnancy to those freedoms which are guaranteed by Part III of the Constitution which are relevant to the subject matter of the law. The reference therefore to article 265 does not lead necessarily to the result envisaged by Mr. Sanyal. The entire argument of Mr. Sanyal on this part of the case was rested on the observations contained in two decisions of this Court, Ramjilal vs Income tax Officer, Mohindargarh and Laxmanappa Hanumantappa Jamkhandi, vs The Union of India. We do not understand these decisions as laying down any such broad proposition. We are further 31 satisfied that the learned Judges could not have meant that if a law imposing a tax was outside the legislative competence of the legislature enacting it, as the argument before us appeared to suggest it could be a law under which a person could be deprived of his property under article 31(I) or regarding which a person could not move this Court for relief under article 32. Such a proposition would be contrary to a long catena of cases of this Court of which it is sufficient to refer to Mohammad Yasin vs The Town Area Committee, Jalalabad, State of Bombay vs The United Motors (India) Ltd., The Bengal Immunity Company Limited vs The State of Bihar and Ch. Tika Ramji vs The State of Uttar Pradesh. In all these cases the legislation imposing the tax or the fee which had been held not to have been within the legislative competence of the authority imposing the tax or the fee was struck down on the ground that those laws violated the freedom guaranteed by Part III of the Constitution. Learned Counsel laid some stress on the fact that in these cases the tax or fee was held to be unconstitutional as imposing an unreasonable restraint on the right to carry on a trade or business guaranteed by article 19(1)(g) and not as an infringement of the right to hold "property" under article 19(I)(f). In our opinion nothing turns on this, for it is the deprivation of the freedom "to hold property" that is the direct result of the tax and the restraint on the business by reason of the collection of the illegal tax or the procedures prescribed for such collection is only an indirect and incidental effect thereof. Nor do we find it possible to accept even the more limited proposition that whatever be the position in regard to tax laws which lack legislative competence, once a tax law is covered by an entry in the Legislative List and does not contravene direct prohibitions like those in articles 276 (2) or 286 32 etc. , such a law is immune from the limitations imposed by Part III of the Constitution. Mr. Sanyal is right in his submission that the levying of taxes though it might involve taking private property for a public use is entirely distinct from the power of eminent domain which is covered by article 31(1)(2) and that the saving in article 31(5)(b) (i) of such laws is really by way of abundant caution. It has been stated that where "property is taken under a taxing power, the persons so taxed may be said to be compensated for their contribution by the general benefits which they receive from the existence and operation of Government. But this is not to say that the burden of a tax that may be constitutionally laid upon an individual needs to be justified by a showing that he, individually will receive benefit from the expenditure of the proceeds of the tax, and much less that the degree of that burden may be measured by the amount of benefit that the tax payer is excepted to receive (1)". It would, therefore, be obvious that a tax law need not satisfy the tests of article 31(2). But it does not follow that every other Article of Part III is inapplicable to tax law. Leaving aside article 31(2) that the provisions of a tax law within legislative competence could be impugned as offending article 14 is exemplified by such decisions of this Court as Suraj Mal Motha vs Sri A. V. Visvanatha Sastri and Shree Meenakshi Mills Ltd., Madurai, vs Sri A. V. Visvanatha Sastri. In Moopil Nair vs State of Kerala the Kerela Land Tax Act was struck down as unconstitutional as violating the freedom guaranteed by article 14. It also goes without saying that if the imposition of the tax was discriminatory as contrary to article 15, the levy would be invalid. It might very well be that a distinction might have to be drawn between the legality of the 33 quantum of a tax levied which might not be open to challenge under article 19(1)(f) and the incidence of the tax or the procedure prescribed therein either for the assessment or the collection which might be open for being tested with reference to all the freedoms including that contained in article 19(1)(f). In fact in Moopil nair vs State of Kerala (1) already referred to, certain provisions of the Act therein challenged which prescribed the procedure for the levy of the tax were struck down on the ground of being obnoxious to article 19(1)(f). Having regard to the very limited controversy before us we do not consider it necessary to embark on any further or more detailed examination of this question, except to say that we cannot accept the argument of the learned Additional Solicitor General that by reason of article 265 tax laws are outside Part III of the Constitution. In support of the submission that a tax levied with retrospective effect was unconstitutional as being an unreasonable restriction on this right to hold property (article 19(1)(f)). Mr. Pathak relied on the decisions in Nichols vs Coolidge (2). The tax in question was an estate duty on property passing on death and in the items to be included for computing the value of the estates was included not merely all property of which the deceased died possessed, on the date of his death but also that which he had transferred by gifts within a period of two years fore his death. This inclusion of property transferred to third persons not in contemplation of death but by the grantor in the ordinary and natural course of the transaction of his affairs so that the donees might enjoy the properties absolutely, was held to be unconstitutional as offending the rule as to "due process" contained in fifth amendment to the constitution. Justice McReynolds delivering the opinion of the Court said: 34 "Under the theory advanced for the United States, the arbitrary, whimsical and burdensome character of the challenged tax is plain enough . .Real estate transferred years ago, when of small value, may be worth an enormous sum at the death. If the deceased leaves no estate there can be no tax; if, on the other hand, he leaves ten dollars both that and the real estate become liable. Different estates must bear disproportionate burdens determined by what the deceased did one or twenty years before he died. This Court has recognised that a statute purporting to tax may be so arbitrary and capricious as to amount to confiscation and offend the fifth Amendment. We must conclude that section 402(c) of the statute here under consideration, in so far as it requires that there shall be included in the gross estate the value of property transferred by a deceased prior to its passage merely because the conveyance was intended to take effect in possession or enjoyment at or after his death, is arbitrary, capricious and amounts to confiscation." Learned Counsel also referred us to a few later decisions of the American Supreme Court in which retrospective taxation has been held arbitrary and capricious and to amount to a violation of the due process clause contained in the 5th Amendment. In regard to these decisions, two points have to be noted: (1) that the decisions of Supreme Court of the United States are not uniform and there are undoubtedly decisions of the Court of a later date which speak the other way. In Third National Bank vs White (1) the Supreme Court upheld an estate tax which operated retrospectively. It is in view of these decisions that Mr. Ballard states in an article in the Harvard Law Review (*), referring to White 's case (1) 35 "It seems accurate to say that the decision marks for practical purposes the passing of 'arbitrary retroactivity ' in the field of the estate tax. . .And the present status of Nichols vs Coolidge is not entirely clear. . Since the Nichols case can be distinguished on its facts, it may well give way. . In any event. .it would seem that after the White case no application of the estate tax can be successfully resisted on the score of retroactivity. " For instance in Welch vs Henry (1) which related to an enactment imposing income tax which had retrospective operation, Justice Stone delivering the Judgment of the Court referring to Nichols vs Coolidge (2) and other cases in which observations broadly stating that any retrospective tax legislation was obnoxious to the requirement of due process, stated: "Even a retroactive gift tax has been held valid where the donor was forewarned by the statute books of the possibility of such a levy. In each case it is necessary to consider the nature of the tax and the circumstances in which it is laid before it can be said that its retroactive application is so harsh and oppressive as to transgress the constitutional limitation." "Any classification for taxation is permissible which has reasonable relation to a legitimate end of governmental action. Taxation is but the means by which government distributes the burdens of its cost among those who enjoy its benefits. And the distribution of a tax burden by placing it in part on a special class which by reason of the taxing policy of the State has escaped all tax during the taxable period is not a denial of equal protection. 36 Nor is the tax any more a denial of equal protection because retroactive. . A tax is not necessarily unconstitutional because retroactive. Milliken vs United States and cases there cited. Taxtation is neither a penalty imposed on the taxpayer not a liability he assumes by contract. It is but a way of apportioning the cast of government among those who in some measure are privileged to enjoy its benefits and must bear its burdens. Since no citizen enjoys immunity from that burden, its retroactive imposition does not necessarily infringe due process, and to challenge the present tax is not enough to point out that the taxable event, the receipt of income, antedated the statute. " In Untermyer vs Anderson (1) which was concerned with the validity of a tax on gifts which was made to operate from a date before it was enacted, Justice Holmes stated: ". . I find it hard to state to myself articulately the ground for denying the power of Congress to lay the tax. We all know that we shall get a tax bill every year. I suppose that the taxing act may be passed in the middle as lawfully as at the beginning of the year. A tax may be levied for past privileges and protection as well as for those to come," and Justice Brandeis made the added observations which have been repeatedly quoted in later decisions as well as in text books: "For more than half a century, it has been settled that a law of Congress imposing a tax may be retroactive in its operation. Each of the fifteen income tax acts adopted from time to time during the last sixty seven years has been retroactive, in that it applied 37 to income earned, prior to the passage of the act, during the calendar year. . The need of the government for revenue has hitherto been deemed a sufficient justification for making a tax measure retroactive whenever the imposition seemed consonant with justice and the conditions were not such as would ordinarily involve hardship. On this broad ground rest the cases in which a special assessment has been upheld. Liability for taxes under retroactive legislation has been 'one of the notorious incidents of social life '. . Recently this Court recognized broadly that 'a tax may be imposed in respect of past benefit '. " It would thus be seen that even under the constitution of the United States of America the unconstitutionality of a retrospective tax is rested on what has been termed "the vague contours of the 5th Amendment." Whereas under the Indian Constitution that grounds on which infraction of the rights a property is to be tested not by the flexible rule of "due process" but on the more precise criteria set out in article 19(5), mere retrospectivity in the imposition of the tax cannot per se render the Law unconstitutional on the ground of its infringing the right to hold property under article 19(1)(f) or depriving the person of property under article 31(1). If on the one hand, the tax enactment in question were beyond legislative competence of the Union or a State necessarily different considerations arise. Such unauthorised imposition would undoubtedly not be a reasonable restriction on the right to hold property beside being an unreasonable restraint on the carrying on of business, if the tax in question is one which is laid on a person in respect of his business activity. Mr. Pathak also presented his argument on this head in a slightly different form. He submitted that the Constitution makers had contemplated that a duty of excise would be imposed only when the 38 manufacturer or the producer was in possession and control of the goods at the moment of the imposition, and therefore would be in a position to pass it on and obtain payment from the purchaser of the duty paid by him to State. The imposition of the levy retrospectively however deprive him of this benefit of passing on the burden which he would normally have. This restriction or impairment of his right to pass on the duty, he urged rendered the restriction imposed on him in the shape of the obligation to pay the duty unreasonable. Learned Counsel admitted that as the imposition would yield to the Exchequer more money, the restriction on appellants ' right to hold property could not be denied to be in the 'interest of the general public" within article 19(5) but his submission was that it lacked the character of "reasonableness" because it deprived him of the right to pass on the tax to others. It was further admitted that it was only if learned Counsel was right in his submission regarding the infraction of article 19 (1) (f) that any question of the violation of article 31 (1) could arise. It would be seen that it is the same argument as was presented to challenge the legislative competence of Parliament to enact the legislation. Only the nomenclature employed is different and adapted to suit the need of bringing it into the fold of an impairment of fundamental rights under Part III of the Constitution. As Evatt, J. observed in Broken Hill South Limited (Public Officer) vs The Commissioner of Taxation (New South Wales) (1) "It is not proper to deny to the legislature the right of solving taxation problems unfettered by legal categories. " If notwithstanding that according to economic theory or doctrines propounded by economists a duty of excise does not cease to be such, merely because it is imposed at a time or in circumstances (as pointed out earlier in conjunction with a system of price control) in 39 which it cannot be passed on one fails to see any substance in the argument that the imposition of such a tax is an unreasonable restriction on the exercise of the fundamental rights to hold property guaranteed by article 19 (1) (f). The last of the points urged was that r. 10A was not apt to cover the recovery of the duty which was a subject of demand dated December 12, 1951. The learned Judges of the High Court rejected this submission and, in our opinion, correctly. Rule 10 under which the first demand of June 22, 1951, was made ran: "10. Recovery of duties or charges short levied or erroneously refunded. When duties or charges have been short levied through inadvertence, error, collusion or misconstruction on the part of an officer, or through mis statement as to the quantity, description or value of such goods on the part of the owner, or when any such duty or charge, after having been levied, has been owing to any such cause, erroneously refunded the person chargeable with the duty or charge, so short levied, or to whom such refund has been erroneously made shall pay the deficiency or repay the amount paid to him in excess, as the case may be, on written demand by the proper officer being made within three months from the date on which the duty or charge was paid or adjusted in the owners account current, if any, or from the date of making the refund. " The contention which was then urged was that the short levy which led to the demand was not caused through inadvertence, error etc., which are set out in this rule and that consequently there was a defect in the operative machinery for collection of the refund. This objection of the present appellants was upheld by the Full Bench of the 40 Nagpur High Court and it was as a result of this decision that rule 10 A was framed. This rule reads: 10A. Residuary powers for recovery of sums due to Government. Where these rules do not make any specific provision for the collection of any duty, or of any deficiency in duty if the duty has for any reason been short levied, or of any other sum of any kind payable to the Central Government under the Act or these Rules, such duty deficiency in duty or sum shall, on a written demand made by the proper officer, be paid to such person and at such time and place, as the proper officer may specify. " The words "deficiency in duty if the duty has for any reason been short levied" are in our opinion, wide enough to include cases of deficiency arising like those in the circumstances of the present case, viz., where 8 annas out of the 14 annas of the duty has been collected in the first instance but 6 annas remains to be collected. We consider, therefore, that there is no substance in the objection that r. 10A is not wide enough to cover the recovery of the duty from the appellants. The result is that these appeals fail and are dismissed with costs. There will, however, be only one hearing fee for all the cases. The writ petitions also fail and are dismissed, without any order as to cost. KAPUR J. The appellants are manufacturers, warehousemen and merchants of tobacco and they have private licensed warehouses which are governed by r. 140 of the Rules made under the Central Excise & Salt Act (Act 1 of 1944), hereinafter termed the "Act. " According to their allegations in the petition under article 226 of the Constitution, the appellants had a considerable quantity of tobacco in their licensed 41 warehouses on February 28, 1951. On the same day the Central Bill (Bill No. 13 of 1951) was introduced in the House of the People, one of the clauses of which related to the duty of excise for the financial year beginning April 1, 1951. According to the Bill, on unmanufactured tobacco a duty of 8 As. per Ib. and 6 to 9 As. (per 1000) Biris was to be imposed. This Bill was amended and by this amendment the duty on tobacco other than Biri tobacco was fixed at 6 As. per Ib. On Biri tobacco 14 As. per Ib. and no duty was imposed on manufactured Biris. As a result of the operation of sections 3 & 4 of the provisional Collection of Taxes act (Act XVI of 1931) the duty became leviable as from the date of the introduction of the Bill. The petitioner have stated that in accordance with the provisions of the Bill that was introduced, they paid excise duty on tobacco in their possession at the rates mentioned in the Bill and obtained clearance certificates in accordance with the Rules under the Act. On April 28, 1951, the Finance Bill was passed and became Finance Act, 1951 (Act XXIII of 1951). By section 7 of that Act the first schedule to the Central Excise and Salt Act was amended in accordance with what has been stated above. By section 7. (2) of the Finance Act. 1951, it was provided that the amendment made in the first schedule to the Act shall be deemed to have effect on and from the first day of March 1951. A demand was subsequently made from the appellants in respect of excess duty payable on tobacco cleared out of the store houses from March 1, 1951, to April 28, 1951. Thereupon the appellants filed a petition under article 226 of the Constitution in the High Court at Nagpur. The grounds of the attack as to the constitutionality of the tax were decided against the appellants but the petition succeeded on the ground that there was no machinery 42 provided under the Act for recovery of the tax. This judgment is reported as Chhotabhai Jethabhai Patel & Co. vs The Union of India (1). On December 8, 1951, the Central Government by a notification amended the Central Excise Rules by adding r. 10A which provided machinery for the collection of tax. The rule was : "10 A. Residuary powers for recovery of sums due to Government. Where these rules do not make any specific provision for the collection of any duty or of any deficiency in duty if the duty has for any reason been short levied, or of any other sum of any kind payable to the Central Government under the Act or these Rules, such duty, deficiency in duty or sum shall on a written demand made by the proper officer be paid to such person and at such time and place as the proper officer may specify." After the introduction of this rule a fresh demand was made on December 12, 1951, for excess duty on the tobacco cleared. The appellants again filed a petition in the High Court of Nagpur which was decided against them and against that judgment the appellants have come to this court on a certificate under article 132 of the Constitution. The question submitted to this Court is as to the validity of the said tax on the ground of its repugnancy to the Constitution of India. Counsel for the appellants has raised two questions against the legality of the taxes; (1) The Parliament had no power to make a retrospective legislation while making a law under item 84 of List I so as to affect goods that had been cleared from the warehouses after payment of proper duties at the rates prevailing on the date that the goods were cleared because (a) Parliament 's power to make retrospective laws is subject to constitutional limitations, namely, the language 43 of item 84 of List I; (b) duty of excise as defined in the Constitution and its nature and character is such that it is not capable of being exercised after the goods on which it is imposed are no longer in possession of the warehousemen and after they have passed into the common stock of the country; (2) legislation of this character imposes an unreasonable restriction under article 19 (1) (f); and (3) r. 10 A does not apply to the facts of the case and does not authorise the collection of the duty imposed. The first point relates to the legislative competency of Parliament. Item 84 of List I provides: Item 84 "Duties of excise on tobacco and other goods manufactured or produced in India. " In the corresponding item under the Government of India Act, 1935, the same language was used so that the nature of the duties remains the same both under the Constitution and under the Government of India Act, 1935 Section 3 of the Act empowers the levying of duties specified in the First Scheduled. The relevant portion of that section is as follows: Section 3(1) "There shall be levied and collected in such manner as may be prescribed duties of excise on all excisable goods other than salt which are produced or manufactured in India and a duty on salt manufactured in, or imported by land into, any part of India as, and at the rates set forth in the First Schedule." By section 7 (2) of the Act retrospective effect was given to the duties imposed by the Finance Act taking effect as and from the First day of March, 1951. section 7(2) "The amendment made in the , by sub section (1) shall be deemed to have had effect on and from the first day of March 1951. ." 44 The effect of this deeming provision is that the new rates of duties must be taken to have been imposed and become operative as if they were in the bill as and when the bill was introduced in Parliament: Venkatachalam vs Bombay Dyeing & Manufacturing Co. Ltd.(1). The contention raised is as to the nature of the duty of Excise. It was argued that Excise Duty is a tax on goods which must exist at the time when the tax is levied and it must have been intended and expected by the legislature that it will be passed on to the consumer and as retrospective operation of such duties has not got these qualities when the goods are no longer in possession of the person sought to be taxed they do not fall within the term "duty of excise" and therefore they are beyond the legislative competence of Parliament. To support his contention, counsel for the appellants relied on Bank of Toronto vs Lambe (2) where the question for decision was as to whether certain taxes imposed on commercial corporations carrying on business were direct taxes or indirect taxes of the Provinces or the Dominion. Lord Hobhouse at p. 582 relying upon the definitions given by John Stuart Mill said: "Taxes are either direct or indirect. A direct tax is one which is demanded from the very persons who it is intended or desired should pay it. Indirect taxes are those which are demanded from one person in the expectation and intention that he shall indemnify himself at the expense of another; such are the excise or customs. " The same distinction was brought out in some other Canadian cases decided by the Privy Council; City of Halifax vs Estate of J. P. Fairbanks (3) which related to the nature of "Business Tax" which was held to be a direct tax; Attorney General 45 for British Columbia vs Mc Donald Murphy Lumber Company Ltd. (1); & Attorney General for British Columbia vs Kingcome Navigation Comapny Limited (2) Attorney General for Manitoba vs Attorney General for Canada (3) and Brewers & Malster 's Association of Onatario vs The Attorney General for Ontario (4) Reference was next made to an Australian case Parton vs Milk Board (Victoria) (5) where two necessary qualities of the duty of Excise were stated to be that it must be levied on goods which are in existence and the taxpayer should be able to pass it on to the consumer. But as was pointed out by Gwyer, C.J., in the Province of Madras vs Boddu Paidanna (6): "The Canadian cases which were cited do not seem to afford any assistance since analogous problems in Canada are always concerned with direct and indirect taxation. " Dealing with the same distinction the Privy Council said in Governor General in Council vs Province of Madras (7): "Little assistance is to be derived from the consideration of other federal constitutions and of their judicial interpretations. Hence there is no question of direct and indirect taxation. " The Indian Constitution is unlike any that have been called to their Lordships ' notice in that it contains what purports to be an exhaustive enunciation and division of legislative powers between the Federal and Provincial Legislatures. " The Excise duty in England came to be imposed as a scheme of revenue and taxing device by Pym and approved by the Long Parliament. It consisted of charges on wine and tobacco and some 46 other articles were added later. The basic principle of duties of Excise was that they were taxes on the production and manufacture of articles which could not be taxed through the customs house. The revenue derived from that source is called excise revenue proper. In England it was later on extended to comprise other taxes but the fundamental conception of the term is that it is a tax on articles produced or manufactured in the country. It was in this sense that the word "duty of excise" was understood in Australia (Peterswalad vs Bartley (1). The importance of legislative practice of a country was pointed out by the Privy Council in a Canadian case Croft vs Dunphy (2) where it was held that when a power is conferred to legislate on a particular topic it is important in determining the scope of the power to have regard to what is ordinarily treated as embraced within that topic in the legislative practice in England, U.S.A. and the Dominions and of India, the Federal Court considered the nature of duty of Excise in Re The Central Provinces & Berar Sales of Motor Sprit & Lubricants Taxation Act (In re A Special Reference under section 213 of Government of India Act, 1935) (3), generally known as the "Central Provinces" case. In that case the Act of the Provincial legislature levying a tax on retail sale of motor spirit was held to fall within item 48 in List II of the 7th Schedule of the Constitution Act and not a duty of Excise within the meaning of entry 45 of List I of that Schedule. The nature of the duty was considered by the Court. Gwyer, C. J., after referring to the distionary meaning of the word "excise" said at p. 41: "But its primary and fundamental meaning in English is still that of a tax on articles produced or manufactured in the taxing country and intended for home consumption. I am satisfied that is also its primary and fundamental meaning in India; and no 47 one has suggested that it has any other meaning in entry No. 45. " At p. 47 the learned Chief Justice said: "The expression "duties of excise", taken by itself conveys no suggestion with regard to them time or place of their collection. Only the context in which the expression is used can tell us whether any reference to the time or manner of collection is to be implied. It is not denied that laws are to be found which impose duties of excise at stages subsequent to manufacture or production; but so far as I am aware, in none of the cases in which any question with regard to such a law has arisen was it necessary to consider the existence of a competing legislative power such as appears in entry No. 48." But Mr. Pathak relied on the observations of the learned Chief Justice at p. 50 where he said: "Thus the Central Legislature will have the power to impose duties on excisable articles before they become part of the general stock of the Province, that is to say at the stage of manufacture or production, and the Provincial Legislature an exclusive power to impose a tax on sales thereafter. " But these observations only mean this that when there is a competition between the duty, imposed at the stage of manufacture of production and a tax imposed on sales thereafter, the sphere of the Central and the Provincial Legislatures comes into operation but, as the previous passages, show, it does not in any manner vary the meaning of the word "excise" nor does it accept a further qualification which is sought to be included in that phrase as a necessary quality of that tax that unless it is capable of being passed on to the consumer or the person taxed can indemnify, himself, it is not a duty of excise. At p. 47, the learned Chief Justice 48 observed that in the expression "duties of excise" no suggestion as to time or place of collection was implied. Sulaiman, J., pointed out at p. 73 that in the Indian Constitution it was not necessary to go into the fine niceties of distinction between direct and indirect taxation because in the Indian Act no such division existed and that ultimate incidence of tax was not a crucial test under the Indian Constitution. Again at p. 77, Sulaiman, J., said: "The essence of a tax on goods manufactured or produced is that the right to levy it accrues by virtue of their manufacture or production. It is immaterial whether the goods are actually sold or consumed by the owner or even destroyed before they can be used. If a duty is imposed on the goods manufactured or produced when they issue from the manufactory then the duty becomes leviable independently of the purpose for which they leave it and irrespective of what happens to them later. " In a subsequent case The Province of Madras vs Messrs. Boddu Paidnna & Sons(1) Gwyer, C. J., again went into the question of the nature of the duty of excise under the expression "duties of excise" and said at p. 101: "There is in theory nothing to prevent the Central Legislature from imposing a duty of excise on a commodity as soon as it comes into existence, no matter what happens to it afterwards, whether it be sold, consumed, destroyed or given away. A taxing authority will not ordinarily impose such a duty, because it is much more convenient administratively to collect the duty (as in the case of most of the Indian Excise Acts) when the commodity leaves the factory for the first time, and also 49 because the duty is intended to be an indirect duty which the manufacturer or producer is to pass on to the ultimate consumer, which he could not do if the commodity had, for example been destroyed in the factory itself. It is the fact of manufacture which attracts the duty, even though it may be collected later; and we may draw attention to the Sugar Excise Act in which it is specially provided that the duty is payable not only in respect of sugar which is issued from the factory but also in respect of sugar which is consumed within the factory." The Privy Council described the nature of the duty of Excise in Governor General in Council vs Province of Madras (1) as a duty which is primarily levied on a manufacturer or producer in respect of the commodity manufactured or produced. At p. 103 Lord Simonds referred to In re Central Provinces & Berear case (2) and to Baddu Paidanna case (3) and said: "The two taxes, the one levied on a manufacturer in respect of his goods, the other on a vendor in respect of his sales, may as is there pointed out in one sense overlap. But in law there is no overlapping. The taxes are separate and distinct imposts. If in fact they overlap, that may be because the taxing authority, imposing a duty of excise finds it convenient to impose that duty at the moment when the excisable article leaves the factory or workshop for the first time on the occasion of its sale. But that method of collecting the tax is an accident of administration; it is not of the essence of the duty of excise, which is attracted by the manufacture itself. That this is so is clearly exemplified in those excepted cases in which the Provincial, not the Federal legislature has power to impose a duty of excise. " 50 Thus according to the Indian cases decided on the nature of duties of excise ultimate incidence is not of any importance or relevance. In dealing with excise duty (1) there is no mention of a direct or indirect taxes; the Indian Legislature has avoided this incidence to be characteristic of the tax; (2) taxable event is the manufacture or production of goods; it is immaterial what happens to them afterwards whether they are sold, consumed, destroyed or given away; (3) it is not a necessary incidence that the manufacturer must be able to pass it on to the consumer or indemnify himself; (4) the general tendency of its being passed on may be there but it may be prohibited by the circumstances, economic or otherwise. The fact that the manufacturer has no chance to get the tax from the buyer does not affect the legality of the tax; it was so held in the case of sales tax in The Tata Iron & Steel Co. Ltd. vs The State of Bihar (1) where the nature of the excise duty was discussed. At page 1369 the observations of Gwyer C. J. in Boddu Paidanna case (2) and of the Privy Council in Governor General in Council vs Province of Madras (3) were quoted with approval. It may be noted that in the Tata Iron & Steel Co. case (1) the tax was a retrospective tax and was imposed at a time when in the Sales Tax Act no provision was made for passing on the Sales Tax to the purchaser. In the Union of India vs Madan Gopal Kabra (4) it was pointed out that Parliament was not precluded from exercising the power of imposing a retrospective tax and therefore it was competent to make a law imposing a tax on the income of any year prior to the commencement of the Constitution. As was pointed out in that case under articles 245 and 346 of the Constitution read with the relevant entry in List I of Schedule VII Parliament is empowered to make laws with regard to taxes and no limitation or restriction is imposed in regard to 51 retrospective legislation. See Sargood Bros. vs The Commonwealth (1) where retrospective laws about the levying of Customs were held valid. See also Welch vs Henry (2) On the ground of retrospectivity alone therefore the tax is not unconstitutional. In view of what has been said above the cases decided in Canada or Australia cannot have any application. It was next contended that a retrospective tax purporting to be a duty on goods when the goods had been disposed of would be a tax not under item 84, List I of the Seventh Schedule but one under item 60 of List II, i.e., tax on profession, trade, calling and employment the submission being that the word "trade" would include manufacture. This contention was sought to be supported by the observations of Lords Davey in Commissioner of Taxation vs Kirk (3): "The word `trade ' no doubt primarily means traffic by way of sale or exchange or commercial dealing, but may have a larger meaning so as to include manufactures." In National Association of Local Government Officers vs Bolton Corporation (4) Lord Wrights in interpreting the word "trade" in section 11 of the Industrial Courts Act, 1919, said: "Sect. 11 of the Act of 1919 shows that `trade ' used as including `industry ' because it refers to a trade dispute in the industry of agriculture. " But this letter case has no application because there the word "trade" was interpreted in relation to a section of a particular Act and trade in that context has quite a different meaning. In Skinner vs Jack Breach Limited (5), Lord Hewart, C. J. in interpreting the word "trade" in Trade Boards Act held that the word "trade" indicates a process of buying 52 and selling but it was by no means an exhaustive definition. It might also mean a calling or industry or class of skilled labour. The duty of Excise in item 84 should be given the widest construction unless for some reason it is cut down either by the terms of that item itself or by other Parts of the Constitution. The legislative history of the duty of Excise shows the nature of the tax. The word "trade" in item 60 of List II has reference to the carrying on of an activity in the nature of buying and selling and may in a different context mean a calling or an industry. Therefore reading the two items together it is obvious that item 84 deals with taxes on goods manufactured or produced and item 60 deals with the carrying on of trade i.e., an activity in the nature of buying and selling and the Act in its pith and substance relates to duty on goods manufactured or produced and has no relationship with item 60 of List II. Even assuming that the nature and tendency of the duty of Excise is, as contended by Mr. Pathak that it can be passed on to the consumer, even than the complaint of the appellants that they have been deprived of that opportunity is not well founded, because of section 64 A of the Indian Sale of Goods Act (3 of 1930), which was section 10 in the Indian Tariff Act, 1934. It was originally taken from the British Tariff Act, 1901, 1 Edw. VII Ch. Section 64A of the Indian Sale of Goods Act is as follows : section 64 A. "In the event of any duty of customs or excise on any goods being imposed, increased, decreased or remitted after the making of any contract for the sale of such goods without stipulation as to the payment of duty where duty was not chargeable at the time of the making of the contract, or for the sale of such goods duty paid where duty was chargeable at that time, 53 (a) if such imposition or increase so takes effect that the duty or increased duty, as the case may be, or any part thereof, is paid, the seller may add so much to the contract price as will be equivalent to the amount paid in respect of such duty or increase of duty, and he shall be entitled to be paid and to sue for and recover such addition; and (b) if such decrease or remission so takes effect that the decreased duty only or no duty, as the case may be, is paid, the buyer may deduct so much from the contract price as will be equivalent to the decrease of duty or remitted duty, and he shall not be liable to pay, or be sued for or in respect of, such deduction. " This section provides for the recovery by the seller of the amount of increase in duty from the purchaser where the increase takes effect subsequent to the contract and for the right of the purchaser to recover from the seller the duty in cases where there is a similar decrease and this right exists both before the delivery is given, taken and price received or paid as the case may be : Narayanan Chettiar vs Kidar Sahib(1). Counsel for the appellants attempted to counter this submission by relying upon a judgment of the Privy Council in Prbhudas vs Ganidada (2). In that case the Government duty had not been reduced but the Buyer claimed that it had constructively been decreased because the tariff valuation had been reduced and so constructively it must be reckoned that there was a decrease in the duty on the goods sold. This contention was negatived by the Privy Council and it was held that a change of duty means a change in the rate of duty, and not a change of tariff value. Thus assuming that the contention of the appellants is correct as to the nature of the excise duty it cannot be said that in the present case the appellants were 54 deprived of the opportunity of recovering the additional duty from the purchaser and therefore the duty lost its character of being excise duty and was transformed into a different tax. This argument of the appellants is therefore without substance and must be overruled. The constitutionality of the tax and retrospective imposition of enhanced duty on tobacco was further challenged on the ground of violation of the fundamental rights of the appellants under article 19(1)(f) of the Constitution which it was submitted is not saved by cl. (5) of that article because it is not a reasonable restriction in the interest of the general public. The grounds of attack may be stated in this way : (1) that the nature of an excise duty is such that normally it is passed on to the purchaser by the manufacturer or the producer and it has that tendency and quality; (2) as the impugned duty was enhanced at a time when the appellants had cleared their goods after paying the then prevailing duty, it was not possible for them to realize the excise duty from any purchaser and (3) at the time of the clearance of the goods the appellants had paid all the taxes under the then existing law and the new liability rendered them liable to pay an illegal exaction or in the alternative to suffer the consequences of non payment which are of a drastic nature. On this basis it was submitted that the imposition was an unreasonable restriction on the fundamental rights of the appellants guaranteed under article 19(1) (f). At this stage an examination of the extent of the State 's power of taxation will be helpful. This power is one of the three governmental powers of the State; the other two being police power and power of eminent domain. The power of taxation is the legal capacity of government to impose charges upon persons or their property to raise revenue for governmental 55 purposes. A tax is neither a penalty imposed on the taxpayer nor a liability which he assumes by contract. It is but a way of apportioning the cost of government among those who in some measure are privileged to enjoy its benefits and must bear its burdens. Welch vs Henry (1), but the constitutionality of a tax does not depend upon a showing of benefits ; protection and taxation are not correlative terms. Willis Constitutional, Law, p. 224 : Tax is levied against the person and not against property. Property only serves as a basis for computing the measure of each person 's liability. Weaver on Constitutional Law, p. 513 : "The power of taxation is one so unlimited in force and so searching in extent, that the courts scarcely venture to declare that it is subject to any restrictions whatever, except such as rest in the discretion of the authority which exercises it. It reaches to every trade or occupation to every object of industry, use, or enjoyment; to every species of possession; and it imposes a burden which, in the case of failure to discharge it, may be followed by seizure and sale or confiscation of property. No attribute of sovereignty is more pervading and at no point does the power of the government affect more constantly and intimately all the relations of life than through the exactions made under it." (Cooley 's Constitutional Limitations, Vol. 2, 8th Ed.p. 987.) Chief Justice Marshall said in M 'Culloch vs Maryland (2) : "The power of taxing the people and their property is essential to the very 56 existence of government, and may be legitimately exercised on the objects to which it is applicable to the utmost extent to which the government may choose to carry it. The only security against the abuse of this power is found in the structure of the government itself." (See Willough by on the Constitution of the United States, Vol. 2 at p. 666). As the exigencies of the government cannot be limited, no limits can be prescribed to the exercise of the right of taxation. Every individual must bear a portion of public burden and that portion is determined by the legislature. According to the American Supreme Court the power of taxation is very wide and uncontrolled. In M 'Culloch vs Maryland(1) Chief Justice Marshall said : ". . . . it is unfit for the judicial department to inquire what degree of taxation is the legitimate use, and what degree may amount to the abuse of the power." See also Graves vs Schmidlapp(2) (per Chief Justice Stone). In Pacific Insurance Co. vs Soule(3) the Court said: "Congress may prescribe the basis fix the rate, and require payment as it may deem proper within the limits of the constitution it is supreme in its action. No power of supervision or control is lodged in either of the other departments of the government. " Again in Veazie Bank vs Fenno (4), it was said : "It is insisted. . that the tax in this case is excessive and so excessive as to indicate a purpose on the part of the congress to destroy the franchise of the bank, and is, therefore beyond the constitutional power of 57 congress. . . The first answer to this is that the judicial cannot prescribe to the legislative department of the Government limitations upon the exercise of its acknowledged powers. The power to tax may be exercised oppressively upon persons, but the responsibility of the legislature is not to the Courts but to the people by whom its members are elected. " In Patton vs Brady(1), the Court observed: "It is no part of the function of a Court to enquire into the reasonableness of the exercise of the power of taxation either as respects the amount or the property on which it is imposed. " In Welch vs Henry(2), at p. 94 it was observed : "The equitable distribution of the costs of government through the medium of an income tax is a delicate and difficult task. In its performance experience has shown the importance of reasonable opportunity for the legislative body, in the revision of tax laws, to distribute increased costs of government among its tax payers in the light of present need for revenue and with knowledge of the sources and amounts of the various classes of taxable income during the taxable period preceding revision. Without that opportunity accommodation of the legislative purposes to the need may be seriously obstructed if not defeated." Thus according to American view (1) the power to tax is an attribute of sovereignty; (2) tax is an rateable contribution of each individual in a State towards the amount of revenue which is essential for the existence and operation of a public governing body; (3) it being essential for the very existence of an organised State, it may be exercised on objects to the utmost extent to which the legislature may choose to carry it and (4) the needs of 58 the revenue are only known to the legislature and the court cannot enquire into the necessity of imposing a tax or the objects on which the imposition should be made or the extent of the imposition. In the very nature of things the courts are unable to go into the propriety, extent or economics of a particular tax or the policy underlying it, which must depend upon a multitude of circumstances, which can only be known to the government or the legislature. As the appellants have relied on certain American decisions where certain taxing laws operating retrospectively were tested on the touchstone of "due process of law" clause it becomes necessary to examine the extent of that doctrine. "The taxing power of Federal Government," says Prof. Willis (Constitutional Law, p. 378), "is limited by the procedural requirements of the due process clause. Notice and hearing, though not a judicial tribunal, are required where the tax is based on the value of the property. Jurisdiction, also, is a requirement for all forms of taxation, though the rules as to jurisdiction vary with the kind of tax levied." According to Willoughby, Constitution of the United States, Vol. III, p. 1875, the due process of law obliges the exercise of the taxing power to conform to the following rules : 1. That the tax shall be for a public purpose. That it shall operate uniformly upon those subject to it. That either the person or the property taxed shall be within the jurisdiction of the government levying the tax. That in the assessment and collection of the tax certain guarantees against injustice to individuals, especially in the case of specific as distinguished from ad valorem taxes, by way of notice and 59 opportunity for a hearing shall be provided. These principles of taxation are not peculiar to America but are accepted in all countries which have parliamentary democracies and govern the Indian taxation system also. In some American decisions retroactive tax laws were held to be inconsistent with due process : Nichols vs Coolidge(1); Helvering vs Helwholz(2) Blodgett vs Holden (3). But the decision in those cases rested on the ground that the tax could not reasonably be anticipated by the taxpayer at the time of the voluntary act which the statute later made the taxable event e.g., the gift by the descendent of the whole or a part of his interest in property. As was explained in Welch vs Henry(4) at p. 93 : "Since, in each of these cases, the donor might freely have chosen to give or not to give the taxation, after the choice was made of a gift which he might will have refrained from making had he anticipated the tax, was thought to be so arbitrary and oppressive as to be a denial of due process. But there are other forms of taxation whose retroactive, imposition cannot be said to be similarly offensive, because their incidence is not on the voluntary act of the taxpayer. And even a retroactive gift tax has been held valid where the donor was forewarned by the statute books of the possibility of such a levy, Milliken vs United States, 75 L. Ed. 809. . . " In that case the retroactive operation of a tax on dividends was upheld and the objection on the ground of inconvenience in being called upon, after the customary time for levy and payment of the 60 tax had passed, to bear a governmental burden of which he had no warning and which he did not anticipate was held to be unsustainable. The contention that the retroactive application of the Revenue Acts is a denial of the due process guaranteed by the Constitution has not been accepted in America as an invariable rule. Welsh vs Henry(1) and the other cases there cited. The doctrine of due process of law has received various interpretations in America which have not always been consistent. Sometimes it has favoured personal liberty and sometimes social control sometimes personal liberty as a matter of substance. Sometimes it has protected personal liberty by extending due process to matters of substance and sometimes it has protected social control by broadening the scope of police power or the power of taxation or the power of eminent domain. Willis ' Constitutional Law, p. 659. Brandeis J., in Untermyer vs Anderson(2) dealing with the presumption of validity of a taxing statute observed : "The presumption should be particularly strong where as here the objection to an act arises not from a specific limitation or prohibition on congressional power but only out of the `vague contours of the 5th Amendment prohibiting the depriving any person of liberty or property without due process of law '. Holmes J., in Adkins vs Children 's Hospital, , 800. " It was because of the varying meanings and concepts which have from time to time been attached to "due process of law" that the framers of the Indian Constitution did not adopt it in the Constitution; on the other hand they tried to give more defined boundaries to the area of fundamental rights in articles 19 and 31 which deal with rights of property 61 and in articles 19, 20, 21 and 22 which relate to protection of personal liberty and this Court rejected it in A. K. Gopalan 's case (1) and in the State of West Bengal vs Subodh Gopal Bose (2). The constitutionality of the duty of excise was challenged in the present case on the ground of violation of article 19 (1) (f) of the Constitution. he argument is that a taxing law under article 265 is as much a law as any other and therefore falls within the definition of law under article 13(3)(a), and if it contravenes any of the fundamental rights under Part III, then to the extent of the contravention it is void. Counsel relied on the second Kochuni case (3). Article 19 guarantees personal freedoms subject to certain restrictions. Its relevant portion is as follows: article 19(1)(f). "All citizens shall have the right to acquire, hold and dispose of property; article 19(5). "Nothing in sub clauses (d), (e) and (f) of the said clause shall affect the operation of any existing law in so far as it imposes or prevent the State from making any law imposing reasonable restrictions on the exercise of any of the rights conferred by the said sub clauses either in the interests of the general public or for the protection of the interests of any Scheduled Tribe. " As has already been said the power to tax is the legal capacity of the State to raise from all those subject to its authority a certain amount of revenue essential so the existence and operation of government. A tax is not a penalty but a contribution of monies for governmental purposes by 62 persons who may be residents or non residents citizens or non citizens, living persons or legal personae who are privileged to enjoy its benefits, but those are not co relative. It implies an equality of burden and regular distribution of expenses of government among the persons taxed. It is levied by authority of law equitably, uniformly or in echelons on all persons subject to it. The appellants alleged that they had sold their goods during the period when the Finance Bill was before Parliament. Variations in the rates of duties are not unexpected, it being within the power of Parliament to do so both prospectively and retrospectively. It is not suggested that such variations are unknown in legislative practice or that the legislators were not entitled to amend a money bill as introduced. If the appellants ' contention is sustained then it will mean the deprivation of Parliament of its right to choose the objects of taxation and therefore Parliament will only vary the rates of duties proposed by the Executive or the time of their effectiveness at the peril of their being declared invalid although they may be within its legislative competence and may in its opinion be necessary for the carrying out of its policies or subserve the proper governance of the country. In the Indian Constitution there is an exhaustive enunciation and distribution of legislative powers, including powers as to taxation, between the State Legislatures and Parliament. Subjects of taxation are distributed in the three Legislative Lists and areas of the respective fields of Parliament and State Legislatures as to taxes are defined. In Parts XII and XIII limitations on legislative competence of the various legislatures as to taxation are indicated and emphasis is placed on the preservation of the economic unity of 63 India. Article 265 is in Chapter XII and provides : "No tax shall be levied or collected except by authority of law," which means that all taxation has to be under a law enacted by a legislature of competent jurisdiction and subject to constitutional limitations. This Court in 1950 rejected the applicability of the doctrine of "due process of law" to Indian constitutional problems: A. K. Gopalan 's case (1); The state of West Bengal vs Subodh Gopal Bose (2). In the latter case it was also held that the Indian Constitution recognises no fundamental right to immunity from taxation and that is why presumably no constitutional protection is provided against the exercise of that power. Per Patanjali Sastri, C.J., p. 614. Das, J. (as he then was), held the power of taxation to be distinct from police power (i.e. regulatory power of the State) and the power of Eminent Domain (i.e. the power of the State of compulsory acquisition of property). Dealing with protection against taxation he said in Subodh Gopal 's case (2) at p. 652 : "Our Constitution makers evidently considered the protection against deprivation of property in exercise of police power or of the power of eminent domain by the executive to be of greater importance than the protection against deprivation of property brought about by the exercise of the power of taxation by the executive, for they found a place for the first mentioned protection in article 31 (1) and (2) set out in Part III dealing with fundamental rights while they placed the last mentioned protection in article 265 to be found in Part XII dealing with finance etc. So with regard to all the three sovereign powers we have complete protection against the executive organ of the State. " 64 Again at p. 653 he observed : "Apart from this, what I ask is, our protection against the legislature in the matter of deprivation of property by the exercise of the power of taxation ? None whatever. By exercising its power of taxation by law the State may deprive us, citizen or non citizen of almost sixteen annas in the rupee of our income." (See also p. 654). In Ramjilal vs Income Tax Officer (1) Das, J. (as he then was), observed at pp. 136 137 : "Reference has next to be made to article 265 which is in Part, XII, Chapter 1, dealing with 'Finance '. That article provides that no tax shall be levied or collected except by authority of law. There was no similar provision in the corresponding chapter of the Government of India Act, 1935. If collection of taxes amounts to deprivation of property within the meaning of article 31(1), then there was no point in making a separate provision again as has been made in article 265. It, therefore, follows that clause (1) of article 31 must be regarded as concerned with deprivation of property otherwise than by the imposition or collection of tax, for otherwise article 265 becomes wholly redundant. In the United States of America the power of taxation is regarded as distinct from the exercise of police power or eminent domain. Our Constitution evidently has also treated taxation as distinct from compulsory acquisition of property and has made independent provision giving protection against taxation save by authority of law. When Dr. Tek Chand was asked if that was not the correct position, he did not advance any cogent or convincing answer to refute the conclusion put to him. In our opinion, the protection against imposition 65 and collection of taxes save by authority of law directly comes from article 265, and is not secured by clause (1) of article 31. Article 265 not being in Chapter III of the Constitution, its protection is not a fundamental right which can be enforced by an application to this court under article 32. It is not our purpose to say that the right secured by article 265 may not be enforced. It may certainly be enforced by adopting proper proceedings. All that we wish to state is that this application in so far as it purports to be founded on article 32 read with article 31(1) to this court is misconceived and must fail. " A similar decision was given and similar language used by Mahajan, C.J., in Laxmanappa Hanumantappa vs Union of India (1) : "It was held by this Court in Ramjilal vs Income Tax Officer, Mohindergarh (2), that as there is a special provision in article 265 of the constitution that no tax shall be levied or collected except by authority of law, clause (1) of article 31 must therefore be regarded as concerned with deprivation of property otherwise than by the imposition or collection of tax, and inasmuch as right conferred by Article 265 is not a right conferred by Part III of the constitution, it could not be enforced under article 32. " Ramjilal 's case (2) was quoted with approval in Bengal Immunity Co. Ltd. vs State of Bihar (3). Thus early after the establishment of this Court opinion was expressed excluding the applicability of fundamental rights in Part III to taxing Statutes. But it is important to notice that the Article which was sought to be applied in those cases was article 31 (1) which deals with deprivation of property 66 and not article 19 which is regulatory of the rights of a citizen of personal liberty, property and avocation. It was contended that the impugned tax illegally deprives the appellants of their property and was therefore unconstitutional. In support reference was made to Suraj Mal Mohta & Co. vs A. V. Viswanatha Sastri (1) (under article 14); Shree Meenakshi Mills Ltd. vs Sri A. V. Viswanatha Sastri (2) (under article 14); Purshottam Govindji Halai vs Shree B. M. Desai, Additional Collector of Bombay (3) (under articles 14 and 21); M. Ct. Muthiah vs The Commissioner of Income tax, Madras (4) (under article 14); A. Thangal Kunju Mudaliar vs M. Venkatchalam Potti (5) (under article 14); Bidi Supply Co. vs The Union of India (6) (under article 14); Panna Lal Binjraj vs Union of India (7) (under articles 14 and 19(1)(g);) and Collector of Malabar vs Erimal Ebrahim Hajee (8). These are the cases in which the validity of taxation laws was attacked under the Articles above mentioned. In Panna Lal Binjraj vs The Union of India (7), the assault was not against the imposition or the vires of the tax but against the vires of section 5(7A) of the Indian Income tax Act which empowers the Commissioner of Income tax to transfer any case from one Income tax Officer subordinate to him to another and empowers the Central Board of Revenue to transfer any case from one Income tax officer to another. This attack was based on the contravention of articles 14 and 19(1)(g). It was held that the discretion vested in the authorities empowered to make the transfer is not discriminatory and there was no interference with the right of the citizen to carry on his trade or calling. In collector of Malabar vs Erimal Ebrahim Hajee (8) the attack against the recovery of income tax under section 46 (2) of the Income tax Act was based on articles 14, 19 and 22. There again the question for decision was not the imposition of the tax but 67 the mode of recovery and at Page 976 this ground of attack was rejected and reference was there made to the State of Punjab vs Ajaib Singh (1); Purshottam Govindji Halai vs Shree B. M. Desai, Additional Collector of Bombay (2). Another case relied upon by the appellant 's counsel was Western India Theatres vs The Cantonment Board, Poona, (3) in which the tax was imposed on cinema houses with larger seating capacity and the attack was on the ground of article 14 but that was repelled. The appellant 's counsel also referred to the Bengal Immunity Co. Ltd. vs State of Bihar (4) where the vires of the sales tax imposed on inter State transactions was attacked. The High Court in the case had held that the petition under article 226 was misconceived overlooking the fact that the contention raised was that in so far as the tax purported to act on non residents in respect of inter State sales it was ultra vires of the Constitution. p. 619, Das, C. J., observed : "It is also true that article 31 which protects citizens and non citizens alike cannot be availed of as it deals with deprivation of property otherwise than by way of levying or collecting taxes as held by this Court in Ramjilal vs Income tax Officer, Mohindergarh ; , and that, therefore the Act does not constitute an infringement of the fundamental right to property under that article. It is, however, clear from article 265 that no tax can be levied or collected except by authority of law which must mean a good and valid law. The contention of the appellant company is that the Act which authorises the assessment, levying and collection of sales tax on inter State trade contravenes and constitutes an infringement of article 286 and is, therefore, ultra vires, void and unenforceable. If, therefore, this contention be well founded, 68 the remedy by was of a writ must, on principle and authority, be available to the party aggrieved. The next case relied upon by counsel for the appellants was Kailash Nath vs State of U. P. (1) which was a case under the U. P. Sales Tax Act, the plea of the petitioners was that the goods sought to be taxed had been exported overseas and therefore not liable to sales tax. It was held that if a tax is levied without due legal authority on any trade or business then it is open to the citizen to approach this Court under article 32, since his right to carry on trade is violated or infringed by the imposition of the tax and article 19 (1)(g) "comes into play". There again the taxation law itself was not challenged on the ground of violation of any fundamental right which has reference to property, but the imposition of the tax was assailed on the ground that it was not imposeable on the transactions which had been entered into. In support of the proposition that the taxation laws are assailable under the provisions of article 19(1) State of Travancore Cochin vs Shanmuga Vilas Cashew Nut Factory (2) was relied upon. That was not a petition under article 32 or a matter under article 19(1)(f) but one under article 286(1) and the question in dispute was whether the transaction was in the course of inter State trade. Himatlal Harilal Mehta vs The State of Madhya Pradesh (3) was also a similar case. Article 19(1)(g) was applied because of the unconstitutionality of the tax under article 286(1)(a). M/s. Ram Narain Sons Ltd. vs Asst. Commissioner of Sales Tax (4) was also a case under article 286 of the Constitution and was not a matter falling under article 19(1) of the Constitution. In all these cases relied upon by counsel for the appellants the basis of attack was (1) that the 69 tax was not within the legislative competence of the legislature imposing the tax and therefore the tax was being illegally recovered from the assessee or (2) an objection was taken to the differential mode of imposition and collection and use of a more stringent procedure i.e., illegal discrimination between persons similarly situated e.g., under Taxation on Income (Investigation Commission) Act. The imposion of an illegal tax not within the legislative competence of the legislature, a colourable piece of legislature imposing a tax which is not a tax but is an imposition of a confiscatory nature, a breach of principles of natural justice or imposing an unimposeable tax have all been held to be violative of the right to carry on trade under article 19(1)(g). But they do not support the proposition that the tax if otherwise valid can be declared unconstitutional and can be subject to judicial review on the ground of being excessive or being retrospective in operation or being imposed on one article rather than another. These cases do not support the proposition which has been contended for by the appellants that the very imposition of the tax is a contravention of the right of the assessee to acquire, hold (or own) or dispose of property or on the ground of contravention of article 31. In the State of Bombay vs Bhanji Munji (1), it was also held that article 19(1)(f) read with cl. (5) postulates the existence of the property which can be enjoyed and over which rights can be exercised because otherwise the reasonable restriction contemplated by cl.(5) cannot be brought into play. That was the uniform view held in this Court till the majority judgment in Moopil Nair 's case(2) which relied on the second Kochuni case i.e., Kavalappara Kottarathil Kochunni etc. vs The State of Madras (3). But the latter was not a taxation case. It was held in that case (Kochuni case) that all laws within 70 article 13 are subject to Part III and that for a law to be valid it must satisfy two tests (1) of being enacted by a legislature having legislative competence and (2) it should not contravene any of the fundamental rights. The above opinion is not in accord with the opinion of this court in A. K. Gopalan 's case (1); Ram Singh vs State of Delhi (2); State of Bombay vs Bhanji Munji (3); The Daily Express case (4) and The Hamdard Dawakhana case (5). The question of the applicability of article 19(1)(f) of the Constitution to taxing matters was considered in K. T. Moopil Nair vs The State of Kerala (6). That was a case in which a tax at a flat rate was levied on forest lands in the State of Kerala and this Court by majority held that the tax so imposed was unconstitutional on the ground of infringement of articles 14 and 19(1)(f). The reasons given by the learned Chief Justice were: (a) In the procedure to be adopted for the levying of the tax, there was no provision for a notice to be given to the assessee; (b) There was no procedure for rectification of mistakes committed by the assessing authorities; (c) There is no procedure for obtaining the opinion of a superior Civil Court on a question of law as is generally found in all taxing stautes (d) No duty was cast upon the assessing authority to act judicially; and (e) There was no right of appeal provided to the assessee. The provisions of the Act were held in the majority judgment to be confiscatory. It was observed by the learned Chief Justice at p. 559: "That the provisions aforesaid of the impugned Act are in their effect confiscatory is clear on their face. Taking the extreme 71 case, the facts of which we have stated in the early part of this judgment, it can be illustrated that the provisions of the Act, without proposing to acquire the privately owned forests in the State of Kerala after satisfying the conditions laid down in article 31 of the Constitution, have the effect of eliminating the private owners through the machinery of the Act." Thus the impugned statute in that case was held to be violative of article 19(1)(f) because its procedural part made no provision for giving a hearing to the assessees or for appeal nor was the Assessing Authority required to act judicially and the imposition though called a tax was in effect confiscatory and therefore a colourable piece of legislation. Sarkar, J., in his minority judgment remarked that reasonableness of the rate was not assailed but what was assailed was the imposition of a flat rate per acre without any reference to productivity. Undoubtedly Moopil Nair 's case (1) did hold that a law under article 265 was also a law within article 13 and if it contravened article 14, it was liable to be struck down and that such law must also pass the test of the limitations prescribed in Part III of the Constitution but it did not lay down that all Articles in Part III would be applicable to taxation laws nor did it decide contrary to Ramjilal 's case (2) that article 31 (1) would apply to taxation law which is otherwise invalid. But it is difficult to hold that a regulatory Article like article 19(1) was intended to limit the powers of the Legislature to impose taxes and thus to discharge its duty in regard to country 's financial needs and policies. The contention of infringement of the appellants ' right under article 19(1) (f) is unsound and must be rejected and the reasons are these: Firstly: Clause (5) of article 19 allows the enacting of laws which impose "reasonable restrictions" 72 in the interests of the general public. The use of the term "reasonable restrictions" is indicative of regulation of the right to the personal rights mentioned in sub cl. (f) of the first clause. It must have relation to the existence of the thing to be regulated. There can be no regulation of things not in existence. Therefore where an Act is deprivatory as the imposition of a tax is it cannot fall within article (19)(1) but under the specific article 31, which relates to deprivation of property. Imam, J., in The Collector of Malabar vs E. Ebrahim Hajee (1) said at p. 976: "If the property itself is taken lawfully under article 31, the right to hold or dispose of it perishes with it and article 19(1)(f) cannot be invoked. " That was a case where the Income tax Officer issued a certificate under section 46 (2) of the Income tax Act and the Collector proceeded to recover under section 48 of Madras Revenue Recovery Act. Secondly: All taxation, as shown by its very nature and object, is in the interest of the general public because it is a contribution for governmental expenditure from all persons who in some measure are entitled to its benefit. Thirdly: There is no means or measure for determining the reasonableness of the restrictions which is an objective determination. The needs of the revenue cannot be known to the courts and cannot be determined by them, and the sources of revenue are entirely within the knowledge of the legislature and it is for that department of the State to determine how the burden will be distributed and why, because that department is the policy making body and is familiar with the economics and the resources of the country and its needs. It is for that department in its discretion to select 73 anything for taxation or to exclude it. Cooley 's Constitutional Limitations, Vol. II, p. 986 (note). Fourthly: The power to tax is an attribute of sovereignty and it is an accepted principle that the exercise of that power is not subject to judicial control because no Constitutional Government can exist without the power to raise money for its needs and the only security against abuse is in the structure of the Government. That power carries with it the power to determine when and how the tax shall be levied. section Ananthakrishnan vs The State of Madras (1), M 'Culloch vs The State of Maryland (2). There is no indication that the Indian Constitution has rejected or modified the American concept of the sovereignty of the State in regard to the power of taxation. Fifthly: Article 19 (1) declares the right of a citizen and cl. (5) prescribes its limits. If a taxation statute is within article 19(1)(f) it must be capable of being upheld as a reasonable restriction on the holding of property etc. On the submission of the appellants all taxes will be restrictions. If they are restrictions then their reasonableness will be justiciable depending upon the appreciation of established facts. How are the courts to judge ? All the necessary data for determining reasonableness can never be before a court which in the very nature of things is available only to the legislature. Can the court say that a particular tax is excessive or unreasonable or can the court say which particular source should be taxed and which particular income group should bear the burden of taxation or what the policy of the State as to taxation should be. It would seem therefore that the reasonableness of tax laws is not justiciable and therefore they cannot fall within clause (5) of article 19. Article 74 19(1)(f) and cl. 5 are part of one scheme and the former is incapable of operating where the latter is inoperative. If considerations of article 19(5) are foreign to taxing laws article 19(1)(f) can have no application to them. Sixthly: Applicability of article 19(1)(f) to taxation laws will mean that laws which are otherwise valid will be inapplicable to citizens but will be applicable to non citizens. At any rate such law will operate differentially between one set of taxpayers and another i.e., between citizens and non citizens. This will violate the very principles of due process relied upon by the appellants. Seventhly: In American due process which has a variable concept has not been applied to retrospective operation of tax laws except to tax on voluntary gifts of property and that also was doubted in Welch vs Henry (1). Eighthly: Retroactive duty of excise will be a valid imposition in the case of persons who have not sold their tobacco between the period of the introduction of the bill and the enactment of the Finance Act but will be invalid in the case of persons placed as the appellants. Ninthly: The acceptance of the appellants ' argument would mean that they can recover any excess duty paid, excess because of subsequent decrease, but would not be liable to pay any similar increase in duty in spite of section 64 A of the Indian Sale of Goods Act under which variations in the rates of duties become operative on contracts of sale and purchase. Tenthly: It has been held that article 31 is inapplicable to deprivation by taxation. Ramjilal 's case (2); Lakshmanppa Hanumantappa vs The Union of India (3); and taxation laws are expressly excluded from the operation of article 31(2) by 75 cl. 5(b)(i) of that Article. If the appellants ' contention is correct then deprivation although not protected under article 31 will be subject to regulatory control under article 19(1)(f). Eleventhly: To put it in the words of the American Supreme Court in Odgen vs Saunders(1) "It is but a decent respect due to the wisdom the integrity and the patriotism of the legislative body, by which law is passed to presume in favour of its validity, until its violation of the Constitution is proved beyond all reasonable doubt". Twelfthly: The challenge to the legality of the tax in dispute is not based and is unsustainable on the ground of specific limitation or prohibition on Parliamentary power but has been raised on the ground of the infringement of an article containing the principles of the State 's power of control. The cases dealing with legislative incapacity are inapplicable to the latter ground of assault. Cases such as Mohammad Yasin vs The Town Area Committee, Jalalabad(2) (a case of a licence fee which is not a tax), The State of Bombay vs United Motors India Ltd.(3)(a case of inter State trade) and Bengal Immunity Co. case (4) (which was also a case of inter State trade and some of the provision of the impugned Act there were held to be unreasonable restriction on the right to carry on trade) and Ch. Tika Ramji 's case (5) (a case dealing with the imposition of the restriction on the right to purchase except through a particular society) were not cases in which the imposition of a tax was challenged on the ground of infringement of article 19(1)(f). I, therefore, agree that appeals be dismissed with costs. One hearing fee. Appeal dismissed.

The appellants who were carrying on business in tobacco had in their licenced warehouse considerable quantity of tobacco on February 28, 1951. On the same day a Bill was introduced in the House of the People containing the financial proposals of the Government of India for the fiscal year beginning April 1, 1951. Clause 7 of the Bill made provision for the amendment of the , by way of alteration of duties, inter alia, on unmanufactured tobacco by imposing an excise duty of 8 annas per 1b. Under the provisions of the , the duty could become leviable as from the date of the introduction of the Bill and it was so made. In accordance therewith the appellants paid excise duty on tobacco in their possession at the rates mentioned in the Bill and obtained clearance certificates. On April 28, 1951, the Bill was passed and became Finance Act, 1951, but as passed changes were effected as regards the duty proposed in the Bill. Under section 7(1) of the Finance Act, the duty on unmanufactured tobacco was increased to 14 annas per lb. Section 7 (2) thereof provided that "the amendments made in the , shall be deemed to have effect on and after March 1, 1951 and accordingly. . recoveries shall be made of all duties which have not been collected but which would have been collected if the amendment had so come into force. " In pursuance of section 7(2) a demand was made upon the appellants on June 22, 1951, for payment of the excess of the 2 excise duty payable on tobacco cleared out of the warehouse from March 1, 1951, to April 28, 1951. The appellants challenged the legality of the demand on the grounds, inter alia, that (1) excise duty was a tax on goods which must exist at the time when the tax was levied and it must have been intended and expected by the legislature that it would be passed on to the consumer, and as the retrospective operation of the duties deprived the tax of these qualities they did not fall within the term "duties of excise" in Entry 84, List I of the Seventh Schedule to the Constitution of India, and, therefore, section 7(2) of the Finance Act, 1951, in so far as it imposed an excise duty retrospective before the date of its enactment was beyond the legislative competence of Parliament and (2) the impugned levy contravened article 19(1)(f), because a retrospective levy of an excise duty deprived the tax payer of the right of passing it on and recovering it from his buyer, and that this constituted a restraint on the right to hold property, which was not saved by cl.(5) of article 19. ^ HELD: (1) Parliament acting within its own legislative field had the powers of a sovereign legislature and could make a law prospectively as well retrospectively and the duties leviable under the , as provided by section 7(2) of the Finance Act, 1951, notwithstanding their imposition with retrospective effect and even if it be that they were incapable of being passed on to a buyer from the taxpayer, were "duties of excise" within the meaning of Entry 84, List I of the Seventh Schedule to the Constitution of India. (2) The levy of the tax retrospectively under section 7(2) of the Finance Act, 1951, was valid and did not contravene article 19(1)(f) of the Constitution. Per Kapur, J. (1) Entry 84 in List I deals with taxes on goods manufactured or produced, while Entry 60 in List II deals with the carrying on of trade i.e., an activity in the nature of buying and selling, and the , in its pith and substance relates to duty on goods manufactured or produced and has no relationship with Entry 60. (2) Reasonableness of tax laws is not justiciable and therefore they cannot fall within cl.(5) of article 19. article 19(1)(f) and the cl.(5) are part of one scheme and the former is incapable of operating where the latter is inoperative. If considerations of article 19(5) are foreign to taxing laws article 19(1)(f) can have no application to them. Case law reviewed.

ION: Criminal Appeals Nos. 75 and 77 of 1961. Appeal by special leave from the judgment and order dated December 22 23, 1960, and from the order dated March 17, 1961 of the Calcutta High Court in Cr. Revision Nos. 1019 and 681 of 1959. C.K. Daphtary, Solicitor General of India, and I. N. Shroff, for the appellant (in Cr. A. No. 75/61). Purushottam Trikamdas, Prasunchandra Ghosh, S.C. Mitter and I. N. Shroff, for the appellant (in Cr. A. No. 77 of 1961). M. C. Setalvad, Attorney General of India, Alak Gupta, S.N. Andley, Rameshwar Nath and P.L. Vohra for the respondents. December 21. The judgment was delivered by S.K. Das, J. I regret that I have come to a conclusion different from that of my learned brethren in these appeals. I proceed now to state the necessary facts, the arguments advanced before us and my conclusions on the various questions urged. By an order dated April 10, 1961 this Court granted special leave asked for by the two appellants herein, Pramatha Nath Talukdar and Saurindra Mohan Basu, to appeal to this Court from two orders made by the High Court of Calcutta, one dated December 22/23, 1960 and the other dated March 17, 1961. By the first order a Special 301 Bench of the Calcutta High Court dismissed two applications in revision which the appellants had made to the said High Court against an order of the Chief Presidency Magistrate of Calcutta dated April 11, 1959 by which the said Magistrate issued processes against the two appellants for offences alleged to have been committed by them under sections 467 and 471 read with section 109 of the Indian penal Code on a complaint made by Saroj Ranjan Sarkar, respondent herein. By the second order a Division Bench of the said High Court refused the prayer of the appellants for a certificate under article 134(1)(c) of the Constitution of India that the case was a fit one for appeal to this Court. This refusal was based primarily on the ground that the order sought to be appealed from was not a final order within the meaning of the Article aforesaid. In pursuance of the special leave granted by this Court four appeals were filed, two against the order dated December 22/23, 1960 and the other two against the order dated March 17, 1961. The two appeals numbered 76 and 78 of 1961 from the order dated March 17, 1961 were withdrawn on the ground that special leave having been granted against the order of the Special Bench dated December 22/23, 1960, the appellants did not wish to press the appeals from the later order dated March, 17, 1961. Therefore, the present judgment relates to the two appeals numbered 75 and 77 of 1961 which are from the judgment and order of the Special Bench dated December 22/23, 1960. The principal question which arises for decision in these two appeals is whether a second complaint can be entertained by a Magistrate who or whose predecessor had, on the same or similar allegation, dismissed a previous complaint, and if so in what circumstances should such a second complaint be entertained. The question is one of 302 general importance and has given rise to some divergence of opinion in the High Courts. Let me first state the facts which have led to the filing of the second complaint in the present case. Saroj Ranjan Sarkar, who is the youngest brother of the late Nalini Ranjan Sakar a well known public man, financier and industrialist of Bengal filed a petition of complaint in the court of the Chief Presidency Magistrate, Calcutta. On April 3, 1959, I do not pause here to state the allegations made in that petition, a shall have occasion to refer to them in detail later on. The complaint was filed against four persons the appellants herein and two other persons, Narendra Nath Law and Amiya Chakravarty. A previous complaint on more or less the same allegations was made by Promode Ranjan Sarkar, second brother of the late Nalini Ranjan Sarkar. That complaint was made on March 17, 1954 and was dismissed under section 203 of the Code of Criminal Procedure by the then Chief Presidency Magistrate, Shri N. C. Chakravarti, on August 6, 1954. Thereafter, an application in revision was made by Promode Ranjan Sarkar to the High Court of Calcutta, which gave rise to Revision Case No. 1059 of 1954. This application in revision was dismissed on July 8, 1955 by Debabrata Mookerjee, J. Promode Ranjan Sarkar then applied for a certificate under article 134(1)(c) of the Constitution, but such a certificate was refused by a Bench of the Calcutta High Court on September 1, 1955. Promode Ranjan Sarkar applied for special leave from this Court and obtained such leave on February 13, 1956. An appeal was filed in pursuance of that special leave, but ultimately Promode Ranjan Sarkar withdrew his appeal by filing a petition on February 3, 1959. In that petition he stated that at the intervention of Common friends and well wishers of the parties, he had settled his disputes with the respondents therein and did not want to proceed with the appeal 303 The appeal was accordingly withdrawn on March 12, 1959. Then, within about 22 days of that order, Saroj Ranjan Sarkar filed the complaint which has given rise to the present proceedings. For convenience and brevity, I shall refer to Promode Ranjan Sarkar 's complaint as the first complaint and Saroj Ranjan Sarkar 's as the second complaint. It is necessary here to give a little more of the background history of the second complaint. As stated earlier, the late Nalini Ranjan Sarkar was a well known person in Bengal. He was the Governing or Managing Director of N. R. Sarkar & Co. Ltd., which managed several public limited companies, such as, Hindustan Development Corporation Ltd., Hindustan Heavy Chemicals Ltd., and Hindusthan Pilkington Glass Works Ltd. He was also closely connected with the Hindusthan Co operative Insurance Society Ltd., of which he held a large number of shares. On January 4, 1948 he obtained leave of absence from the Directors of N. R. Sarkar & Co. Ltd. for a period of one year with a view to joining the Ministry in West Bengal and he assumed office as Finance Minister of the West Bengal Government on January 23, 1948. Later, the leave granted to him for one year was extended. He owned 4649 shares of N. R. Sarkar & Co. Ltd. Pramatha Nath Talukdar, who was a paid employee of the Hindusthan Co operative Insurance Society Ltd. up to the end of July, 1953 was also a Director of N. R. Sarkar & Co. Ltd. He held 299 shares of the said company. Promode Rajan Sarkar held 50 shares. Santi Ranjan Sarkar; son of a deceased brother of Nalini Ranjan Sarkar, held one share. Thus, it would appear that Nalini Ranjan Sarkar was the owner of the largest number of shares of N. R. Sarkar & Co., Ltd., and for all practical purposes he controlled the affairs of that company. On July 31, 1951 Nalini Ranjan Sarkar executed a deed of trust in respect of 3649 shares out of the 304 shares held by him in N. R. Sarkar & Co. Ltd. By the said trust deed he appointed Promode Ranjan Sarkar, Pramatha Nath Talukdar and Narendra Nath Law as the trustees; but the beneficiaries under the trust deed were his four brothers, namely, Promode Ranjan Sarkar, Pabitra Ranjan Sarkar, Prafulla Ranjan Sarkar and Saroj Ranjan Sarkar, as also Santi Ranjan Sarkar, the son of a deceased brother. It was alleged that the balance of 1000 shares held by Nalini Ranjan Sarkar was kept in custody with Pramatha Nath Talukdar and according to the case of the complainant these shares were kept in deposit with Pramatha Nath Talukdar for the benefit of the complainant and this brothers. Nalini Ranjan Sarkar died on January 25, 1953. It was alleged that a few days after the funeral ceremony had been performed, Saurindra Mohan Basu casually informed Promode Ranjan Sarkar that his brother Nalini Ranjan Sarkar had executed two documents to wit, an unregistered deed of agreement dated January 19, 1948 by which Pramatha Nath Talukdar was appointed Managing Director of N.R. Sarkar & Co. Ltd. and a deed of transfer of 1000 shares dated February 5, 1951 in favour of Pramatha Nath Talukdar. Promode Ranjan Sarkar and his brothers did not give credence to the information conveyed, and wanted to see the documents. It was alleged that this request was not complied with. On July 31, 1953, i.e. about six months after the death of Nalini Ranjan Sarkar Pramatha Nath Talukdar resigned from his salaried post under the Hindusthan Co operative Insurance Society Ltd. and sought to assume control of N. R. Sarkar & Co. Ltd. as its Managing Director. This led to some trouble between Promode Ranjan Sarkar and the appellants and also to some correspondence between Promode Ranjan Sarkar on one side and N. R. Sarkar & Co. Ltd. on the other, details whereof are not necessary for our purpose. 305 On September 22, 1953 a meeting of the Board of Directors of N.R. Sarkar & Co. Ltd. was held. It was alleged that the meeting was held irregularly without any agenda and a resolution was adopted, despite Promode Ranjan Sarkar 's protest, by which the appointment of Pramatha Nath Talukdar as Managing Director of N. R. Sarkar & Co. Ltd. was renewed for seven years. In September, 1953 Promode Ranjan Sarkar formally wrote to N.R. Sarkar & Co. Ltd. for inspection of the alleged deeds of agreement and transfer. On October 1, 1953 an inspection was taken, and on October 13, 1953 Promode Ranjan Sarkar was allowed to take photographs of the relevant portions of the documents. On this occasion Promode Ranjan Sarkar also inspected the minutes of the proceedings of N. R. Sarkar & Co. Ltd. and it was alleged that the proceedings dated January 16, 1948 purporting to bear the signature of Nalini Ranjan Sarkar were forged. The main allegations in the first and second complaints related to three documents and were to the effect "that in order to assume complete control over N. R. Sarkar & Co. Ltd. and the concerns under its managing agency, the accused persons entered into a criminal conspiracy with one another and others unknown, to dishonestly and fraudulently forge a deed of agreement, a deed of transfer and make a false document, to wit, minute book of N. R. Sarkar & Co. Ltd. and in pursuance thereof dishonestly and fraudulently forged and or caused to be forged and used as genuine the said documents". It will be noticed that three documents were stated to have been forged, and they were (1) An unregistered deed of agreement purporting to have been executed by the late Nalini Ranjan Sarkar as Governing Director of N. R. Sarkar & Co. Ltd. on January 19, 1948 appointing Pramatha Nath Talukdar as the Managing Director of N. R. Sarkar & Co. Ltd. on a remuneration of Rs. 1500 100 2000 per month. This document bore 306 the signature of Saurindra Mohan Basu as a witness attesting the signature of Nalini Ranjan Sarkar, which signature was stated to have been forged. (2) A transfer deed in respect of 1000 shares of N. R. Sarkar & Co. Ltd. which were said to have been entrusted to Pramatha Nath Talukdar, transfering them to the latter for and alleged consideration of rupees one lac purporting to have been executed by the late Nalini Ranjan Sarkar on February 5, 1951 with Saurindra Mohan Basu as the attesting witness both for the transferor and the transferee. (3) Minutes of the proceedings of the Board meeting of N.R. Sarkar & Co. Ltd. dated January 16, 1948 purporting to bear the signature of the late Nalini Ranjan Sarkar and containing a resolution to the effect that the Governing Director approved of a draft agreement of appointment between the Company and Pramatha Nath Talukdar for appointing the latter as Managing Director of the Company and that the Board of Directors approved of the said draft agreement. Of the aforesaid three documents the one relating to the alleged transfer of 1000 shares referred to as (2) above, is the subject of a separate suit stated to be now pending in the Calcutta High Court. That document is not, therefore, directly the subject matter of the second complaint. As to the unregistered deed of agreement referred to as (1) above, it may be stated that the original document could not be later found, and on behalf of the appellants and other accused persons it was stated that the document was not in their possession or control. As stated earlier, Promode Ranjan Sarkar had obtained a photostatic copy of the relevant portions of the document. As to this document the main allegation of the complainant was that it was engrossed on a rupee stamp paper which had been issued, on renewal, in the name of P.D. Himatsinghka & Co., a firm of solicitors in Calcutta 307 and evidence was led at the enquiry into the first complaint that the paper was stolen from that firm and furthermore that the signature on the document purporting to be that of Nalini Ranjan Sarkar was not his signature at all. With regard to the minutes of the proceedings dated January 16, 1948 the allegation was that the minutes were typed on a sheet of paper bearing the letter head N.R. Sarkar & Co. Ltd. with telephone number "City 6091" printed thereon; but the City Exchange did not come into existence until December, 1948 and the telephone connection relating to number "City 6091" was obtained for the first time by the Hindusthan Co operative Insurance Society Ltd. on or about March 18, 1949; and therefore the paper with the letter head N. R. Sarkar & Co. Ltd. with telephone number "City 6091" printed thereon could not have been in existence on the alleged date of the proceeding of the Board of Directors, namely January 16, 1948. In the second complaint certain other circumstances were also alleged in support of the allegation that the unregistered deed of agreement dated January 19, 1948 and the minutes of the proceedings dated January, 16, 1948 were forged. It is, however, unnecessary to refer to those circumstances in detail here. The learned Chief Presidency Magistrate, Shri Bijayesh Mukherjee, who dealt with the second complaint considered all the relevant materials and came to the following conclusions: (1) there was no delay in making the second complaint, if one had regard to the circumstances which led to the first complaint and the withdrawal of the appeal in the Supreme Court on March 12, 1959 arising out of the order made on the first complaint; (2) the dismissal of the first complaint and the application in revision arising therefrom by Debabrata Mookerjee, J. did not, as a matter of law, 308 operate as a bar to the entertainment of the second complaint. (3) the second complaint was not an attempt at blackmail; and (4) the relevant materials in the record showed prima facie that the minutes of the proceedings dated January 16, 1948 were forged and so also the unregistered deed of agreement dated January, 19, 1948. The learned Chief Presidency Magistrate then said: "Prima facie, I am satisfied about the truth of the allegations the complaint makes. That apart, the complaint is for an offence triable by a Court of sessions. And the materials I see before me are such as in my opinion may lead a reasonable body of men to believe the truth thereof. Judged so, there is in my opinion sufficient ground for proceeding within the meaning of section 204 of the procedure Code. On the question as to which of the four accused persons against whom process should issue, the learned Chief Presidency Magistrate came to the conclusion that there was a prima facie case against two of the accused persons only, namely, Pramatha Nath Talukdar and Saurindra Mohan Basu. Saurindra Mohan Basu, it may be stated here, was a solicitor of N.R. Sarkar & Co. Ltd. and had attested the signature of Nalini Ranjan Sarkar on the unregistered deed of agreement. The learned Chief Presidency Magistrate held that there was no sufficient ground for proceedings against the other two accused persons, namely, Narendra Nath Law and Amiya Chakravarty. Against the aforesaid order of the Chief Presidency Magistrate two applications in revision were filed by the appellants herein. These applications 309 in revision were first heard by a division Bench of two Judges of the Calcutta High Court, P. B. Mukherjee and H. K. Bose, JJ. In view of the importance of the questions raised in the two applications in revision and some earlier decisions of the Calcutta High Court bearing on those questions to which I shall presently refer, P.B. Mukherjee, J. came to the conclusion that the applications should be referred to a larger Bench to be constituted by the Chief Justice under the rules of the Court. H.K. Bose. J. (as he then was) was inclined to take the view that the applications in revision must fail, but in deference to the views expressed by P.B. Mukherjee, J. agreed that the applications should be referred to the Chief Justice for constituting a larger Bench. The matter was then referred to the learned Chief Justice, who constituted a Special Bench of three Judges to hear the two applications in revision. This Special Bench heard the two applications in revision and dismissed them by its order dated December 22/23, 1960. Three questions were agitated before the Special Bench. The first was whether the Special Bench was lawfully in seizin of the case and was competent to deal with the applications in revision. The second was whether the learned Chief Presidency Magistrate had jurisdiction to take cognizance of the offences alleged, in the absence of a sanction under section 196A of the Code of Criminal Procedure. The third and the principal question was whether it was open to the learned Chief Presidency Magistrate to entertain a second complaint on the same allegations when his predecessor had dismissed the first complaint; and if it was open to him to entertain the second complaint should he have entertained it in the circumstances of the present case ? The Special Bench unanimously decided these three questions against the appellants and further came to the conclusion that there was no undue delay in making the second 310 complaint; neither was it frivolous nor made in bad faith. It further expressed the view that it saw no reasons to differ from the finding of the learned Chief Presidency Magistrate that there was a prima facie case against the two appellants. Now, as to the first question. Chapter II of Rules of the High Court at Calcutta (Appellate Side) deals with the constitution and powers of the Benches of the Court. Rule 1 of the said chapter says in effect that a Division Bench for the hearing of appeals from decrees or orders of the Subordinate Civil Courts shall consist of two or more Judges as the Chief Justice may think fit; there is a proviso [proviso (ii)] to the rule which says that on the requisition of any Division Bench, or whenever he thinks fit, the Chief Justice may appoint a special Division Bench to consist of three or more Judges for the hearing of any particular appeal, or any particular question of law arising in an appeal, or of the any other matter. It is clear that the rule and the proviso deal with the hearing of appeals from decrees or orders of the Subordinate Civil Courts; in other words, they deal with civil matters. Rule 9 of the same chapter deals with criminal matter and sub r. (1) of the said rule says that a Division Bench for the hearing of cases on appeal, reference, or revision in respect of the sentence or order of any Criminal Court shall consist of two or more Judges. There is no proviso to this rule similar to the proviso to r. 1, referred to earlier, and the argument is that in the absence of such a proviso it was not open to the Division Bench consisting of Mukherjee and Bose, JJ. to refer the case back to the Chief Justice for the constitution of a larger Bench (though it was open to the Chief Justice to constitute originally a Division Bench of three Judges to hear the case), and if the Judges were equally divided in opinion, section 429 of the Code of Criminal procedure would apply and the case had to be laid before another Judge and judgment given according to the 311 opinion of the third Judge. I am unable to accept this argument as correct. It is clear from the rules in Chapter II that the constitution of Benches is a matter for the Chief Justice and r. 13 in Chapter II says that a Full Bench appointed for any of the purposes mentioned in Chapter VII, rr. 1 to 5, shall consist of five Judges or three Judges as the Chief Justice may appoint. Now, r. 1 in Ch. VII says inter alia that whenever one Division Bench shall differ from any other Division Bench upon a point of law or usage having the force of law, the case shall be referred for decision by a Full Bench and r. 5 says that if any such question arises in any case coming before a Division Bench as Court of Criminal Appeal, Reference or Revision, the Court referring the case shall state the point or points on which they differ from the decision of a former Division Bench, and shall refer the case to a Full Bench, for such orders as to such Bench seem fit. In his judgment P.B. Mukherjee, J. referred to two earlier decisions of the Calcutta High Court, Nilratan Sen vs Jogesh Chandra Bhattacharia(1) and Kamal Chandra Pal vs Gourchand Adhikary (2) and observed that the question as to whether those decisions were good law arose in the case and he gave that as a reason for referring the case to the Chief Justice for the constitution of a larger Bench. Even if rr. 1 and 5 in Chapter VII may not, strictly speaking, apply to the present case because the Division Bench consisting of Mukerjee and Bose JJ. did not formulate the point or points on which they differed from the earlier Division Bench decisions referred to by Mukherjee, J., I think that the principle of those rules would apply and it was open to the Chief Justice, on a reference by the Division Bench, to constitute a larger Bench to consider the case. I am also in agreement with the view expressed by the Special Bench that the absence of a proviso to r. 9 in Chapter II correspon 312 ding to the proviso to r. I does not take away the inherent power of the Chief Justice to refer any matter to Bench of three Judges. Sub rule(1) of r. 9 itself provides that a Division Bench for the hearing of cases on appeal, reference, or revision in respect of the sentence or order of any Criminal Court shall consist of two or more Judges. Therefore, it was open to the Chief Justice to constituted Bench of three Judges for the hearing of the case and in my view it made no difference whether he constituted such a Bench originally or on a reference back by the Division Bench. I further think that the Chief Justice must have the inherent power to constitute a larger Bench in special circumstances. Take, for instance, a case where one Judge of the Division Bench feels, for a sufficient and good reason, that he should not hear the case. It is obvious that in such a case the matter must be referred back to the Chief Justice for the constitution of another Bench. The Chief Justice, I think, must possess such an inherent power in the matter of constitution of Benches and in the exercise thereof he can surely constitute a larger Bench in a case of importance where the Division Bench hearing it considers that a question of the correctness or Otherwise of earlier Division Bench decisions of the same Court will fall for consideration in the case. Section 229 of the Code of Criminal Procedure does not apply to such a case because it is not a case where the Judges composing the Court are equally divided in opinion. Rather it is a case where the Judges composing the Division Bench consider that the case is one of such importance that it should be heard by a larger Bench. My conclusion, therefore, is that there was nothing illegal in the Division Bench consisting of Mukherjee and Bose. referring the case back to the Chief Justice; nor was there anything illegal in the Chief Justice constituting a special Bench of 313 three Judges to hear the applications in revision. The special Bench constituted by the Chief Justice was lawfully in seizin of the case and was competent to deal with it. The objection as to the jurisdiction of the special Bench to hear the case was, in my opinion, rightly overruled by it. Now, as to section. Section 196A of the Code of Criminal Procedure may be read first. That section is in these terms: "196A. No Court shall take cognizance of the offence of criminal conspiracy punishable under section 120B of the Indian Penal Code. (1) in a case where the object of the conspiracy is to commit either an illegal act other than an offence, or a legal act by illegal means, or an offence to which the provisions of section 196 apply, unless authority from the "State Govern upon complaint made by order or under authority from the "State Government" or some officer empowered by the "State Government" in this behalf, or (2) in a case where the object of the conspiracy is to commit any non cognizable offence, or a cognizable offence not punishable with death, imprisonment for life or rigorous imprisonment for a term of two years or upwards, unless the "State Government", or a Chief Presidency Magistrate or District Magistrate empowered in this behalf by the "State Government", has, by order in writing, consented to the initiation of the proceedings: Provided that where the criminal conspiracy is one to which the provisions of subsection (4) of section 195 apply no such consent shall be necessary." 314 The argument before us on behalf of the appellants has proceeded on the footing that in para 5 of the second complaint Saroj Ranjan Sarkar had alleged that the accused persons had entered into a criminal conspiracy with one another and other persons unknown, to dishonestly and fraudulently forge certain documents and in pursuance thereof either forged or caused to be forged those documents and used them as genuine. This allegation, it is argued attracted cl. (2) of section 196A inasmuch as the object of the conspiracy was to commit non cognizable offences under sections 467 and 471 of the Indian Penal Code; therefore, it was necessary to obtain, by order in writing, the consent of the State Government or of the Chief Presidency Magistrate to the initiation of the proceedings and such consent not having been obtained, the issue of processes by the Chief Presidency Magistrate violated the provisions of section 196A of the Code of Criminal procedure. The special Bench repelled this argument on the following grounds. It pointed out the distinction between the offence of criminal conspiracy as defined in section 120A and punishable by section 120B and the offence of abetment by conspiracy as defined in the clause, secondly, in section 107 of the Indian Penal Code. It then pointed out that the Chief Presidency Magistrate did not take cognizance of the offence of criminal conspiracy to commit forgery which would be punishable under section 120B read with section 467 of the Indian Penal Code, but he took cognizance of the offence of abetment of forgery punishable under section 467 read with section 109 of the Indian Penal Code and for this offence no sanction under section 196A of the Code of Criminal Procedure was necessary. The special Bench further expressed the view that the primary offences which the second complaint disclosed where the offence of forgery, of using forged documents as genuine, and of abetment of the said offences and as cognizance of these offences did not require sanction or 315 prior consent of the authorities mentioned in section 196A, the order of the Chief Presidency Magistrate could not be said to have violated the provisions of that section. The correctness of these views of the special Bench has been very seriously contested. I may make it clear at the very outset that the mandatory provisions of section 196A of the Code of Criminal Procedure cannot be evaded by resorting to a mere device or camouflage. The test whether sanction is or is not necessary does not depend on mere astuteness of drafting the petition of complaint. For example, in the second petition of complaint under consideration before us the heading indicated that the offences in respect of which the petition of complaint was filed were offences under sections 467, 471 and 109 of the Indian Penal Code; but in para. 5 of the petition the allegation was that the accused persons had entered into a criminal conspiracy with one another and others unknown, to forge certain documents. It would not be proper to decide the question of sanction merely by taking into consideration the offences mentioned in the heading or the use of the expression "criminal conspiracy" in para. The proper test should be whether the allegations made in the petition of complaint disclosed primarily and essentially an offence or offences for which a consent in writing would be necessary to the initiation of the proceedings within the meaning of section 196A(2) of the Code of Criminal Procedure. It is from that point of view that the petition of complaint must be examined. There is another principle laid down by this Court which should be kept in mind. The allegations made in the complaint may have more than one aspect; and may disclose more than one offence. What would be the position when some of the offences disclosed do not require any sanction while others require sanction ? This question was considered by this Court in 316 Basir ul huq vs State of West Bengal(1). That was case in which the accused person lodged information at a police station that X had beaten and throttled his mother to death and when the funeral pyre was in flames, he entered the cremation ground with police; the dead body was examined and the complaint was found to be false. On the complaint of X the accused person was charged with offences under section 297, Indian Penal Code (trespass to wound religious feelings) and section 500, Indian Penal Code (defamation). It was contended that as the complaint disclosed offences under section 182 and 211, Indian Penal Code, the Court could not take cognizance of the case except on a complaint by the proper authority under section 195 of the Code of Criminal Procedure. It was held that the facts which constituted the offence under section 297 where distinct from those which constituted an offences under section 182, as the act of trespass was alleged to have been committed after the making of the false report, so section 195 was no bar to the trial of the charge under section 297. It was further held that as regards the charge under section 500 where the allegations made in a false report disclose two distinct offences, one against a public servant and the other against a private individual, the latter is not debarred by provisions of section 195 of the Code of Criminal Procedure from seeking redress for the offence committed against him. Referring to section 195 of the Code of Criminal Procedure Mahajan, J. who delivered the judgment of the Court said: "The statute thus requires that without a complaint in writing of the public servant concerned no prosecution for an offence under section 182 can be taken cognizance of. It does not further provide that if in the course of the commission of that offence other distinct offences are committed, the magistrate is debarred from taking cognizance in respect of those offences as well. The allegation made 317 in a complaint may have a double aspect, that is on the one hand these may constitute an offence against the authority of the public servant or public justice, and on the other hand, they may also constitute the offence of defamation or some other distinct offence. The section does not per se bar the cognizance by the magistrate of that offence, even if no action is taken by the public servant to whom the false report has been made. x x x x As regards the charge under section 500, Indian Penal Code, it seems fairly clear both on principle and authority that where the allegations made in a false report disclose two distinct offences, one against the public servant and the other against a private individual, that other is not debarred by the provisions of section 195 from seeking redress for the offence committed against him. " Keeping the aforesaid two principles in mind let me examine the second complaint in this case in order to find out what essential offences the allegations made therein disclosed. Paragraph 5 of the petition of complaint on which much reliance has been placed on behalf of the appellant alleges (1) that the accused persons entered into a criminal conspiracy with one another and others unknown, to forge certain documents; (2) that in pursuance of the conspiracy those documents were forged; or caused to be forged; and (3) that the documents so forged were used as genuine. The paragraph then recited three documents which were said to have been forged. It is thus clear that apart from the conspiracy, the second complaint alleged that offences under sections 467 and 471 of the Indian Penal Code had also been committed. The special Bench rightly pointed out that the offences under sections 467 and 471 of the Indian Penal Code were distinct from the offence of criminal conspiracy and did not require any prior consent for the initiation of 318 Proceedings therefor under section 196A(2) of the Code of Criminal Procedure. The question, of therefore, boils down to this: in view of the allegation that there was a criminal conspiracy, was the chief Presidency Magistrate debarred from taking cognizance of the case even though certain other distinct offences were alleged which did not require sanction ? I am in agreement with the special Bench that the answer to the question must be in the negative. Furthermore, it appears to me that though the expression "criminal conspiracy" occurs in para. 5 of the complaint, the facts alleged in the petition of complaint essentially disclose an offence of abetment by conspiracy. This brings us to the distinction between the offence of criminal conspiracy as defined in section 120A and the offence of abetment by conspiracy as defined in section 107 of the Indian Penal Code. Section 120A which defines the offence of criminal conspiracy and section 120B which punishes the offence are in Ch. VA of the Indian Penal Code. This Chapter introduced into the criminal law of India a new offence, namely, the offence of criminal conspiracy. It was introduced by the criminal Law Amendment Act, 1913 (VIII of 1913). Before that, the sections of the Indian Penal Code which directly dealt with the subject of conspiracy were these contained in Ch. V and section 121 (Ch. VI) of the Code. The present case is not concerned with the kind of conspiracy referred to in section 121A. The point before us is the distinction between the offence of abetment as defined in section 107 (Ch. V) and the offence of criminal conspiracy as defined in section 120A (Ch. VA). Under section 107, second clause, a person abets the doing of a thing, who engages with one or more other person or persons in any conspiracy for the doing of that thing, if an act or illegal omission takes place in pursuance of that conspiracy, and an order to the doing of that thing. Therefore, in order to constitute the offence of abetment by conspiracy, there 319 must first be a combining together of two or more persons in the conspiracy; secondly, an act or illegal omission must take place in pursuance of that conspiracy, and in order to the doing of that thing. It is not necessary that the abettor should concert the offence with the person who commits it. It is sufficient if he engages in the conspiracy in pursuance of which the offence is committed. It is worthy of note that a mere conspiracy or a combination of persons for the doing of a thing does not amount to an abetment. Something more is necessary, namely, an act or illegal omission must take place in pursuance of the conspiracy and in order to the doing of the thing for which the conspiracy was made. Before the introduction of Ch. VA conspiracy, except in cases provided by sections 121A, 311, 400, 401 and 402 of the Indian Penal Code, was a mere species of abetment where an act or an illegal omission took place in pursuance of that conspiracy, and amounted to a distinct offence. Chapter VA, however, introduced a new offence defined by section 120A. That offence is called the offence of criminal conspiracy and consists in a mere agreement by two or more persons to do or cause to be done an illegal act or an act which is not illegal by illegal means; there is a proviso to the section which says that no agreement except an agreement to commit an offence shall amount to a criminal conspiracy unless some act besides the agreement is done by one or more parties to such agreement in pursuance thereof. The position, therefore comes to this. The gist of the offence of criminal conspiracy is in the agreement to do an illegal act or an act which is not illegal by illegal means. When the agreement is to commit an offence, the agreement itself becomes the offence of criminal conspiracy. Where, however, the agreement is to do an illegal act which is not an offence or an act which is not illegal by illegal means, some act besides the agreement is necessary. 320 Therefore, the distinction between the offence of abetment by conspiracy and the offence of criminal conspiracy, so far as the agreement to commit an offence is concerned, lies in this. For abetment by conspiracy mere agreement is not enough. An act or illegal omission must take place in pursuance of the conspiracy and in order to the doing of the thing conspired for. But in the offence of criminal conspiracy the very agreement or plot is an act in itself and is the gist of the offence. Willes, J. observed in Mulcahy vs The Queen (1): "When to agree to carry it into effect, the very plot is an act in itself, and the act of each of the parties, promise against promise, actus contra actum, capable of being enforced, if lawful, punishable if for a criminal object or for the use of criminal means. " Put very briefly, the distinction between the offence of abetment under the second clause of section 107 and that of criminal conspiracy under section 120A is this. In the former offence a mere combination of persons or agreement between them is not enough. An act or illegal omission must take place in pursuance of the conspiracy and in order to the doing of the thing conspired for; in the latter offence the mere agreement is enough, if the agreement is to commit an offence. So far as abetment by conspiracy is concerned the abettor will be liable to punishment under varying circumstances detailed in sections 108 to 117. It is unnecessary to detail those circumstances for the present case. For the offence of criminal conspiracy it is punishable under section 120B. Having regard to the distinction pointed out above, I am of the opinion that para. 5 of the second complaint, though it used the expression "criminal conspiracy" really disclosed an offence of abetment by conspiracy. It made no allegation 321 of any agreement between the several persons at a particular place or time. It said that the accused persons complained against entered into a conspiracy to forge certain documents were forged or caused to be forged. In other words, an illegal act was done in pursuance of the conspiracy and furthermore the documents so forged were used as genuine. Having regard to these allegations in para. 5 of the second complaint, I am unable to hold that the learned 'Chief Presidency Magistrate was wrong in taking cognizance of the offence of abetment by conspiracy, for which offence no consent or sanction under section 196A of the Code of Criminal Procedure was necessary. Therefore, there was violation of the provisions of that section. In this view of the matter it is unnecessary to consider the correctness or otherwise of the further view expressed in some of the decisions (see, for example, State of Bihar vs Srilal Kejriwal (1) to which the special Bench has referred) that there the matter has gone beyond a mere conspiracy and substantive offences are alleged to have been actually committed in pursuance thereof, sections 120A and 120B are wholly irrelevant. That view has not been accepted as correct by some of the other High Courts. In the State of Andhra Pradesh vs Kandimalla Subbaiah (2) this Court held that offences created by sections 109 and 120B, Indian Penal Code were distinct offences, though for a reason stated somewhat differently from what I have stated. It further held that where a number of offences were committed by several persons in pursuance of a conspiracy, it was not illegal to charge them with those offences as well as with the offence of conspiracy to commit those offences, though it was not desirable to charge the accused persons with conspiracy with the ulterior object of letting in evidence which would otherwise be inadmissible and furthermore, it was undesirable to complicate a 322 trial by introducing a large number of charges spread over a long period. The question was treated as one of propriety rather than of legality. The question of sanction was also considered in that case, but in view of the order of remand passed, no opinion was expressed thereon. The special Bench expressed the view that it was not necessary to go to the extent of saying that in a case of this nature sections 120A and 120B became wholly irrelevant. The special Bench proceeded on the footing that irrespective of whether sections 120A and 120B became wholly irrelevant or not the second complaint undoubtedly disclosed an offence of abetment by conspiracy and it was open to the Chief Presidency Magistrate to take cognizance of that offence. I think that there are no good reasons for holding that the view taken by the special Bench is not correct. In my opinion, the special Bench rightly overruled the objection as to the alleged violation of the provisions of section 196A of the Code of Criminal Procedure. Now, I come to the third and principal question agitated in these appeals. On behalf of one of the appellants, Saurindra Mohan Basu, Mr. Purushottam Trikumdas has argued before us that when the first complaint containing more or less the same allegations was dismissed under section 203 of the Code of Criminal Procedure by the Chief Presidency Magistrate, it was not at all open to his successor to entertain the second complaint. He has put the matter as one of law and has argued that the only way of getting rid of an order of dismissal under section 203 of the Code of Criminal Procedure known to the Code of Criminal Procedure is to have it act aside in accordance with the procedure laid down in sections 436 and 439 of the Code. He has further argued that, as a matter of law, a second complaint is not entertainable as long as the order of dismissal under section 203 of the Code 323 of Criminal Procedure is not set aside by a competent authority. His argument is that the two decisions in Nilratan Sen vs Jogesh Chandra Bhattacharjee(1) and Kamal Chandra Pal vs Gourchand Adhikary (2) should be held as good law. Section 403 of the Code of Criminal Procedure is relevant to this argument. It embodies the well established rule of common law that a man may not be put twice in peril for the same offence and that no man should be vexed with several trials for offences arising out of identical acts. An Explanation appended to the section says inter alia that the dismissal of complaint or the discharge of accused person is not an acquittal for the purposes of the section. If the Legislature had intended that the dismissal of complaint or the discharge of an accused person would be a bar to fresh proceeding on the same allegations unless the order of dismissal or discharge were set aside by a higher court, it would have said so either explicitly or by omitting the Explanation altogether. Therefore, the effect of the Explanation is that under section 403 a fresh trial is barred only in cases of acquittal or conviction by a court of competent jurisdiction, coming within the purview of sub section (1) thereof. This aspect of the question was considered in Queen Empress vs Dolegobind Dass (3), which was a case dealing with a previous order of discharge of the accused person. In that case, Maclean, C. J. referred to the decision in Nilratan Sen 's case and said: "There is no express provision in the Code to the effect that the dismissal of a complaint shall be a bar to a fresh complaint being entertained so long as the order of dismissal remains unreversed ' (see per Benerjee, J. in Nilratan Sens ' vs Jogesh Chandra Bhattacharjee (supra). I agree in that. If, then there be no express provision 324 in the Code, what is there to warrant us in implying or in effect introducing into the Code a provision of such serious import x x x? In the absence of any other provision in the Code to justify such an implication x x x x I can appreciate no sound ground for the Court so acting; were it to do so it would go perilously near to legislating, instead of confining itself to construing the Acts of the Legislature. " The question was then considered by a Full Bench of the Calcutta High Court in Dwarka Nath Mondul vs Beni Madhab Banerjee (1) and it was held by the Full Bench (Ghose, J. dissenting) that a Presidency Magistrate was competent to rehear a warrant case triable under Ch. XXI of the Code of Criminal Procedure in which he had earlier discharged the accused person. Nilratan Sen 's case(2) and Kamal Chandra Pal 's case(3) were referred to in the arguments as summarised in the report, but the view expressed therein was not accepted. Dealing with the question Princep, J. said: "There is no bar to further proceedings under the law, and, therefore, a Magistrate to whom a complaint has been made under such circumstances, is bound to proceed in the manner set out in section 200, that is, to examine the complaint, and, unless he has reason to distrust the truth of the complaint, or for some other reason expressly recognised by law, such as, if he finds that no offence had been committed, he is bound to take cognizance of the offence on a complaint, and, unless he has good reason to doubt the truth of the complaint, he is bound to do justice to the complainant, to summon his witness and to hear them in the presence of the accused." 325 The same view was expressed by the Madras High Court in In re. Koyassan Kutty (1) and it was observed that there was nothing in law against the entertainment of a second complaint on the same facts on which a person had already been discharged, inasmuch as a discharge was not equivalent to an acquittal. This view was reiterated in Kumariah vs Chinna Naicker (2), where it was held that the fact that a previous complaint had been dismissed under section 203 of the Code of Criminal Procedure was no bar to the entertainment of a second complaint. In Hansabai Sayaji vs Ananda Ganuji (3) the question was examined with reference to a large number of earlier decisions of several High Courts on the subject and it was held that there was nothing in law against the entertainment of a second complaint on the same facts. The same view was also expressed in Ram Narain vs Panachand Jain (4), Ramanand vs Sheri (5), and Allah Ditta vs Karam Baksh (6). In all these decisions it was recognised further that though there was nothing in law to bar the entertainment of a second complaint on the same facts, exceptional circumstances must exist for entertainment of a second complaint when on the same allegations a previous complaint had been dismissed. The question of the existence of exceptional circumstances for the entertainment of a second complaint is a question to which I shall come later. At the present moment, I am considering the argument of Mr. Purshottam Tricumdas that the law prohibits altogether the entertainment of a second complaint when a previous complaint on the same allegations had been dismissed under section 203 of the Code of Criminal Procedure. On this question the High Courts appear to me to be almost unanimously against the contention of Mr. Purshottam Tricumdas, and for the reasons given in the decisions to which I have earlier referred, I 326 am unable to accept his contention. I accept the view expressed by the High Courts that there is nothing in law which prohibits the entertainment of a second complaint on the same allegations when a previous complaint had been dismissed under section 203 of the Code of Criminal Procedure. I also accept the view that as a rule of necessary caution and of proper exercise of the discretion given to a Magistrate under section 204(1) of the Code of Criminal Procedure, exceptional circumstances must exist for the entertainment of a second complaint on the same allegations; in other words, there must be good reasons why the Magistrate thinks that there is "sufficient ground for proceeding" with the second complaint, when a previous complaint on the same allegations was dismissed under section 203 of the Code of Criminal Procedure. The question now is, what should be those exceptional circumstances ? In Queen Empress vs Dolagobind Dass (1), Maclean, C. J. said: "I only desire to add that no Presidency Magistrate ought, in my opinion, to rehear a case previously dealt with by a Magistrate of coordinate jurisdiction upon the same evidence only, unless he is plainly satisfied that there has been some manifest error or manifest miscarriage of justice." Thus, according to this decision, the exceptional circumstance must be such as would lead the Magistrate to think that the previous order of dismissal was due to a manifest error or resulted in a manifest miscarriage of justice. In re. Koyassan Kutty (2) Sadasiva Aiyar, J. formulated the test of exceptional circumstances in the following words: "Taking it then that the discharge was proper and legal, there is no doubt nothing in law against the entertainment of a second 327 complaint on the same facts as a discharge is not equivalent to an acquittal; but I think that unless very strong grounds are shown a person who has been charged once and discharged ought not to be harassed again on the same charge. It is not alleged that new facts have been discovered which the police did not know when they brought the first charge. " In this decision the test formulated was the discovery of new facts which were not known when the first charge of complaint was made. In Kumariah vs Chinna Naicker(1) the same test was again applied when it was observed: "There is nothing to indicate that there was no proper investigation on the previous complaint or that there was any necessity for investigating the second complaint. x x x No additional witness had been cited in the second complaint, nor, as pointed out by the Additional Magistrate, was it alleged that any other kind of evidence had been discovered or was likely to be forthcoming. " It is worthy of note, however, that Kuppuswami Aiyar, J. did not say that the discovery of a new fact or new evidence must be of such a character that it was not known to the complainant when the prior complaint was brought and dismissed. In Hansabai Sayaji vs Ananda Ganuji (2) it was pointed out that the circumstance that the second complaint was filed by a person other than the one who made the first complaint made no difference and the test laid down in some early Rangoon High Court decisions [Ma The Kin vs Nga E Tha (3) and U Shwe vs Ma Sein Bwin (4) ], was accepted as the correct test. In Ma The Kin 's case (supra) the test was thus expressed: 328 "It is the duty of a Magistrate, therefore, who receives a complaint in a case where there has been a previous order of dismissal or discharge, not to issue process, unless he is plainly satisfied that there has been some manifest error or manifest miscarriage of justice, or unless new facts are adduced which the complainant had not knowledge of or could not with reasonable diligence have brought forward in the previous proceedings. " It will be noticed that in the test thus laid down the exceptional circumstances are brought under three categories; (1) manifest error, (2) manifest miscarriage of justice, and (3) new facts which the complainant had no knowledge of or could not with reasonable diligence have brought forward in the previous proceedings. Any exceptional circumstances coming within any one or more of the aforesaid three categories would fulfil the test. In Ram Narain vs Panachand Jain (1) it was observed that an exhaustive list of the exceptional circumstances could not be given though some of the categories were mentioned. One new category mentioned was where the previous order of dismissal was passed on an incomplete record or a misunderstanding of the nature of the complaint. This new category would perhaps fall within the category of manifest error or miscarriage of justice. It appears to me that the test laid down in the earliest of the aforesaid decisions. Queen Empress vs Dolegobind Dass (2), is really wide enough to cover the other categories mentioned in the later decisions. Whenever a Magistrate is satisfied that the previous order of dismissal was due to a manifest error or has resulted in a miscarriage of justice, he can entertain a second complaint on the same allegations even though an earlier complaint was dismissed under section 203 329 of the Code of Criminal Procedure. I do not think that in a matter of this kind it is either possible or even desirable that the exceptional circumstances must be stated with any more particularity or precision. The learned Advocate for the respondent argued before us that a new category should be added and he called it "frustration of justice". I am of the view that apart from any question of felicity of this new expression, this new category does not give any more assistance towards explaining the exceptional circumstances which must exist before a second complaint on the same allegations can be entertained. I am content in this case to proceed on the footing that, the Magistrate must be satisfied that there was a manifest error or a miscarriage of justice before he can entertain a second complaint on the same facts. In this case, two exceptional circumstances were adverted to before us. One is that the learned Chief Presidency Magistrate who dealt with the first complaint completely misdirected himself as to the true scope and effect of sections 203 and 204 of the Code of Criminal Procedure and this, it is contended, resulted in a manifest miscarriage of justice when he dismissed the first complaint under section 203 of the Code of Criminal Procedure. I am of the view that there is substance in this contention. Section 203 of the Code of Criminal Procedure states that the Magistrate may dismiss the complaint, if, after considering the statement on oath, if any, of the complainant and the witnesses and the result of the investigation or enquiry, if any, under section 202, there is in his judgment no sufficient ground for proceeding. Section 204 lays down that if in the opinion of the Magistrate taking cognizance of an offence there is sufficient ground for proceeding, he shall issue a summon or a warrant, as the case may require. What is the true scope and effect of the expression 330 "sufficient ground for proceeding" occurring in the aforesaid two sections ? This was considered by this Court in Vadilal Panchal vs Dattatraya Dulaji Ghadigaonker (1). With reference to sections 200, 202 and 203 of the Code of Criminal Procedure it was there observed: "The inquiry is for the purpose of ascertaining the truth or falsehood of the complaint; that is, for ascertaining whether there is evidence in support of the complaint so as to justify the issue of process and commencement of proceedings against the person concerned. The section does not any that a regular trial for adjudging the guilt or otherwise of the person complained against should take place at that stage; for the person complained against can be legally called upon to answer the accusation made against him only when a process has issued and he is put on trial. " It was further observed that if the Magistrate had not misdirected himself as to the scope of an enquiry under section 202 and had applied his mind judicially to the materials before him, it would be erroneous in law to hold that a plea based on an exception could not be accepted by in arriving at his judgment. In another decisions of this Court Ramgopal Genapatria Ruia vs State of Bombay (2) the expression "sufficient grounds" occurring in sections 209, 210 and 213 of the Code of Criminal Procedure was considered and it was held that the expression did not mean sufficient grounds for the purpose of conviction but meant such evidence as would be sufficient to put the accused upon trial by the jury dealing with the first complaint the learned Chief Presidency Magistrate proceeded to consider not whether there was 331 sufficient ground for proceeding within the meaning of sections 203 and 204 of the Code of Criminal Procedure but whether there was sufficient evidence for conviction of the accused persons. In my opinion, this approach was completely wrong and resulted in a manifest miscarriage of justice. The learned Chief President Magistrate said: "In cases depending on circumstantial evidence in order to justify any inference that an offence has been committed the incriminating facts must be incompatible with innocence of the person accused and incapable of explanation upon any other reasonable hypothesis than that of his guilt. If the circumstances are found to be as consistent with the guilt of the accused, no inference of guilt can be drawn. In the present case the circumstances above equally may lead to the inference that the document was ante dated and might or might not have been forged. Therefore the circumstances are not precise to be of any value as evidence. " These observations clearly show that the learned Chief Presidency Magistrate misdirected himself as to the true scope and effect of sections 203 and 204 of the Code of Criminal Procedure. He did not keep in mind the true purpose of the enquiry before him which was to ascertain whether there was evidence in support of the complaint so as to justify the issue of process and commencement of proceedings against the accused persons. He further failed to keep in mind that sections 203 and 204 of the Code of Criminal Procedure did not say that a regular trial for judging the guilt or otherwise of the person complained against should take place at that stage. It was not for learned Chief Presidency Magistrate to apply the test whether the circumstances were or were not incompatible with the, innocence of the accused persons. The 332 purpose of the enquiry before him was merely to ascertain prime facie the truth or falsehood of the complaint. Instead of holding an enquiry into the complaint, the learned Chief Presidency Magistrate proceeded as though he was trying the ease itself on merits. I consider that this mistake on the part of the learned Chief Presidency Magistrate gave a wrong direction to the whole proceedings on the first complaint and the order of dismissal passed by him was due to a manifest error and resulted in miscarriage of justice. The second exceptional circumstance is as to the presence of the telephone number "City 6091" printed on the sheet of paper on which were typed the minutes of the proceedings dated January 16, 1948. When the first complaint was dealt with by the Chief Presidency Magistrate no evidence was led to show that the City Exchange did not come into existence until December, 1948 and that the telephone connection relating to that particular number was obtained for the first time by the Hindusthan Co operative Insurance Society Ltd. on or about March 18, 1949. This I think, would be a new matter which was not considered when the first complaint was dismissed under section 203 of the Code of Criminal Procedure. There was a good deal of argument as to whether this matter relating to the City Exchange was known to the complainant and his brothers from before, and if so, why they did not bring it to the notice of the learned Chief Presidency Magistrate who dealt with the first complaint. it appears that an application dated June 7, 1955 was made before Debabrata Mookerjee J. who heard the application in revision with regard to the first complaint. In that application certain statements were made with regard to the City Exchange. Those statements did not, however, include any averment as to the knowledge of the complainant, Promode Ranjan Sarkar, about 333 the facts relating to the City Exchange and telephone number "City 6091". The application merely stated that the facts stated therein were matters of public history and it was essential in the ends of justice to take judicial notice thereof. Debabrata Mookerji, J. apparently rejected this application but did not record any formal orders on that date. He recorded formal orders after he had dismissed the application in revision. He said therein that he was not prepared to take into consideration the facts alleged in the application dated June 7, 1955 as they related to new matters. The argument on behalf of the appellants before us is that the facts relating to the City Exchange were not new matters, because the complainant, Saroj Ranjan Sarkar, nowhere said that he did not know them before. The argument, therefore is that it does not fulfil the test of "new facts which the complainant have no knowledge of or could not with reasonable diligence have brought forward in the previous proceedings". The learned Advocate for the respondent has, in my opinion, rightly submitted that it is somewhat illogical to say at one stage of the proceedings that the matter was a new matter and could not, therefore, be taken into consideration and at a later stage to say that it is not a new matter and therefore could not be taken into consideration. This much, however, is clear that the matter relating to the City Exchange and in particular telephone number "City 6091" was not at all considered when the first complaint was dismissed under section 203 of the Code of Criminal Procedure. This matter is of some importance because if there was no such telephone number on January 16, 1948, the minutes of the proceedings purporting to be of that date must have come into existence on a later date. This would have great relevance and bearing on the allegation of forgery made with regard to the minutes of the proceedings dated January 16, 1948. 334 On behalf of Saurindra Mohan Basu it was further contended that there was not even prima facie evidence against him and the learned Chief Presidency Magistrate was wrong in issuing process against him. It is only necessary to point out that the learned Chief Presidency Magistrate found that there was a prima facie case against Saurindra Mohan Basu. He had attested the signature of the late Nalini Ranjan Sarkar and if that signature was forged, then that would be prima facie evidence against Saurindra Mohan Basu also. My learned brethren have taken the view that the entertaining of the second complaint in the circumstances of this case is a gross abuse of the processes of the Court. I find myself unable to subscribe to that view. My conclusion is just the opposite, namely, that the entertaining of the second complaint fully serves the interests of justice. I am further of the opinion that its dismissal would defeat the ends of justice. In this connection, I have already referred to the two exceptional circumstances which exist: one is that the learned Chief Presidency Magistrate who dealt with the first complaint completely misdirected himself as to the true scope and effect of sections 203 and 204 of the Code of Criminal Procedure; the second is that Debabrata Mookerjee, J. wrongly refused to take into consideration the circumstances relating to the installation of the City Exchange and telephone number "City 6091", circumstances which had a decisive bearing on the allegation of forgery made with regard to the minutes of the proceedings dated January 16, 1948. Even a cursory perusal of the order of the Chief President Magistrate (Shri N. C. Chakravarti) dated August 6, 1954 with regard to the first complaint shows that the learned Chief Presidency Magistrate proceeded on the footing as though he was trying a case based entirely on circumstantial evidence; he formulated 335 the tests for drawing conclusions from circumstantial evidence and applying those tests, he came to the conclusion that the complaint was not true. He rejected the evidence of the hand writing expert as though it was his function to try the case. He rejected the enquiry report of Shri A. B. Syam (who held that there was a prima facie case for the issue of process) on very insufficient grounds. He even went to the length of judging for himself the peculiar characteristics of Nalini Ranjan Sarkar 's hand writing depending on the personality of the writer. In my view, in all these matters the learned Chief Presidency Magistrate misdirected himself as to the true scope of the enquiry before him and he forgot that what he had to find was whether prima facie there was believable evidence in support of the allegations made in the complaint. This does not necessarily mean that a Magistrate dealing with a complaint is obliged "to bind himself to a mere mechanical or a wholly uncritical acceptance of the complainant 's story". Indeed, it is the duty of the Magistrate to judge the materials on which he has to make up his mind as to the sufficiency or otherwise of the ground for proceeding further with the complaint and in judging the materials he must sift them and submit them to a critical examination. This aspect of the question was argued before Debabrata Mookerjee, J. and he referred to it in his judgment. I say this without meaning any disrespect to the learned Judge, but it appears to me that he missed the distinction which was pointed out by this Court in Ramgopal Ganpatrai Ruia vs The State of Bombay(1) namely that the expression "sufficient grounds" occuring in sections 209, 210 and 213 of the Code of Criminal Procedure does not mean sufficient grounds for the purpose of conviction, but means such evidence as is sufficient to put the accused person upon trial by the jury. In sections 203 and 204, Criminal Procedure Code, the expres 336 sion is "sufficient ground for proceeding" which really means sufficient ground for proceeding with the complaint. Sufficient ground for proceeding with the complaint is one matter and sufficient ground for convicting an accused person is quite a different matter. It is this distinction which has to be kept in mind and the failure to keep such a distinction in mind in the present case has resulted in a manifest error. Debabrata Mookerjee, J. detailed seven circumstances as those on which the complainant relied in support of the allegation of forgery. He then went on to deal those circumstances as though the function of the Court then was to find out whether there was sufficient ground for convicting the accused person. I refer particularly to the view expressed by the learned Chief Presidency Magistrate to the effect that one of the documents in question might have been ante dated by Nalini Ranjan Sarkar himself. This was a suggestion made on behalf of the accused persons as a possible defence to the charge of forgery and it was not the function of the Chief Presidency Magistrate to consider the defence at that stage. Debabrata Mookerjee, J. himself said: "If, on the other hand, the Magistrate has met the facts alleged by the complainant by anticipating possible defences to the charge, thus travelling beyond the facts themselves and the inferences and the probabilities legitimately raised by them, he must be held to have exceeded the allowable limits of an initial test of the complainant 's story." Yet, the possible defence that Nalini Ranjan Sarkar might have himself ante dated the document was not only considered by the learned Chief Presidency Magistrate but was accepted by Debabrate Mookerjee J. This, in my opinion, clearly demonstrates the manifest error or injustice which has taken place in this case, though in the concluding part of his 337 judgment Debabrata Mookerjee, J. expressed the view that he did not consider that the learned Chief Presidency Magistrate had over stepped the permissible limits of a preliminary probe into the truth or otherwise of the complainant 's story. He further said that in his view the learned Chief Presidency Magistrate in sifting the materials offered did not dispose of them by anticipating a possible defence of the parties; yet the one possible defence to the charge of forgery was that Nalini Ranjan Sarkar might himself have antedated the document in question and that very defence was considered and accepted not only by the learned Chief Presidency Magistrate but by Debabrata Mookarjee, J. also. The second mistake which led to a manifest injustice was the refusal to take into consideration the circumstances relating to the installation of the City Exchange and the telephone number "City 6091". Debabrata Mookerjee, J. made no orders on the application dated June 7, 1955. In his final order he said: "The application speaks for itself. I was not prepared on that date to take any notice of the new matters mentioned in that application and I adhere to my decision. " In my view Debabrata Mookerjee, J. was grievously in error in rejecting the application. As I have said earlier, the circumstances relating to the installation of the City Exchange and telephone number "City 6091" had a decisive bearing on the truth or otherwise of the allegation of forgery and to reject the application to take those circumstances into consideration really amounted to a denial of justice. Debabrata Mookerjee, J. took the view that it was a new matter which could not be taken into consideration and, pradoxically enough, the argument before us is that not being a new matter, it should not have been taken into consideration 338 in connection with the second complaint. This paradox clearly demonstrates the injustice that will result from a failure to take into consideration circumstances which are decisive of the allegations made in the complaint. When the complainant made an application for a certificate for appeal to the Supreme Court against the order passed by Dababrata Mookerjee. J., he forcefully contended that the refusal to take notice of the circumstances relating to the installation of the City Exchange amounted to a denial of justice. This application was dealt with by a Bench of two Judges of the Calcutta High Court (Das Gupta and Bachawat, JJ.). The learned Judges expressed the view that if they were dealing with the matter, they would have thought it right to refer to the appropriate books for ascertaining the date on which the City Exchange came into existence. They, however, felt that the matter was within the discretion of Debarata Mookerjee, J. and they were not prepared to give a certificate in a matter of discretion. Another point which was urged before that Bench was this. The complaint was for offences triable by the Court of sessions and the question which the learned Chief Presidency Magistrate had to put himself was not whether he, for himself, believed the allegations to be true but whether the materials before him were such that thereupon a reasonable body of men might believe the allegations to be true. The learned Judge said: "In our judgment there is considerable force in this argument, but at the same time we have to take notice of the fact that this question does not appear to have been decided by the courts." Since those observations were made, a decision has been given by this Court and that decision supports the contention urged on behalf of the complainant. The matter then came to this Court on an applica 339 tion for special leave, and special leave was granted by this Court on February 13, 1956. An appeal was filed in pursuance of that special leave, but ultimately Promode Ranjan Sarkar withdrew his appeal by filing a petition on February 3, 1959. In that petition he stated that at the intervention of common friends and well wishers of the parties, he had settled his disputes with the respondents therein and did not want to proceed with the appeal a statement which, in the circumstances of this case, amounts almost to compounding a felony. The appeal was accordingly withdrawn on March 12, 1959. The present complaint, Saroj Ranjan Sarkar, alleged in his petition of complaint that the withdrawal of the appeal filed in this Court in the circumstances stated above was due to undue influence exercised by the accused persons. Whether that allegation is correct or not can only be determined after evidence has been led. There are, however, circumstances which seem to me indicate that the withdrawal of the appeal in this Court was for the purpose of defeating the ends of justice. The accused persons must have realised that if the evidence relating to the installation of the City Exchange and telephone No. "City 6091" was available and considered, then there would be no escape from the position that the minutes of the proceedings of the Board meeting of N.R. Sarkar and Co. Ltd., dated January 16, 1948 must have been forged and this aspect of the matter was very rightly emphasised by the learned Chief Presidency Magistrate (Shri Bijayesh Mukherjee) who dealt with the second complaint as also by the Special Bench of three Judges who dealt with the matter on the revision applications made against the order of the learned Chief Presidency Magistrate on the second complaint. It is also worthy of note that this Court must have granted special leave in respect of the order passed on the first complaint, because it felt that there were arguable points in support of the 340 application for special leave, one of such points apparently being the refusal to consider the circumstances relating to the installation of the City Exchange. On the second complaint the learned Chief Presidency Magistrate, as also the High Court, took those circumstances into consideration and rightly held that those circumstances clearly indicated that the allegations made in the complaint were prima facie true. The learned Chief Presidency Magistrate further held that having regard to the antecedent circumstances, there was no undue delay in filing the second complaint. He further held that there was no intention to blackmail, in the sense that one brother having failed on the first complaint, another brother was fraudulently trying to start afresh the criminal law in motion. These findings of the learned Chief Presidency Magistrate were accepted by a Special Bench of three Judges of the Calcutta High Court. I have heard nothing in the course of the arguments addressed before us which would justify me to go behind those findings, particularly in an appeal filed by special leave under article 136 of the Constitution. The learned Chief Presidency Magistrate and a Bench of three Judges of the Calcutta High Court held specifically on the second complaint that there was a prima facie case and the dismissal of the first complaint resulted in manifest injustice. I see no reasons to differ from the view thus expressed by the learned Chief Presidency Magistrate and the High Court. For these reasons I have come to the conclusion that there are no good grounds for interfering with the judgment and order of the Special Bench dated December 22/33, 1960. I would accordingly dismiss the two appeals. The Judgment of Kapur and Hidayatullah, JJ., was delivered by KAPUR, J. There are two appeals against the judgment and order of the High Court of 341 Calcutta which raise the question of competency of a second complaint in regard to the same matter after the first complaint has been dismissed under section 203 of the Code of Criminal Procedure. The respective appellants in the two appeals are P. N. Taluqdar and Sourindra Mohan Basu an attorney of Calcutta against whom process has been issued by the Chief Presidency Magistrate Calcutta on a complaint filed by the respondent Saroj Ranjan Sarkar. The facts of these appeals are these: In 1944 a private limited company N. R. Sarkar & Co., Ltd. was formed by the late Mr. N. R. Sarkar, who was a well known financier and industrialist and a public man of Bengal. This company was the Managing Agent of several public limited companies such as Hindusthan Development Corporation Ltd., Hindusthan Chemicals Limited, Hindusthan Pilkington Glass Works Limited etc. Mr. N. R Sarkar was the Managing Director of N. R. Sarkar & Co., Ltd. Out of the share capital of this company he held 4649 shares. His younger brother Promode Ranjan Sarkar held 50 shares. Appellant P. N. Taluqdar who was a paid employee of the Hindusthan Cooperative Insurance Co., Ltd. held 300 shares and was a director of the Company and Shanti Ranjan Sarkar, a son of N. R. Sarkar 's deceased brother, held one share. As Mr. N. R. Sarkar became the Finance Minister in the West Bengal Government, he obtained leave of absence on January 4, 1948, from the directors of N. R. Sarkar & Co. Ltd. for a period of one year which was subsequently extended for another year. This was by a resolution passed on March 10, 1948. Mr. N. R. Sarkar joined the Government on January 23, 1948 and in August 1948 Dr. N. N. Law became a director of N. R. Sarkar & Co., Ltd. On July 31, 1951 Mr. N. R. Sarkar executed a deed of trust in respect of 2920 shares out of his 342 holding in Hindusthan Cooperative Society Ltd. and 3649 shares out of the shares held by him in N. R. Sarkar & Co. Ltd. By this deed he appointed as trustees his younger brother Promode Ranjan Sarkar, appellant P. N. Taluqdar and Dr. N. N. Law and the beneficiaries under the trust deed were his four younger brothers including the complainant and Shanti Ranjan Sarkar, his nephew. It is alleged that the balance of 1,000 shares was to be kept in trust by the appellant P. N. Taluqdar for the benefit of his brothers and nephew. N. R. Sarkar died on January 25, 1953. It is alleged that a few days after the death of Mr. N. R. Sarkar, the appellant, Sourindra Mohan Basu in a casual manner informed Promode Ranjan Sarkar that his brother N. R. Sarkar had executed two documents one an unregistered deed of agreement dated January 19, 1948, appointing the appellant P. N. Taluqdar as the Managing Director of N. R. Sarkar & Co., Ltd. and a deed of transfer dated February 5, 1951, transferring 1,000 shares in N. R. Sarkar & Co. Ltd., in his P. N. Taluqdar 's) favour. Promode Ranjan Sarkar and his brothers without giving much credence to this information wanted to see the documents but they were not allowed to do so. On July 31, 1953, appellant P. N. Taluqdar resigned from the Hindusthan Cooperative Insurance Society Ltd., in order to take control of N. R. Sarkar & Co Ltd., as it Managing Director. This led to trouble between Promode Ranjan Sarkar and the appellant P. N. Taluqdar and there was some correspondence between Promode Ranjan Sarkar and the appellant P. N. Taluqdar which it is unnecessary to refer to. At a meeting of the Board of Directors of N. R. Sarkar & Co., held on September 22, 1953, the appointment of appellant P. N. Taluqdar as Managing Director of N. R. Sarkar & Co. Ltd., was renewed for a period of seven years. This in spite of the 343 protest of Promode Ranjan Sarkar and in spite of the fact that that item was not on the agenda of the meeting. On October 1,1953, Promode Ranjan Sarkar took inspection of the agreement. On October 13, 1953, he took inspection of the Minute book and took photostat copies of some of the documents but not of the resolution of January 16, 1948. It is alleged that the appellants and other entered into a criminal conspiracy and fraudulently forged certain documents which in the complaint are described thus: (a) "An unregistered deed of agreement purporting to have been executed by the late Sri Nalini Ranjan Sarkar as Governing Director of N. R. Sarkar & Company Limited on 19th January 1948, (while he was on leave as stated above) appointing accused No. 1 (P. N. Taluqdar) as the Managing Director of N. R. Sarkar & Company Limited on a remuneration of Rs. 1,500 100 2,000/ per month and the deed bears the signature of accused No. 2 (section N. Basu) as the sole attesting witness. (b) A transfer deed in respect of 1000 shares of N. R. Sarkar & Co. Ltd., which has been entrusted to accused No. 1 as stated before, transferring them to accused No. 1 for an alleged consideration of Rs. 1,00,000(Rupees One Lakh) also purporting to have been executed by the late Sri Nalini Ranjan Sarkar on 5th February, 1951, with accused No. 2 as attesting witness both for the transferor and transferee. 344 (c) Minutes of the proceedings of the Board. Meetings of the said N. R. Sarkar & Company Limited including those of a meeting dated 16th January, 1948, purporting to bear the signature of the aforesaid late Sri Nalini Ranjan Sarkar. " These documents, it is alleged, are forged and have been used and by the use of these forged documents a fraud has been perpetrated. On April 3, 1959, respondent filed in the Court of the Chief Presidency Magistrate, Calcutta, a complaint under sections 467, 471 read with section 109 of the Indian Panel Code against the two appellants, Dr. N. N. Law and A. Chakravarti. Document No. (b) above is not the subject matter of the complaint because a suit in regard to it has been filed and is pending in the Calcutta High Court. On May 7, 1959, process was issued against the appellants by the Chief Presidency Magistrate. Before dealing with the allegations in this complaint it is necessary to give some further facts of the case. On December 12, 1953 Pramode Rajan Sarkar laid an information with the Commissioner of Police, Calcutta, against the persons against whom the above mentioned complaint was later filed. It appears that the matter was investigated by the police and by a letter dated February 16, 1954, the Police Commissioner expressed the opinion that there was no substance in the allegations which were being made by Pramode Ranjan Sarkar against the appellants and two others. He stated ". I have given this matter very careful consideration gone through various reports and papers and even examined an important witness myself. My examination has led me to conclusion that allegations are false and vexations. " On March 17, 1954, Pramode Ranjan Sarkar filed a complaint under sections 467, 471 and ss.457, 471 read with section 109. After setting out the facts which have 345 been given above and after referring to the three documents which were alleged to have been forged it was stated that the deed of agreement was engrossed on a stamp paper purchased in the name of P.D. Himmatsinghka & Co., a firm of solicitors, instead of in the name of the parties; that the resolution of January 16, 1948, which purported to bear the signature of the deceased was in fact not signed by him; that during the lifetime of Nalini Ranjan Sarkar and after a considerable period after his death the appellant, P. N. Taluqdar, never alleged that he had been appointed the Managing Director of N. R. Sarkar & Co. Ltd., nor did even appear from any resolution of the Board of N. R. Sarkar & Co., that he was appointed the Managing Director until September, 1953. Certain other allegations which need not be set out at this stage were also made in this complaint for the purpose of showing that the appellants had been guilty of forgery and for using forged documents and for conspiracy. The matter was heard by the Chief Presidency Magistrate Mr. N. C. Chakraborty who after examining all the witnesses who were produced before him dismissed the complaint by an order dated August 6, 1954. The learned Chief Presidency Magistrate examined the handwriting expert and after taking all the facts into consideration he held: "that the evidence on handwriting including the opinion of the Handwriting Expert does not support the complainant 's version." Against this order the complainant Pramode Ranjan Sarkar took a revision to the Calcutta High Court which was heard by Debabrata Mookerjee, J. Before him three contentions were raised (1) that the Chief Presidency Magistrate erred in examining the witnesses himself after he had received the result of the enquiry held by Mr. A. B. Shyam, 346 another Magistrate, under section 202, Code of Criminal Procedure; (2) the learned Magistrate misunderstood the scope of sections 202 and 203 and misdirected himself by insisting upon a standard of proof which the law did not require at the initial stage when the only question was whether the process should issue or not and the third contention related to the power of revision of High Court under section 439 when dealing with orders of a Chief Presidency Magistrate. The learned Judge held against the complainant, Pramode Ranjan Sarkar on the points that were raised before him. He held that it was open to the Chief Presidency Magistrate to examine witnesses; (2) the learned Magistrate had not misdirected himself in regard to the scope of sections 202 and 203 and that he could dismiss the complaint if in his judgment there was no sufficient ground for proceeding. He also held that the order of Magistrate was liable to be interfered with if it was made in disregard of the rules of procedure or it was so grossly improper or so palpably incorrect as to require a revision in the interest of justice. The learned judge then examined the evidence which had been produced before the Magistrate and taking the various circumstances into consideration discharged the rule and dismissed the revision, holding that the complainant Pramode Ranjan Sarkar was guilty of undue delay in taking action against the appellants, because he came to know on October 13, 1953, as to the forged nature of the documents and did not take any action till he wrote to the Police Commissioner to which he got reply on February 16, 1954, and he did not file any complaint or take any action till march 17, 1954, and this delay was unexplained. He also held that the complainant Pramode Ranjan Sarkar 's belief in regard to forgery was not established by the evidence which had been produced because (1) he came to know about the agreement complained of in February, 1953, but he discredited it and did 347 not take any action; (2) that when the agreement came up for renewal on September 22, 1953, for another term of the 7 years he did not oppose it on the ground that it was a forgery but on legal grounds. The learned judge did not believe the evidence of Pramode Ranjan Sarkar that up to February, 1954, he considered it absurd that there could be such a document. He referred to the correspondence which passed between the complainant and the appellant P. N. Taluqdar. He also considered the evidence relating to the watermark and the circumstances in support of the allegation of the theory of forgery and not being satisfied with the evidence he dismissed the revision petition and thus the order of the Chief Presidency Magistrate Mr. Chakraborti was upheld. It may be pointed out that on behalf of complainant Pramode Ranjan Sarkar an application was made on June 6, 1955, drawing the attention of the Court to the fact that on the sheet of a paper on which the minutes of the meeting held on January 16, 1948, had been typed there was printed Telephone "City 6091" and that Exchange had not come into existence till December, 1948. It was not stated when the complainant came to know of this fact. The learned Judge did not pass any separate order on this application and did not take it into consideration in his judgment. Against this order an application was made for a certificate under article 134(1)(c) which was dismissed but in that order this fact as to the City Exchange coming into existence in December, 1948, has been taken note of. Pramode Ranjan Sarkar then applied to this Court for Special Leave which was granted on February 13, 1956, but the appeal was withdrawn and was therefore dismissed or March 2, 1959. The present respondent Saroj Ranjan Sarkar then brought a complaint under the same sections 348 on April 3, 1959, making the same allegations as were made by his elder brother Pramode Ranjan Sarkar but there is one further allegation as to the Telephone City Exchange which did not find place in the previous complaint, In this complaint after referring to the facts which have been set out above it was alleged in paragraph 5 as follows : "That in order to assume complete control over N. R. Sarkar & Co., Ltd. and the concerns under its Managing Agency, the accused, entered into a criminal conspiracy with each other and others unknown, to dishonestly and fraudulently forged a Deed of Agreement, a Deed of Transfer and make a false document, to wit, minute book of N. R. Sarkar & Co. Ltd., and in pursuance thereof dishonestly and fraudulently forged and/or caused to be forged and used as genuine the said documents. " The grounds for forgery were that the unregistered deed dated January 19, 1948, was engrossed on a stamp paper purchased in the name of M/s. P. D. Himmatsinghka & Co; that the late N. R. Sarkar was on leave granted by the company and he never attended any meeting of the Board for more than four years as long as he was a Finance Minister; that the signature of Mr. N. R. Sarkar on the resolution dated January 16, 1948, was forged; that during the lifetime of N.R. Sarkar it was never given out by the appellant P. N. Taluqdar that he had been appointed a Managing Director, that in none of the papers and correspondence and resolutions of the Board until September, 1953, does it appear that the appellant, P. N. Taluqdar, was its Managing Director; that the appellant, P. N. Taluqdar continued to hold his post in the Hindusthan Cooperative Insurance Society Ltd. up to the end of July, 1953; that the signature in the deed of appointment was halting and appeared to be a forgery even to the naked eyes; that the resolution 349 for renewal for seven years was passed in spite of the protest of Pramode Ranjan Sarkar who was a director of N. R. Sarkar & Co. Ltd., and inspection of the deed of appointment was not given to Pramode Ranjan Sarkar in spite of his demands. It was further alleged that the resolutions of the Board of Directors were all on loose sheets of paper, that the signature on the resolutions were forged; that there was internal evidence to show that the genuine minutes book had been dishonestly changed; that the minutes of the proceeding of the Board of Directors said to have been held on January 16, 1948, were on a typed sheet; that the Telephone No. "City 6091" was printed thereon and the City Exchange was not in existence in January, 1948, but came into existence in December, 1948. It was prayed that the accused named therein which included the two appellants be proceeded against under sections 467, 471 read with section 109 of the Indian Penal Code. It will be noticed therefore that all the allegations made by Saroj Ranjan Sarkar are the same as those made by Pramode Ranjan Sarkar except in regard to the City Exchange Telephone Number. This complaint was accompanied by an affidavit not of complainant Saroj Ranjan Sarkar but of Shanti Ranjan Sarkar, his nephew. In paragraphs 1 to 7 of this affidavit he stated that the facts in regard to the Calcutta City Exchange were matters of public history as they were duly published in the columns of "statesman" dated December 29, 1948, and he also stated "that I am aware of the facts and circumstances stated above," but he did not say as to when he came to know about the City Exchange matter. It may also be noted that in the application which was made by the complainant Pramode Ranjan Sarkar in the High Court before Debabrata Mookarjee J., it was submitted that judicial notice be taken of the new 350 telephone exchange under section 57 but it was not stated as to when that complainant came to know about the new Telephone Exchange Number. That fact has been stated in the affidavit of Shanti Ranjan Sarkar in almost the same vague manner. The learned Chief Presidency Magistrate, who took cognizance of the second complaint, Mr. Bijoyesh Mookerjee, after considering the whole material placed before him issued process against the appellants only. He held that there was no delay on the part of the respondent in making the complaint that the previous complaint and the result thereof was no bar to the filing of the second complaint; that the complaint was not brought with a view to blackmail the accused including the appellants, that what the brother of the respondent did, did not lay the respondent open to the charge of blackmail. On the merits he took into consideration the fact in regard to the City Exchange of which according to the learned Magistrate he could take judicial notice under section 57 of the Evidence Act. He compared various signatures of the late N. R. Sarkar and after considering the elaborate order of his predecessor he said : "I have read and re read it and with respect too due to one of his eminence, but it is my misfortune that I have not been persuaded. There are various other considerations which point to the ineluctable prima facie conclusion of forgery. But it is not proper that I burden my order with all that at this stage." He held that he was satisfied about the truth of the allegations and there was sufficient ground for proceeding against the appellants under section 204, Criminal Procedure Code and he therefore issued process against them but did not issue any process against Dr. N. N. Law and Amiya Chakravarty who were accused Nos. 3 and 4. 351 Against this order a revision was taken by the appellants to the High Court and rule was issued against the Chief Presidency Magistrate to show cause why his order should not be set aside. He showed cause and the matter was heard by a Division Bench consisting of P. B. Mukerjee and H. K. Bose, JJ., and the matter was referred to a larger Bench because of the importance of the questions of law which arose in the case. Three questions were raised before the Special Bench, (1) whether under the appellate side rules of the High Court it was competent for a Division Bench consisting of two judges to refer any matter to a larger bench for decision in a criminal matter; (2) whether a second complaint could be entertained on the same facts after a previous complaint had been dismissed; and (3) whether the complaint could be taken cognizance of by the Magistrate in the absence of a sanction under section 196A of the Criminal Procedure Code. On all these three points the finding of the Special Bench was against the appellants. It held that the attention of the Chief Justice having been drawn to the fact that the case involved questions of importance it was open to him in the exercise of his inherent jurisdiction to refer the case to a larger bench and therefore the reference was not illegal. In regard to the filing of a second complaint it held that a fresh complaint could be entertained after the dismissal of previous complaint under section 203 Criminal Procedure Code when there was manifest error or manifest miscarriage of justice or when fresh evidence was forthcoming. The Bench was of the opinion that the fact in regard to the City Telephone Exchange was a new matter and because Pramode Ranjan Sarkar was not permitted to take a photostat copy of the Minutes Book, it was possible that his attention was not drawn to the City Telephone Exchange which was not in existence at the relevant time and that there was sufficient reason for Pramode 352 Ranjan Sarkar for not mentioning the matter of City Exchange in his complaint. It also held that the previous Chief Presidency Magistrate Mr. Chakraborty had altogether ignored the evidence of a large number of witnesses who were competent to prove the handwriting and signature of N. R. Sarkar and he had no good reasons for not accepting their evidence. It could not be said therefore that there was a judicial enquiry of the matter before the previous Chief Presidency Magistrate; the decision was rather arbitrary and so resulted in manifest miscarriage of justice. The Court was of the opinion therefore that there was no reason to differ from the finding of the Chief Presidency Magistrate Mr. Bijoyesh Mukerjee and that there was a prima facie case against the appellants. The rules were therefore discharged. It is against this judgment and that the appellants have come in appeal to this court by Special Leave. Four appeals were filed by the two appellants, two against the order of the High Court of Calcutta dismissing the revision petition and two against the order of the High Court refusing a certificate under article 134 (1) (c) of the Constitution. As this Court granted special leave against the order of the High Court dismissing the Revision Petition the two appeals against the order refusing a certificate under article 134 (1) (c) became infructuous and therefore were not pressed. It is only the appeals against the judgment and order of the High Court refusing to quash the order of the learned Chief Presidency Magistrate, Mr. Bijoyesh Mukerjee, which survive for decision. The first question to be decided and that is the most vital question in the case is, whether the second complaint filed by Saroj Ranjan Sarkar respondent should have been entertained ? This complaint was brought on April 3, 1959, the appeal in this Court brought by Pramode Ranjan Sarkar 353 the complainant in the previous complaint, having been withdrawn on March 2, 1959. The respondent holds no shares in N. R. Sarkar & Co. Ltd. He is a beneficiary under the deed of trust in trust in regard to certain number of shares. In regard to the unregistered deed of agreement appointing P. N. Taluqdar as Managing Director of N.R. Sarkar & Co. Ltd., he can have no interest. As regards the transfer deed of 1,000 shares of N. R. Sarkar & Co. Ltd., which it is claimed were entrusted to P. N. Taluqdar appellant for the benefit of the respondent and his brothers, a separate suit has been brought and is not the subject matter of the criminal complaint. There then remains the resolution of the Board dated January 16, 1948, which stands on the same footing as the appointment to Managing Directorship and is connected with that matter and relates to it. Under the Code of Criminal Procedure the subject of "Complaints to Magistrates" is dealt with in Chapter XVI of the Code of Criminal Procedure. The provisions relevant for the purpose of this case are ss.200, 202 and 203. Section 200 deals with examination of complainants and sections 202, 203 and 204 with the powers of the Magistrate in regard to the dismissal of complaint or the issuing of process. The scope and extent of sections 202 and 203 were laid down in Vadilal Panchal vs Dattatraya Dulaji Chadigaonker(1). The scope of enquiry under section 202 is limited to finding out the truth or otherwise of the complaint in order to determine whether process should issue or not and section 203 lays down what materials are to be considered for the purpose. Under section 103 Criminal Procedure Code the judgment which Magistrate has to form must be based on the statements of the complainant and of his witnesses and the result of the investigation or enquiry if any. He must apply his mind to materials and from his judgment whether or 354 not there is sufficient ground for proceeding. Therefore if he has not misdirected himself as to the scope of the enquiry made under section 202, Criminal Procedure Code, and has judicially applied him mind to the material before him and then proceeds to make his order it cannot be said that he has acted erroneously. An order of dismissal under section 203, Criminal Procedure Code, is, however, no bar to the entertainment of a second complaint on the same facts but it will be entertained only in exceptional circumstances, e.g, where the previous order was passed on an incomplete record or on a misunderstanding of the nature of the complaint or it was manifestly absurd, unjust or foolish or where new facts which could not, with reasonable diligence, have been brought on the record in the previous proceedings have been adduced. It cannot be said to be in the interests of justice that after a decision has been given against the complainant upon a full consideration of his case, he or any other person should be given another opportunity to have his complaint enquired into Allah Ditta vs Karam Baksh(1), Ram Narain Chaubey vs Panachand Jain(2), Hansabai vs Ananda(3), Doraisami vs Subramania (4). In regard to the adducing of new facts for the bringing of a fresh complaint the Special Bench in the judgment under appeal did not accept the view of the Bombay High Court or the Patna High Court in cases above quoted and adopted the opinion of Macleam, C. J. in Queen Empress vs Dolegobinda Das (5) affirmed by a full Bench in Dwarka Nath Mandal vs Benimadhab Banerji (6). It held therefore that a fresh complaint can be entertained where there is manifest error, or manifest miscarriage of justice in the previous order or when fresh evidence is forthcoming. The Chief Presidency Magistrate in the complaint filed by respondent, held that the second complaint was not unduly delayed; that section 203 is not a bar to the second complaint and that the 355 complaint was not with a view to blackmail the persons accused. On the merits he held that the minutes of the proceedings of January 16, 1948 were typed on a sheet of paper with Telephone No. "City 6091" and the City Exchange case into existence later in the year and that on his comparing the signatures of N. R. Sarkar it appeared that the signature was a forgery. He said: "And governing myself by this test, I held that forgery is there prima facie and only prima facie. " These then were to facts on which the learned Presidency Magistrate Mr. B. Mukherjee came to a conclusion different from that of his predecessor Mr. Chakravorti, who had inquired into the complaint of Pramode Ranjan Sarkar, as to the forged nature of the signatures of Mr. N. R. Sarkar. Taking first the question of fresh evidence, the view of some of the High Courts that it should be such that it could not with reasonable diligence have been adduced is, in our opinion, a correct view of the law. It cannot be the law that the complainant may first place before the Magistrate some of the facts and evidence in his possession and if he fails he can then adduce some more evidence and so on. That in our opinion, is not a correct view of the law. The next point to be considered is, was the mention of the telephone number "City 6091" on the note paper on which the resolution was typed a matter of which the previous complainant Pramode Ranjan Sarkar was unaware and was it a fact which with reasonable diligence he could not place before the Magistrate. In the complaint filed by Pramode Ranjan Sarkar no reference was made to the City Exchange. It is true that the question was sought to be raised as a fresh piece of evidence before Debabrata Mookerjee, J. and it was not 356 considered by him but it was not stated before him when the then complainant came to know of this fact. According to a copy of the Day Book entry by Mr. Bimal Chandra Chakravarty, Solicitor for the previous complainant Pramode Ranjan Sarkar, dated October 13, 1953, photostat copies were taken of the share transfer deed and portions of the agreement dated January 19, 1948 and inspection of the Minutes Book was also taken but the request of the complainant to take photostat copies of certain resolutions was refused, by the appellant section M. Basu. It is significant that according to this entry, Santi Ranjan Sarkar was acting as the agent of Pramode Ranjan Sarkar and was present at the time of the inspection. After this inspection was taken, Pramode Ranjan Sarkar discussed with his Legal Advisers the peculiarities noted in the impugned documents. This is what he (Pramode Ranjan Sarkar) stated as a witness before the Chief Presidency Magistrate. His evidence also shows that he inspected the Minutes Book though after much "recriminations." Witness Shibakali Bagchi stated that Minutes Book of N. R. Sarkar & Co. Ltd., was examined by him and that it appeared to him that the book was not genuine and Pramode Ranjan Sarkar complained that some of the signatures were forged. It appears from the statement of Pramode Ranjan Sarkar that the appellant section N. Basu, did not let them take photographs of some of the pages of the Minutes Book. It is not stated by either Bagchi or Pramode Ranjan Sarkar of what documents they wanted to take photographs which were refused. In the statement of Bimal Chandra Chakrabarty, the Solicitor, the same statement is made i. e, they wanted to take photographs of some documents which were not allowed to be taken. The correspondence produced by Pramode Ranjan Sarkar in his complaint proceedings shows that the Minutes Book was produced for his inspection and was inspected. Debabrata Mookarjee, J., in dealing with the 357 resolution of January 16, 1948, said that it was not possible on the materials available considered prima facie that the Magistrate 's finding suffered from such a grave impropriety as to require interference by the Court. He was of the opinion that the complainant could not have been unaware of the resolution of January 16, 1948. This he concluded from the following; that on his own case Pramode Ranjan managed the affairs of the Company along with the appellant P. N. Taluqdar; that although the proceedings of the Board dated September 22, 1953, referred to the resolution of January 16, 1948 yet the only protest made against it by Pramode Ranjan Sarkar was the alleged legal difficulties consequent on renewal of the appointment but its genuineness was not then questioned and it was questioned for the first time on March 17, 1954, when the complaint was lodged. Against the judgment and order of Debabrata Mookerjee J., Special Leave to appeal to this Court was obtained and one of the points taken in the application was that the resolution was typed on a sheet of paper bearing Telephone No. City 6091 although this Telephone Exchange did not come into existence till December 28, 1948. It is significant that Pramode Ranjan Sarkar did not mention when he came to know about the existence of this new fact. It was not, therefore, made clear to the learned Judge at least upto that stage as to when, before or after the filing of the first complaint Pramode Ranjan Sarkar came to know about the existence of this piece of evidence to which so much importance is attached. Debabrata Mookerjee, J., also said in his judgment that the affairs of the Company were managed by Pramode Ranjan Sarkar and the appellant P. N. Taluqdar and that it was difficult to believe that he (Pramode Ranjan) had no access to the Minutes Book which showed that he himself 358 had presided over several meetings and also that there was nothing extraordinary about the proceedings being typed on separate sheets of paper and the sheets of paper being pasted in that Minutes Book because on some of them there were his own signatures and it was, difficult to believe that tampering with the records went on "systematically" for several months without Pramode Ranjan Sarkar having seen the book or detected the tampering. It was, therefore, impossible to blame the previous Chief Presidency Magistrate if he held in those circumstances that there was no forgery in the Minutes Book or tampering with it. The following passage from the learned Judge 's judgment is significant: "Photographs of the impugned documents were taken on the 13th October when the Minutes Book was inspected. On the last mentioned date the complainant was certain about the entire book having been tampered with; but nothing appears to have been said about it, no challenge made, no protest entered until full five months passed when at last the silence was broken and the complaint was lodged on the 17th March, 1954. It is of course not known what was said about it in the information to the police. These circumstances are explicit in the complainant 's case. That case has only to be presented for these features to be seen, and the Magistrate could not possible have overlooked them. His clear finding is that the Minute Book is genuine. I am not in a position to say it is improper on a prima facie consideration of the evidence offered. " Dealing with the question whether the signatures of N. R. Sarkar were forged, the learned Judge agreed after considering the whole evidence that the signatures were not forged. 359 The complaint of the present complaint Saroj Rajan Sarkar specifically mention the City Exchange and that it came into existence later. He also alleges that this fact was not known to the previous complaint, Pramode Ranjan Sarkar, and in support there is the affidavit of Santi Ranjan Sarkar. Significantly enough in that affidavit also it is not stated as to when the deponent came to know about this alleged new fact of the Telephone City Exchange. All that the affidavit says is that it is a matter of history and was published in the Statesman of December 29, 1948. There is no evidence on the record to show as to when the matter of "City Exchange" came to be known to the persons who were then and two those who are now prosecuting the criminal complaints. The document which we have referred to above i.e., the letter written by the Solicitor dated October 13, 1953 shows that Santi Ranjan Sarkar was present as agent of Pramode Ranjan Sarkar at the time of the inspection. The complaint filed by Saroj Ranjan Sarkar states: "That with great difficulty the documents in question were inspected, certified true copies of the alleged resolutions of the Board meetings were obtained and photostatic copies of material portions including alleged signatures of late Sri Sarkar on the said Deed of Agreement and on the Deed of Transfer could be obtained, as will appear from correspondence in this respect. " In the complaint filed by Pramode Ranjan Sarkar exactly the same language was used in paragraph 10 of the previous complaint. If certified copies were obtained by the complainant Pramode Ranjan Sarkar and inspection was taken by Santi Ranjan Sarkar for Pramode Ranjan Sarkar and by his Solicitor and the facts are as they are 360 stated above, it is difficult to hold that the fact in regard to the City Exchange was not know to the complainant in the first complaint and was a new fact which could not, with reasonable diligence, be adduced by him. The next question which arises is whether the order of the previous Chief Presidency Magistrate who decided Pramode Ranjan 's complaint, was manifestly absurd or unjust and resulted in a manifestly unjust order. The Special Bench of the High Court has held that it was so because (1) the Magistrate ignored the evidence of a large number of witnesses who were competent to prove the handwriting and signature of the late Mr. N. R. Sarkar; (2) he "set aside" the report of the enquiring Magistrate, Mr. A.B. Syam for reasons which cannot be held to be proper and judicial reasons; (3) He said in his order that Mr. N. R. Sarkar might himself have ante dated the documents thus accepting a possible defence for which there was no basis before him; and (4) he relied upon his own comparison of the disputed signatures of Mr. N. R. Sarkar. On these grounds the Special Bench was of the opinion that the decision of the first Magistrate was rather arbitrary and so resulted in manifest miscarriage of justice. The question is whether Mr. N. C. Chakrabarti, the previous Presidency Magistrate had applied his mind to the evidence which was produced before him and keeping in view his functions as a Magistrate, he gave his decision. It is not necessary to refer to the various findings given by him. Thy are set out and considered in the judgment of Debabrata Mookerjee, J. and he (that learned Judge) has commented upon all the infirmities in that order which were brought to his notice. The previous Chief Presidency Magistrate found that the Deed of Agreement dated January 19, 1948 was not a forged document. He referred 361 to the evidence without analyzing it. He said that the complainant examined persons who know the signature of the late Nalini Ranjan Sarkar and they deposed as to the manner in which Nalini Ranjan Sarkar used to sign. After making a reference to the gist of the evidence submitted before him and to the report of Mr. A. B. Syam, Presidency Magistrate, he (the learned Chief Presidency Magistrate) came to the conclusion: "For the reasons above, I find that the evidence on handwriting including the opinion of the Handwriting Expert does not support the complainant 's version. " Again in a later part of his order he found that the resolution of the Board of Directors dated January 16, 1948 also was not forged and that the endorsement of the appellant section M. Basu, was nothing more or less then the authentication of the common seal of the Co., and he, therefore, agreed with the finding of Mr. A.B. Syam that there was no case against section M. Basu, appellant but disagreed with him in regard to the other appellant, P. N. Talukdar. When the matter went to the High Court, Debabrata Mookerjee, J., first considered as to when the revisional power of Court to interfere should be exercised. Then he discussed the seven circumstances which were relied upon by the then complainant Promode Ranjan Sarkar in support of the allegations of forgery. After dealing with these various points raised he held: "It may be that one or two items of evidence were not specifically referred to in the Order but that does not necessarily imply that those items of evidence were not present to the mind of the Magistrate. After all a Magistrate is only required to record briefly his reasons for dismissing 362 a complaint. The Magistrate 's order, I think, is fairly well. " The learned Judge then discussed the question of delay and held that Pramode Ranjan Sarkar had considerably delayed the bringing of the complaint. He also held that the Deed of Agreement which was alleged to be a forgery had not been so proved and he gave various reasons, one of them being that at the meeting of the Board of Directors dated September 22, 1953, the then complainant did not oppose the renewal on the ground that the Agreement was forged or did not exist, but on legal grounds. Then the learned Judge referred to the correspondence which had passed between the then complainant Pramode Ranjan Sarkar and the appellant P.N. Talukdar and said: "It is therefore clear that the evidence which the complainant offered in support of his case contained prima facie on the first aspect sufficient materials for distrusting the truth of the story and I cannot see how the Magistrate 's order can be challenged in revision on the ground of impropriety as respects the Deed of Agreement. The learned Judge then referred to other aspects of the case i.e., the evidence of the Deputy Controller of Stationery, P.W. 15. He also referred to finding of the previous Chief Presidency Magistrate that it was difficult to believe that the complainant should have been unaware of the resolution of January 16, 1948 and after referring to all these various questions raised, he dismissed the petition. Can it be said in these circumstances that there has been a manifest error resulting in the passing of an unjust order ? That in our opinion, has not been made out. The order of Debabrata Mookerjee J., who reviewed the findings of the previous Chief Presidency Magistrate, shows that the criticism that that the learned Magistrate did not 363 consider the whole evidence is not justified. Taking the evidence into consideration he came to the conclusion that there was no ground to proceed and, therefore, refused to issue process. In his opinion the evidence was not worthy of credit and he was not satisfied with the correctness of the complaint and dismissed it as he was entitled to do on those findings. See Gulab Khan vs Gulam Mohammad Khan (1) which was approved in Vadilal Panchal v Dattatraya Dulaji Chadigaonker(2). In the circumstances the order made by the previous Chief Presidency Magistrate was not any manner manifestly absurd unjust or foolish, nor can it be said that the Magistrate ignored in any principles which were necessary to apply under sections 202 and 203 of the Criminal Procedure Code nor is the order contrary to what was said in Ramgopal Ganpatrai Ruia vs State of Bombay (3). That was a case in which the rule in regard to the commitment proceedings and the power of the Committing Magistrate to commit was discused and the expression "sufficient grounds" in sections 209, 210 and 213 of the Code of Criminal Procedure was interpreted. That was not a case dealing with the powers of the Magistrate under sections 202 and 203 which was specifically raised and decided in Vadilal Panchal 's case (3). In Ramgopal Ganpatrai Ruia 's case (3) the following observations of Sinha J., (as he then was) in regard to the expression "sufficient grounds" are pertinent: "The controversy has centred round interpretation of the words "sufficient ground", occurring in the relevant sections of the Code, set out above. In the earliest case of Lachman vs Juala All. 161, decided by Mr. Justice Mahmood in the Allahabad High Court, governed by section 195 of the Criminal Procedure Code of 364 1872 (Act No. X of 1872), the eminent judge took the view that the expression "sufficient grounds" has to be understood in a wide sense including the power of the magistrate to weigh evidence. In that view of the matter, he ruled that if in the opinion of the magistrate, the evidence against the accused "cannot possibly justify a conviction" there was nothing in the Code to prevent the Magistrate from discharging the accused even though the evidence consisted of statements of witnesses. who claimed to be eye witnesses, but whom the magistrate entirely discredited. He also held that the High Court could interfere only if it came to the conclusion that the Magistrate had committed a material error in discharging the accused or had illegally or improperly underrated the value of the evidence. Thus, he overruled the contention raised on behalf of the prosecution that the powers of the committing Magistrate did not extent to weighing the evidence and that the expression "sufficient ground" did not include the power of discrediting eye witnesses. Though the Code of Criminal Procedure was several times substantially amended after the date of that decision, the basic words "sufficient grounds" have continued throughout. That decision was approved by a Division Bench of the Bombay High Court In re Bai Parvati Bom. 163 and the observations aforesaid in the Allahabad decision were held to be an accurate statement of the law as contained in section 201 of the Code, as it now stands. The High Court of Bombay held in that case where the evidence tendered for the prosecution is 365 totally unworthy of credit, it is the duty of the Magistrate to discharge the accused. It also added that where the magistrate entertains any doubt as to the weight or quality of the evidence, he should commit the case to the Court of Session which is the proper authority to resolve that doubt and to assess the value of that evidence." Debabrata Mookerjee J., in the revision against the order of the previous Chief Presidency Magistrate accepted the finding of that Magistrate in regard to the delay. The present complaint out of which this appeal has arisen was filed after the appeal in this Court arising out of this complaint was withdrawn by Pramode Ranjan Sarkar. Can it be said that this is not an abuse of the process of tho Court one brother who was a director of the Company and who would be interested in the Managing Directorship of the Company and the resolutions passed in regard to that office, brought a complaint in 1954 which was dismissed both by the Magistrate and the High court. Appeal against the order of dismissal brought in this court was withdrawn on March 12, 1959. It was alleged in his complaint by Pramode Ranjan Sarkar that the present respondent was celluding with appellant, P. N. Talukdar, who had offered his some kind of monetary inducement and that fact was deposed to by the present respondent himself as a witness in the previous complaint. He waited all this time although he knew about the forged signatures of his late brother on various documents and after at least the lapse of five years he brought a fresh complaint on the same facts. Neither he has disclosed as to when he came to know about the City Exchange nor have Santi Ranjan Sarkar and Pramode Ranjan Sarkar, which cannot therefore be said to be a fact which could not with reasonable diligence be adduced at the time of the previous complaint. 366 The argument that this Court gave Special Leave in the case of Pramode Ranjan Sarkar and therefore there were points of importance is, in the circumstances of this case, a neutral circumstance and that fact cannot be used as a point in favour of the respondent. In these circumstances, we are of the opinion that the bringing of the fresh complaint is a gross abuse of the process of the Court and is not with the object of furthering the interests of justice. In regard to the power of reference to a larger Bench, we are in agreement with section K. Das, J, and in the circumstances it is unnecessary to express an opinion as to the applicability of section 196A Criminal Procedure code to the facts of this case. For these reasons we allow the appeals, set aside the order of the High Court and of the learned Chief Presidency Magistrate and dismiss the complaint. BY COURT: In accordance with the judgment of the majority, the appeal is allowed. Appeal allowed.

On March 17, 1954, Promode Ranjan a brother of N. R. Sarkar filed a complaint under section 200 Code of Criminal Procedure against Pramathanath and section M. Basu alleging offences punishable under sections 467, 471 and 109 of the Indian Penal Code, before the Chief Presidency Magistrate in respect of a document appointing Pramathanath as the Managing Director of N. R. Sarkar & Co. and the minutes of the Board meeting resolving the same. It was alleged therein that the signatures of N. R. Sarkar on those documents were forgeries. After considering the evidence of the Handwriting Expert the Magistrate dismissed the complaint. Promode Ranjan preferred a revision petition to the High Court. The High Court dismissed the revision Petition. By an application dated January 6, 1956, when the revision petition was pending, attention of the High Court was drawn to the fact that the minutes dated January 16, 1948, had been typed on a letter bearing at the top in print "Telephone City 6091" where as the City Exchange had not come into existence till December 1948. The Supreme Court granted special leave against the dismissal of the revision petition by the High Court but the appeal was withdrawn. On April 3, 1959, Saroj Ranjan, another brother of N.R. Sarkar, laid a complaint on the same facts and allegations 298 against the appellants, in addition alleging the further fact about the City Exchange in support of the allegation that the minutes were forged dishonestly and fraudulently and used as genuine. Neither in this complaint nor before the High Court had it been stated as to when it came to be known that on the purported date of the minutes the City Exchange was not in existence. The Presidency Magistrate issued process against the appellants. The appellants went up in revision to the High Court. The matter was first heard by a Division Bench and was later referred to a larger Bench of three Judges which dismissed the revision petition. In these appeals on special leave it was contended by the appellants that the second complaint ought not to have been entertained, that the constitution of the special Bench was illegal and that as the complaint alleged criminal conspiracy sanction under section 196A of the Code of Criminal Procedure was required. ^ Held, that the enquiry contemplated by sections 200 to 204 Code of Criminal Procedure is for the purpose of enabling the Magistrate to find out if sufficient grounds exist for issuing process. Vadilal Panchal vs Daltaraja Dulaji Chandigaonkar, , Gulab Khan vs Gulab Mohammad Khan A.I.R. 1927 Lah. 30 and Ram Gopal Ganpat Ruia vs State of Bombay, referred to. Per section K. Das, J. The law does not prohibit altogether the entertainment of a second complaint when a previous complaint on the same allegations has been dismissed under section 203 of the Code of Criminal Procedure. But a second complaint containing more or less the same allegations can be entertained only in exceptional circumstances. It is not possible nor desirable that the exceptional circumstances must be stated with particularity or precision. Generally speaking, the exceptional circumstances may be classified under three categories: (1) manifest error in the earlier proceeding, (2) resulting miscarriage of justice, and (3) new facts which the complainant had no knowledge of or could not with reasonable diligence have brought forward in the previous proceedings. Where the previous order of dismissal was passed on an incomplete record or on a misunderstanding of the nature of the complaint, a second complaint may be entertained. Where a Magistrate misdirects himself as to the scope of an enquiry under s 202, Code of Criminal Procedure, and the mistake, made gives a wrong direction to the whole proceeding on the first complaint, the order of dismissal passed thereon would be due. to a manifest error resulting in a miscarriage of justice. In such a case, a second complaint is entertainable. 299 Per Kapur and Hidayatullah, JJ. There is no legal bar to the entertainability of a second complaint. It is only when the Magistrate had misdirected himself, with regard to the scope of the enquiry under section 203, Code of Criminal Procedure, or has passed an order misunderstanding the nature of the complaint or the order is manifestly unjust or absurd or the order is based on an incomplete record can it be said that there is such a manifest error or a manifest miscarriage of justice that a second complaint on the same allegations may be entertained. The other exceptional circumstances in which a second complaint may be entertained is when it is supported by fresh and further evidence. Case law referred to. In the case of fresh evidence it must be such as could not have been with due diligence on the part of the complaint adduced on the earlier occasion. Queen Empress vs Dole Gobinda Das I.L.R , Dwarkanath Mandal vs Daniradha banerjee, I.L.R. disapproved. Allah Ditta vs Karam Bakshi, Ram, Narain Chowdhary vs Punachand Jain, AIR 1949 Pat. 255, Hansabai vs Ananda, A.I.R. 1949 Bom. 384 and Doraiswami vs Subramania, A I. R. , approved. In the present case permitting the second complaint to proceed would be a gross abuse of process. Held, further, concurring with S.K. Das, J., that the Special Bench was properly constituted. Per section K. Das, J. On the first complaint the Presidency Magistrate had misdirected himself regarding the scope of the enquiry under sections 203 and 204 of the Code of Criminal Procedure and it was a manifest error. The facts about the City Exchange urged and fresh evidence were decisive of a prima facie case for issuing process and it was an exceptional circumstance justifying entertaining the second complaint and not to permit the trial of the case in such circumstances would be a denial of justice. Kumariah vs C. Naicker, A.I.R. 1946 Mad, 167 and Ramanand vs Sheri, I.L.R. 1. 56 All 425, referred to. Though Chapter II of the Rules of the High Court (Appellate Side) in terms applies to Civil cases, their substance could be applied to criminal cases by the Chief Justice in constituting a larger bench. The substance of the allegations in the complaint amounted to an offence of abetment by conspiracy under 300 section 107 Indian Penal Code and not the offence of Criminal Conspiracy as defined by section 120A and therefore sanction under section 196A of the Code of Criminal Procedure was not necessary. The distinction between the two offences lies in that the first requires an overt act in pursuance of the agreement whereas the second makes the agreement to do the unlawful act itself punishable. Basirul Hag vs State of West Bengal and Mulachy vs The Queen, , referred to.

Civil Appeal No. 207 of 1956. Appeal from the judgment and decree dated November 5, 1952, of the Madras High Court in Appeal No. 852 of 1948. R. Thiagarajan and G. Gopalakrishnan, for the appellant. Ganapathy Iyer, for respondent No. 3. 1962. January 11. The Judgment of the Court was delivered by VENKATARAMA AIYAR, J. This is an appeal against the Judgment of the High Court of Madras, dismissing the suit filed by the appellant, as Muthavalli of the Jumma Masjid, Mercara for possession of a half share in the properties specified in the plaint. The facts are not in dispute. There was a joint family consisting of three brothers, Santhappa, Nanjundappa and Basappa. Of these, Santhappa died unmarried, Basappa died in 1901, leaving behind a widow Gangamma, and Najundappa died in 1907 leaving him surviving his widow Ammakka, who succeeded to all the family properties as his heir. On the death of Ammakka, which took place in 1910, the estate devolved on Basappa, Mallappa and Santhappa, the sister 's grandsons of 557 Nanjundappa as his next reversioners. The relationship of the parties is shown in the following genealogical table. Basappa | | | | | Santhappa Nanjundappa Basappa Mallammal d. 1907 d. 1901 | =Ammakka =Gangamma | d.1910 | | Ramegowda Mallegowda | | | | | | Basappa Mallappa Santhappa On August 5, 1900, Nanjundappa and Basappa executed a usufructuary mortgage over the properties which form the subject matter of this litigation, and one Appanna Shetty, having obtained an assignment thereof, filed a suit to enforce it, O.S. 9 of 1903, in the court of the Subordinate Judge, Coorg. That ended in a compromise decree, which provided that Appanna Shetty was to enjoy the usufruct from the hypotheca till August, 1920, in full satisfaction of all his claims under the mortgage, and that the properties were thereafter to revert to the family of the mortgagors. By a sale deed dated November 18, 1920, exhibit III, the three reversioners, Basappa, Nallappa and Santhappa, sold the suit properties to one Ganapathi, under whom the respondents claim, for a consideration of Rs. 2,000. Therein the vendors recite that the properties in question belonged to the joint family of Nanjundappa and his brother Basappa, that on the death of Nanjundappa, Ammakka inherited them as his widow, and on her death, they had devolved on them as the next reversioners of the last male 558 owner. On March 12, 1921, the vendors executed another deed, exhibit IV, by which exhibit III was rectified by inclusion of certain items of properties, which were stated to have been left out by oversight. It is on these documents that the title of the respondents rests. On the strength of these two deeds, Ganapathi sued to recover possession of the properties comprised therein. The suit was contested by Gangamma, who claimed that the properties in question were the self acquisitions of her husband Basappa, and that she, as his heir, was entitled to them. The Subordinate Judge of Coorg who tried the suit accepted this contention, and his finding was affirmed by the District Judge on appeal, and by the, Judicial Commissioner in second appeal. But before the second appeal was finally disposed of, Gangamma died on February 17, 1933. Thereupon Ganapathi applied to the revenue authorities to transfer the patta for the lands standing in the name of Gangamma to his own name, in accordance with the sale deed exhibit III. The appellant intervened in these proceedings and claimed that the Jumma Masjid, Mercara, had become entitled to the properties held by Gangamma, firstly, under a Sadakah or gift alleged to have been made by her on September 5, 1932, and, secondly, under a deed of release executed on March 3, 1933, by Santhappa, one of the reversioners, relinquishing his half share in the properties to the mosque for a consideration of Rs. 300. By an order dated September 9, 1933, exhibit II, the revenue authorities declined to accept the title of the appellant and directed that the name of Ganapathi should be entered as the owner of the properties. Pursuant to this order, Ganapathi got into possession of the properties. The suit out of which the present appeal arises was instituted by the appellant on January 2, 1945, for recovery of a half share in the properties that 559 had been held by Gangamma and for mesne profits. In the plaint, the title of the appellant to the properties is based both on the gift which Gangamma is alleged to have made on September 5, 1932, and on the release deed executed by Santhappa, the reversioner, on March 3, 1933. With reference to the title put forward by the respondents on the basis of exhibit III and exhibit IV, the claim made in the plaint is that as the vendors had only a spes succession is in the properties during the lifetime of Gangamma, the transfer was void and conferred no title. The defence of the respondents to the suit was that as Santhappa had sold the properties to Ganapathi on a representation that he had become entitled to them as reversioner of Nanjundappa, on the death of Ammakka in 1910, he was estopped from asserting that they were in fact the self acquisitions of Basappa, and that he had, in consequence, no title at the dates of exhibit III and exhibit IV. The appellant, it was contended, could, therefore, get no title as against them under the release deed exhibit A, dated March 3, 1933. The District Judge of Coorg who heard the action held that the alleged gift by Gangamma on September 5, 1932, had not been established, and as this ground of title was abandoned by the appellant in the High Court, no further notice will be taken of it. Dealing next with the title claimed by the appellant under the release deed, exhibit A executed by Santhappa, the District Judge held that as Ganapathi had purchased the properties under exhibit III on the faith of the representation contained therein that the vendors had become entitled to them on the death of Ammakka in 1910, he acquired a good title under section 43 of the , and that exhibit A could not prevail as against it. He accordingly dismissed the suit. The plaintiff took the matter in appeal to the High Court, Madras, and in view of the conflict of authorities on the question in that Court, the case was refer 560 red for the decision of a Full Bench. The learned Judges who heard the reference agreed with the court below that the purchaser under exhibit III had, in taking the sale, acted on the representation as to title contained therein, and held that as the sale by the vendors was of properties in which they claimed a present interest and not of a mere right to succeed in future, section 43 of the applied, and the sale became operative when the vendors acquired title to the properties on the death of Gangamma on February 17, 1933. In the result, the appeal was dismissed. The appellant then applied for leave to appeal to this Court under article 133(1)(c), and the same was granted by the High Court of Mysore to which the matter had become transferred under section 4 of Act 72 of 1952. That is how the appeal comes before us. The sole point for determination in this appeal is, whether a transfer of property for consideration made by a person who represents that he has a present and transferable interest therein, while he possesses, in fact, only a spes successionis, is within the protection of section 43 of the . If it is, then on the facts found by the courts below, the title of the respondents under exhibit III and exhibit IV must prevail over that of the appellant under exhibit A. If it is not, then the appellant succeeds on the basis of Ex A. Section 43 of the runs as follows: "Where a person fraudulently or erroneously represents that he is authorised to transfer certain immovable property and professes to transfer such property for consideration such transfer shall, at the option of the transferee, operate on any interest which the transferor may acquire in such property at any time during which the contact of transfer subsists. 561 Nothing in this section shall impair the right of transferees in good faith for consideration without notice of the existence of the said option. " Considering the scope of the section on its terms, it clearly applies whenever a person transfers property to which he has no title on a representation that he has a present and transferable interes therein, and acting on that representation, the transferee takes a transfer for consideration. When these conditions are satisfied, the section enacts that if the transferor subsequently acquires the property, the transferee becomes entitled to it, if the transfer has not meantime been thrown up or cancelled and is subsisting. There is an exception in favour of transferees for consideration in good faith and without notice of the rights under the prior transfer. But apart from that, the section is absolute and unqualified in its operation. It applies to all transfers which fulfil the conditions prescribed therein, and it makes 1. O difference in its application, whether the defect of title in the transferor arises by reason of his having no interest whatsoever in the property, or of his interest therein being that of an expectant heir. The contention on behalf of the appellant is that section 43 must be read subject to section 6 (a) of the which enacts that, "The chance of an heir apparent succeeding to an estate, the chance of a relation obtaining a legacy on the death of a kinsman or any other mere possibility of a like nature, cannot be transferred. " The argument is that if section 43 is to be interpreted as having application to Cases of what are in fact transfers of spes successionis, that will have the effect of nullifying section 6 (a), and that therefore it would be proper to construe section 43 as limited to cases of transfers other than those falling within . In effect, this argument involves importing 562 into the section a new exception to the following effect; "Nothing in this section shall operate to confer on the transferee any title, if the transferor had at the date of the transfer an interest of the kind mentioned in section 6 (a). " If we accede. to this contention we will not be construing s.43. but rewriting it. "We are not entitled", observed Lord Loreburn L. C., in Vickers vs Evans (1), "to read words into an Act of Parliament unless clear reason for it is to be found within the four corners of the Act itself." Now the compelling reason urged by the appellant for reading a further exception in section 43 is that if it is construed as applicable to transfers by persons who have only spes successionis at the date of transfer, it would have the effect of nullifying section 6(a). But section 6(a) and section 4 relate to two different, subjects, and there is no necessary conflict between them; Section 6 (a) deals with certain kinds of interests in property mentioned therein, and prohibits a transfer simpliciter of those interests. Section 43 deals with representations as to title made by a transferor who had no title at the time of transfer, and provides that the transfer shall fasten itself on the title which the transferor subsequently acquires. Section 6 (a) enacts a rule of substantive law, while section 43 enacts a rule of estoppel which is one of evidence. The two provisions operate on different fields, and under different conditions, and we see no ground for reading a conflict between them or for outing down the ambit of the one by reference to the other. In our opinion, both of them can he given full effect on their own terms, in their respective spheres. To hold that transfers by persons who have only a spes successionis at the date of transfer are not within the protection afforded by section 43 would destroy its utility to a large extent. It is also contended that as under the law there can be no estoppel against a statute transfers 563 which are prohibited by section (6a) could not be held to be protected by section 43. There would have been considerable force in this argument if the question The fell to be decided solely on the terms of section 6 (a). Rules of estoppel are not to be resorted to for defeating or circumventing prohibitions enacted by Statutes on grounds of public policy. But here the matter does not rest only on section 6 (a). We have in addition, section 43, which enacts a special provision for the protection of transferees for consideration from persons who represent that they have present title, which, in fact, they have not. And the point for decision is simply whether on then facts the respondents are entitled to the benefit of this section. If they are, as found by the courts below, then the plea of estoppel raised by them on the terms of the section is one pleaded under, and not against the statute, The appellant also sought to rely on the decisions wherein it has been held that a plea of estoppel could not be raised against a millor who had transferred property on a representation that he was of age, and that section 43 was inapplicable to such transfers, vide Sadiq Ali Khan vs Jai Kishori Gadigeppa vs Balanagauda (2) Ajudhia Prasad vs Chandan Lal(3)But the short answer to this contention is that section 43 deals with transfers which fail forwant of title in the transferor and not want of capacity in him at the time of transfer. It may further be observed in this connection that the doctrine of estoppel has been held to have no application to persons who have no contractual capacity where the claim is based on contract, vide Mahomed Syedol Ariffin, vs Yeoh Oai Gark (4); Levine vs Brougham (5), Leslie Ltd. section Sheil); Khan Gul vs Lakha Singh (7). Decisions on transfers by minors therefore are of no assistance in ascertaining the true scope of section 43. 564 So far we have discussed the question on the language of the section and on the principles applicable thereto. There is an illustration appended.to section 43, and we have deferred consideration thereof to the last as there has been a controversy as to how far it is admissible in construing the section. It is as follows: "A, a Hindu, who has separated from his father B, sells to C three fields, X, Y and Z, representing that A is authorized to transfer the same. Of these fields Z does not belong to A, it having been retained by B on the partition; but on B 's dying A as heir obtains Z. C, not having rescinded the contract of sale, may require A to deliver Z to him. In this illustration, when A sold the field Z to C, he had only a spes successionis. But he having subsequently inherited it, became entitled to it. This would appear to conclude the question against the appellant. But it is argued that the illustration is repugnant to the section and must be rejected. If the language of the section clearly excluded from its purview transfers in which the transferor had only such interest as is specified in section 6(a), then it would undoubtedly not be legitimate to use the illustration to enlarge it. But far from being restricted in its scope as contended for by the appellant, the section is, in our view, general in its terms and of sufficient amplitude to take in the class of transfers now in question. Its is not to be readily assumed that all illustration to a section is repugnant to it and rejected. Reference may, in this connection, be made to the following observations of the judicial Committee in Mahomed Shedol Ariffin vs Yeoh Ooi Gark (1) as to the value to given to illustrations appended to a section, in ascertaining its true scope: 565 "It is the duty of a court of law to accept, if that can be done, the illustrations given as being both of relevance and value in the construction of the text. The illustrations should in no case be rejected because they do not square with ideas possibly derived from an other system of jurisprudence as to the law with which they are the sections deal And it would require a very special case to warrant their rejection on the ground of their assumed repugnancy to the sections themselves. It would be the very last resort of construction to make any such assumption. The great usefulness of the illustrations, which have, although no part of the sections, been expressly furnished by the Legislature as helpful in the working and application of the statute, should not be thus impaired. " We shall now proceed to consider the more important cases wherein the present question has been considered. One of the earliest of them is the decision of the Madras High court in Alamanaya Kunigari Nabi Sab vs Murukuti Papiah (1). That arose out of a suit to enforce a mortgage executed by the son over properties belonging to the father while he was alive. The father died pending the suit, and the properties devolved on the son as his heir. The point for decision was whether the mortgagee could claim the protection of section 43 of the . The argument against is was that "section 43 could not be so construed as to nullify section 6(a) of the , by validating a transfer initially void under s 6(a)". In rejecting this contention, the Court observed: "This argument, however, neglects the distinction between purporting to transfer `the chance of an heir apparent, ' and `erroneously representing that he (the transferor) is 566 authorised to transfer certain immoveable property. " It is the latter course that was followed in the present case. It was represented to the transferee that the transferor was in praesenti entitled to and thus authorise to transfer the property." (p. 736) On this reasoning if a transfer is statedly of an interest of the character mentioned in section 6(a), it would be void, whereas, if it purports to be of an interest in praesenti, it is within the protection afforded by section 43 Then we come to the decision in The official Assignee, Madras vs Sampath Naidu (1), where a different view was taken. The facts were that one vs Chetti had executed two mortgages over properties in respect of which he had only spes successionis. Then he succeeded to those properties as heir and then sold them to one Ananda Mohan. A mortgagee claiming under Ananda Mohan filed a suit for a declaration that the two mortgages created by Chetty before he had become entitled to them as heir, were void as offending section 6(a) of the . The mortgagee contended that in the events that had happened the mortgages had become enforceable under section 43 of the Act. The Court negatived this contention and held that as the mortgages, when executed, contravened section 6(a), they could not become valid under section 43. Referring to the decision in Alamanaya Kunigari Nabi Sab vs Murkuti Papiah (2), the Court observed that no distinction could be drawn between a transfer of what is on the face of it spes successionis, and what purports to be an interest in praesenti. "If such a distinction were allowed", observed Bardswell, J., delivering the Judgment of the Court, "the effect would be that by a clever description of the property dealt with in a deed of transfer one would be allowed to conceal the real nature of the transaction and evade a clear statutory prohibition. " 567 This reasoning is open to the criticism that it ignores the principle underlying section 43. That section embodies, as already stated, a rule of estoppel and enacts that a person who makes a representation shall not be heard to allege the contrary as against a person who acts on that representation. It is immaterial whether the transferor acts bona fide or fraudulently in making the representation. It is only material to find out whether in fact the transferee has been misled. It is to be noted that when the decision under consideration was given, the relevant word of section 43 were, "where a person erroneously represents", and now, a amended by Act 20 of 1929, they are "where a person fraudulently or erroneously represents", and that emphasises that for the purpose of the section it matters not whether the transferor act fraudulently or innocently in making the representation, and that what is material is that he did made representation and the transferee has acted on it. Where the transferee knew as a fact that the transferor did not possess the title which he represents he has, then he cannot be said to have acted on it when taking a transfer. Section 43 would then have no application, and the transfer will fail under section 6(a). But where the transferee does act on the representation, there is no reason why he should not have the benefit of the equitable doctrine embodied in section 43, however fraudulent the act of the transferor might have been. The learned Judges were further of the opinion that in view of the decision of the Privy Council in Ananda Mohan Roy vs Gour Mohan Mullick (1) and the decision in Sri Jagannada Raju vs Sri Rajah Prasada Rao (2), which was approved therein, the illustration to section 43 must be rejected as repugnant to it. In Sri Jagannada Raju 's case (2), the question was whether a contract entered into by certain 568 presumptive reversioners to sell the estate which was then held by a widow as heir could be specifically enforced, after the succession had opened. It was held that as section 6(a) forbade transfers of spes successionis, contracts to make such transfers would be void under section 23 of the contract Act, and could not be enforced. This decision was approved by the Privy Council in Ananda Mohan Roy vs Gour Mohan Mullick(1), where also the question was whether a contract by the nearest reversioner to sell property which was in the possession of a widow as heir was valid and enforceable, and it was held that the prohibition under section 6(a) would became futile, if agreements to transfer could be enforced. These decisions have no bearing on the question now under consideration, as to the right of a person who for consideration takes a transfer of what is represented to be an interest in praesenti. The decision in The Official Assinee, Madras vs Sampatha Naidu (2) is, in our view, erroneous, and was rightly over ruled in the decision now under appeal. Proceeding on to the decisions of the other High Courts, the point under discussion arose directly for decision in Shyam Narain vs Mangal Prasad (3). The facts were similar to those in The official Assignee, Madras section Sampath Naidu(2) One Ram Narayan, who was the daughter 's son of the last male owner sold the properties in 1910 to the respondents, while they were vested in the daughter Akashi. On her death in 1926, he succeeded to the properties as heir and sold them in 1927 to the appellants. The appellants claimed the estate on the ground that the sale in 1910 conferred no title on the respondents as Ram Narayan had then only a spes successionis. The respondents contended that they became entitled to the properties when Ram Narayan acquired them as heir in 1926. The learned Judge, Sir section M. Sulaiman, C. J., and Rachhpal, J., held, agreeing with 569 the decision in Alamanaya Kunigari, Nabi Sab vs Murukuti Papiah (1),and deffering from The official Assignee, Madras vs Sampath Naidu (2),and Bindeshwari Singh vs Har Narain Singh (3), that s.43 applied and that the respondents, had acquired a good title. In coming to this, conclusion, they relied on the illustration to section 43 as, indicating its, true scope, and observed: "Section 6 (a) would, therefore, apply to cases, where professedly there is, a transfer of a mere spes successionis, the parties knowing that the transferor has, no more right than that of a mere expectant heir. The result, of course, would be the same where the parties, knowing the full facts, fraudulently clothe the transaction in the garb of a an out and out sale of the property, and there is, no erroneous representation made by the transferor to the transferor as, to his, ownership. "But where an erroneous, representation is, made by the transferor to the transferee that he is, the full owner of the property transferred and is authorized to transfer it and the property transferred is not a mere chance of succession but immovable property itself, and the transferee acts, upon such erroneous representation, then if the transferor happens, later, before the contract of transfer comes, to an end, to acquire an interest in that property, no matter whether by private purchase, gift, legacy or by inheritance or otherwise, the previous transfer can at the option of the transferee operate on the interest which has, been subsequently acquired, although it did not exit at the time of the transfer." (pp. 478,479). This decision was followed by the Bombay High Court in Vithabai vs Malhar Shankar (4) and by the 570 Patna High Court in Ram Japan vs Jagesara Kuer(1). A similar view had been taken by the Nagpur High Court in Syed, Bismilla vs Manulal Chabildas(2). The preponderance of judicial opinion is in favour of the view taken by the Madras High Court in Alamanaya Kunigari Nabi Sab vs Murukuti Papiah (3), and approved by the Full Bench in the decision now under appeal. In our judgment, the interpretation placed on section 43 in those decisions correct and the contrary opinion is erroneous. We accordingly hold that when a person transfers property representing that he has a present interest therein, whereas he has, in fact, only a spes successionis, the transferee is entitled to the benefit of section 43, if he has taken the transfer on the faith of that representation and for consideration. In the present case, Santhappa, the vendor in exhibit III, represented that he was entitled to the property in praesenti, and it has been found that the purchaser entered into the transaction acting on that representation. He therefore acquired title to the properties under section 44 of the , when Santhappa became in titulo on the death of Gangamma on February 17, 1933, and the subsequent dealing with them by Santhappa by way of release under exhibit A did not operate to vest any title in the appellant. The Courts below were right in upholding the title of the respondents, and this appeal must be dismissed with costs of the third respondent, who alone appears. Appeal dismissed.

M and S claiming to be reversioners to the estate of N sold the property in dispute to G predecessor in interest of the respondents. The sale deed recited that the property belonged to the joint family of two brothers N and B, and on the death of N it was inherited by his widow and on her death it had devolved upon them as reversioners to the state. G sued to recover possession of the properties. The suit was contested by the widow of B(brother of N) claiming that the property was the self acquired property of her husband. During the pendency of the litigation the widow died, and G applied to the revenue authorities to transfer the 'pattas ' in his name. The appellants intervened alleging that the property was gifted to them by the widow, and S one of the reversioners had also executed a release of the said property for a consideration. This objection was rejected. The appellants then sued for possession of a half share in the properties held by the widow of B, relying upon the gift by the widow, and the deed of surrender by S one of the two reversioners to the estate of N. They contended that the Vendors of the property to G had 555 only a spes successionis during the life time of the widow of B, and the transfer was on that account void and conferred no title. The heirs of contended that the property was sold to by M and S on a representation that the Vendor had become entitled thereto, and the appellants as transferees from S were estopped from asserting that it was in fact the self acquisition of and that in consequence he had no title at the date of the sale. ^ Held, that where a person transfers property representing that he has a present interest therein, whereas he has, in fact, only a spes successions, the transferee is entitled to the benefit of section 43 of the , if he has taken the transfer for consideration and on the faith of the representation. Held, further, that apart from the exception in favour of transferees for consideration in good faith and without notice of the rights under the prior transfer section 43 of the is absolute and unqualified in its operation. It applies to all transfers which fulfil the conditions prescribed therein, and it makes no difference in its application whether the defect of title in the transferor arises by reason of his having no interest in the property, or of his interest therein being that of an expectant heir. The section deals with transfers which fail for want of title in the transferor and not want of capacity in him at the time of transfer. It embodies a rule of estoppel and enacts that a person who makes a representation shall not be heard to allege the contrary as against a person who acts on the representation. It is immaterial whether the transferor acts bona fide or fraudulently in making the representation. It is only material to find out whether in fact the transferee has been misled. In view of the specific provision of section 43 the principle of estoppel against a statute does not apply to transfers prohibited by section 6 (a) of the Act. The two provisions operate in different fields and under different conditions. There is no necessary conflict between them, and the ambit of one cannot be cut down by reference to the other. Section 6(a) enacts a rule of substantive law, while section 43 enacts a rule of estoppel which is one of evidence. Held, also, that if the language of the section clearly excludes from its purview certain matters, it would not be legitimate to use the illustration to the section to enlarge it. It is not to be readily assumed that an illustration to a section is repugnant to it and rejected. Vickers vs Evans, (1910)79 L.J.K.B. 955, relied on. 556 Sadiq Ali Khan vs Jai Kishori, A.I.R. 1928 P.C. 152, Gadigeppa vs Balangauda, (1931) I.L.R. , Ajudhia Prasad vs Chandan Lal, I.L.R. (1937) All. 860 F.B.; Mohomed Syedol Ariffin vs Yeoh Ooi Gark; (1916) L.R. 43 I.A. 256; Levine vs Brougham, ; Leslie Ltd. vs Sheill, and Khan Gul vs Lakha Singh Lah. 701(F.B.), referred to. Alamanaya Kunigari Nabi Sab vs Murukuti Papiah, , Shyam Narain vs Mangal Prasad, All. 474, Vithabai vs Mathar Shankar, I.L.R. , Ram Japan vs Jagesara Kuer, A.I.R. 1939 Pat. 116 and Syed Bismilla vs Munulal Chabildas, A.I R. , approved. Official Assignee, Madras vs Sampath Naidu, and Bindeshwari Singh vs Har Narain Singh, Luck. 622, disapproved.

titions Nos. 110 to 115 of 1960. (Under Article 32 of the Constitution of India for enforcement of Fundamental Rights) A. V. Viswanatha Sastri, R. K. Garg, D. P. Singh, section C. Aggarwal and M. K. Ramamurthi, for the Petitioner. B. Sen, B. K. B. Naidu and I. N. Shroff, for the Respondents. December 21. The Judgment of the Court was delivered by HIDAYATULLAH, J. These six petitions under article 32 of the Constitution have been filed by one Bhaiyalal Shukla, who was doing business of construction of buildings, roads, bridges etc. as contractor for the Public Works Department in Rewa Circle of the former Vindhya Pradesh State, now a part of the State of Madhya Pradesh. By these petitions, he challenges the levy of sales tax on building materials supplied by him in the construction of buildings, roads and bridges for the years, 1953 54 to 1958 59. For the first year in question, sales tax amounting to Rs. 1,840 5 0 has 260 already been charged and paid. He seeks refund of this amount. For the remaining years except the last two, proceedings for assessment have been completed, but the amounts have not been paid. For the remaining two years, proceedings are pending for assessment of the tax. The respondents in the case are the State of Madhya Pradesh, which stands substituted for the State of Vindhya Pradesh, and diverse officers connected with the assessment and levy of the tax. The contention of the petitioner is that the tax is not leviable in view of the decisions of this Court in two cases reported in The State of Madras vs Gannon Dunkerley and Co. (Madras) Ltd.(1) and Pandit Banarsidas vs The State of Madhya Pradesh (2). The respondents, however, claim that the tax is leviable, because the case falls within the decision of this Court reported in Mithan Lal vs The State of Delhi (3). The United State of Vindhya Pradesh was formed by the Rulers of the States in Baghelkhand and Bundhelkhand, who agreed to unite into a common State, with the Maharaja of Rewa as the Rajpramukh. By the Covenant which was entered into by them at that time, it was provided that until a Constitution for the United State would vest in the Rajpramukh, and he was authorised to make and promulgate Ordinances for the peace and good government of the United State of any part thereof, and any Ordinance made by him had the force of an Act passed by the legislature of the United State. The Rajpramukh, in exercise of his powers drawn from the Covenant, promulgated the Vindhya Pradesh Sales Tax Ordinance 2 of 1949 for the levy of a tax on the sale of goods in Vindhya Pradesh. On the inauguration of the present Constitution of 261 India, Vindhya Pradesh became, at first, a part B State but later by the Constitution (Amendment of the First and Fourth Schedules) Order, 1950, it was transferred from Part B to Part C of the Constitution. The ordinance of the Rajpramukh was applied to the whole of Vindhya Pradesh with effect from April 1, 1950 by Notification No. 7 of March 28, 1950 by the Chief Commissioner, Vindhya Pradesh, acting under section 1(2) of the ordinance. Parliament then passed the Part C States (Laws) Act, 1950. Section 2 of that Act provided: "Power to extend enactments to certain Part C States: The Central Government may, by notification in the Official Gazette extend to any Part C State. or to any part of such State, with such restrictions and modifications as it thinks fit, any enactment which is in force in a Part A State at the date of the notification and provision may be made in any enactment so extended for the repeal or amendment of any corresponding law(other than a Central Act) which is for the time being applicable to that Part C State," In exercise of the power conferred by the above section, the Central Government by Notification No. S.R.O. 6 dated December 29, 1950, extended to the State of Vindhya Pradesh the Central Provinces and Berar Sales Tax Act, 1947 (21 of 1947) as in force for the time being in the State of Madhya Pradesh, subject to certain modifications necessitated by the application of the Act to this new area. By the same Notification, a new section was added to the Madhya Pradesh Act, which read as follows: "29. Repeal and Saving: The Vindhya Pradesh Sales Tax Ordinance 2 of 1949 is here by repealed, provided that. . " and here follow certain provisions saving the previous operation of the Ordinance. 262 On March 20, 1951, the Central Government issued Notification No. 52/ECON. in exercise of the powers conferred by sub section (3) of section 1 of the Central Provinces and Berar Sales Tax Act, 1947, as extended to the State of Vindhya Pradesh by Notification No. S.R.O. 6, ordering that from April 1, 1951 the extended Act would come into force in the State of Vindhya Pradesh. On May 23, 1951, this Court rendered its judgment in In re the Delhi Laws Act 1912(1). It was held by majority by this Court that section 2 of the Part C States (Laws) Act, 1950 was intra vires, except for the concluding sentence, "provision may be made in any enactment so extended for the repeal or amendment of any corresponding law (other than a Central Act) which is for the time being applicable to that Part C State", inasmuch as it was ultra vires the Indian Parliament. Parliament then passed the (49 of 1951) on September 6, 1951. Under that Act, Legislative Assemblies were set up, and under section 21, they were invested, subject to certain limitations, with Powers of legislation with respect to any of the matters enumerated in the State List or in the Concurrent List. Section 22 of that Act provided: "If any provision of a law made by the Legislative Assembly of a State is repugnant to any provision of a law made by Parliament, then the 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. Explanation: For the purposes of this section, the expression 'law made by Parliament ' shall not include any law which provides 263 for the extension to the State of any law in force in any other part of the territory of India. " In view of the decision of this Court in the case(1) the States (Miscellaneous Law) Repealing Act, 1951 (66 of 1951) was enacted by Parliament on October 31, 1951. By section 2 of that Act, laws described in Column 2 of its Schedule were repealed or were deemed to have been repealed with effect from the dates specified in the corresponding entry in column 3 of that Schedule. In the Schedule, the Vindhya Pradesh Sales Tax Ordinance, 1949 (2 of 1949) was repealed from December 29, 1950. The Vindhya Pradesh Legislative Assembly, which was set up, then passed the Vindhya Pradesh Laws (Validating) Act, 1952 (6 of 1952). By that Act, which was to extend to the whole of Vindhya Pradesh and to come into force on January 8,1953, it was provided as follows: "2. For the removal of all doubts it is hereby declared that. . Central Provinces and Berar Sales Tax Act, 1947 as extended to Vindhya Pradesh under section 2 of the Part C States Laws Act, 1950 (has been) and shall be deemed to be in force in Vindhya Pradesh from April 1, 1951. Repeal and savings: As from the dates of the actual enforcement of the Acts specified in section 2 of this Act the corresponding laws in force in Vindhya Pradesh immediately before the said dates shall be deemed to have been repealed without prejudice to anything done or suffered thereunder or any right, privilege, obligation or liability acquired, accrued or incurred thereunder before the aforesaid dates. " Section 2 of the Central Provinces and Berar Sales Tax Act, 1947, which was extended to 264 Vindhya Pradesh, defined "contract" to mean any agreement for the carrying out for cash or deferred payment or other valuable consideration, the construction, fitting out, improvement or repair of any building, road, bridge or other immovable property, and further defined "goods" to mean all kinds of property including all materials, articles and commodities, whether or not to be used in the construction, fitting out, improvement or repair of immovable property, and finally defined "sale" as including transfer of property in goods made in the course of the execution of a contract. By these definitions, the materials used or supplied by a building contractor in the construction of buildings, roads, bridges, etc. were made liable to sales tax in accordance with a schedule of rates to which reference seems unnecessary. The legality of these and similar provisions of law purporting to impose sales tax on building materials in State Acts came up for consideration before High Courts in India, and two well defined views were expressed, one holding that the power to disentangle in a building contract the sale of materials from the execution of works with a view to taxing such a sale, was not beyond the legislative power of the States acting under Entry 48, List II, Seventh Schedule of the Government of India Act, 1935, corresponding to Entry 54 of the like List in the Constitution. It was held in those cases that a building contract, though entire, involved labour plus materials and in respect of the materials there was a sale involving transfer of property for consideration, and that the legislature had the power to frame a definition of "sale" to separate the two. The other view was that building contracts were entire, and that there was no sale of goods as contemplated by the Indian Sale of Goods Act, which was the sense in which the Entry was framed, a sense which had a well recognised legal import. 265 This Court in Gannon Dunkerley 's case (1) approved the latter view, which is found in the decision of the Madras High Court in sub nom Gannon Dunkerley vs State of Madras(2), and disapproved the contrary view. It was pointed out that though in a popular sense there was a sale of the materials, there was none in the sense in which the expression "sale of goods" is used in the Indian Sale of Goods Act, since there was no agreement to sell or sale of materials as such, nor did the property pass therein as movables. In Pandit Banarsi Das 's case (3), which was a case from the State of Madhya Pradesh and which was heard simultaneously, it was held that if the parties entered into distinct and separate contracts, one for transfer of materials for money consideration and the other, for payment of remuneration for services or works done, then there was a sale within the meaning of the Sale of Goods Act and the levy of tax was valid; but that if the contract was an entire one, the levy was without competence. The sections of the Central Provinces and Berar Sales Tax Act making such a division and taxing the so called sales of materials were declared to be beyond the powers of the State Legislature. The petitioner contends that the impugned sections of the Central Provinces and Berar Sales Tax Act, as applied to Vindhya Pradesh, fell within these two rulings, and must also be declared ultra vires the Vindhya Pradesh State Legislature, when the latter enacted the Vindhya Pradesh Laws (Validating) Act, 1952. As against this, the respondents contend that the Notification S.R.O. No. 6, which added section 29 repealing the Vindhya Pradesh Sales Tax Ordinance 2 of 1949, the Part C States (Miscellaneous Laws) Repealing Act, 1951 and the Vindhya Pradesh Laws (Validating) Act, 1952 all concurred in repealing 266 Ordinance 2 of 1949 from December 29, 1950, but left intact the operation of the Central Provinces and Berar Sales Tax Act as extended to Vindhya Pradesh by section R. O. No. 6 of 1950. The Vindhya Pradesh Laws (Validating) Act, 1952 merely removed the doubts by stating again that the Central Provinces and Berar Sales Tax Act had been and "shall be deemed to be in force in Vindhya Pradesh from April 1, 1951", but did not re enact that Act. According to the respondents, the Central Provinces and Berar Sales Tax Act was in force in Vindhya Pradesh as a result of its extension by Notification section R. O. 6 and Notification No. 52 (Econ), the repeal of Ordinance 2 of 1949 being achieved by the Part C States (Miscellaneous Laws) Repealing Act, 1951 from December 29, 1950. The respondents, therefore, seek to uphold the impugned provisions on the basis of the ruling of this Court in Mithan Lal 's case(1), where it was pointed out that whatever might be said of the State Legislatures operating under List II did not hold good in the case of Parliament which derived its powers in relation to legislation in Part C States, not only from all the Lists but also from the residuary powers of taxation mentioned in article 248(2). It was also held that section 2 of the Part C States (Laws) Act, 1950 was not repugnant to article 248(2), that the extended law became incorporated by reference in the Part C States (Laws) Act, and that the tax was thus one imposed by Parliament itself. The respondents, therefore, contend that, as held in Mithan Lal 's case(1) when parliament enacted the Part C States (Laws) Act, 1950 and conferred power on the Central Government to extend any Act of a Part A State to any Part C State, that power of extension carried with it the plenary powers of Parliament, and even though the law so extended might have been outside the competence of the State Legislature which enacted it, when extended under the 267 authority of Parliament was a valid piece of law in Part C State. The rival contentions may be reduced to the proposition that if the State Legislature of Vindhya Pradesh extended the Central Provinces and Berar Sales Tax Act, then the extended Act would suffer from the disability pointed out in Gannon Dunkerley 's case (1), but if the Central Provinces and Berar Act was extended by the Notification under the Part States (Laws) Act, 1950, then it must be treated as incorporated in that Act and to have the authority of Parliament which, in relation to Part C States, had no limitations whatever. We have, therefore, to see whether the Central Provinces and Berar Sales Tax Act, 1947 can be said to have been extended for the first time by the Vindhya Pradesh Legislature in 1952 when it passed the Vindhya Pradesh Laws (Validating) Act, 1952 to the exclusion of the order contained in the Notification No. section R. O. 6, or whether the Act continued to be in force in Vindhya Pradesh even before, and all that the Vindhya Pradesh Act did was to remove any doubts about its validity. The contention on behalf of the petitioner is that the Notification dated December 29, 1950 was invalid in its latter part, as decided by this Court in the case (2). That portion dealt with the repeal of Ordinance 2 of 1949, and if the Notification was invalid in that part, then the Central Provinces and Berar Sales Tax Act, which was extended by the opening part, never came into force. Mr. Viswanatha Sastri contended that the notification must be looked at compendiously, and that it was impossible to think that the Central Government would have extended the Central Provinces and Berar Sales Tax Act, if the earlier Ordinance still continued to operate. He relied in this connection upon the observations of this Court in Pesikaka 's case (3) to urge that the 268 Notification which was beyond the powers of the Central Government in its latter part must be regarded as a nullity, and contended that if the invalid portion of the Notification was fundamental to the operation of the valid, then the valid portion also must equally fail because it could not have been intended that two laws on the same topic were to operate simultaneously in Vindhya Pradesh. According to him, the extension of the Central Provinces and Berar Act could not and would not have been made, if the Ordinance had not been first repealed. Section 29 which was added, though composed of two parts, was, according to him, really a part of a single scheme and the repeal of the Ordinance and the extension of the Central Provinces and Berar Act could stand or fall together, and since the Ordinance was never validly repealed, it continued to operate in Vindhya Pradesh till its repeal on October 31, 1951, by the Part C States (Miscellaneous Laws) Repealing Act, 1951, and when the Act repealed it from December 29, 1950, the effect was that there was no sales tax law in operation in Vindhya Pradesh, because the Part C States (Miscellaneous Laws) Repealing Act, 1951, did not enact or extend any law on the subject of sales tax in or to Vindhya Pradesh. According to him, till the enactment of the Vindhya Pradesh Laws (Validating) Act 6 of 1952 on January, 8, 1953 there was no law imposing sales tax in Vindhya Pradesh, and the law was then made by the Legislature of Vindhya Pradesh by extending the Central Provinces and Berar Sales Tax Act from April 1, 1951. He therefore, contended that since the powers of the Vindhya Pradesh Legislature did not include the power of imposing sales tax on building materials, this Act of the Vindhya Pradesh Legislature, if it sought to impose sales tax on building materials, fell within the ruling in Gannon Dunkerley 's case (1) and must be declared as of no effect. He also referred to Act 9 of 1953 269 passed by the Vindhya Pradesh State Legislature, by which the Act was further amended, and stated that the extended Act, as amended, owed its existence neither to Parliament nor to the Central Government acting under the Part C States (Laws) Act but to the Vindhya Pradesh Laws (Validating) Act, 1952 (6 to 1952) and the Vindhya Pradesh Amendment Act, 1953 (9 of 1953). There is a fundamental fallacy involved in this reasoning. We are considering the applicability of the Central Provinces and Berar Sales Tax Act as extended to Vindhya Pradesh. The Vindhya Pradesh Amending Act made only verbal changes, but did not alter the structure of the tax. No doubt, that Act, contained certain provisions under which sales of building materials are taxable, and if the authority to tax the so called sales emanated from a State Legislature, then the law would fail. But we have to remember, in this connection, that the law was first extended to Vindhya Pradesh by the Central Government acting under the authority of Parliament legislating for a Part C State. Parliament and the Central Government were not subject to the disabilities pointed out in Gannon Dunkerley 's case (1), and the matter was covered by the decision of this Court in Mithan Lal 's case (2). Even if the Notification, section R. O. No. 6, failed to repeal ordinance 2 of 1949, Parliament by its own law effaced that Ordinance in Vindhya Pradesh from December 29, 1950, and enacted that the Ordinance shall be deemed to be repealed from that day. After the passing of the Repealing Act by parliament, it is impossible to argue that Ordinance 2 of 1949 continued in Vindhya Pradesh down to January 8, 1953, because by fiction the Ordinance was repealed from December 29, 1950. Parliamentary legislation, therefore, came to the rescue, so to speak, of the Notification by making room for the extension of the Central Provinces and 270 Berar Act by repealing Ordinance 2 of 1949 which the Notification proprio vigore was unable to achieve as laid down in the case(1). The Notification of the Central Government (section R. O. No. 6) and Act 66 of 1951, therefore concurred in removing the Ordinance on December 29, 1950 and in extending the Central Provinces and Berar Sales Tax Act in its place on the same date. Mr. Viswanatha Sastri argued, on the strength of ruling of this Court in Deepchand vs State of Uttar Pradesh (2) that the validity of a law must be judged as on the date on which it was passed, and if the law was invalid on that date, then the law must be deemed not to have existed at all, unless it was later re enacted. The passage relied upon is as follows: "The validity of a statute is to be tested by the constitutional power of a legislature at the time of its enactment by that legislature and, if thus tested, it is beyond the legislative power, it is not rendered valid without re enactment if later, by constitutional amendment, the necessary legislative power is granted. An after acquired power cannot, ex proprio vigore, validate a statute void when enacted." (p. 24). This argument would be applicable if we were to consider that Notification No. section R. O. 6 in isolation, and the question was one of validation of that Notification. The Notification is being questioned, because it sought to repeal Ordinance 2 of 1949, which it could not do. But, today we are not in a position to say that Ordinance 2 of 1949 continued in Vindhya Pradesh, because Parliament by the Part C States (Miscellaneous Laws) Repealing Act, 1951 has enacted that the said ordinance must be deemed to have been repealed from December 29, 1950. Indeed, in the ruling 271 of this Court at the same page are cited passages from Willoughby on Constitution of the United States (2nd Edn.) Vol. 1, p. 10 based on the decision in John M. Wilkerson vs Charles A. Rahrer (1) to the effect that if the cause of the unconstitutionality is removed then the law does not need to be re enacted. The facts of this case are entirely different from those in Deepchand 's case (2). The extended law did not depend on the repeal of the earlier law for its validity. It would have been operative, even if the earlier law was not repealed; but the earlier law was, in fact, repealed from December, 29,1950, and no question of conflict between the new and the old law ever arose. Parliament by repealing the ordinance rendered the ineffective portion of the Notification a mere surplusage. The necessary result thus was that its operative part survived and the Central Provinces and Berar Sales Tax Act, 1947 was validly extended to Vindhya Pradesh, and was valid law as laid down in Mithanlal 's case (3). It did not suffer from the defects pointed out by the this Court in Gannon Dunkerley 's case (4), as it was not enacted or extended by the State Legislature. It remains to consider the last argument on this point, and it is that the Central Provinces and Berar Sales Tax Act was re extended to Vindhya Pradesh by Act 6 of 1952, and thus owed its existence to a law made by a State Legislature which was incompetent to enact a law that building materials in a works contract, which was entire, were liable to sales tax. The preamble of the Act shows that it was enacted to remove certain doubts which were entertained as to whether the extended Sales Tax Act became operative only from October 31, 1951 when Act 66 of 1951 was passed, or from an earlier date, viz., April 1, 1951, from which date it was brought into force in 272 Vindhya Pradesh by Notification No. 52 (Econ.), dated March 20, 1951. To remove these doubts, the Vindhya Pradesh Laws (Validating) Act, 1952, enacted with the assent of the President, declared by section 2 (already quoted) that the Central Provinces and Berar Sales Tax Act had been and "shall be deemed to be in force in Vindhya Pradesh from April 1, 1951. " This declaration did not extend prorio vigore the Central Provinces and Berar Sales Tax Act, but only declared that it must be deemed to be validly in force from April 1, 1951. Section 7, on which much reliance has been placed, may be quoted again: "Repeal and savings: As from the dates of the actual enforcement of the Acts specified in Section 2 of this Act the corresponding laws in force in Vindhya Pradesh immediately before the said dates shall be deemed to have been repealed without prejudice to anything done or suffered thereunder or any right, privilege, obligation or liability acquired, accrued or incurred thereunder before the aforesaid dates" It is said that, if the two sections are read together they mean that the Central Provinces and Berar Sales Tax Act was freshly extended from April 1, 1951 by the Vindhya Pradesh Act and any law made by any authority earlier was freshly repealed to make room for the extension. This argument, in our opinion, is erroneous. To begin with, the powers of the Vindhya Pradesh Legislature were circumscribed by section 22 of the Government of part C States Act, 1951, quoted earlier. Under that section, the powers of the State Legislatures did not extend to making laws repugnant to any law made by Parliament. The Explanation defines the expression "law made by Parliament", and excludes a law which provides for the extension to the State of any law in force 273 in any other part of the territory of India. The Vindhya Pradesh Legislature, however, did not repeal either section 2 of the Part C States (Laws) Act or the Notification, and all that the Legislature did was to add its own authority by a declaration, to the laws earlier extended. The law was extended first by Notification S.R.O. No. 6 on December 29, 1950, but it was brought into force only by Notification No. 52 (Econ.) dated March 20, 1950 from April 1, 1951. The Notification, section R. O. No. 6 had substituted for sub s.(3) of section 1 of the Central Provinces and Berar Sales Tax Act, the following: "(3) It shall come into force on such date as may be notified by the Central Government in the Official Gazette. " Till the Notification No. 52 (Econ.) was made, the Act was extended but was not in force in Vindhya Pradesh. There is a difference between the extension of a law subject to its being brought into force latter and its coming into force on a later date. Section 7 of Act 6 of 1952 repealed only the laws in force prior to the date on which the Central Provinces and Berar Sales Tax Act was brought into force. It speaks of "laws in force in Vindhya Pradesh immediately before April 1, 1951", and the law which was in force immediately before that date was not the Central Provinces and Berar Sales Tax Act which had not been brought into force, but might be Ordinance 2 of 1949, if it had not been successfully repealed earlier. The former Act was extended on December 29, 1950, but was not brought into force till April 1, 1951, and the section speaks of "laws in force". The section, therefore, refers to Ordinance 2 of 1949, which would be in force immediately before April 1, 1951, if not successfully repealed, but not to the Central Provinces and Berar Sales Tax Act which was only extended before that date but had not been brought into force. In other words, section 7 of the Act does no more than replea 274 from April 1, 1951 (if repeal was at all necessary) Ordinance 2 of 1949, which might be supposed to have continued as law till October 31, 1951, when it was repealed by Act 66 of 1951. In point of fact and also in law, it was really repealed from December 29, 1950 under the Repealing Act 66 of 1951. The Vindhya Pradesh Act 6 of 1952 cannot, therefore, be said to have enacted for the first time that the Central Provinces and Berar Sales Tax Act shall come into force from April 1, 1951 in Vindhya Pradesh. It only declared what was a legal fact even without this declaration. Nor did the Central Provinces and Berar Sales Tax Act owe its existence to Act 6 of of 1952 only declared what the result of the earlier laws was, and added the authority of the Vindhya Pradesh Legislature to remove doubts and to save the law from any attack on the ground that the wrong Legislature had repealed the Ordinance or extended the Central Provinces and Berar Sales Tax Act. In our opinion, this argument cannot be accepted. One further argument was advanced to which we have not referred so far, and which may now be noticed. It is that after the reorganisation of the States, Madhya Pradesh has as many as four Sales Tax Acts. It is contended that a person belonging to the area of the former State of Madhya Pradesh is not liable to sales tax on building materials in a works contract under the Central Provinces and Berar Sales Tax Act because of the decision in Pandit Banarsi Das 's case(1), but another person living in the area forming part of the former Vindhya Pradesh is liable to sales tax under the same Act, as extended to Vindhya Pradesh. This, it is said, is patently contrary to the spirit of the equal protection clause in article 14. The laws in different portions of the new State of Madhya Pradesh were enacted by different Legislatures, and under section 119 of the States Reorganisation 275 Act, all laws in force are to continue until repealed or altered by the appropriate Legislature. We have already held that the sale tax law in Vindhya Pradesh was validly enacted, and it brought its validity with it under section 119 of the States Reorganisation Act, when it became a part of the State of Madhya Pradesh. Thereafter, the different laws in different parts of Madhya Pradesh can be sustained on the ground that the differentiation arises from historical reasons, and a geographical classification based on historical reasons has been upheld by this Court in M. K. Prithi Rajji vs The State of Rajasthan(1) and again in The State of Madhya Pradesh vs The Gwalior Sugar Co. Ltd.(2). The latter case is important, because the sugarcane cess levied in the former Gwalior State but not in the rest of Madhya Bharat of which it formed a part, was challenged on the same ground as here, but was upheld as not affected by article 14. We, therefore, reject this argument. In the result, the Writ Petitions fail, and are dismissed; but in the circumstances of the case we make no order about costs.

The appellant was doing business of construction as contractor under Public Works Department in Vindhya Pradesh, now Madhya Pradesh. He challenged the levy of Sales Tax on building materials supplied by him for the year 1953 54 to 1958 59. The contention of the Petitioner was that the tax was not leviable in view of the decision of the Supreme Court in Gannon Dunkerley 's case and Pandit Banarsi Das 's case. The respondents claimed that the tax was leviable because the case fell within the derision in Mithan Lal 's case. The Rajpramukh of the United State of Vindhya Pradesh promulgated the Vindhya Pradesh sales Tax Ordinance 2 of 1949. On Vindhya Pradesh becoming Part C State of India the said ordinance of Rajpramukh was applied to the whole of it with effect from April 1, 1950, by notification No. 7 of March 28, 1951. Under section 2 of the Part C States (Laws) Act, 1950, by notification No. S.R.O. 6 dated December 29, 1950, the Central Provinces & Berar Sales Tax Act 1947, was extended to Vindhya Pradesh. The notification also added section 29 to the Madhya Pradesh Act so extended, by which ordinance 2 of 1949 was repealed. By reason of the decision of this Court in the Delhi Laws Act case the addition of section 29 was unconstitutional. Parliament then enacted the Part C States (Misc. Laws) Repealing Act (66 of 1951). By section 2 of the Act the Vindhya Pradesh Sales Tax ordinance, 1949, was deemed to have been repealed from December 29, 1950. The Vindhya Pradesh Laws (Validity) Act, 1952, also provided and declared that Central Provinces & Berar Sales Tax Act, 1947, which was extended to Vindhya Pradesh under section 2 of the Part C States Laws Act, 1950, has been and shall be deemed to be in force in Vindhya Pradesh from April 1, 1951. The said C. P. & Berar Sales Tax Act defined contract, goods, sales etc, and by these definition the materials used or supplied by 258 a building contractor in the constructions etc, were made liable to Sales Tax in accordance with the schedule rates. The question is, whether C. P. been extended for the first time by the Vindhya Pradesh legislature in 1952, when it passed the Vindhya Pradesh Laws (Validating) Act, 1952, to the exclusion of the order contained in the notification No. S.R.O. 6 or whether the Act continued to be in force in Vindhya Pradesh even before and all that the Vindhya Pradesh Act did as to remove any doubts about its validity. The rival contentions of the appellant and the respondents are reduced to the proposition that if the State Legislature of Vindhya Pradesh extended the Central Province and Berar Sales Tax Act, the extended Act would suffer from disability pointed out in Gannon Dunkerley 's case, but if the said Act was extended by the notification under Part C States (Laws) Act, 1950, then it must be treated as incorporated in the Act and to have the authority of Parliament which, in relation to Part C States, had no limitation whatever. ^ Held, that the extended law in the C. P. & Berar Sales Tax Act, 1947, did not depend on the repeal of the earlier law for its validity. It would have been operative, even if the earlier law was not repealed, but the earlier law was in fact repealed from December 29, 1950, and no question of conflict between the new and the old law ever arose. Held, further, that the Vindhya Pradesh Amending Act made only verbal changes, but did not alter the structure of the tax. No doubt, that Act contained certain provisions under which sales of building materials are taxable, and if the authority to tax the so called sales emanated from a State Legislature, then the law would fail. The law was first extended to the Vindhya Pradesh by the Central Government acting under the authority of Parliament legislating for a Part C State. Parliament and the Central Government were not subject to the disabilities pointed out in Gannon Dunkerley 's case, and the matter was covered by Mithan Lal 's case. Even if the notification S.R.O. No. 6 failed to repeal ordinance 2 of 1949 Parliament by its own law effaced that ordinance in Vindhya Pradesh from December 29, 1950, and enacted that ordinance shall be deemed to be repealed from that day. The ordinance 2 of 1949 did not continue in Vindhya Pradesh down to January 8, 1953 because by fiction the ordinance was repealed from December 29, 1950. Held, also, that the laws in different portions of new State of Madhya Pradesh were enacted by different legislatures and under section 119 of the States Reorganisation Act, all 259 laws in force in a state were to continue until repealed or altered by the appropriate Legislature. The different sales tax laws in different parts of Madhya Pradesh are valid on the ground that the differentiation arises from historical reasons, and a geographical classification based on historical reasons is not affected by article 14 of the Constitution. State of Madras vs Gannon Dunkerley & Co. ; , Pandit Banarsidas vs State of Madhya Pradesh, ; , Mithan Lal vs State of Delhi; , In re the ; , , Gannon Dunkerley vs State of Madras, , Behram Khurshed Pesikaka vs The State of Bombay, , Deepchand vs State of Uttar Pradesh, [1959] Supp. 2 S.C.R. S, John M. Wilkerson vs Charles A. Rahrer, (1891) 140 U. section 545, M. K. Prithi Rajji vs State of Rajasthan C. A. No. 327/56 decided on 2 11 60 and State of Madhya Pradesh vs The Gwalior Sugar Co. Ltd. C. A. Nos. 98 and 99 of 1957 decided on 30 11 1960, referred to.

n No. 128 of 1958. Petition under article 32 of the Constitution of India for enforcement of Fundamental Rights. K.M. Munshi, R. J. Joshi, G.K. Munshi, T.S.N. Diwanji, J.B. Dadachanji, S.N. Andley, Rameshwar Nath and P. L. Vohra, for the petitioner. M. C. Setalvad, Attorney General of India, C.K. Daphtary, Solicitor General of India, H.N. Sanyal, Additional Solictor General of India, B. Sen and R. H. Dhebar, for the respondent. I N. Shroff, for the intervener. January 9 Sinha. C.J., delivered his own Judgment. The Judgment of Sarkar, Das Gupta and Mudholkar, JJ., was delivered by Das Gupta, J. Ayyangar J. delivered a separate Judgment. 500 SINHA, C. J. By this petition under article 32 of the Constitution, the petitioner, who is the 51st Dai ul Mutlaq and head of the Dawoodi Bohra Community challenges the constitutionality of the Bombay Prevention of Excommunication Act, 1949 (Bombay Act XLII of 1949) (hereinafter referred to as the Act) on the ground that the provisions of the Act infringe articles 25 and 26 of the Constitution. The sole respondent in this case is the State of Bombay. The petition is founded on the following allegations. The Dawoodi Bohra Community consist of Muslims of the Shia sect, holding in common with all members of that sect the belief that there is one God, that Mohammed is His Prophet to whom He revealed the Holy Koran; that Ali, the son in law of Mohammed, was the Wasi (executor) of the Prophet, and that the said Ali succeeded the Prophet by Nas e Jali. The Dawoodi Bohras believe that the said Ali was succeeded by a line of Imams, each of whom in turn was appointed by Nas e Jali by his immediate predecessor. The Shia sect itself became divided into two sub sects, known respectively as Ismailis and Isna Asharia. The Dawoodi Bohras belong to the former sect, and believe that owing to persecution Imam Type (the 21st Imam) went into seclusion and that an Iman from his line appear, it being their belief that an Iman always exists although at times he may be invisible to his believers, while in seclusion; that owing to the impending seclusion of the 21st Imam (Imam Tyeb) his predecessor, the 20th Imam, directed his Hujjat (a dignitary ranking next to an Imam), one Hurra tul Malaka, to appoint a Dai, a Mazoon (a dignitary next to a Dai) and a Mukasir (a dignitary ranking next to a Mazoon) to carry on the Dawal (mission) of the Imam so long as the Imam should remain in seclusion, and to take and receive from the faithful an oath of allegiance. The Dais are 501 known as Dai ul Mutlaq. The petitioner, as the Head Priest of the community of Dawoodi Bohras, is the vice gerent of Imam on Earth in seclusion. The petitioner is a citizen of India. As Dai ul Mutlaq and the vicegerent of Imam on Earth in seclusion, the Dai has not only civil powers as head of the sect and as trustee of the property, but also ecclesiastical powers as religious leader of the community. It is the right and privilege of the petitioner as Dai ul Muntlaq to regulate the exercise of religious rights in places where such rights and ceremonies are carried out and in which religious exercises are performed. In his capacity as the Dai ul Mutlaq, that is to say, as religious leader as well as trustee of the property of the community, one of his duties is to manage the properties which are all under his directions and control. He has also the power of excommunication. This power of excommunication is not an absolute, arbitrary and untrammelled power, but has to be exercised according to the usage and tenets of the community. Save in exceptional circumstances, expulsion from the community can be effected only at a meeting of the Jamat, after the person concerned has given due warning of the fault complained of and an opportunity of mending, and after a public statement of the grounds of expulsion. The result of excommunication properly and legally effected involves exclusion from the exercise of religious rights in places under the trusteeship of the Dai ul Mustlaq. The petitioner claims that as the head of the Dawoodi Bohra community and as Dai ul Mutlaq, he has the right and power, in a proper case and subject to the conditions of legal exercise of that power, to excommunicate a member of the Dawoodi Bohra community, and this power of excommunication is an integral part of the religious faith and belief of the Dawoodi Bohra community. The petitioner further affirms that the exercise of the right of 502 excommunication is a matter of religion, and that, in any event, the right is an incident of the management of the affairs of the Dawoodi Bohra community in matters of religion. He also asserts that the Dawoodi Bohra community constitutes a religious denomination within the meaning of article 26 of the Constitution; the said right of the petitioner to excommunicate a member of the community, for reasons of which the petitioner is the sole judge in the exercise of his position as the religious head, is a guaranteed right under articles 25 and 26 of the Constitution. The Bombay Legislature enacted the Act, which came into force on November 1, 1949. The petitioner asserts that the Act violates his right and power, as Dai ul Mutlaq and religious leader of the Dawoodi Bohra community, to excommunicate such members of the community as he may think fit and proper to do; the said right of excommunication and the exercise of that right by the petitioner in the manner aforesaid are matters of religion within the meaning of article 26(b) of the Constitution. It is submitted by the petitioner that the said Act violates or infringes both the articles 25 and 26 of the Constitution, and to that extent, after the coming into force of the Constitution, has become void under article 13 of the Constitution. The petitioner claims that notwithstanding the provisions of the Act, he, as the religious leader and Dai ul Mutlaq of the community, is entitled to excommunicate any member of the Dawoodi Bohra community for an offence, which according to his religious sense justifies expulsion; and insofar as the Act interferes with the said right of the petitioner, it is ultra vires the Legislature. The Act is also challenged on the ground of legislative incompetence of the then Legislature of Bombay, inasmuch as it is contended that such a power is not contained in any of the entries in the Seventh Schedule of the Government of India Act, 1935. 503 One Tayebhai Moosaji Koicha (Mandivala) instituted a suit, being suit No. 1262 of 1949, in the High Court of Judicature at Bombay, praying inter alia, for a declaration that certain orders of excommunication passed by the petitioner against him prior to the enactment of the Act were void and illegal and of no effect, and that the plaintiff continued to remain a member of the Dawoodi Bohra community. The said suit was heard by J.C. Shah, J., who, by his judgment dated February 21, 1952, held that the Act was not inconsistent with article 26 of the Constitution, and was not ultra vires the Legislature of the Province of Bombay. The petitioner, being dissatisfied with the judgment of the learned Judge, preferred an appeal that came up for hearing before the Court of Appeal, composed of Chagla, C. J., and Bhagwati J. By its judgment dated August 26, 1952, the Court of Appeal upheld the judgment of the learned single Judge, though on different grounds. The petitioner obtained leave from the High Court to appeal to this Court, and ultimately filed the appeal, being Civil Appeal No. 99 of 1954. During the pendency of the appeal, the plaintiff respondent aforesaid died and an application made on behalf of his heirs for being brought on the record was not granted by the High Court of Bombay. This Court dismissed the said appeal on the ground that the plaintiff having died, the cause of action did not survive. The petitioner further alleges that parties inimical to him and to the Dawoodi Community have written scurrilous articles challenging and defying the position, power or authority of the petitioner as the religious head of the community; the challenge to the petitioner 's position and his power to excommunicate as the head of the Dawoodi Bohra community is violative of the petitioner 's guaranteed rights under articles 25 and 26 of the Constitution. It is, therefore, claimed that it 504 is incumbent upon the respondent, in its public character, to forbear from enforcing the provisions of the Act against the petitioner. By the petitioner 's attorney 's letter, annexure B to the petition, dated July 18, 1958, the petitioner pointed out to the respondent the unconstitutionality of the Act and requested the latter to desist from enforcing the provisions of the Act against the petitioner or against the Dawoodi Bohra community. In the premises, a writ of Mandamus or a writ in the nature of Mandamus or other appropriate writ, direction or order under article 32 of the Constitution was prayed for against the respondent restraining it, its officers, servants and agents from enforcing the provisions of the Act. The answer of the State of Bombay, the sole respondent, is contained in the affidavit sworn to by Shri V.N. Kalghatgi, Assistant Secretary to the Government of Bombay, Home Department, to the effect that the petitioner not having taken any proceedings to excommunicate any member of the community had no cause of action or right to institute the proceedings under article 32 of the Constitution; that it was not admitted that the Dai ul Mutlaq, as the head of the community, has civil powers, including the power to excommunicate any member of the community; that, alternatively, such power is not in conformity with the policy of the State, as defined in the Constitution; that the petitioner, as the head of the community may have the right to regulate religious rights at appropriate places and occasions, but those rights do not include the right to excommunicate any person and to deprive him of his civil rights and privileges; and that, in any event, after the coming into effect of the impugned Act, the petitioner has no such rights of excommunication; that it was denied that the right to excommunicate springs from or has its foundation in religion and religious doctrines, tenets and faith of the Dawoodi Bohra community that, at 505 any rate, it was denied that the right to excommunicate was an essential part of the religion of the community; that, alternatively, assuming that it was part of a religious practice, it runs counter to public order, morality and health. It was also asserted that the impugned Act was a valid piece of legislation enacted by a competent legislature and within the limits of article 25 and 26 of the Constitution; and that the right to manage its own affairs vested in a religious community is not an absolute or untrammelled right but subject to a regulation in the interest of public order, morality and health. It was denied that the alleged right of the petitioner to excommunicate a member of the community is guaranteed by articles 25 and 26 of the Constitution. In the premises, it was denied that the petitioner had any right to the declaration sought or the relief claimed that the provisions of the Act should not be enforced. At a very late stage of the pendency of the proceedings in this Court, in April 1961, one Kurbanhusein Sanchawala of Bombay, made an application either for being added as a party to the Writ Petition or, alternatively, for being granted leave to intervene in the proceedings. In his petition for intervention, he stated that he was a citizen of India and was by birth a member of the Dawoodi Bohra community and as such had been taking an active part in social activities for bettering the conditions of the members of the community. He asserted that members of the community accepted that up to the 46th Dai ul Mutlaq there was no controversy, that each one of them had been properly nominated and appointed, but that a controversy arose as regards the propriety and validity of the appointment of the 47th Dia ul Mutlaq, which controversy continued all along until the present time so that opinion is divided amongst the members of the Dawoodi Bohra community as to the validity of appointments and 506 existence of Dai ul Mutlaq, from the 47th to the 51st Dai ul Mutlaq, including the present petitioner. The intervener also alleged that but for the impugned Act, the petitioner would have lost no time in excommunicating him. In the premises, he claims that he is not only a proper but necessary party to the writ Petition. He, therefore, prayed to be added as a party respondent, or, at any rate, granted leave to intervene at the hearing of the Writ Petition. We have to dispose of this petition because no orders have been passed until the hearing of the main case before us. In answer to the petitioner 's claims, the intervener has raised the following grounds, namely, that the Holy Koran does not permit excommunication, which is against the spirit of Islam; that, in any event, the Dai ul Mutlaq had no right or power to excommunicate any member of the community, and alternatively, that such a right, assuming that it was there, was wholly "out of date in modern times and deserves to be abrogated and was rightly abrogated by the said Act. " It was further asserted that the alleged right of excommunication was opposed to the universally accepted fundamentals of human rights as embodied in the "Universal Declaration of Human Rights. " It was also asserted that the Act was passed by a competent legislature and was in consonance with the provisions of articles 25 and 26 of the Constitution. The intervener further claims that the rights to belief, faith and worship and the right to a decent burial were basic human rights and were wholly inconsistent with the right of excommunication claimed by the petitioner, and that the practice of excommunication is opposed to public order and morality; that the practice of excommunication was a secular activity associated with religious practice and that the abolition of the said practice is within the saving cl. 2(a) of article 25 of the Constitution. It was also asserted that, under the Mohamadan Law, properties attached to 507 institutions for religious and charitable purposes vested in the Almighty God and not in the petitioner, and that all the members of the Dawoodi Bohra community had the right to establish and maintain such institutions, in consonance with article 26 of the Constitution; that is to say that article 26 guarantees the right of the denomination as a whole and not an individual like the petitioner. It was also asserted that the provisions of the Act prohibiting excommunication was in furtherance of public order and morality and was just and reasonable restriction on a secular aspect of a religious practice. The petitioner challenged the right of the intervener either to intervene or to be added as the party respondent. In his rejoinder to the petition for intervention, the petitioner further alleged that the practice of excommunication was essential to the purity of religious denominations because it could be secured only by removal of persons who were unsuitable for membership of the community. It was, therefore, asserted that those who did not accept the headship of the Dal ul Mutlaq, including the petitioner, must go out of the community and anyone openly defying the authority of the Dai ul Mutlaq was liable to be excommunicated from the membership of the community, entailing loss of rights and privileges belonging to such members. It was, therefore, claimed that the practice of excommunication was, and is, an essential and integral part of the religion and religious belief, faith and tenets of Dawoodi Bohra community, which have been guaranteed by article 26 of the Constitution. It has been urged on behalf of the petitioner, in support of the petition, that the Dawoodi Bohra community, of which the petitioner is the religious head, as also a trustee in respect of the property belonging to the community, is a religious denomination within the meaning of article 26 of the Constitution; that as such a religious denomination it is 508 entitled to ensure its continuity by maintaining the bond of religious unity and discipline, which would secure the continued acceptance by its adherents of certain essential tenets, doctrines and practices; the right to such continuity involves the right to enforce discipline, if necessary by taking the extreme step of excommunication; that the petitioner as the religious head of the denomination is invested with certain powers, including the right to excommunicate dissidents, which power is a matter of religion within the meaning of article 26(b) of the Constitution that the impugned Act, insofar as it takes away the power to enforce religious discipline and thus compels the denomination to accept dissidents as having full rights as a member of the community, including the right to use the properties and funds of the community dedicated to religious use, violates the fundamental rights of the petitioner guaranteed under article 26. In this connection, reliance was placed on the decision of this Court in The Commissioner, Hindu Religious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt (1), which, it is contended, has laid down that the guarantee under the Constitution not only protects the freedom of opinion, but also acts done in pursuance of such religious opinion, and that it is the denomination itself which has a right to determine what are essential parts of its religion, as protected by the provisions of articles 25 and 26 of the Constitution. It was further contended that the right to worship in the mosque belonging to the community and of burial in the graveyard dedicated to the community were religious rights which could not be enjoyed by a person who had been rightly excommunicated. Insofar as the Act took away the right of the petitioner as the head of the community to excommunicate a particular member of the community and thus to deprive him of the use of the funds and property belonging to the commu 509 nity for religious purposes, had the effect of depriving the petitioner of his right as the religious head to regulate the right to the use of funds and property dedicated to religious uses of the community. It has also been contended that religious reform, if that is the intention of the impugned Act, is outside the ambit of article 25(2) (b) of the Constitution. The learned Attorney General for the respondent contended on the other hand, that the right to excommunicate, which has been rendered invalid by the impugned Act, was not a matter of religion within the meaning of article 26(b) of the Constitution; that what the Act really intended was to put a stop to the practice indulged in by a caste or a denomination to deprive its members of their civil rights as such members, as distinguished from matters of religion, which were within the protection of article 25 and 26. Alternatively, it was also argued that even assuming that excommunication was concerned with matters of religion, the Act would not be void because it was a matter of reform in the interest of public welfare. It was also argued that there was no evidence on the record to show, that excommunication was an essential matter of religion. The right to worship at a particular place or the right of burial in a particular burial ground were questions of civil nature, a dispute in respect of which was within the cognizance of the Civil Courts. The legislation in question, in its real aspects, was a matter of social welfare and social reform and not within the prohibitions of article 25(1) or article 26. Excommunication involving deprivation of rights of worship or burial and the like were not matters of religion within the meaning of article 26(b), and finally, article 26(b) was controlled by article 25(2) (b) of the Constitution, and, therefore, even if excommunication touched certain religious matters, the Act, insofar as it had abolished it, was in consonance with modern notions of human dignity 510 and individual liberty of action even in matters of religious opinion and faith and practice. Shri Shroff, appearing for the intervener, attempted to reopen the question whether the petitioner as Dai ul Mutlaq, assuming that he had been properly elected as such, had the power to excommunicate, in spite of the decision of their Lordships of the Judicial Committee of the Privy Council in Hasan Ali vs Mansoor Ali (1). He also supported the provisions of the impugned Act on the ground that they were in furtherance of public order. As we are not here directly concerned with the question whether or not the petitioner as the head of the religious community had the power to excommunicate, we did not hear Mr. Shroff at any length with reference to that question. We shall proceed to determine the controversy in this case on the assumption that the petitioner had that power. We are only directly concerned with the questions whether the provisions of the Act, insofar as they have rendered invalid the practice of excommunication, are unconstitutional as infringing article 26(b), and enacted by a legislature which was not competent to do so, as contended on behalf of the petitioner. We will, therefore, confine our attention to those questions. Keeping in view the limited scope of the controversy, we have first to determine the ambit and effect of the impugned Act. The Bombay Prevention of Excommunication Act (Bombay Act XLII of 1949) is an Act to prohibit excommunication in the province of Bombay. Its preamble, which shortly states the background of the legislation, is in these terms: "Whereas it has come to the notice of Government that the practice prevailing in certain communities of excommunicating its members is often followed in a manner which results in the deprivation of legitimate rights and privileges of its members; 511 And whereas in keeping with the spirit of changing times and in the public interest it is expedient to stop the practice; it is hereby enacted is follows". The definition of "Community" as given in section 2(a) would include the Dawoodi Bohra community, because admittedly its members are knit together by reason of certain common religious doctrines. and admittedly its members belong to the same religion or religious creed of a section of the Shia community of Muslims. The term 'community" includes a caste or a sub caste also. "Excommunication" has been defined by section 2 (b) as meaning "the expulsion of a person from any community of which he is member depriving him of rights and privileges which are legally enforceable by a suit of civil nature. ", and the explanation to the definition makes it clear that the rights and privileges within the meaning of the definition include the right to office or property or to worship in any religious place or a right of burial or cremation, notwithstanding the fact that the determination of such right depends entirely on the decision of the question as to any religious rites or ceremonies or rule or usage of a community. By section 3, excommunication of a member of a community has been declared to be invalid and of no effect, notwithstanding any law, custom or usage to the contrary. Any act of excommunication, or any act in furtherance of excommunication, of any member of a community has been made a penal offence liable to a punishment, on conviction, of fine which may extend to one thousand rupees. The explanation has made it clear that any person who has voted in favour of a decision of excommunication at a meeting of a body or an association of a particular denomination is deemed to have committed the offence made punishable by section 4, as aforesaid. Sections 5 and 6 lay down the procedure for the trial of an offence under the Act, the limit of time 512 within which the prosecution must be launched and the necessity of previous sanction of the authority indicated therein. These, in short, are the provisions of the impugned Act. It will be noticed that the Act is a culmination of the history of social reform which began more than a century ago with the enactment of section 9 of Regulation VII of 1832 of the Bengal Code, which provided, inter alia, that the laws of Hindus and Muslims shall not be permitted to operate to deprive the parties of any property to which, but for the operation of such laws, they would have been entitled. Those provisions were subsequently incorporated in the India Act (XXI of 1850) known as the Caste Disabilities Removal Act which provided that a person shall not be deprived of his rights or property by reason of his or her renouncing or exclusion from the communion of any religion or being deprived of caste, and that any such forfeiture shall not be enforced as the law in the Courts. The impugned Act, thus, has given full effect to modern notions of individual freedom to choose one 's way of life and to do away with all those undue and outmoded interferences with liberty of conscience, faith and belief. It is also aimed at ensuring human dignity and removing all those restrictions which prevent a person from living his own life so long as he did not interfere with similar rights of others. The legislature had to take the logical final step of creating a new offence by laying down that nobody had the right to deprive others of their civil rights simply because the latter did not conform to a particular pattern of conduct. The Act, in substance, has added a new offence to the penal law of the country by penalising any action which has the effect of depriving a person of his human dignity and rights appurtenant thereto. It also adds to the provisions of the Criminal Procedure Code and has insisted upon the previous sanction of the prescribed 513 authority as a condition precedent to launching a prosecution for an alleged offence against the provisions of the Act. In my opinion, therefore, the enactment, in pith and substance, would come within Entries 1 & 2 of List III of the Concurrent Legislative List of the Constitution Act of 1935. It is true that "excommunication" does not, in terms, figure as one of the entries in any one of the three lists. The legislative competence of the Bombay Legislature to enact the Act has not been seriously challenged before us, and, therefore, no particular argument was addressed to us to show that the legislation in question could not be within the purview of Entries 1 & 2 of List III aforesaid. What was seriously challenged before us was the constitutionality of the Act, in the light of the Constitution with particular reference to articles 25 & 26, and I shall presently deal with that aspect of the controversy. But before I do that, it is convenient to set out the background of the litigation culminating in the present proceedings. The first reported case in relation to some aspects of Shia Imami Ismailis is that of the Advocate General ex relation Dave Muhammad vs Muhammad vs Husen Huseni (1). That was a suit commenced before the coming into existence of the Bombay High Court, on the Equity Side of the late Supreme Court, instituted by an information and bill, filed by the relators and plaintiffs, representing a minority of the Khoja community, against the defendants representing the majority of that community. The prayer in the action was that an account be taken of all property belonging to or held in trust for the Khoja community of Bombay in the hands of the treasurer and the accountant, respectively called Mukhi and Kamaria, and other cognate reliefs not relevant to the present controversy. In that case, which was heard on the Original side by Arnould J., judgment was delivered in November 1866, after a 514 prolonged hearing. In that case, the learned Judge went into a detailed history of the several sects amongst Muslims, including the Shia Imami Ismailis, with particular reference to the Aga Khan and his relation with the Jamat of the Khojas of Bombay. In that case it was laid down that there was no public property impressed with a trust, either express or implied, for the benefit of the whole Khoja community and that Aga Khan, as the spiritual head of the Khojas was entitled to determine on religious grounds who shall or shall not remain members of the Khoja community. In that case, the learned Judge, with reference to authoritative texts, went into the detailed history of the two sects of the Sunnis and Shias. He discussed the origin of the Ismailis as an offshoot of the Shias, and traced the hereditary succession of the unrevealed Imams in unbroken line down to Agha Khan. Except for its historical aspect, the case does not deal with any matter relevant to the present controversy. The next reported case which was brought to our notice is the case of the Advocate General of Bombay vs Yusufalli Ebrahim (1). That was a case directly in relation to the Dawoodi Bohra community, with which we are concerned in this case. In that case, there was a dispute as regards a mosque and a tomb, and was heard by Marten J., on the Original side in 1921. We are not concerned with the details of the controversy in that case. But the learned Judge has noticed the history of this community, with particular reference to the position of the Dai ul Mutlaq, and how the differences between the majority of the community and the minority arose on the question of the regularity of the succession of the 47th Dai in 1840. The learned Judge has pointed out that the powers of the Dai are at least thrice delegated, 515 namely, by God to Prophet Mohammad, by the latter to the Imam, and by the Imam to the Dai ul Mutlaq. The more directly in point is the litigation which was concluded by the judgment of their Lordships of the Judicial Committee of the privy Council in the case of Hasanali vs Mansoorali (1). In that case, the powers of the Dai ul Mutlaq to excommunicate were directly in controversy. The petitioner was the first defendant in that action, which had been commenced in October, 1925, and was decided by the judgment of the Subordinate Judge of Burhanpur, dated January 2, 1931. That decision was reversed by the Judicial Commissioner of Central Provinces & Berar (later the High Court at Nagpur) by his judgment dated October 25, 1934. That judgment was taken on appeal to the Privy Council and the judgment of the Privy Council very succinctly traces the history of the Dawoodi Bohra community until we come to the 51st Dai, who was the first defendant in that action, and is the petitioner before us. In that case, certain orders of excommunication were under challenge. As a result of those orders of excommunication, the plaintiffs had been obstructed in, and prevented from, entering the property in suit for the purposes of worship, burial and resting in the rest house. In that case, their Lordships did not uphold the claim of the Dai ul Mutlaq that he had unrestricted power of excommunication, though they found that he could be regarded as Dai ul Mutlaq. As regards the power to excommunicate, it was held that though the power was there, it was not absolute, arbitrary and untrammelled; and then their Lordships laid down the conditions for the valid exercise of that power. The effect of a valid excommunication in their Lordships ' view, was exclusion from the exercise of religious rights in places under the trusteeship of the head of the community, because the Dai was not only a religious 516 leader but also a trustee of the property of the community. After examining the evidence in that case, their Lordships held that the persons alleged to have been excommunicated had not been validly expelled from the community. The judgment of the Privy Council was given on December 1, 1947. Within two years of that judgment the impugned Act was passed, and soon after a suit on the Original side of the Bombay High Court was commenced (being suit No. 1262 of 1949). That was a suit by a member of the Dawoodi Bohra community, who had been excommunicated by the petitioner, functioning as the Dai ul Mutlaq, by two orders of excommunication, one passed in 1934 and the other in 1948, soon after the judgment of the Privy Council. The suit was, inter alia, for a declaration that the orders of excommunication were void in view of the Act. A number of issues were raised at the trial, which was heard by Shah J. Two questions, by way of preliminary issues, with which we are immediately concerned in the present proceedings, were raised before the learned Judge of the Bombay High Court, namely: (1) Was the Act within the legislative competence of the Legislature of the Province of Bombay ? (2) Whether after the coming into force of the Constitution, the Act was invalid in view of articles 25 and 26 of the Constitution? The learned Judge, after an elaborate examination of the Constitution Act of 1935, came to the conclusion that the Bombay Legislature was competent to enact the Act, and that it was not unconstitutional even after the coming into effect of the Constitution because it was not inconsistent with the provisions of articles 25 and 26. An appeal was taken to the Court of Appeal, which was heard by Chagla C. J. and Bhagwati J. The Court of 517 Appeal upheld the decision of Shah J. The matter was brought up on appeal to this Court in Civil Appeal 99 of 1954. During the pendency of the appeal in this Court, the plaintiff died and it was held, without deciding the merits of the controversy, that the suit giving rise to the appeal in this Court had abated by reason of the fact that the plaintiff had died and the cause of action being personal to him was also dead. The Order of this Court dismissing the appeal as not maintainable is dated November 27, 1957. This Writ Petition was filed on August 18, 1958 by the petitioner as the 51st Dai ul Mutlaq and head of the Dawoodi Bohra community, for a declaration that the Act was void so far as the petitioner and the Dawoodi Bohra community were concerned, and that a writ of mandamus or a writ in the nature of mandamus or other appropriate write direction or order under article 32 of the Constitution be issued restraining the respondent, its officers, servants and agents from enforcing the provisions of the Act, against the petitioner or the Dawoodi Bohra community, or in any manner interfering with the right of the petitioner, as the religious leader and Dai ul Mutlaq of the Dawoodi Bohra community, to excommunicate any member of the community for an offence which the petitioner, in the exercise of his religious sense as the religious head of the community may determine as justifying such as expulsion. It is not disputed that the petitioner is the head of the Dawoodi Bohra community or that the Dawoodi Bohra community is a religious denomination within the meaning of article 26 of the Constitution. It is not even disputed by the State, the only respondent in the case, that the petitioner as the head of the community had the right, as found by the Privy Council in the case of Hasanali vs Mansoorali(1), to excommunicate a particular member of the community for reasons and in the 518 manner indicated in the judgment of their Lordships of the Privy Council. But what is contended is that, as a result of the enactment in question, excommunication has been completely banned by the Legislature, which was competent to do so, and that the ban in no way infringes articles 25 and 26 of the Constitution. I have already indicated my considered opinion that the Bombay Legislature was competent to enact the Act. It now remains to consider the main point in controversy, which was, as a matter of fact, the only point urged in support of the petition, namely, that the Act is void in so far as it is repugnant to the guaranteed rights under articles 25 and 26 of the Constitution. article 25 guarantees the right to every person, whether citizen or non citizen, the freedom of conscience and the right freely to profess, practise and propagate religion. But this guaranteed right is not an absolute one. It is subject to (1) public order, morality and health, (2) the other provisions of Part III of the Constitution, (3) any existing law regulating or restricting an economic, financial, political or other secular activity which may be associated with religious practice, (4) a law providing for social welfare and reform, and (5) any law that may be made by the State regulating or restricting the activities aforesaid or providing for social welfare and reform. I have omitted reference to the provisions of Explanations I and II and other parts of article 25 which are not material to our present purpose. It is noteworthy that the right guaranteed by article 25 is an individual right as distinguished from the right of an organised body like a religious denomination or any section thereof, dealt with by article 26. Hence, every member of the community has the right, so long as he does not in any way interfere with the corresponding rights of others, to profess, practise and propagate his religion, and everyone is guaranteed his freedom of conscience. The 519 question naturally arises: Can an individual be compelled to have a particular belief on pain of a penalty, like excommunication? One is entitled to believe or not to believe a particular tenet or to follow or not to follow a particular practice in the matters of religion. No one can, therefore, be compelled, against his own judgment and belief, to hold any particular creed or follow a set of religious practices. The Constitution has left every person free in the matter of his relation to his Creator, if he believes in one. It is, thus, clear that a person is left completely free to worship God according to the dictates of his conscience, and that his right to worship as he pleased is unfettered so long as it does not come into conflict with any restraints, as aforesaid, imposed by the State in the interest of public order, etc. A person is not liable to answer for the verity of his religious views, and he cannot be questioned as to his religious beliefs, by the State or by any other person. Thus, though his religious beliefs are entirely his own and his freedom to hold those beliefs is absolute, he has not the absolute right to act in any way he pleased in exercise of his religious beliefs. He has been guaranteed the right to practise and propagate his religion subject to the limitations aforesaid. His right to practise his religion must also be subject to the criminal laws of the country, validly passed with reference to actions which the Legislature has declared to be of a penal character. Laws made by a competent legislature in the interest of public order and the like, restricting religious practices, would come within the regulating power of the State. For example, there may be religious practices of sacrifice of human beings, or sacrifice of animals in a way deleterious to the well being of the community at large. It is open to the State to intervene, by legislation, to restrict or to regulate to the extent of completely stopping such deleterious practices. It must, therefore, be held 520 that though the freedom of conscience is guaranteed to every individual so that he may hold any beliefs he likes, his actions in pursuance of those beliefs may be liable to restrictions in the interest of the community at large, as may be determined by common consent, that is to say, by a competent legislature. It was on such humanitarian grounds, and for the purpose of social reform, that so called religious practices like immolating a widow at the pyre of her deceased husband, or of dedicating a virgin girl of tender years to a god to function as a devadasi, or of ostracising a person from all social contacts and religious communion on account of his having eaten forbidden food or taboo, were stopped by legislation. But it has been contended on behalf of the petitioner that the right guaranteed, under article 25, to freedom of conscience and the freedom to profess, practise and propagate religion is available not only to an individual but to the community at large, acting through its religious head; the petitioner, as such a religious head has, therefore, the right to excommunicate, according to the tenets of his religion, any person who goes against the beliefs and practice connected with those beliefs. The right of the petitioner to excommunicate is, therefore, a fundamental right, which cannot be affected by the impugned Act. In this connection, reference was made to the following observations in the leading judgment of this Court, bearing upon the interpretations of articles 25 and 26 (vide The Commissioner, Hindu Religious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt) (1): "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 521 these forms and observances might extent even to matters of food and dress. The guarantee under our Constitution not only protects the freedom of religious opinion but it protects also acts done in pursuance of a religion and this is made clear by the use of the expression 'practice of religion ' in Article 25. " On the strength of those observations, it is contended on behalf of the petitioner that this practice of ex communication is a part of the religion of the community with which we are concerned in the present controversy, article 26, in no uncertain terms, has guaranteed the right to every religious denomination or a section thereof "to manage its own affairs in matters of religion" (article 26(b)). Now what are matters of religion and what are not is not an easy question to decide. It must vary in each individual case according to the tenets of the religious denomination concerned. The expression "matters of religion" in Art 26(b) and "activities associated with religious practice" do not cover exactly the same ground. What are exactly matters of religion are completely outside State interference, subject of course to public order, morality and health. But activities associated with religious practices may have many ramifications and varieties economic, financial, political and other as recognised by article 25(2)(a). Such activities, as are contemplated by the clause aforesaid cover a field much wider than that covered by either article 25(1) or article 26(b). Those provisions have, therefore, to be so construed as to create no conflict between them. We have, therefore, to classify practices into such as are essentially and purely of a religious character, and those which are not essentially such. But it has been contended on behalf of the petitioner that it is for the religious denomination itself to determine what are essentially reli 522 gious practices and what are not. In this connection, reliance is placed on the following observations of this Court in the leading case, aforesaid, of The Commissioner, Hindu Religious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt (1): "As we have already indicated, freedom of religion in our Constitution is not confined to religious beliefs only; it extends to religious practices as well subject to the restrictions which the Constitution itself has laid down. Under article 26(b), therefore, a religious denomination or organisation enjoys complete autonomy in the matter of deciding as to what rites and ceremonies are essential according to the tenets of the religion they hold and no outside authority has any jurisdiction to interfere with their decision in such matters. " It should be noted that the complete autonomy which a religious denomination enjoys under article 26(b) is in 'matters of religion ', which has been interpreted as including rites and ceremonies which are essential according to the tenets of the religion. Now, article 26(b) itself would seem to indicate that a religious denomination has to deal not only with matters of religion, but other matters connected with religion, like laying down rules and regulations for the conduct of its members and the penalties attached to infringement of those rules, managing property owned and possessed by the religious community, etc., etc. We have therefore, to draw a line of demarcation between practices consisting of rites and ceremonies connected with the particular kind of worship, which is the tenet of the religious community, and practices in other matters which may touch the religious institutions at several points, but which are not intimately concerned with rites and ceremonies the performance of which is an 523 essential part of the religion. In this connection, the following observations of this Court in The Durgah Committee, Ajmer vs Syed Hussain Ali (1) which were made with reference to the earlier decisions of this Court in The Commissioner, Hindu Religious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt (2) and in Sri Venkataramana Devaru vs The State of Mysore (3), that "matters of religion" in article 26(b) include even practices which are regarded by the community as part of its religion, may be noted: "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 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. " But then it is contended that a religious denomination is a quasi personality, which has to ensure its continuity and has, therefore, to lay down rules for observance by members of its community, and, in order to maintain proper and strict 524 discipline, has to lay down sanctions; the right to excommunicate a recusant member is an illustration of that sanction. In this connection, it was contended that the Privy Council had laid down in the case of Hasanali vs Mansoorali (1) that the power of excommunication was a religious power exercisable by the Dai. In my opinion, those passages in the judgment of the Privy Council do not establish the proposition that the right which the Privy Council found inhered in the Dai was a purely religious right. That it was not a purely religious right becomes clear from the judgment of the Judicial Committee of the Privy Council, which laid down the appropriate procedure and the manner of expulsion, which had to be according to justice, equity and good conscience, and that it was justiciable. A matter which is purely religious could not come within the purview of the Courts. That conclusion is further strengthened by the consideration that the effect of the excommunication or expulsion from the community is that the expelled person is excluded from the exercise of rights in connection not only with places of worship but also from burying the dead in the community burial ground and other rights to property belonging to the community, which are all disputes of a civil nature and are not purely religious matters. In the case before their Lordships of the Privy Council, their Lordships enquired into the regularity of the proceedings resulting in the excommunication challenged in that case, and they held that the plaintiff had not been validly expelled. It cannot, therefore, be asserted that the Privy Council held the matter of excommunication as a purely religious one. If it were so, the Courts would be out of the controversy. The same argument was advanced in another form by contending that excommunication is not a social question and that, therefore, article 25(2)(b) could not be invoked in aid of holding the Act to be constitutional. In this connection, it has to be 525 borne in mind that the Dai ul Mutlaq is not only the head of the religious community but also the trustee of the property of the community in which the community as a whole is interested. Even a theological head has got to perform acts which are not wholly religious but may be said to be quasi religious or matters which are connected with religious practices, though not purely religious. Actions of the Dai ul Mutlaq in the purely religious aspect are not a concern of the courts, but his actions touching the civil rights of the members of the community are justiciable and not outside the pale of interference by the legislature or the judiciary. I am not called upon to decide, nor am I competent to do so, as to what are the religious matters in which the Dai ul Mutlaq functions according to his religious sense. I am only concerned with the civil aspect of the controversy relating to the constitutionality of the Act, and I have to determine only that controversy. It has further been argued on behalf of the petitioner that an excommunicated person has not the right to say his prayers in the mosque or to bury his dead in the community burial ground or to the use of other communal property. Those may be the result of excommunication, but I am concerned with the question whether the Legislature was competent and constitutionally justified in enacting the law declaring excommunication to be void. As already indicated, I am not concerned in this case with the purely religious aspect of excommunication. I am only concerned with the civil rights of the members of the community, which rights they will continue to enjoy as such members if excommunication was held to be invalid in accordance with the provision of the Act. Hence, though the Act may have its repercussions on the religious aspect of excommunication, in so far as it protects the civil rights of the members of the community 526 it has not gone beyond the provisions of article 25(2)(b) of the constitution. Then it is argued that the guaranteed right of a religious denomination to manage its own affairs in matters of religion (article 26(b) is subject only to public order, morality and health and is not subject to legislation contemplated by article 25(2)(b). This very argument was advanced in the case of Shri Venkataramana Devaru vs The State of Mysore(1). At page 916 this argument has been specifically dealt with and negatived. This Court observed as follows: "The answer to this contention is that it is impossible to read any such limitation into the language of Art.25(2)(b). It applies in terms to all religious institutions of a public character without qualification or reserve. As already stated, public institutions would mean not merely temples dedicated to the public as a whole but also those founded for the benefit of sections thereof, and denominational temples would be comprised therein. The language of the Article being plain and unambiguous, it is not open to us to read into it limitations which are not there, based on a priori reasoning as to the probable intention of the Legislature. Such intention can be gathered only from the words actually used in the statute; and in a Court of law, what is unexpressed has the same value as what is unintended. We must therefore hold that denominational institutions are within article 25(2)(b). " In that case also, as in the present case, reference was made to the earlier decision of this Court in 527 The Commissioner, Hindu Religious endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt (1), but the latter decision had explained the legal position with reference to the earlier decision, and after examining the arguments for and against the proposition at pages 916 918, it has been distinctly laid down that article 26 (b) must be read subject to article 25 (2) (b) of the Constitution. It has further been contended that a person who has been excommunicated as a result of his non conformity to religious practices is not entitled to use the communal mosque or the communal burial ground or other communal property, thus showing that for all practical purposes he was no more to be treated as a member of the community, and is thus an outcast. Another result of excommunication is that no other member of the community can have any contacts, social or religious, with the person who has been excommunicated. All that is true. But the Act is intended to do away with all that mischief of treating a human being as a pariah, and of depriving him of his human dignity and of his sight to follow the dictates of his own conscience. The Act is, thus, aimed at fulfilment of the individual liberty of conscience guaranteed by article 25 (1) of the Constitution, and not in derogation of it. In so far as the Act has any repercussions on the right of the petitioner, as trustee of communal property, to deal with such property, the Act could come under the protection of article 26 (d), in the sense that his right to administer the property is not questioned, but he has to administer the property in accordance with law. The law, in the present instance, tells the petitioner not to withhold the civil rights of a member of the community to a communal property. But as against this it is argued on behalf of the petitioner that his right to excommunicate is so bound up with religion that it is protected by cl. (b) of article 26, and is thus completely out of the 528 regulation of law, in accordance with the provisions of cl. (d) of that Article. But, I am not satisfied on the pleadings and on the evidence placed before us that the right of excommunication is a purely religious matter. As already pointed out, the indications are all to the contrary, particularly the judgment to the Privy Council in the case of Hasanali vs Mansoorali (1) on which great reliance was placed on behalf of the petitioner. On the social aspect of excommunication, one is inclined to think that the position of an excommunicated person becomes that of an untouchable in his community, and if that is so, the Act in declaring such practices to be void has only carried out the strict injunction of article 17 of the Constitution, by which untouchability has been abolished and its practice in any form forbidden. The Article further provides that the enforcement of any disability arising out of untouchability shall be an offence punishable in accordance with law. The Act, in this sense, is its logical corollary and must, therefore, be upheld. In my opinion, it has not been established that the Act has been passed by a legislature which was not competent to legislate on the subject, or that it infringes any of the provisions of the Constitution. This petition must, therefore, fail. DAS GUPTA, J. In our opinion this petition should succeed. The petitioner is the head of the Dawoodi Bohras who form one of the several sub sects of the Shia sect of Musalmans. Dawoodi Bohras believe that, since the 21st Imam went to seclusion, the rights, power and authority of the Imam have been rightfully exercised by the Dai ul Imam as the vice regent of the Imam in seclusion. One of such rights is the exercise of disciplinary powers including the right to excommunicate any 529 member of the Dawoodi Bohra community. The existence of such a right in the Dai ul Mutlaq who is for the sake of convenience often mentioned as the Dai was questioned before the courts in a case which went up to the Privy Council. But since the decision of the Privy Council in that case, viz., Hasanali vs Mansoorali (1) that question may be taken to have been finally settled, and it is no longer open to dispute that the Dai, as the head of the Dawoodi Bohra community has the right to excommunicate any member of the community. The claim of the present petitioner to be the 51st Dai ul Mutlaq of the community was also upheld in that case and is no longer in dispute. The Privy Council had also to consider in that case the question whether this power to excommunicate could be exercised by the Dai in any manner he liked and held after consideration of the previous cases of excommunication and also a document composed about 1200 A.D. that normally members of the community can be expelled "only at a meeting of the Jamat after being given due warning of the fault complained of and an opportunity of amendment, and after a public statement of the grounds of expulsion. " Speaking about the effect of excommunication their Lordships said: "Excommunication. . necessarily involve exclusion from the exercise of religious rights in places under the trusteeship of the head of the community in which religious exercises are performed. " The present petitioner, it may be mentioned, was a party to that litigation. This decision was given on December, 1, 1947; shortly after that, the Bombay Legislature it may be mentioned that there is a large concentration of Dawoodi Bohras in the State of Bombay stepped in to prevent, as mentioned in the preamble, the practice of excommunication "which 530 results in the deprivation of legitimate rights and privileges of" members of certain religious communities and enacted the Bombay Act No. XLII of 1949. It is a short Act of six sections. Section 3 the main operative section invalidates all excommunication of members of any religious community. Excommunication is defined in section 2 to mean "the expulsion of a person from any community of which he is a member depriving him of rights and privileges which are legally enforceable by a suit of a civil nature by him or on his behalf as such member". The explanation to the definition to this section makes it clear that a right to office or property or to worship in any religious place or a right to burial or cremation is included as a right legally enforceable by suit even though the determination of such right may depend entirely on the decision of the question as to any religious rites or ceremonies or rule or usage of a community. Section 4 makes a person who does any act which amounts to excommunication or is in furtherance of the excommunication liable to punishment which may extend to one thousand rupees. Faced with the position that the legislation wholly destroys his right of excommunicating any member of the Dawoodi Bohra community, the Dai has presented this petition under article 32 of the Constitution. He contends that the Act violates the fundamental right of the Dawoodi Bohras, including himself, freely to practise religion according to their own faith and practice a right guaranteed by article 25 of the Constitution, and further that it violates the right of the Dawoodi Bohra community to manage its own affairs in matters of religion guaranteed by article 26. Therefore, says he, the Act is void and prays for a declaration that the Act is void and the 531 issue of an appropriate writ restraining the respondent, the State of Bombay, its officers, servants and agents from enforcing the provisions of the Act against the petitioner and/or any other member of the Dawoodi Bohra community. It may be mentioned that in the petition the legislative competence of the Bombay legislature to enact the Bombay Prevention of excommunication 1949 was also challenged. This, however was not pressed at the time of the hearing. The respondent contends that neither the right guaranteed under article 25 nor that under article 26(b) is contravened by the impugned Act. Briefly stated, the respondent 's case is that the right and privilege of the petitioner as Dai ul Mutlaq to regulate the exercise of religious rights do not include the right to excommunicate any person so as to deprive him of his civil rights and privileges. It was denied that the petitioner 's power to excommunicate was an essential part of the religion of the Dawoodi Bohra community and that the right has its foundation in religion and religious doctrines, tenets and faith of the Dawoodi Bohra community. It was also denied that the right to excommunicate is the religious practice and it was further pleaded that assuming that it was a religious practice, it was certainly not a part of religion of the Dawoodi Bohra community. The same points were urged on behalf of the intervener, except that the learned counsel for the intervener wanted to reopen the question whether the petitioner as the head of the Dawoodi Bohra community had the power to excommunicate. As already stated, however, this question is hardly open to dispute in the face of the decision of the Privy Council in Hasanali vs Mansoorali (1) and the point was not pressed. The content of articles 25 and 26 of the Constitution came up for consideration before this Court 532 in the Commissioner, Hindu Religious Endowments Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Matt (1); Mahant Jagannath Ramanuj Das vs The State of Orissa (2); Sri Venkatamana Devaru vs The State of Mysore (3); Durgah Committee, Ajmer vs Syed Hussain Ali (4) and several other cases and the main principles underlying these provisions have by these decisions been placed beyond controversy. The first is that the protection of these articles is not limited to matters of doctrine or belief they extend also to acts done in pursuance of religion and therefore contain a guarantee for rituals and observances, ceremonies and modes of worship which are integral parts of religion. The second is that what constitutes an essential part of a religious or religious practice has to be decided by the courts with reference to the doctrine of a particular religion and include practices which are regarded by the community as a part of its religion. Before however we can give a proper answer to the two questions raised, viz., (i) Has the impugned Act interfered with a right freely to practise religion and (ii) Has it interfered with the right of the Dawoodi Bohra Community to manage its own affairs in matters of religion; it is necessary to examine first the place of excommunication in the life of a religious community. Much valuable information about this is furnished by an article in the Encyclopaedia of the Social Sciences from the pen of Prof. Hazeltine. "Excommunication", says Prof. Hazeltine, in one or another of the several different meanings of the term has always and in all civilizations been one of the principal means of maintaining discipline within religious organizations and hence of preserving and strengthening their solidarity. " Druids in old Britain are said to have claimed the power to exclude offenders from sacrifice. The early Chiristian Church exercised 533 this power very largely and expelled and excluded from the Christian association, those members who proved to be unworthy of its aims or infringed its rules of governance. During the middle ages the Pope used this power frequently to secure the observance of what was considered the proper religious rights and practices of Christianity by excommunicating even the kings of some European countries when they introduced or tried to introduce different forms of divine worship. The power was often used not perhaps always fairly and justly, as a weapon in the struggle for the principle that the Church was above the State. Impartial historians have recognised, however, that many of the instances of excommunication were for the purpose of securing the adherence to the orthodox creed and doctrine of Christianity as pronounced by the Catholic Church. (Vide The Catholic Encyclopedia, Vol. V, articles on England and Excommunication). Turning to the Canon law we find that excommunication may be inflicted as a punishment for a number of crimes, the most serious of these being, heresy, apostasy or schism. Canon 1325, section 2 defines a heretic to be a man who while remaining nominally a Christian, pertinaciously denies or doubts any one of the truths which must be believed de fide divina et catholica; if he falls away entirely from the Christian faith, he is an apostate; finally if he rejects the authority of the Supreme Pontiff or refuses communion with the members of the Church who are subject to him, he is a schismatic. (Vide Canon Law by Bouscaren and Ellis). Among the Muslims also the right of excommunication appears to have been practised from the earliest times. The Prophet and the Imam, had this right; and it is not disputed that the Dais have also in the past exercised it on a number of 534 occasions. There can be little doubt that heresy or apostasy was a crime for which excommunication was in force among the Dawoodi Bohras also. It may be pointed out in this connection that excommunication in the case of Hasanali vs Mansoorali (1) which was upheld by the Privy Council) was based on the failure to comply with the tenets and traditions of the Dawoodi Bohra community and certain other faults. According to the petitioner it is "an integral part of the religion and religious faith and belief of the Dawoodi Bohra community" that excommunication should be pronounced by him in suitable cases. It was urged that even if this right to excommunicate is considered to be a religious practice as distinct from religious faith such religious practice is also a part of the religion of the Dawoodi Bohra community. It does appear to be a fact that unquestioning faith in the Dai as the head of community is part of the creed of the Dawoodi Bohras. It is unnecessary to trace the historical reason for this extraordinary position of the Dai as it does not appear to be seriously disputed that the Dai is considered to be the vice regent of Imam so long as the rightful Imam continues in seclusion. Mention must be made in this connection of the Mishak which every Dawoodi Bohra takes at the time of his initiation, This includes among other things, an oath of unquestioning faith in and loyalty to the Dai. It is urged therefore that faith in the existence of the disciplinary power of the Dai including his power to excommunicate forms one of the religious tenets of this community. The argument that article 25 has been contravened by the impugned Act is based mainly on this contention and the further contention that in any case excommunication is a religious practice in this community. As regards article 26(b) the argument is that excommunication among the 535 Dawoodi Bohras forms such an integral part of the management of the community by the religious head that interference with that right cannot but amount to an interference with the right of the community to the manage its own affairs in matters of religion. Let us consider first whether the impugned Act contravenes the provisions of article 26 (b). It is unnecessary for the purpose of the present case to enter into the difficult question whether every case of excommunication by the Dai on whatever grounds inflicted is a matter of religion. What appears however to be clear is that where an excommunication is itself based on religious grounds such as lapse from the orthodox religious creed or doctrine (similar to what is considered heresy, apostasy or schism under the Canon Law) or breach of some practice considered as an essential part of the religion by the Dawoodi Bohras in general, excommunication cannot but be held to be for the purpose of maintaining the strength of the religion. It necessarily follows that the exercise of this power of excommunication on religious grounds forms part of the management by the community, through its religious head, "of its own affairs in matters of religion. " The impugned Act makes even such excommunications invalid and takes away the power of the Dai as the head of the community to excommunicate even on religious grounds. It therefore, clearly interferes with the right of the Dawoodi Bohra community under cl. (b) of article 26 of the Constitution. That excommunication of a member of a community will affect many of his civil rights is undoubtedly true. This particular religious denomination is possessed of properties and the necessary consequence of excommunication will be that the excommunicated member will lose his rights of enjoyment of such property. It might be thought undesirable that the head of a religious community 536 would have the power to take away in this manner the civil rights of any person. The right given under article 26 (b) has not however been made subject to preservation of civil rights. The express limitation in article 26 itself is that this right under the several clauses of the article will exist subject to public order, morality and health. It has been held by this Court in Sri Venkataramana Devaru vs The State of Mysore (1) that the right under article 26(b) is subject further to cl. 2 of article 25 of the Constitution. We shall presently consider whether these limitations on the rights of a religious community to manage its own affairs in matters of religion can come to the help of the impugned Act. It is clear however that apart from these limitations the Constitution has not imposed any limit on the right of a religious community to manage its own affairs in matters of religion. The fact that civil rights of a person are affected by the exercise of this fundamental right under article 26(b) is therefore of no consequence. Nor is it possible to say that excommunication is prejudicial to public order, morality and health. Though there was a statement in paragraph 10 of the respondent 's counter affidavit that "the religious practice, which runs counter to the public order, morality and health must give way before the good of the people of the State", the learned Attorney General did not advance any argument in support of this plea. It remains to consider whether the impugned Act comes within the saving provisions embodied in cl. 2 of article 25. The clause is in these words: "Nothing in this Article shall affect the operation of any existing law or prevent the State from making any law 537 (a) regulating or restricting any economic, financial, political or other secular activity which may be associated with religious practice; (b) providing for social welfare and reform or the throwing open of Hindu religious institutions of a public character to all classes and sections of Hindus." Quite clearly, the impugned Act cannot be regarded as a law regulating or restricting any economic, financial, political or other secular activity. Indeed that was not even suggested on behalf of the respondent State. It was faintly suggested however that the Act should be considered to be a law "providing for social welfare and reform. " The mere fact that certain civil rights which might be lost by members of the Dawoodi Bohra community as a result of excommunication even though made on religious grounds and that the Act prevents such loss, does not offer sufficient basis for a conclusion that it is a law "providing for social welfare and reform. " The barring of excommunication on grounds other than religious grounds, say on the breach of some obnoxious social rule or practice might be a measure of social reform and a law which bars such excommunication merely might conceivably come within the saving provisions of cl. 2(b) of article 25. But barring of excommunication on religious grounds pure and simple, cannot however be considered to promote social welfare and reform and consequently the law in so far as it invalidates excommunication on religious grounds and takes away the Dai 's power to impose such excommunication cannot reasonably be considered to be a measure of social welfare and reform. As the Act invalidates excommunication on any ground whatsoever, including religious grounds, it must be held to be in clear violation of the right of the Dawoodi Bohra community under article 26(b) of the Constitution. 538 It is unnecessary to consider the other attack on the basis of article 25 of the Constitution. Our conclusion is that the Act is void being in violation of article 26 of the Constitution. The contrary view taken by the Bombay High Court in Taher Saifuddin vs Tyebbhai Moosaji (1) is not correct. We would, therefore, allow the petition, declare the Act to be void and direct the issue of a writ in the nature of mandamus on the respondent, the State of Bombay, not to enforce the provisions of the Act. The petitioner will get his costs. AYYANGAR, J. I agree that the petition should succeed and I generally concur in the reasoning of Das Gupta J., by which he has reached this conclusion. In view, however, of the importance of the case I consider it proper to state in my own words the grounds for my concurrence. It was not in dispute that the Dawoodi Bohras who form a sub sect of the Shia sect of Muslims is a "religious denomination" within the opening words of article 26 of the Constitution. There are a few further matters which were not in controversy on the basis of which the contentions urged in support of the petition have to be viewed. These might now be briefly stated: (1) It was the accepted tenet of the Dawoodi Bohra faith that God always had and still has a representative on earth through whom His commands are conveyed to His people. That representative was the Imam. The Dai was the representative of the Imam and conveyed God 's message to His people. The powers of the Dai were approximated to those of the Imam. When the Imam came out of seclusion, the powers of the Dai would cease. The chain of intercession with the Almighty was as follows: The Dai the Imam 539 the Holy Prophet and the one God (See Per Marten J. in Advocate General of Bombay vs Yusufalli Ebrahim (1). (2) The position and status of the petitioner as the Dai ul Mutlaq was not contested since the same had been upheld by the Privy council the decision reported as Hasanali vs Mansoorali (2). (3) It was not in dispute that subject to certain limitations and to the observance of particular formalities which were pointed out by the Privy Council in the decision just referred to, that the Dai ul Mutlaq has the power of excommunication and indeed, as observed by Lord Porter in that judgment, "the right of excommunication by a Dai ul Mutlaq was not so strenuously contested as were the limits within which it is confined." (4) The Dai ul Mutlaq was not merely a religious leader the religious head of the denomination but was the trustee of the property of the community. (5) The previous history of the community shows that excommunicated persons were deprived of the exercise of religious rights. It was contended before the Privy Council that the effect of an excommunication was in the nature merely of social ostracism but this was rejected and it was held to have a larger effect as involving an exclusion from the right to the enjoyment of property dedicated for the benefit of the denomination and of worship in places of worship similarly dedicated or set apart. The validity of Bombay Act 42 of 1949 (which I shall hereafter refer to as the impugned Act) has to be judged in the light of these admitted premises. Articles 25 and 26, which are urged as violated by the impugned Act run: 540 "25. (1) Subject to public order, morality and health and to the other provisions of this Part, all persons are equally entitled to freedom of conscience and the right freely to profess, practice and propagate religion. (2) Nothing in this article shall affect operation of any existing law or prevent the State from making any law (a) regulating or restricting any economic, financial, political or other secular activity which may be associated with religious practice; (b) providing for social welfare and reform or the throwing open of Hindu religious institutions of a public character to all classes and sections of Hindus. Explanation I. The wearing and carrying of kirpans shall be deemed to be included in the profession of the Sikh religion. Explanation II In sub clause (b) of clause (2), the reference to Hindus shall be construed as including a reference to persons professing the Sikh, Jaina or Buddhist religion, and the reference to Hindu religious institutions shall be construed accordingly. 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. " 541 I would add that these Articles embody the principle of religious toleration that has been the characteristic feature of Indian civilization from the start of history. the instances and periods when this feature was absent being merely temporary aberrations. Besides, they serve to emphasize the secular nature of Indian Democracy which the founding fathers considered should be the very basis of the Constitution. I now proceed to the details of the provisions of the impugned Act which are stated to infringe the rights guaranteed by these two Articles. The preamble to the impugned Act recites: "Whereas it has come to the notice of Government that the practice prevailing in certain communities of excommunicating its members is often followed in a manner which results in the deprivation of legitimate rights and privileges of its members; And whereas in keeping with the spirit of changing times and in the public interest, it is expedient to stop the practice; it is hereby enacted as follows : " Section 3 is the operative provision which enacts: "3. Notwithstanding anything contained in any law, custom or usage for the time being in force to the contrary, no excommunication of a member of any community shall be valid and shall be of any effect. " Section 4 penalises any person who does "any act which amounts to or is in furtherance of the excommunication" and subjects him to criminal 542 proceedings as regards which provision is made in sections 5 and 6. Section 2 contains two definitions: (1) of the word "community" which would include the religious denomination of Dawoodi Bohras, and (2) of "excommunication" as meaning: "the expulsion of a person from any community of which he is a member depriving him of rights and privileges which are legally enforceable by a suit of civil nature by him or on his behalf as such member; Explanation. For the purposes of clause a right legally enforceable by a suit of civil nature shall include the right to office or property or to worship in any religious place or a right of burial or cremation, notwithstanding the fact that the determination of such right depends entirely on the decision of the question as to any religious rites or ceremonies or rule or usage of a community. " The question to consider is whether a law which penalises excommunication by a religious denomination or by its head whether or not the excommunication be for non conformity to the basic essentials of the religion of that denomination and effects the nullification of such excommunication as regards the rights of the person excommunicated would or would not infringe the rights guaranteed by articles 25 and 26. First as to article 25, as regards cl (1) it was not in dispute that the guarantee under it protected not merely freedom to entertain religious beliefs but also acts done in pursuance of that religion, this being made clear by the use of the expression 543 "practice of religion". No doubt, the right to freedom of conscience and the right to profess, practise and propagate religion are all subject to "public order, morality or health and to the other provisions of this Part" but it was not suggested that (subject to an argument about the matter being a measure of social reform) the practice of excommunication offended public order, morality or health or any other part of the Constitution. Here is a religious denomination within Art.26. The Dai ul Mutlaq is its spiritual leader, the religious head of the denomination and in accordance with the tenets of that denomination he had invested in him the power to excommunicate dissidents. Pausing here, it is necessary to examine the rational basis of the excommunication of persons who dissent from the fundamental tenets of a faith. The identity of a religious denomination consists in the identity of its doctrines, creeds and tenets and these are intended to ensure the unity of the faith which its adherents profess and the identity of the religious views are the bonds of the union which binds them together as one community. As Smith B. said in Dill vs Watson (1) in a passage quoted by Lord Halsbury in Free Church of Scotland vs Overtoun (2) "In the absence of conformity to essentials, the denomination would not be an entity cemented into solidity by harmonious uniformity of opinion, it would be a mere incongruous heap of, as it were, grains of sand, thrown together without being united, each of these intellectual and isolated grains differing from every other, and the whole forming a but nominally united while really unconnected mass; fraught with nothing but internal dissimilitude, and mutual and reciprocal contradiction and dissension. " 544 A denomination within article 26 and persons who are members of that denomination are under in article 25 entitled to ensure the continuity of the denomination and such continuity is possible only may by maintaining the bond of religious discipline which would secure the continued adherence of its members to certain essentials like faith, doctrine, tenets and practices. The right to such continued existence involves the right to maintain discipline by taking suitable action inter alia of excommunicating those who deny the fundamental bases of the religion. The consequences of the exercise of that power vested in the denomination or in its head a power which is essential for maintaing the existence and unity of denomination must necessarily be the exclusion of the person excommunicated from participation in the religious life of the denomination, which would include the use of places of worship or consecrated places for burial dedicated for the use of the members of the denomination and which are vested in the religious head as a trustee for the denomination. The learned Attorney General who appeared for the respondent submitted three points: (1) Assuming that excommunication was part of the religious practice of the denomination, still there was no averment in the petition that the civil results flowing from excommunication in the shape of exclusion from the beneficial use of denominational property was itself a matter of religion. In other words, there was no pleading that the deprivation of the civil rights of a person excommunicated was a matter of religion or of religious practice. (2) The "excommunication" defined by the Act deals with rights of civil nature as distinguished from religious or social rights or obligations and a law dealing with the civil consequence of an excommunication does not violate the freedom protected by article 25 or article 26. (3) Even on the basis that the civil consequences of an excommunication are a matter of religion, still it is a 545 measure of social reform and as such the legislation would be saved by the words in article 25(2)(b). I am unable to accept any of these contentions as correct. (1) First I do not agree that the pleadings do not sufficiently raise the point that if excommunication was part of the "practice of a religion" the consequences that flow therefrom were not also part of the "practice of religion". The position of the Dai as the religious head of the denomination not being disputed and his power to excommunicate also not being in dispute and it also being admitted that places of worship and burial grounds were dedicated for the use of the members of the denomination, it appears to me that the consequence of the deprivation of the use of these properties by persons excommunicated would be logical and would flow from the order of excommunication. It could not be contested that the consequence of a valid order of excommunication was that the person excommunicated would cease to be entitled to the benefits of the trusts created or founded for the denomination or to the beneficial use or enjoyment of denominational property. If the property belongs to a community and if a person by excommunication ceased to be a member of that community, it is a little difficult to see how his right to the enjoyment of the denominational property could be divorced from the religious practice which resulted in his ceasing to be a member of the community. When once it conceded that the right guaranteed by article 25 (1) is not confined to freedom of conscience in the sense of the right to hold a belief and to propagate that belief, but includes the right to the practice of religion, the consequences of that practice must also bear the same complexion and be the subject of a like guarantee. (2) I shall reserve for later consideration the point about the legislation being saved as a matter 546 of social reform under article 25(2)(b), and continue to deal with the argument that the impugned enactment was valid since it dealt only with the consequences on the civil rights, of persons excommunicated. It has, however, to be pointed out that though in the definition of "excommunication" under section 2(b) of the impugned Act the consequences on the civil rights of the excommunicated persons is set out, that is for the purpose of defining an "excommunication". What I desire to point out is that it is not as if the impugned enactment saves only the civil consequences of an excommunication not interfering with other consequences of an excommunication falling within the definition. Taking the case of the Dawoodi Bohra community, if the Dai excommunicated a person on the ground of forswearing the basic tenets of that religious community the Dai would be committing an offence under section 4, because the consequences according to the law of that religious denomination would be the exclusion from civil rights of the excommunicated person. The learned Attorney General is therefore not right in the submission that the Act is concerned only with the civil rights of the excommunicated person. On the other hand, it would be correct to say that the Act is concerned with excommunications which might have religious significance but which also operate to deprive persons of their civil rights. Article 26 confers on every religious denomination two rights which are relevant in the present context, by cl. (b) "to manage its own affairs in matters of religion" and by the last clause cl. (d) "to administer such property" which the denomination owns or has acquired (vide cl. (c) (d) "in accordance with law. " In considering the scope of article 26 one has to bear in mind two basic postulates: First that a religious denomination is possessed of property which is dedicated for definite uses and which under article 26 (d) the religious 547 denomination has the right to administer. From this it would follow that subject to any law grounded on public order, morality or health the limitations with which article 26 opens, the denomination has a right to have the property used for the purposes for which it was dedicated. So far as the present case is concerned, the management of the property and the right and the duty to ensure the proper application of that property is admitedly vested in the Dai as the religious head of the denomination. Article 26 (d) speaks of the administration of the property being in accordance with law and the learned Attorney General suggested that a valid law could be enacted which would permit the diversion of those funds to purposes which the legislature in its wisdom thought it fit to appropriate. I feel wholly unable to accept this argument. A law which provides for or permits the diversion of the property for the use of persons who have been excluded from the denomination would not be "a law" contemplated by article 26(d). Leaving aside for the moment the right of excommunicated persons to the enjoyment of property dedicated for the use of a denomination let me take the case of a person who has renounced that religion, and in passing it might be observed that even in cases of an apostate according to the principles governing the Dawoodi Bohra denomination there is no ipso facto loss of rights, only apostasy is a ground for excommunication which however could take place without service of notice or an enquiry. It could not be contended that an apostate would be entitled to the beneficial use of property, dedicated to the Dawoodi Bohra community be it the mosque where worship goes on or other types of property like consecrated burial grounds etc. It would be obvious that if the Dai permitted the use of the property by an apostate without excommunicating him he would be committing a dereliction of his duty as the supreme head 548 of the religion in fact an act of sacrilege besides being guilty of a breach of trust. I consider that it hardly needs any argument to show that if a law permitted or enjoined the use of the property belonging to the denomination by an apostate it would be a wholly unauthorised diversion which would be a violation of article 26(d) and also of article 26(c), not to speak of article 25(1). The other postulate is the position of the Dai as the head of the religious denomination and as the medium through which spiritual grace is brought to the community and that this is the central part of the religion as well as one of the principal articles of that faith. Any denial of this position is virtually tantamount to a denial of the very foundation of the faith of the religious denomination. The attack on the constitutionality of the Act has to be judged on the basis of these two fundamental points. The practice of excommunication is of ancient origin. History records the existence of that practice from Pagan times and Aeschyles records "The exclusion from purification with holy water of an offender whose hands were defiled with bloodshed. " Later the Druids are said to have claimed the right of excluding offenders from sacrifice. Such customary exclusions are stated to have obtained in primitive semitic tribes but it is hardly necessary to deal in detail with this point, because so far as the Muslims, and particularly among the religious denomination with which this petition is concerned, enough material has been set out in the judgment of the Privy Council already referred. Pausing here, it might be mentioned that excommunication might bear two aspects: (1) as a punishment for crimes which the religious community justifies putting one out of its fold. In this connection it may be pointed out that in a theocratic State the punitive aspect of excommunication 549 might get emphasized and might almost take the form of a general administration by religious dignitaries of ordinary civil law. But there is another aspect which is of real relevance to the point now under consideration. From this point of view excommunication might be defined as the judicial exclusion from the right and privileges of the religious community to whom the offender belongs. Here it is not so much as a punishment that excommunication is inflicted but is used as a measure of discipline for the maintenance of the integrity of the community, for in the ultimate analysis the binding force which holds together a religious community and imparts to it a unity which makes it a denomination is a common faith, common belief and a belief in a common creed, doctrines and dogma. A community has a right to insist that those who claim to be within its fold are those who believe in the essentials of its creed and that one who asserts that he is a member of the denomination does not, at least, openly denounce the essentials of the creed, for if everyone were at liberty to deny these essentials, the community as a group would soon cease to exist. It is in this sense that it is a matter of the very life of a denomination that it exercises discipline over its members for the purpose of preserving unity of faith, at least so far as the basic creed or doctrines are concerned. The impugned enactment by depriving the head of the power and the right to excommunicate and penalising the exercise of the power, strikes at the very life of the community by rendering it impotent to protect itself against dissidents and schismatics. It is thus a violation of the right to practice religion guaranteed by article 25(1) and is also violative of article 26 in that it interfers with the rights of the Dai as the trustee of the property of the denomination to so administer it as to exclude dissidents and excommunicated persons from the beneficial use of such property. 550 It is admitted however in the present case that the Dai as the head of the denomination has vested in him the power, subject to the procedural requirements indicated in the judgment of the Privy Council, to excommunicate such of the members of the community as do not adhere to the basic essentials of the faith and in particular those who repudiate him as the head of the denomination and as a medium through which the community derives spiritual satisfaction or efficiency mediately from the God head. It might be that if the enactment had confined itself to dealing with excommunication as a punishment for secular offences merely and not as an instrument for the self preservation of a religious denomination the position would have been different and in such an event the question as to whether articles 25 and 26 would be sufficient to render such legislation unconstitutional might require serious consideration. That is not the position here. The Act is not confined in its operation to the eventualities just now mentioned but even excommunication with a view to the preservation of the identity of the community and to pervent what might be schism in the denomination is also brought within the mischief of the enactment. It is not possible, in the definition of excommunication which the Act carries, to read down the Act so as to confine excommunication as a punishment of offences which are unrelated to the practice of the religion which do not touch and concern the very existence of the faith of the denomination as such. Such an exclusion cannot be achieved except by rewriting the section. The next question is whether the impugned enactment could be sustained as a measure of social welfare and reform under article 25 (2) (b). The learned Attorney General is, no doubt, right in his submission that on the decision of this Court in the 551 Mulki Temple case (Venkataramana Devaru vs State of Mysore(1), the right guaranteed under article 26(b) is subject to a law protected by article 25(2)(b) The question then before the Court related to the validity of a law which threw open all public temples, even those belonging to "a religious denomination" to "every community of Hindus including 'untouchable ' " and it was held that, notwithstanding that the exclusion of these communities from worship in such a temple was an essential part of the "practice of religion" of the denomination, the constitutionality of the law was saved by the second part of the provision in article 25(2)(b) reading: "the throwing open of Hindu religious institutions of a public character to all classes and section of Hindus". The learned Attorney General sought support from this ruling for the proposition that article 25(2)(b) could be invoked to protect the validity of a law which was "a measure of social welfare and reform" notwithstanding that it involved an abrogation of the whole or part of the essentials of a religious belief or of a religious practice. I feel unable to accept the deduction as flowing from the Mulki Temple case. That decision proceeded on two bases : (1) As regards the position of "untouchables", article 17 had made express provision stating: " 'Untouchability ' is abolished and its practice in any form is forbidden. The enforcement of any disability arising out of 'Untouchability ' shall be an offence punishable in accordance with law." and that had to be recognised as a limitation on the rights of religious denominations however basic and essential the practice of the exclusion of untouchables might be in its tenets or creed. (2) There was a special saving as regards laws providing for "throwing open of public Hindu Religious Institu 552 tions to all classes and sections of Hindus" in article 25(2)(b), and effect had to be given to the wide language in which this provision was couched. In the face of the language used, no distinction could be drawn between beliefs that were basic to a religion, or religious practices that were considered to be essential by a religious sect, on the one hand, and on the other beliefs and practices that did not form the core of a religion or of the practices of that religion. The phraseology employed cut across and effaced these distinctions. But very different considerations arise when one has to deal with legislation which is claimed to be merely a measure "providing for social welfare and reform". To start with, it has to be admitted that this phrase is as contrasted with the second portion of article 25(2)(b), far from precise and is flexible in its content. In this connection it has to be borne in mind that limitations imposed on religious practices on the ground of public order, morality or health have already been saved by the opening words of article 25(1) and the saving would cover beliefs and practices even though considered essential or vital by those professing the religion. I consider that in the context in which the phrase occurs, it is intended to save the validity only of those laws which do not invade the basic and essential practices of religion which are guaranteed by the operative portion of article 25(1) for two reasons: (1) To read the saving as covering even the basic essential practices of religion, would in effect nullify and render meaningless the entire guarantee of religious freedom a freedom not merely to profess, but to practice religion, for very few pieces of legislation for abrogating religious practices could fail to be subsumed under the caption of "a provision for social welfare or reform". (2) If the phrase just quoted was intended to have such a wide operation as cutting at even the essentials guaranteed by article 25(1), there 553 would have been no need for the special provision as to "throwing open of Hindu religious institutions" to all classes and sections of Hindus since the legislation contemplated by this provision would be par excellence one of social reform. In my view by the phrase "laws providing for social welfare and reform" it was not intended to enable the legislature to "reform", a religion out of existence or identity. Article 25 (2)(a) having provided for legislation dealing with "economic, financial, political or secular activity which may be associated with religious practices", the succeeding clause proceeds to deal with other activities of religious groups and these also must be those which are associated with religion. Just as the activities referred to in article 25(2)(a) are obviously not of the essence of the religion, similarly the saving in article 25(2)(b) is not intended to cover the basic essentials of the creed of a religion which is protected by article 25(1). Coming back to the facts of the present petition, the position of the Dai ul Mutlaq, is an essential part of the creed of the Dawoodi Bohra sect. Faith in his spiritual mission and in the efficacy of his ministration is one of the bonds that hold the community together as a unit. The power of excommunication is vested in him for the purpose of enforcing discipline and keep the denomination together as an entity. The purity of the fellowship is secured by the removal of persons who had rendered themselves unfit and unsuitable for membership of the sect. The power of excommunication for the purpose of ensuring the preservation of the community, has therefore a prime significance in the religious life of every member of the group. A legislation which penalises this power even when exercised for the purpose above indicated cannot be sustained as a measure of social welfare or social reform without eviscerating the 554 guarantee under article 25(1) and rendering the protection illusory. In my view the petitioner is entitled to the relief that he seeks and the petition will accordingly be allowed. BY COURT: In accordance with the majority view of this Court, the petition is allowed. The petitioner is entitled to his costs. Petition allowed.

section 3 of the Bombay Prevention of Excommunication Act, 1949 (Bom. 42 of 1949), it is provided that "Notwithstanding anything contained in any law, custom or usage for the time being in force, to the contrary, no excommunication of member of any community shall be valid and shall be of any effect. " The preamble to the Act state, inter alia, that in keeping with the changing times and in the public interest, it was expedient to stop the practice of excommunication prevalent in certain communities and the definition of the word "community" contained in section 2 of the Act included the included the religious denomination of Dawoodi Bohras. The petitioner, who was the religious head of the Dawoodi Bohra community and trustee of its property, challenged the constitutional validity of the Act on the ground that it violated its fundamental rights guaranteed by articles 25 and 26 of the Constitution. Reliance was placed on behalf of the petitioner on the decision of Judicial Committee of the Privy Council in Hasan Ali vs Mansoor Ali, (1947) L. R. 75 I.A. 1, to which he was a party, as recognising his right as the 51st Dai ul Mutlaq of the community to excommunicate any of its members under prescribed limits. ^ Held, (Per Sarkar, Das Gupta and Mudholkar, JJ., Sinha, C. J., dissenting), that the impugned Act violated articles 25 and 26 of the Constitution and was, therefore, void. It was evident from the religious faith and tenets of the Dawoodi Bohra community that the exercise of the power of excommunication by its religious head on religious grounds formed part of the management of its affairs in matters of religion and the impugned Act in making even such excommunication invalid infringed the right of the community under article 26(b) of the Constitution. Hasan Ali vs Mansoorali, (1947) L. R. 75 I. A. 1, referred to. 497 It is well settled that that articles 25 and 26 of the Constitution protect not merely religious doctrines and beliefs but also acts done in pursuance of religion and thus guarantee rituals and observances, ceremonies and modes of worship which are integral parts of religion. What is essential part of a religion or what its religious practice has to be judged in the light of its doctrine and such practices as are regarded by the community as a part of its religion must also be included in them. Commissioner of Hindu Religious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shrur Mutt, ; , Mahant Jagannath Ramanuj Das vs The State of Orissa, [1954] S.C.R. 1046, Sri Venkataramana Devaru vs State of Mysore, ; and Durgah Committee, Ajmer vs Syed Hussain Ali; , , relied on. The fundamental right under article 26(b) is not subjected to preservation of civil rights and its only limitations are those expressly mentioned by the Article itself i.e. public order, morality and health and those mentioned by cl. 2 of article 25 as has been held by this court. The fact that in the instant case civil rights of an excommunicated person would be affected by the exercise of the fundamental right under article 26(b) can, therefore, be of no consequence nor could it be said that excommunication was prejudicial to public order, morality and health. The impugned Act did not fall within article 25(2)(a) nor could it be said to be a law "providing for social welfare and reform" within the meaning of article 25(2)(b) of the Constitution. It barred excommunication even on religious grounds and could not be said to promote social welfare and reform even though it sought to prevent consequent loss of civil rights. Sri Venkataramana Devaru vs State of Mysore, ; , referred to. Taher Saifuddin vs Tyebbhai Moosaji, A. I. R. , disapproved. Per Sinha, C. J. It was not correct to say that the Privy Council in Hasanali vs Mansoorali, held that the right of the Dai ul Mutlaq to excommunicate a member of the community was a purely religious matter. The Dai was not merely the head of a religious community but also the trustee of its property. While his actions in the purely religious aspect could be no concern of the Courts, those touching the civil rights of the members of the community were justiciable and liable to interference by the legislature and the judiciary. 498 The impugned Act, therefore, in seeking to protect the civil rights of the members of the community was within the saving provisions of article 25(2) (b) of the constitution since the right of a religious denomination under article 26(b) was subject to legislation under article 25(2)(b) of the Constitution. Sri Venkataramana Devaru vs State of Mysore, ; , relied on. The Commissioner of Hindu Religious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shrur Mutt, ; , considered. The Durgah Committee, Ajmer vs Syed Hussain Ali, ; , referred to. Case law discussed. The Act had for its purpose the fulfilment of individual liberty of conscience guaranteed by Art 25(1) and sought to implement article 17 of the Constitution in attempting to save an excommunicated person from virtually becoming an untouchable in his community and its constitutional validity could not, therefore, be questioned. Held, further, that the Act in pith and substance fell within Entries 1 and 2 of List III of the Legislative Lists of the Constitution Act of 1935, and there could be no doubt as to the competency of the Legislature in enacting it. Per Ayyangar, J. The right of Dai ul Mutlaq to exercise the right of excommunication against a member of the denomination as recognised by the Privy Council in Hasanali vs Mansoorali, could not be in doubt. A denomination under article 26 and its members under article 25 have the right to ensure its existence by maintaining discipline and ensuring adherence to its tenets and practices by such suitable action as excommunication of those who denied the fundamental bases of the religion. The consequence of such action must necessarily involve the exclusion of an excommunicated person from participation in the religious life of the denomination including the use of places of worship or burial grounds dedicated for the use of the members and vested in the religious head as trustee for the denomination. Dill vs Watson, (1836) 3 Jones Rep. (Ir. exhibit) 48 and Free Church of Scotland vs Overtoun, , referred to. It was not correct to say, in view of the definition of the word 'excommunication ' contained in the Act., that it merely sought to save the civil rights of an excommunicated person and had no concern with excommunication on religious 499 grounds entailing, under the laws of the denomination, deprivation of civil rights. The impugned Act by depriving the Dai of the right to excommunicate and making its exercise a penal offence struck at the very life of the denomination and rendered it impotent to protect itself against dissidents and schismatics and thereby contravened article 25 and 26 of the Constitution. The impugned Act cannot also to sustained as a measure of social welfare and reform under article 25(2)(b) or under article 17 of the Constitution. Venkatarama Devaru vs State of Mysore, ; , distinguished. The expression "laws providing for social welfare and reform" in article 25(2)(1) of the Constitution was not intended to enable the legislature to "reform" a religion out of existence or identity. The activities referred to in article 25(2)(a) are obviously not of the essence of the religion nor was article 25(2)(b) intended to cover the essentials of a religion which are protected by article 25(1). Faith in the Dai ul Mutlaq being an essential part of the creed of the denomination that held it together, the impugned Act clearly contravened article 25(1) of the Constitution by taking away his power of excommunicate by which he kept the denomination together and maintained the purity of its fellowship.

Civil Appeals Nos. 201 and 202 of 1961. 404 Appeals from the judgment and decree dated May, 16, 1958 of the Patna High Court in L. P. As. Nos 13 and 14 of 1957. A. V. Viswanatha Sastri, R. K. Garg, M. K. Ramamurthi, D. P. Singh and section C. Agarwala, for the appellants. M. C. Setalvad, Attorney General for India. B. P. Rajgarhia and K. K. Sinha, for the respondents. December 22. The Judgment of the Court was delivered by DAS GUPTA, J. These appeals raise a question as to the manner in which a creditor company can validly cast its vote at a meeting of the creditors held under the provisions of section 153 of the Indian Companies Act, 1913. The question arises in connection with such a meeting held of the creditors of the Gaya Sugar Mills Ltd. On November 14, 1951, an order was made by the Company Judge in the Patna High Court for the winding up of the Gaya Sugar Mills Ltd. On October 6, 1953, an order was made by the learned Judge for action to be taken under section 153 of the Indian Companies Act. Mr. G. C. Banerjee, who was appointed Chairman to hold the meeting of the creditors held separate meetings of the debenture holders, secured creditors and of the unsecured creditors. In his Report he stated as regards the meeting of the unsecured creditors that "thirty unsecured creditors either in person or through proxy attended and took part in the meeting," and that ultimately a resolution proposed by one of the creditors, the Standard Vacuum Oil Company and seconded by another creditor Shri K. C. Agarwal was passed "by the creditors present by majority in number as well as three fourth in value. " It appears that at this meeting one Arjun Prasad claiming to represent two creditor companies, viz., Bhandani Bros., and the Hindustan 405 Coal Company Ltd., cast his votes on behalf of these two companies, in support of the resolution. No objection was taken at the meeting to the validity of these votes by any of the creditors who opposed the resolution and the Chairman proceeded on the basis that these votes were validly cast. It is not disputed that if these votes were not validly cast the requisite majority of three fourths in value would not be obtained. When the application came up for final hearing before the Court an objection was taken on behalf of creditors who opposed the scheme that the votes cast by Arjun Prasad on behalf of the two creditor companies, viz., Bhandani Brothers and the Hindustan Coal Company were not valid votes and so the requisite majority of three fourths in value of the creditors had not been obtained. The Company Judge was of the opinion that there was no sufficient explanation as to why the objection as to the validity of the votes was not taken earlier and so the objection raised at the late stage could not be entertained. On the merits also he held that the resolution passed by the creditor companies authorising Arjun Prasad, to attend the meeting of the unsecured creditors of the Gaya Sugar Mills Ltd., and vote on behalf of the companies, were sufficient in law to make his attendance at the meeting the attendance of the companies "in person" and his voting on behalf of the companies valid voting of the companies. Accordingly, he rejected this objection. On appeal a Division Bench of the Patna High Court has allowed the objection, being of opinion that the delay in raising the objection would not entitle the Court to ignore the legal defect of the votes and that in law the votes cast by Arjun Prasad were not valid votes of these two creditor companies, viz., Bhandani Brothers and the Hindustan Coal Company. A contention that no appeal 406 lay to the High Court from the order of the Company Judge was rejected. Therefore, the learned Judges set aside the order of the Company Judge as to this part of the case. They, however, gave a certificate that as regards the value and nature of the case, it fulfils the requirements of article 133(1)(a) of the Constitution and is a fit one for appeal to this Court. On this certificate the present appeals have been filed. Three points were raised before us by Mr. Sastri in support of the appeals. The first is that from the decision of the Company Judge, an appeal lay to this Court and not to the High Court. Secondly, it was urged that the objection to the validity of the votes not having been taken earlier should not be allowed to be raised for the first time during arguments at the final hearing of the application. Lastly, it was urged that the votes were valid. As regards the first point it is to be noticed that sub section 7 of section 153, which was added in 1936 provides that an appeal shall lie from any order made by the court exercising original jurisdiction under the section to the authority authorised to hear appeals from the decisions of the Court. It therefore could not be disputed and was not disputed that an appeal did lie from the order made by the Company Judge on October 6, 1953. The controversy is whether the appeal lay to this Court or the High Court. In other words, the question is, which is the authority authorised to hear appeals from the decisions of the Court ? The "Court" here cannot but mean the Court exercising original jurisdiction. When the Company Judge exercises the jurisdiction he does it under the provisions of section 3 of the Companies Act which says 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. The authority authorised to hear appeals from 407 appealable decisions of a Single Judge of the Patna High Court when exercising original jurisdiction lie to the High Court and not to this Court. (Vide Clause 10 of the Letters Patent). It necessarily follows that the appeal from the order of the Company Judge lay to the High Court and not to this Court. There is, therefore, no substance in the first point raised on behalf of the appellant. The next contention that the objection cannot be entertained for the first time at the final hearing of the application appears to us to be equally unsound. It is undoubtedly true that the opposing creditors were guilty of negligence in not drawing the attention of the Chairman to what they considered to be a defect in the voting on behalf of the two creditor companies, viz., Bhandani Brothers and the Hindustan Coal Co., and no less negligence in not bringing this to the Court 's notice at the earliest opportunity. Laches on the part of some creditors cannot however justify the Chairman or the Court in disobeying the requirements of the Act. If in law the two votes cast by Arjun Prasad for these two creditor companies were not validly cast he three fourth majority requisite under section 153, sub section 2, would not be there and so no further action under section 153 could be taken by the Court in the matter. How can the Court turn a blind eye to the fact, if proved, that on the basis of valid votes at the meeting the requisite majority was not obtained, merely because the Chairman 's attention was not drawn to the defect or it was not brought to the Court 's notice earlier ? In our opinion, the learned Judges who heard the appeal were right in thinking that however deplorable the delay by opposing creditors in raising the objection might be, that would not be a sufficient reason for refusing to entertain the objection. This brings us to the main question in controversy, viz., whether the resolutions passed by the 408 two creditor companies, viz., Bhandani Brothers and the Hindustan Coal Company, authorising Arjun Prasad to attend the meeting on their behalf and to vote there on their behalf made Arjun Prasad 's voting valid voting. Section 153(2) of the Indian Companies Act is in these words : "If a majority in number representing three fourths in value of the creditors or class of creditors, or members or class of members, as the case may be, present either in person, or by proxy at the meeting, agree to any compromise or arrangement, the compromise or arrangement shall, if sanctioned by the Court be binding on all the creditors or the class of creditors, or on all members or class of members, as the case may be, and also on the company, or, in the case of a company in the course of being wound up, on the liquidator and contributories of the Company. " The agreement has to be of a majority in number representing three fourths in value of those who are present either in person or by proxy at the meeting. The agreement of those who are not present at the meeting either in person or by proxy cannot be taken into consideration. Any creditor whether a corporation or a natural person can be present at a meeting by proxy. A natural person can of course be present at a meeting "in person". Can a corporation be present at a meeting "in person"? It appears to us that unless there is some special provision by a law, a company which is not a physical person cannot "be present" at any place "in person. " It is true that under the , a company is a "Person", so that whenever the word "person" is used in any statute a company would be included thereunder. The definition in the can however be of no assistance in interpreting the words "to be present in person", and the difficulty in the way of a company being present in person can be obviated only by statutory provisions or rules having the force of law. 409 Nor can the appellant derive any assistance from the English Case In re Kelantan Coco, Limited and Reduced cited by the learned counsel. In that case, the Court was dealing with a petition for reduction of capital. In deciding whether the special resolution to reduce the capital of the company had been duly passed, the Court had to consider whether there was a quorum at the confirmatory meeting, at which one member of the company and one representative appointed under s.68 of the Companies (Consolidation) Act, 1908, to represent a shareholder of the company, the Eastern Development Corporation, Limited, were present. The articles of Association provided: "two members personally present shall be a quorum. " It was held that a representative appointed under section 68 should be taken into account in considering whether there was a quorum. The provisions of section 68 were similar to those of section 80 of the Indian Companies Act, 1913, and thereunder a company which is a member of another company may, act as its representative at any meeting of that other company. The presence of such a representative was taken in the above case to amount to personal presence of a member of the company. The case does not deal with the question of a creditor company. In the , a provision has been introduced under which a company which is a creditor of another company may by resolution of its directors, authorises such person as it thinks fit to act its representative at any meeting of any creditors of the company held in pursuance of the Act and a person authorised in this manner shall be entitled to exercise the same rights and powers (including the right to vote by proxy) on behalf of the company, (section 187(1)(b) and 2). No such provision however is to be found in the Indian Companies Act, 1913. It is unnecessary for us to 410 consider whether under this new provision the attendance of a person authorised in this manner at a meeting of the creditors will amount to attendance of the creditor company "in person". For, the present case is governed by the provisions of the Indian Companies Act, 1913, and not by this new provision. When the Companies Act was amended in 1936, an addition was made in section 246 which empowers the High Court to make rules, concerning the mode of proceedings inter alia "for the holding of meetings of creditors and members in connection with proceedings under section 153 of this Act." Accordingly, a number of Rules were framed by the Patna High Court in exercise of this additional power. Rule 144 of the Rules states that a creditor or contributor may vote either in person or by proxy. Rules 145 to 153 deal with various questions as regards proxies. Of these Rule 150 lays down how a proxy is to be given where a creditor is a corporation. Admittedly, no proxy in accordance with Rule 150 was given by the two creditor companies, Bhandani Brothers and the Hindustan Coal Company, in the present case. There is nothing in these rules which can assist Mr. Sastri 's argument that a resolution by the directors of the company authorising a director or some other person to represent the company at the creditors ' meeting makes him a "present in person" in law for that company at the meeting. Mr. Sastri 's last argument was that as the business of the company has to be managed by the directors and the directors can delegate any of their powers to any one of themselves, the attendance of Arjun Prasad at the meeting should reasonably be construed as the attendance of all the directors and so the attendance of the company "in person". As we have already indicated it does not appear to us that in the Act of 1913 their is any provision 411 for attendance of the company "in person", but apart from that we wish to point out that the resolution made by the two companies do not appear to us to delegate the powers of the directors to Arjun Prasad. The conclusion of the High Court that the votes cast by Arjun Prasad on behalf of the two companies., viz., Bhandani Brothers and the Hindustan Coal Company, were not valid votes in our opinion, correct. The appeals are accordingly dismissed with costs. One set of hearing fee. Appeals dismissed.

Subsequent to an order made for the winding up of a company, the Company Judge made a direction for action to be taken under provisions of section 153 of the Indian Companies At the meeting of the unsecured creditors of the company a resolution was passed by the creditors present, either in person or through proxy, by majority in number as well as three fourths in value. At this meeting the appellant claiming to represent two of the creditor companies cast his votes on behalf of the said companies in support of the resolution. No objection was taken at the meeting to the validity of the votes by any of the creditors who opposed the resolution. When the matter came up for orders before the Company Judge an objection was raised that the votes cast by the appellant on behalf of the two creditor companies were not valid, inasmuch as section 153(2) of the Act requires that the creditors should be present either in person or by proxy at the meeting and that, in the present case, the two creditor companies, being corporations, could not be considered to have been present at the meeting "in person". The Company Judge overruled the objection on the grounds that it was raised at a late stage and that, in any case, the votes were valid because the appellant 's attendance at the meeting amounted to the attendance of the companies "in person". On appeal, a Division Bench of the Patna High Court rejected the contention that no appeal lay to the High Court from the order of the Company Judge but only to the Supreme Court and, on the merits, set aside his order. ^ Held, that: (1) the word "Court" in section 153(7) of the Indian Companies Act, 1913, means the Court exercising original jurisdiction, and. therefore, an appeal from the order of the Company Judge lay to the High Court under cl. 10 of the Letters Patent; (2) though under the , a company is a "person" so that whenever the word "person" is used in any statute a company would be included thereunder, unless there is some special provision by a law a company which is not a physical person cannot "be present" at any place "in person"; and (3) in the present case the votes cast by the appellant were not valid in law and it being admitted that if the votes were invalid the requisite majority of three fourths in value requisite under section 153(2) of the Indian Companies Act, 1913, would not be obtained and therefore no further action could be taken by the Court in the matter, the delay in raising the objection would not entitle the Court to ignore the legal defect of the votes.

iminal Appeal No. 79 of 1952. Appeal by special leave from & Judgment and Order dated 16th April, 1951, of the High Court of Judicature at Allahabad Dayal and Desai JJ.) in Criminal Miscellaneous No. 17 of 1950. K. section Krishnaswami Iyengar (H. B. Asthana, with him) for the appellants. N. C. Sen for the respondent. February 5. The Judgment of the Court was delivered by MAHAJAN J. This is an appeal by special leave from the judgment and order dated the 16th April, 1951 of the Allahabad High Court in Criminal Miscellaneous Petition No. 17 of 1950. The two appellants are members of the Uttar Pradesh Civil Service. 583 In March, 1950, appellant No. 1 (Rizwan ul Hasan) was posted as District Magistrate, Jalaun, and appellant No. 2, Mohammad Munawar, was posted as a Magistrate in the same district, having officiated as District Magistrate for some time in the early part of March, 1960. On 2nd March, 1,950, one Phundi Singh commenced proceedings under section 145 of the Code of Criminal Procedure in the Court of the Sub Divisional Magistrate of Jalaun on the allegation that Kedarnath and Matadin were about to cut his standing crop by force and 'that there was an imminent danger of a breach of the peace. The magistrate issued notices to the parties complained against and ordered attachment of the standing crop. On 4th March, 1950, one Shriram, brother of Kedarnath, filed a counter application before the court making certain allegations against one Thakur Pratap Singh, said to be the real person behind the proceedings commenced by Phundi Singh. Kedarnath and Matadin, the respondents in Phundi Singh 's application, also filed an application similar to that of Shriram before the District Magistrate on the same date. This application was accompanied by a recommendatory letter written to the District Magistrate by Lalla Ram Dwivedi, Secretary, District Congress Committee. It was received by the second appellant who was then officiating as District Magistrate and was sent by him to the Sub Divisional Magistrate, Jalaun, in whose court Phundi Singh 's application was pending, for report. The Sub Divisional Magistrate returned it with the remark that a proper com plaint should be made in his court in the ordinary way on the allegations made in the application. Thereupon the second appellant returned the application to Kedarnath and Matadin and advised them to move the Sub Divisional Magistrate in as formal and proper manner. On the application of Phundi Singh made before the High Court of Allahabad under section 3 of the 584 Contempt of Courts Act, the second appellant was held guilty of contempt of the Sub Divisional Magistrate on the following reasoning Shri Mohammad Munawar opposite party No. 5 forwarded application given by the opposite parties Nos ' 2 and 3 together with introductory letter to the Sub Divisional Magistrate,Jalaun. We do not think that he had any intention to influence the Sub Divisional Magistrate with respect to his action in the case under section 145, Criminal Procedure Code. But intention is not 'of importance so far as the question of commission of contempt is concerned. He certainly acted without due circumspection and thought. It must have been clear to him that the application contained expression which affected the due considerations of the points in dispute in the proceeding under section 145, Criminal Procedure Code. He says in his affidavit and we can accept it that he sent this application to the Sub Divisional Magistrate just for taking action for the protection of opposite parties No. 2 and No. 3 and their crop about which an allegation was made that some action was to be taken by the other party the night following. He should in the circumstances either pass an order for the police himself which he could have very well done, or he could have just conveyed a gist of the complaint necessitating protection of life and property immediately. His conduct in transmitting the allegations made by the opposite parties No. 2 and 3 to the Sub Divisional Magistrate, Jalaun, in whose court the case under section 145, Criminal Procedure Code, was pending, did amount to the commission of contempt of that court." As regards the first appellant, the facts are that on 22nd March an application was received by post in the office of the District Magistrate signed by Shriram containing allegations against the trying Magistrate. On 25th March, 1950, this application was sent by the appellant for report to the Sub Divisional Magistrate with the following endorsement 585 section D.C. Please look into these allegations and let me have a report. " On 4th April, 1950, the Sub Divisional Magistrate submitted a report and the first appellant having been satisfied that the allegations were baseless passed the following order: " I do not see any reason to withdraw the case from your file." On the application of Phundi Singh mentioned above made before the High Court of Allahabad under section 3 of the Contempt of Courts Act this appellant along with others was also held guilty of contempt of the Sub Divisional Magistrate 's Court, on the following reasoning : "Similarly transmission of the application sent by Shriram on the 25th March to the Sub Divisional Magistrate, Jalaun, amounted to commission of contempt of court by opposite party No. 6. The mere fact that he had to take action in view of the allegations against the magistrate in that application would not affect this question. The application contained, as already stated, expressions showing that Phundi Singh was a history sheeter and that the case under section 145, Criminal Procedure Code, was fictitious and was instituted at the instance of Pratap Singh. He should not have transmitted the entire application. He could have necessary extracts which related to the allegations against the magistrate sent to the ' court concerned in the circumstances when the applicants introduced matter irrelevant for transfer application. It may also be mentioned here that the application could be treated as a transfer application though no such request was made in that application. The application was neither properly presented nor was it accompanied by an affidavit nor was it stamped. The applicant wanted some action for the protection of his crop from bad characters." Having found both the appellants guilty of contempt of court of the Sub Divisional Magistrate, Jalaun, the High Court took no action against them because they happened to commit contempt of court rather due to their carelessness Find lack of vigilance 586 than with any deliberate intention to commit it. It was observed that officers who have to transmit communications to courts of justice should be vigilant and careful to see that nothing is transmitted which can have any effect, even remotely on, the merits of a case. In our judgment, the proceedings for contempt of court against the two appellants on the facts stated are misconceived and have to be quashed. Both the appellants were superior officers of the Sub Divisional Magistrate at the time when they sent the applications of Kedarnath and Matadin for report. They were under a duty to supervise his work. It is difficult to see how by transmitting the applications received by them to him, and asking him for his views they were in any way interfering with the course of justice and were committing contempt of his court. Their action cannot be characterized as having a tendency to interfere with the course of justice. The applications were transmitted to the Sub Divisional Magistrate in the usual and normal course of the official practice and we 'cannot subscribe to the view of the High Court that only extracts of these applications should have been sent to him for his views and not the applications as such as they contained material which had a tendency to interfere with the course of justice. The second appellant, when he was officiating as District Magistrate, received the application of Kedarnath and Matadin with a letter of recommendation from the Secretary of the Congress Committee. This application was in the nature of a counter complaint, and the appellant acted properly in sending it to the magistrate who was seised of the original application. He was under no duty to censor it and to out it into pieces and then forward the relevant parts only to the magistrate. The recommendatory letter was an annexure to the application and it had to go with it. The conduct of the Secretary of the Congress Committee in writing a recommendatory letter about the facts of the case to the District 587 Magistrate was undoubtedly a communication for the purpose of influencing his decision and was rightly reprobated by the High Court. Such 9, course is calculated, if tolerated, to divert the course of justice and ought more frequently than it is, to be treated as what it really is ' namely, a high contempt of court. The Congress Secretary has been rightly held guilty of contempt and punished. He has not come to this Court and we are no longer concerned with him. But we are unable to find how the conduct of the appellant in sending the application which, as we have already stated, was in the nature of counter charge to the Sub Divisional Magistrate who was seised of the original complaint in any way amounted to contempt of court. There are three different sorts of contempts known to law in such matters. One kind of contempt is scandalizing the court itself. There may likewise be a contempt of the court in abusing parties who are concerned in causes in that court. There may also be a contempt of court in prejudicing mankind against persons before the cause is heard. The act of the appellant could not fall in either of these three categories. So far as the first appellant is concerned, under the provisions of section 528 of the Code of Criminal Procedure, he had authority to withdraw the case under section 145 of the Code pending in the court of the Sub Divisional Magistrate. On the application of 22nd March made by Kedarnath and Matadin containing allegations against the Sub Divisional Magistrate he was entitled to use his powers under that section if the allegations contained therein were substantiated. It is usual to send such applications to the court concerned for its remarks and that is precisely what he did. and as soon as the remarks were received and he was satisfied that the allegations were baseless, he declined to withdraw the case. We have not been able to see how such an action on the part of the District Magistrate, done in the normal and usual course of the discharge of his duties as such magistrate, could be held to interfere with the 76 588 course of administration of justice or to create pre re judice of any kind against the complainant in the proceedings under section 145 of the Code of Criminal Procedure. There is nothing in section 528 of the Criminal Procedure Code which disables a magistrate from taking action unless he is set in motion by the petition of one of the parties and nothing in the Code prevents any person from bringing facts to the notice of the District Magistrate which might suggest to that magistrate that it was advisable to see whether the magistrate should remain in charge of a particular case. In our judgment, therefore, the High Court was in error in thinking that the two appellants acted without due circumspection and thought and were guilty of contempt of the court of the Sub Divisional Magistrate. We are further of the opinion that it was not possible to hold on those facts that any prejudice &rose in the case by these two applications being sent by the appellants to the Sub Divisional Magistrate or that any action was necessary for the protection of the tribunal which was engaged in hearing the case under section 145, Criminal Procedure Code. As observed by Rankin C.J. in Anantalal Singha vs Alfred Henry Watson (1), the jurisdiction in contempt is not to be invoked unless there is real prejudice which can be regarded as a, substantial interference with the due course of justice and that the purpose of the court 's action is a practical purpose and it is reasonably clear on the authorities that the court will not exercise its juris diction upon a mere question of propriety. The result is that we allow the appeal, set aside the judgment of the High Court against the two appellants and acquit them of the charge under section 3 of the Contempt of Courts Act. Appeal allowed. Agent for the appellant : section Subramanian.

The jurisdiction in contempt of court is not to be invoke a unless there is real prejudice which can be regarded as a substantial interference with the due course of justice. The purport of the court 's action is a practical purpose and the Court will not exercise its jurisdiction upon a mere question of propriety. During the pendency of proceedings against A and B under section 145, Criminal Procedure Code, in the court of a Sub Divisional Magistrate, A and B made an application to the District Magistrate alleging that the proceedings were not bona fide and 582 containing statements in the nature of a countercharge. The 2nd appellant who was then officiating as the District Magistrate sent this application to the Sub Divisional Magistrate for report and on receiving a report from him that A and B should be asked to file a formal complaint before him, advised them to do so. A brother of A sent a similar petition to the District Magistrate containing also allegations against the trying Magistrate. The 1st appellant, who was the District Magistrate, forwarded them to the Sub Divisional Magistrate for report, and on receiving his report passed an order that he saw no reason to withdraw the file from the Sub Divisional Magistrate. The High Court of Allahabad held that as the applications contained allegations which might interfere with the course of the trial of the proceedings under section 145, in transmitting the applications the appellants had acted without due circumspection and thought though they had no intention to influence the Sub Divisional Magistrate and the appellants were therefore guilty of contempt of court: Held, (i) that in transmitting the applications received by them to the Sub Divisional Magistrate and calling for a report the appellants were not in any way interfering with the course of justice but were only doing their duty as superior officers; (ii) it was not possible to hold that any prejudice had been caused by the two applications being sent by the appellants to the Sub,Divisional Magistrate or that any action was necessary to protect the Sub Divisional Magistrate who was hearing the case and the appellants were not guilty of any contempt of court. Anantalal Singha vs Alfred Henry Watson ([1931] I.L.R. referred to.

Appeal No. 185 of 1956. Appeal by special leave from the judgment and decree dated November 25, 1954, of the Bombay High Court in Second Appeal No. 1003 of 1952. H. R. Gokhale, J. B. Dadachanji, section N. Andley, Rameshwar Nath and P. L. Vohra, for the appellants. C. B. Agarwala and A. G. Ratnaparkhi, for the respondent No. 1. April 19. The Judgment of the Court was delivered by SINHA, C. J. The only question for determination in this appeal is whether the defendants appellants are 'protected tenants ' within the meaning of the Bombay Tenancy Act (Bombay Act XXIX of 1939) (which hereinafter will be referred to, for the sake of brevity, as the Act of 1939), whose rights as such were not affected by the repeal of that Act by the Bombay Tenancy and Agricultural Lands Act (Bombay Act LXVII of 1948) which hereinafter will be referred to as the Act of 1948). The Courts below have decreed the plaintiff 's suit for possession of the lands in dispute, holding that the defendants were not entitled to the protection claimed by them as 'protected tenants '. This appeal is by special leave granted by this Court on April 4, 1965. The facts of this case are not in dispute. Shortly stated, they are as follows. By virtue of a lease dated October 30, 1939, the defendants obtained a lease of the disputed lands from the plaintiff for a period of 10 years, expiring on October 30, 1949. The lands in 61 dispute have been found to lie within two miles of the limits of Poona Municipality. The landlord gave notice on October 22, 1948, terminating the tenancy as from October 30, 1949. As the defendants did not vacate the land, in terms of the notice aforesaid, the plaintiff instituted the suit for ejectment in the Court of the Civil Judge, Junior Division, at Poona in Civil Suit No. 86 of 1950. The Act of 1939 became law on March 27, 1940, but the Act was applied to Poona area with effect from April 11, 1946. Under section 3 of the Act, a tenant shall be deemed to be a ' protected tenant ' in respect of any land if he has hold such land continuously for a period of not less than six years immediately preceding either the first day of January, 1938, or the first day of January, 1945, (added by the Amending Act of 1946) and has cultivated such land personally during the aforesaid period. It is not disputed that the defen dants appellants became entitled to the status of 'protected tenants ' as a result of the operation of the Act, as amended by the Bombay Tenancy (Amendment) Act, 1946 (Bombay Act XXVI of 1946), and under section 3A(1) the defendants were deemed to be 'protected tenants ' under the Act and their rights as such were recorded in the Record of Rights. Sections 3 and 3A(1), aforesaid, are set out below: "3. A tenant shall be deemed to be a protected tenant in respect of any land if (a) he has held such land continuously for a period of not less than six years immediately preceding either (i) the first day of January 1938 or (ii) the first day of January 1945 and (b) has cultivated such land personally during the aforesaid period. 3A(1) Every tenant shall, on the expiry of one year from the date of the coming into force of the Bombay Tenancy Amendment Act of 1946, be deemed to be a protected tenant for the purposes of this Act and his rights as such protected tenant shall be recorded in the Record of Rights, unless his landlord has within the said period made an application to 62 the Mamlatdar within whose jurisdiction the land is situated for a declaration that the tenant is not a protected tenant". Under section 3A(1) aforesaid, it was open to the landlord, within one year of the date of the commencement of the Amending Act of 1946, to make an application to the Mamlatdar for a declaration that the tenant was not a 'protected tenant '. No such proceeding appears to have been taken. As a result of the expiration of one year from November 8, 1946the date of the coming into operation of the Amending Act of 1946 the defendants were deemed to be 'protected tenants ' and it is not disputed that they were recorded as such. Section 4 of the Act, with which we are not concerned in the present case, made further provisions for recovery of possession by tenants who had been evicted from their holdings in circumstances set out in that section. The Act, therefore, in its terms, was intended for the protection of tenants in certain areas in the Province of Bombay (as it then was). If nothing had happened later, the defendants would have had the status of 'protected tenants ' and could not have been evicted from their holdings, except in accordance with the provisions of the Tenancy Law. But the Act of 1939 was replaced by the Act of 1948. The question that arises now for determination is whether the Act of 1948 wiped out the defendant 's status as 'protected tenants '. For determining this question, we have naturally to examine the relevant provisions of the later Act. The Act of 1948, by section 2 cl. (14) prior to its amendment by Bombay Act XIII of 1956, provides that " protected tenant ' means a person who is recognised to be a protected tenant under section 31". Section 31 runs as follows: "For the purposes of this Act, a person shall be recognised to be a protected tenant if such person has been deemed to be a protected tenant under section 3, 3A or 4 of the Bombay Tenancy Act, 1939. " The force and effect of section 31 will have to be discussed later while dealing with the arguments raised 63 on behalf of the landlord respondent. The next relevant provisions of the Act of 1948 are those of section 88(1)(c) which reads: "Nothing in the foregoing provisions of this Act shall apply: . . . . . . . . . . . . . . . (c) to any area within the limits of Greater Bombay and within the limits of the municipal boroughs of Poona City and Suburban, Ahmedabad, Sholapur, Surat and Hubli and within a distance of two miles of the limits of such boroughs; or. . As already observed, the lands in dispute in the present controversy have been found to be situate within two miles of the limits of the Poona Municipal Borough, which, for the purpose of this case, has been equated to 'Borough of Poona City and Suburban '. It has been contended on behalf of the respondent that under the later Act the disputed lands are outside the purview of the Act and that, therefore, the defendants appellants are not entitled to claim the status of 'protected tenants '. The appellants have answered this contention by reference to the provisions of section 89, which may now be set out (in so far as they are necessary for the purpose of this case): "89(1) The enactment specified in the Schedule is hereby repealed to the extent mentioned in the fourth column thereof (2) But nothing in this Act or any repeal effected thereby . . . . . . . `. (b) shall, save as expressly provided in this Act, affect or be deemed to affect, (i) any right, title, interest, obligation or liability already acquired, accrued or incurred before the commencement of this Act, or (ii) any legal proceeding or remedy in respect of any such right, title, interest, obligation, or liability or anything done or suffered before the commencement of this Act, and any such proceeding shall be continued and disposed of, as if this Act was not passed . ". 64 It has been contended on behalf of the appellants that the repealing section 89, read with the Schedule, makes it clear that the whole of sections 3, 3A and 4 of the Act of 1939 have been saved, subject to certain modifications, which are not relevant to the present purpose; and that sub section 2(b) of section 89 has in terms, saved the appellants ' rights as 'protected tenants ' because those rights had already accrued to them under the Act of 1939. But this contention is countered by the learned counsel for the plaintiff respondent on three grounds, namely, (1) that section 88 expressly provides that sections 1 to 87 of the later Act shall not apply to lands situate in the Municipal Borough of Poona City and Suburban and within a distance of two miles of the limits of such borough; (2) that what has been saved by cl. (b) of sub section (2) of section 89 is not every right but only such rights as had been actually exercised and recognised; and (3) that the terms of the saving clause, as contained section 89(2)(b) were not identical with section 7 of the Bombay General Clauses Act, inasmuch as cl. (b) aforesaid only speaks of such proceedings being continued and disposed of, without reference to the institution of such proceedings. Shortly put, the arguments on behalf of the appellants is that the taking away of the status of a protected tenant ' from certain lands, as specified in section 88, is only prospective and not retrospective, whereas the argument on behalf of the respondent is that the repeal was with retrospective effect and only so much was saved as would come directly within the terms of el. (b) of section 89(2), and that the right claimed by the appellants was in express terms taken away by section 88. The argument based on the second ground may be disposed of at the outset in order to clear the ground for a further consideration of the effect of sections 88 and 89, on which the whole case depends. The learned counsel for the plaintiff respondent placed strong reliance upon the following observations of the Lord Chancellor in the case of Abbot vs The Minister for Lands (1): "They think that the mere right (assuming it to (1) ,431. 65 be properly so called)existing in the members of the community or any class of them to take advantage of an enactment, without any act done by an individual towards availing himself of that right, cannot properly be deemed a "right accrued" within the meaning of the enactment." The contention is that in order that the defendants appellants could claim the status of 'protected tenants ' as a right accrued under the Act of 1939, they should have taken certain steps to enforce that right and got the relevant authorities to pronounce upon those rights, and as no such steps had admittedly been taken by the appellants, they could not claim that they had a 'right accrued ' to them as claimed. In our opinion, there is no substance in this contention. The observations, quoted above, made by the Lord Chancellor, with all respect, are entirely correct, but have been made in the context of the statute under which the controversy had arisen. In that case, the appellant had obtained a grant in fee simple of certain lands under the Crown Lands Alienation Act, 1861. By virtue of the original grant, he would have been entitled to claim settlement of additional areas ' if he satisfied certain conditions laid down in the relevant provisions of the statute. The original settle had the right to claim the additional settlements, if he so desired, on fulfillment of those conditions. He had those rights to acquire the additional lands under the provisions of the Crown Lands Alienation Act,, 1861, but the Crown Lands Act of 1884, repealed the previous Act, subject to a saving provision to the effect that all rights accrued by virtue of the repealed, enactment shall, subject to any express provisions of the repealing Act in relation thereto, remain unaffected by such repeal. The appellants ' contention that under the saving clause of the repealed enactment he had the right to make additional conditional purchases and that was a 'right accrued ' within the meaning of the saving clause contained in the repealing Act of 1884, was negatived by the Privy Council. It is, thus;, clear that the context in which the observations relied upon by the respondent, as quoted above, were made is entirely different 9 66 from the context of the present controversy. That decision is only authority for the proposition that 'the mere right, existing at the date of a repealing statute, to take advantage of provisions of the statute repealed is not a 'right accrued ' within the meaning of the usual saving clause '. In that ruling, their Lordships of the Privy Council assumed that the contingent right of the original grantee was a right but it was not a right accrued ' within the meaning of the repealed statute. It was held not to have accrued because the option given to the original grantee to make additional purchases had not been exercised before the repeal. In other words, the right which was sought to be exercised was not in existence at the date of the repealing Act, which had restricted those rights. In the instant case, the right of a 'protected tenant ' had accrued to the appellants while the Act of 1939 was still in force, without any act on their part being necessary. That right had been recognised by the public authorities by making the relevant entries in the Record of Rights, as aforesaid. On the other hand, as already indicated, section 3A(1) of the 'Act of 1939 had given the right to the landlord respondent to take proceedings to have the necessary declaration made by the mamlatdar that the tenant had not acquired the status of a 'protected tenant '. He did not proceed in that behalf. Hence, it is clear that so far as the appellants were concerned, their status as 'protected tenants ' had been recognised by the public authorities under the Act of 1939, and they bad to do nothing more to bring their case within the expression 'right accrued ', in el. (b) of section 89(2) of the Act of 1948. It having been held that the second ground of attack against the claim made by the appellants is not well founded in law, it now remains to consider whether the first ground, namely, that there is an express provision in section 88, within the meaning of section 89(2)(b), taking away the appellants ' right, is supported by the terms of sections and 89. In this connection, it was pointed out on behalf of the respondent that section 88(1) in terms provides that sections 1 to 87 of 67 the Act of 1948 shall not apply to lands of the situation of the disputed lands; and section 31 has been further pressed in laid of this argument. Section 31 has already "been quoted, and it begins with the words "For the purposes of this Act". The provisions of the Act of 1948 relating to the rights and liabilities of a protected tenant ' are not the same as those under the Act of 1939. Hence, though the provisions of sections 3, 3 A and 4 of the earlier Act of 1939 have been adopt. ed by the later Act, it has been so done in the context of the later Act, granting greater facilities and larger rights to what are described as 'Protected tenants '. In other words section 31 has been enacted not to do away with the rights contained in sections 3, 3 A and 4 of the earlier statute, but with a view to apply that nomenclature to larger rights conferred 'under the Act of 1948. The provisions of section 88 are entirely prospective. They apply to lands of the description contained in cls. (a) to (d) of a. 88(1) from the date on which the Act came into operation, that is to say, from December 28, 1948. They are not intended in any sense to be of a confiscatory character. They do not show an intention to take away what had already accrued to tenants acquiring the status of 'protected tenants '. On the other hand, section 89(2)(b), quoted above, clearly shows an intention to conserve such rights as had, been acquired or had accrued before the commencement of the repealing Act. But it has further been contended on behalf of the respondent, in ground 3 of the attack, that sub cl. (ii) of cl. (b) of section 89(2) would indicate that the legislature did not intend completely to re enact the provisions of section 7 of the Bombay General Clauses Act. This argument is based on the absence of the word instituted ' before the words 'continued and disposed of '. In our opinion there are several answers to this contention. In the first place, sub cl. (i) is independent of sub el. (ii) of ol. (b) of section 89(2). Therefore, sub el. (ii), which has reference to pending litigation, cannot cut down the legal significance and ambit of the words used in sub cl. Sub cl. (ii) may have reference to the forum of the proceedings, whether the Civil Court or the Revenue Court shall have seizin of 68 proceedings taken under, the repealed Act. ;We have already held that the expression 'right accrued ' in sub el. (i) does not exclude the rights of 'protected tenants"claimed by the appellants. It is well settled that where there is a right recognised by law, there is a remedy,; and, therefore, in ' the absence of any special provisions indicating the particular forum for enforcing a particular right, the general law of the land will naturally take its course. In this connection, it is relevant to refer to the observations of the High Court that "even if it were to be assumed that the right as a 'protected tenant ' remained vested in the defendants even after the enactment of section 88(1), that right, in its enforcement;against the plaintiff, must be regarded as illusory". In our opinion, those observations are not well founded. Courts will be 'very slow to assume a right and then to regard it as illusory, because no particular forum has been indicated. Lastly, the legal effect of the provisions of sub el. (ii) aforesaid is only this that any legal proceeding! in ' respect of the, right claimed by, the defendants shall be continued and disposed of as if the Act of 1948 had not been passed. Applying those words to the present litigation the inference is clear that the controversy has to be resolved with reference to the provisions of the repealed statute. That being so, in Our Opinion, the intention of the legislature was that the litigation we are now dealing with should be disposed of in terms of the repealed statute of 1939. It has not been disputed before us that if that. is done, there is only one answer to this suit, namely, that it must be dismissed with costs. Accordingly, we allow the appeal, set aside the judgments below and dismiss the suit with costs throughout, to the contesting defendants appellants.

The appellants had acquired the rights of protected tenants under section 3A(1) of the Bombay Tenancy Act, 1939, as amended by the Bombay Tenancy (Amendment) Act, 1946, and their rights as protected tenants were recorded in the Record of Rights. That Act was repealed by the Bombay Tenancy and Agricultural Lands Act, 1948, which by section 31 recognised the rights of a protected tenant acquired under the Act of 1939 for its own purposes, by section 88(1)(c) provided, that nothing in the foregoing provisions of the Act should apply to any area within the limits of the Municipal borough of Poona City and Suburban as also some other boroughs and within a distance of two miles of the limits of such boroughs, and by section 89(2) that "nothing in this Act or any repeal effected thereby . (b) shall, save as expressly provided in this Act, affect or be deemed to affect (i) any right, title, interest, obligation or liability already acquired, accrued or incurred before the commencement of this Act, or . . . . . . . . . or . . . . . . . . . (ii) any legal proceeding or remedy in respect of any such right, title, interest, obligation, or liability or anything done or suffered before the commencement of this Act, and any such proceeding shall be continued and disposed of, as if this Act was not passed The lands in dispute were situated within two miles of the limits of the Poona Municipal Borough, i.e. Poona City and Suburban, and the question was whether the rights of the appellants as protected tenants therein were. I affected by the repeal. Held, that the provisions of section 88 of the Bombay Tenancy and Agricultural Lands Act, 1948, are entirely prospective and apply to such lands as are described in cls. (a) to (d) of section 88(1) from 60 the date on which the Act came into operation i.e. December 28, 1948, and are not of a confiscatory nature so as to take away from the tenant the status of a protected tenant already accrued to him. Section 89(2)(b) of the Act clearly intends to conserve such rights as were acquired or accrued before its commencement and that any legal proceeding in respect of such rights was to be disposed of in terms of the Act of 1939. Abbot vs The Minister for Lands, , distin guished.

n No. 143 of 1961. Petition under article 32 of the Constitution of India for the enforcement of Fundamental rights. section Swaminathan and R. Gopalakrishnan, for the petitioner. K. N. Rajagopala Sastri and P. D. Menon, for the respondents. 595 1962. January 16. The Judgment of the Court was delivered by KAPUR,J. This is a petition by the assessee under article 32 of the Constitution challenging the constitutionality of the second proviso to section 10(2) (vi b) of Income tax Act introduced by The Taxation Laws (Amendment) Act (28 of 1960). The relevant section with the proviso is as follows: section 10(1) "The tax shall be payable by an assessee under the head "Profits and gains of business, profession or vocation" in respect of the profits or gains of any business, profession or vocation carried on by him. (2) Such profits or gains shall be computed after making the following allowances, namely: . . . . . . . . . . . . . . . . . . . (vi b) in respect of machinery or plant being new, which has been installed after the 31st day of March, 1954, and which is wholly used for the purposes of the business carried on by the assessee, a sum by way of development rebate in respect of the year of installation equivalent to twenty five per cent of the actual cost of such machinery or plant to the assessee : Provided that no allowance under this clause shall be made unless the particulars prescribed for the purpose of clause (vi) have been furnished by the assessee in respect of such machinery or plant; Provided further that no allowance under this clause shall be made in respect of any machinery or plant which consist of office appliances or road transport vehicles. " The petitioner is a limited company with its registered office at Madurai in the State of Madras 596 which owns a fleet of buses and lorries and carries on the business of transport In respect of assessment year 1960 61 it claimed a development rebate on all its plants and machinery including business. The Income tax Officer disallowed the claim of rebate on transport vehicles under the proviso above quoted and computed the tax payable without such rebate. It was contended on behalf of the petitioner that the proviso offends article 14 in that it discriminates between machinery which is office appliance or road transport vehicles and other kind of machinery. It is difficult to accept such a contention because there is nothing in the Constitution which prevents the legislature from choosing the object of taxation from amongst various classes of machinery for the purpose of giving development rebate. The Constitution does not prohibit any such classification which has been made in the pressnt case. The petition is wholly without merit and is therefore dismissed and the rule is discharged. The petitioner will pay the costs of the respondent. Petition dismissed.

The assessee company owned a fleet of buses and carried on the business of transport. The income tax officer disallowed development rebate on the transport vehicles owned by the company as provided by the second proviso to section 10(2) (vi b) of the Income tax Act. The company challenged the section on the ground that the said proviso offends article 14 in that it discriminates between machinery which is office appliances or road transport vehicles and other kinds of machinery. ^ Held, that there is nothing in the Constitution which prevents the Legislature from choosing the objects of taxation from amongst various classes of machinery for purpose of giving development rebate.

Civil Appeal No. 87 of 1959. Appeal from the judgment and decree dated April 6, 1955, of the former Andhra High Court in A.S.O. No. 134/50. T. V. R. Tatachari, for the appellants. Bhimasankaram, K. R. Choudhuri and T. M. Sen, for the respondent. December 21. The Judgment of the Court was delivered by: RAGHUBAR DAYAL, J. This is an appeal on a certificate granted by the High Court of Andhra Pradesh, against the judgment and order of the High Court reversing the judgment and order of the District Judge, Vizagapatam, holding that the place of worship in suit was not a temple as defined in the Madras Hindu Religious Endowments Act, 1926 (Madras Act II of 1927), hereinafter called the Act. On March 28, 1947, the Board of Commissioners for Hindu Religious & Charitable Endowments, Madras, held the institution in suit to be a temple as defined in the Act. The appellants, thereafter filed a petition under section 84(2) of the Act, in the Court of the District Judge, Vizagapatam, and prayed for the setting aside of the order of the Board. They alleged that the institution, known as the Poohari Fakir Sadavarthy, at Bondilipuram, Chicacole, a ongstanding institution, was started by one Malukdas 278 Bavajee, some time during the reign of the Moghul Emperor, Aurangazeb. The Emperor, in recognition of the Bavajee 's piety and devotion to God, made certain grants to him with the object and purpose of enabling him to maintain himself and carry on the distribution of Sadavarthy to Fakirs and Sadhus and to pray to God for the prosperity of the Empire and Emperor, according to what was stated in the well known historical works like Bhakthamala by Maharaja Raghunandha Singh Deo of Rewa. The institution flourished and continues up to this day. The original plaintiff No. 2, Rajaram Das Bavajee, was the ninth in succession from the founder Malukdas Bavajee. He died during the pendency of the proceedings and is now represented by appellant No. 2, Mahant Gangaram Das Bavajee. Sithaldas Bavajee, the sixth head of the institution, who lived in the first half of the Nineteenth Century built a temple and installed therein certain idols for his private worship. The shrine was an adjunct of the institution Poohari Fakir Sadavarthy. It is alleged to be a private temple known as Jagannadhaswami temple, Balaga, and is meant for the worship of the Mahant and his disciples, one of whom conducts the daily worship. The income from the various properties granted to Malukdas Bavajee or his successors had been regularly utilised for the maintenance of the head of the institution and for distributing charities to the sadhus and pilgrims passing through Balaga. A part of the income was, however spent on the expenses of the worship in the temple and the incidental expenses connected with it. The respondent Board denied that Jagannadhaswami temple was a private place of worship, that the public had no access to it without the permission of the Bavajee and alleged that the temple possessed all the features of a place of public 279 religious worship and was dedicated to or for the benefit of or used as of right by the Hindu community as a place of religious worship. The appellants examined five witnesses, including plaintiff No. 2, in support of their case. The respondent examined one witness. The plaintiffs also filed a number of documents. The respondent filed a few documents which included the Board 's order dated March 28, 1947, and its enclosure. The learned District Judge concluded, from the evidence, that Jagannadhaswami temple was not a temple as defined in the Act, it being a private temple existing for the benefit of the appellants only. He therefore set aside the impugned order of the Board. On appeal, the High Court came to a different conclusion and allowed the appeal. It mainly relied on the entries in the Inam registers with respect to the institution and on the following facts which it considered to be established : (i) the temple is a very old temple constructed in or about the year 1750; (ii) the temple has the structure and polity of a public temple; (iii) there are utsava vigrahams and vahanams; (iv) it has a big compound wall with the gate opening into the Chinna Bazaar Road; (v) regular worship is performed every day at the scheduled time; (vi) there is an archaka who performs worship; (vii) a large number of pilgrims attend every day and partake in the food given after naivedyam to the God; 280 (viii) there are utsavams and the rathotsavam which is particularly conducted on large scale and is attended by members of the public. The High Court relied on the statement of the solitary witness examined for the Board and rejected the statements of the witnesses examined for the appellants. The sole question for determination in this appeal is whether this institution is a 'temple ' as defined in the Act. Clause (12) of section 9 of the Act reads: " 'Temple ' means a place, by whatever designation known, used as a place of public religious worship and dedicated to, or for the benefit of, or used as of right by, the Hindu community, or any section thereof, as a place of religious worship. " The institution in suit will be a temple if two conditions are satisfied. One is that is a place of public religious worship and the other is that it is dedicated to or is for the benefit of, or is used as of right by, the Hindu community, or any section thereof, as a place of religious worship. We are of opinion that the oral and documentary evidence fully establish the appellants ' case that it is not a temple as defined in the Act. The documents on record and bearing dates from 1698 to 1803 A. D. mention the grants to be for the purposes of the Bavajee, i.e., the head of the institution. The first document, Exhibit P 1, (is of the Hizri year 1117, corresponding to 1698 A.D., and purports to be executed by Ibrahim Khan, Bahadur, a humble servant of Badshah Alamgir Ghazi. , i.e., Emperor Aurangazeb. This order says: "The village of Cheedivalasa, Boonamali Pargana Haveli (town) towards Kaling of the 281 said Sirkar, has been fixed and continued as a complete inam in favour of Poohari (Poojari) Fakir Sadabarty in accordance with the Sanads of the previous rulers. Meanwhile, in view of the claims of the said person it has been confirmed as per endorsement in accordance with momooli (usage) and mustamir (continuing, lasting long). It is necessary that the said village be placed in the enjoyment of the said person so that, utilising the incomes thereof for his own maintenance, he may engage himself in praying for the stability of the State till eternity. " The purpose of the other grants is stated in practically similar terms aud it is necessary to quote them. None of the grants of land or other property on record bears a date subsequent to that of the year 1803 A.D. The documents, Exhibits P 47, P 48 and P 49 are orders of the Collectors and refer to the villages of Cheedivalasa and Thallavalasa, and the last two state that the income of these two villages was given for sadavarty (feeding) for the respective year to Phalari (Phulhari) Bavaji. There is no mention in any of these two documents that any grant was being made for the purposes of the temple or for the purposes of the Bavaji as well as for those of a temple. The only reference to the construction of the temple is in Exhibit P 52, an extract from the Register of Inams dated May 22, 1865, with respect to village Vanzangi. The name of the village, however, does not appear in the document itself. It is stated in this document: "About century ago, the trustees built a temple of Jagannadhaswamy. " According to this note, the temple may be said to have been built in about 1760 A.D. The documents of the period from 1761 to 1803 A.D. Exhibits P 31 282 to P 49, do not record that the grants under them were for the expenses of the temple as well. The grants simply mention them to be for the expenses of Fakirs, in the name of Poohari Fakir Sadavarthy, and not for the temple. The non reference to the temple in the various documents is consistent with the temple being for the private worship of the head of the Sadavarti Institution and being an adjunct to that institution, as in that case there was to be no grant to the temple and the grant had to be to the Sadavarti institution or to its head. It is also a matter for surprise that no independent grant to this temple was made subsequent to its coming into existence. Some one religiously and charitably disposed could have thought of endowing some property to this public temple erected by the Head of a well known institution in that part of the country, where, it has been held judicially, there is a presumption of a temple being a public temple. We may make it clear that among the documents referred to, we are not at the moment including entries in the Inam registers. It follows from an examination of the various documents of the period between 1608 and 1803 A.D., that the various endowments were for the Fakir or Bavajee who ran the Sadavarti institution and that none of the grants was for the temple or even for the Sadavarti institution itself, it being always in the name of the Bavajee in charge of that institution. Before discussing the entries in the inam registers which carry great weight, we may first refer to the Rules in pursuance of which the entries in the Inam registers were made, after due investigation. The various extracts from the Inam registers which have been filed show that the proposals for the grant were confirmed under rule 3, clause (1), tax free. This makes it of importance to consider the rule 283 thus referred to. It is one of the rules for the adjudication and settlement of the inam lands of the Madras Presidency and is quoted at page 219 in the case reported as Arunachellam Chetty vs Venkatachalapathi Guruswamigal (1) "If the inam was given for religious or charitable objects, such as for the support of temples, mosques, colleges, choultries, and other public buildings or institutions, or for services therein, whether held in the names of the institutions or of the persons rendering the services; it will be continued to the present holders and their successors, and will not be subject to further interference, so long as the buildings or institutions are maintained in an efficient state, and the services continue to be performed according to the conditions of the grant. " It was also said at page 217: "But the Inam Register for the year 1864 has been produced, and to it their Lordships attach importance. It is true that the making of this Register was for the ultimate purpose of determining whether or not the lands were tax free. But it must not be forgotten that the preparation of this Register was a great act of state, and its preparation and contents were the subject of much consideration under elaborately detailed reports and minutes. It is to be remembered that the Inam Commissioners through their officials made inquiry on the spot, heard evidence and examined documents, and with regard to each individual property the Government was put in possession not only of the conclusion come to as to whether the land was tax free, but of a statement of the history and tenure of the property itself. While their Lordships do not doubt that such a report would not displace actual 284 and authentic evidence in individual cases; yet the Board, when such is not available, cannot fail to attach the utmost importance, as part of the history of the property, to the information set forth in the Inam Register. " Exhibit P 50 is the extract from the Inam Register No. 48 relating to village Tallavalasa in the Taluk of Chicacole in the district of Ganjam. The note of the Deputy Collector, Inam Commissioner, records inter alia the following particulars: (1) The village was granted originally by the Nawab Mafuz Khan in Hiziri 1155 corresponding with A.D. 1739 to one Inamdar Bairagi; as the original sanad is not forthcoming it is impossible to mention here without entering into details, the object of the grant and the tenure of the village. This mokhasa jahagiri is in possession of the person in column (II) who is known by the name of Palahara Mahant Bartudoss Bavaji, 'a Bairagi '. (2) This Bartudoss Bavaji pleaded that this village and three other villages were granted in the district by the former Rulers for Sadavarti and for certain other Divine Service, and that the proceeds of them were appropriated to the expenses attendant on the temple of Sri Jagannadhaswami to some extent and to distributing Sadavarti or supplying victuals, fire wood, etc., or dressed food to Bairagis and others resorting to Rameswaram from Benaras and vice versa. (3) This Bartudoss Bavaji produced a sanad of Sri Seetaram Ranzi Maharaja, the former zamindar of Vizianagaram in Vizagapatam district, granted to one Gopaladass Palahari Bavaji, dated Subhakrutu year, corresponding with A.D. 1782. This Sanad 285 showed that the said Gopaladass was then a manager of the branch of charity and that this village was granted free from any tax in lieu of the income in the villages of Balaza, Petranivalasa and Serumohannadpuram which were granted originally by the authorities for the support of the charity and which were resumed and incorporated with circar lands. The sanad explicitly stated that the proceeds of the village were to be appropriated for Sadavarti. (4) On the whole it appears that this mokhasa was granted for 'Sadavarti ' and for the support of the temple of Sri Jagannadhaswami in Balaga. There is a Bairagi Mattam in Balaga and a temple of Sri Jagannadhaswami. This is therefore a charitable grant. To keep up the object of grant, I think the village may be confirmed on its present tenure. (5) Column 8, meant for noting the description of the inam, mentioned: 'Granted for the support for the Sadavarti Bairagi mattam in Balaga and of the temple of Sri Jagannadhaswami in the same village now efficiently kept up. ' (6) In column 10, under the heading 'hereditary, unconditional for life only or for two or yihre lives ' is mentioned 'hereditary '. (7) Column 11 meant for recording the name of the grantor and the year of the grant, mentions, under it, Mafusu Khan Nawab, dated Hijiri 1155. (8) In column 13, Mandasa Palahari Bairagi is mentioned as the original grantee. (9) Under column 18, referring to relationship to original grantee or subsequent registered holders, is written 'Sadavarti 286 Bairagi mattam and the temple of Sri Jagannadhaswami in Balaga Trustee Palahara Mahant Barta Dasu Bavaji '. It is clear from the fact that the grant was considered 'a charitable grant ' that the grant was not taken to be for the purposes of the temple, but was taken to be a grant for the purposes Sadavarti. This is also clear from the Statement of Bartudoss Bavaji that it is only a part of the proceeds which is spent on the temple and not a major portion of the proceeds, as his statement is to the effect that the proceeds are appropriated to the expenses attendant on the temple 'to some extent '. There is no suggestion that the temple was in existence in 1739 A. D. when the grant was made. This makes it clear that no grant could have been made for the expenses of the temple and that a small portion of the proceeds was naturally spend on the temple by the Bavaji after the temple had been constructed. Any statement in these entries about the grant being both for Sadavarti and for the expenses of the temple appears to be due to the wrong inference of the person making the enquiry. He could easily commit such an error on account of the existence of a temple at the time of the enquiry and on account of the expression 'divine service '. The 'divine service ' really meant, as would appear from the expression in the other documents of the period 1698 to 1802 A.D., service by way of prayers for the stability and continuity of the State '. The expression that the grant was 'hereditary ' also supports the conclusion that the grant was to the Bavajee personally and not to the temple even if the temple existed at the time of the original grant. In fact, the sanad granted by Seetaram Ranzi Maharaja and produced before the enquiry officers explicitly stated that the proceeds of the village were to be appropriated for Sadavarti. 287 This extract therefore supports the case of the appellants even though the name of the temple has been mentioned along with Sadavarti Bairagi. The confirmation of the grant, tax free, was recommended by the Deputy Collector, Inam Commissioner, under Rule 3, Clause (1). The order of the Officiating Inam Commissioner dated July 1864 is: 'Confirmed on present tenure ', and column 9 described the tenure as 'tax free '. Exhibit P 51 is the extract from the Inam Register in the Zamindari estate of Tekkaly in the Chicacole Taluk, Ganjam District, and relates to the village Chinna Zavanapalli. The report of the Deputy Collector shows that the claim of the then Bavajee was that the village was granted in the name of Gopaladass, trustee and priest of the mattam in Hijari 1165, corresponding to 1752 A.D. It further records: "It is explained by the Zamindar 's shiristadar on behalf of the Zamindar that this was granted for the support of the mattam and this is not a personal grant. This was entered in the permanent settlement account as an agrahar. The object of the grant is to feed Bairagis and etc., who travel between Benaras and Rameswaram or supply victuals clothes and etc. This branch of charity is known by the name of 'sadavarti '. The proceeds of this village with the other villages, which granted for the support of the charity are appropriated to sadavarti and to worship the idols in the temple of the mattam. As this is granted on the whole for the support of the charity branch, it should, I think, be confirmed on its present tenure. " The entries under the various columns are practically on the lines of the entries in Exhibit P 50. The entries in this register also support the case of the appellants to the extent that the original grant 288 in 1752 A. D., was to the then Bavajee and was for the purposes of the charity. Exhibit P 52 is the extract from the Register of Inams with respect to village Vanzangi. It records very clearly: "The object of this grant is to give 'sadavarti ' to travellers, that is, distributing alms and supplying victuals to travellers. This grant was made during the reign of 'Alangir Padsha '. Ever since the Inam is continued undisturbed. About century ago, the trustees built a temple of Jagannadhaswamy. Now in addition to distributing alms and giving Sadavarti to Bairagis and others, the idol in the temple is worshipped and annual festivals are made. It appears that the Trustee is defraying charges to meet the object of the grant and that he is not mis appropriating the proceeds of the Inam in any way. " The inam was confirmed as a charity grant to Mandasu Sadavarty Charity according to the terms of the grant. This extract is of great importance as it, in clear terms, mentions that the object of the grant was to give sadavarti to travellers and that it was confirmed as a charity grant to this charity. It speaks of the erection of the temple and still states that the Trustee was defraying the charges to meet the object of the grant. This indicates that the expenses of the temple were taken to be incidental to the expenses of the entire sadavarti and that the temple was just an adjunct to the sadavarti institution. Exhibit P 7, Parwana dated November 15, 1722, corresponding to 14th day of Rabial Awwal, 1135 Hijiri, refers to the grant of this village to Poohari Fakir Sadavarti. Exhibit P 53 is the extract from the Register of Inams relating to village Ragolu in Chicacole 289 Taluk. It records: 'In the sanad it was mentioned that the inam was given for the support of fakirs to the original grantee about a century ago. The other notes in this extract are practically identical with those in Exhibit P 52. The final order of the Inam Commissioner was also in terms similar, and was 'confirmed to the fakirs the sadavarti charity according to the grant, free, there being no excess. It is interesting to note that in column 2 (general class to which inam belongs) is noted 'Dewadayam ', i.e., dedicated to God; that in column 8 meant for the description of the inam is noted: 'for the support of Pagoda of Sri Jagannadhaswami in Bondilipuram ', and that the entry in column 11 indicates that Anavaruddin Khan Bahadur made the grant in Hijiri 1171 corresponding to 1754 55 A. D. It is clear that the note about the land being dedicated to God is wrong in view of the definite statement that the Sanad mentioned that the inam was given for the support of fakirs to the original grantee (Mandasa Palahari Bairagi in Column 13) about a century ago and that it was the trustees of the institution who constructed the temple. When the temple was constructed by the trustees of the institution, viz., the Sadavarti institution, the original grant could not have been to the temple or to God. The entries in this extract confirm the construction we have placed on similar entries in Exhibit P 52 and other extracts indicating the grant to the temple. Exhibit P 54 is the extract from the Inam Register of No. 85 'Tallavalasa in the Taluk of Chicacole in the District of Ganjam. It is mentioned in this that Pratapa Rudra Narayana Devu granted this village to Falar Gosayi for the support of the 'Bavajee ' or Swami, in Hiziri 1141 which would correspond to about 1747 A. D. It is also noted in the report that the object of the grant was that the proceeds should be appropriated for divine purpose and that the proceeds were appropriated to the temple and sadavarti. The note 'for the support 290 of the pagoda of Jagannadhaswami ' in column 8 meant for the description of the inam, again, appears to be an entry made under an erroneous impression. There was no temple in existence when the grant was made in about 1747 A. D. Exhibit P 55 is an extract from the Register of Inams in the village of Balaga of Chicacole taluk dated August 13, 1881. It mentions, under the heading 'by whom granted and in what year, "the grant was made by Rajah Narayana Gazapati raz Bahadur under orders of Alamgir Padsha on 14th May of Hiziri 1171 corresponding with English years 1754 55. It is also noted: the Sanad granted is in existence. ' It is stated therein that as these lands appear from a former firman to have been granted to Sadavarti Mandass Bavaji for planting topes and raising buildings; they should be restored to him in pursuance of the long standing right. This means that the firman, which was not forth coming during the inam enquiry, dated from very early time. It must be noted again that this extract also describes the inam as Devadayam, i. e., dedicated to God. Again, clearly, this entry is wrong in view of the sanad which was in existence clearly stating that the lands were granted under a firman to Sadavarti Mandass Bavaji for planting topes and raising buildings and also in view of what is recorded in Exhibit P 12, a parvana of 1742 A.D., under the seal of Nawab Jafer Ali Khan. It records: "It has been proved that Mandas, the successor of Poohari (Poojari) Faqir Sadabarti has, per endorsement six kattis of land, free from assessment, in the village of Balaga and etc. , villages of the said Haveli Sircar, fixed for the expenses of the coming and going Fakirs in accordance with the sanads of the previous rulers. Therefore in consideration 291 of the blessings to follow, it has been confirmed as of yore. " It was the result of this wrong view of the enquiry officer that the Inam Commissioner confirmed the grant free of quit rent so long as the service was kept up, presumably the service of the deity, as the distribution of charity would not be properly described as 'service. ' The fact that the Inam Commissioner treated the grant relating to Exhibit P 50 to be in support of Sadavarti and for support of the temple of Sri Jagannadhaswami, would not make the grant for the purposes of the temple when the temple was itself not in existence at the time the grant was made and when a later sanad referring to it definitely stated that the original villages were granted for the purposes of charity. The observations of the Privy Council in Arunachellam 's Case (1) that in the absence of the original grant the Inam Register is of great evidentiary value, does not mean that the entry or entries in any particular column or columns be accepted at their face value without giving due consideration to other matters recorded in the entry itself. We have already stated that the 'divine service ' referred to in this entry does not refer to any religious worship but to the prayers to be offered by the grantee for the preservation of the State. We do not find anything on record to support the observations in the High Court judgment that the Bavajee, with the consent of the Ruler for the time being, constructed a temple and appropriated the income for carrying out the worship of the temple. No document states that the temple was constructed by the Bavajee after obtaining the consent of the ruler for the time being. Exhibits P 52 and P 55 just mentioned that the trustees built a temple of Sri Jagannadhaswami. The 292 expression 'trustees ' refers to the trustees of the Sadavarti institution and not to the trustees of the temple as such. There is nothing in these documents to support the view that the temple was built with the consent of the ruler for the time being. The appellants examined five witnesses to support their case that the Hindu public have no right to offer worship in the temple which is a private temple. The learned Judges described the statement of Janardhana Prasad Bhatt, P.W. 4, as worthless. No particular reliance is placed on his statement by the appellants in this Court. The appellants, however contend that the statements of the other witnesses have been rejected by the High Court for inadequate reasons. The first witness is Iswara Satyanarayana Sarma, P.W. 1. He was aged 63 at the time of his deposition in 1949. He was a Sanskrit and Telugu Pandit in the Municipal High School and practised as an Ayurvedic Doctor. He has given reasons for the view that the temple is not a public temple. It is not necessary to refer to them. His statement, has been rejected as he was considered to be interested in the Mahant who had been his patient and as the statement made by him that people including the sishyas, i.e., the disciples, take permission of the Mahant for worshipping, was considered artificial. This witness did not state that even disciples had to take permission of the Mahant for worship and so the latter reason was based on an erroneous impression of his statement, The mere fact that the Mahant consults him for his ailments and the ailments of other sadhus is no ground for him to make false statements. He is not under obligation to the Mahant. It may be that the Mahant is under obligation to him. The next witness is P. Kameswara Rao, P.W. 2. He is aged about 30 years. He was the 293 Additional Public Prosecutor of Vizagapatam, had been Municipal Councillor for a decade, President of the Co operative Central Bank and resided close to the temple. He was in a very good position to know about the public worshipping at the temple as a matter of right. He stated that he never found the public using the temple and that he himself might have visited the temple roughly about hundred times. He was put a direct question in cross examination and gave a clear cut answer. He denied from personal knowledge that the place was used as a place of public religious worship and that members of the public who were Hindus had a right of access to the temple for purposes of religious worship. It may be mentioned that the question also referred to the temple being built as a place of public religious worship and the answer would include a denial of this fact. It is obvious that the witness could not have known anything about it. He seemed to have overlooked the significance of this part of the question. We do not consider that his denying this fact on personal knowledge affects his veracity in any way, and especially, when he further stated that his personal knowledge consisted of three facts: (i) his attending the Rathayatra and seeing that no offerings of harati and dakshina were made; (ii) his not seeing any member of the public entering the temple whenever he entered into the temple; and (iii) whenever he entered the temple, he took the permission of the mahant. The learned Judges rejected his testimony with this observation: "The evidence of this witness is more like an advocate supporting the case of mahant than that of a witness, who has come into the witness box to speak of facts. The aforesaid facts based on his personal knowledge afford a very slender foundation for the conclusion which this witness has so boldly asserted in the witness box. " 294 The expression 'the aforesaid facts ' had reference to the facts on which his personal knowledge was based. These facts, in our opinion, afford good ground for the view expressed by him that the temple was not a public temple. He visited the temple so many times, and never saw any member of the public visit it. He himself took permission from the Mahant when he entered the temple. Nothing could be better corroboration of his own statement than his own personal conduct in seeking permission from the Mahant. We do not see any good reason for discrediting his testimony. The next witness is G. Venkata Rao, P.W. 3, aged 48 years. He is a chairman of the Municipal Council, Chicacole, Secretary & Vice President of the Co operative Central Bank. His statement has been considered to be very artificial. His statement that whenever he visited the temple he asked the permission of the Mahant is good corroboration of his statement that he considered the temple to be a private temple and not a public one. The facts that the Mahant is also a Municipal Commissioner and consults him occasionally as a doctor, are no good grounds to discredit him. The last witness the plaintiff No. 2, the predecessor of the appellant No. 2. He is undoubtedly interested in the success of the proceedings started by him. But that alone is no reason to ignore his statement altogether. In fact, his statement should be accepted in view of the support it gets from the statements of the other three witnesses just referred to. It is very significant, as pointed out by learned counsel for the appellants, that none from the Hindu public of the place has been examined for the respondent in support of its contention that the Hindu public go to this temple for worship as a matter of right. Quite a good number of people 295 should have been available for the purpose if it was a fact. The respondent, on the other hand, examined only M. Adinarayana Rao, who had been Inspector of Hindu Religious Endowments Board of the Chicacole division from 1946 to 1948. He certainly states that the temple in suit is a public temple in which all people can go as a matter of right for worship. It is a moot question as to how he can make such a statement even if he had seen a number of people entering the temple and worshipping there, which itself is not a fact. When there be good evidence about the temple being a private one, the mere fact that a number of people worship at the temple is not sufficient to come to the conclusion that the temple must be a public temple to which those people go as a matter of right as it is not usual for the owner of the temple to disallow visitors to the temple, even if it be a private one. He stated that there were several festivals like Nethroshasevam, the car festival and kalyanam. In cross examination he had to admit that he had not visited the kalyan festival and did not know when it was celebrated. This is sufficient to indicate that he is a zealous witness. He stated that there was an archak, but he could not give the archak 's name. Ordinarily, it need not have been expected of him to have known the archak 's name. But, considering that he was an Inspector of the Board and had visited the temple officially also and had to submit a report, it is rather difficult to believe that if he had really found an archak, a priest other than the Mahant and his disciples, he would not have considered it essential for the purposes of his enquiry to know his name. We see no reason to prefer his shaky statement to the statements of the witnesses examined for the appellants. 296 We need not consider the statements of the witnesses with respect to the features associated with the public temple and which are said to be absent in the temple in suit. It is admitted by the respondent 's witness that there is a Tulsi plant before the shrine. It is strenuously urged for the appellants that no public has a Tulsi Kotta, and this contention seems to find support from the statement made by the respondent 's witness in reexamination that generally, in Oriya temples no flag staffs are located and Tulsi plants are grown instead. The description of the temple with respect to its construction, equipment, practices, observances and the forms of worship are not inconsistent with the inference from the other evidence that the temple is not a public temple. The statement of the respondent 's witness that generally Oriya temples have no flag staffs and have Tulsi plants has significance in one other connection also. It was said in Mundancheri Koman vs Achuthan Nair (1) at page 408 that in the greater part of the Madras Presidency, where private temples were practically unknown, the presumption is that temples and their endowments form public charitable trusts. The presumption is certainly rebuttable. The evidence in this case sufficiently rebuts it. The temple is situate at a place which was practically at the boundary of the Madras Presidency, and close to the common boundary between that Presidency and Orissa. The presumption with respect to the temple in the Madras Presidency, therefore, will be a very weak one with respect to the temple so situated. We are therefore of opinion that the temple in suit is not a temple as defined in the Act as it is not used as of right by the Hindu community, or any section thereof, as a place of religious worship. We therefore allow the appeal with costs throughout, set aside the order of the Court below and 297 restore the order of the District Judge, Vizagapatam, setting aside the order of the Board dated March 28, 1947. Appeal allowed.

The Emperor Aurangazeb made certain grants to one Mukuldas Babajee, founder of the institution Poohari Fakir Sadavarthy, for the purpose of his maintenance and to carry on the distribution of Sadavarthy to Fakirs etc. The sixth head of the institution built a shrine for his private worship. It was adjunct to the aforesaid institution, and the public had no access to it without the permission of Mahant. The income from various properties granted to the founder and his disciples had been regularly utilised for the maintenance of the head of the institution and for distributing charities for the Sadhus and pilgrims; a part was spent on the expenses of the worship in the temple. The Board of Commissioners for Hindu Religious and Charitable Endowments, Madras held that the temple in suit was a public temple. The sole question for determination was whether this institution was a public temple as defined in the Act. ^ Held, that an institution would be a public temple within the Hindu Religious Endowments Act, 1926, if two conditions are satisfied; firstly, that it was a place of public religious worship and secondly, that it was dedicated to, or was for the benefit of, or was used as of right by the Hindu Community, or any section thereof, as a place of religious worship. When there be good evidence about the temple being a private one, the mere fact that a number of people worship at the temple, is not sufficient to come to the conclusion to the temple must be a public temple to which those people as a matter of right as it is not usual for the owner of together temple to disallow visitors to the temple, even if it be private one. In the present case the description of the temple with respect to its construction, equipment, practices, observances 277 and the form of worship are not inconsistent with the inference from the other evidence that the temple is not a public temple. The temple is not a temple as defined in the Act and it is not used as of right by Hindu Community, or any section thereof, as a place of religious worship. Held, further that the Inam Register is of great evidentiary value, but that does not mean that the entry or entries in any particular column or columns be accepted at their face value without giving due consideration to other matters recorded in the entry itself.

Civil Appeal Nos. 545 and 546 of 1960. Appeals from the judgment and order dated August 13, 1954, of the Madras High Court in Writ Petitions Nos. 743 and 748 of 1954. K.N. Rajagopal Sastri and P. D. Menon, for the appellants. The respondent did not appear. January 17. The Judgment of the court was delivered by SHAH, J. These are two appeals with certificates of fitness granted by the High Court of Judicature at Madras against certain orders passed in Writ Petitions under article 226 of the Constitution. One Ramaswami Iyer father of the respondent was assessed to income tax in the status of a Hindu Undivided Family. Ramaswami Iyer died in 1949 and the respondent M.R. Vidyasagar became the manager of the family. The family was a partner through its manager in a firm styled "The Madura Knitting Company", and the share in the profits of the partnership which was registered under the Indian Income tax Act was the principal source of its assessable income. Under section 18A of the Indian Income tax Act, the Hindu undivided family was liable to pay advance tax for each of the assessment years 1946 47, 1947 48 and 1948 49. The Income tax Officer, Madura, issued notices under section 18A (1) of the Indian Income tax Act for payment of advance tax on the basis of the preceding year 's income. It was open to the assessee to submit a revised estimate of his income under section 18A (2) in respect of the year in question and Ramaswami Iyer who was at the material time the 615 manager availed himself of the option to submit a revised estimate and estimated the income for each of the assessment years 1946 47 and 1948 49 at Rs. 45,000/ . The assessments of these two years were completed respectively on November 28, 1950 and February 29, 1951, and the income received from the Madura Knitting Company was included in the assessments under section 23(5). The Income Tax Officer assessed the total income of the Hindu undivided family for the year 1946 47 at Rs. 1,01,335/ and for the year 1948 49 at Rs. 3,10,697/ . As the total income assessed far exceeded the estimate of Rs. 45,000/ , submitted by the manager of the assessee family, the Income Tax Officer in making the assessment ordered the respondent to pay Rs. 6,999/12/ and Rs. 36,687/ respectively for the assessment years 1946 47 and 1948 49 as interest. In appeals against the orders of assessment by the Madura Knitting Company, by order dated March 12, 1954 the Income tax Appellate Tribunal reduced the income of the firm, and on that basis reduced the share of the family in the income of the firm for the year 1946 47 to Rs. 83,335/ and for the year 1948 49 to Rs. 2,83,868/ . The Income tax Officer, Madura, in giving effect to the orders passed by the Appellate Tribunal under the 3rd proviso to section 18A (6) reduced the interest to Rs. 4,358/ for the year 1946 47 and to Rs. 32,714/10/ for the year 1948 49, and called upon the respondent to pay the arrears of tax inclusive of interest so adjusted. The respondent then called upon the Income Tax Officer not to levy interest under section 18A (6) submitting that the levy was illegal and unjustified, and in the alternative requested that the interest be waived under the powers vested under the 5th proviso to section 18A (6) which was added by section 13 of the Indian Income tax (Amendment) Act (25 of 1953). The Income tax Officer declined to accede to the request and the respondent 's application to the 616 Inspecting Assistant Commissioner for cancelling the levy of interest was also rejected. The respondent then moved two petitions (Nos. 743 and 748) under article 226 of the Constitution in the High Court of Judicature at Madras for writs cancelling the orders imposing liability for payment of interest, contending that the levy of penal interest was opposed to law and was prima facie, unjustified on the facts and circumstances of the case. The respondent submitted that the levy of interest under section 18A(6) was penal in character and could not be imposed upon the legal representative of the deceased manager who was not in any manner responsible for the original return filed by the firm of which the manager was a partner. He also contended that the levy was not warranted by the provisions of the Indian Income tax Act inasmuch as in respect of the assessment years in question the respondent was not the assessee, that the delay in completing the assessment was not attributable either to the then manager of the family, Ramaswami Iyer or to himself and therefore, no liability for payment of interest could be imposed, and that in any event refusal to cancel the levy of interest was arbitrary and not based on any judicial exercise of discretion vested in the Income tax Officer. A Division Bench of the Madras High Court held that the provision imposing liability to pay interest under sub section (6) of section 18A was not opposed to law and could be enforced against the legal representative of the deceased manager, who was a partner of the assessee firm. The High Court, however, was of the view that as the Income tax Officer and the Inspecting Assistant Commissioner had failed to consider whether in the circumstances of the case, the reduction or waiver of the interest was justified, it be ordered that the Income tax Officer to decide whether the petitioner had made out a case for the exercise of the discretion vested in the 617 Income tax Officer to waive or reduce the interest under the powers conferred on him by the 5th proviso of cl. (6) of section 18A. Against that order with certificates of fitness these appeals are preferred by the Commissioner of Income Tax. Section 18A which imposes liability upon the tax payer to make advance payment of tax was incorporated into the Indian Income tax Act by Act 11 of 1944. That section enables the Income tax Officer on or after the 1st day of April in any financial year, by order in writing, to require an assessee to pay to the Central Government in specified instalments income tax and super tax payable on so much of such income as is included in the assessee 's total income of the previous year in respect of which he had been assessed. Under sub section (2), if the assessee who is required to pay tax by an order under sub section (1) estimates at any time before the last instalment is due that the part of his income to which the sub section applies for the period which would be the previous year for an assessment for the year next following is less than the income on which he is required to pay tax and accordingly wishes to pay tax which is less than amount he is required to pay, he may send to the Income Tax Officer an estimate of the tax payable by him, and pay tax as accords with his statement. It is, however, provided by sub section (6) inter alia that where in any year the assessee had paid tax under sub s.(2) on the basis of his own estimate and the tax paid is less than 80% of the tax determined on the basis of his regular assessment (so far as such tax relates to income to which the provisions of section 18 do not apply) simple interest at the rate of 6% per annum from the 1st day of January in the financial year in which the tax was paid upto the date of the said regular assessment shall be payable by the assessee upon the amount by which the tax so paid falls short of the said 80%. As originally enacted the liability to pay interest upon 618 the amount by which the tax paid fell short of 80% of tax was absolute. The Income tax Officer had no discretion in the matter, and was bound to impose liability for payment of interest. But by section 13 of the Indian Income tax (Amendment) Act, 1953 (25 of 1953), an additional proviso was enacted to sub section (6) in the following form: "Provided further that in such cases and under such circumstances as may be prescribed, the Income tax Officer may reduce or waive the interest payable by the assessee". This proviso was given retrospective effect as from April 1, 1952. Thereafter in exercise of powers conferred by section 59 the Central Board of Revenue added Rule 48 to the following effect: "48. The Income tax Officer may reduce or waive the interest payable under section 18A in the cases and under the circumstances mentioned below, namely: (1) Where the relevant assessment is completed more than one year after the submission of the return, the delay in assessment not being attributable to the assessee. (2) Where a person is under section 43 deemed to be an agent of another person and is assessed upon the latter 's income. (3) Where the assessee has income from an unregistered firm to which the provisions of clause (b) of sub section (5) of section 23 are applied. (4) Where the "previous year" is the financial year or any year ending near about the close of the financial year and large profits are made after the 15th of March in circumstances which could not be foreseen. 619 (5) Any case in which the Inspecting Assistant Commissioner considers that the circumstances are such that a reduction or waiver of the interest payable under section 18A (6) is justified. The effect of the incorporation of the 5th proviso in section 18A (6) and of Rule 48 was manifestly to authorise the Income Tax Officer in exercise of his discretion to relieve against the rigour of the inflexible rule originally enacted in cl. (6) about payment of interest by the assessee when the tax paid by him on his estimate fell below 80% of the tax payable on regular assessment. The only question which falls to be determined in these appeals is whether the benefit of the fifth proviso to section 18A (6) could be claimed in respect of the assessments of the income of the respondent 's family which were completed by the Income tax Officer before April 1, 1952. The High Court was of the view that even if the assessment by the Income Tax Officer was completed before April 1, 1952, if the final adjustment pursuant to the order of the Appellate Tribunal was made after that date the Income Tax Officer was competent, in exercise of the powers with which he was invested by the fifth proviso to cl. (6) of section 18A to reduce or waive the interest payable by the assessee and the Income tax officer having failed to exercise his discretion a case was made out for the issue of a writ under article 226 of the Constitution directing that officer to consider whether in the circumstances of the case relief may be granted to the respondent. On behalf of the Commissioner of Income tax it is urged that the power conferred by the fifth proviso may undoubtedly be exercised in those cases where assessment is completed on or after April 1, 1952, but where the assessment was completed and liability to pay interest had crystallized under 620 sub s.(6) as it originally stood, the Income tax Officer has no power under the amended sub section to reduce or waive the interest ordered to be paid by the assessee even if the proceedings in assessment are pending in appeal before the Appellate Assistant Commissioner or the Appellate Tribunal. It was urged that the interest under section 18A(6) is payable upto the date of the regular assessment and if in the contingencies prescribed by section 18A(6), as originally enacted liability to pay interest crystallized, the Income tax Officer could not, in exercise of the power invested by the amending Act reopen the order, because the legislature had given to the amending statute only a partial retroactive operation and its retroactivity could not be enlarged; to do so, would be plainly to defeat the plain intendment of the Legislature. It is unnecessary for the purpose of these appeals to consider whether an assessment which has become final before the date on which the fifth proviso came into operation, and which is not subject to any pending appeal, can be reopened and the benefit of the power conferred by the fifth proviso be afforded to an assessee. The question which falls to be determined is whether in an assessment subject to an appeal which is pending, or which may be lawfully filed, the power to reduce or waive the interest can be exercised. There is, in our judgment, inherent evidence in the rule indicating that such a power can be exercised even if the regular assessment is completed by the Income tax Officer before April 1, 1952. The power vested in the Income tax Officer to reduce or waive interest payable by an assessee is exercisable "in such cases or such circumstances as may be prescribed" by the Rules. By Rule 48 the Income tax Officer is given the power to reduce or waive interest payable under section 18A(6) in the events specified therein. By the first clause of Rule 48 where the assessment is completed more than one year after the submission of the return the delay in assessment 621 not being attributable to the assessee the power of the Income tax Officer may be exercised There is nothing in the Rule which indicates that the power to grant relief may be exercised only before the regular assessment is completed by the Income tax Officer. The terms of clauses (1) and (5) of the Rule clearly support the view that the order reducing or waiving interest may be passed even after the order of assessment is made, and interest is included. Again, by making Act 25 of 1953 operative retrospectively from April 1, 1952, the Legislature has evinced an intention that to regular assessments made between April 1, 1952, and the date on which the Act was enacted, the fifth proviso to 18A(6) may apply. The argument that liability to pay interest crystallizes when the Income tax Officer incorporates the direction for payment of interest, because the order is not made appealable has no force. The order for payment of interest was liable to be modified if the assessment of income was varied by the Appellate Assistant Commissioner, or by the Tribunal. It is true that interest could be charged upto to the date of regular assessment by the Income tax Officer but that does not support the theory of crystallization of liability. If therefore the quantum of liability was capable of being altered even after the date of the regular assessment, the assumption that the power to give relief against a rigid statutory provision should be restricted to cases which are decided by the Income tax Officer only after April 1, 1952, is not warranted. The power of the Income tax Officer arose only after April 1, 1952, but there is nothing in the act to show that it was to be exercised only in respect of assessments made by the Income tax Officer after that date. In our judgment, the jurisdiction under the fifth proviso may be exercised by the Income tax Officer in all cases which are pending on April 1, 1952, before the Income tax Officer or any superior authority having under the Income tax Act power 622 to modify the assessment of income, or are commenced after that date. In the present case, the original assessments made by the Income tax Officer in both the years in question were modified in view of the orders passed by the Appellate Tribunal in the assessment of the Madura Knitting Co. The order of the Appellate Tribunal was passed on April 12, 1953, i.e. after the date on which Act 25 of 1953 came into operation. After that date the Income tax Officer was bound to give effect to the orders of the Appellate Tribunal and to adjust liability in computing the assessable income and the tax payable thereon. The Income tax Officer being bound to adjust liability to pay interest under cl. (6) of section 18A we see no reason why in adjusting that liability he may not exercise the powers with which he has been invested since April, 1952, if the circumstances of the case warrant such exercise. In our view the High Court was right in holding that the Income tax officer had the power in the case of the assessments in question to exercise the authority conferred by the fifth proviso to section 18A(6) and he having failed to exercise the discretion, a writ requiring him to consider whether a case is made out for the exercise of his discretion was properly issued. These appeals therefore fail and are dismissed. Appeals dismissed.

The Income tax Officer, Madura, issued notice under section 18A (1) of the Indian Income Tax Act, 1922, for payment of advance tax. R, the then manager of the Hindu Undivided family availed of the option to submit a revised estimate for the years 1946 47 and 1948 49. The assessment of these two years were completed respectively in November, 1950 and February, 1951, as the total income assessed far exceeded the estimate submitted by R, the Income tax Officer ordered the respondent, the legal representative of R, to pay the interest under section 18A (6) of the Act. On appeal, the Income tax Appellate Tribunal reduced the income and the Income tax Officer in giving effect to the said order reduced the interest and called upon the respondent to make payment. The respondent asked the Income tax Officer not to levy interest under section 18A (6), submitting that the levy was illegal and unjustified, alternatively he requested that the interest be waived by virtue of the powers vested on the Income tax Officer under proviso 5 to section 18A (6) which was added by section 13 of Act 25 of 1953, with retrospective effect from April 1952. The Income tax Officer and the Inspection Assistant Commissioner declined to accede to the request. The respondent then moved the High Court at Madras for a writ under article 226 cancelling the levy of interest on the ground among others that refusal by the Revenue authorities to cancel the levy was arbitrary and not based on any judicial exercise of the discretion vested by the Act. The High Court upheld the plea, ordered the Income tax Officer to decide whether the respondent had made out a case for the exercise of the discretion. The only question in the appeal before the Supreme Court was whether benefit of the said 5th proviso to section 18A (6) may be granted in respect of assessments of income which were completed by the Income tax officer before April 1952. 614 ^ Held, that the jurisdiction under 5th proviso of section 18A (6) of the Income tax Act may be exercised by the income tax Officer in all cases which were pending on April 1, 1952 before him or any superior authority having under the Act power to modify the assessment of income.

ION: Criminal Appeal No. 167 of 1961. Appeal by special leave from the judgment and order dated September 29, and October 11, 1961, of the Bombay High Court in Criminal Appeal No. 906 of 1961. section G. Patwardhan, J. B. Dadachanji, O. C. Mathur and Ravinder Narain for the appellant. H. R. Khanna and P. D. Menon for the respondent. January 18. The Judgment of the Court was delivered by KAPUR J. This is an appeal against the judgment and order of the High Court of Bombay secting aside the order of acquittal of the appellant and sentencing her to one year 's rigorous imprisonment and evicting her from the premises which she was occupying as a tenant. The appellant was tried by the Additional Chief Presidency Magistrate, Esplanade, Bombay for offences under sections 3(2) and 4(1) of the Suppression of Immoral Traffic in Women and Girls Act (Act 104 of 1956) hereinafter called the 'Act '. The charge against the appellant was that she supplied a girl to Manmohan Anandji Mehta who is a witness and she kept or managed a brothel at block No. 6, plot No. 144; Shivaji Park, Bombay; that she knowingly lived on the earnings of prostitution and that the procured women for the purpose of prostitution. The story of the prosecution was that information was received by Police Superintendent Kanga that the premises were being used as a brothel and that the appellant was supplying 634 girls for the purpose of prostitution. He thereupon laid a trap and sent two persons, Manmohan Anandji Mehta and Prabhakar K. Loke, the former was to ask for a girl for the purpose of prostitution and the latter was to be a panch i. e. a witness of that fact. Sub Inspector Purohit, it is stated, gave two one hundred rupees marked currency notes to Manmohan Anandji Mehta with the instruction that he was to pay out of that to the appellant and thus to obtain a girl from her for the purpose of prostitution. He along with Loke went to the house of the appellant, rang the bell and was admitted by her. He then asked the appellant to arrange a girl for him and both Manmohan Anandji Mehta and Loke are alleged to have said that they wanted two girls for enjoyment. Two girls were shown, one Kamal Govind and the other Indu Bapurao Salunke both of whom are witnesses. The amount quoted by the appellant in the case of the former was Rs. 100/ and for the latter Rs. 50/ . Manmohan Anandji Mehta selected Kamal and handed over heroine one hundred rupees currency note to the appellant which she put under her blouse. Manmohan Anandji Mehta and the girl then went into the kitchen and there they undressed and were later found naked on the floor and in a rather compromising position. On a signal being given the police i.e. Superintendent Kanga and Sub Inspector Purohit entered the premises and were told by Loke that Manmohan Anandji Mehta and the girl were in the kitchen. The police officers opened the door of the kitchen and found both Manmohan Anandji Mehta and Kamal as stated above. They then were asked to dress and come out. Manmohan Anandji Mehta then returned the other one hundred rupees currency note to superintendent Kanga. A woman Panch who had accompanied the police party searched the appellant and recovered the one hundred rupees currency note from under the blouse. It is stated that the male members of the party were at that time in a passage adjoining the 635 hall where the appellant was searched. The appellant was tried for the offences above mentioned but was acquitted by the Additional Chief Presidency Magistrate. On appeal the High Court set aside the order of acquittal and sentenced her to a year 's rigorous imprisonment and also ordered her eviction from the premises she was occupying as a tenant. The evidence mainly consists of Manmohan Anandji Mehta and Loke and the two police officers. The testimony of Manmohan Anandji Mehta and Loke by itself may not, in the circumstances of the case, be of much value but their testimony receives corroboration and thus gives credence to the prosecution case. The evidence of Police Superintendent Kanga shows that when the door of the kitchen was pushed open both Kamal and Manmohan Anandji Mehta were naked and were in a compromising position; their clothes were lying by the side of the mattress, The testimony of Sub Inspector Purohit is also to the same effect. The other circumstances which is very much against the appellant is that there is evidence to show that when the woman panch accompanied the police party and searched the appellant a hundred rupees currency note was found from her person under her blouse. The fact is deposed to by Sub Inspector Purohit and by Police Superintendent Kanga. Loke has also deposed to the same effect. But it was submitted on behalf of the appellant that this evidence should not be accepted as, according to law, no woman can be searched except by another woman and having regard to the emphasis on decency under sections 52 and 103 of the Criminal Procedure Code that cannot be done in the presence of men. There is no evidence to show except that of Manmohan Anandji Mehta that the men were asked to move away from the hall or had actually left the hall during the search. But assuming they were not in the hall even then it will not be an extraordinary circum 636 stance that one or all of them should have seen the hundred rupees, note being taken out from under the blouse of the appellant. The High Court has, accepted the testimony of Loke and we find no reason to depart from the usual practice of this Court, of accepting such findings. Besides, the High Court has also accepted the testimony of Loke in regard to the payment of a hundred rupees currency note to the appellant which proves that money was paid before the girl, Kamal Govind, was asked to go with Manmohan Anandji Mehta for the purpose of prostitution. Counsel for the appellant emphasised two points: (1) that the woman, who was brought by the police to search the appellant and is alleged to have recovered the hundred rupees note from her person, has not been produced and (2) that considering that the person to be searched was a woman it must be presumed that in accordance with the requirements of law and of decency no man could have been present when the search of the appellant took place. In support of the first contention reference is made to a judgment of this, Court in Purvez Ardeshir Poonawalla vs The State of Bombay(1), where the necessity of producing the search witness was emphasised and it was observed: "This is, one of those cases where the rule in regard to search witnesses becomes applicable and importance must be attached to the lack of that class, of search witnesses which are envisaged by the Criminal Procedure Code in section 103. " The Privy Council also in Malak Khan vs Emperor(2) emphasised the necessity of the presence of search witnesses. Lord Porter there said: "In their Lordship 's opinion the presence of witnesses, at a search is always desirable and their absence will weaken and may sometimes destroy the acceptance of the evidence as, to the finding of the articles. ." 637 The observations in Poonawalla 's case (1) and Lord Porter in Malikkhan vs Emperor (2) are not directly applicable in the present case. As we have said above there is evidence in this case which has been accepted by the High Court that a hundred rupees note was given to the appellant by Manmohan Anandji Mehta. There is also evidence that as a consequence of the payment of money Manmohan Anandji Mehta did hire Kamal Govind for prostitution and it is regrettable to say that with the money given to him by the police he acted not merely as a 'bogus customer ', as he has been described, but his participation was more active, reprehensible, immodest, indecent and indecorous. If in any case the following observations of Lord Goddard, Chief Justice, in Brannan, vs Peek (3) are apposite it is this case: "The court observes with concern and disapproval the fact that the police authority as Derby thought it right to send a police officer into a public house to commit an offence. It cannot be too strongly emphasised that,. it is wholly wrong for a police officer or any other person to be sent to commit an offence in order that an offence by another person may be detected. " We have only to substitute the words "aid an act of prostitution" for "to commit an offence" and the analogy is complete. In this case two youngmen were given money to go to the house of the appellant and also to use that money in rather an improper manner. Manmohan Anandji Mehta seems to be a person of rather doubtful character and the employment of this class of persons for detection of offences is hardly a credit to any one. What is more reprehensible and a matter of greater concern is the sending, with him a young student who was reading for his Matriculation. To use students in 638 this manner should not be allowed by any governmental authority in a country like ours. It is no justification to say that, in order to suppress immoral traffic in women and to stop prostitution somebody has to be used and the only class of people that can be employed are persons like Manmohan Anandji Mehta who is confessedly a police agent and Loke who is a youngman willing to be employed by the police. After saving this we have still to see what is the consequence of the testimoney of these witness produced in this case. The High Court has believed the testimony of Loke in regard to the payment of one hundred rupees and there is evidence to show that amount was used for the purpose of procuring Kamla for prostitution. The payment must therefore be held to be proved. It may be that the search was contrary to the spirit or even the letter of the Criminal Procedure Code but the fact remains that the High Court has accepted that there was a search and a hundred rupees currency note was recovered and even if the recovery of a hundred rupees currency note were held not proved, the payment of that amount will not thereby become unproved if there evidence which the High Court has accepted. On the findings of the High Court we are unable to come to any other conclusion but the one to which the High Court came that the appellant is guilty of the offences of which she was accused. The next submission of Counsel for the appellant was that the High Court in appeal could not order the appellant 's eviction because that power only a Magistrate has under section 18 of the Act. The argument raised was that the powers of the appeal court under section 423, Criminal Procedure Code are to reverse the order of acquittal or to order a fresh enquiry or a retrial etc. but not to order eviction. But this argument is untenable in view of the fact that in the Act there is a specific provision in section 18 639 of the Act authorising the making of such an order by a court convicting a person of offences under section 3 or section 7 of the Act. The relevant portion of section 18 is as follows: section 18 "Closure of brothels and eviction of offenders from the premises, (1). . ,and if after hearing the person concerned, the magistrate is satisfied that the house. . or portion is being used as a brothel or for carrying on prostitution then the magistrate may pass orders (a) directing eviction of the occupier within seven days of the passing of the order from the house. . (2) A court convicting a person of any offence under section 3 or section 7 may pass orders under sub section (1) without further notice to such person to show cause as required in that sub section. " The High Court ordered the conviction of the appellant under section 3 of the Act and therefore it had the power to order her eviction. The second contention is also without substance. The appeal is therefore dismissed. Appeal dismissed.

On learning that the appellant was using her premises as a brothel and was supplying girls for the purpose of prostitution, the police arranged to lay a trap. With two one hundred rupees marked currency notes given by the police two persons, M and L, went to the premises occupied by the appellant; M was to ask for a girl for the purpose of prostitution and L was to be a witness of the fact. M selected a girl and gave the one hundred rupees note to the appellant who put it under her blouse. When M and the girl were in the room, on signal being given, the police entered the room and found them in a rather compromising position. A woman Panch who had accompanied the Police party searched the appellant and recovered the one hundred rupees currency note from under the blouse. The appellant was tried for offences under ss.3(2) and 4(1) of the Suppression of Immoral Traffic in Women and Girls Act, 1956, by the Magistrate who, however, acquitted her. On appeal, the High Court accepted the prosecution case and convicted the appellant and, further ordered her eviction. The High Court accepted the testimoney of L in regard to the payment of the hundred rupees currency note to the appellant and also the evidence in the case to show that the amount was used for the purpose of prostitution. The appellant contended (1) that the conviction was bad because it was based only on the evidence of the police and its agents, and the search was not conducted in accordance with the provisions of the Code of Criminal Procedure, and (2) that, in any case, only the Magistrate was given the power of eviction under section 18 of the Act. ^ Held, that on the evidence accepted by the High Court, the conviction of the appellant was valid. The practice of the Governmental authority, like the police, employing young men, particularly students studying at the educational institutions, as in the present case, in 633 order to suppress immoral traffic in women and to stop prostitution, condemned. Held, further, that the High Court having ordered the conviction of the appellant, had the power to evict her under section 18 of the Act.

Civil appeal No. 646 of 1961. Appeal by special leave from the judgment and decree dated April 7, 1961, of the Punjab High Court in Civil Revision No. 354 of 1959. Gopal Singh, for the appellates. Bishan Narain and Naunit lal, for the respondent No. 1. 1962. January, 17. The Judgment of the Court was delivered by HIDAYATULLAH, J. This is an appeal by special leave against an order of the High Court of Punjab at Chandigarh, dated April 7, 1961. The appellants are five tenants, who have been evicted from certain shops and chobaras in the town of Patiala, on the application of the first respondent, the landlord. The application by the landlord was made in June, 1957, under section 13 of the Patiala and East Punjab States Union Urban Rent Restriction ordinance, 2006 BK (No. VIII of 2006 BK). The grounds urged by the landlord were (a) non payment of rent by the tenants, (b) non payment of house tax by the tenants and (c) that the shops were in a state of great disrepair and were dilapidated, and the landlord wished to rebuild them after dismantling the structures. The landlord averred that he had obtained sanction of the Municipal Committee to a proposed plan of construction, and accumulated some building material before making the application. The tenants resisted the application. The Rent Controller framed issues relating to the three 625 grounds; but the first two have ceased to be material now. On the issue relating to the third ground, the Rent Controller held that in deciding whether the tenants should be ordered to hand over possession to the landlord, the Courts must have regard to the bona fides of the request of the landlord, which meant that the desire to rebuild the premises should be honestly held by the landlord, but that the condition of the building also played an important part in determining whether the landlord had the intention genuinely and was not using this excuse as a devise to get rid of the tenants. In this connection, the Rent Controller observed that the state of the building, the means of the landlord, and the possibility of a better yield by way of rent, all entered into the appraisal of the landlord 's state of mind. Examining the case from this angle, the Rent Controller held that there was hardly any proof that the building was in a dilapidated condition. One solitary witness who testified to this, admitted that he had not seen the building from the inside. The landlord himself did not give evidence. On the other hand, there was ample evidence that the building was good. As regards the financial status of the landlord, the witnesses who stated on his behalf that, he could spend Rs. 5,000 to Rs. 10,000 knew nothing about his means. Even the landlord 's brother. who conducted this case on behalf of the landlord, could not give any details. The plan showed a building requiring about Rs. 20,000 to build. The landlord had an income of Rs. 200/ per month and his family consisted of his wife and five children. The Rent Controller, therefore, held that he had no means to rebuild the premises. The Rent Controller did not feel impressed by the alleged purchase of 40 bags of cement, because a greater part of the cement was used up already in building two or three latrines, and the quantity left was wholly insufficient for the proposed building. He, therefore, decided the issue against the landlord. 626 On appeal, these findings were confirmed by the appellate authority, who held that the shops and chobaras were in good condition, and that the landlord was not, in good faith, wanting to replace the building, when he had no means to built it. Against the order of the appellate authority, an application for revision purporting to be under section 15(5) of the East Punjab Urban Rent Restriction Act, 1949 (3 of 1949), was filed in the High Court. This application was allowed. The learned single Judge posed the question thus: "The question in the present case is whether there is a bona fide desire to rebuild the premises?". He referred to an earlier decision of a Divisional Bench of that Court (Civil Revision No. 223 of 1960), in which Gosain, J., laid down the law in the following words: "It is pertinent to note that the word 'building ' in the aforesaid clause is not qualified by the words 'requiring reconstruction ' or 'requiring rebuilding '. The landlord can, in these circumstances, require any building for the re erection of the same, and when in any case a claim to that effect is made by him the only point that has to be determined is whether on the facts and circumstances of that case his requirement is bona fide. A building, for instance, may not be immediately unsafe, but its condition may be such that unless it is reconstructed it may involve the landlord at a later date very heavy expenditure. All round a particular building different types of buildings may have been constructed of an entirely different design and the particular building in question may then be looking very ugly and the landlord may want to bring the same in conformity with the structures around it. " 627 After quoting this passage, the learned Judge observed that the consideration which must weigh in determining the question of ejectment is whether the landlord genuinely wants to rebuild the premises, and further, that the actual condition of the premises is "a wholly irrelevant factor". In dealing with the merits of the case, the learned Judge referred to the offer of the landlord to put back the tenants in possession, if the premises were not demolished within a month of his obtaining possession thereof, and concluded, without discussing the evidence, as follows: "Upon the evidence on record it seems to me established beyond all doubt that the landlord genuinely and bona fide requires these premises for rebuilding." He, therefore, set aside the concurrent orders of the two Tribunals, and ordered the eviction of the tenants, giving them two month 's time in which to vacate the premises. Two questions have been argued in this appeal. The first is that the revision application is incompetent, because under s.16(4) of the Patiala and East Punjab States Union Urban Rent Restriction ordinance, 'the decision of the appellate authority and subject only to such decision, an order of the Controller shall be final and shall not be liable to be called in question in any court of law whether in a suit or other proceeding by way of appeal or revision". It is contended that s.15(5) of the East Punjab Urban Rent Restriction Act, which conferred a power of revision on the High Court does not apply to the present case, because this case did not arise in proceedings taken under the Act. The next contention is that the interpretation placed by the learned Judge upon section 13(3) (a) (iii) read with section 13 (3) (b) is erroneous, and that the High Court had no power to reverse a concurrent finding of fact without itself re appraising the evidence, if at all. 628 On the first point, the learned counsel for the respondents relies upon a decision of this court reported in Moti Ram vs Suraj Bhan (1), where it was held that a revision application in analogous circumstances was maintainable. In our opinion, even if a revision application lay, the learned single Judge was in error in his interpretation of the relevant sections of the ordinance, and in reversing a concurrent finding of fact, without giving any substantial reasons. Section 13 of the ordinance, omitting portions which are irrelevant here, reads as follows: "13. (1) Notwithstanding anything contained in any other law for the time being in force, a tenant in possession of a building or rented land shall not be evicted therefrom in execution of a decree passed before or after the commencement of this ordinance or otherwise and whether before or after the termination of the tenancy, except in accordance with the provisions of this section. x x x (3) (a) A landlord may apply to the Controller for an order directing the tenant to put the landlord in possession. x x x (iii)in the case of any building, if he requires it for the re erection of that building or for its replacement by another building, or for the erection of other building; x x x (b) The Controller shall, if he is satisfied that the claim of the landlord is bonafide, make an order directing the tenant to put the landlord in possession of the building or rented land on such date as 629 may be specified by the Controller, and if the Controller is not so satisfied, he shall make an order rejecting the application; x x x (4) where a landlord who has obtained possession of building or rented land in pursuance of an order under. sub paragraph (iii) of the aforesaid paragraph (a) put that building to any use or lets it out to any tenant other then the tenant evicted from it, the tenant who has been evicted may apply to the Controller for an order directing that he shall be restored to possession of such building or rented land and the Controller shall make an order accordingly. " Reading these provisions as a whole, it is obvious that if the landlord 's need be genuine and he satisfies the Controller, he can obtain possession of the building or the land, as the case may be. If, however, he does not re erect the building and puts it to any other use or lets it out to another tenant, the former tenant can apply to be put back in possession. Clause (b) clearly shows both affirmatively and negatively that the landlord must satisfy the Controller about his claim, before he can obtain an order in his favour. The Controller has to be satisfied about the genuineness of the claim. To reach this conclusion, obviously the Controller must be satisfied about the reality of the claim made by the landlord, and this can only be established by looking at all the surrounding circumstances, such as the condition of the building, its situation, the possibility of its being put to a more profitable use after construction, the means of the landlord and so on. It is not enough that the landlord comes forward, and says that he entertains a particular intention, however strongly, 630 said to be entertained by him. The clause speaks not of the bona fides of the landlord, but says, on the other hand, that the claim of the landlord that he requires the building for reconstruction and re erection must be bona fide, that is to say. honest in the circumstances. It is impossible, therefore, to hold that the investigation by the Controller should be confined only to the existance of an intention to reconstruct, in the mind of the landlord. This intention must be honestly held in relation to the surrounding circumstances. In our opinion, the interpretation placed by the Punjab High Court (in the decision of Gosain, J.) puts too narrow a construction, and leaves very little for the Controller to decide. It is well known that Rent Restriction Acts were passed in view of the shortage of houses and the High rents which were being demanded by landlords. The very purpose of the Rent Restriction Acts would be defeated, if the landlords were to come forward and to get tenants turned out, on the bare plea that they want to reconstruct the houses, without first establishing that the plea is bona fide with regard to all the circumstances, viz., that the houses need reconstruction or that they have the means to reconstruct them, etc. The two Tribunals below had gone into the matter thoroughly, and had agreed that the landlord had neither the means to reconstruct the building nor had he made any attempt to face cross examination as a party. They were also of the opinion that the building was in a good state and did not need to be pulled down or reconstructed. With such clear findings, one would expect that a revising Court, however vide its powers may be, would, at least, go into the question over again, if it was going to depart from this unanimous conclusion. It is hardly necessary to go into the question of the extent of the powers of the High Court under section 15(5) of the Rent Restriction Act. They have been adverted to in the ruling of this Court, above mentioned. They 631 do not, however, include the power to reverse concurrent findings, without showing how those findings are erroneous. In the present case, the learned Judge has given his conclusion without adverting to single piece of evidence, from which his conclusion was drawn. In these circumstances it cannot be said that he had examined the propriety of the order sought to be revised, even under the provisions of the law he was administering. Learned counsel relying upon the case to which we have already referred, said that there the sanction by the Municipal Committee was taken into consideration in deciding the need of the landlord. The facts in that case are not fully stated, and from the observations, it would appear that there was other evidence besides the sanction by the Municipal Committee, on which the conclusion of the High Court was supported. In any event, a case cannot be an authority on a point of fact, and each case will have to be examined in the light of the circumstances existing in it. In the present case, the two Tribunals specially appointed to consider these matters, went thoroughly into the question, and discussed it from a correct angle. If they had examined they facts after instructing themselves correctly about the law, a Court of revision should be slow to interfere with the decision thus reached, unless it demonstrates by its own decision, the impropriety of the order, which it seeks to revise. No attempt of this kind has been made in this case, and in our opinion, the High Court was not justified in reversing the clear finding. In the result, this appeal must be allowed. The order of the High Court is set aside, and that of the appellate authority is restored. The landlord shall pay the costs here and in the High Court. Appeal allowed.

The application for eviction against the appellant was based inter alia on the ground that the premises in suit were dilapidated and the landlord wished to rebuild them after dismantling the structure. The Rent Controller dismissed the application observing that there was hardly any proof that the building was in a dilapidated condition and that the landlord had no means to rebuild the premises. The appellate authority confirmed the finding holding that the premises were in good condition and that the landlord was not, in good faith, wanting to replace the building. An applications purporting to be under section 15(5) of the East Punjab Urban Rent Restriction Act, 1949, was made before the High Court. The High Court following an earlier decision of the same Court allowed the revision petition holding that in determining the question of ejectment, what needs alone to be considered is whether the landlord genuinely wants to rebuild the permises and that the condition of the premises is 'a wholly irrelevant factor '. ^ Held, that the investigation by the Rent Controller cannot be confined only to the existence of an intention in the mind of the landlord to reconstruct. This intention must be honestly held in relation to the surrounding circumstances, otherwise the very purpose of the Rent Restriction Act would be defeated, if the landlords were to come forward and to get tenants turned out, on the bare plea that they want to reconstruct the house without first establishing, that the plea is bona fide with regard to all circumstances, viz. that the houses need reconstruction or that they have the means to reconstruct them. Held, further, that when the Tribunals have examined the facts after instructing themselves correctly about law, a Court of Revision should be slow to interfere with the decision, thus reached, unless it demonstrates by its own decision the impropriety of the order which it seeks to revise. Under section 15(5) of the East Punjab Urban Rent Restriction Act, 1949, the powers of the High Court do not include 624 powers to perverse a concurrent finding without showing how those finding are erroneous and without giving any substantial reasons for its finding. Held, also, that a case cannot be an authority on a point of fact and reach case has to be examined in the light of the circumstances existing. Moti Ram vs Suraj Bhan, [1960] 2 section C. R. 896, referred to.

Civil Appeal No. 466 of 1960. Appeal from the judgment and order dated October 31, 1958 of the Kerala High Court in I. T. R. No. 2 of 1956 (K). K. N. Rajagopal Sastri and P. D. Menon, for appellant. The respondent did not appear. January 16. The Judgment of the Court was delivered by HIDAYATULLAH, J. The Commissioner of Income Tax, Kerala and Coimbatore, has filed this appeal against the judgment and order of the High Court of Kerala dated October 31, 1958, by which the High Court answered in favour of the respondent (Helen Rubber Industries, Ltd., Kottayam) the following question: "Whether under the provisions of the Indian Income tax Act the petitioner is entitled to carry forward the loss for a period of six years notwithstanding the fact that during the period when the loss had occurred, the law applicable was the Travancore Income tax Act ?" The High Court has granted a certificate under section 66A(2) of the Income tax Act. Two questions were referred to the High Court in compliance with an earlier order of the High Court under section 66(2); 607 but with the other question, we are not concerned in this appeal. Messrs. Helen Rubber Industries, Ltd. is a Company, which was incorporated in the former State of Travancore with its registered office at Kottayam. In the year 1941, the assessee Company granted a lease of the factory to certain persons for a period of 15 years. From that year, the rent and royalty received from the lessees were the only source of income. Disputes having arisen, the lessees suspended payment from June 1946. Litigation followed; but the dispute was settled by the assessee Company receiving Rs. 23,000/ odd in full satisfaction. With the details of these disputes and their settlement, we are not concerned. The year of account of the assessee Company is the Calendar year. Before the extension of the Indian Income tax Act, there was in force in Travancore State, the Travancore Income tax Act, 1121 M. E. (Act XXIII of 1121 M. E.), which came into force on the first day of Chingom 1122 M. E. (August 17, 1946). The assessment year under the Travancore Act ended on the last day of Karkadakom, which corresponds to August 16, 1947. Thus for the account year, 1 1 1946 to 31 12 1946 of the firm the assessment year was 1123 M. E. (17 8 1947 to 16 8 1948). The assessee Company declared losses in the account years, 1946, 1947 and 1948. These losses, together with the dates of the account years and the assessment years are tabulated below: Year of account Year of assessment. Loss 1946(1 1 1946 to 1123 M. E. (17 8 1947 Rs. 4031 10 0 31 12 1946) to 16 8 1948) 1947(1 1 1947 to 1124 M. E.(17 8 1948 Rs. 6605 1 6 31 12 1947) to 16 8 1949) 1948 (1 1 1948 to 1125 M. E. (17 8 1949 Rs. 2604 13 9 31 12 1948) to 16 8 1950) Total Rs. 13241 9 3 608 The dispute in this case is about the right of the assessee Company to carry forward the loss of the year 1946 under the provisions of the Travancore Act read with section 24(2) of the Indian Income tax Act and the Taxation Laws (Part B States) (Removal of Difficulties) Order, 1950 to the assessment year, 1951 52, in the assessment of the Company for its year of account, the Calendar Year, 1950. The Income tax Officer held that the loss of the year 1946 could not be carried forward to that year, since it had lapsed after two years under section 32 of the Travancore Act, and section 24(2) was not applicable, in view of paragraph 3 of the Order, mentioned above. The order of the Income tax Officer was confirmed in appeal by the Appellate Assistant Commissioner and the Appellate Tribunal. The Tribunal was moved for a case, but declined to state one; but the High Court called for a statement of the case under section 66(2) and the above mentioned question was decided in favour of the assessee Company. The only question argued in this appeal is whether the High Court was right in the answer it gave. The assessee Company was not represented at the hearing before this Court. The Indian Income tax Act was extended to Travancore Cochin by section 3 of the Indian Finance Act, 1950. By section 13(1) of the same Act, it was provided: "If immediately before the 1st day of April, 1950, there is in force in any part B State. any law relating to income tax that law shall cease to have effect except for the purposes of the levy, assessment and collection of income tax. . in respect of any period not included in the previous year for the purposes of assessment under the Indian Income tax Act, 1922 (XI of 1922), for the year ending on the 31st day of March, 1951, or for any subsequent year. " 609 By this section a clear division was made between the operation of the prior law and the Indian Income tax Act. The assessment for the year, 1951 52, was thus made on the assessee Company under the Indian Income tax Act. Under section 24(2) of the Indian Income tax Act, as it existed prior to its amendment by the Finance Act, 1955, it was provided: "Where any assessee sustains a loss of profits or gains in any year, being a previous year not earlier than the previous year for the assessment for the year ending on the 31st day of March 1940, under the head 'Profits and gains of business, profession or vocation ' and the loss cannot be wholly set off under sub section(1), the portion not so set off shall be carried forward to the following year, and so on, but no loss shall be so carried forward for more than six years, and a loss arising in the previous years for the assessment for "the years ending on the 31st day of March, 1940, the 31st day of March, 1941, the 31st day of March, 1942, the 31st day of March, 1943, and the 31st day of March 1944 respectively shall be carried forward only for one, two, three, four and five years respectively. " Since we are concerned with the loss for the year, which does not correspond to the years named in the latter part of the section above quoted, that part of the section does not apply to the assessee Company 's case. What was thus claimed was the benefit of the earlier part, where the loss was allowed to be carried forward for six years. This position taken by the assessee Company can hardly be considered in view of the provisions of section 32 of the Travancore Act, read with the Removal of Difficulties Order passed in 1950. Section 32 of the Travancore Act was a reproduction of the Indian section 24(2) except for a change of the 610 dates mentioned therein, due obviously to the fact that the Travancore Act came into force on the first day of Chingom, 1122 M. E. (August, 17, 1946). It is enough to point out that instead of "31st March", wherever they occurred, the words "the last day of Karkadakom" (August, 16) were substituted, and instead of the years, 1940, 1941, 1942, 1943 and 1944, were substituted the Malayalam years, 1122 (17 8 1946 to 16 8 1947), 1123 (17 8 1947 to 16 8 1948), 1124 (17 8 1948 to 16 8 1949), 1125 (17 8 1949 to 16 8 1950), and 1126 (17 8 1950 to 16 8 1951). These were the only differences between the two sections, and section 24(2) of the Indian Income tax Act, so modified, can be read as section 32 of the Travancore Act. The existance of these two sections in the two Acts was likely to lead to some difficulty, and a question was likely to arise which law was to prevail. Section 12 of the Indian Finance Act, 1950, therefore, enabled the Central Government to pass an Order removing any such difficulty. The Taxation Laws (Part B States) (Removal of Difficulties) Order, 1950 was thus passed. Paragraph 3 of that order provided: "3. Carry forward and set off of previous losses where in any previous year prior to the previous year for "the assessment for the year ending on the 31st day of March 1950, an assessee has sustained a loss of profits or gains in any business, profession or vocation carried on by him, and such loss would, had the State law continued to be in force, have been set off against the profits and gains, if any, from the same business chargeable to tax in the said year of assessment or in any year subsequent thereto, such loss would be so set off in the same manner, to the same extent, and up to the same year of assessment as it would have been set off had the State law continued to be in force. " 611 The critical words are those contained in the later part, namely, "in the same manner, to the same extent, and up to the same year of assessment, as it would have been set off had the State law continued to be in force". They show that the law to apply to the loss of "any previous year prior to the previous year for the assessment for the year ending on the 31st day of March, 1950" was the law in force in a Part B State here, the Travancore Act. Now, taking the case of the assessee Company, we shall indicate which previous year or years would be governed by the Travancore Act. The previous year of the assessee Company for the assessment year ending 31st day of March 1950 would be the Calendar year, 1 1 1949 to 31 12 1949. To that, the Indian Income tax Act would apply. The application of the Travancore Act by para 3 of the order was limited to the previous year before 1 1 1949 and other earlier previous years. The previous year, with which we are concerned, 1 1 1946 to 31 12 1946, is so clearly a previous year, to which the Travancore Act applies. that it does not admit of any doubt or difference. The matter is thus governed by the Travancore Act. The Travancore Act laid down, inter alia, that a loss arising in the previous year for the assessment for the year ending on the last day of Karkadakom, 1123, could be carried forward for two years. The assessment year for 1123, M.E. covered the period, 17 8 1947 to 16 8 1948, and the previous year of the assessee Company relative to that assessment year was 1 1 1946 to 31 12 1946. The loss of the Calendar year, 1946 could be carried forward to the Calendar years, 1947 and 1948 and given effect to, till the assessment year, 1125 (17 8 1949 to 16 8 1950). The assessment year, 1 4 1951 to 31 3 1952, corresponded to the account year of the assessee Company, 1 1 1950 to 31 12 1950, and that is beyond two years, whether one takes 612 the account year or the assessment year as the basis of the calculation of two years. The High Court, with all due respect, was not right in thinking that the Removal of Difficulties Order, 1950 was meant to enlarge the rights of the new assessees brought within the reach of the Indian Income tax law. The intention of the law was to make a dividing line between those previous years to which the provisions of the earlier law would apply, and those previous years to which the provisions of the Indian Income tax Act would apply. The rights were neither enlarged nor curtailed. As pointed out by Chagla, C.J. in the Indore Malwa United Mills Ltd. vs Commissioner of Income tax (1). "the only right integration has given to an assessee is the right contained in clauses (sic) 3 of the (Removal of Difficulties) Order, 1950 and that right is that if the law of his own State permitted him to carry forward the losses, then that right is preserved under the Indian Income tax Act. " paragraph 3 of the Order clearly said that the right was available in the same manner, to the same extent and up to the year of assessment, as laid down in the State law (here, the Travancore Act). Since in this case, the carry forward of the loss was for only two years and those years were before the previous year from which the Indian Income tax Act began to apply, there is no question of the application of the Indian Income tax Act. The appeal thus succeeds, and is allowed. The assessee Company shall pay the costs of the appeal in the High Court, but there shall be no order about costs in this Court. Appeal allowed.

The respondent company was incorporated in the former State of Travancore. The dispute was about the right of the respondent assessee company to carry forward the loss of the years 1946 under the provisions of the Travancore Act read with section 24 (2) of the Indian Income tax Act and the Taxation laws (Part B States)(Removal of Difficulties) Order, 1950, to the assessment year 1951 52 in the assessment of the company for its year of account. The Income tax Officer held that the loss of the year 1946 could not be carried forward to that year, since it had lapsed after two years under section 32 of the Travancore Act and section 24 (2) was not applicable, in view of para 3 of the order. ^ Held, that the Taxation laws (Part B State) (Removal of Difficulties) Order, 1950, passed under section 12 of the Indian 606 Finance Act, 1950, was not intended to make a dividing line between those previous years to which the provisions of the earlier law would apply, and those previous years to which the provisions of the Income tax Act would apply. The rights were neither enlarged or curtailed by para 3 of the order. That paragraph said that the right was available in the same manner, to the same extent and upto the same year of assessment as laid down in the State law. The law to apply was thus the State law and the carry forward could only be for two years. Indore Malwa United Mills Ltd. vs Commissioner of Income tax, (1959) 35 I. T. R. 271, approved.

iminal Appeal No. 2 of 1958. Appeal from the judgment and order dated July 27, 1957, of the Bombay High Court in Criminal Appeal No. 254 of 1957. WITH Criminal Appeal No. 81 of 1960. Appeal by special leave, from the judgment and order dated July 27, 1957, of the Bombay High Court, in Criminal Appeals Nos. 255 and 257 of 1957. M.H. Chhatrapati, Ravindra Narain, O. C. Mathur and J. B. Dadachanji, for the appellant (in Criminal Appeal No. 2 of 1958). B.K. Khanna and D. Gupta, for the respondent in Criminal Appeal 2 of 1958) and appellant (in Criminal Appeal No. 81 of 1960). 198 Ram Lal Anand and section N. Anand, for respondent No. 1 (in Criminal Appeal No. 81 of 1960). B.S. Gheba, for respondent No. 2 (in Criminal Appeal No. 81 of 1960). April 24. The Judgment of the Court was delivered by SUBBA RAO, J. These two appeals one filed by accused No. 1 by certificate and the other filed by the State of Maharashtra by special leave against the judgment of the High Court of Bombay confirming the conviction and sentence of accused No. 1 and setting aside the convictions and sentences of accused Nos. 2 and 3. The prosecution case may be briefly stated. There was a depot called the Dehu Vehicle Depot in which military stores were kept. In the year 1944 Col. Rao, the Chief Ordnance Officer, was in charge of the Depot; Col. Sindhi, the Station Commandant, and Brig. Wilson, the Brigadier, Ordnance, Southern Command, were his superior officers. Accused No. 1, Major Barsay, was second in command in the Depot and was in charge of stores section; he was subordi nate to Col. Rao. Major Nag, another subordinate to Col. Rao, was in charge of the administration of the Depot. One Capt. Pratap Singh was the Security Officer in the Depot; but, during the period in question, one Lawrence was acting as the Security Officer in place of Capt. Pratap Singh. Kochhar, accused No. 2, who was on leave from October 25, 1954, was recalled to duty by accused No. 1 and was put in charge of kit stores in the Depot. Avatar singh, accused No. 3, who was working in the Unfit Sub Park, was transferred to the Kit Stores by accused No. 1 during the absence on leave of Col. Rao. Accused No. 4, Saighal, was an Ex Col. and was at one time the Station Commandant of the Depot; after retirement he had been staying in a bungalow at a short distance from mile No. 92/7 on the Poona Bombay Road. Accused No. 5, Ramchand Gangwani, was a refugee from Sind and he was running a hotel at Lonnavala. Accused No. 6, Devichand, and one 199 Khemchand, who is absconding, are sons of accused No. 5. Accused Nos. 4 and 5 were friends and they were also partners along with one Bhagwan Parshuram of Bombay in "The Bombay Lonavala Disposal Syndicate". There were large consignments of Kits in Shed No. 48 of Kit Stores which were unitemized and unaccounted for in the books of the Depot. The accused entered into a conspiracy to smuggle out some of the said stores and to make an illegal gain by selling them at Bombay through accused No. 4. The brain behind the conspiracy was accused No. 1. The plan chalked out to implement the object of the conspiracy may be briefly stated. Col. Rao was to proceed on leave sometime in December 1954 and Maj. Barsay, being the next in command, was naturally to succeed him as Chief Ordnance Officer of the Depot during the absence on leave of Col. Rao. The smuggling of the goods out of the Depot was there fore arranged to take place during the period when Maj. Barsay was acting as the Chief Ordnance Officer of the Depot. Col. Rao went on leave from December 11, 1954. Kochhar, the second accused, who was in charge of the Fit Park, proceeded on two months ' leave of absence with effect from October 25, 1954, but he was recalled by accused No. 1 and posted as officer in charge of Kit Stores on November 25, 1954. Accused No. 3, Avatarsingh, was working in the Unfit Sub Park, and he too was shifted from there to the Kit Stores on or about November 22, 1954. These two, postings were made by accused No. 1 without the consent or knowledge of Col. Rao when he had gone to Delhi on some temporary duty for ten days from November 20, 1954 to November 30, 1954. On the night of December 1, 1954, there was a theft of various articles in the Unfit Park of the Depot. Accused No. 1 called in Lawrence, the acting Security Officer, ostensibly to discuss with him certain matters regarding the theft. During the course of the conversation accused No. 1 suggested to Lawrence that valuable stores in Shed No. 48 might be smuggled out and the large amounts expected to be realized from their sale might be shared between the conspirators, including 200 Lawrence. Presumably to put him in a suitable frame of mind to accept the suggestion to become a conspirator, he also hinted to Lawrence that Col. Rao suspected that he (Lawrence) had a hand in the theft. The scheme outlined by accused No. 1 was confirmed by accused No. 2 a few days later. According to the plan chalked out by Maj. Barsay, he was to appoint a board of officers for itemization of "Specialist Boxed Kits" in Shed No. 17 and once the board started functioning there would be shuttle of trucks moving from Shed No. 48 to Shed No. 17 and vice versa and during the movements of those trucks two or three trucks loaded with valuable stores were to be moved out through the main gate of the Depot on the pretext of being back loaded to the Return Stores Sub Depot. He was also to take Col. Rao to Shed No. 48 and explain to him that the boxes contained very few items so that he too, on his return from leave, would not be surprised at the final result of the itemization. It was also agreed that the scheme should be pushed through tentatively on December 16, 17 and 18, 1954. But, for one reason or other, it could not be pushed through during those days, as Capt. Kapoor was frequently visiting the scene of itemization. On December 18, 1954, a meeting took place at Maj. Barsay 's bungalow and accused Nos. 1 to 4 and Lawrence attended that meeting. At that meeting the details of working out the plan to be carried out on December 20, 1954, were finalized. Kochhar reported to the conspirators that he had briefed Jamadar Kundanlal, and Lawrence told them that, as per Kochhar 's suggestion, he had already detailed Jamadar Kundanlal on day duty at the main gate during the next week. Barsay agreed to get a driver of his confidence detailed on one of the trucks to be allotted to the Kit Stores and he offered to give orders to Kochhar on the morning of December 20, 1954, in the presence of all, to transfer the itemized kits to Shed No. 26 ostensibly for the purpose of conditioning and preservation. That would enable accused No. 3, Avatar Singh, to load the stores from Shed No. 17. The first trip was to be of ordinary stores in which the 201 conspirators were not interested and the second trip was to be of valuable stores which were to be smuggled out of the gate. Barsay also undertook to call Maj. Nag to his office on December 20, 1954 and issue orders in the presence of Maj. Nag to Lawrence to go to Dehu Ordnance Depot (D.O.D.) and get the fire hoses which were sent there for repairs. Kochhar agreed to prepare a bogus voucher on Monday (December 20, 1954) morning, and Lawrence undertook to provide a bogus gate pass. Accused No. 4, Saighal, agreed to keep a lorry and some laborers present near his bungalow for transshipping the stores. On the evening of December 19, 1954, Lawrence went to the house of Saighal and the latter showed him the spot where the stores were to be transshipped. Thereafter, after taking his dinner, Lawrence went to the Depot at 9 p.m. The Orderly Officer at the Depot, one Shrinivasan, informed Lawrence that Jamadar Kundanlal, who was to have been on duty at the main gate on December 20, 1954, was sick and had taken 3 days ' leave of absence on medical grounds and that Maj. Barsay had sent a chit to him asking him to send Lawrence to the bungalow of Maj. Barsay. Lawrence went to the bungalow of Maj. Barsay, but could not meet him; and then Lawrence went to the residence of Jamadar Kundanlal and tried to persuade him to attend to his duty at the main gate on December 20, 1954. On December 20, 1954, at about 9.15 a.m. Maj. Barsay called Havaldar Pillay to his office and asked him to allot a new vehicle to the Kit Stores and to detail driver Ramban on that vehicle. Havaldar Pillay did accordingly. At about 10 a.m., Maj. Barsay called Maj. Nag and Lawrence to his office and, in the presence of Maj. Nag, he issued orders to Lawrence to go to Dehu Ordnance Depot (D.O.D.) personally and get the fire hoses. After Maj. Nag left the place, Lawrence told Maj. Barsay that Jamadar Kundanlal had reported himself to be sick and had taken leave of absence and that one Godse was at the main gate. Barsay suggested to Lawrence that 26 202 Jamadar Jogendrasingh may be put at the main gate in place of Godse, and he informed him that he had fixed upon Ramban as the driver of the vehicle in which the stores were to be smuggled out. At about 11 a.m. Lawrence met Maj. Barsay and Kochhar near, Shed No. 48 and was told by Maj. Barsay that the scheme was to proceed according to schedule. Kochhar and Lawrence then went to Shed No. 17 where Avatarsingh, accused No. 3, was present. Kochhar told Avatarsingh that he had not prepared any voucher as it was not necessary. Lawrence had brought an old gate pass with him and he handed over the same to Avatarsingh. Truck No. D. D. 5963 was, in the first instance, loaded with ordinary stores and was sent to Shed No. 26. In the meanwhile, Lawrence went to the Depot and asked Godse to take over at the Unfit Sub Park gate and he ordered Jamadar Jogendrasingh to take over from Godse at the main gate. As Jamadar Jogendrasingh refused to accept the gate pass to be produced by the driver and pass out the vehicle without making an entry regarding the same in the "Vehicles In and Out Register", Lawrence gave him a written order to that effect with instructions not to show or hand over that written order to anybody except himself on his return or to Maj. At about 1 p.m. Maj. Barsay told Lawrence that he had become apprehensive of the scheme succeeding, as he had seen the Station Commandant 's car near the Barrack Office and, therefore, he told him not to take out the vehicle till that car had gone out. Lawrence agreed and went to Shed No. 17 where Avatarsingh was present, and Avatarsingh got the truck loaded and handed over the bogus gate pass and the duty slip of the vehicle to Ramban, and he also asked Lawrence to get into the truck there itself instead of near the main gate as per the plan. After Lawrence got into the truck, it proceeded towards the main gate at about 1.40 p.m. At the main gate, Ramban gave the duty slip of the vehicle and also the bogus gate pass to Jamadar Jogendrasingh and the latter told Lawrence that Maj. Barsay had left a message for him "not to do it on that day". Lawrence, 203 ignoring the said directions, took the vehicle out of the gate. At a spot near Talegaon there was a civilian lorry bearing No. BYL 3289 kept ready by accused Nos. 4, 5 and 6 for transhipping the stores, and to that place the truck was driven. The two lorries were parked back to back, and accused No. 6. and the absconding accused Khemchand and two others started transhipping the stores from the military lorry to the civilian lorry. At that stage, the police officers appeared at the scene and prevented further fulfilment of the plan of the accused. It is a further case of the prosecution that Lawrence ostensibly joined the conspiracy with a view to bring to book the culprits and was informing the superior officers and the police orally and in writing from time to time as and when the important events were taking place. As some argument was made on the basis of the charges, it would be convenient at this stage to read the charges framed by the Special Judge, Poona. The charges are: (1) That you accused No. 1 Major E. G. Barsay, when officiating as Chief Ordnance Officer, D. U. V. and you accused No. 2, H. section Kochhar, when posted as Civilian Group Officer, D. U. V., and you accused No. 3, Avatarsingh Seva Singh, then working as Civilian Stores Keeper, D. U. V., and you accused No. 4, W. section Saighal, released Lt. Col., and you, accused No. 5, Ramchand Pahlajrai Gangawani, and you accused No. 6, Deviprasad Ramchand Gangawani and the absconding accused Khemchand between about October 1954 and December 1954 were parties to a criminal conspiracy at Dehu Road area by agreeing to do certain illegal acts to wit: Firstly, dishonestly or fraudulently misappropriate or otherwise convert to your own use the Military Stores lying in the Vehicle Depot, Dehu Road and which was entrusted or was in charge of Major E. G. Barsay, H. section Kochhar, and Avatarsingh Seva Singh and which was also under their control, as public servants; Secondly, to obtain by corrupt or illegal means for yourselves or for any other persons 204 such stores which amounts to abusing their position as public servants i.e., the co conspirators; Thirdly, to commit illegal acts of committing theft or receiving of stolen property and the above said illegal acts were done in pursuance of the said agreement and that you have thereby committed an offence punishable under Section 120 B of the Indian Penal Code and within my cognizance. (2) That you accused Nos. 1, 2, 3,4, 5, 6 and another (Khemchand Ramchand Gangawani), between about October 1954 and December 1954 in pursuance of the abovesaid conspiracy jointly and in furtherance of the common intention of all of you, you accused No. 1, Major Barsay, Officiating Chief Ord. nance Officer, and you accused No. 2, H. section Kochbar, Civilian Group Officer, D. U. V., and you accused No. 3, Avatarsingh Seva Singh, Civilian Store Keeper, and you accused No. 4, W. section Saighal, released Lt. Col., and you accused No. 5, Ramchand Pahalajrai Gangawani, and you accused No. 6, Deviprasad Ramchand Gangawani, did on 20th of December 1954, dishonestly or fraudulently his. appropriate with a common intention or convert for your own use Government property in the form of Military Stores described in detail in Schedule 'A ' appended herewith, entrusted to or under the control of the first three accused, namely, Major E. G. Barsay, H. section Kochhar and Avatarsingh Seva Singh, who were public servants and thereby committed an offence under Section 5(1)(c), punishable under section 5(2), of the Prevention of Corruption Act, read with Section 34 of the Indian Penal Code and within my cognizance. (3) That you accused Nos. 1, 2,3, 4, 5, 6 and the absconding accused Khemchand Ramchand Gangawani, in pursuance of the abovesaid conspiracy, jointly and in furtherance of the common intention of all of you, did by corrupt or illegal means by abusing their position as public servants, obtained for yourselves or for any other persons, the valuable things in the form of Military Stores detailed out in Schedule 'A ' appended herewith, and this act 205 constitutes an offence under Section 5(1)(d) of the Prevention of Corruption Act, punishable under Section 5(2) of the said Act read with Section 34 of the Indian Penal Code and within my cognizance. (4) That you accused Nos. 1, 2, 3, 4,5, 6, along with the absconding accused, Khemchand Ramchand Gangawani, did on 20th of December 1954, in pursuance of the abovesaid conspiracy jointly and in furtherance of the common intention of all of you, dishonestly or fraudulently remove the Military stores described in detail in Schedule 'A ' appended herewith from the Dehu Road Depot and this act constitutes an offence punishable either under Section 381 or 411 of the Indian Penal Code, read with Section 34 of the Indian Penal Code and within my cognizance. " The main defence of the accused was that, in view of the thefts going on in the Depot, the reputation of Lawrence, the Security Officer, was at the lowest ebb, that in order to resurrect his reputation and to ingratiate himself into the good books of his superiors, he concocted the scheme of huge fraud and implicated therein the accused, including the Acting Chief Ordnance Officer of the Depot. Shortly stated, the defence was that all the accused were innocent and that it was Lawrence that "abducted" the truck with the stores, made false statements to the superior officers from time to time giving concocted versions to fit in with the theory of conspiracy. The Special Judge, on a consideration of the evidence, held that all the charges were made out against the accused. He rejected the technical objections raised in regard to the framing of the charges, the validity of the investigation made by the investigating officer and the sanction given by the Central Government for the prosecution of the accused, and came to the conclusion that prima facie there was no good ground to discard the evidence of Lawrence, but he placed the said evidence in the category of interested evidence and required independent corroboration before acceptance. In the words of the learned Special Judge, "Shri Lawrence 's evidence can, 206 therefore, be accepted and relied upon, only if it is corroborated by other independent evidence and circumstances in the case. " He found ample evidence and circumstances corroborating the evidence of Lawrence. After considering the entire evidence, he came to the following conclusion: "The above discussion of the evidence on record and the circumstances in the case makes it abundantly clear that the prosecution has been able to prove beyond a reasonable doubt that every one of these six accused did commit overt acts in furtherance of the criminal conspiracy alleged against them." He held that accused Nos. 1 to 6 were guilty of the principal offence charged against them and convicted all of them under section 120 B of the Indian Penal Code and section 5(2) of the Prevention of Corruption Act, 1947, read with B. 34 of the Indian Penal Code. He gave varying sentences of imprisonment and fine to the accused. The accused preferred five appeals to the High Court against their convictions and sentences. A division bench of the Bombay High Court which heard the appeals set aside the conviction of accused Nos. 2, 3, 5 and 6, but confirmed those of accused ' Nos. 1 and 4. The High Court also rejected all the technical objections raised at the instance of the appellant accused in regard to some parts of 2nd, 3rd and 4th charges. In regard to the 2nd and 3rd head sub charges, tile High Court accepted the plea that accused Nos. 4, 5 and 6 could not be charged with having committed an offence under section 5(1)(c) and section 5(1)(d) of the Prevention of Corruption Act, as they were not public servants; but they held that it would be proper to frame a charge against them under section 109 of the Indian Penal Code for having abetted the commission of the offence of criminal misconduct under section 5(1)(c) and (d) of the Prevention of Corruption Act, committed by accused Nos. 1 to 3. As the High Court held that they were not prejudiced by the irregularity of the charge, it altered the charge to one under section 109 of the Indian Penal Code, read with section 5(1)(c) and (d) of the Prevention of Corruption Act. As regards the 207 last head of the charge, it held that all the accused could not be charged with having committed an offence under section 381 of the Indian Penal Code and that the charge under section 411 of the Indian Penal Code would also appear to be improper so far as accused Nos. 1 to 3 were concerned; but it held that so far as accused Nos. 4, 5 and 6 were concerned, the charge under section 411, read with section 34, Indian Penal Code, would be quite proper. Before the High Court, learned counsel appearing on behalf of the accused and the special counsel, Mr. Amin, appearing on behalf of the State, asked the Court to proceed to examine the evidence of Lawrence on the basis that he was a decoy and a trap witness. The High Court agreed with the learned Special Judge that the evidence of Lawrence would, have to be treated on par with that of a trap witness and that it would be inadvisable to rely upon the said evidence without independent corroboration. It also pointed out that the corroboration required was not a corroboration of every particular in respect of which the accomplice or the approver gave his evidence, but the corroboration must be such as to make the court believe that the evidence of the accomplice was a truthful one and that it would be safe to act upon that evidence. Finally the High Court premised its discussion of the evidence in the following words: "In our opinion, all these decisions would clearly establish that it would not be safe to rely on the evidence of Lawrence who is admittedly a decoy or trap witness, without his testimony being corroborated from independent sources. " Then the learned Judges of the High Court considered the evidence of Lawrence minutely, discarded some parts of the evidence which were discrepant or inconsistent with other proved facts and accepted the broad story of conspiracy given by him as true to the extent it was corroborated by other unimpeachable pieces of evidence and circumstances. After elaborately considering the evidence of Lawrence, the learned Judges of the High Court came to the following con clusion: 208 "We, therefore, accept Lawrence 's evidence, find that his story is probable and true and we also find that the evidence on the record justified the finding of the trial Court that there was a conspiracy as alleged by the prosecution to smuggle goods out of the Dehu Vehicles Depot." Then the learned Judges considered the question as to which of the accused took part in the conspiracy. As regards accused No. 1, they came to the conclusion that there was cogent evidence to implicate him in the conspiracy, and in that view, they confirmed the finding of the trial court that he was a party to the conspiracy to smuggle military goods out of the Depot. As regards accused No. 2, they held that the evidence was not sufficient to establish that he was a member of the alleged conspiracy and that, as he could not be held to be a member of the conspiracy, he could not also be held to be guilty of committing criminal misconduct under section 5(1)(c) and (d) of the Prevention of Corruption Act, 1947. As regards accused No. 3, they were of the opinion that the case against him was not established beyond reasonable doubt and that he could not be held to be guilty of criminal conspiracy as well as criminal misconduct. As regards accused No. 4, they accepted the finding of the learned Special Judge, as independent acceptable evidence corroborated the evidence of Lawrence in respect of this accused. So far as accused Nos. 5 and 6 were concerned, they found the evidence to be very weak and therefore set aside the convictions and sentences passed against them. In the result, they confirmed the convictions and sentences of accused Nos. 1 and 4, and set aside those of accused Nos. 2, 3, 5 and 6. It appears that accused No. 4 died after the appeal was disposed of by the High Court. Accused No. 1 preferred Criminal Appeal No. 2 of 1958 against his conviction and sentence passed by the High Court and the State preferred Criminal Appeal No. 81 of 1960 challenging the correctness of the order of acquittal made in respect of accused Nos. 2 and 3. We shall first take the appeal filed by accused No. 1. 209 Learned counsel for the appellant raised before us all the technical points which he unsuccessfully raised before the Special Judge as well as before the High Court. At the outset we shall deal with the said contentions before considering the arguments advanced on the merits of the case. The first contention of learned counsel for the appellant is that the Special Judge, Poona, had no jurisdiction to take cognizance of the offences with which the accused were charged and that they should have been tried only by a court martial under the Army Act. The argument of learned counsel for the appellant may be briefly stated thus: The (46 of 1950) created new offences. Section 52 of the said Act created offences with which accused in the present case were charged, and provided a new machinery, namely, a court martial, to try persons committing the said offences. Therefore by necessary implication the trial of the said offences was excluded from the jurisdiction of ordinary criminal courts. This argument was sought to be reinforced by the provisions of section 69 of the whereunder, it was said, by a fiction, offences committed by army personnel which were triable by ordinary courts were to be deemed to be offences committed against the said Act. That difference between offences against the and the offences deemed to be committed against the , the argument proceeded, was an unfailing clue for the true construction of the pro visions of the in that the offences under the first category were exclusively triable by court martial and the offences; of the latter category were subject to concurrent jurisdiction of two courts. The logical conclusion from this premises, it was said, was that the provisions designed to resolve conflict of jurisdiction related only to the second category of offences. Assuming that the said contention was wrong, it was argued, section 126 of the is peremptory in its language, namely, that a criminal court shall not have jurisdiction to try an offence 27 210 defined under the , unless the conditions laid down therein were strictly complied with, that is, unless requisite notice is given to the officer referred to in section 125 of the Act. To appreciate the said argument it is necessary to scrutinize the provisions of the in some detail. Section 2 describes the different categories of army personnel who are subject to the . Section 3(ii) defines "civil offence" to mean "an offence which is triable by a criminal court"; a. 3(vii) defines "court martial" to mean "a court martial held under this Act"; section 3(viii) defines "criminal court" to mean "a court of ordinary criminal justice in any part of India, other than the State of Jammu and Kashmir"; section 3(xvii) defines "offence" to mean "any act or omission punishable under this Act and includes a civil offence"; and section 3(xxv) declares that "all words and expressions used but not defined in this Act and defined in the Indian Penal Code shall be deemed to have the meanings assigned to them in that Code." Chapter VI is comprised of sections 34 to 70. The heading of the Chapter is "Offences". As we have already noticed, the word "offence" is defined to mean not only any act or omission punishable under the , but also a civil offence. Sections 34 to 68 define the offences against the Act triable by court martial and also give the punishments for the said offences. Section 69 says that any person subject to the Act who at any Place in or beyond India commits any civil offence shall be deemed to be guilty of an offence against the Act and, if charged therewith under this section, shall be liable to be tried by a court martial and, on conviction, be punishable as provided for the offence under any law in force in India or such less punishment as is in the Act mentioned. Under section 70, " A person subject to this Act who commits an offence of murder against a person not subject to military, naval or air force law, or of culpable homicide not amounting to murder against such a person or of rape in relation to such a person, shall not be deemed to be guilty of an offence against this Act and shall not be tried by a Court martial. " 211 There are three exceptions to this section with which we are not concerned now. Shortly stated, under this Chapter there are three categories of offences, namely, (1) offences committed by a person subject to the Act triable by a court martial in respect whereof specific punishments have been assigned; (2) civil offences committed by the said person at any place in or beyond India, but deemed to be offences committed under the Act and, if charged under section 69 of the Act, triable by a court martial; and (3) offences of murder and culpable homicide not amounting to murder or rape committed by a person subject to the Act against a person not subject to the military law. Subject to a few exceptions, they are not triable by court martial, but are triable only by ordinary criminal courts. The said categorisation of offences and tribunals necessarily bring about a conflict of jurisdiction. Where an offence is for the first time created by the , such as those created by sections 34, 35, 36, 37 etc., it would be exclusively triable by a courtmartial; but where a civil offence is also an offence under the Act or deemed to be an offence under the Act, both an ordinary criminal court as well as a court martial would have jurisdiction to try the person committing the offence. Such a situation is visualized and provided for by as. 125 and 126 of the Act. Under section 125, "When a criminal court and a court martial have each jurisdiction in respect of an offence, it shall be in the discretion of the officer commanding the army, army corps, division or independent brigade in which the accused person is serving or such other officer as may be prescribed to decide before which court the proceedings shall be instituted, and, if that officer decides that they should be instituted before a court martial, to direct that the accused person shall be detained in military custody." Under a. 126(1) of the Act, "When a criminal court having jurisdiction is of opinion that proceedings shall be instituted before itself in respect of any alleged offence, it may, by written notice, require the officer referred to in 212 section 125 at his option, either to deliver over the offender to the nearest magistrate to be proceeded against according to law, or to postpone proceedings pending a reference to the Central Government. " Clause (2) of that section says that, "In every such case the said officer shall either deliver over the offender in compliance with the requisition, or shall forthwith refer the question as to the court before which the proceedings are to be instituted for the determination of the Central Government, whose order upon such reference shall be final. " Section 125 presupposes that in respect of an offence both a criminal court as well as a court martial have each concurrent jurisdiction. Such a situation can arise in a case of an act or omission punishable both under the . as well as under any law in force in India. It may also arise in the case of an offence deemed to be an offence under the Act. Under the scheme of the said two provisions, in the first instance,, it is left to the discretion of the officer mentioned in section 125 to decide before which court the proceedings shall be instituted, and, if the officer decides that they should be instituted before a court martial, the accused person is to be detained in military custody; but if a criminal court is of opinion that the said offence shall be tried before itself, he may issue the requisite notice under section 126 either to deliver over the offender to the nearest magistrate or to postpone the proceedings pending a reference to the Central Government. On receipt of the said requisition, the officer may either deliver over the offender to the said court or refer the question of proper court for the determination of the Central Government whose order shall be final. These two sections provide a satisfactory machinery to resolve the conflict of jurisdiction, having regard to the exigencies of the situation. What is more, section 127 of the provides for successive trials by court martial and by criminal court in respect of the same offence. Under sub section (1) of that section, "A person convicted or acquitted by a 213 court martial may, with the previous sanction of the Central Government, be tried again by a criminal court for the same offence, or on the same facts." But sub section (2) thereof imposes a limitation in the matters of punishment; for, under that sub section, the criminal court shall, in awarding punishment, have regard to the punishment the offender may already have undergone for the said offence. The scheme of the Act, therefore, is self evident. It applies to offences committed by army personnel described in section 2 of the Act; it creates new offences with specified punishments, imposes higher punishments to pre existing offences, and enables civil offences by a fiction to be treated as offences under the Act; it provides a satisfactory machinery for resolving the conflict of jurisdiction. Further it enables, subject to certain conditions, an accused to be tried successively both by court martial and by a criminal court. It does not expressly bar the jurisdiction of criminal courts in respect of acts or omissions punishable under the Act, if they are also punishable under any other law in force in India; nor is it possible to infer any prohibition by necessary implication. Sections 125, 126 and 127 exclude any such inference, for they in express terms provide not only for resolving conflict of jurisdiction between a criminal court and a court martial in respect of a same offence, but also provide for successive trials of an accused in respect of the same offence. Now let us apply this legal position to the facts of the case. Under section 52 of the Act, any person subject to the Act who commits theft of any property belonging to Government or to any military, naval or air force mess, band or institution, or to any person subject to military, naval or air force law, or dishonestly misappropriates or converts to his own use any such property, or commits criminal breach of trust in respect of any such property, or does any other thing with intent to defraud, or to cause wrongful gain to one person or wrongful loss to another person shall, on conviction by court martial, be liable to suffer im prisonment for a term which may extend to ten years 214 or such less punishment as is in the act mentioned. Section 2 (xxv) says that all words and expressions used but not defined in the and defined in the Indian Penal Code shall be deemed to have the meanings assigned to them in that Code. The section does not create new offences, but prescribes higher punishments if the said offences are tried by a court martial. The appellant and the other accused were charged in the present case, among others, for having been parties to a criminal conspiracy to dishonestly or fraudulently misappropriate or otherwise convert to their own use the military stores and also for dishonestly or fraudulently misappropriating the same. The said acts constitute offences under the Indian Penal Code and under the Prevention of Corruption Act. They are also offences under section 52 of the . Though the offence of conspiracy does not fall under section 52 of the Act, it, being a civil offence, shall be deemed to be an offence against the Act by the. force of section 69 of the Act. With the result that the offences are triable both by an ordinary criminal court having jurisdiction to try the said offences and a court martial. To such a situation sections 125 and 126 are clearly intended to apply. But the designated officer in section 125 has not chosen to exercise his discretion to decide before which court the proceedings shall be instituted. As he has not exercised the discretion, there is no occasion for the criminal court to invoke the provisions of section 126 of the Act, for the second part of section 126(1), which enables the criminal court to issue a notice to the officer designated in section 125 of the Act to deliver over the offender to the nearest magistrate or to postpone the proceedings pending a reference to the Central Government, indicates that the said subsection presuppose,% that the designated officer has decided that the proceedings shall be instituted before a court martial and directed that the accused person shall be detained in military custody. If no such decision was arrived at, the could not obviously be in the way of a criminal court exercising its ordinary jurisdiction in the manner provided by law. 215 The correct approach to the problem may be stated thus: The appellant and the other accused have committed offences under the Indian Penal Code and the Prevention of Corruption Act. By reason of section 7 of the Criminal Law (Amendment) Act, 1952, the said offences are triable by a special judge appointed under that Act. The special judge so appointed would have jurisdiction to try the said offences unless the expressly, or by necessary implication, excluded the offences alleged to have been committed by the appellant and others from the jurisdiction of that court. The aforesaid discussion of the provisions of the indicates that there is not only no such exclusion but also that there is clear and unambiguous indication to the contrary. An argument advanced by learned counsel for the appellant in this context may conveniently be noticed at this stage. The second branch of the argument of learned counsel for the appellant under this head is based upon section 549 of the Code of Criminal Procedure. Under that section, "The Central Government may make rules, consistent with this Code and the . . . as to the cases in which persons subject to military, naval or air force law shall be tried by a court to which this Code applies, or by Court martial . . . . The Central Government made rules in exercise of the power conferred on it under this section. No rule was made prescribing that the offences with which we are now concerned shall be tried only by a court martial. But reliance is made on r. 3 which reads: "Where a person subject to military, naval or air force law is brought before a Magistrate and charged with an offence for which he is liable to be tried by a Court martial, such Magistrate shall not proceed to try such person or to inquire with a view to his commitment for trial by the Court of Sessions or the High Court for any offence triable by such Court, unless, (a) he is of opinion, for reasons to be recorded, that he should so proceed without being moved thereto by competent military, naval or air force authority; or 216 (b) he is moved thereto by such authority. " This rule obviously cannot apply unless the Special Judge constituted under the Criminal Law (Amendment) Act, 1952, is a magistrate within the meaning of that rule. A special judge is appointed under section 6(1) of the Criminal Law (Amendment) Act to try the offences specified therein. Section 6(2), of that Act lays down that "A person shall not be qualified for appointment as a special judge under this Act unless he is, or has been, a sessions Judge or an additional sessions Judge or an assistant sessions Judge under the Code of Criminal Procedure, 1898 (V of 1898). " Section 8(1) of the said Act says, "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 (Act V of 1898), for the trial of warrant cases by magistrates. " Under sub section (3) thereof, "Save as provided in sub section (1) or sub section (2), 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 purpose 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 and the person conducting a prosecution before a special judge shall be deemed to be a public prosecutor. " Under section 9 of the said Act, "The High Court may exercise, so far as they may be applicable, all the powers conferred by Chapters XXXI and XXXII of the Code of Crimi nal Procedure, 1898 (Act V of 1898), on a High Court as if the Court of a Special Judge were a Court of session trying cases without a jury within the local limits of the jurisdiction of the High Court." These provisions equate a special judge with a sessions judge, and the provisions of the Code of Criminal Procedure applicable to a sessions judge, in so far as they are not inconsistent with the Act, are made 217 applicable to a special judge. But it is said that section 8(1) of the Act puts him on par with a magistrate and therefore r. (3) of the rules framed under section 549 which applies to a magistrate equally applies to a special judge. This argument overlooks the limited purpose for which section 8(1) is enacted. Section 8 of the Criminal Law (Amendment) Act makes a distinction between the power of a special judge to take cognizance of an offence and the procedure to be followed by him in trying the case. In trying accused persons, he is enjoined to follow the procedure prescribed by the Code of Criminal Procedure for the trial of warrant cases by magistrates. The warrant procedure is incorporated in the Act by reference to the Code of Criminal Procedure. Chapter XXI of the Code of Criminal Procedure provides the procedure for the trial of warrant cases; and section 549 is not one of the sections in that Chapter. Nor does it empower the Central Government to make rules modifying the warrant procedure. That apart, can it be said that, by reason of the procedure to be followed by the special judge, he would be a magistrate empowered to try such a person within the meaning of r. (3)? Section 8(1) of the Criminal Law (Amendment) Act maintains a clear distinction between jurisdiction and the procedure. It is, therefore, not possible to hold that a special judge is a magistrate within the meaning of r. (3). If so, it follows that r. (3) has no application to the trial of an army personnel by a special judge. There is a more formidable obstacle in the way of learned counsel 's argument. Section 7 of the Criminal Law (Amendment) Act, 1952, reads: "Notwithstanding anything contained in the Code of Criminal Procedure, 1898 (Act V of 1898) or in any other law the offences specified in subsection (1) of section 6 shall be triable by special Judges only. " Doubtless the is comprehended by the words "any other law". The offences with which we are now concerned are certainly offences specified in sub section (1) of section 6 of the Criminal Law (Amendment) Act. The non obstante clause in section 7 clearly confers 218 jurisdiction to try persons committing the said offences on a special judge. But it is contended that the is a special Act and therefore section 7 found in the general Act cannot take away the jurisdiction conferred on a court martial in respect of the said offences. That proposition of law may have some bearing when there is conflict of jurisdiction arising out of a general Act and a special Act, without any specific exclusion of the jurisdiction in the general Act of that conferred under the special Act. But that principle may not have any relevance to a case where the general Act in express terms confers jurisdiction on a particular tribunal in respect of specified offences to the exclusion of anything contained in any other law. In such a situation, the intention of the Legislature is clear and unambiguous, and no question of applying any rule of interpretation would arise, for the rules of interpretation are evolved only to ascertain the intention of the Legislature. It is contended that section 7 confers an exclusive jurisdiction on a special judge only in regard to offences specified in sub section (1) of section 6 and that the said subsection does not comprise offences under section 52 of the . There is a fallacy underlying this argument. Certain acts committed or omissions made by a person constitute offences under section 6(1) of the Criminal Law (Amendment) Act, 1952. Under section 7 of the said Act, the said offences are exclusively triable by a special judge. In the present case the accused were charged with having committed offences expressly falling under B. 6 of the said Act and, therefore, the special judge had clearly jurisdiction to try the accused in respect of the said offences. The mere fact that the said acts or omissions might also constitute an offence under section 52 of the would not be of any relevance, as jurisdiction was exclusively conferred on the special judge notwithstanding anything contained in any other law. If that be so, the special judge had exclusive jurisdiction to try offences covered by section 6 of the Criminal Law (Amendment) Act, 1952. At this stage, another argument of learned counsel may be adverted to. He says that some of the offences with which the accused are charged in the present 219 case are not those enumerated in section 6 of the Criminal Law (Amendment) Act, 1952. This objection is clearly answered by section 7(b) of the said Act which says, "When trying any case, a special judge may also try any offence other than an offence specified in section 6 with which the accused may, under the Code of Criminal Procedure, 1898, be charged at the same trial. " It is then argued that the prosecution has failed to establish that the Central Government accorded sanction to prosecute the appellant under section 6(1) of the Prevention of Corruption Act. Under section 6(1)(a) of the Prevention of Corruption Act, "No Court shall take cognizance of an offence punishable under section 161 or section 164 or section 165 of the Indian Penal Code, or under subsection (2) of section 5 of this Act, alleged to have been commuted by a public servant, except with the previous sanction (a) in the case of a person who is employed in connection with the affairs of the Union and is not removable from his office save by or with the sanction of the Central Government, of the Central Government. . It is common case that the appellant was a public servant within the meaning of the said sub section and, therefore, he cannot be prosecuted without the sanction of the Central. Government. The sanction given in this case for the prosecution of the appellant reads thus: " . . . . NOW, THEREFORE, THE CENTRAL GOVERNMENT doth hereby accord sanction under section 197 of the Criminal Procedure Code (Act V of 1898) and section 6(1)(a) of the Prevention of Corruption Act, 1947 (II of 1947) to the initiation of proceedings to prosecute in a Court of competent jurisdiction the said Major E. G. Barsay and Shri H. section Kochhar in respect of the aforesaid offences and other cognate offences punishable under other provisions of law. M. Gopala Menon, Deputy Secretary to the Govt. of India. " 220 Ex facie the said order giving the requisite sanction purports to have been issued in the name of the Central Government and is signed by the Deputy Secretary to the Government of India in the Ministry of Home Affairs. P.W. 36, Dharambir, an Assistant in the Minstry of Home Affairs, New Delhi, has given evidence in respect of this document. He says that the papers relating to the present case were submitted to the Home Ministry by the Inspector General of Police, Special Police Establishment, New Delhi, for obtaining the necessary sanction, that the papers were put up before the Deputy Secretary in that Ministry, that the Deputy Secretary was competent to accord sanction on behalf of the President, and that he gave the said sanction under his signature. In the cross examination, this witness says that he cannot say whether the Deputy Secretary 's signature was in his own right or by way of authentication of the President 's order. This uncontradicted evidence clearly established that the Deputy Secretary was competent to accord sanction on behalf of the President and that he gave the sanction in exercise of the power conferred on him, presumably, under the rules framed by the President in this behalf The statement made by this witness in the cross examination is not inconsistent with that made by him in the examination in chief. The Deputy Secretary may have power to make some orders in his own right and also may have power to authenticate other orders issued in the name of the President. But in this case, this witness has clearly deposed that the Deputy Secretary had power to accord sanction in his own right and when the order giving the sanction ex facie shows that he did not authenticate it by order of the President, we must hold that he gave the sanction in his own right. In this context, an argument based upon article 77 of the Constitution may be noticed. Under el. (1) of article 77, all executive actions of the Government of India shall be expressed to be taken in the name of the President; and under cl. (2) thereof, orders and other instruments made and executed in the name of the President shall be authenticated in 221 such manner as may be specified in rules to be made by the President, and the validity of an order or instrument which is so authenticated shall not be called in question on the ground that it is not an order or instrument made or executed by the President. Under the General Clauses Act, the expression "President" means the Central Government. It is, therefore, argued that as the order issuing the sanction was not expressed to be made in the name of the President, the sanction was void. This Article and the corresponding Article viz., article 166, were subject to judicial scrutiny by this Court. The validity of an order of detention made by the Bombay Government under section 3 of the , was considered in The State of Bombay vs Puru shottam Jog Naik (1). There, in the body of the order the "satisfaction" was shown to be that of the Government of Bombay; at the bottom of the order the Secretary to the Government of Bombay, Home Department, signed it under the words "By order of the Governor of Bombay". It was contended that the order was defective as it was not expressed to be in the name of the Governor within the meaning of article 166(1) of the Constitution and accordingly was not protected by cl. (2) of the said Article. Adverting to this contention, Bose, J., speaking for the Court, said at p. 678: "In our opinion, the Constitution does not require a magic incantation which can only be expressed in a set formula of words. What we have to see is whether the substance of the requirements is there. " This judgment lays down that we must look at the substance of the order. On a construction of the order that was in question in that case, having regard to the definition of "State Government" in the General Clauses Act and the concluding words "By order of the Governor of Bombay", the Court came to the conclusion that the order was expressed to have been taken in the name of the Governor. In Dattatreya Moreshwar Pangarkar vs The State of Bombay (2), an (1) ; (2) ; 222 order made under the , was questioned on the ground that it did not comply with the provisions of article 166(1) of the Constitution. There the order was made in the name of the Government and was signed by one Kharkar for the Secretary to the Government of Bombay, Home Department. Das, J., as he then was, after referring to the decision of the Federal Court in J. K. Gas Plant Manufacturing Co., (Rampur) Ltd. vs The King Emperor (1) observed at p. 625 thus: "Strict compliance with the requirements of article 166 gives an immunity to the order in that it cannot be challenged on the ground that it is not an order made by the Governor. If, therefore, the requirements of that article are not complied with, the resulting immunity cannot be claimed by the State. This, however, does not vitiate the order it self. " The learned Judge came to the above conclusion on the ground that the provisions of the said article are only directory and not mandatory. This decision was followed by this Court in P. Joseph John vs The State of Travancore Cochin (2). There the "show cause notice" issued under article 311 of the Constitution was impugned on the ground that it was contrary to the provisions of article 166 thereof. The notice was issued on behalf of the Government and was signed by the Chief Secretary to the Government, who had under the rules of business framed by the Rajpramukh the charge of the portfolio of "service and appointments" at the Secretariat level in the State. This Court held that the said notice was issued in substantial compliance with the directory provisions of article 166 of the Constitution. The latest decision on the point is that in Ghaio Mall & Sons vs The State of Delhi(1). There the question was whether the com munication issued by the Under Secretary, Finance, Government of Delhi State, had complied with the provisions of article 166 of the Constitution. This Court held that it did not comply with the provisions of (1) (2) 223 article 166 of the Constitution and also found that the said order was not, as a matter of fact, made by the Chief Commissioner. When the decision in Dattatreya Moreshwar Pangarkar 's case (1) was cited this Court observed at p. 1439 thus: "In that case there was ample evidence on the record to prove that a decision had in fact been taken by the appropriate authority and the infirmity in the form of the authentication did not vitiate the order but only meant that the presumption could not be availed of by the State. " The foregoing decisions authoritatively settled the true interpretation of the provisions of article 166 of the Constitution. Shortly stated, the legal position is this: article 166(1) is only directory. Though an impugned order was not issued in strict compliance with the provisions of article 166(1), it can be established by evidence aliunde that the order was made by the appropriate authority. If an order is issued in the name of the Governor and is duly authenticated in the manner prescribed in r. (2) of the said Article, there is an irrebuttable presumption that the order or instrument is made or executed by the Governor. Any non compliance with the provisions of the said rule does not invalidate the order, but it precludes the drawing of any such irrebuttable presumption. This does not prevent any party from proving by other evidence that as a matter of fact the order has been made by the appropriate authority. Article 77 which relates to conduct of business of the Government of India is couched in terms similar to those in article 166 and the same principles must govern the interpretation of that provision. If that be the legal position, in the instant case the impugned order does not comply with the provisions of article 77(2) of the Constitution and, therefore, it is open to the appellant to question the validity of the order on the ground that it was not an order made by the President and to prove that it was not made by the Central Government. But this legal position does (1) ; 224 not help the appellant, for as we have pointed out, the uncontroverted evidence of P. W. 36, an Assistant in the Home Ministry, which was accepted by the High Court and the Special Judge, establishes that the order was made by the Deputy Secretary on behalf of the Central Government in exercise of the power conferred on him under the rules delegating such power to him. The next contention challenges the legal competence of Jog, an Inspector of Police in the Delhi Special Police Establishment, to make the investigation. In his evidence Jog stated that the Inspector General of Police, Special Police Establishment, New Delhi, empowered him under section 5A of the Prevention of Corruption Act to investigate the offences mentioned therein without the sanction of any magistrate. The question is whether he can make an investigation in regard to the offences alleged to have been committed by the accused in the present case. Section 5A of the Prevention of Corruption Act, 1950, on which reliance is placed reads: "Notwithstanding anything contained in the Code of Criminal Procedure., 1898, no police officer below the rank (a) in the presidency towns of Madras and Calcutta, of an assistant commissioner of police, (b)in the presidency town of Bombay, of a superintendent of police, and (c) elsewhere, of a deputy superintendent of police, shall investigate any offence punishable under section 161, section 165 or section 165A of the Indian Penal Code or under sub section (2) of section 5 of this Act, without the order of a presidency magistrate or a magistrate of the first class, as the case may be, or make any arrest therefor without a warrant: Provided that a police officer of the Delhi Special Police Establishment, not below the rank of an Inspector of police, who is specially authorized by the Inspector General of Police of that Establishment may, if he has reasons to believe that, on account of the delay involved in obtaining the order 225 of a magistrate of the first class, any valuable evidence relating to such offence is likely to be destroyed or concealed, investigate the offence without such order; but in every case where he makes such investigation, the police officer shall, as soon as may be, send a report of the same to a magistrate of the first class, together with the circumstances in which the investigation was made. " The proviso governs the present case. Jog, who was specially authorized by the Inspector General of Police under section 5A of the Prevention of Corruption Act to investigate the offences mentioned therein being an Inspector of Police, was certainly empowered to make an investigation within the meaning of that proviso. But what is contended is that the power to investigate under that proviso is hedged in by two conditions, namely, that the said officer should have reasons to believe that on account of delay involved in obtaining the order of a magistrate of the first class, any valuable evidence relating to such offence is likely to be destroyed or concealed, and subsequently he should have sent a report of the same to a magistrate of the first class together with the circumstances in which the investigation was made. The High Court on a consideration of the evidence found that the said two conditions have not been complied with by Jog. On that finding, the question arises whether the trial of the accused by the Special Judge was vitiated by the non compliance with the aforesaid two conditions. This Court in H. N. Rishbud & Inder Singh vs The State of Delhi (1) held that section 5(4) and proviso to section 3 of the Prevention of Corruption Act, 1947, and the corresponding section 5A of the Prevention of Corruption (Second Amendment) Act, 1952 (LIX of 1952) are mandatory and not directory and that an investigation conducted in violation thereof is illegal. In the same decision this Court also pointed out that the illegality committed in the course of investigation did not affect the competence and jurisdiction of the court for trial and where cognizance of the case had in fact (1) ; 29 226 been taken and the case had proceeded to termination the validity of the preceding investigation did not vitiate the result unless miscarriage of justice of been caused thereby. The question is whether in the present case the investigation made by the Inspector duly authorized by the Inspector General of Police to investigate under section 5A of the Prevention of Corruption Act, without complying with the two conditions laid down in the proviso to that section, had caused any prejudice to the accused. The High Court, after considering the entire evidence, found that the alleged irregularity would not justify the conclusion that the non observance of the conditions prescribed in the proviso to section 5A of the Prevention of Corruption Act had occasioned any failure of justice. Learned counsel has taken us through different steps in the investigation made by the said officer, and we have no reason to differ from the conclusion arrived at by the High Court. The validity of the investigation made by Jog was questioned yet on another ground. It was said that he had not obtained the requisite permission of the State Government under section 6 of the , before he started the investigation. Section 5 of that Act authorizes the Central Government to extend to any area the powers and jurisdiction of members of the Delhi Special Police Establishment for the investigation of any offences or classes of offences specified in a notification under section 3 thereof. But section 6 of that Act says that nothing contained in section 5 shall be deemed to enable any member of the Delhi Special Police Establishment to exercise powers and jurisdiction in any area in a State, not being a Union Territory or railways area, without the consent of the Government of that State. The Government of Bombay, Home Department, addressed a letter to the Government of India, dated August 13,1949 and it was stated therein, ". .I am directed to state that this Government re affirms, with reference to section 6 of the , the consent given for an indefinite period under its letter 227 No. 5042/4 D, dated the 6th November 1946, to the members of the Delhi Special Police Establishment exercising powers and jurisdiction in the area of the not province of Bombay. " It was contended before the High Court and it was repeated before us that the consent should have been given to every individual member of the Special Police Establishment and that a general consent would not be a good consent. We do not see any force in this argument. Under a. 6 of the , no member of the said Establishment can exercise powers and jurisdiction in any area in a State without the consent of the Government of that State. That section does not lay down that every member of the said Establishment should be specifically authorized to exercise jurisdiction in that area, though the State Government can do so. When a State Government can authorize a single officer to exercise the said jurisdiction, we do not see any legal objection why it could not authorize the entire force operating in that area belonging to that Establishment to make such investigation. The authorization filed in this case sufficiently complies with the provisions of section 6 of the , and there are no merits in this contention. The next contention centres round the framing of charges. The charges framed in this case have been fully extracted in the earlier part of the judgment. The first objection is that the Special Judge had no jurisdiction to try the accused on charges involving offences other than those mentioned in section 6(1) of the Criminal Law (Amendment) Act, 1952. This argument ignores section 7(2)(b) of the Act which says, "When trying any case, a special judge may also try any offence other than an offence specified in section 6 with which the accused may, under the Code of Criminal Procedure, 1898, be charged at the same trial. " The objection, therefore, has no force. The next criticism is that there can be no legal charge of a conspiracy between accused Nos. 1 to 3, who are public servants, and accused Nos. 4 to 6, who are not public servants, in respect of offences under 228 the Prevention of Corruption Act for the reason that they can only be committed by public servants. But this contention ignores the scope of the offence of criminal conspiracy. Section 120A of the Indian Penal Code defines "criminal conspiracy" and under that definition, "When two or more persons agree to do, or cause to be done, an illegal act, or an act which is not illegal by illegal means, such an agreement is designated a criminal conspiracy. " The gist of the offence is an agreement to break the law. The parties to such an agreement will be guilty of criminal con spiracy, though the illegal act agreed to be done has not been done. So too, it is not an ingredient of the offence that all the parties should agree to do a single illegal act. It may comprise the commission of a number of acts. Under section 43 of the Indian Penal Code, an act would be illegal if it is an offence or if it is prohibited by law. Under the first charge the accused are charged with having conspired to do three categories of illegal acts, and the mere fact that all of them could not be convicted separately in respect of each of the offences has no relevancy in considering the question whether the offence of conspiracy has been committed. They are all guilty of the offence of conspiracy to do illegal acts, though for individual offences all of them may not be liable. The second objection is in regard to the second charge. It is said that accused Nos. 4, 5 and 6 could not be charged with having committed an offence under section 5(1)(c) and 5(1)(d) of the Prevention of Corruption Act, as they are not public servants. The learned Judges of the High Court accepted the said legal position as correct, but held that they could be convicted under section 109 of the Indian Penal Code, read with cls. (c) and (d) of section 5(1) of the Prevention of Corruption Act. But on the merits they convicted accused No. 1 under section 5(2) of the Prevention of Corruption Act, instead of under the said section read with section 34 of the Indian Penal Code, and they convicted accused No. 4 under section 109 of the Indian Penal Code, read with section 5(1)(c) and (d) of the Prevention of Corruption Act, instead of under section 5(2) of the said 229 Act, read with section 34 of the Indian Penal Code. As accused No. 4 was dead before the appeal was filed in this Court, nothing need be said about the legality of his conviction. The only outstanding question, therefore, is whether the High Court was justified in convicting accused No. 1 under section 5(2) of the Prevention of Corruption Act instead of under the said section read with section 34 of the Indian Penal Code. To such a situation, section 537 of the Criminal Procedure Code applies and under that section, no sentence passed by a court of competent jurisdiction shall be reversed or altered on appeal or revision on account of an error, omission or irregularity in the charge, including any misjoinder of charges, unless such error, omission, irregularity or misdirection has in fact occasioned a failure of justice. This Court in W. Slaney vs State of M. P. (1) held that in adjudging a question of prejudice the concern of the court should be to see whether the accused had a fair trial, whether he knew what he was being tried for, whether the im pugned facts sought to be established against him were explained to him clearly and fairly and whether he was given a full and fair chance to defend himself. Judged by the said test it is manifest that accused No. I cannot be said to have been prejudiced by his conviction under section 5(2) of the Prevention of Corruption Act, for accused No. I had clear knowledge from the inception that the prosecution case against him was that he committed an offence under section 5(2) of the Prevention of Corruption Act and that he had every opportunity, and indeed he made a sustained effort throughout the trial to defend himself against the said accusation. It is not possible to hold in this case that there was any failure of justice by reason of the High Court convicting him for a substantive offence under section 5(2) of the said Act. So far as the third head of the charge is concerned, the High Court held that it was bad in regard to accused No. 1. Accused No. 1, therefore, cannot obviously have any grievance with that finding. For the foregoing reasons, we hold that there are no merits (1)[1955] 2 S.C.R. 1140. 230 in the contentions raised by learned counsel on the basis of the charges framed in this case. Now we come to the merits of the case. So far as the appellant is concerned, both the Special Judge and, on appeal the High Court accepted the evidence of Lawrence, as it was corroborated in material particulars by other acceptable evidence. They concurrently found that the appellant was a party to the conspiracy. The finding is one of fact, and the practice of this Court is not to interfere with such finding except under exceptional circumstances. Learned counsel for the appellant made a serious and sustained attempt to have the said finding reopened by advancing arguments under the following three heads: (1) The High Court has failed to draw correct inferences from the facts found by it and has also drawn wrong conclusion ignoring probabilities arising in a given situation; (2) the High Court has ignored the distinction between an untruthful witness and a truthful witness, whose evidence under the rule of prudence could be accepted only in so far as it is corroborated in material particulars, and the High Court, having disbelieved Lawrence 's evidence in regard to important incidents in his narration, should have rejected his evidence in toto; and if it had done so, the question of corroboration would not arise for consideration; and (3) the independent pieces of evidence accepted by the High Court did not corroborate the evidence of Lawrence in material particulars implicating him in the crime. The first argument is a direct attack on the correctness of the finding of fact arrived at by the High Court. As we have said, the practice of this Court in an appeal under article 136 of the Constitution is not to allow such an attack except in exceptional circumstances. Learned counsel addressed at some length on this aspect of the case, and after hearing him, we were satisfied that there were no such exceptional circumstances present in this case. Our reluctance to depart from the usual practice is hightened by the fact that in the present case, so far as the appellant is concerned, there are concurrent findings of fact by both the courts. 231 The second argument is a subtle attempt to reopen the findings of fact from a different perspective. This argument is based upon a decision of this Court in Sarwan Singh vs The State of Punjab (1). In that case, Gajendragadkar, J., speaking for the Court, observed at p. 959 thus: "But it must never be forgotten that before the Court reaches the stage of considering the question of corroboration and its adequacy or otherwise, the first initial and essential question to consider is whether even as an accomplice the approver is a reliable witness. If the answer to this question is against the approver then there is an end of the matter, and no question as to whether his evidence is corroborated or not falls to be considered. In other words, the appreciation of an approver 's evidence has to satisfy a double test." Then the learned Judge proceeded to state, "We have carefully read the judgment delivered by the High Court but we find no indication in the whole of the judgment that the learned Judges considered the character of the approver 's evidence and reached the conclusion that it was the evidence given by a reliable witness." Later on the learned Judge further stated, ". . the evidence of the approver is so thoroughly discrepant that it would be difficult to resist the conclusion that the approver in the present case is a wholly unreliable witness. " Relying upon these observations, learned counsel contends that in the present case the High Court did not accept the evidence of the approver in regard to important events and therefore the High Court should have rejected his evidence without further attempting to see whether there was any corroboration in material particulars in other evidence. Before we consider this argument in the context of the facts of the present case, we would like at the outset to make some general observations. This Court could not have intended to lay down that the evidence (1) ; 232 of an approver and the corroborating pieces of evidence should be treated in two different compartments, that is to say, the Court shall have first to consider the evidence of the approver dehors the corroborated pieces of evidence and reject it if it comes to the conclusion that his evidence is unreliable; but if it comes to the conclusion that it is reliable then it will have to consider whether that evidence is corroborated by any other evidence. This Court did not lay down any such proposition. In that case it happened that the evidence of the approver was so thoroughly discrepant that the Court thought that he was a wholly unreliable witness. But in most of the cases the said two aspects would be so interconnected that it would not be possible to give a separate treatment, for as often as not the reliability of an approver 's evidence, though not exclusively, would mostly depend upon the corroborative support it derives from other unimpeachable pieces of evidence. We must also make it clear that we are not equating the evidence of Lawrence with that of an approver; nor did the Special Judge or the High Court put him exactly on that footing. The learned Special Judge in his judgment observed thus: "He (Lawrence) is obviously decoy or spy and agent provocateur and his evidence will have, therefore, to be approached with great caution and much weight cannot be attached to it unless it is corroborated by other independent evidence and circumstances in the case. . . . Not being tainted evidence, it would not suffer from a disability of being unworthy of acceptance without independent corroboration. But being interested evidence, caution requires that there should be corroboration from an independent source before its acceptance. To convict an accused on the tainted evidence of an accomplice is not illegal but it is imprudent; to convict an accused upon the partisan evidence of a person at whose instance a trap is laid by the police is neither illegal nor imprudent but inadvisable therefore, be accepted and relied upon, only if it is corroborated by other independent evidence and circumstances in the case. " 233 The learned Judges of the High Court practically adopted the same attitude in the manner of their approach to the evidence of Lawrence. The learned Judges observed: "To convict an accused upon the partisan evidence of a person at whose instance a trap is laid by the police is neither illegal nor imprudent, because it is just possible that in some cases an accomplice may give evidence because he may have a feeling in his own mind that it is a condition of his pardon to give that evidence, but no such consideration obtains in the case of the evidence of a person who is not a guilty associate in crime but who invites the police to lay a trap. All the same, as the person who lodges information with the police for the purpose of laying a trap for another is a partisan witness interested in seeing that the trap succeeds, it would be necessary and advisable to look for corroboration to his evidence before accepting it. But the degree of corroboration in the case of a tainted evidence of an accomplice would be higher than that in the case of a partisan witness. In our opinion, all these decisions would clearly establish that it would not be safe to rely on the evidence of Lawrence who is admittedly a decoy or trap witness, without his testimony being corroborated from independent sources." Even Mr. Amin, learned special counsel on behalf of the State asked the courts to proced to examine the evidence of Lawrence on the basis that he was a decoy or trap witness. We are definitely of opinion that both the courts had approached the evidence of Lawrence from a correct standpoint. Though Lawrence was not an approver, he was certainly an interested witness in the sense that he was interested to see that the trap laid by him succeeded. He could at least be equated with a partisan witness and it would not be admissible to rely upon such evidence without corroboration. It would be equally clear that his evidence was not a tainted one, but it would only make a difference in the 30 234 degree of corroboration required rather than the necessity for it. Approaching the case from this perspective in our view that is a correct one the learned Special Judge came to the following conclusion: "There was no compelling necessity for Shri Lawrence to concoct a false story against Major Barsay and the other accused. It is, therefore, clear that prima facie there is no good ground to discard the evidence of Shri Lawrence." Then the learned Special Judge considered the corroborative pieces of evidence and finally held that Lawrence 's evidence had been corroborated in material particulars in respect of the appellant. Likewise, the learned Judges of the High Court considered the evidence of Lawrence along with that of other acceptable witnesses. Though the learned Judges of the High Court rejected the evidence of Lawrence in regard to some events either because that part of the evidence was not consistent with the other parts of his evidence or with the evidence of some disinterested witnesses, they did not see any reason to reject the story given by Lawrence as a myth or a concoction. After considering the evidence, the learned Judges concluded, "We, therefore, accept Lawrence 's evidence, find that his story is probable and true and we also find that the evidence on the record justifies the finding of the trial Court that there was a conspiracy as alleged by the prosecution to smuggle goods out of the Dehu Vehicles Depot." Having accepted broadly the version given by Lawrence, the High Court took the case of each of the accused and held that in the case of accused Nos. 1 to 4 Lawrence 's evidence had been amply corroborated by other evidence in all material particulars. In these circumstances, we cannot accept the contention of learned counsel for the appellant that the High Court had rejected the evidence of Lawrence. As we have said, the High Court did not accept some parts of the evidence of Lawrence, but it had broadly accepted the version given by Lawrence in regard to the conspiracy and the manner in which the articles were smuggled 235 out of the Depot. If some of the accused were acquitted it was because there were some discrepancies in the evidence of Lawrence in respect of them and particularly because that part of his evidence was not corroborated in material particulars by other evidence. But in the case of the appellant the High Court accepted the evidence given by Lawrence and convicted the appellant because that version was corroborated in all material particulars by the evidence of other disinterested witnesses. We, therefore, reject this contention. This leads us to the consideration of the only remaining question, namely, whether Lawrence 's evidence is corroborated in material particulars implicating the appellant by other acceptable evidence. The corroboration must be by independent testimony confirming in some material particulars not only that the crime was committed but also that the appellant committed it. It is not necessary to have corroboration of all the circumstances of the case or every detail of the crime. It would be sufficient if there was corroboration as to the material circumstances of the crime and of the identity of the accused in relation to the crime. These principles have been settled in R. vs Baskerville, (1) which has rightly been considered as the locus classicus of the law of approver 's evidence and has been followed by courts in India. Looking from that aspect, both the courts have found corroboration from disinterested witnesses in material particulars implicating the appellant in the crime. Lawrence gave a detailed account of the unfurling of the scheme of fraud from the date he met Major Barsay on December 2, 1954, upto December 20, 1954, when the offending truck was obstructed by the police from proceeding further on its onward journey. Lawrence stated in his evidence that on December 3, 1954, Major Barsay told him, inter alia, that he had chalked out a detailed scheme in consultation with Kochhar to transfer all the valuable parts lying in Shed No. 48 to Shed No. 17 for the purpose of itemization, that he had 'already recalled Kochhar from (1) 236 leave of absence prior to its expiry and posted him in the Kit Stores, and that he had also posted Avatarsingh from Unfit Sub Park to the Kit Stores. The prosecution has established by clear evidence that Major Barsay was instrumental in posting Kochhar, accused No. 2, to the Kit Stores after asking him to cut short his leave which was for, a period of two months. It was also established by evidence that Major Barsay brought Avatarsingh to the Kit Stores. Though these facts might not have implicated Kochhar and Avatarsingh, they certainly corroborate the evidence of Lawrence that Major Barsay told him that these transfers were made to facilitate the implementation of the scheme. Lawrence stated in his evidence that Major Barsay told him on December 3, 1954, that he had chalked out a detailed scheme in consultation with Kochhar to transfer all the valuable parts lying in Shed No. 48 to Shed No. 17 for the purpose of itemization, and that as soon as the Board of Officers was appointed there would be a shuttle of trucks moving from Shed No. 48 to Shed No. 17 and vice versa and nobody 's suspicion would be roused if one or two trucks were taken away out of the main gate during the course of these movements of the trucks between these two sheds. There is evidence to show that a Board of Officers was appointed to do the work of itemization and that one Captain Mehendiratta was appointed the President of that Board. Lawrence said that Major Barsay told him that he would show certain boxes from Shed No. 48 to Col. Rao and tell him that they did not contain many of the articles which they were said to contain, so that Col. Rao also would not be surprised at the final result of the itemization. It has been established by other evidence that on December 8, 1954, Major Barsay went to Col. Rao and took him to Shed No. 48 and showed him the military stores that were lying there awaiting itemization. At about midday on December 18, 1954, Lawrence stated, Major Barsay met him at the Depot and told him that he and other conspirators would meet at his 237 residence to discuss about the scheme. It is in evidence that on the 18th the meeting was held as deposed to by Lawrence. Evidence of Col. Sindhi and Capt. Sharma, which was accepted by both the courts, establishes this fact. The same evidence also establishes that at that meeting Major Barsay, Saighal, Lawrence and two Sikhs were present, and though the two Sikhs were not identified to be accused Nos. 2 and 3, the presence of accused Nos. 1 and 4 and two Sikhs corroborates the evidence of Lawrence. Lawrence stated that at that meeting Major Barsay undertook to do certain things. According to Lawrence Major Barsay told the conspirators that he would detail a driver of his confidence in a vehicle for executing the plan, that he would send Kochhar to Shed No. 17, order Kochhar to transfer the itemized goods from Shed No. 17 to Shed No. 26 ostensibly for the purpose of preservation, that he would call Major Nag on Monday (December 20) and in his presence he would order Lawrence to go to the D.O.D. to bring the fire hoses. The evidence of Havaldar Pillay, Godse, Suryawanshi and G. K. Pillay establishes the fact that Barsay secured one truck and a driver for shifting of the stores from Shed No. 17 to Shed No. 26. The evidence of Jamadar Lachmansing proves that Major Barsay went to Shed No. 17 and ordered the shifting of stores from there to Shed No. 26 for conditioning and preservation. The evidence of Major Nag establishes that in his presence Major Barsay sent for Lawrence and asked the latter to go to the D.O.D. and expedite the return of the fire hoses. These established facts certainly corroborate the evidence of Lawrence as to what took place on the 18th and also his evidence that Major Barsay gave the said instructions to him in the presence of Major Nag. The evidence of Lawrence that Major Barsay told him and the other conspirators that there should be two loadings of the trucks at Shed No. 17, the first loading to carry innocuous articles and the second the articles intended to be smuggled out of the Depot, was also corroborated by disinterested evidence. Both the courts accepted that evidence. 238 Then there is evidence of the movements of Major Barsay during the crucial time when the smuggling out of the goods was scheduled to take place. The evidence of Jogendrasingh, Rambhan and Wagh shows that at about 1 10 p.m. on December 20, 1954, Major Barsay was rather worried and was moving to and fro near the main gate because he was suspecting that somebody was watching their movements. Jamadar Jogendrasingh deposed that Major Barsay asked him to tell Lawrence, "not to do it as there was something suspicious about it." Major Nag also supported this version. These nervous movements of Major Barsay certainly corroborate the evidence of Lawrence that he was the moving spirit in the conspiracy. The evidence of Lawrence that the duty of going along with the truck was allotted to his part in the conspiracy is corroborated by the circumstances establisbed by the evidence that Lawrence got into the truck near Shed No. 17 and went in the truck to its destination. The evidence of Lawrence regarding how Major Barsay directed the smuggling of the goods out of the Depot was corroborated by other independent evidence. There is evidence of Jog and Diwate to show that on December 19, in the morning, Saighal showed the spot where the transshipment was to take place to Lawrence. There is the evidence of Darekar to show that a truck was arranged and that he was asked by Yakubsaheb to take his truck to Talegaon for the transport of iron goods. There is also the evidence of Darekar and Hatnolkar to establish that accused No. 4 was waiting near the cemetry on the Talegaon Dabhade Road and that Darekar was also instructed by Saighal to park the lorry in a particular way. Then there is the evidence of the police officers that the goods brought in the military lorry were being transported into the civilian truck when they came on the scene. All this evidence supports the version of Lawrence when he said that Major Barsay gave the necessary instructions as to the manner of transport of the military goods to the civilian truck. 239 The said facts found by both the courts below implicate accused No. 1 in the matter of the preparation, laying down of the details of implementation and the actual carrying out of the scheme of smuggling the goods out of the Depot through all the stages and thereby establish that the appellant was the main conspirator and the brain behind the conspiracy. We cannot, therefore, say that the version given by Lawrence implicating accused No. 1 is not corrobo rated by other independent evidence. It follows that the conviction of the appellant by the High Court is correct. This leads us to the appeal filed by the State against the judgment of the High Court acquitting accused Nos. 2 and 3 on the ground that the evidence of Lawrence implicating them in the offence was not corroborated in material particulars by independent evidence. In this appeal also we have not allowed learned counsel for the State to canvass the correctness of the finding arrived at by the High Court on the appreciation of the evidence in the case. Taking the findings arrived at by the High Court, we find it difficult to take a different view from that taken by the High Court. In regard to accused No. 2 the High Court arrived at the following findings: (1) There is no evidence or allegation on the record to show that there was any understanding between him and Major Barsay before he left on two months leave. (2) There is no evidence that Kochhar, accused No. 2, met Lawrence on December 6, 1954. (3) Accused No. 2 moved Major Barsay by his letter (exhibit 151) to convene the itemization board. (4) Prior to the appointment of the board and its constitution, accused No. 2 ordered the shifting of the "specialist boxed kits" from Shed No. 48 to Shed No. 17, but this was done under Major Barsay 's instructions. (5) Accused No. 2 was present when Fernandez was ordered by Major Barsay to complete the identification of the first set before December 13, even by working on Sunday the 12th December, and in that connection a written order was issued by him on December 11. (6) On December 12 Lawrence persuaded accused No. 2 to go in for two 240 insurance policies. (7) Though according to Lawrence, Kochhar undertook to prepare a bogus voucher and to be at the Depot at the opening hours on Monday the 20th to prepare that voucher in the office of Lawrence, it is admitted that Kochhar refused to issue the voucher. (8) Accused No. 2 was present at Shed No. 17 when Major Barsay issued orders to shift the stores to Shed No. 26. And (9) Accused No. 2 accompanied Major Barsay to Shed No. 19 in the morning and lie was present when the truck was being loaded for the second trip at Shed No. 17. The High Court found that the said circumstances, though some of them might raise a suspicion, did not implicate accused No. 2 in the offence and they are consistent also with his innocence. Though some of the facts give rise to a suspicion, we cannot say that the High Court was wrong in holding that the said facts did not corroborate the evidence of Lawrence in implicating the said accused in the offence. Now coming to accused No. 3, the High Court found the following facts based on the evidence other than that of Lawrence: (1) Avatarsing, accused No. 3, was transferred from Unfit Sub Park to Kit Stores. (2) Accused No. 3 was a party to the shifting of stores from Shed No. 48 to Shed No. 17 even before the appointment of the board of itemization. (3) Though Lawrence stated that Avatarsing expressed his inability to push the scheme on account of Capt. Kapoor 's constant vigilance and visits to Shed No. 17, Lawrence had admitted that his first contact with Avatarsing was in the noon of 18th December. (4) There is no evidence that Avatarsing attended the meeting at Major Barsay 's on the 18th. (5) Avatarsing loaded the truck for the first trip and also for the second trip, and in loading the second trip he used the usual laborers and two outside workers. (6) After the truck was loaded, he asked Rambhan to take the truck to D. 0. D. under instructions from the superior officers. (7) The words "D. O. D." in exhibit 42, the duty slip, were not entered by Avatarsing. The High Court held that the said facts found on independent evidence did not implicate the said accused in the offence and 241 they were all consistent with his innocence. Though some of the findings give rise to suspicion we cannot say that the High Court was wrong in holding that the said facts found did not corroborate the evidence of Lawrence in implicating the accused in the offence. We, therefore, accept the finding of the High Court in regard to accused Nos. 2 and 3. In the result both the appeals fail and are dismissed. Appeals dismissed.

The appellant and five other persons, three of Them not being public servants, were charged with criminal conspiracy to dishonestly or fraudulently misappropriate or convert to their own use military stores and with dishonestly and fraudulently misappropriating the same. Sanction for prosecution of the accused was given by a Deputy Secretary on behalf of the Central Government. The accused were tried by a Special judge. The main evidence led was that of one L, a security officer. , who had been asked to join the conspiracy and who had joined it with a view to have the offenders apprehended. The Special judge convicted all the accused persons. On appeal the High Court confirmed the conviction of the appellant and one other accused now dead and acquitted the other four accused persons holding that the evidence of L was corroborated in material particulars in respect of the appellant and one other accused only. The appellant contended: (i) that the appellant who was subject to the Army Act could only be tried by a Court Martial and the Special judge had no jurisdiction to try him, (ii) that the sanction to prosecute was void as it was not expressed to be 196 made in the name of the President, (iii) that the investigation by the Inspector of Police, was illegal, (iv) that there could be no legal charge of conspiracy between accused who were public servants and accused who were not, and (v) that L was a wholly unreliable witness whose testimony ought to have been rejected totally and no question of its corroboration arose. Held, that the Special judge had jurisdiction to try the appellant for the offences charged. The Army Act does not bar the jurisdiction of criminal courts in respect of acts or omissions which are punishable under the Army Act as well as under any other law in force. The offences charged were triable both by the Special judge and by a Court Martial. In such cases section 125 of the Army Act provides that if the designated officer decides that the proceedings should be before a Court Martial he may direct the accused to be detained in military custody. But in the present case the designated officer bad not exercised his discretion and the Army Act was not in the way of the Special judge exercising his jurisdiction. Rule 3 made under section 549, Code of Criminal Procedure for persons subject to military law was applicable only to magistrates and not to a Special judge who is not a magistrate within the meaning of r. 3. Besides, section 7 of the Criminal Law (Amendment) Act, 952, provides that notwithstanding anything contained in the Code of Criminal Procedure or in "any other law" the offences specified in section 6(1) shall be triable by Special judges only. The words "any other law" included the Army Act also. The offences for which the appellant was convicted were offences specified in section 6(1) and were exclusively triable by a Special judge. Held, further, that the sanction for the prosecution of the appellant was a good and valid sanction. Article 77 of the Constitution which provides that all orders of the Central Government shall be expressed to be in the name of the President is only directory and not mandatory. Where an order was not issued in strict compliance with the provisions of article 77 it could be established by extraneous evidence that the order was made by the appropriate authority. In the present case there was uncontroverted evidence which established that the order of sanction was made by the Deputy Secretary on behalf of the Central Government in exercise of the power conferred on him under the rules delegating such power to him. The State of Bombay vs Purushottam jog Naik, [1952] S.C.R. 674, Dattareya Moreshwar Pangarkar vs The State of Bombay, ; , J. K. Gas Plant Manufacturing Co., Ltd. vs The King Emperor, , P. Joseph John vs The State of Travancore Cochin; , and Ghaio Mall & Sons vs The State of Delhi, [1959] S.C.R. 1424, applied. Held, further, that though the conditions of investigation by the Inspector of Police as laid down in section 5A, Prevention of Corruption Act were not complied with the trial. was not vitiated 197 by the illegality as it did not result in any miscarriage of justice. The powers and jurisdiction of members of the Delhi Special Police Establishment for investigation of offences in the State of Bombay had been duly extended by a notification of the Government of Bombay dated August 13, 1949, giving a general consent in respect of all the members of the establishment. It was not necessary that the consent be given to every individual member of the Establishment. H.N. Rishbud & Inder Singh vs State of Delhi, ; , followed, Held, further, that there was no defect in the charges. It was not illegal to charge public servants and persons who were not public servants with the criminal conspiracy to do certain acts for which all of them could not be convicted separately. Though all the accused were not liable for the individual offences, they were all guilty of the offence of conspiracy to do illegal acts. Held, further, that the evidence of L was reliable and that it was corroborated in material particulars so far as the appellant was concerned. Though L was not an accomplice, he was an interested witness and required corroboration. The evidence of an approver and the corroborating pieces of evidence could not be treated in two different compartments; but had to be considered together. Though some parts of the evidence of L were not accepted, his version was broadly accepted in regard to the conspiracy and the manner in which articles were smuggled out. Sarwan Singh vs The State of Punjab, ; , explained.

Appeals Nos. 253 and 254 of 1961. Appeals by special leave from the judgment and order dated May 2,1955, of the Allahabad High Court in Civil Revision Nos. 881 and 882 of 1952. section F. Andley, Rameshwar Nath and P. L. Vohra, for the appellant in C. A. No. 253 of 1961 and respondent No. 2 in C. A. No. 254 of 1961. section P. Varma, for the appellant in C.A. No. 254 of 61 and respondent No. 2 in C.A. No. 253 of 1961. C. B. Aggarwala and C. P. Lal, for the respondent No. 1 in both the appeals. January 19. The Judgment of the Court was delivered by SHAH, J. Vijay Pratap Singh(hereinafter called the plaintiff) a minor by his next friend Pandit Brij Mohan Misir filed a petition in the Court of the Subordinate Judge, Faizabad for leave to sue in forma pauperis for declaration of title to the Ajodhya Raj and accretions thereto and for possession and mesne profits for three years prior to the suit. The petition was rejected by the Subordinate Judge because, in his view, it disclosed no cause of action. An application by Ramjiwan Misir father of the plaintiff who was impleaded as the second defendant, to be transposed as a petitioner was also rejected by the Subordinate Judge. The plaintiff and Ramjiwan Misir applied to the High Court of Judicature at Allahabad in the exercise of its revisional jurisdiction against the orders rejecting 677 their respective petitions but without success. They have with special leave appealed to this Court against the orders passed by the High Court. The case set up by the plaintiff in his petition was briefly this. Maharaja Sir Man Singh holder of the Ajodhya Raj was a Taluqdar in lists I, II and V of the Oudh states set I of 1869. He died in 1870 and the Raj devolved upon his daughter 's son Maharaja Pratap Narain Singh, who died on November 9, 1906, leaving him surviving two widows Suraj Kumari and Jagdamba Devi and no lineal descendant. A will alleged to be executed by Maharaja Pratap Narain Singh on July 20, 1891, was set up but it was void and ineffective because, firstly, it was procured by undue influence, coercion and fraud practised upon the testater, and, secondly it created a line of succession contrary to law. Accordingly on the death of Maharaja Pratap Narain Singh the Raj devolved upon Maharani Suraj Kumari the senior widow and on her death in 1927 upon Maharani Jugdamba Devi, and on the death of the latter on June 18, 1928 upon Ganga Dutt Misir, grand father of the plaintiff Ganga Dutt Misir died in 1942 and the estate devolved upon his son Ramjiwan and his grandson, the plaintiff as co parceners in a Hindu joint family. Even if the will was valid and effective "the terms thereof alongwith Maharaja Pratap Singh 's other acts and declarations" had the effect of taking the estate out of the purview of Act I of 1869 with the result that Maharani Jagdama Devi enjoyed the property in suit with a life estate therein, and on her death on June 18, 1938, the entire property in suit vested in Ganga Dutt on whose death the plaintiff and defendant No. 2 became owners of the entire property in suit as their joint ancestral property". Defendant No.1 Dukh Haran Singh Claimed to be adopted as a son by Jagdamba Devi on February 12, 1909 but the claim was "utterly false, fictitious and untrue" for the reasons set out in the partition, and the 678 Raj was in the wrongful possession of the first defendant Dukh Haran Singh. The plaintiff alleged that his father Ramjiwan Misir was "detained and confined" by the first defendant and was unable to join the plaintiff in the petition. The first defendant Dukh Haran Singh resisted the petition inter alia contending that it did not disclose a cause of action and that, in any event, the claim made by the plaintiff was barred by law of limitation. Initially Ram Jiwan Misir supported the will and the plea of adoption set up by the first defendant, but by an application dated April 21, 1951, prayed that he be transposed as a petitioner submitting that his previous statement was procured by coercion and contained averments which were untrue. Ramjiwan was directed to pay the court fee payable on the plaint within ten days and in default of payment, his application was to stand dismissed. Ramjiwan did not pay the court fee as directed but on July 23, 1951, he again applied for being transposed as a petitioner in the petition for leave to sue in forma pauperis filed by the plaintiff. Holding that it did not disclose a cause of action the Subordinate Judge rejected the petition of the plaintiff. The Subordinate Judge observed that there was nothing in the petition to show how the disputed estate came to be governed by the rule of inheritance under the Hindu Law and, in any event, there was nothing in the petition to support the plea that the estate had lost its impartible character, and that even if in view of the allegations contained in para 12 of the petition it be held that the estate came to be governed by the ordinary Hindu Law, it did not become a partible estate which the plaintiff could inherit, so long at his father Ramjiwan was alive. The petition filed by Ramjiwan Misir was then taken up for 679 hearing and was also rejected because, in the view of the learned Judge, "no useful purpose would be served" by transposing Ram Jiwan Misir as co plaintiff when the application filed by the plaintiff was held to be defective and liable to be rejected under O. 33, r. 5(d), of the Code of Civil Procedure. Against the two orders passed by the subordinate Judge the plaintiff preferred Revision Application No. 881 of 1952 and Ram Jiwan preferred Revision Petition 882 of 1952. The High Court rejected the petition of the plaintiff holding that on the death of Ganga Dutt in 1942 the estate would devolve upon Ram Jiwan Misir alone according to the rule of impartibility which governed the devolution of the estate. The High Court also observed that there was nothing in the petition to show that Ganga Dutt succeeded to the estate "on the basis of his being the nearest male reversioner under the Ordinary Hindu Law", and that it was unnecessary to consider whether the will by Maharaja Pratap Narain took out the estate from the operation of the Act, "because the plaintiff did not rely upon the will and whatever the plaintiff had stated in the petition in connection with the will was simply by way of answer to what might be contended by the defendant in the suit. " Dealing with the petition of Ram Jiwan Misir the High Court observed that "By an application to sue in forma pauperis the applicant prays for a relief personal to himself and therefore nobody else can be properly made a co applicant. There is no direct provision which provides that a court should transpose a party from one side to the other. Order 1, r. 10, gives the power to the court to strike out or add the names of parties when it appears that he has been improperly joined or that he ought to have been joined or his presence before the court would be necessary in order to enable the court effectively and completely to adjudicate upon and settle all the questions involved in the suit. The provisions of 680 this rule will not apply to the proceedings on an application for permission to sue as a pauper". We are unable to agree with the view of the High Court that the petition filed by the plaintiff did not disclose a cause of action, or that O. 1, r. 10 of the Code of Civil Procedure cannot properly be resorted to for transposing a party in a petition for leave to sue in forma pauperis. The plaintiff had by his plaint set up an alternative case. In the first instance he pleaded that the will alleged to be executed by Maharaja Pratap Narain on July 20, 1891, was "void and ineffective" and the estate devolved upon Ram Jiwan and the plaintiff as members of a co parcenary: alternatively, he pleaded that even if the will was valid, by the terms thereof and by the other acts and declaration of Maharaja Pratap Narain Singh, the estate was taken out "of the purview of Act I of 1869" and on the death of Maharani Jagdamba Devi the property devolved upon Ganga Dutt, the nearest reversioner under the Hindu law and on his death it devolved upon the plaintiff and upon his father Ram Jiwan Misir. Order XXXIII of the Code of Civil Procedure prescribes the procedure for institution of suits by paupers. Rule 2 provides that particulars a petition for permission to sue in forma pauperis shall contain and r.3 sets out the mode of presentation of the petition. Rule 4 authorises the Court to examine the applicant or his agent regarding the merits of the case and the property of the applicant. Rule 5 provides: "The Court shall reject an application for permission to sue as a pauper (a) where it is not framed and presented in the manner prescribed by rules 2 and 3, or (b) where the applicant is not a pauper, or 681 (c) where he has, within two months next before the presentation of the application, disposed of any property fraudulently or in order to be able to apply for permission to sue as a pauper, or (d) where his allegations do not show a cause of action, or (e) where he has entered into any agreement with reference to the subject matter of the proposed suit under which any other person has obtained an interest in such subject matter. " Where the application is not rejected on the grounds set out in r. 5, the Court has under r. 6, to proceed, after giving notice to the opposite party and the Government pleader, to receive evidence as the applicant may adduce in proof of his pauperiam. By r. 7 the Court is authorised to consider where the applicant is not subject to any of the prohibitions specified in r. 5. The Court is enjoined to reject a petition where the prohibitions mentioned in cls. (a) to (e) of r. 5. exist. Even if the petition is not so rejected at the hearing of the petition, if the court is satisfied as to the existence of these prohibitions it may be dismissed under r. 7. It does not appear that any objection was raised as to the existence of prohibitions (c) and (d) set out in r. 5, and the Subordinate Judge disallowed the objection that the petition was not framed and presented as prescribed by r. 2 and 3. He did not consider the question whether the plaintff was a pauper. He rejected the application only on the ground that it did not show a cause of action, and the High Court confirmed the order also on that ground. By the express terms of r. 5 cl. (d), the court is concerned to ascertain whether the allegations made in the petition show a cause of action. The court has not to see whether the claim made by the petitioner is likely to 682 succeed: it has merely to satisfy itself that the allegations made in the petition, if accepted as true, would entitle the petitioner to the relief he claims. If accepting those allegations as true no case is made out for granting relief no cause of action would be shown and the petition must be rejected. But in ascertaining whether the petition shows a cause of action the court does not enter upon a trial of the issues affecting the merits of the claim made by the petitioner. It cannot take into consideration the defences which the defendant may raise upon the merits; nor is the court competent to make an elaborate enquiry into doubtful or complicated questions of law or fact. If the allegations in the petition, prima facie, show a cause of action, the court cannot embark upon an enquiry whether the allegations are true in fact, or whether the petitioner will succeed in the claims made by him. By the Statute, the jurisdiction of the Court is restricted to ascertaining whether on the allegations a cause of action is shown: the jurisdiction does not extend to trial of issues which must fairly be left for decision at the hearing of the suit We do not propose to express any opinion on the question whether on the death of Jagdamba Devi the estate devolved under section 22(10) of Act I of 1869 upon Ramjiwan Misir and the plaintiff as members of a co parcenary. Even if that claim is inconsistent with the words of section 22(10) of Act I of 1869 on which the plaintiff himself relies, the plaintiff had an alternative claim that the estate had become non taluqdari by virtue of the will and "the acts and declaration" of Maharaja Pratap Narain. In support of this claim, section 15 of Act I of 1869, before it was amended by U. P. Act III of 1910, is relied upon. At the time when Maharaja Pratap Narain died, section 15 of the Act stood as follows: "If any taluqdar or grantee shall hereto before have transferred or bequeathed, or if 683 any taluqdar or grantee or his heir or legatee shall hereafter transfer or bequeath, to any person not being a taluqdar or grantee the whole or any portion of his estate, and such person would not have succeeded according to the provisions of this Act to the estate or to a portion thereof if the transferor or testator had died without having made the transfer and intestate, the transfer of and succession to the property so transferred or bequeathed shall be regulated by the rules which would have governed the transfer of and succession to such property if the transferee or legatee had brought the same from a person not being a taluqdar or grantee. " It is true that by section 8 of Act III of 1910, the section has been substantially modified and reads as follows: "If any taluqdar or grantee, or his heir or legatee, shall heretofore have transferred or bequeathed, or if any taluqdar or grantee, or his heir or legatee, shall hereafter transfer or bequeath the whole or any portion of his estate to any person who did not at the time when the transfer or bequest took effect belong to any of the classes specified in section 14, the transfer of and succession to the property so transferred or bequeathed shall be regulated by the rules which would have governed the transfer of and succession to such property if the transferee or legatee had bought the same from a person not being a taluqdar or grantee, heir or legatee." By section 21 of the Amending Act III of 1910 a partial retrospective operation was given to the amended section. The retrospective operation was limited by the proviso which enacted that nothing contained in the amending section shall affect suits pending at the commencement of the amending 684 Act, or shall be deemed to vest in or confer upon any person any right or title to any estate, or any portion thereof, or any interest therein, which is, at the commencement of the Amending Act, vested in any other person who would have been entitled to retain the same if the amending Act had not been passed, and the right or title of such other person shall not be affected by anything contained in the said section. Mr. Agarwalla, appearing on behalf of the first defendent Dukh Haran Singh, has contended that in view of the retrospective operation given to section 15, as amended, the claim of the plaintiff that the taluqdari character of the state is destroyed has no force and he has invited our attention to two decisions of the Oudh Chief Court in Kaur Nageshar Sahai vs Shiam Bahadur (1) and Mohammad Ali Khan vs Nisar Ali Khan(2). But we need express no opinion on the correctness or otherwise of these decisions. An enquiry whether by virtue of certain provisions of the statute on which the first defendant relies, the plaintiff may not be entitled to the estate is, as already observed, not contemplated to be made in considering a petition for leave to sue in forma pauperis. The true effect of the amended section 15 of the Oudh Estates Act I of 1869 is a complicated question of law which the Court will not proceed to determine in ascertaining whether the petition for leave to sue discloses a cause of action. The High Court, in our judgment, was in error in observing that there was nothing in the plaint to show that Ganga Dutt succeeded to the estate because he was the nearest male reversioner under the ordinary Hindu law. The plaintiff has emphatically made that assertion: whether the claim to relief on the basis of that assertion was justified must be adjudicated at the trial of the suit, 685 and not in deciding whether the plaintiff should be permitted to sue in forma pauperis. We are also of the view that the High Court was in error in holding that by an application to sue in forma pauperis, the applicant prays for relief personal to himself. An application to sue in forma pauperis, is but a method prescribed by the Code for institution of a suit by a pauper without payment of fee prescribed by the Court Fees Act. If the claim made by the applicant that he is a pauper is not establish the application may fail. But there is nothing personal in such an application. The suit commences from the moment an application for permission to sue in forma pauperis as required by O. 33 of the Code of Civil Procedure is presented, and O. 1, r. 10, of the Code of Civil Procedure would be as much applicable in such a suit as in a suit in which court fee had been duly paid. It is true that a person who claims to join a petitioner praying for leave to sue in forma pauperis must himself be a pauper. But his claim to join by transposition as an applicant must be investigated; it is not liable to be rejected on the ground that the claim made by the original applicable is personal to himself. In our view, the orders passed by the High Court in both the revision applications must be set aside. Before parting with the case, we must take notice of the unsatisfactory progress this litigation had made since it was instituted nearly twelve years ago. We regret to observe that the petition filed in July 1950 for leave to sue in forma pauperis was not disposed of by the Subordinate Judge for two years and it took the High Court three years to dispose of the revision petitions against the orders of the Subordinate Judge. The proceedings were further held up even after special leave was granted by this Court in March, 1957 for nearly five years before the appeal could be heard. This 686 Court had ordered that the hearing of the appeals be expedited and heard on cyclostyled record but the record was not made ready for a long time. We also find that a large number of documents were included in the books prepared for use of the court to which no reference was made at the Bar during the course of the hearing. We trust that the case will be taken up for hearing with the least practicable delay and disposed of according to law. The appellants in the two appeals will be entitled to their costs both in this Court and the High Court. The costs of the trial court will be the cost in the cause. Appeals allowed. Cases remitted.

The Estate of Maharaja Man Singh of Ayodhya Raj devolved on his death successively on his two widows and thereafter, according to V the plaintiff a minor on his grandfather G, who died in 1942. Respondent claimed the estate as adopted son of the junior widow of the Maharaja. V filed a petition for leave to sue in forma pauperis for declaration of title to the estate making his father R a party. The plaintiff 's petition was rejected by the Subordinate Judge, on the ground that it disclosed no cause of action. R 's application to be transposed as petitioner was also rejected. V and R preferred revision applications to the High Court of Allahabad. The plaintiff 's application was rejected by the High Court holding inter alia that there was nothing in the petition to show that succeeded to the estate as the nearest male reversioner of the last male holder. R 's application was rejected by the High Court on the ground that relief in an application to sue in forma pauperis is personal to the applicant and nobody else can be made a co applicant, because 1, R. 10 of the Code of Civil Procedure does not apply to a proceeding for permission to sue as a pauper. ^ Held, that O. XXXIII of the Code of Civil Procedure lays down the procedure for institution of a suit by pauper. By cl. 5 (d) the court is required to ascertain whether the allegation made in the petition show a cause of action, but it does not enter upon a trial of the issues affecting the merits of the claim made by the petitioner. By the statute, the jurisdiction of the Court is restricted to ascertaining whether on the allegations a cause of action is shown: the jurisdiction does not extended to trial of issues which must fairly be left for decision at the hearing of the suit. An application to sue in forma pauperis, is but a method prescribed by the Code for institution of a suit by a pauper without payment of Court fee; and there is nothing personal in such an application. The suit commences from the 676 moment an application for permission to sue in forma pauperis as required by O. 33 of the Code is presented, and O. 1 r. of the Code would be as much applicable in such a suit as in a suit in which court fee had been duly paid. A person who claims to join a petitioner praying for leave to sue in forma pauperis must himself be a pauper. Claim to join by transposition as an applicant must be investigated; it is not liable to be rejected on the ground that the claim made by the original applicant is personal to himself.

ION: Criminal Appeal No. 237 of 1959. Appeal from the judgment and order dated February 10 and 11 of 1959, of the Bombay High Court in Criminal Appeal No. 1023/59 with Crinal Appeals Nos. 1048 and 1048 of 1958. H. R. Khanna and P. D. Menon, for the appellant. section G. Patwardhan. J.B. Dadachanji O.C. Mathur and Ravinder Narain, for the respondent No. 1. 1962. January 23. The Judgment of the Court was delivered by RAGHUAR DAYAL, J. This appeal, on a certificate granted by the High Court of Bombay, raises the question whether the contravention of the provisions of sub section (2) of section 222 of the Code of Criminal Procedure, hereinafter called the Code, in the framing of the charge against an accused, vitiates the trial. The facts leading to the appeal, in brief, are as follows. The respondents were charged and tried at the same trial of the offences under section 120B read with section 406, I.P.C., and of an offence under section 406, I.P.C. and committed in pursuance of the criminal conspiracy they had entered into. They were also tried, but acquitted of other offences charged with. They appealed against their conviction of the offence under section 120 B read with section 406, I.P.C., and of the offence under section 406, I.P.C. The charge under section 406, I.P.C, was with respect to the commission of trust of trust of a sum of Rs. 2,18,369/ between the period March 6. 1949, and June 30, 1950. It was contended before the High Court that the charge framed contravened the provisions of sub 713 section (2) of section 222 of the Code which allowed a combined charge with respect to the amount embezzled within a period of a year. The High Court agreed with this contention and, holding the trial void, set aside the conviction of the respondents and acquitted them of the offences. The High Court, however, maintained the order of acquittal is respect of the other offences. The State of Bombay (now Maharashtra) has filed this appeal against the order setting aside the conviction of the respondents. It is not necessary for us to determine in this appeal the general question whether the contravention of the provisions of sub R. (2) of section 222 of the Code, in the framing of the charge, will always make the trial void, as, in this particular case, the offence under section 406, I.P.C., charged against the respondents was said to have been committed in pursuance of a criminal conspiracy entered into by them. It will therefore suffice, for the purpose of this case, to consider whether such a defect in the charge vitiates the present trial. Section 222 of the Code is one of the sections in Chapter XIX, which deals with Form of Charges. Sections 221, 222 and 223 deal with what should be mentioned in the charge. The whole object of the charge is inform both the prosecution, and the accused particularly, of the accusation the prosecution has to establish and the accused has to meet. So long as the accused knows fully what accusation he has to meet any error in the narrative of the charge need not be fatal to the trial. Sections 225, 232, 535 and 537 save the trial from being vitiated unless of course the accused has been prejudiced and failure of justice has taken place. Sections 233 to 239 deal with the joinder of charger, and they speak not only of an accused being charged with offences, but of such charges 714 being tried separately or jointly. Section 233 states that for every distinct offence of which any person is accused, there shall be a separate charge and every such charge shall be tried separately, except in the cases mentioned in sections 234, 235, 236 and 239. It is clear that the general rule is theat there should be a separate trial for each distinct offence of which a person is accused. It follows that each item of property of which an accused is alleged to have committed breach of trust, constitutes one distance offence and that, in general, it would be necessary to have as many trials as there be distinct offences of criminal breach of trust committed by the accused. But section 222(2) provides that when the accused is charged with criminal breach of trust, the charge may be with respect to the gross sum embezzled within a period of one year and that the charged so framed shall be deemed to be a charge of one offence within the meaning of section 234. The charge framed in the present case was with respect to the gross sum embezzled within a period of more than twelve months, the period being between March 6, 1949 and June 30, 1950. The charge therefore was in contravention of the provisions of section 222(2). This defect in the charge, however, did not lead to any prejudice to the accused in the trial and therefore did not vitiate the trial, in view of the provisions of section 537 of the Code. The charge could have been split up into two charges, one with respect to the offence of criminal breach of trust committed with respect to the amount embezzled between March 6, 1949 and March 5, 1950 and the other with respect to the amount embezzled between March 6, 1950 and June 30, 1950. The two offences of criminal breach of trust could have been tried together in the present case, as the offences were said to have been committed in pursuance of the criminal conspiracy entered into by the accused, All the offences 715 committed in pursuance of the conspiracy are committed in the course of the same transaction and therefore can be tried together at one trial, in view of sub section (1) of section 235 of the Code which provides that if in one series of acts so connected together as to form the same transaction, more offences than one are committed by the same person, he may be charged with and tried at one trial for every such offence. It is therefore clear that no prejudice was caused to the accused by the defect in the charge. A similar view has been taken by this Court in Kadiri Kundahammad vs The State of Madras (1). We may further point out that the High Court should not have expressed its opinion or passed any order with respect to the acquittal of the respondents for the other offences when the order of acquittal was not before it for consideration and when it had held the entire trial to be void, on account of the contravention of the provisions of sub section (2) of section 222. We therefore hold that the trial of the respondents was legal and therefore allow the appeal and set aside the order of the High Court. Their appeal against their conviction has not been heard on merits and therefore we remand the case to the High Court for further hearing according to law.

The respondents were charged and tried at the same trial with the offences of Criminal conspiracy and breach of trust committed in pursuance thereof during a period of more than one year. The question arising for decision was whether, in the framing of the charge, contravention of the provisions of sub s.(2) of s.222 which allowed a combined charge with respect to the amount embezzled within a period of one year, vitiated the trial. ^ Held, that the defect in the charge did not lead to any prejudice to the accused and therefore did not vitiate the trial in view of the provision of section 537 of the Code of Criminal Procedure. When all the offences committed in pursuance of a conspiracy are committed in course of the same transaction this can be tried together at one trial in view of section 235(1) of the Code of Criminal Procedure which provides that if in one 712 series of acts so connected together as to form the same transaction, more offences than one are committed by the same person, he may be charged with and tried at one trial for every such offence. Kadiri Kanhahammad vs The State of Madrs, A.I. R. , followed.

of 1949. Appeal from a judgment of the High Court of Judicature at Calcutta (Harries C.J. and Chakravarthi J. (dated 30th November, 1948, in Civil Revision Case No. 712 of 1948. N.C. Sen Gupta (Ajit Kumar Dutta, with him) for the Appellant. Faiyaz Ali, Advocate General of East Bengal (B. Sen and Noor ud din, with him) for the Respondent. M. C, Setalvad, Attorney General for India, (section M. Sikri and V.N. Sethi, with him) for the Intervener. Dec. 4. The judgment of Kania C.J., Patanjali Sastri j. and Chandrasekhara Aiyar J. was delivered by Patanjali Sastri J. Fazl Ali and Mukherjea JJ. delivered separate judgments. PATANJALI SASTRI J. This is an appeal from a judgment of the High Court of Judicature in West Bengal reversing a finding of the Second Subordinate Judge of 24 Parganas at Alipore that he had jurisdiction to proceed with a suit after substituting the Province of East Bengal (in Pakistan)in the place of the old Province of Bengal against which the suit had originally been brought. The facts leading to the institution of the suit are not in dispute. The Bengal Agricultural Income tax Act was passed by the Provincial Legislature of Bengal in 1944. It applied to the whole of Bengal and purported to bring under charge the agricultural income of, inter alia, "every Ruler of an Indian State." Acting under the provisions of that Act, which came into force on 1st April, 1944, the Income tax Officer, Dacca Range, sent by registered post, a notice to the Manager of the Zemindari Estate called Chakla Roshanabad belonging to the Tripura State but situated in Bengal outside the territories of that State, calling upon him to furnish a return of the total income derived in the 5 previous year from lands in the Estate used for agricultural purposes. The notice was received by the Manager at Agar talla in Tripura State. Thereupon, the State, by its then Ruler, Maharaja Sir Bir Bikram Bahadur, instituted the suit in question on 12th June, 1945, against the Province of Bengal and the Agricultural Income tax Officer, Dacca Range, in the Court of the First Subordinate Judge, Dacca, contest ing the validity of the notice and the proposed assessment on the grounds that the "Provincial Legislature of Bengal had no authority to impose tax on any income of an Indian State or its Ruler" and that, in any case, "the Income tax Officer, Dacca Range, had no authority or jurisdiction to issue the said notice to the Manager of the Estate outside British India. " The cause of action of the suit was alleged to have arisen in the town of Dacca within the jurisdiction of the Court on 28th February, 1945, when the notice was issued. The reliefs sought were a declaration that the Bengal Agricultural Income tax Act: 1944, in so far as it purported to impose a liability to pay agricultural income tax on the plaintiff as a Ruler of an Indian State was ultra vires and void and that, in any case, the notice served by the Agricultural Income tax Officer, Dacca Range, was void and no assessment could be made on the basis of such notice, and a perpetual injunction to restrain the defendants from taking any steps to assess the plaintiff to agricultural income tax. Before the defendants filed their written state ments the suit was transferred by the High Court to the Court of the District Judge, 24 Parganas, and was again transferred from that Court to the Court of the Subordinate Judge at Alipore. The ruler who brought the suit having died, the plaint was amended by the substitution in his place of his son and heir in June 1947, and the suit was pending in that Court when the partition of India took effect on the 15th August, 1947 On 9th December, 1947, the Province of East Bengal filed a petition stating that the Province of Bengal, the original defendant No. 1 in the suit, had ceased to exist with effect from 15th August, 1947, and 6 in lieu thereof two new Provinces, namely, the Province of East Bengal and the Province of West Bengal had come into existence and that, inasmuch as the Province of West Bengal was taking no interest in the suit, it was necessary in the interests of East Bengal that the suit should be contested and that a written statement should be put in on its behalf for such contest. It was accordingly prayed that the ' delay should be condoned and the written statement which was filed with that petition should be accepted. In the written statement it was pleaded that inasmuch as the Province of East Bengal was a Province of the; Dominion of Pakistan and that defendant No. 2 was a Revenue officer of that Province, the Court had no jurisdiction to hear the suit or make an order of injunction against the defendants. It was stated that the Province of East Bengal appeared only to contest the jurisdiction of the Court. By another written statement filed on the same day defendant No. 2 raised also other pleas in defence but his name was struck off the record at the plaintiff 's instance as not being a necessary party to the suit. On the 10th December, 1947, the Province of East Bengal was substituted as the defendant in the place of the Province of Bengal which had ceased to exist, and the writ ten statement filed on behalf of the former was accepted. Thereupon the Subordinate Judge framed a preliminary issue on the question of jurisdiction and, as stated al ready, found it for the plaintiff relying on section 9 of the Indian Independence Act and article 4 of the Indian Inde pendence (Legal Proceedings) Order, 1947. It may be men tioned in passing that the assessment of the plaintiff was proceeded with by the Agricultural Income tax Officer, Comilla Range (East Bengal), who, by his order dated the 22nd December, 1947, imposed on the plaintiff a tax of Rs. 1,79,848 12 0 for 1944 45 and Rs. 1,34,326 7 0 for 1945 46, but the recovery of the amounts has been deferred under orders of the Court pending the decision on the preliminary issue. As pointed out by the Federal Court in Midnapore 7 Zemindary Co. Ltd. vs The Province of Bengal and ,Others (1), the orders promulgated on the 14th August, 1947, by the Governor General of India before the partition in exercise of the powers conferred under section 9 of the Indian Independ ence Act, 1947, and containing provisions specially designed to remove the difficulties arising in connection with the transition to the new situation created by the partition are binding on both the Dominion of India and the Dominion of Pakistan. Among such Orders those relevant to the present controversy are the Indian Independence (Legal Proceedings) Order, 1947, and the Indian Independence (Rights, Property and Liabilities)Order, 1947. By article 4 of the former Order (1) All proceedings pending immediately before the appointed day in any of the special tribunals specified in col. 1 of the Schedule to this Order shall be continued in that tribunal as if the said Act had not been passed, and that tribunal shall continue to have for the purposes of the said proceedings all the jurisdiction and powers which it had immediately before the appointed day; * * * * (3) Effect shall be given within the territories of either of the two Dominions to any order or sentence of any such Special Tribunal as aforesaid and of any High Court in appeal or revision therefrom as if the order or sentence had been passed by a court of competent jurisdiction in that Dominion; * * * * and by article 12 (2) of the latter Order Where any Province from which property, rights or li abilities are transferred by this Order is, immediately before the transfer a party to legal proceedings with re spect to that property or those rights or liabilities the Province which succeeds to the property, rights or liabili ties in accordance with the provisions of this Order shall be deemed to be substituted for the other Province as a party to those proceedings and the proceedings may continue accordingly. (1) 8 On the effect of these provisions the learned Judges of the High Court observed: "If this provision [i.e., article 12 (2)] applies to the present case, there can be no doubt that the Province of East Bengal was substituted in the suit for the Province of Bengal by operation of law, and by reason of the Legal Proceedings Order the suit shall continue in the Court of the Second Subordinate Judge, 24 Parganas, as a suit against the substituted defendant. " With that statement of the position we entirely agree. The learned Judges, however, proceeded to examine, laying stress on the words "by this Order" in article 12 (2), whether any property, rights or liabilities could be said to have been transferred by the Indian Independence (Rights, Property and Liabilities) Order, 1947, from the Province of Bengal to the Province of East Bengal, and they took the view that neither any property, nor rights, nor liabilities were so transferred under that Order and that, therefore, the con tinuation of the proceedings against the Province of East Bengal, which was now part of an Independent Sovereign State, was governed by the principles of international law and comity of nations, and that, according to those princi ples, East Bengal, being a Province of a sovereign state, could not be sued against its will in the municipal courts of India, with the result that the suit pending in the Court at Alipore must abate. They also negatived a further con tention raised before them, apparently for the first time, to the effect that by reason of the petition filed on behalf of the Province of East Bengal for acceptance of its written statement condoning the delay involved and also by reason of sundry other proceedings for interim relief sought by the plaintiff which were actively resisted by the Province of East Bengal, that Province must be taken to have submitted to the jurisdiction of the Court. On behalf of the appel lant, Mr. Sen Gupta challenged the correctness of the deci sion on both points. Before dealing with these contentions, it will be con venient to dispose of two preliminary points raised by Mr. Faiyaz Ali, Advocate General of East Bengal. 9 In the first place, he submitted that the State of Tripura having since been merged in the Dominion of India and a Chief Commissioner having been appointed to administer its territories, the appeal could no longer be prosecuted by the present Maharaja through his mother as his next friend. It was, however, represented to us on his behalf that under the agreement of merger the Estate of Chakla Roshanabad was left to the Maharaja as his personal property and it no longer formed part of the territories of the Tripura State. The Attorney General, appearing on behalf of the Dominion of India, the intervener, confirmed that position. There is thus no substance in the objection as any formal defect in the proceeding could be set right by suitably amending the cause title. Mr. Faiyaz Ali next drew our attention to the Pakistan (Indian Independence Legal Proceedings) Order, 1948, promul gated by the Governor General of Pakistan on 13th November, 1948, with retrospective effect from the 15th August, 1947, and pointed out that in view of its provisions any decree that might eventually be passed by the Court at Alipore would receive no effect in Pakistan and that, therefore, it was unnecessary for this Court to decide the question of the jurisdiction of the Alipore Court to proceed with the suit. We are unable to take that view. The effect of the Order referred to above on any decree that may eventually be passed in the pending suit may have to be taken note of by the Court trying that suit after hearing arguments on the validity of that Order which is challenged but we are at present concerned only with the question of the jurisdic tion of that Court to try the suit and we cannot at this stage refuse to give our ruling on that question merely because any decree that might be passed in favour of the plaintiff might prove ineffectual. Turning now to the main question, it is clear that article 12 (2) of the Rights, Property and Liabilities Order applies only to property rights or liabilities which were transferred by the Order from a Province which was a party to legal proceedings 2 10 "with respect to" that property or those rights or liabili ties. As the suit in question cannot be said to have been instituted with respect to the property transferred, namely, Chakla Roshanabad, the appellant cannot rely upon the trans fer of that property from the Province of Bengal to the Province of East Bengal as part of the territories of Pakistan under the scheme of partition. Nor was there any transfer of "rights"such as was contemplated under that article, for the only right with respect to which the Prov ince of Bengal could be said to have been a party to the pending proceeding on the facts of this case was the right to tax the agricultural income of the plaintiff under the provisions of the Bengal Agricultural Income tax Act, 1944, and that right was not derived by the Province of East Bengal by transfer under the Rights, Property and Liabili ties Order. As rightly pointed out by the High Court, the right of taxation under the Bengal Act of 1944 passed to the Province of East Bengal as part of the Sovereign Dominion of Pakistan by virtue of the provisions of section 18(3) of the Indian Independence Act, 1947, which provided that "the law of British India and of the several parts thereof immediate ly before the appointed day shall, so far as applicable and with the necessary adaptations, continue as the law of each of the new Dominions and the several parts thereof, until other provision is made by the laws of the legislature of the Dominion in question or by any other legislature or other authority having power in that behalf. " The question next arises whether there was a transfer of any "liability" by the Order as contemplated in article 12(2). Mr. Sen Gupta relied in this connection on article 10 (2) (a) which provides that "where immediately before the appointed day the Province of Bengal is subject to any such liability (i.e., "any liability in respect of an actionable wrong other than breach of contract") referred to in sub section (1)that liability shall, where the cause of action arose wholly within the territories which, as from that day, are the territories of the Province of East Bengal, be a liability of that Province. " It was contended that the Province 11 of Bengal was, according to the plaintiff 's case, liable to be restrained from proceeding with the illegal and unautho rised assessment on the basis of the notice issued under the Bengal Act of 1944, and that liability, in respect of which the cause of action arose wholly in Dacca (where the as sessment proceeding had been initiated) within the territo ries of the Province of East Bengal, became a liability of that Province. The High Court rejected this contention on the ground "that article 10(2) is concerned with the liabil ity for an actionable wrong other than breach of contract and it is impossible to say that by serving a notice on the plaintiff under the Bengal Agricultural Income tax Act through one of its officers the Province of Bengal had committed an actionable wrong '. Assuming that it exceeded its power or acted under an invalid provision of law, the plaintiff may have a declaration to that effect but the Act complained of cannot be said to have been a tortious act. But even assuming that it was, it is to be remembered that the issue of the notice was an exercise of powers conferred by the Act in relation to the sovereign rights of the Crown and it is elementary that the Crown or the State is not answerable for even negligent or tortious acts of its offi cers done in the course of their official duties imposed by a statute, except where the particular act was specifically directed and the Crown profited by performance . . No liability for an actionable wrong is thus involved in the suit and Dr. Sen Gupta cannot establish a right to proceed against the Province of East Bengal on the basis that the liability was transferred to that Province under article 10(2) of the Order. " We are unable to share 'this view. The learned Judges have placed much too narrow a construction on the phrase "liability in respect of an actionable wrong". They have assumed that the phrase connotes only a liability for dam ages for a completed, tortious act and that the initiation of what according to the plaintiff was an unauthorised and illegal assessment proceeding by purporting to serve a notice requiring the plaintiff to submit a return of his total agricultural income under section 24 (2) of the Bengal Agricultural 12 Income tax Act, 1944, through an appropriate officer func tioning under that Act, the Province of Bengal had not committed an "actionable wrong". This, in our opinion, is not a correct view of the matter. Under section 9(1) (b) of the Indian Independence Act, 1947, the Governor General of British India was directed to make provision by order "for dividing between the new Dominions and between the new Provinces to be constituted under this Act, the powers, rights, property, duties and liabilities of the Governor General in Council or as the case may be of the relevant Provinces which under this Act are to cease to exist", and the Indian Independence (Rights, Property and Liabilities) Order is the only Order by which such provision was made. The intention being thus to provide for the initial distri bution of rights, property and liabilities as between the two Dominions and their Provinces, a wide and liberal con struction, as far as the language used would admit, should be placed upon the terms of the Order, so as to leave no gap or lacuna in relation to the matters sought to be provided for. There is no reason, accordingly, why the words "li ability in respect of an actionable wrong" should be under stood in the restricted sense of liability for damages for completed tortious acts. We consider that the words are apt to cover the liability to be restrained by injunction from completing what on the plaintiff 's case was an illegal or unauthorised act already commenced. The service of the notice on the plaintiff under section 24(2) of the Bengal Act amounts to much more than a mere threat in the abstract to impose an illegal levy. It is the actual initiation of an illegal assessment proceeding which, in the normal course, will 'in all probability culminate in an illegal levy of tax. The failure to make a return as required by the notice would result under section 25(5) of the Act in the Income tax Officer making an ex parte assessment to the best of his judgment and determining the sum payable by the assessee on the basis of such assessment. Such failure would also expose the plaintiff under section 32(1) of the Act to the impo sition of a penalty which may equal the amount of the tax assessed on him or to a prosecution as for an offence 13 before a Magistrate under section 53 (1), at the option of the Income tax authority. It is thus plain that the service of a notice requiring a return of income to be furnished for assessment under the Act is a step fraught with serious consequences to the assessee, and if the assessment proposed was illegal and unauthorised by reason of the Act itself being ultra vires in so far as it purported to make the Rulers of Indian States liable to taxation thereunder as contended for by the plaintiff, the service of such notice marked the commencement of a wrongful act against the plain tiff by the Bengal Government under colour of the Act and there can be no doubt that such a wrongful act is actionable in the sense that an action would lie in a civil court for an injunction restraining its completion. That was the liability to which the Province of Bengal was subject ac cording to the plaintiff 's case at the time when he insti tuted the suit, and that liability, in our opinion, passed to the Province of East Bengal by virtue of article 10 (9.) (a) of the Indian Independence (Rights, Property and Liabil ities) Order, 1947. There is no question here of the li ability of the Crown for damages for the negligent or tor tious act of its officers. On the allegations in the plaint, which must, for the purpose of deciding the question of jurisdiction as a preliminary issue, be assumed to be well founded, the Province of Bengal was undoubtedly liable to be sued for an injunction restraining it from proceeding with the assessment and none the less so because the notice was served in purported exercise of powers conferred by the Bengal Act. The name of the Income tax Officer originally impleaded as the second defendant having been struck off the record, no question in regard to his liability arises. Reference was made to certain text books where a "tort" is spoken of as an "actionable wrong" and it was suggested that the two expressions are synonymous. Every tort is undoubtedly an actionable wrong but the converse does not necessarily follow. Indeed, the words "other than breach of contract" used in article 10 (1) make it plain that the expression "actionable wrong" is used in a wider sense 14 which would have included breach of contract but for those limiting words. It was said that even assuming that the service of the notice calling for a return of income was a wrongful act, it was not "actionable", as section 65 of the Bengal Act barred suits in civil courts "to set aside or modify any assessment made under this Act". The short answer to this contention is that the suit in question is not a suit "to set aside or modify an assessment" made under the Act, as no assessment had yet been made when it was instituted, and the subsequent completion of the assessment was made by the Pakistan In come tax authorities on terms agreed to between the parties and sanctioned by the Court. The decision of the Privy Council in Raleigh Investment Co. Ltd. vs Governor General in Council (1) relied on in support of the contention is distinguishable, as the main relief claimed there was repay ment of the tax alleged to have been wrongfully levied under colour of an ultra vires provision in the Indian Income tax Act. Their Lordships observed: "In form the relief claimed does not profess to modify or set aside the assessment. In substance it does, for repayment of part of the sum due by virtue of the notice of demand could not be ordered so long as the assessment stood. Further, the claim for the declaration cannot be rationally regarded as having any relevance except as leading up to the claim for repayment, and the claim for an injunction is merely verbiage. The cloud of words fails to obscure the point of the suit. " The position here is entirely different. The gist of the wrongful act complained of in the present case is sub jecting the plaintiff to the harassment and trouble by commencing against him an illegal and unauthorised assess ment proceeding which may eventually result in an unlawful imposition and levy of tax. It was suggested, somewhat faintly, that the cause of action for the suit, though stated in the plaint to have arisen in Dacca, now in the Province of East (1) 15 Bengal, did not arise wholly within the territories of the Province of East Bengal within the meaning of Article 10 (2) (a) inasmuch as the notice calling for a return, though issued from Dacca, was received by the Manager of the Estate at Agartalla in Tripura State. Assuming that the contention has any substance it is of no assistance to the respondent, for article 10 (2) (c) would then be applicable to the case and the Province of East Bengal would still be liable, though jointly with the Province of West Bengal. We are therefore of opinion that the Province of East Bengal having succeeded to the liability to which the Province of Bengal was subject immediately before the ap pointed day, the former Province is to be deemed to be substituted for the other Province as a party to the suit and the suit must accordingly continue in the Court of the Subordinate Judge at Alipore, which has jurisdiction to proceed with it under article 4 of the Indian Independence (Legal Proceedings) Order, 1947. In this view it is unnecessary to consider the question of submission to jurisdiction urged in the alternative by the appellant. In the result the appeal is allowed, the order of the Court below is set aside and the suit now pending in the Court of the Subordinate Judge at Alipore will be heard and determined by it. The respondent will pay the appellant 's costs throughout. FAZL ALI J. The question to be decided in this appeal is whether the Subordinate Judge 's Court at Alipore in the State of West Bengal, has jurisdiction to try a suit in which the Province of East Bengal was impleaded as a defend ant, after the 15th August,1947 In what circumstances this question has arisen will appear from the facts of the case which may be briefly stated. In 1944, the Bengal Legislature passed an Act called the Bengal Agricultural Income tax Act, 1944 (Bengal Act IV of 1944), which enabled it to impose a tax on the agricul tural income of various classes 16 of persons including "every Ruler of an Indian State," holding lands within the territory of Bengal. The appel lant, who is the Ruler of the State of Tripura, holds a zamindary called Chakla Roshanabad Estates, which was situ ated in the Province of Bengal and in the District of Sylhet formerly appertaining to the Province of Assam. On the 28th February, 1945, the Agricultural Income tax Officer, Dacca Range, issued a notice under section 24 (2) of the Bengal Act to the Manager of the Chakla Roshanabad Estates calling upon him to furnish a return of the appellant 's total agri cultural income for the previous year, derived from lands situated within the Province of Bengal. On the 12th June, 1945, the appellant instituted a suit in the Court of the Subordinate Judge at Dacca, against the Province of Bengal and the Agricultural Income tax Officer, Dacca Range, claim ing the following reliefs: (1) For a declaration that the Bengal Agricultural Income tax Act, 1944, so far as it imposes a liability to pay agricultural income tax on the plaintiff is ultra vires and void and that the plaintiff ' is not bound by the same. (2) For a declaration that in any case the notice served by the Agricultural Income tax Officer, Dacca Range, above referred to, is void and of no effect and that no assessment can be made on the basis of that notice. (3) For a perpetual injunction to restrain the defend ants from taking any steps to assess the plaintiff to agricultural income tax. On the 15th July, 1945, the suit was transferred to the Court of the Subordinate Judge at Alipore in the District of 24 Parganas, by an Order of the Calcutta High Court. While the suit was still pending, the new Province of East Bengal, which forms part of the territories of the Dominion of Pakistan, came into existence on the 15th August, 1947, as a result of the Indian Independence Act, 1947, and it appears that the whole of Chakla Roshanabad Estates falls within that Province. After the creation of the new Province, 17 a petition was filed on the 9th December, 1947, on behalf of the Province of East Bengal, drawing the attention of the Court at Alipore to the fact that the Province of West Bengal, which forms part of the territories of the Dominion of India, was taking no interest in the suit and asking the Court to accept a written statement which was also filed along with the petition, and in which the only plea taken was that the Alipore Court had no jurisdiction to hear the suit or make any order of injunction against the Province of East Bengal or defendant No. 2. The last paragraph of the written statement was to the following effect: "The Province of East Bengal appears only to contest the jurisdiction of the court and it submits that the suit should be dismissed on that ground. " Later on, the Province of East Bengal was irapleaded as a defendant in the suit and the name of the Income tax Officer of Dacca was removed from the category of defend ants. The Subordinate Judge then proceeded to try the question of jurisdiction as a preliminary issue, and decided that by virtue of the provisions of the Indian Independence (Legal Proceedings) Order, 1947, read with section 9 of the Indian Independence Act, 1947, the Court had jurisdiction to try the suit against the new Province. Thereupon, the respondent (the Province of East Bengal) moved the High Court at Calcutta under section 115 of the Code of Civil Procedure, against the order of the Subordinate Judge, and a Bench of the High Court consisting of Harries C.J. and Chakravarthi J. allowed the application and set aside the order of the Subordinate Judge, giving effect to the objec tion of the respondent that the Court at Alipore was not competent to try the suit against the Province of East Bengal. One of the points raised on behalf of the appellant before the High Court was that the Province of East Bengal had submitted to the jurisdiction ' of the Subordinate Judge 's Court, but this point was negatived. The appellant was thereafter granted a certificate under section 205 (1) of the Government of India Act, 1935, and on the basis of it he has preferred this appeal. 18 On a reference to the judgments of the learned Subordi nate Judge and the High Court, it appears that three provi sions were relied upon by the appellant in support of his contention that the Court at Alipore had jurisdiction to try the suit, these being section 9 of the Indian Independ ence Act, 1947, article 4 of the Indian Independence (Legal Proceedings) Order, 1947, [hereinafter referred to as 'the Legal Proceedings Order '], and section 12 of the Indian Independence (Rights, Property and Liabilities) Order, 1947, Therein after referred to as ' the Rights, etc., Order ']. These provisions run as follows : Section 9 of the Indian Independence Act : "The Governor General shall by order make such provi sion as appears to him to be necessary or expedient (a) for bringing the provisions of this Act into effective operation; (b) for dividing between the new Dominions, and be tween the new Provinces, to be constituted under this Act, the powers, rights, property, duties and liabilities of the Governor General in Council or, as the case may be, of the relevant Provinces which, under this Act, are to cease to exist . . " Section 4 of the Legal Proceedings Order : "Notwithstanding the creation of certain new Provinces and the transfer of certain territories from the Province of Assam to the Province of East Bengal by the Indian Independ ence Act, 1947, (1) all proceedings pending immediately before the appointed day in any civil or criminal court (other than a High Court) in the Province of Bengal, the Punjab or Assam shall be continued in that court as if the said Act had not been passed, and that court shall continue to have for the purposes of the said proceedings all the jurisdiction and powers which it had immediately before the appointed day; (2) any appeal or application for revision in respect of any proceedings so pending in any such 19 court shall lie in the court which would have appellate, or as the case may be revisional, jurisdiction over that court if the proceedings were instituted in that court after the appointed day; and (3) effect shall be given within the territories either of the two Dominions to any judgment, decree, order, or sentence of any such court in the said proceedings, as if it had been passed by a court of competent jurisdiction within that Dominion. " Section 12 of the Rights, etc. Order : "(1) Where immediately before the appointed day, the Governor General in Council is a party to any legal proceed ings with respect to any property, rights or liabilities transferred by this Order, the Dominion which succeeds to the property, rights or liabilities in accordance with the provisions of this Order shall be deemed to be substituted for the Governor General in Council as a party to the pro ceedings, and the proceedings may continue accordingly. (2) Where any Province from which property, rights or liabilities are transferred by this Order is, immediately before the transfer, a party to legal proceedings with respect to that property or those rights or liabilities, the Province which succeeds to the property, rights or liabili ties of this Order shall be deemed to be substituted for the other Province as a party to those proceedings, and the proceedings may continue accordingly. (3) Any proceedings which, immediately before the ap pointed day, are pending by or against the Secretary of State elsewhere than in the United King dom in respect of any liability of the Governor General in Council or a Prov ince shall, * * * * (b) in the case of proceedings in respect, of the Prov ince of Bengal, the Province of the Punjab, or the Province of Assam, be continued by or against the Province which suc ceeds to the liability . . " The learned Subordinate Judge based his judgment entire ly upon section 4 of the Legal Proceedings 20 Order, but the High Court has pointed out that that Order standing by itself can be of no help to the appellant. According to the High Court, that section might have enabled the appellant to prosecute his suit against the Province of Bengal, but it could not enable 'him to continue the suit against the new Province without invoking section 12 (2) of the Rights, etc. Order, which provides among other things that the Province which succeeds to the rights or liabilities of the old Province of Bengal by virtue of that Order shall be deemed to be substituted for the latter as a party to the pending proceedings. In my opinion, this is the correct view. It Was urged before us that a Court which had juris diction to try a suit against a party would, by reason of what is provided in section 4 of the Legal Proceedings Order, naturally have jurisdiction to substitute the heir or legal representative of that party. Generally speaking, this must be so, but, in the present case, the Province of East Bengal which forms part of another sovereign State could not be automatically substituted for the Province of Bengal, unless the substitution was permitted by some provision of the Indian Independence Act or any of the Orders issued thereun der. The whole case thus rests on the proper construction of section 12(2) of the Rights, etc. Order. In the High Court, it was strenuously urged on behalf of the appellant that section 12(2) is fully applicable to the present case on account of certain rights having been transferred to the Province of East Bengal from the old Province of Bengal. This argument was reiterated in this Court also, but it is obviously untenable, for the reasons set out in the judgment of the High Court. As has been pointed out by the High Court, section 12 (2) is of no help to the appellant, unless the rights in question were transferred by the Rights, etc. Order itself. The learned counsel for the appellant however failed to point out any provision of this Order, by which any of the rights referred to by him had been transferred. He had therefore to fall back upon an alternative argu ment based on section 10(2) of the same Order; and the point to be decided by this Court has thus 21 crystallized into one simple issue, namely, whether section 10(2) of the Order can be of any avail to the appellant. Section 10 (2) must be read with section 10 (1), and the material part of these two sub sections runs as follows : "10 (1) Where immediately before the appointed day the Governor General in Council is subject to any liability in respect of an actionable wrong other than breach of con tract, that liability shall, (a) where the cause of action arose wholly within the territories which, as from that day, are the territories of the Dominion of India, be a liability of that Dominion;. (2) Where immediately before the appointed day the Province of Bengal is subject to any such liability as aforesaid, that liability shall, (a) where the cause of action arose wholly within the territories which, as from that day, are the territories of the Province of East Bengal, be a liability of that Prov ince; (b) where the cause of action arose wholly within the territories which, as from that day, are the territories of the Province of West Bengal, be a liability of that Prov ince; and (c) in any other case, be a joint liability of the Provinces of East and West Bengal." * * * * It is quite clear that for the application of section 10(2), it is necessary to show inter alia that the Province of Bengal was subject to a liability in respect of an ac tionable wrong other than a breach of contract. A reference to any book on tort will show that the words used in sub section (1) are commonly used to define a tort. A tort has been defined in Stroud 's Judicial Dictionary, Second Edition, page 2072, as a wrong independent of contract, and it is also so described in the Common Law Procedure Act, 1852 (15 & 16 Vict., c. 76); in Halsbury 's Laws of England and in many textbooks. The difference between "a wrong independent of contract" and "a wrong other than a 22 breach of contract" is merely verbal and has little signifi cance. A tort is also often referred to as "an actionable wrong" and the two expressions have been synonymously used by eminent writers including Sir Fredrick Pollock and Pro fessor Burdick of America, who has designated his well known book on the law of torts as "a concise treatise on civil liability for actionable wrongs to person and property". Whether the expression can be taken to be a complete defini tion of a tort may be questioned, because as Addison has pointed out in his book on torts, "to say that a tort is an actionable wrong leaves undefined the term 'actionable wrong '. " But there can be no doubt that in legal parlance, the two expressions are assumed to be interchangeable. There is also another matter to be borne in mind in construing section 10 (2) of the Rights, etc. Order, and that is the well recognized fact that the primary and most common remedy for a tort is an action for damages. That this is an important feature of a tort is shown by the fact that in many textbooks an action for damages has been made an inte gral part of the definition of a tort. A few examples will make this clear. A tort is defined by Salmond as "a civil wrong for which the remedy is a common law action for unliq uidated damages and which is not exclusively the breach of a contract or the breach of a trust or other merely equitable obligation." Professor Winfield, who did not see eye to eye with Salmond on many matters connected with the law of torts, gives the following definition of tortious liability : " Tortious liability arises from the breach of a duty primarily fixed by the law; this duty is towards persons generally and its breach is redressible by an action for unliquidated damages. " In Underhill 's law of torts, the definition runs as follows : "A tort is an act or omission which is unauthorized by law and independently of contract infringes (i) some absolute right of another, etc., and (ii) gives rise to an action for damages at the suit of the injured party. " The learned author after attempting to define a tort in this way goes on to state: "A tort is described in the Common 23 Law Procedure Act, 1852, as a wrong independent of contract. If we use the word 'wrong ' as equivalent to violation of a right recognized and enforced by law by means of an action for damages, the definition is sufficiently accurate, but scarcely very lucid;for it gives no clue to what constitutes a wrong or violation of a right recognized and enforced by law. It does, however, emphasize the fact that an essential characteristic of a tort is that the appropriate remedy for it is an action for damages. An act or omission which does not give rise to an action for damages is not a tort. " It must be recognized that an injunction may also be an appropriate remedy in a limited number of cases, but it is not a remedy of universal application, and no one has yet suggested that it may be treated as an incident of tort. In the light of the foregoing discussion, it seems to me to be permissible to infer, firstly, that section 10 of the Rights, etc. Order refers to liability for a tort, and secondly, that what is contemplated there is pecuniary liability such as liability to damages. The word "liabili ty" has a wider meaning and also a narrower meaning, and the latter would appear to be the appropriate meaning where the word is used in contrast to assets or something which corre sponds to or is in the nature of assets, and where it is used in plural or is preceded by an indefinite article, e.g., when the expression "a liability" is used. We must remember that the purpose of the Rights, etc. Order was, among other things, to divide or distribute the rights, property and liabilities of the undivided Province of Bengal between the two new Provinces. Therefore, the view that the liabilities referred to in section 10 are liabilities capable of being ascertained in terms of money and not liabilities in any abstract or academic sense, is in conso nance with the purpose of the Order as well as the well known fact that for a tort the most common and appropriate remedy is an action for pecuniary damages. This view is further confirmed by reading section 13 (2) of the Rights, etc. Order, which runs thus : 24 "Where by virtue of the preceding provisions of this Order either of the Dominions or any Province becomes sub ject to any liability, and it is just and equitable that a contribution towards that liability should be made by the other Dominion, or by another Province, as the case may be, the other Dominion shall make to the Dominion or Province primarily subject to the liability such contribution in respect thereof as, in default of an agreement, may be determined by the Arbitral Tribunal. " It should be noted that the words "becomes subject to any liability" used in the above provision are practically the words which occur in section 10 of the same Order, and the language of section 13 (2) clearly shows that the word "liabili ty" must have been used in the narrower sense of pecuniary liability, because otherwise no question of contribution towards that liability by the Dominion or Province would arise. It will be also instructive to refer to Part VII, Chapter III of the Government of India Act, 1935, the head ing of which is "Property, Contracts, Liabilities, and Suits," and upon which the Rights, etc. Order appears tohave been modeled. In section 179 of the Government of India Act, 1935, which occurs in this Chapter, the clue to the meaning of the word ' liability. ' is furnished by the provision that "any sum ordered to be paid by way of debt, damages or costs in any such proceedings, and any costs or expenses . . shall be paid out of the revenues of the Federation or the Province, as the case may be . . "I think that it will be quite a fair construction to hold that what is contemplated in section 10 of the Rights, etc. Order is that the liability referred to therein would be met out of the revenues of the Province concerned. The construction I have suggested appears to me to represent what the framers of the Order must have intended to convey by the words "liability in respect of an action able wrong", but, lest it should be said that it is too narrow a construction, I shall deal with the matter more fully giving to the words "actionable wrong" and "liability" as wide a meaning as they can 25 bear in a legal context. Proceeding on this footing, the first question to be asked is: What is a wrong other than a breach of contract ? In answering this question, it is neither possible nor helpful to ignore all that has been said in authoritative textbooks and judgments in dealing with the question of a tort, because the foundation of every tort is a wrong or a wrongful act. It is true that at one time some of the writers were inclined to think that "there was no English law of tort but there was merely an English law of torts, that is, a list of acts and omissions which under certain conditions were actionable." But, now, the view has considerably broadened, and, generally speaking, it is acknowledged that ' 'torts are infinitely various not limited or confined" (see Chapman vs pickersgill), and that wherever there is an injury by the invasion of a right, a wrong or a tort is committed. This is often conveyed by the expression injuria sine damnum. The word "wrong" has been used in sections 17, 18 and 19 of the Code of Civil Proce dure, and the following extract from Mulla 's commentary thereon will show how this word has been construed: "Wrong means a tort or actionable wrong, i.e., an act which is legally wrongful as prejudicially affecting a legal right of the plaintiff. " Underhill also construes "wrong" in the same sense, because a wrong is, according to him, equivalent to viola tion of a right recognised and enforced by law by means of an action for damages. I think therefore that in view of all that has been written and said on the subject, it may be safely stated that a wrong must consist of the following elements : (1) There must be an act or omission amounting to an infringement of a legal right of a person or a breach of legal duty towards him; and (2) The act or omission must have caused harm or damage to that person in some way, the damage being either actual or presumed. These two elements are denoted by two Latin expressions, injuria and damnum. I have to include (1) [1762] 2 Wils. 146, per Pratt C.J. 4 26 presumed damage under the second head, because in certain cases such as trespass, assault, false imprisonment, etc. the invasion of a right may be so flagrant that "the law conclusively presumes damage." (See observations of Lord Wright M.R. in Nicholls vs Ely Beet Sugar Factory(1 ). Such cases are often described as cases of absolute liability or cases where a tort is actionable per se without proof of damage. Let us then see whether the two elements of an action able wrong are present in this case. For this purpose, we must examine the best and most plausible statement of the appellant 's case which may be put more or less in the fol lowing way : The issue of a notice, which has been referred to in paragraph S of the plaint calling upon the appellant to furnish a return of his total agricultural income derived from lands situated within the Province of Bengal, was the first step in the initiation of an illegal assessment pro ceeding which was likely to lead to an illegal levy of tax, and the commencement of an illegal proceeding in this manner gave a right of action to the appellant and entitled him to claim an injunction restraining the defendants from complet ing the proceeding. Such being the position, the case is covered by section 10 of the Order under consideration, the words used there being wide enough to cover liability to be restrained by an injunction from completing an illegal or unauthorized act already commenced. Consequently, the li ability to be so restrained must be deemed to have been transferred to the Province of East Bengal, by virtue of section 10 of the Rights, etc. Order. This may appear to be a plausible way of putting the case, but, when we subject it to a close scrutiny, we find that even on the above statement the true requirements of the material provision are not satisfied. If we confine ourselves to something which has happened, as opposed to something which may happen in future, that is to say, if we look for an act or omission which must be the foundation of every wrong, we find that all that is said to have happened in this (1) 27 case is the issuing of a notice, which is not some unautho rised or prima facie unlawful act but is an act done trader the authority of a statute and enjoined by it. It has to be borne in mind that the attack in the plaint is not against the whole Act but all that is contended is that only a par ticular provision of it is ultra vires. The contention comes to this, that the issuing of a notice against every person other than the Ruler of an Indian State would have been a perfectly legitimate act, but the issuing of a notice against a Ruler is ultra vires. But that is not enough to constitute a wrong. What has to be shown is that the issu ing of the notice is a wrongful act, i.e., it amounts to an infringement of some right. What known right of person or property or any other description it infringes is not at all clear; nor has that been stated in the pleadings. It is conceded that there has been no assessment and no realiza tion of any tax and it could not also be disputed that it was open to the appellant to show to the assessing authority that he was not assessable at all. To say that a notice is the first step , in the initiation of an illegal assessment proceeding, does not carry the matter further, but it would seem to be merely a piece of verbiage used to obscure the fundamental weakness of the appellant 's case. Construing "wrong" as it should be construed, the essential thing to find out is in what way a right has been infringed or there has been a breach of duty. It is the appellant 's own case that the suit is for a threatened or apprehended wrong, but that very expression shows that the suit has been brought before the alleged wrong was committed. The other element of a wrong, namely, that the person should have sustained some harm or injury, is also wanting in this case. It is not the case of the appellant that the notice has in any way caused any actual damage to him. Nor is it suggested that this is one of those cases in which damage should be presumed. All that is said is that the notice was likely to entail trouble and harassment to the appellant, but that by itself will not constitute a wrong. 28 The matter may be tested in another way. As Underhill points out," an act or omission which does not give rise to an action for damages is not a tort. " To the same effect is the following observation in Salmond 's Law of Torts: " No civil injury is to be classed as a tort unless the appropriate remedy for it is an action for damages. Such an action is an essential characteristic of every true tort. " Again, Professor Winfield says that an action for unliqui dated damages is the one sure test of tortious liability and has cited cases where this statement has received judicial approval. I think these statements will be equally true if we drop the word "tort" and substitute the words" actionable wrong" in its place. It follows that one of the tests of an actionable wrong is that while other remedies also may be open to the plaintiff, an action for damages is the primary remedy for it. Can the appellant in this case maintain a suit for damages on the allegations made by him in his plaint? As I have already stated, a reference to the plaint shows that no damages has been either alleged or claimed and it has also not been stated that the appellant is entitled to any damage. In Rogers vs Rajendro Dutt(1)the Privy Council stated that "it is essential to an action in tort that the act complained of should be legally wrongful as regards the party complaining; that is, it must prejudi cially affect him in some legal right. " Again, it was ob served in Kali Kischen Tagoor vs Jodoo Lal Mullick(2) that"there may be, where a right is interfered within ju ria sine damno sufficient to found an action; but no action can be maintained if there is neither damnum nor injuria. " It seems to me therefore that in the absence of the two elements to which I have referred, no case for liability in respect of an actionable wrong has been made out, and it is wholly inappropriate to invoke section 10 of the Rights, etc. Order in the present case. It appears that the whole of the appellant 's arguments has been woven round the following two matters : (1) 8 Moore 's I.A. 103 at p. 135. (2) 6 I.A. 190. 29 (1) Injunction is a recognized form of action; and (2) Injunction has been asked for in the present Case, in connection with something which is said to be likely to culminate in a wrong. The situation as envisaged is however very different from what is contemplated in section 10 of the Rights, etc. Order, which is liability for an actionable wrong and not liability for something which may become a wrong in future. It is to be remembered that there are two words used in the section, viz., actionable and wrong. The mere fact that a matter is actionable will not bring the case within the four corners of ' section 10 of the Order, unless all the elements of a wrong are established. I think it will be appropriate at this stage to say a few words about the remedy by way of an injunction in cases where an actionable wrong is said to have been committed. It cannot be disputed that injunction is one of the remedies in certain cases of torts. As Addison has pointed out, "the origin of ' the remedy by way of an injunction is to be found in the inadequacy of the legal remedy by way of damages in many of the more serious wrongs, such as continuing tres passes and nuisances, where a wrongful act has been done and there was an intention to continue doing it. (See Addison 's Law of Torts, 8th Edn. 111). Injunction will also be granted to prevent a threatened injury or wrong, if it can be shown that the threatened act if carried into execution will lead to violation of a right and such will be the inevitable result. As was pointed out in an English case, the interfer ence of the court in these cases is rounded on its jurisdic tion to give relief in the shape of preventive justice in order to protect properties and rights from that which, if completed, would give a right of action. These two cases in which an injunction may be issued stand on two different footings, and the liability to an injunction does. not necessarily and always amount to "liability in respect of an actionable wrong". The two liabilities may possibly coin cide where there is a continuing wrong and the injunction is intended to stop its 30 continuance. But, as I have already stated, where no wrong has been committed, it would require considerable straining of the meaning of familiar legal expressions to say that "liability in respect of an actionable wrong" is identical with "liability to an injunction in respect of an apprehend ed wrong". "Liability in respect of an actionable wrong" means liability when an actionable wrong has been committed. It cannot mean liability to be prevented from a wrong which is apprehended. Nor can the liability which is contemplated in section 10 of the Rights, etc. Order be created by the mere filing of a suit in which an injunction is claimed. I should like to refer here to section 176 (1) of the Government of India Act, 1935, which provides as follows : "The Federation may sue or be sued by the name of the Federation of India and a Provincial Government may sue or be sued by the name of the Province, and, without prejudice to the subsequent provisions of this chapter, may, subject to any provisions which may be made by Act of the Federal Legislature or a Provincial Legislature enacted by virtue of powers conferred on the Legislature by this Act, sue or be sued in relation to their respective affairs in like cases as the Secretary of State in Council might have sued or been sued if this Act had not been passed. " This section is divisible into two parts. The first part states as to which authority should be named as a plaintiff or as a defendant in a suit brought by or against the Crown or the Government, and the second part deals with cases in which the Federal or the Provincial Government may sue or be sued. To understand the latter provision, the section is to be read with section 65 of the Government of India Act, 1858, and section 32 of the Government of India Act, 1915. Section 65 of the Act of 1858 enacted that "the Secretary of State in Council shall and may sue and be sued as well in India as in England by the name of the Secretary of State in Council as a body corporate; and all persons and bodies politic shall and 31 may have and take the same suits, remedies and proceedings, legal and equitable, against the Secretary of State in Council of India as they could have done against the said Company." (East India Co.). The same provision is substantially made in section 32 of the Act of 1915. Such being the law, the question has been posed in a number of cases from very early days as to whether, and, if so, in what cases, the Secretary of State would be liable for a wrong or a tort committed by the servants of the Crown, and it has now been definitely held that he may be liable in certain cases. So far as the present discussion is concerned, the following three points which emerge from a careful perusal of a large number of cases bearing on the subject, seem to be material : (1) The principles of the law of torts have been con sistently applied in all cases dealing with the liability of the Secretary of State for wrongs committed by the serv ants or agents of the crown or the Government. (2) It is settled law that the Secretary of State cannot be held liable for wrongs committed by the servants of the Crown in the performance of duties imposed by the Legisla ture: [See Shivabhajan vs Secretary of State for India(1). James Evans vs Secretary of State(2). Tobin vs Reg(3). Ross vs Secretary of State(4), in which this principle is fully explained and the reasons upon which it is based, are clear ly set out]. (3) It is also well settled that where a statute spe cially authorizes a certain act to be done by a certain person, which would otherwise be unlawful or actionable, no action will lie for the doing of the act. On these principles, it would appear that neither the Agricultural Income tax Officer, who has now been dismissed out of action, nor the Province of East Bengal, could be said to be subject to a liability in respect of an action able wrong, assuming that an actionable wrong has been committed. It must (1) I.L.R. (3) ; (2) A.I.R. 1920 Lah. 364. (4) I.L.R. 32 however be stated that this conclusion rests on the. as sumption that my construction of an actionable wrong is correct. It was contended that in deciding the present appeal, we must assume all the facts stated in the plaint to be correct and therefore assume that the Bengal Act is ultra vires and the notice issued was without authority. I have already pointed out that the whole Act is not attacked, but only one single provision thereof is said to be ultra vires, and I shall show later, when I deal with section 65 of the Bengal Act, that even the assumption we are asked to make will not bring the case within section 10 of the Rights, etc. Order. Mr. Setalvad, the learned Attorney General of India, who intervened on behalf of the Union of India in the ap peal, supported the judgment of the High Court on three main grounds, which may be summed up as follows : (1) that the words used in section 10 of the Rights, etc. Order do not cover this case, because here no wrong has been actually committed and a threatened wrong is different from an actual wrong; (2) that section 65 of the Bengal Agricultural Income tax Act is a bar to the suit; and (3) that the present suit must in any event end in an infructuous decree and should not be allowed to be pursued. I have already dealt with the first point, and wish simply to add that the point which is now pressed is not specifically raised in the Memorandum of Appeal presented in this Court, nor is there any trace of it in the Statement of Case filed by the appellant. The point which is mentioned in the Memorandum of Appeal and the Statement of Case is that section 12 of the Rights, etc. Order is applicable to the present case, because certain rights have been trans ferred from the old Province of Bengal to the Province of East Bengal. There is however no mention of section 10 of the Order, nor is it stated that liability to an injunction brings the case within that 33 section. Thus, a notable feature of the case is that almost every argument which was advanced in the courts below is to be discarded, and we are asked to base our decision on a point, which is not urged in the Statement of the Case, and which, in accordance with the rules of practice of this Court, cannot ordinarily be entertained. The second point urged by Mr. Setalvad is based on section 65 of the Bengal Act, which runs as follows : "No suit shall be brought in any Civil Court to set aside or modify any assessment made under this Act, and no prosecution, suit or other proceeding shall lie against any officer of the Crown for anything in good faith done or intended to be done under this Act." Strictly speaking, this section does not apply to the present case, as there has yet been no assessment and ex facie the appellant 's suit cannot be regarded as a suit to set aside or modify any assessment. Mr. Setalvad however contends that this section must be read with the decision of the Privy Council in Raleigh Investment Co. vs Governor General in Council(1). That was a case under the Indian Incometax Act, 1922, the provisions of which are similar to the provisions of the Bengal Act and which contains a sec tion (section67) which is almost identical in terms with section 65 of the latter Act. In that case, an assessee paid under protest the tax assessed on him and then brought a suit for the following reliefs : (a) a declaration that certain provisions of the Income tax Act on which the assessment was based were ultra vires and so the assessment was illegal; (b) an injunction restraining the. Income tax Depart ment from making the assessments in future; (c) repayment of the sum assessed. It was strongly contended upon the facts of the case that section 67 of the Income tax Act had no application, but it was held by the Privy Council that "though in form the relief claimed did not profess to (1) 5 34 modify or set aside the assessment, in substance it did,because the repayment could not be ordered so long as the assessment stood ' '. It was further held that an as sessment made under the machinery provided by the Act, if based on a provision subsequently held to be ultra vires was not a nullity but a mistake of law in the course of its exercise. Lastly, it was held that the Act contained machin ery which enabled an assessee to raise the question whether or not a particular provision of the Act bearing on the assessment made upon him was ultra vires and that jurisdic tion to question the assessment otherwise than by use of the machinery expressly provided by the Act appeared to be inconsistent with the statutory obligation to pay 'arising by virtue of the assessment. The material part of the judgment on the last point runs as follows : "In construing the section it is pertinent in their Lord ships ' opinion, to ascertain whether the Act contains machinery which enables an assessee effectively to raise in the Courts the question whether the particular provision of the Income tax Act bearing on the assessment made is or is not ultra vires. The presence of such machinery, though by no means conclusive, marches with a construction of the section which denies an alternative jurisdiction to enquire into the same subject matter. The absence of such machinery would greatly assist the appellant on the question of con struction and, indeed, it may be added that, if there were no such machinery and if the section affected to preclude the High Court in its ordinary civil jurisdiction from considering a point of ultra vires, there would be a serious question whether the opening part of the section, so far as it debarred the question of ultra vires being debated, fell within the competence of the Legislature. In their Lordships view it is clear that the In come tax Act, 1922, as it stood at the relevant, date,did give the assessee the right effectively to raise inrelation to an assessment made upon him the question whether or not a provision in the Act was ultra vires. Under section 30, an assessee whose only ground of complaint was that effect had been given in the assessment 35 to a provision which he contended was ultra vires might appeal against the assessment. If he were dissatisfied with the decision on appeal the details relating to the procedure are immaterial the assessee could ask for a case to be stated on any question of law for the opinion of the High Court and, if his request were refused, he might apply to the High Court for an order requiring a case to be stated and to be referred to the High Court . It cannot be doubted that included in the questions of law which might be raised by a case stated is any question as to the validity of any taxing provision in the Income tax Act to which effect has been given in the assessment under review. Any decision of the High Court upon that question of law can be reviewed on appeal. Effective and appropriate machinery is therefore provided by the Act itself for the review on grounds of law of any assessment. It is in that setting that section 67 has to be construed. In conclusion their Lordships would observe that the scheme of the Act is to set up a particular machinery by the use of which alone total income assessable for income tax is to be ascertained. The income tax exigible is determined by reference to the total income so ascertained and only by reference to such total income. Under the Act (section 45) there arises a duty to pay the amount of tax demanded on the basis of that assessment of total income. Jurisdiction to ques tion the assessment otherwise than by use of the machinery expressly provided by the Act would appear to be inconsist ent with the statutory obligation to pay arising by virtue of the assessment. The only doubt, indeed, in their Lord ships ' mind, is whether an express provision was necessary in order to exclude jurisdiction in a civil Court to set aside or modify an assessment. " The authority of this decision was not questioned before us, but it was pointed out firstly that the present suit is not hit by the first part of section 65 of the Bengal Act, which refers only to suits to set aside or modify any as sessment, and secondly, that if the case is not covered by section65, the decision of the Privy Council, which was based on the construction of section 36 67 of the Income tax Act, is not applicable. Mr. Setalvad, replying to the first contention, has urged that we must not look merely to the letter of the section but to the princi ple underlying it, and he has particularly referred us to the fact that, strictly speaking, the reliefs claimed in the above mentioned case do not fall within the letter of sec tion 67 of the Income tax Act and hence the Privy Council observed in that case: "In form the relief claimed does not profess to modify or set aside, the assessment. In sub stance it does . The cloud of words fails to obscure the point of the suit. " However that may be, it seems to me that the Privy Council in arriving at their decision, were influenced not only by the language of section 67 of the Income tax Act but also by the complete machinery furnished by that Act for dealing with all questions arising in regard to the assessment, including the question of ultra vires as would appear from the fact that while laying down that there was no jurisdiction to question the assessment except by use of the machinery expressly provided by the Act, their Lord ships added: "The only doubt, indeed, in their Lordships ' mind, is whether an express provision was necessary in order to exclude jurisdiction in a civil court to set aside or modify an assessment." think that, for the purpose of understanding the full scope of section 65, we must read not only the first part of the section which bars suits to set aside or modify an assessment, but also its latter part which provides that "no suit or other proceeding shall lie against any officer of the Crown for anything in good faith. intended to be done under this Act." The latter part of the section clearly excludes the jurisdiction of the court to prevent the Income tax Officer from proceeding With an assessment which has already been started. Reference may here be made to Secretary of State vs Meyyappa Chetti ar(1) where it was held that the expression "intended to be done" signified futurity so as to preclude suits for injunction in respect of proceedings 'intended ' to be taken by the Income tax Officer. It is true that in terms the provision concerns the Income tax Officer only, but it (1) I1946] , at 352. 37 could hardly have been the intention of the Legislature that though that Officer is not liable to be restrained from proceeding with an assessment, the provision which ensures such a result may be rendered nugatory by permitting an injunction to be claimed against the Provincial Government or the State. In my opinion, it will be a strange construc tion of the section to hold that although it bars suits to modify or set aside an assessment and though it bars all proceedings to restrain the Officer who is making the as sessment from proceeding with it, yet it leaves it open to a party to stop an assessment by claiming an injunction against the Provincial Government or the State instead of the Officer concerned. There is no reference to the Provincial Government or the State at all in the first or the second part of the section, but the section as a whole concerns only with excluding the jurisdiction of the civil court in regard to certain acts done or intended to be done in connection with the assessment of agricultural income tax, and, on a fair construction, it must be held to bar all suits in connection with such assessment. In urging his third point, the learned Attorney General relied on an Ordinance passed by the Governor General of Pakistan on the 13th November, 1948, section 2 whereof runs as follows : "No judgment, decree, order or sentence referred to in paragraph (3) of Article 4 of the Indian Independence (Legal Proceedings) Order, 1947, shall affect the legislative or executive right or authority of the Central or any Provin cial Government of Pakistan and where such right or authori ty has been at issue, the judgment, decree, order or sen tence shall be invalid and inoperative subject to any decision that may be obtained from a competent court, of the Province concerned. " It was pointed out that by reason of this Ordinance, any decree which may be obtained in the present suit would be wholly infructuous and in this view this was a meaningless litigation which should not be allowed to continue. There is force in this argument, 38 but the point need not be pursued, as, in my opinion, the first two points raised by the Attorney General are suffi cient to meet the principal contention advanced by the appellant. The question of submission to jurisdiction appears to me to be unarguable upon the facts stated, and it was not seriously argued before us. The Province of East Bengal did intervene and apply for permission to file a written state ment, but the only statement made by it was that the Court had no jurisdiction to proceed with the suit. It cannot therefore be held that it had submitted to the jurisdiction of the Court. I have tried to deal with the question posed in this appeal in all its material aspects, but it can, I think, be disposed of on the simple ground that the mere issuing of a notice under section 4 of the Bengal Agricultural Income tax Act by the Agricultural Income tax Officer cannot be held to be an actionable wrong, because no right known to law can be said to have been infringed thereby. One of the recognized tests of an actionable wrong is that, while other remedies may also be open to the person to whom the wrong is done, he can always maintain an action for damages, on the principle that every injury imports damage. I am however certain that no action for damages can be maintained on the allegations made by the appellant in his plaint. I think that the entire argument urged on behalf of the appellant has been sufficiently answered by the High Court in the following passage, which appears to me to sum up the legal position accurately and concisely : "Nor was Dr. Sen Gupta right in relying on article 10 (2) for the transfer of liabilities. That Article is con cerned with liability for an actionable wrong other than breach of contract and it is impossible to say that by serving a notice on the plaintiff under the Bengal Agricul tural Income Tax Act through one of its officers, the Prov ince of Bengal had committed an actionable wrong. Assuming it exceeded its powers or acted under an invalid provision of law, the plaintiff may have a declaration to that effect, but the 39 act complained of cannot be said to have been a tortious act. But even assuming it was, it is to be remembered that the issue of the notice was in exercise of powers conferred by the Act in relation to the Sovereign rights of the Crown and it is elementary that the Crown or the State is not answerable for even negligent or tortious acts of its offi cers done in the Course of their official duties imposed by statute, except where the particular act was specifically directed and the Crown profited by its performance. There is no such allegation in the plaint in the present case. The plaintiff could not therefore have sued the Province of Bengal for an actionable wrong and the suit actually brought is not a suit of that character. It is a suit for ,certain declarations and an injunction and does not seek to make the Province liable for any actionable wrong in any way. No liability for an actionable wrong is thus involved in the suit and Dr. Sen Gupta cannot establish a right to proceed against the Province of East Bengal on the basis that the liability was transferred to that Province under article 10 (2) of the Order. " In the result, I would dismiss this appeal with costs. MUKHERJEA J I agree with my learned brother Patanjali Sastri J. that this appeal should be allowed and I would desire to indicate briefly the reasons that have weighed with me in coming to a conclusion different from that ar rived at by the learned Judges of the Calcutta High Court. All the material facts in relation to this case have been set out with elaborate fullness in the judgment of the High Court and I deem it quite unnecessary to state them over again. The whole controversy centers round the point as to whether the suit which was instituted by the plaintiff appellant against the Province of Bengal, as it was prior to the 15th of August, 1947, and which is still pending in the Court of the Subordinate Judge at Alipore can be continued against the Province of East Bengal which has come into existence, as a part of the Dominion of Pakistan, upon the 40 partition of Bengal under the Indian Independence Act; and whether the court of the Subordinate Judge of Alipore which is a court in the Dominion of India has any jurisdiction to proceed with and try such suit. The Subordinate JUdge decided these questions in favour of the plaintiff appellant basing his decision entirely upon article 4 (1) of the Indian Independence (Legal proceedings) Order, 1947, read with section 9 of the Indian Independence Act. The High Court in revision ' set aside the order of the Subordinate Judge holding inter alia that neither article 4 (1) of the Legal Proceedings Order nor article 12 (2) of the Indian Independence (Rights, Property and Liabilities) Order, 1947, could confer upon the plaintiff any right to continue the suit against the Province of East Bengal. The Alipore Court, it has been held, has no jurisdiction to proceed with the suit and no jurisdiction has been conferred upon it by reason of the Province of East Bengal appearing in the suit and putting in a written statement only for the purpose of challenging the competency of the court to try the same. It is the propriety of this decision that has been challenged before us in this appeal. The first point that requires consideration is whether article 4 (11 of the Legal Proceedings Order has any appli cation to the facts of the present case. In my opinion, the answer to this question must be in the negative and the view taken by the High Court on this point seems to me to be perfectly sound and unassailable. The Legal Proceedings Order as well as several other orders dealing with various constitutional matters affecting the two Dominions which were to come into being on and from the 15th of August, 1947, were promulgated by the Governor General of India just on the previous day, that is to say, the 14th of August, 1947, in pursuance of section 9 (1) of the Indian Independence Act which made it a duty on the part of the Governor General to make suitable provisions for removing the difficulties arising in connection with the transition to the new constitutional order. As the two 41 Dominions came into existence under the Indian Independence Act passed by the British Parliament and these orders were made by the Governor General of India in exercise of the authority conferred upon him by the Independence Act, there cannot be any doubt that the provisions of these orders are fully binding on India as well as the Dominion of Pakistan; and they being provisions made to be applicable only for the transitional period, the question does not really arise as to whether or not they are in strict conformity with the principles of International Law which would ordinarily govern the relations between two sovereign States. Article 4(1) of the Legal Proceedings Order is worded as follows: "Notwithstanding the creation of certain new Provinces and the transfer of certain territories from the Province of Assam to the Province of East Bengal by the Indian Independ ence Act, 1947, (1) all proceedings pending immediately before the appointed day in any civil or criminal court (other than a High Court) in the Province of Bengal, the Punjab or Assam shall be continued in that court as if the said Act had not been passed, and that court shall continue to have for the purposes of the said proceedings all the jurisdiction and powers which it had immediately before the appointed day. " The clause of the article is couched in very wide lan guage and under it all proceedings pending in any civil or criminal court in the Province of Bengal, the Punjab or Assam immediately before the 15th of August, 1947, would continue as before and be heard and tried by the courts before which they are pending irrespective of the fact that such proceedings might relate to persons or property situat ed in the other Dominion. I agree with the High Court in holding that comprehensive though the provision is, by itself it can render no assistance to the plaintiff appel lant. The suit was commenced here by the plaintiff against the old Province of Bengal as the party defendant and against 42 that defendant the suit may be continued if the plaintiff so chooses under article 4(1) of the Legal Proceedings Order mentioned above. But this would be of no benefit or advan tage to the plaintiff for what he wants is to proceed against the Province of East Bengal which is a part of the Dominion of Pakistan as a substituted defendant in place of the Province of Bengal. Dr. Sen Gupta argues that if the court has jurisdiction to continue the suit, this would necessarily carry with it the power to make proper orders for substitution as the court considers necessary. But such substitution could be made only under the ordinary provi sions of law which regulate the conduct of such suits. There is no provision of any municipal law which contemplates or authorises the substitution of one sovereign state for another in a pending suit. If, therefore, the plaintiff wants to proceed against the new Province of East Bengal, he must find warrant for it in some of the provisions made by the Governor General of Indian exercise of the powers vested in him under the Indian Independence Act. Admittedly there is no such provision in the Legal Proceedings Act and reli ance is, therefore, placed by the plaintiff upon article 12 (2) of the Rights, Property and Liabilities Order, 1947, which is in the following terms : "Where any Province from which property, rights or liabilities are transferred by this Order is, immediately before the transfer, a party to legal proceeding with re spect to that property or those rights or liabilities, the Province which succeeds to the property, rights or liabili ties in accordance with the provisions of this Order shall be deemed to be substituted for the other Province as a party to those proceedings, and the proceedings may con tinue accordingly. It is not disputed that in order to attract the opera tion of this provision, it is incumbent upon the plaintiff to show that the right or liability to which his suit re lates has been transferred from the Province of Bengal, as it existed prior to the 15th of August, 1947, 43 to the Province of East Bengal in Pakistan in accordance with the provisions of this Order. To establish this, reli ance was placed on behalf of the plaintiff upon several provisions of the Rights, Property and Liabililies Order, 1947, and none of his contentions in this respect were accepted as sound by the learned Judges of the High Court. In this court Dr. Sen Gupta took his stand on a two fold ground. He argued in the first place that for the purpose of invoking the aid of article 12(2) of the Rights, Proper ty ' and Liabilities Order it is not necessary that the transfer of the right and liability to which the proceeding relates should take place under any of the specific articles enumerated in the Order. It would be enough according to him, if there is a transfer by or under any machinery which the Order sets up or authorises What he says is that as the Province of East Bengal is proceeding to assess and levy agricultural income tax upon the plaintiff in respect of a period anterior to 15th of August, 1947, the right to do so can vest in the Province either under an agreement between the two Dominions or the two Provinces or on the basis of an award by an arbitral tribunal as contemplated by article 3 of the Rights, Property and Liabilities Order. In either case it would amount to transfer of rights under the provi sions of the Order and would attract the operation of arti cle 12(2). This argument is manifestly unsound and cannot be ac cepted. If the right referred to by the learned Counsel means the fight to impose tax on agricultural income earned within its territory, the State of Pakistan did not acquire such right by transfer from the Province of Bengal. It is a right inherent in sovereignty itself which the Dominion of Pakistan got under the Indian Independence Act. Again if the right has been created by the Bengal Agricultural In come tax Act, the Province of East Bengal would certainly be entitled to avail itself of the provisions of that Act under section 18(3) of the Independence Act. Apart from this, Dr. Sen Gupta has not referred us to any agreement between the two Dominions or the two Provinces or to the decision of any arbitral tribunal 44 under which the right in dispute in the present case was transferred to the Province of East Bengal. This contention must therefore fail. I have now to consider the other argument on this point advanced by the learned Counsel that the liability of the Province of Bengal in respect to the cause of action upon which the plaintiff 's suit had been rounded became a liabil ity of the Province of East Bengal under the provision of article 10(2) of the Rights, Property and Liabilities Order. It is not disputed that if this contention succeeds, the plaintiff would be entitled to the benefit of clause (2) of article 12 of the Order. Clause (2) of article 10 has to be read with clause (1) of that article and taking the two clauses together the provision of article 10(2) would stand thus : "Where immediately before the appointed day the Province of Bengal is subject to any liability in respect of an actionable wrong other than a breach of contract, the li ability shall (a) when the cause of action arose wholly within the territory which as from that day are the territories of the Province of East Bengal be a liability of that Province. " If the allegations made by the plaintiff in the plaint are assumed to be correct, the Province of Bengal was liable to be restrained from proceeding to levy agricultural income tax upon the plaintiff which was illegal, as being imposed by a statute which so far as it affected the plain tiff was unconstitutional and void. The question is whether this can be said to be a liability in respect of an action able wrong other than a breach of contract within the meaning of that expression occurring in article 10 set out above. It may be noted here that the rights and liabilities arising out of contracts have been dealt with in articles 8 and 9 of the Order. The High Court took the view that the expression "actionable wrong other than a breach contract" is synonymous with 'tort '. It has held that the act com plained of cannot be a tortious act and 45 even if it is so, no action would lie upon it, it being an established proposition of law that the State is not answer able for any tortious acts of its officers done in the course of official duties imposed by a Statute. It seems to me that the learned Judges have attached a narrow and some what restricted meaning to the words of the Article men tioned above and that the plain language of the provision read in the light of the context would demand and justify a wider and more liberal interpretation. In my opinion, there can be an actionable wrong which does not arise out of a breach of contract and at the same time does not answer to the description of a 'tort ' as it is understood in English law; and if the plaintiff 's allegations are correct, it is an actionable wrong precisely of that type which we have in the present case. The word "wrong" in ordinary legal language means and signifies "privation of right". An act is wrongful it infringes the legal right of another, and "actionable" means nothing else than that it affords grounds for action in law. Ordinarily, the word "injury" is used in the same sense of actionable wrong, while "damage in contrast with injury means loss or harm occurring in fact whether actionable as injury or not"(1). In English law "tort" is a species of civil injury and so is a breach of contract; but it is not quite correct to say that the two together exhaust all forms of actionable wrongs known to English law. It is true that a tort is often described as wrong independent of contract. As a legal definition this description, as I shall show presently, is not quite accurate and unless taken with certain limitations is apt to be misleading. It is well known that in England the principles of modern law of contract and tort emerged solely out of the intricacies of the old "Forms of Action '" under which they lay buried for ages. The injuries which in modern law are described as torts were remedied in early time by certain writs, known as writs of trespass (1) Vide the observation of Viscount Simon in Crofter etc. Company Ltd vs Vetch ; , 442. 46 and trespass on the case. The latter was more elastic than the former and was capable of being adapted to new circum stances and to new types of injuries. There was no clear line of demarcation in those days between contractual and tortious liability and in fact tile aCtiOn of "assumpsit" which was the method of enforcing simple contracts was a variety of action on the case and was made use of for recov ery of compensation from a party who failed to perform his agreement on the ground that such failure amounted to a wrong in the nature of deceit(1). When the principles of substantive law gradually extri cated themselves from the entanglements of for realistic procedure, a distinction was drawn between liability for breach of contract and that for tort. In a breach of con tract the right violated owes its origin to the agreement of the parties while in tort the right infringed is one created by tile general law of the land. From about the middle of the 19th century the assumption current in England was that all civil causes of action must be rounded either on con tract or on tort and all injuries which were not breaches of contract would come under the category of torts. This as sumption as Sir Frederick Pollock observes has no historical foundation to rest upon(2). In 1852 the Common Law Proce dure Act was passed and a tort was described in the Act as "a wrong independent of contract". It cannot be denied that this mode of expression became very common in legal par lance; but as more than one modern writer on the law of torts have pointed out, the words in such description would have to be interpreted in a particular way and with certain limitations; taken literally it would not be a correct statement of law. It has been observed by Underhill in his "Law of Torts" that a description like this would be accurate in law if the word "wrong" is taken in the restricted and technical sense as equivalent to "violation of a right (1) Vide Pollock on Contract, 12th Edition, p. 111; Winfield on Tort pp, 3 4 (4th Edition). (2) Vide Pollock 's Article on Tort, Encyc. Vol.22, p. 307. 47 recognised and enforced by law by means of an action for damages". Taken in this form, the definition though it gives no clue as to what constitutes a wrong, certainly does lay stress on the essential characteristic of a tort, viz., that the appropriate remedy f9r it is an action for damages(1). It is really this characteristic that differen tiates a tort from other forms of civil injury or actionable wrong even though the latter are unconnected with any con tract. There may be other remedies besides damages avail able to the plaintiff against a tortfeasor in the shape of restitution, injunction etc. , but no "civil injury" as Salmond observes "can be classed as tort unless the appro priate remedy for it is an action for damages. Such an action is an essential characteristic of every true tort. "(2) Other remedies like injunction or restitution can be claimed by the plaintiff but it is solely by virtue of a right to damages that the wrong complained of can be regard ed as a tort. By way of illustration the author points out that a public nuisance is not to be deemed a tort, because the civil remedy by way of injunction may be obtained at the suit of the Attorney General. A refusal to perform a statu tory duty is not a tort if the remedy is by way of mandamus. Nor would any wrong be regarded as a tort if the remedy is not an action for unliquidated damages but for a liquidated sum of money. A breach of trust is certainly an actionable wrong independent of contract and the beneficiaries can claim compensation if the trustee has misappropriated trust property; but as the claim cannot be for unliquidated damages, it is not regarded as a tort(3). According to Salmond, the reason for this exclusion is purely historical as a breach of trust or any other equitable obligation was considered to be within the special jurisdiction of equity courts. It is interesting to observe that although the difference between equitable and common law jurisdiction is not existent at the present day, the old rule is still applied (1) Vide Underbill 's Law of Torts. 16th Edn., p. 4. (2) Vide Salmond 's Law of Torts, 10th Edn., pp. 7 & 8. (3) Vide Winfield 's Law of Tort, p. 11 48 to demarcate the boundary of the law of torts in English common law. Thus tort is a civil injury other than a breach of contract which is capable of sustaining an action for unliq uidated damages in a court of law. If the appropriate remedy is not a claim for unliquidated damages but for injunction or some other relief, it would not rank as a tort though all the same it would be an actionable wrong. By way of illustration I may refer to the case of Halsey vs Brotherhood(1) which was decided by Sir George Jessel. Both the plaintiff and defendant in this case were engineers and held patents for the manufacture of certain types of engines. The plaintiff brought an action against the de fendant alleging that the latter had threatened to bring legal proceedings against several persons who were actual or intending purchasers of engines from the plaintiff assert ing that the engines manufactured by the plaintiff were infringements of the defendant 's patent. There was a claim for damages and also for injunction. It was held by Sir George Jessel that the plaintiff could not claim damages on the basis of slander of title, as he nowhere alleged that the defendant 's statements or representations were not bona fide. But even though the statements had been made in good faith, the plaintiff would be entitled to an injunction against the defendant if he succeeded in proving that the latter 's allegations of infringement were not true. As no proper case for injunction on this basis was made in the claim, the action was dismissed; but liberty was given to the plaintiff to bring an action in the proper form claiming an injunction to restrain the defendant from threatening the plaintiff 's customers. This threat to customers was thus held to be an actionable wrong but as the remedy was injunc tion and not damages, it was not a tort in the legal sense of the term. In the case before us the act of the Province of Bengal complained of by the plaintiff is not a tort according to the technical rules (1) 49 of English law, but is certainly an actionable wrong as it can be sued upon in a court of law and remedied in an effective manner. The appropriate remedy for the wrong is not unliquidated damages which is essential in a tort but an injunction restraining the defendant from proceeding with the illegal assessment or from realising the amount assessed if assessment has actually taken place. If, as the plaintiff alleges, the relevant provision of the Bengal Agricultural Income tax Act, under which the plaintiff is sought to be assessed, is illegal and ultra vires, the issuing of the notice by the Income tax Officer is certainly the first and the essential step in the commis sion of the wrongful act which furnishes a sufficient cause of action for the suit. As this is not a case of tort, the principle of law, according to which a state is not liable to any damages for tortious acts of its servants, cannot be invoked as a bar to the suit. A remedy by way of injunction can be claimed against a State or Province unless the act complained of amounts to an 'act of State ' in its strict sense and is not purported to be done in exercise of the powers conferred upon the Government by any municipal law. As the avowed object of the Rights, Property and Liabilities Order is to distribute and adjust as far as possible the rights, properties and liabilities between the two Dominions which were to come into being under the Indian Independence Act, the language of the Order should be construed as liber ally as possible, and there is no warrant for putting an interpretation upon the words used more restricted than they would bear in English law. It is argued that article 10(2) (a) does not apply to this case as the cause of action did not wholly arise within the territory of the Province of East Bengal. The argument does not impress me at all. The notice was issued by the Income tax Officer of Dacca which is in Pakistan territory though it was received by the plaintiff 's manager at Agarta la which was outside British India at that time. In any event, the Province 50 of East Bengal cannot escape liability on this ground. It would be jointly liable with the Province of West Bengal under article 10(2) (c) of the Rights, Property and Liabili ties Order. In view of my decision on this point, the other question raised by Dr. Sen Gupta as to whether the defendant submit ted to the jurisdiction of the Alipore Court or not does not fall for determination. The learned Attorney General, who intervened on behalf of the Union of India, put forward certain additional grounds in support of the order made by the learned Judges of the High Court. One of the points raised by him is that section 65 of the Bengal Agricultural Income tax Act con stitutes a bar to the suit which, therefore, should not be allowed to 'continue. The other material point is that the suit cannot but result in an infructuous decree, and conse quently there is no justification for allowing it to pro ceed. It is pointed out that an Ordinance has been passed by the GovernorGeneral of Pakistan on the 13th of November, 1948, under which "no judgment, decree or order referred to in paragraph 3 of Article 4 of the Indian Independence (Legal Proceedings) Order, 1947, shall, in any way, affect the legislative or executive right or authority of the Central or any Provincial Government of Pakistan and where such authority or right has been at issue, the judgment, decree or order shall be invalid and inoperative". The first point has been dealt with by my learned brother Patan jali Sastri J. in his judgment and I concur with him in holding that section 65 of the Bengal Agricultural Income tax Act has no application to the present case. The second point, I must say, embarrassed me to some extent and if the effect of the Ordinance is, as has been stated by the learned Attorney General, a doubt may legitimately arise whether it would be worthwhile for the plaintiff to proceed with the suit and whether it would not be more to his advan tage to seek relief in the court of Dacca. But as this point was not raised before the High Court and the question whether an Ordinance of this character could override the provisions of the 51 Orders passed by the Governor General of India under the Indian Independence Act has still to be decided, I refrain from expressing any opinion on this point. In the result, the appeal, in my opinion, should be allowed and I concur in the order which has been made by my learned brother Patanjali Sastri, J. Appeal allowed. Agent for the Appellant: R.R. Biswas. Agent for the Respondent: P.K. Bose. Agent for the Inervener: P. A, Mehta.

The Income tax officer, Dacca, acting under the Bengal Agricultural Income tax Act, 1944, sent by registered post a notice to the Manager of an Estate belonging to the Tripu ra State but situated in Bengal, calling upon the latter to furnish a return of the agricultural income derived from the Estate during the previous year. The notice was received by the Manager in the Tripura State. The State, by its then Ruler, instituted a suit in June, 1946, against the Province of Bengal and the Income tax Officer, in the court of the Subordinate Judge of Dacca for a declaration that the said Act in so far as it purported to impose a liability to pay agricultural income tax on the plaintiff was ultra vires and void, and for a perpetual injunction to restrain the defend ants from taking any steps to assess the plaintiff. The suit was subsequently transferred to the Court of the Subor dinate Judge of Alipore. The partition of India under the Indian Independence Act took place on the 158h August 1947, and the 2 Province of East Bengal in which the Estate was situated, was substituted as a defendant in the place of the Province of Bengal on an application made by it, and in its written statement it contended that the court of Alipore which was situated in West Bengal had no jurisdiction to proceed with the suit. The High Court of Calcutta, reversing the order of the Subordinate Judge of Alipore held that the provisions of the Indian Independence (Legal Proceedings) Order, 1947, and the Indian Independence (Rights, Property and Liabili ties)Order, 1947, did not apply to the case and, as the matter was accordingly governed by the rules of internation al law, the court of Alipore had no jurisdiction to proceed with the suit: Held per KANIA C.J., PATANJALI SASTRI, MUKHERJEA and CHANDRASEKHARA AIYAR JJ. (FAZL ALI J. concurrinG) The suit was not one with respect to any property transferred to East Bengal by the Indian Independence (Rights, Property and Liabilities) Order, 1947, nor was it a suit in respect of any "rights" transferred by the said Order, inasmuch as the Province of East Bengal obtained the right to levy income tax not by means of any transfer under the said Order, but by virtue of sovereign rights which were preserved by section 18 (3) of the Indian Independence Act, 1947, and article 12 (2) of the said Order had no application to the case. Held per KANIA C.J., PATANJALI SASTRI, MUKHERJEA AND CHANDRASEKHARA AIYAR J.J. (FAZL ALI J, dissenting.) (i) Since the object of the Indian Independence (Rights, Property and Liabilities) Order, 1947, was to provide for the initial distribution of rights, properties and liabili ties as between the two Dominions and their Provinces, a wide and liberal construction, as far as the language used would admit, should be placed upon the Order, so as to leave no gap or lacuna in relation to the matters sought to be provided for. The words "liability in respect of an action able wrong" should not therefore be understood in the re stricted sense of liability for damages for completed acts, but so as to cover the liability to be restrained by injunc tion from completing what on the allegations in the plaint are illegal or unauthorised acts which have been commenced. As the Province of Bengal was, on the: allegations in the plaint, liable to be restrained from proceeding with an illegal assessment, that liability was, accordingly, a liability in respect of "an actionable wrong other than breach of contract" with in the meaning of article 10 (2) (a) of the above said Order; and, as the cause of action arose wholly in Dacca within the Province of East Bengal, that liability passed to the province of East Bengal under article 10 (2) (a), the latter must be deemed to be substituted as a party to the suit and the suit must continue in the court of the Subordinate Judge of Alipore, under Art.4 of the Indian Independence (Legal Proceedings) Order, 1947. (ii) Assuming that the cause of action did not wholly arise 3 in Decca, article 10 (9.) (c) would apply and the Province of East Bengal would still be liable, though jointly with the Province of West Bengal. (iii) As the suit was not one "to set aside or modify any assessment made under the Act", section 65 of the Bengal Agricultural Income tax Act, 1944, had no application and the suit was therefore one in respect of an "actionable" wrong within the moaning of article 10 (2) (a). Per FAZL ALI J. The words "liability in respect of an actionable wrong other than breach of contract" in article 10 of the Indian Independence (Rights, Property and Liabili ties) order 1947, refer to liability capable of being ascer tained in terms of money such as liability for damages for tort and not liability in any abstract or academic sense. Even if a meaning, as wide ' as they can bear in a legal context, is given to the words "actionable wrong" and "liability" two elements are necessary to constitute an actionable wrong, namely, (i) an act or omission amounting to an infringement of a legal right of a person or breach of duty towards him, and (ii) damage or harm resulting there from. The mere issuing of a notice under section 4 of the Bengal Agricultural Income tax Act, 1944, by the Income tax Officer is not an actionable wrong because no right known to law is infringed thereby and no action for damages can be main tained in respect of such an act, even assuming that the Income tax Officer had exceeded his powers or acted under an invalid provision of law. No "liability for an action able wrong" was thus involved in the suit and no liability in respect of such a wrong could therefore be said to have been transferred to the Province of East Bengal within the meaning of article 10 (2.) of the said Order so as to entitle the plaintiff to continue the suit against the Province of East Bengal under article 10 (2). For the purpose of understanding the full scope of section 65 of the Bengal Agricultural Income tax Act, 1944 it is necessary also to read the latter part which provides that no suit or other proceeding shall lie against any officer of the Crown for anything in good faith done or intended to be done under the Act. " The latter part of the section clearly excludes the jurisdiction of the courts to prevent the Income tax Officer from proceeding with an assessment which has been started and the section must on a fair construction be held to bar all suits in connection with such assessment whether against the State or an Income tax Officer of the State. If, therefore, no suit or action lies, there cab be no liability for an actionable wrong. [The nature of actionable wrongs and torts discussed.] Judgment of the Calcutta High Court reversed.

Civil Appeal No. 59 of 1952. Appeal from the Judgment and Order dated 3rd January, 1952, of the High Court of Judicature at Patna (Ramaswami and Sarjoo Prosad JJ). in an application under article 226 of the Constitution registered as Miscellaneous Judicial Case No. 204 of 1950. Original Petition No. 20 of 1952 under article 32 of the Constitution was also heard along with this appea. P. R. Das (B. Sen, with him) for the appellants. M. C. Setalvad, Attorney General for India, and Mahabir Prasad, Advocate General of Bihar (G. N. Joshi, with them) for the respondents. February 20. The court delivered judgment as follows : PATANJALI SASTRI C. J. I concur in the judgment which my learned brother Mukherjea is about to deliver, but I wish to add a few words in view of the important constitutional issue involved. The facts are simple. The appellants obtained a settlement of about 200 bikhas of land in a village known as Sathi Farm in Bettiah Estate, in Bihar, 1131 then and ever since in the management of the Court of Wards on behalf of the disqualified proprietress who is the second respondent in this appeal. The lands were settled at the prevailing rate of rent but the salami or premium payable was fixed at half the usual rate as a concession to the appellants who are said to be distant relations of the proprietress. The appellants paid the salami and entered into possession of the lands on the 2nd November, 1946, and ' have since been paying the rents regularly. On the 13th June, 1950, the Bihar Legislature passed an Act called the Sathi Lands (Restoration) Act, 1950. The genesis of this legislation is thus explained in the counter affidavit filed on behalf of the State of Bihar, the first respondent herein. Report against the settlement of these lands with the petitioners as well as some other lands to Sri Prajapati Mishra and the unlawful manner in which these settlements were brought about, was carried to the Working Committee of the Indian National Congress, which body, after making such enquiry as it thought fit, came to the conclusion that the settlement of these lands with the petitioners was contrary to the provisions of law and public policy and recommended that steps should be to taken by the State of Bihar to have these lands restored to the Bettiah Estate. In pursuance thereof a request was made to the petitioners and to the said Prajapati Mishra to return the lands to Bettiah Estate. While Sri Prajapati Mishra returned the land settled with him, the petitioners refused to do so. The Statement of Objects and Reasons of the Sathi Lands (Restoration) Bill runs thus: "As it has been held that the settlement of Sathi lands in the District of Champaran under the Court of Wards with Sri Ram Prasad Narayan Sahi and Shri Ram Rekha Prasad Narayan Sahi is contrary to the provisions of the law and as Sri Ram Prasad Narayan Sahi and Sri Ram Rekha Narayan Sahi have refused to return the lands to the Bettiah Estate, Government 1132 have decided to enact a law to restore these lands to the Bettiah Estate." The impugned Act consists of three sections. Section 2(1) declares that "notwithstanding anything contained in any law for the time being in force" ', the settlement obtained by the appellants is "null and void", and that "no party to the settlement or his successor in interest shall be deemed to have acquired any right or incurred any liability thereunder". Sub section (2) provides that the appellants and their successors in interest "shall quit possession of the said land from the date of commencement of this Act and if they fail to do so, the Collector of Champaran shall eject them and restore the lands to the possession of the Bettiah Wards Estate". Subsection (3) provides for the refund of the amount of salami money and the cost of improvement, if any, to the lessees by the estate on restoration to it of the lands in question. In the "case" lodged in this court for the State of Bihar, the legislation is sought to be justified and its validity maintained on the following grounds: " It is well settled that a Legislature with plenary powers so long as it enacts law, within the ambit of its powers, is competent to enact a law which may be applicable generally to society or to an individual or a class of individuals only . It is submitted that grants of the lands belonging to the Bettiah Estate made by the Court of Wards were of doubtful validity; hence they have been dealt with by the impugned Act . No evidence has been adduced by the appellants, except a bare allegation, which has not been substantiated, that about 2000 acres of land were settled to show that persons in similar circumstances with whom similar settlements were made, were treated differently. It is submitted that in the context the impugned Act, has a reasonable basis of classification. " The decision of the majority of this Court in Chiran vs The Union of India(1) is relied on in suport of these contentions, In that case, however, the (1) ; , 1133 majority felt justified in upholding the legislation, though it adversely affected the rights and interest of the shareholders of a particular joint stock company, because the mismanagement of the company 's affairs prejudicially affected the production of an essential commodity and caused serious unemployment amongst a section of the community. Mr. Justice Das and I took the 'view that legislation directed against a particular named person or corporation was obviously discriminatory and could not constitutionally be justified even if such legislation resulted in some benefit to the public. In a system of government by political parties, I was apprehensive of the danger inherent in special enactments which deprive particular named persons of their liberty or property because the Legislature thinks them guilty of misconduct, and I said in my dissenting opinion: "Legislation based upon mismanagement or other misconduct as the differentia and made applicable to a specified individual or corporate body is not far removed from the notorious parliamentary procedure formerly employed in Britain of punishing individual delinquents by passing bills of attainder, and should not, I think receive judicial encouragement. " My apprehensions have come true. Recently we had before us a case from Hyderabad (Civil Appeal ,No. 63 of 1952Ameerunnissa Begum vs Mahboob Begum) ' where the duly constituted legislative authority of that State intervened in a succession dispute between two sets of rival claimants to the estate of a deceased person and " dismissed " the claim of the one and adjudged the Property to the other by making a special " law " to that effect. And now comes this case from Bihar of an essentially similar type. The appellants assert title to certain lands in Bettiah Estate under a settlement which they claim to have lawfully obtained from the Court of Wards, while it is now alleged on behalf of the Estate that the settlement was not for the benefit of the Estate and was contrary to law, as the Court of Wards did not then " apply its (1) Since reported as ; 147 1134 mind " to that question. This is purely a dispute between private parties and a matter for determination by duly constituted courts to which is entrusted, in every free and civilised society, the important function of adjudicating on disputed legal rights, after observing the well established procedural safeguards which include the right to be heard, the right to produce witnesses and so forth. This is the protection which the law guarantees equally to all persons, and our Constitution prohibits by article 14 every State from denying such protection to anyone. The appellants before us have been denied this protection. A political Organization of the party in power decides after making such enquiry as it thought fit, that the settlement in question was " contrary to the provisions of law and public policy " and the State Legislature, basing itself on such decision, purports to declare the settlement " null and void " and directs the eviction of the appellants and the restoration of the lands to the Estate. The reasons given for this extraordinary procedure are indeed remarkable for their disturbing implications. It is said that "there was agitation amongst the tenants of the locality and opposition on the part of persons living in the locality against the appellants ' possession of the lands which led to breach of the peace and institution of criminal cases ". Whenever, then, a section of the people in a locality, in 'assertion of an adverse claim, disturb a person in the quiet enjoyment of his property, the Bihar Government would seem to think that it is not necessary for the police to step in to protect him in his enjoyment until he is evicted in due course of law, but the Legislature could intervene by making a " law " to oust the person from his possession. Legislation such as we have now before us is calculated to drain the vitality from the rule of law which our Constitution so unmistakably proclaims, and it is to be hoped that the democratic process in this country will not function along these lines. MUKHERJEA J. This appeal, which has come before us on a certificate granted by the High Court of 1135 Patna under article 132 (1) of the Constitution, is directed against a judgment of a Division Bench of that court, dated 3rd January, 1952, by which the learned Judges dismissed a petition of the appellants under article 226 of the Constitution. The prayer in the petition was for a writ in the nature of mandamus, directing the opposite party, not to take any action, under an Act passed by the Bihar Legislative Assembly in 1950 and known as The Sathi Lands (Restoration) Act which was challenged as void and unconstitutional. To appreciate the points in controversy between the parties to the proceeding, it may be necessary to narrate the material facts briefly. Maharani Janki Koer, the respondent No. 2 in the appeal, is the present proprietress of an extensive Estate in Bihar known by the name of Bettiah Raj, which is held and managed on her behalf by the Court of Wards, Bihar, constituted under Bengal Act IX of 1879. On 19th July, 1946, the appellants, who are two brothers and are distantly related to the Maharani, made a representation to the Government of Bihar through the Manager of the Estate, praying for settlement in raiyati right, of 200 bighas of land preferably in Sathi farm or Materia farm along with a certain quantity of waste lands. On 20th July, 1946, the then Manager of the Wards Estate wrote a letter to the Collector of Champaran recommending that the applicants might be given settlement of the lands as prayed for, without payment of any selami. The Collector, however, did not. agree to this proposal, nor did the Commissioner of the Tirhut Division, and the matter then came up for consideration before the Board of Revenue which recommended that settlement might be made with the applicants provided they were agreeable to pay selami at half the usual rates. On 14th October, 1946, the recommendation of the Revenue Board was accepted by the Provincial Government and six days later the Court of Wards accepted a cheque for Rs. 5,000 from one of the lessees, towards payment of the selami money and rent for the year 1354 F.S. On the 2nd November, 1946, possession 1136 of the lands was given to the appellants and on the 18th of November following, the Manager of the Court of Wards recorded a formal order fixing the selami of the land at Rs. 3,988 annas odd and rent at Rs. 797 annas odd per year. On the same day, a Hisab Bandobasti form, which is the usual form employed in the Estate for raiyati settlements, was signed by the Circle Officer on behalf of the Court of Wards and by one of the lessees for himself as well as the constituted attorney of the other lessees. It is not disputed that the lessees continued to possess the lands since then on payment of the stipulated rent. On the 3rd June, 1950, the Bihar Legislative Assembly passed an Act known as The Sathi Lands (Restoration) Act which received the assent of the Governor on the 13th June, 1950. The object of the Act, as stated in the preamble, is to provide for restoration of certain lands belonging to the Bettiah Wards Estate which were settled contrary to the provisions of law in favour of certain individuals. Section 2, which is the only material section in the Act, enacts in the first sub section that the settlement of Sathi lands (described in the schedule to the Act) on behalf of the Bettiah Court of Wards Estate with the appellants, as per order of the Manager of the Estate dated the 18th November, 1946, is declared null and void and no party to the settlement ,or his successor in interest shall be deemed to have acquired any right or incur any liability under the same. The second sub section embodies a direction to the effect that the said lessees and their successor in interest shall quit possession of the lands from the date of the commencement of the Act and if they fail to do so, the Collector of Champaran shall eject them and restore the lands to the possession of the Bettiah Estate. The third and the last sub section provides that the Bettiah Wards Estate shall on restoration to it of the lands pay to the lessees the selami money paid by them and also such amount as might have been spent by them in making improvements on the lands prior to the commencement of the Act. 1137 In substance, therefore, the Act declared the lease granted by the Bettiah Wards Estate to the appellants on the 18th November, 1946, to be illegal and inoperative and prescribed the mode in which this declaration was to be given effect to and the lessees evicted from the lands. On the 28th August, 1950, the appellants filed the petition, out of which this appeal arises, under article 226 of the Constitution in the High Court of Patna, challenging the validity of The Sathi Lands Act and praying for a writ upon the respondents restraining them from taking any steps under the said Act, or from interfering with the possession of the appellants in respect of the lands comprised in the lease. It was asserted by the petitioners that in passing the impugned legislation the Bihar Legislature actually usurped the power of the judiciary and the enactment was not a law at all in the proper sense of the expression. The other material contentions raised were that the legislation was void as it conflicted with the fundamental rights of the petitioners guaranteed under articles 14, 19(1) (f) and 31 of the Constitution. The respondents opposite parties in resisting the petitioners ' prayer stated inter alia in their counter affidavit that the settlement of the lands in question with the appellants by the Court of Wards, was not for the benefit of the estate or advantage of the ward and that the transaction was entered into by the Wards Estate without properly applying their mind to it. It was stated further that after the settlement was made, there was a good deal of agitation among the tenants in the locality which led to the institution of certain criminal proceedings. In these circumstances, the matter was brought to the notice of the Working Committee of the Indian National Congress and the Working Committee was of opinion that the settlement of these lands was against public interest. The lessees, therefore, were asked to vacate the lands and on their refusal the legislation in question was passed. The petition was heard by a Division Bench consisting of Ramaswami and Sarjoo Pershad JJ. Ramaswami J. 1138 decided all the points raised by the petitioners against them and held that the Act was neither ultra vires the Bihar Legislature nor was void under article 13(1) of the Constitution. The learned Judge was further of opinion that it was not a fit case for interference by the High Court under article 226 of the Constitution. The other learned Judge expressed considerable doubts as to whether a legislation of this type, which in form and substance was a decree of a court of law, was within the competence of the legislature and warranted by the Constitution. He agreed, however, with his learned colleague that the case was not such as to justify an interference of the High Court in exercise of its discretionary powers under article 226 of the Constitution. The remedy of the petitioners might lie, according to him, in a regularly constituted suit. The result, therefore, was that the appellants ' petition was dismissed and it is the propriety of this judgment that has been assailed before us in this appeal. Mr. P. R. Das, who appeared in support of the appeal, put forward at the forefront of his arguments, the contention raised on behalf of his client in the court below that the impugned legislation was void by reason of its violating the fundamental rights of the appellants under article 14 of the Constitution. The point appeared to us to be of substance and after hearing the learned Attorney General on this point we were satisfied that the contention of Mr. Das was well founded and entitled to prevail, irrespective of any other ground that might be raised in this appeal. There have been a number of decisions by this court where the question regarding the nature and scope of the guarantee implied in the equal protection clause of the Constitution came up for consideration and the general principles can be taken to be fairly well settled. What this clause aims at is to strike down hostile discrimination or oppression or inequality. As the guarantee applies to all persons similarly situated, it is certainly open to the legislature to classify persons and things to achieve particular legislative objects; 1139 but such selection or differentiation must not be arbitrary and should rest upon a rational basis, having regard to the object which the legislature has in view. It cannot be disputed that the legislation in the present case has singled out two individuals and one solitary transaction entered into between them and another private party, namely, the Bettiah Wards Estate and has declared the transaction to be a nullity on the ground that it is contrary to the provisions of law, although there has been no adjudication on this point by any judicial tribunal. It is not necessary for our present purpose to embark upon a discussion as to how far the doctrine of 'separation of powers has been recognised in our Constitution and whether the legislature can arrogate to itself the powers of the judiciary and proceed to decide disputes between private parties by making a declaration of the rights of one against the other. It is also unnecessary to attempt to specify the limits within which any legislation, dealing with private rights, is possible within the purview of our Constitution. On one point our Constitution is clear and explicit, namely, that no law is valid which takes away or abridges the fundamental rights guaranteed under Part III of the Constitution. There can be no question, therefore, that if the legislation in the present case comes within the mischief of article 14 of the Constitution, it has got to be declared invalid. This leads us to the question as to whether the impugned enactment is, in fact, discriminatory and if So, whether the discrimination made by it can be justified on any principle of reasonable classification ? The appellants, it is not disputed, are only two amongst numerous leaseholders who hold lands in raiyati right under the Bettiah Wards Estate. It cannot also be disputed that the lands were settled with them on the recommendation of the Board of Revenue after due consideration of the respective views put forward by the Manager of the Estate on the one hand and the Collector and the Divisional Commissioner on the other. The appellants are admittedly paying rents which are normally assessed on lands of similar 1140 description in the locality. The learned AttorneyGeneral referred in this connection to the provisions of section 18 of the Court of Wards Act and argued that the lease in dispute was granted in contravention of that section. Section 18 of the Court of Wards Act provides as follows: "The Court may sanction the giving of leases or farms of any property under its charge . and may direct the doing of all such other acts as it may judge to be most for the benefit of the property and the advantage of the Ward". Apparently it makes the Court of Wards the sole judge of the benefit to the estate or advantage of the ward. But it is said that the Court of Wards did not apply its mind properly to this matter when it granted lease to the appellants at half the usual rate of selami. The Wards Estate thus suffered loss to the extent of nearly Rs. 4,000 which could legitimately have been recovered from any other lessee. This contention does not impress us much; the utmost that can be said is that this could have been put forward, for what it is worth and with what result, nobody can say, as a ground for setting aside the lease in a court of law. But that is not the question which is relevant for our present purpose at all; we were not called upon to decide whether or not the lease was a proper one or beneficial to the estate. The question for our decision is, whether the statute contains discriminatory provisions so far as the appellants are concerned and if so, whether these discriminations could be reasonably justified ? It is clearly stated in paragraph 9 of the affidavit made by the appellants in support of their petition that there are numerous other persons to whom leases on similar terms were granted by the Bettiah Wards Estate. Clauses (b), (c) and (d) of paragraph 9 of the affidavit stand thus: "(b) In this long course of management by tile Court of Wards, leases or settlement of lands used to be made without any selami on proper rent. This state of affairs continued down to recent times during 1141 which period thousands of bighas were so settled with numerous persons; (c) in 1945 the authorities decided to make settlements on large scale with war returned soldiers on a selami equal to 5 times the average rent prevailing in the locality for similar lands; (d) in 1946, 1947, 1948 and 1949 a good number of settlements covering about 2000 acres of lands were settled on the basis of IO years ' rental obtaining in the locality and in some cases for good reasons, at five years ' rental." In paragraph 12 of the counter affidavit put in on behalf of the respondents, these statements are not denied. In fact, they are admitted and the only thing said is, that these leases were granted in due course of management. Ramaswami J. has dismissed this part of the case by simply remarking that no details of these settlements were furnished by the appellants; but no details were at all necessary when the correctness of the statements was not challenged by the respondents. It will be interesting to note that the respondents themselves in paragraph 10 of their counter affidavit mentioned the name of Shri Prajapati Mishra as one of the persons with whom similar settlement of lands was made by the Bettiah Estate. It is stated in that paragraph that the cases of the appellants as well as of Prajapati Mishra were brought to the notice of the Working Committee of the Indian National Congress and the Committee came to the conclusion that both the settlements were contrary to the provisions of law. Thereupon a request was made to both these sets of lessees to restore their lands to the Estate, but whereas Prajapati Mishra returned his lands to the Bettiah Estate, the appellants refused to do so. In reply to this statement, the appellants stated in their rejoinder that the said Prajapati Mishra did not vacate the land,% but created a trust in respect of the same, he being the chairman of the board Of trustees and the lands were still in possession of the board of trustees. Strangely, as it seems, the State of Bihar raked up this matter again in a 148 1142 further affidavit where it was admitted that the said Prajapati Mishra did execute a trust and that the trustees took possession of the property. It was stated, however, that Prajapati Mishra, who was one of the trustees, did actually surrender the lands in two installments but the other trustees did not, and hence legal advice was being taken to find out ways and means of recovering the property from them. The whole thing smacks of disingenuousness and the State of Bihar, it seems, was not well advised in rely ing upon facts like these in their attempt to repel the appellants ' attack on the legislation on the ground of discrimination. Be that as it may, there is no doubt that the appellants were not the only lessees under the Bettiah Estate who got settlement of lands at a selami of five years ' rental. On the sworn statements of the appellants, which are not challenged by the other side, it appears that there are numerous persons occupying the same position as the appellants, who however were not subjected to this expropriatory legislation. But the vice in this legislation goes much deeper than this. It is not merely a question of treating the appellants differently from the other lessees under the Wards Estate, with whom settlements of land have been made on similar or identical terms. If a lease has been given by a Court of Wards, which is not for the benefit of the estate or advantage of the ward, it is for a court of ,law to decide whether it is warranted by the terms of the Court of Wards Act. If the lessor proceeds to cancel the lease, the lessee has a legal right to defend his claim and satisfy the court that the lease is not in contravention of law. If, on the other hand, the lessee is actually dispossessed, he has a right to sue in court for recovery of possession of the property on establishing that he has been illegally turned out. The dispute here, is a legal dispute pure and simple between two private parties. What the Legislature has done is to single out these two individuals and deny them the right which every Indian citizen possesses to have his rights adju dicated upon by a judicial tribunal in accordance with 1143 the law which applies to his case. The meanest of citizens has a right of access to a court of law for the redress of his just grievances and it is of this right that the appellants have been deprived by this Act. It is impossible to conceive of a worse form of discrimination than the one which differentiates a particular individual from all his fellow subjects and visits him with a disability which is not imposed upon anybody else and against which even the right of complaint is taken away. The learned Attorney General, who placed his case with his usual fairness and ability, could not put forward any convincing or satisfactory reason upon which this legislation could be justified. It is true that the presumption is in favour of the constitutionality of a legislative enactment and it has to be presumed that a Legislature understands and correctly appreciates the needs of its own people. But when on the face of a statute there is no classification at all, and no attempt has been made to select any individual or group with reference to any differentiating attribute peculiar to that individual or group and not possessed by others, this presumption is of little or no assistance. to the State. We may repeat with profit what was said by Mr. Justice Brewer in Gulf Colorado etc. Co. vs Ellis(1) that "to carry the presumption to the extent of holding that there must be some undisclosed and unknown reason for subjecting certain" individuals or corporations to hostile and discriminatory legislation is to make the protection clauses of the Fourteenth Amendment a mere rope of sand". In our opinion, the present case comes directly within the principle enunciated by this court in Ameerunnissa, Begum vs Mahboob Begum(2 ). The result is that we allow the appeal and set aside the judgment of the High Court. A writ in the nature of mandamus shall issue directing the respondents not to take any steps in pursuance of The Sathi Lands (Restoration) Act of 1950 or to interfere with the possession of the appellants in respect to the lands (1) 165 U section 150. (2) [1953] S.C.R 404. 1144 comprised in the lease referred to in that Act. The appellants will have their costs in both courts. VIVIAN BOSE J. I am in entire agreement with my Lord the Chief Justice and with my learned brother Mukherjea. GHULAM HASAN J. I agree with my Lord the Chief Justice and with my brother Mukherjea. BHAGWATI J. I entirely agree with the judgment just delivered by my Lord the Chief Justice and my brother Mukherjea and there is nothing which I can usefully add. Appeal allowed.

The Court of Wards granted to the appellants a large area of land belonging to the Bettiah Raj which was then under the management of the Court of Wards, on the recommendation of the Board of Revenue, at half the usual rates. A few years later, the Working Committee of the Indian National Congress expressed the opinion that the settlement of the lands was against public interest, and in 1950, the Bihar Legislature passed an Act called the Sathi Lands (Restoration) Act, 1950, which declared that, notwithstanding anything contained in any law for the time being in force the settlement granted to the appellants shall be null and void and that no party to the settlement or his successors in interest shall be deemed to have acquired any right or incurred any liability thereunder, and empowered the Collector to eject the appellants if they refused to restore the lands. The appellants, alleging that the Act was unconstitutional, applied under article 226 of the Constitution for a writ of mandamus against the State of Bihar restraining it from taking any action under the Act. It was found that there were several other settlements of lands belonging to the Bettiah Raj on similar terms against which the Government had taken no action: Held, that the dispute between the appellants and the State was really a private dispute and a matter to be determined by a judicial tribunal in accordance with the law applicable to the case, and, as the Legislature had, in passing the impugned enactment singled out the appellants and deprived them of their right to 1130 have this dispute adjudicated upon by a duly constituted Court, the enactment contravened the provisions of article 14 of the Constitution which guarantees to every citizen the equal protection of the laws, and was void. Legislation which singles out a particular individual from his fellow subjects and visits him with a disability which is not imposed upon the others and against which even the right of complaint is taken away is highly discriminatory. Though the presumption is in favour of the constitutionality of a legislative enactment and it has to be presumed that a Legislature understands and correctly appreciates the needs of its own people, yet when on the face of a statute there is no classification at all, and no attempt has been made to select any individual or group with reference to any differentiating attribute peculiar to that individual or group and not possessed by others, this presumption is of little or no assistance to the State. Ameerunnissa Begum vs Mahboob Begum ; and Gulf of Colorado etc. Co. vs Ellis ; referred to.

No. 224 of 1959. Appeal from the judgment and decree dated August 28, 1956, of the Madhya Pradesh High Court in F.A. No. 90 of 1949. A. V. Viswanatha Sastri, section N. Andley, Rameshwar Nath and P.L. Vohra, for the appellant. section T. Desai, R. Ganapathy Iyer and K. L. Hathi, for the respondent. January 15 The Judgment of the Court was delivered by section K. DAS, J. This is an appeal on a certificate granted by the High Court of Madhya Pradesh under article 133 (1) (a) of the Constitution, The appellant is Mithoolal Nayak, who took an assignment on october 18, 1945 of a life insurance policy on the life of one Mahajan Deolal for a sum of Rs. 25,000/ in circumstances which we shall presently state. Mahajan Deolal died on November 12, 1946 573 Thereafter, the appellant made a demand against the respondent company for a sum of Rs. 26,000/ and odd on the basis of the life insurance policy which had been assigned to him. This claim or demand of the appellant was repudiated by the respondent company by a letter dated October 10, 1947, which in substance stated that the insured Mahajan Deolal had been guilty of deliberate mis statements and fraudulent suppression of material information in answers to questions in the proposal form and the personal statement, which formed the basis of the contract between the insurer and the insured. On the repudiation of his claim the appellant brought the suit out of which this appeal has arisen. The suit was originally instituted against the oriental Government Security Life Assurance co. Ltd., Bombay, which issued the policy in favour of Mahajan Deolal on March 13, 1945. Latter, on the passing of the life Insurance corporation Act, 1956, there was a statutory transfer of the assets and liabilities of the controlled (life) business of all insurance companies and insurers operating in India to a Corporation known as the Life Insurance Corporation of India. By an order of this Court made on February 16, 1960, the said Corporation was substituted in place of the original respondent. For brevity as convenience we shall ignore the distinction between the original respondent and the said Corporation and refer to the respondent in this judgment as the respondent company. The Suit was decreed by the learned Additional District Judgment of Jabalpur by his judgment dated May 7, 1949. The respondent company then preferred an appeal to the High Court of Madhya Pradesh. This appeal was heard by a Division Bench of the said High Court and by a judgment dated August 28, 1956, the appeal was allowed and the suit was dismissed with costs. It is from 574 that appellate judgment and decree that the present appeal has been brought to this Court. We now proceed to state some of the relevant facts relating to the appeal and the contentions urged on behalf of the appellant. Mahajan Deolal was a resident of. village Singhpur, Tehsil Narsinghpur. It appears that he was a small landholder and possessed several acres of land. Sometime in December, 1942, Mahajan Deolal submitted a proposal through one Rahatullah Khan, an agent of the respondent company at Narsingpur, for the insurance of his life with the respondent company for a sum of Rs. 10,000/ only. Mahajan Deolal 's age at that time was about 45 as stated by him. In the proposal form which was submitted to the respondent company, Mahajan Deolal mentioned the name of one Motilal Nayak, by profession a doctor, as a personal friend who best knew the state of the health and habits etc. of the insured. This Motilal Nayak, be it noted, is a brother of the appellant, the evidence in the record showing that the two brothers lived together in the same house. When the proposal for insurance of his life was made by Mahajan Deolal in December 1942, he was examined by a doctor named Dr. D. D. Desai. This doctor submitted two reports about Mahajan Deolal; one report, it appears, was admitted with the proposal form through the agent of the respondent company; another report was sent in a confidential cover along with a letter from the doctor. In this letter (exhibit D 22) the doctor explained why he was submitting two medical reports. In substance he said that the report submitted with the proposal form at the instance of the agent, Rahatullah Khan, was not a correct report and the correct report was the one which he enclosed in the confidential cover. In that report Dr. Desai said that Mahajan Deolal 575 was anaemic, looked about 55 years old, had a dilated heart and his right lung showed indications of an old attack of pneumonia or pleurisy. The doctor further said that the general health of Mahajan Deolal was very much run down and he was a total physical wreck. The doctor opined that Mahajan Deolal ' life was an uninsurable life. It appears that nothing came out of the proposal made by Mahajan Deolal for the insurance of his life in December, 1942. The evidence of the Inspector of the respondent company shows that on receipt of Dr. Desai 's reports, the respondent company directed that Mahajan Deolal should be further examined by the Civil Surgeon, Hoshangabad and District Medical officer, Railways at Jabalpur. Mahajan Deolal could not, however, be examined by the two doctors aforesaid and according to the rules of the respondent company the proposal lapsed on the expiry of six months for want of completion of the medical examination as required by the respondent company. Then, on July 16, 1944, a second proposal was made through the same agent of the respondent company for the insurance of the life of Mahajan Deolal, this time for a sum of Rs. 25,000/ . The Inspector of the respondent company said in his evidence that this second proposal was made at the instance of the same agent, Rahatullah Khan inasmuch as the proposal of 1942 had not been rejected but had only lapsed. It appears that at the time of the first proposal in 1942 Mahajan Deolal had paid a sum of Rs. 571/ and odd towards the first premium due in case the proposal was accepted. In the personal statement, accompanying the second proposal of July 16, 1944, it was stated that an earlier proposal for insuring the life of Mahajan Deolal was pending with the respondent company. Now, in the proposal form (exhibit D 11) there was a question (question No. 13) to the following effect: 576 "Have you within the past five years consulted any medical man for any ailment, not necessarily confining you to your house? If so, give details and state names and addresses of medical man consulted. " The answer given to the question was "No". This answer, according to the case of the respondent, was false and deliberately false. because, according to the evidence of one Dr. P.N Lakshmanan, Consulting Physician at Jabalpur, Mahajan Deolal was examined and treated by the said doctor between the dates September 7, 1943, and October 6, 1943, when the doctor found that Mahajan Deolal was suffering from anaemia, oedema of the feet, diarrhoea and panting on exertion. We shall advert in greater detail to the evidence of Dr. Lakshmanan at a later stage. In his personal statement accompanying the second proposal Mahajan Deolal answered in the negative question 12(b), the question being as to when he was last under medical treatment and for what ailment and how long. In the same personal statement with regard to questions, for example, question nos. 5(a); 5(b) etc., as to whether he suffered from shortness of breath, anaemia, asthma etc, Mahajan Deolal gave negative answers. The contention on behalf of the respondent company was that these answers in the personal statement were also deliberately false and constituted a fraudulent suppression of material particulars relating to the health of the insured. With regard to the second proposal and the personal statement accompanying it, Dr. Motilal Nayak, brother of the appellant, gave a friend 's report, in which he said that Mahajan Deolal health was good and that he had never heard that Mohajan Deolal suffered from any illness. It is worthy of note here that Dr. Motilal Nayak himself took Mahajan Deolal to Dr. Lakshmanan for treatment at Jabalpur in September October., 1943. On receipt 577 of the second proposal in July, 1944, Mahajan Deolal was examined by Dr. Kapadia, who was the District Medical officer of the Railways at Jabalpur. Dr. Kapadia reported that Mahajan Deolal was a healthy man and looked about 52 to 54 years old. He recommended that Mahajan Deolal might be given a policy of fourteen years. In his report Dr. Kapadia noted that Mahajan Deolal had stated that he had suffered from pneurnonia four or five years ago, and that he had also cholera some years ago. No mention, however, was made of anaemia, asthma, shortness of breath etc. On December 29, 1944, Mahajan Deolal made a further declaration of his good health and so also on February 12, 1945. On March 13, 1945, the policy was issued by the respondent company. It contained the usual terms of such life insurance policies, one of which was that in case it would appear that any untrue or incorrect averment had been made in the proposal form or personal statement, the policy would be void. The first premium due on the policy was taken from the amount which was already in deposit with the respondent company in connection with the proposal made in 1942. Then, on May 22, 1945, Mahajan Deolal wrote a letter to the respondent company in which he said that his financial condition had become suddenly worse and that he would not be able to pay the premium for the policy. He requested that the policy be cancelled. In the meantime the premium for 1945 not having been paid, the policy lapsed. Then, on October 28, 1945, Mahajan Deolal made a request for revival of the policy, but a few days before that, namely on October 18, 1945, the policy was assigned in favour of the appellant, by an endorsement made on the policy itself. This assignment was duly registered by the respondent company by means of its letter dated November 1, 1945 in which the respondent company said that it accepted the assignment without expressing any opinion as to its validity or 578 effect. The respondent company also made an enquiry from the appellant as to whether the latter had any insurable interest in the life of the insured and what consideration had passed from him to the insured. To this the appellant replied that he had no insurable interest in the life of Mahajan Deolal except that the latter was a friend and he (the appellant) had purchased the policy for a sum of Rs. 427.12 nP. being the premium paid by him so far, because Mahajan Deolal did not with to continue the policy. On his request for a revival of the policy Mahajan Deolal was again medically examined, this time by one Dr. Belapurkar. Later on February 25, 1946, he was examined by Dr. Clarke. The policy was then revived on payment of all arrears of premium, these arrears having been paid by the present appellant. On receipt of the revival fee, the policy appears to have been revived some time in July, 1946. We have already stated that Mahajan Deolal died in November, 1946. The certificate of Dr. Clarke, who was the medical attendant at the time when Mahajan Deolal died, showed that the primary, cause of death of Mahajan Deolal was malaria followed by severe type of diarrhoea; the secondary cause was anaemia, chronic bronchitis and enlargement of liver. In the certificate which Dr. Clarke gave there was mention of certain other medical practitioners who had attended Mahajan Deolal at the time of his death. One of such medical practitioners mentioned in the certificate was Dr. Lakshmanan. On receipt of this certificate the respondent company got into touch with Dr. Lakshmanan and discovered from him that Mahajan Deolal had been treated in September October, 1943, by Dr. Lakshmanan for ailments which, according to the doctor, were of a serious nature. Several issues were tried between the parties in the trial court. But the four questions which 579 were argued in the High Court and on which the fate of the appeal depends were these: (1) Whether the policy was vitiated by fraudulent suppression of material facts by Mahajan Deolal ? (2) Whether the present appellant had no insurable interest in the life of the insured, and if so, can he sue on the policy ? (3) Whether the respondent company had issued the policy with full knowledge of the facts relating to the health of the insured and if so, is it estopped from contesting the validity of the policy ? and (4) Whether in any event the appellant is entitled to refund of the money he had paid to the respondent company ? These are the four questions which have been agitated before us and we shall deal with such of them as are necessary for deciding this appeal. So far as the first question is concerned, the learned trial Judge found that though Mahajan. Deolal had given a negative answer to question no, 13 in the proposal form and to questions nos. 5(a), 5(b), 5 (f) and 12(b) in the personal statement, these answers though not strictly accurate, furnished no grounds for repudiating the claim of the appellant by the respondent company, in as much as s.45 of the (4 of 1938) applied and the answers did not amount to a fraudulent suppression of material facts by the policy holder within the meaning of that section. The learned trial Judge found that the ailments for which Dr. Lakshmanan treated Mahajan Deolal in September October, 1943, were of a causal or trivial nature and the failure of the policy holder to disclose those ailments did not attract the second part of 580 section 45 of the . The High Court came to a contrary conclusion and held that even applying section 45 of the , the policy holder was guilty of a fraudulent suppression of material facts relating to his health within the meaning of that section and the respondent company was entitled to avoid the contract on that ground. On behalf of the appellant it has been argued before us that the finding of the learned trial Judge on this question was the correct finding and that the High Court was wrong in arriving at a contrary finding on this question in view of the evidence given in the case. The judgment of the High Court is a judgment in reversal and the appellant has a right of appeal under article 133(1)(a) of the Constitution in as much as the value of the subject matter of the dispute in the court of first instance and still in dispute is more than Rs. 20,000/ . We have, therefore, allowed learned counsel for the parties to take us through the evidence in the case. On a consideration of that evidence we have come to the conclusion that the finding of the High Court is the correct finding. We shall presently consider the evidence, but it may be advantageous to read first section 45 of the , as it stood at the relevant time. The section, so far as it is relevant for our purpose, is in these terms: "No policy of life insurance effected before the commencement of this Act shall after the expiry of two years from the date of commencement of this Act and no policy of life insurance effected after the coming into force of this Act shall, after the expiry of two years from the date on which it was effected, be called in question by an insurer on the ground that a statement made in the proposal for insurance or in any report of a medical officer, or referee, or friend of the insured, or in any other document leading to 581 the issue of the policy, was inaccurate or false, unless the insurer shows that such statement was on a material matter or suppressed facts which it was material to disclose and that it was fraudulently made by the policy holder and that the policy holder knew at the time of making it that the statement was false or that it suppressed facts which it was material to disclose. x x x x x x" It would be noticed that the operating part of section 45 states in effect (so far as is relevant for our purpose) that no policy of life insurance effected after the coming into force of the Act shall, after the expiry of two years from the date on which it was effected, be called in question by an insurer on the ground that a statement made in the proposal for insurance or in any report of a medical officer, or referee, or friend of the insured, or in any other document leading to the issue of the policy, was inaccurate or false; the second part of the section is in the nature of a proviso which creates an exception. It says in effect that if the insurer shows that such statement was on a material matter or suppressed facts which it was material to disclose and that it was fraudulently made by the policyholder and that the policy holder knew at the time of making it that the statement was false or that it suppressed facts which it was material to disclose, then the insurer can call in question the policy effected as a result of such inaccurate or false statement. In the case before us the policy was issued on March 13, 1945, and it was to come into effect from January 15, 1945. The amount insured was payable after January 15, 1968, or at the death of the insured, if earlier. The respondent company repudiated the claim by its letter dated October 10, 1947. Obviously, therefore, two years had expired from the date on which the policy was effected. We are clearly of the opinion that section 45 of the applies in the present case in 582 view of the clear terms in which the section is worded, though learned counsel for the respondent company sought, at one stage, to argue that the revival of the policy some time in July, 1946, constituted in law a new contract between the parties and if two years were to be counted from July, 1946, then the period of two years had not expired from the date of the revival. Whether the revival of a lapsed policy constitutes a new contract or not for other purposes, it is clear from the wording of the operative part of section 45 that the period of two years for the purpose of the section has to be calculated from the date on which the policy was originally effected; in the present case this can only mean the date on which the policy (exhibit P 2) was effected. From that date a period of two years had clearly expired when the respondent company repudiated the claim. As we think that section 45 of the applies in the present case, we are relieved of the task of examining the legal position that would follow as a result of inaccurate statements made by the insured in the proposal form or the personal statement etc. in a case where section 45 does not apply and where the averments made in the proposal form and in the personal statement are made the basis of the contract. The three conditions for the application of the second part of section 45 are (a) the statement must be on a material matter or must suppress facts which it was material to disclose; (b) the suppression must be fraudulently made by the policy holder; and (c) the policy holder must have known at the time of making the statement that it was false or that it suppressed facts which it was material to disclose. The crucial question before us is whether these three conditions were fulfilled in the present 583 case. We think that they were. We are unable to agree with the learned trial Judge that the ailments for which Mahajan Deohal was treated by Dr. Lakshmanan in September October, 1943, were trivial or casual ailments. Nor do we think that Mahajan Deolal was likely to forget in July, 1944, that he had been treated by Dr. Lakshmanan for certain serious ailments only a few months before that date. This brings us to a consideration of the evidence of Dr. Lakshmanan. That evidence is clear and unequivocal. Dr. Lakshmanan says that Dr. Motilal Nayak brought the patient to him at Jabalpur. We have already referred to the fact that Dr. Motilal Nayak had himself made a false statement in his friend 's report dated July 17, 1944, when he said that he had never heard that the insured had suffered from any illness. It is impossible to believe that Dr. Motilal Nayak would not remember that he had himself taken the insured to Jabalpur for treatment by Dr. Lakshmanan who was an experienced consulting physician. Dr. Lakshmanan said that when he first examined Mahajan Deolal on September 7, 1943, he found that his condition was serious as a result of the impoverished condition of his blood, and that Mahajan Deolal was suffering from anaemia, oedema of the feet, diarrhoea and panting on exertion. The doctor asked for an examination of the blood. The pathological report supported the diagnosis that Mahajan Deolal was suffering from secondary anaemia meaning thereby that anaemia was due to lack of iron and malnutrition. Dr. Lakshmanan further found that from the symptoms disclosed the disease was a major one. Mahajan Deolal had also cardiac asthma which was a symptom of anaemia and due to dilatation of heart. Dr. Lakshmanan saw the patient again on September 9, 1943, and then again on September 16, 1943. On October 6, 1943 Mahajan Deolal himself went to Dr. Lakshmana. On that date Dr. Lakshmanan found that 584 anaemia had very greatly disappeared. In cross examination Dr. Lakshmanan admitted that the anaemia, dilatation of heart and cardiac asthma from which Mahajan Deolal was suffering continued a passing phase which might disappear by treatment. He further admitted that he did not mention cardiac asthma in his letter addressed to the respondent company. We have given our very earnest consideration to the evidence of Dr. Lakshmanan and we are unable to hold that the ailments from which Mahajan Deolal was then suffering were either trivial or casual in nature. The ailments were serious though amenable to treatment. Mahajan Deolal 's son gave evidence in the case and he said in his evidence that though Dr. Lakshmanan prescribed some medicine, his father did not take it. He further said that his father was a strict vegetarian. This evidence was given by the son with regard to what the doctor had said that he prescribed fresh liver juice made at home according to his directions three times a day. He also prescribed iron sulphate in tablet from with plenty of water. The son further said that during his stay at Jabalpur his father felt weakness, though he used to move about freely and was never confined to bed. The son tried to make it appear in his evidence that his father was suffering from nothing serious. Dr. Lakshmanan said in his evidence that his fees for visiting a patient at Jabalpur were Rs. 16/ per visit. We agree with the High Court that if Mahajan Deolal was not suffering from any serious ailment, he would not have been taken by his physician, Dr. Motilal Nayak from his village to Jabalpur nor would he have consulted Dr. Lakshmanan, a consulting physician of repute, for so many days on payment of Rs. 16/ per visit. No doubt, Mahajan Deolal 's son now tries to make light of the illness of his father but Dr. Lakshmanan 's evidence shows elearly enough that in September October, 1943. Mahajan 585 Deolal was suffering from a serious type of anaemia for which he was treated by Dr. Lakshmanan. Mahajan Deolal could not have forgotten in July, 1944, that he was so treated only a few months earlier and furthermore, Mahajan Deolal must have known that it was material to disclose this fact to the respondent company. In his answer to the questions put to him he not only failed to disclose what it was material for him to disclose, but he made a false statement to the effect that he had not been treated by any doctor for any such serious ailment as anaemia or shortness of breath or asthma. In other words, there was a deliberate suppression fraudulently made by Mahajan Deolal. Fraud, according to section 17 of the (IX of 1872), means and includes Inter alia any of the following acts committed by a party to a contract with intent to deceive another party or to induce him to enter into a contract (1) the suggestion, as to a fact, of that which is not true by one who does not believe it to be true; and (2) the active concealment of a fact by one having knowledge or belief of the fact. Judged by the standard laid down in section 17, Mahajan Deolal was clearly guilty of a fraudulent suppression of material facts when he made his statements on July 16, 1944, statements which he must have known were deliberately false. Therefore, we are in agreement with the High Court in answering the first question against the appellant. We may here dispose of the third question. Learned counsel for the appellant has argued before us that Mahajan Deolal was examined under the direction of the respondent company by as many as four doctors, namely, Dr. Desai, Dr. Kapadia, Dr. Belapurkar and Dr. Clarke. It is further pointed out that Mahajan Deolal had correctly 586 disclosed that he had suffered previously from malaria, pneumonia and cholera. Dr. Kapadia, it is pointed out, was specifically asked to examine Mahajan Deolal in view of the conflicting reports which Dr. Desai had earlier submitted. On these facts, the argument has been that the respondent company had full knowledge of all facts relevant to the state of health of Mahajan Deolal and having knowledge of the full facts, it was not open to the respondent company to call the policy in question on the basis of the answers given by Mahajan Deolal in the proposal form and the personal statement, even though those answers were inaccurate. Learned counsel for the appellant has referred us to the Explanation to section 19 of the in support of his argument. We are unable to accept this argument as correct. It is indeed true that Mahajan Deolal was examined by as many as four doctors. It is also true that the respondent company had before it the conflicting reports of Dr. Desai and it specially asked Dr. Kapadia to examine Mahajan Deolal in view of the reports submitted by Dr. Desai. Yet, it must be pointed out that the respondent company had no means of knowing that Mahajan Deolal had been treated for the serious ailment of secondary anaemia followed by dilatation of heart etc. in September October, 1943 by Dr. Lakshmanan. Nor can it be said that if the respondent company had knowledge of those facts, they would not have made any difference. The principle underlying the Explanation to section 19 of the Contract Act is that a false representation, whether fraudulent or innocent is irrelevant if it has not induced the party to whom it is made to act upon it by entering into a contract. We do not think that principle applies in the present case. The terms of the policy make it clear that the averments made as to the state of health of the insured in the proposal form and the personal statement were the basis of the contract between the 587 parties, and the circumstance that Mahajan Deolal had taken paint to falsify or conceal that he had been treated for a serious ailment by Dr. Lakshmanan only a few months before the policy was taken shows that the falsification or concealment had an important bearing in obtaining the other party 's consent. A man who has so acted cannot after wards turn round and say; "It could have made no difference if you had known the truth. " In our opinion, no question of waiver arises in the circumstances of this case, nor can the appellant take advantage of the Explanation to section 19 of the . Our finding on the first question makes it unnecessary for us to decide the second question, namely, whether the present appellant merely gambled on the life of Mahajan Deolal when he took the assignment on October 18, 1945. The contention of the respondent company was that appellant had no insurable interest in the life of Mahajan Deolal and when he took the assignment of the policy on October 18, 1945 he was merely indulging in a gamble on Mahajan Deolal 's life; the contract was therefore, void by reason of section 30 of the . On behalf of the appellant, however, the contention was that section 38 of the insurance Act provided a complete code for assignment and transfer of insurance policies and the assignment made in favour of the appellant by Mahajan Deolal was a valid assignment in accordance with the provisions of section 38 aforesaid. The High Court, it appears, proceeded on the footing that from the very inception the policy was taken for the benefit of the appellant on the basis of a gamble on the life of Mahajan Deolal; it said that the appellant and his brother, Dr. Motilal Nayak, knew very well that Mahajan Deolal was not likely to live very long and when the policy was taken out in 1944, it was really for the benefit of the present appellant, who soon after took an assignment 588 on payment of the premium already paid by Mahajan Deolal and such arrears of premium as were then outstanding. It is unnecessary for us to give our decision on these contentions; because if Mahajan Deolal was himself guilty of a fraudulent suppression of material facts on which the respondent company was discharged from performing its part of the contract, the appellant who holds an assignment of the policy cannot stand on a better footing than Mahajan Deolal himself. It was argued before us that is the policy was valid in its inception, that is to say, if it was in fact effected for the use and benefit of Mahajan Deolal, who undoubtedly had an insurable interest in his own life, it could not afterwards be invalidated by assignment to a person who had no interest but who merely took it as a speculation. Our attention was drawn to several decisions on this question, American and English, noticed in para 502 of MacGillivray on Insurance law (fourth Edition). We consider it unnecessary to examine those decisions or to go into the question posed therein. That question must be left to be determined in a case where it properly arises. As we have stated earlier, on our conclusion on the first question, the appellant is clearly out of Court and can not claim the benefit of a contract which had been entered into as a result of a fraudulent suppression of material facts by Mahajan Deolal. This brings us to the last question, namely, whether the appellant is entitled to a refund of the money he had paid to the respondent company. Here again one of the terms of the policy was that all moneys that had been paid in consequence of the policy would belong to the company if the policy was vitiated by reason of a fraudulent suppression of material facts by the insured. We agree with the High Court that where the contract is bad on the ground of fraud, the party who has been guilty of fraud or a person who claims under him can not 589 ask for a refund of the money paid. It is a well established principal that courts will not entertain an action for money had and received, where, in order to succeed, the plaintiff has to prove his own fraud. We are further in agreement with the High Court that in cases in which there is stipulation that by reason of a breach of warranty by one of the parties to the contract, the other party shall be discharged from the performance of his part of the contract, neither section 65 nor section 64 of the has any application. For the reasons given above we have come to the conclusion that there in no merit in the appeal. The appeal is accordingly dismissed with costs. Appeal dismissed.

In 1942, one M sent a proposal for the insurance of his life. He was examined by Dr. D who submitted two reports, one with the proposal form and one confidential. The confidential report showed that M was anaemic, had a dilated heart and his right lung showed indications of an old attack of pneumonia or pleurisy and that he was a total physical wreck. Nothing came out of this proposal and it lapsed. In 1943, M consulted and was treated by one Dr. L for anaemia oedema of the feet, diarrhoea and panting on exertion. In 1944, M made a second proposal for insurance of his life. Against the question in the proposal form whether he had consulted any medical man for any ailment within the last five years, he gave the answer, "Nor '. He also did not disclose any of his ailments. After medical examination by one Dr. K the proposal was accepted and a policy for Rs. 25,000/ was issued on March 13, 1945. The policy lapsed for non payment of premium but was revived in July, 1946. In November, 1946, M died. His assignee, the appellant, made a demand for Rs. 26,000/ but the Company on October 10, 1947, repudiated it on the ground that the policy had been obtained by deliberate mis statement and fraudulent suppression of material facts. Thereupon, the appellant filed a suit to recover the amount of the policy contending that section 45 Insurance Act, barred the company from calling in question the policy after two years on the ground that any statement made in the proposal was inaccurate or false. ^ Held, that the policy holder was guilty of fraudulent suppression of material facts relating to his health and the Company was entitled to avoid the contract. Section 45 Insurance Act applied to the case as two years had lapsed since the policy was effected; in view of the language of s.45 the two years could not be counted from the date of the revival of the policy. The second part of section 45 entitled the company to repudiate the contract even after the expiry 572 of two years if three conditions were fulfilled viz. (a) the statement was on a material matter or there was suppression of facts which it was material to disclose; (b) the suppression was fraudulently made by the policy holder, and (c) the policy holder must have known at the time of the making of the statement that it was false or that it suppressed facts which it was material to disclose. When M was treated in 1943 by Dr. L he was suffering from serious ailments. He must have known that it was material to disclose this but made a false statement that he had not been treated by any doctor for any serious ailment. There was deliberate suppression fraudulently made by M. Even though the Company had got M examined by four doctors before issuing the policy, it was not estopped from questioning the policy. It had no means of knowing that M had been treated by Dr. L for serious ailments. Held, further, that the appellant was not entitled even to a refund of the money paid as premium as one of the terms of the policy was that all monies paid belonged to the company if the policy was vitiated by fraudulent suppression of material facts. To such a contract neither section 65 nor section 64 of the Indian Contract had any application.

on Nos. 120 of 58 etc. Petition under article 32 of the Constitution of India for enforcement of Fundamental Rights. G. section Pathak, J.B. Dadachanji, S.N. Andley, Rameshwar Nath and P.L. Vohra, for the petitioners (in Petns. 120 and 147 of 1958). section B. Dadachanji, S.N. Andley, Rameshwar Nath and P.L. Vohra, for the petitioner (in Petn. No. 149/58). J.B. Dadachanji, S.N. Andley, Rameshwar Nath and P.L. Vohra, for the petitioners (in Petns. Nos. 148 and 150/58). 415 C.K. Daphtary, Solicitor General of India, N.P. Nathwani, R. H. Dhebar and T. M. Sen, for the respondents. N.P. Nathwani and I. N. Shroff for respondents Nos. 5 and 6 (in Petns. 120, 148 and 156 of 1958). December 22. The Judgment of Sinha, C. J., and Das, J., was delivered by Das, J., the judgment of Sarkar and Mudholkar JJ., was delivered by Mudholkar, J., and Ayyangar, J., delivered a separate judgment. section K. Das, J. In these 13 writ petitions arises a common question of law, namely, the constitutional validity of some of the provisions of the Bombay Land Tenure Abolition Laws (Amendment) Act, 1958 (Bombay Act LVII of 1958) and in particular, of the provisions contained in sections 3 and 4 read with section 6 thereof. We shall hereinafter refer to this Act as the impugned Act, 1958. Put very briefly, the case of the petitioners is that as a result of the provisions of the impugned Act, 1958, certain non permanent tenants were deemed to be permanent tenants as from the commencement of the Bombay Taluqdari Tenure Abolition Act, 1949 (Bombay Act LXII of 1949), hereinafter referred to as the Taluqdari Abolition Act, 1949 and thereby became entitled to acquire on payment of six times the assessment or six times the rent instead of at least the minimum of twenty times the assessment, the rights of an "occupant" within the meaning of section 5A of the Taluqdari Abolition Act, 1949. This result, it is contended, has substantially deprived the petitioners of the rights which they acquired on tillers ' day (April 1, 1957) by reason of the provisions contained in section 32 and other relevant sections of the Bombay Tenancy and Agricultural Lands Act, 1948 (Bombay Act LXVII of 1948) as amended from time to time. It is 416 stated that this deprivation has resulted in the violation of certain fundamental rights of the petitioners, such as those guaranteed under articles 14, 19 and 31 of the Constitution. On behalf of the petitioners it has also been contended that apart from the question of violation of their fundamental rights, the impugned Act, 1958 is a piece of colourable legislation in the sense that under the guise of changing a rule of evidence, it has in effect taken away the petitioners ' property without payment of compensation and given it to another; it is, therefore, a piece of legislation which does not come within any entry of the two legislative lists under which the State Legislature was competent to make laws. To appreciate the points urged in support of the petitions which have all been heard together, it will be necessary to consider the effect and inter ; action of some of the provisions of four principal Acts, namely, (1) the Bombay Land Revenue code 1879 (Bombay Act V of 1879), hereinafter referred to as the Revenue Code; (2) the Bombay Tenancy and Agricultural Lands Act, 1948, as amended from time to time, hereinafter called the Tenancy Act, 1948; (3) the Taluqdari Abolition Act 1979; and (4) the impugned Act, 1958. We shall presently read the relevant provisions of these Acts. But before we do so, it is necessary to state some facts. The facts are similar, though not the same, in all the petitions. It will be sufficient to state the facts of one of the petitions (Petition No. 120 of 1958) in detail in order to focus attention on the main question of law which is the same in all these petitions and which we have indicated briefly in the preceding paragraph. The petitioners are all ex Taluqdars. In Petition No. 120 of 1958 the petitioner was a Taluqdar of two estates known as Sanand and Koth in the Ahmedabad district of the then State of 417 Bombay and now of the State of Gujarat. These two estates comprised 24 Taluqdari villages. The petitioner was the absolute proprietor of all the lands comprised in the two estates, subject to payment of land revenue to the State (Government under the petitioner there were tenants it is stated, some permanent and some non permanent. In the year 1949, the Bombay Provincial Legislature enacted the Taluqdari Abolition Act, 1949 which came into force on August 15, 1950. As a result of the provisions of that Act, the Taluqdari tenure as such was abolished and certain properties, such as, wells, tanks, waste lands, uncultivated lands, etc., were acquired by the State; and the Taluqdar was converted into mere "occupant" as defined in the Revenue Code and was to pay land revenue in accordance with the provisions of that Code. Section 3 (16) of the Revenue code defined an "occupant" as meaning "a holder in actual possession of unalienated land, other than a tenant; provided that where the holder in actual possession is a tenant, the landlord or superior landlord, as the case may be, shall be deemed to be the occupant." In 1955 the Taluqdari Abolition Act, 1949 was amended and section 5A was inserted. This section, in effect, gave a permanent tenant in possession of Taluqdari land the right to become an occupant if he paid six times the assessment for acquiring the right of occupancy. In other words, if a permanent tenant of an ex Taluqdar paid the required amount as stated in section 5A, he became an occupant. himself in place of the ex Taluqdar and came into direct relation with the State in the matter of payment of land revenue, and acquired all the rights of an occupant under the Revenue Code. The right which was conferred by section 5A was available at first for a limited period only, but it was extended till 1962 as stated at the Bar. It is necessary to state now what is meant by "permanent tenant". Section 16 of the Taluqdari Abolition made the provisions of the Revenue Code applicable thereto and an attempt was made to harmonize the provisions of the Taluqdari Abolition Act, 1949 with the provisions of the Revenue Code; therefore, for understanding what is a "permanent tenant" we have to go to the Revenue Code, section 83 whereof, so far as it is relevant, reads as follows: "83 x x x x x And where by reason of the antiquity of a tenancy, no satisfactory evidence of its commencement is forthcoming, and there is not any such evidence of the period of its intended duration, if any, agreed upon between the landlord and tenant, or those under whom they respectively claim title, or any usage of the locality as to duration of such tenants, it shall, as against the immediate landlord of the tenant, be presumed to be co extensive with the duration of the tenure of such landlord and of those who derive title under him. And where there is no satisfactory evidence of the capacity in which a person in possession of land in respect of which he renders service or pays rent to the landlord received, holds or retains possession of the same it shall be presumed that he is in possession as tenant. x x x x It will be noticed that the expression "permanent tenant" does not occur in the section. What is stated therein is that in certain circumstances the duration of the tenancy of a tenant as against his immediate landlord shall be presumed to be co extensive with the duration of the tenure of such landlord. The two circumstances mentioned are, (1) where by reason of the antiquity of the tenancy no satisfactory evidence of its commencement is forthcoming, and (2) where there is no such evidence 419 of the period of its intended duration, if any, agreed upon between the landlord and tenant, or any usage of the locality as to duration of the tenancy. Some time later, by Bombay Act, XIII of 1956, the definition of a "permanent tenant" was inserted in section 2(10A) of the Tenancy Act, 1948. That definition was in these terms: "`permanent tenant ' means a person (a) who immediately before the commencement of the Bombay Tenancy and Agricultural Lands (Amendment) Act, 1955 (hereinafter called `the Amending Act, 1955 ') (i) holds land as mulgenidar or mirasdar; or (ii) by custom, agreement, or the decree or order of a Court holds the land on lease permanently; or (b) the commencement or duration of whose tenancy cannot satisfactorily be proved by reason of antiquity; and includes a tenant whose name or the name of whose predecessor in title has been entered in the record of rights or in any public record or in any other revenue record as a permanent tenant immediately before the commencement of the Amending Act, 1955. " Section 87A of the Tenancy Act, shall, which was also inserted by Bombay Act XII of 1956 by section 47 thereof, said: "Nothing in this Act, shall affect the provisions of any of the Land Tenures Abolition Acts, specified in Schedule III to this Act, in so far as such provisions relate to the conferment of right of An occupant in favour of any inferior holder or tenant in respect of any land held by him." 420 In Schedule III to the Tenancy Act, 1948, was given a list of Land Tenures Abolition Act, including the Taluqdari Abolition Act, 1949. Therefore, the effect of section 87A aforesaid was that nothing in the Tenancy Act, 1948, affected the provisions of the Taluqdari Abolition Act, 1949, in so far as the provisions in section 5A of the Taluqdari Abolition Act 1949, conferred the right of an occupant in favour of a permanent tenant in possession of any taluqdari land on payment of the sums mentioned therein. The arguments before us have proceeded on the footing that before the coming into force of the impugned Act, 1958, the status of a permanent tenant in possession of any taluqdari land was to be determined by the provisions in section 83 of the Revenue Code; in other words by the two circumstances mentioned in that section. What was the position with regard to tenants who were not permanent ? No right was conferred on them by section 5A of the Taluqrlari Abolition Act, 1949, which section was inserted in that Act in 1955 by Bombay Act I of 1955. The rights of these non permanent tenants were governed by the Tenancy Act, 1948, which underwent some fundamental changes in 1956 (see Bombay Act XIII of 1956). The changes relevant for our purpose were contained in section 32 and some of the succeeding sections. The effect of these sections was considered by this court in Sri Ram Ram Narain Medhi vs The State of Bombay (1). After summarising the provisions contained in sections 32 to 32R, this Court said: "The title of the landlord to the land passes immediately to the tenant on the tillers ' day and there is a completed purchase or sale thereof as between the landlord and the tenant. The tenant is no doubt given a locus penitentiae and an option of declaring whether 421 he is or is not willing to purchase the land held by him as a tenant. If he fails to appear or makes a statement that he is not willing to purchase the land, the Tribunal shall by an order in writing declare that such tenant is not willing to purchase the land and that the purchase is ineffective. It is only by such a declaration by the Tribunal that the purchase becomes ineffective. If no such declaration is made by the Tribunal the purchase would stand as statutorily effected on the tillers ' day and will continue to be operative, the only obligation on the tenant then being the payment of price in the mode determined by the Tribunal. If the tenant commits default in the payment of such price either in lump or by instalments as determined by the Tribunal, section 32M declares the purchase to be ineffective but in that event the land shall then be at the disposal of the Collector to be disposed of by him in the manner provided therein. Here also the purchase continues to be effective as from the tillers ' day until such default is committed and, there is no question of a conditional purchase or sale taking place between the landlord and tenant. The title to the land which was vested originally in the landlord passes to the tenant on the tillers ' day or the alternative period prescribed in that behalf. This title is defeasible only in the event of the tenant failing to appear or making a statement that he is not willing to purchase the land or committing default in payment of the price thereof as determined by the Tribunal. The tenant gets a vested interest in the land defeasible only in either of those cases and it cannot therefore be said that the title of landlord to the land is suspended for any period definite or indefinite. " 422 The tillers ' day referred to above was the first day of April, 1957. The argument on behalf of the petitioners is that according to the decision of this Court, the title of the petitioners to lands held by tenants who were entitled to the benefit of sections 32 to 32R passed immediately to the tenants on the tillers ' day and there was a completed purchase or sale thereof as between the petitioners and the tenants. So far as permanent tenants in possession of taluqdari lands were concerned, they were governed by section 5A of the Taluqdari Abolition Act, 1949, and nothing in the Tenancy Act, 1948, affected their right under that section. But non permanent tenants in possession of taluqdari lands became purchasers of their lands on the tillers ' day with an obligation to pay the purchase price mentioned in section 32H of the Tenancy Act, 1948. Section 32H, in so far as it bears upon non permanent tenants, says: "32H. (1) Subject to the additions and deductions as provided in sub sections (1A) and (1B), the purchase price shall be reckoned as follows, namely: (i) in the case of a permanent tenant X X X (ii) in the case of other tenants, the purchase price shall be the aggregate of the following amounts, that is to say, (a) such amounts as the Tribunal may determine not being less than 20 times the assessment and not more than 200 times the assessment; (b) the value of any structures, wells, and embankment constructed and other permanent fixtures made and trees planted by the landlord on the land; (c) the amount of the arrears of rent, if any lawfully due on the tillers ' day or the postponed date; 423 (d) the amounts, if any, paid by or recovered from the landlord as land revenue and other cesses referred to in clauses (a), (b), (c) and (d) of sub section (1) of section 10A, in the event of the failure on the part of the tenant to pay the same. Explanation 1. * * * Explanation 2. * * * (1A) Where a tenant to whom subsections (1) and (2) of section 10A do not apply, has, after the commencement of the Bombay Tenancy and agricultural Lands (Amendment) Act, 1955, paid in respect of the land held by him as tenant land revenue and other cesses referred to in sub section (1) of that section, on account of the failure of the landlord to pay the same, a sum equal to the total amount so paid by the tenant until the date of the determination of the purchase price shall be deducted from the aggregate of the amounts determined under sub section (1). (1B) (a) On the amount arrived at in accordance with the provisions of sub sections (1) and (lA) there shall be calculated interest at 4 1/2, per cent, per annum for the period between the date on which the tenant is deemed to have purchased the land under section 32 and the date of the determination of the purchase price. (b) (i) The amount of interest so calculated shall be added to, and (ii) the amount of rent, if any, paid by the tenant to the landlord and the value of any products of trees planted by the landlord if such products are removed by the landlord during the said period shall be deducted from, the amount so arrived at. 424 (2) The State Government may by general or special order, fix different minima and maxima for the purpose of sub clause (a) of clause (ii) of sub section (1) in respect of any kind of land held by tenants in any backward area. In fixing such minima and maxima, the State Government shall have regard to the rent payable for the land and the factors specified in sub section (3) of section 63A." The difference in the purchase price mentioned in section 5A of the Taluqdari Abolition Act, 1949, and the purchase price mentioned in section 32H of the Tenancy Act, 1948, is noticeable. Under section 5A of the Taluqdari Abolition Act, 1949, the purchase price for the right of occupancy is approximately six times the assessment fixed for the land. Under section 32H, however, the minimum is 20 times the assessment and the maximum 200 times the assessment. These minima and maxima are liable to reduction in the case of land held by tenants in any backward area. Now, the main grievance of the petitioners is this. So far as non permanent tenants were concerned, the title of the petitioners to their lands passed on April 1, 1957, to the tenants and the petitioners ceased to be landlords. All that they became entitled to on that day was the purchase price mentioned in section 32H. By one stroke of the pen as it were, the impugned Act, 1958, made almost all non permanent tenants into permanent tenants and thereby deprived the petitioners of the higher purchase price which they were entitled to get under section 32H and the succeeding sections of the Tenancy Act, 1948. In petition No. 120 of 1958 the petitioners has stated that he would lose about Rs. 14 lacs as a result of the provisions of the impugned Act, 1958. We may now read some of the provisions of the impugned Act, 1958. The Act is entitled "an Act 425 further to define permanent tenants, inferior holders and permanent holders for the purposes of certain Land Tenure Abolition laws and to provide for certain other matters. " In view of the argument advanced before us on behalf of the respondents that the impugned Act, 1958 merely changes a rule of evidence, it is worthly of note that the long title itself states that the Act is an Act further to define permanent tenants. Section 2 of the Act is the interpretation section and the expression 'Land Tenure Abolition law ' means in relation to a permanent tenant, Acts specified in Part I of the Schedule. The Taluqdari Abolition Act, 1949 is one of the Acts mentioned in Part I of the Schedule. The expression 'tenure holder ' means inter alia a taluqdar and 'tenure land ' means inter alia taluqdari land. Sections 3, 4 are 6 and important for our purpose and should be read in full. A person shall, within the meaning of the relevant Land Tenure Abolition law, be deemed to be an inferior holder, a permanent holder or, as the case may be, a permanent tenant, on the date of the abolition of the relevant land tenure, if his name has been recorded in the record of rights or other public or revenue record as an inferior holder, permanent holder or permanent tenant in respect of any tenure land (a) on the date of the abolition of the relevant land tenure, or (b) in pursuance of orders issued during the course of any proceedings under the relevant Land Tenure Abolition law or, as the case may be, the Bombay Land Revenue Code, 1879 (i) before the commencement of this Act, or 426 (ii) after the commence of this Act in cases in which inquiries were pending at the commencement of this Act, or (c) in pursuance of an order issued by the Mamlatdar in respect of an entry under section 6 of this Act. For the purposes of the relevant Act specified in Part I of the Schedule, a person (a) who on the date of the commencement of that Act was holding any tenure land and (b) who and whose predecessors in title, if any, were, immediately before that date for such continuous period of twelve years or more, holding the same tenure land, or any other tenure land, as a tenant or inferior holder under the tenure holder for the time being on payment of an amount exceeding the assessment of the land, shall unless it is proved by the tenure holder that he would not have been a permanent tenant on the basis of continued possession of the land under clause (b), be deemed to be a permanent tenant of the land under clause (a) and all the provisions of that Act shall apply to him as they apply to a permanent tenant. Explanation. The assessment for the purpose of this section shall be reckoned as provided in clauses (a) and (b) of section 5. (1) The rights of an inferior holder, permanent holder or permanent tenant under sections 4 and 5 shall be entered in the record of rights unless the tenure holder applies in writing to the Mamlatdar within six months from the date of the commencement of this Act for a declaration that any holder, or tenant under him is not an inferior holder, a 427 permanent holder or, as the case may be, a permanent tenant. (2) Any such application shall be disposed of as if it were an application in respect of a disputed case under section 135D of the Bombay Land Revenue Code, 1879. " The constitutional validity of the aforesaid provisions has been challenged before us on behalf of the petitioners on the following grounds. (1) The Bombay State legislature was not competent to enact the impugned Act, which is a piece of colourable legislation inasmuch as under the guise of defining a permanent tenant, or changing a rule of evidence, it has really confiscated a large part of the purchase price which the petitioners were entitled to under section 32H of the Tenancy Act, 1948 from some of their tenants; (2) The impugned Act contravenes the rights of the petitioners guaranteed by the Constitution under articles 14, 19 (1) (f) and 31 there of; and (3) Article 31A does not save it. On behalf of the respondents the main argument is that the impugned Act, 1958, merely changes a rule of evidence for determining who are permanent tenants in possession of taluqdari lands; it does nothing more than that and is not, therefore, bad on any of the grounds urged on behalf of the petitioners. It is clear that if the impugned Act merely changes a rule of evidence for determining who are permanent tenants in possession of taluqdari lands, then the points urged as to the violation of the petitioners ' fundamental rights under articles 14, 19 (l) (f) and 31 would not at all arise. If, on the contrary, it is found that the impugned Act is not a piece of legislation which changes a rule of evidence but is a device by which the petitioners have been deprived of their property 428 without payment of compensation, then it would be a piece of colourable legislation not within the competence of the State Legislature. The legislation would then fall on the main ground that it is a piece of colourable legislation, the subject matter of which is not covered by any entry in List II or List III. Therefore, the crux of the matter is what is the true scope and effect of the provisions of the impugned Act, 1958. To this question we now address ourselves. It may be stated at the very outset that the constitutional validity of the relevant provisions of the Taluqdari Abolition Act, 1949 and the Tenancy Act, 1948 as amended by Bombay Act, XIII of 1956 has not been challenged before us. In Dhirubha Devisingh Gohil vs The state of Bombay and Sri Ram Ram Narain Medhi vs The State of Bombay, it was held by this Court that the relevant provisions of those two Acts were Constitutionally valid. What has been challenged before us is the constitutional validity of the relevant provisions of the impugned Act 1958, particularly the provisions in sections 3,4 and 6 which we have quoted earlier. What is the scope and effect of those provisions? Section 3 in effect states that a person shall, within the meaning of the relevant Land Tenure Abolition law, be deemed to be a permanent tenant on the date of the abolition of the relevant land tenure, if his name has been recorded in the record of rights or other public or revenue record as a permanent tenant in respect of any tenure land in any of the three following circumstances (a) on the date of the abolition of the relevant land tenure; or (b) in pursuance of orders issued during the course of any proceeding under the relevant land tenure abolition law or the Revenue Code 429 either before or after the commencement of the impugned Act, 1958; or (c) in pursuance of an order issued by the Mamlatdar in respect of an entry under section 6 of the impugned Act, 1958. It is worthy of note that section 3 does not create a mere presumption, as is referred to in section 135J of the Revenue Code. Section 135J of the Revenue Code states inter alia that an entry in the record of rights shall be presumed to be true until the contrary is proved. Section 3 of the impugned Act, 1958 states, however, that a person shall be deemed to be a permanent tenant on the date of the abolition of the relevant land tenure if his name has been recorded in the record of rights in respect of any tenure land in any of the three circumstances mentioned as (a), (b) and (c) therein. In other words, if any one of the three circumstances mentioned in the section exists, then by a fiction of law a person who fulfils that circumstance must be deemed to be a permanent tenant. Section 4 says in effect that a tenant(a) who on the date of the commencement of the Taluqdari Abolition Act, 1949 was holding any tenure land, and (b) who and whose predecessors in title, if any, were immediately before that date for such continuous periods as aggregate to a total continuous period of 12 years or more, holding the same tenure land, or any other tenure land shall unless it is proved by the tenure holder that he would not have been a permanent tenant on the basis of continued possession of the land under (b) above, be deemed to be a permanent tenant of the land under (a), and all the provisions of the Taluqdari Abolition Act, 1949 shall apply to him as they apply to a permanent tenant. There is a third condition mentioned in section 4, namely, the amount which the tenant pays must exceed the assessment of the land. This condition does not, however have any importance in the discussion which follows and no further reference to it is necessary. 430 There is no difficulty in understanding cl. (a) of section 4 but cl. (b) is not so clear. The expression "continuous periods as aggregate to a total continuous period of twelve years or more" is neither very elegant nor very clear. Perhaps, the expression means that one particular continuous period may be of less than twelve years but there may be more than one such continuous period and in such a case the totality of such continuous periods must aggregate twelve years or more; if however, one continuous period extends over twelve years or more, there is no difficulty, and the question of the aggregate totalling twelve years does not arise. The question of the aggregate totalling twelve years will arise when there are more continuous periods than one, of less than twelve years duration each. The possessions for such continuous periods may be of the same tenure land or of different tenure lands. If however, the aggregate of continuous periods of possession of the same tenure land or of any other tenure land comes to twelve years or more, then cl. (b) of section 4 is fulfilled. It further appears that conditions mentioned in (a) and (b) are cumulative. In other words, for the application of s.4, a tenant must be in possession of tenure land on the date of the commencement of the Taluqdari Abolition Act, 1949 (August 15, 1950) and further more must have been in possession of the same tenure land or of any other tenure land for continuous periods aggregating more than twelve years immediately before the said date. A person who fulfils the aforesaid two conditions shall be deemed to be a permanent tenant of the land unless it is proved by the tenure holder that he would not have been a permanent tenants of the basis of possession referred to in cl.(b). The expression "unless it is proved by the tenure holder that he would not have been a permanent tenant on the basis of continued possession of the land under clause (b)" has again given rise to some difficulty. Two views have been can 431 vassed before us. One view is that the expression means that the tenure holder can only contest the correctness of the claim of twelve years ' possession and show that the tenant was not in possession of the land or lands concerned or that the continuous period or periods of possession did not aggregate twelve years. The other view is that the tenure holder can show that the tenancy commenced on a particular date or that there is satisfactory evidence of the duration of the tenancy, and therefore, under section 83 of the Revenue Code the tenant would not be a permanent tenant merely by reason of twelve years ' possession. Section 4 as worded is somewhat obscure and if one were to go merely by the words used, one would be inclined to accept the first view. On that view, the Section undoubtedly would go much further than merely introducing a rule of evidence; it would create a new class of permanent tenants not contemplated by section 83 of the Revenue Code. The latter section talks of two circumstances which determine the status of a tenant: one relates to commencement of the tenancy and the other to its intended duration. Under section 83 the onus will be on the person who claim a permanent status as a tenant to prove that either the commencement of the tenancy is not known or that its intended duration was not agreed upon between the landlord and tenant or was not governed by any usage of the locality. Section 4 of the impugned Act, 1958 gives a go by to these circumstances. It brings in different considerations altogether. In effect it says that if a person was in possession of any tenure land on August 15, 1950 (the date of commencement of the Taluqdari Abolition Act, 1949) and was further more in possession of the same tenure land or any other tenure land for a continuous aggregate period of twelve years, he would be deemed to be a permanent tenant, unless the tenure holder proved that he was not in possession for a continuous aggregate period of twelve years 432 as laid down in cl. (b) of the section. This means that instead of the two circumstances relating to commencement and duration a new consideration is brought in, namely, whether the tenant has been in possession for a continuous, aggregate period of twelve years. If he has been, then he is a permanent tenant. If he has not been in such possession, then he is not a permanent tenants. In other words, section 4 of the impugned Act, 1958, completely changes the definition of a permanent tenant and creates a new class of permanent tenants who were not permanent tenants on April 1, 1957. If this view is correct, and we think that there is a good deal to be said in favour of this view, then section 4 of the impugned Act, 1958 in spite of giving the tenure holder an opportunity of proving that the tenant was not in possession for an aggregate continuous period of twelve years under section 4 read with section 6, undoubtedly changes the very definition of permanent tenant and by that change wipes out a large part of the purchase price which the petitioners were entitled to get on April 1, 1957 from some of their tenants. It is not disputed that on this view of section 4, the impugned legislation would be unconstitutional inasmuch as it would bring within the category of permanent tenants persons who were non permanent tenants under the previous law and there by deprive the tenure holders of part of the purchase money which they were to get from them. It has been contended that the second view with regard to the expression "unless it is proved by the tenure holder that he would not have been a permanent tenant on the basis of continued possession of the land under clause (b)" is preferable on the ground that cl. (b) is one of the conditions which the tenant must fulfil before he can get the benefit of section 4 and there would not be much sense in allowing the tenure holder to disprove a condition which the tenant must fulfil before he can get 433 the benefit of section 4. We find it difficult to accept this view. On a pure question of construction of the words used in section 4, we see nothing wrong in allowing the tenure holder to prove that the tenant was not in possession for continuous periods aggregating twelve years. Let us, however, assume that the second view as to the interpretation of section 4 of the impugned Act, 1958, is preferable to the first view. What then is the position? The position then is that a tenant who fulfils the two conditions mentioned in cls. (a) and (b) must be deemed to be a permanent tenant unless the tenure holder proves the commencement and/or duration of the tenancy. From this point of view it may be argued that section 4 merely changes a rule of evidence and throws the onus on the tenure holder to prove that in spite of twelve years ' continuous possession mentioned in cl. (b), the tenant is not a permanent tenant by reason of the circumstance that the commencement of the tenancy or its intended duration is known. Under section 6 the rights of a permanent tenant under section 4 shall be entered in the record of rights unless the tenure holder applies in writing to the Mamlatdar within six months from the date of the commencement of the impugned Act, 1958, for the declaration that the tenant under him is not a permanent tenant. If any such application is filed by the tenure holder, it shall be disposed of as if it were an application in respect of a disputed case under section 135D of the Revenue Code. What is the effect of section 6 ? It was conceded by the learned counsel appearing for the respondent State and also the respondent tenants that the tenure holder has only one opportunity of saying that a tenant under him is not a permanent tenant and the tenure holder must avail himself of that opportunity within six months from June 10, 1958, the date on which the impugned Act, 1858, came into force. The combined effect of sections 3, 4 and 6 appears to us to be this. If the tenure holder has made no application 434 within six months from June 10, 1958, for a declaration that a tenant under him is not a permanent tenant, every tenant under him who fulfils the conditions mentioned in cls. (a) and (b) of section 4 at once gets recorded in the record of rights as a permanent tenant. As soon as he is so recorded, he must be deemed under section 3 to be a permanent tenant by a fiction of law and under section 4 all the provisions of the Taluqdari Abolition Act, 1949, will apply to him as they apply to a permanent tenant. This combined effect of sections 3, 4 and 6 of the impugned Act, 1958 does in our opinion deprive the tenure holder of any real opportunity of contesting the claims of his tenants and makes them permanent tenants once they are recorded in the record of rights, thereby depriving the tenure holder of the purchase price which he was entitled to get from them under section 32H of the Tenancy Act, 1948. On behalf of the respondents it was stated at the Bar that the petitioners had made applications for a declaration under section 6 of the impugned Act, 1958, and that those applications are still pending. We have no materials in support of this statement. No affidavit has been made on behalf of the respondents to this effect; nor do we know if those applications related to all the non permanent tenants of the petitioners. What we know is that in a stay application made by the petitioner in petition No. 120 of 1958 it was averred that the petitioner had filed several declaratory suits before the Mamlatdar under section 70(b) of the Tenancy Act, 1948, for a declaration that the tenants concerned were not permanent tenants. Those suits were however, filed prior to the coming into force of the impugned Act, 1958. The petitioner asked for a stay of those suits on two grounds: firstly, that after the coming into force of the impugned Act, 1958, the suits would become infructuous, and secondly, that the Mamlatdar concerned would have no jurisdiction to adjudicate upon the constitutional 435 validity of the provisions of the impugned Act, 1958, and in view of those provisions would be bound to hold that the tenants had become permanent tenants. This Court passed no order on the application for stay. But the petitioner, it appears, moved the Mamlatdar to stay the hearing of the suits pending the disposal of the writ petition in this Court and the suits were stayed. In a second petition filed on behalf of the petitioner it was stated that after the coming into force of the impugned Act, 1958, the petitioner received a notice to show cause why the non permanent tenants under him should not be declared to be permanent tenants and the record of rights amended accordingly. The petitioner applied to the Revenue Officer concerned to stay the proceedings in view of the writ petition pending in this Court. This request was, however, turned down. The petitioner then came to this Court and it appears that an order was made to the effect that any investigation which might be necessary for the proceedings pending before the Revenue Officer might be continued, but no final order or entry should be made till the disposal of the writ petition. Such an order appears to have been made in respect of a number of villages and the petitioner stated that he had thousands of tenants in 24 villages, some of whom were permanent, some protected, and some ordinary. Nothing was stated in those petitions or in the replies thereto as to whether the tenure holder had made an application for a declaration within the meaning of section 6 of the impugned Act, 1958. All that has been stated in the application is that in response to a notice received from the Revenue Officer, the petitioner, as a tenure holder, had moved this Court for a stay of the proceedings. If the petitioner had filed no application for a declaration within the meaning of section 6 of the impugned Act, 1958, and within the time allowed by that section, then it is obvious 436 that the Revenue Officer dealing with the suits under section 70(b) of the Tenancy Act, 1948, pending before him, or the Revenue Officer dealing with other proceedings before him, must give effect to the provisions of sections 3, 4 and 6 of the impugned Act, 1958. It is, therefore difficult to see how the pendency of the suits or other proceedings before the Revenue Officers concerned can be of any assistance to the petitioners. The question, therefore, boils down to this. Section 6 of the impugned Act, 1958 does give one opportunity to the petitioners to make an application for a declaration that any tenant under him is not a permanent tenant, but that opportunity was to be availed of within six months from June 10, 1958. Once that opportunity is lost, the tenure holder cannot claim that a tenant who fulfils cls. (a) and (b) of section 4 is not a permanent tenant. Our attention was drawn to sub sections (3), (4) and (5) of section 5A of the Taluqdari Abolition Act, 1949. Those sub sections say in effect that if any question arises whether any person is a permanent tenant, the State Government or an officer authorised by the State Government in that behalf shall decide the question; where such officer decides such question any person aggrieved by the decision may file an appeal to the State Government within 60 days from the date of the decision; and the decision of the State Government shall be final. It was not suggested before us that the aforesaid sub sections would give the tenure holder a second opportunity of contesting the claim of the tenant, and it seems to us quite clear that the tenure holder who had failed to make an application within the time mentioned in section 6 of the impugned Act, 1958, would not be in a position to take advantage of sub sections (3), (4) and (5) of section 5A of the Taluqdari Abolition Act, 1949. If sections 3, 4 and 6 of the impugned Act, 1958, are good and valid in law, then whichever be the authority that has to decide the claim of the tenant, it must decide it in accordance with those provisions. 437 In these circumstances, can it be said that the opportunity given by section 6 is a real opportunity and does it amount to merely changing a rule of evidence ? We think that this question must be answered in the negative. It is to be noted that on April 1, 1957 the petitioners ceased to be tenure holders of the lands held by non permanent tenants and as held by this Court, sections 32 to 32R of the Tenancy Act, 1948, clearly contemplated the vesting of the title in the tenants on the tillers ' day, defeasible only on certain specified contingencies. This Court held that those sections were designed to bring about an extinguishment, or in any event a modification of the landlord 's rights in the estate within the meaning of article 31A (1) (a) of the Constitution. If that was the true effect of sections 32 to 32R of the Tenancy Act, 1948, then on April 1, 1957 the petitioners were left only with the right to get the purchase price under section 32H. That right of the petitioners was undoubtedly a right to property. In Bombay Dying and Manufacturing Co. Ltd. vs The State of Bombay (1) this Court observed, with regard to unpaid wages of an employee, that when an employee had done his work, the amount of wages earned by him become a debt due to him from the employer and this was property which could be assigned under the law. The provisions of the Bombay Labour Welfare Fund Act (Bombay Act XL of 1953) were under consideration in that case. Section 3 of the Act transferred inter alia all unpaid accumulation of wages to a fund known as the Bombay Labour Welfare Fund. This Court held that section 3 (1) of the Act in so far as it related to unpaid accumulation in section 3(2) (b) was unconstitutional and void by reason of the right guaranteed under article 19(1) (f) of the Constitution and was not saved by cl.(5) thereof. We think that the same principle must apply in the 438 present case. The right of the petitioners to the purchase price under section 32H of the Tenancy Act, 1948, from those of their tenants who were non permanent on April 1, 1957, was a right of property in respect of which the petitioners have a guarantee under article 19 (1)(f). The provisions in sections 3,4 and 6 of the impugned Act, 1958, in so far as they laid down that in certain circumstances a tenant shall be deemed to be a permanent tenant from the date of the Taluqdari abolition Act, 1949, adversely affected the right of the petitioners with retrospective effect; it practically wiped off a large part of the purchase price which the petitioners were entitled to get. If section 6 of the impugned Act, 1958, is to be tested on the touchstone of reasonable restrictions in the interests of the general public as laid down in cl. (5) of article 19 of the Constitution, it must be held that it does not impose a reasonable restriction. We have found it very difficult to understand why and how it is reasonable that the tenure holder must make an application within six months from the commencement of the impugned Act, 1958, for a declaration that his tenants are not permanent tenants. The petitioners have three kinds of tenants permanent tenants, protected tenants, and ordinary tenants. On April 1, 1957 the petitioners ceased to be tenure holders in respect of all tenants other than permanent tenants and became entitled only to the purchase price under section 32H. If any tenant claimed on that date that he was a permanent tenant, he had to establish his claim in accordance with section 83 of the Revenue Code. Such a claim could be contested by the tenure holder whenever made by the tenant. But by the impugned Act, 1958, all this was changed, and unless the tenure holder made an application within six months of the commencement of the impugned Act, 1958, he was not in a position to say that a particular tenant who was in possession of tenure land for continuous period aggregating twelve years on and before August 15, 439 1950, was not a permanent tenant. We are unable to hold that the six months ' limit imposed by section 6 of the impugned Act, 1958, is in the circumstances, a reasonable restriction within the meaning of article 19(5) of the Constitution. It is a little difficult to understand how the tenure holder could know which of his non permanent tenants would claim to be permanent on the coming into force of the impugned Act, 1958. Obviously, the tenure holder had to anticipate that all his non permanent tenants might claim to be permanent, and therefore it was incumbent on him to make an application for a determination that none of his non permanent tenants were permanent, and unless he did so he would lose his right to get the purchase price under section 32H of the Tenancy Act, 1948. We are clearly of the view that the time limit imposed by section 16 of the impugned Act, 1958, is, in these circumstances, and unreasonable restriction and cannot be justified under article 19(5) of the Constitution. In view of this finding it is unnecessary to consider the effect of article 31 of the Constitution. On behalf of the respondent State reliance was sought to be placed on article 31A of the Constitution. That Article, in our opinion, has no application to the present cases, inasmuch as there was no acquisition by the State of any estate or any rights therein or the extinguishment or modification of any such rights. On April 1, 1957, the tenure holders had ceased to be tenure holders in respect of lands held by non permanent tenants. The relation between the tenure holders and the tenants had changed from that of landlord and tenant to that of creditor and debtor. When, therefore, the impugned Act, 1958, affected the right of the petitioners as creditors to get a certain sum of money from the debtors, it did not provide for the acquisition by the State of any estate or of any rights therein; nor did it provide for the extinguishment or modification of any such 440 rights. Therefore, article 31A has no application and cannot save the impugned Act, 1958. It has been contended before us that while implementing the provisions of section 5A of the Taluqdari Abolition Act, 1949, it was found that because of the failure or inability of the ex Taluqdar to produce old records concerning the tenants it was difficult for the tenants to take the benefit of that provision; therefore, it became necessary for the Legislature to define permanent tenant in such a way that the tenure holder might not defeat the provisions of section 5A. That it was stated, was the reason for enacting sections 3, 4 and 6 of the impugned Act, 1958. We are unable to accept this argument as correct. If the reason was as stated above, then the tenure holder should have been given a chance to contest the claim of the tenant whenever he made a claim of being a permanent tenant. It appears to us that the true scope and effect of the provisions in sections 3, 4 and 6 of the impugned Act, 1958 is to considerably reduce the purchase price payable to the petitioners and this has been secured by the device of defining permanent tenant in such a way that the tenure holder has no real opportunity of contesting the claim of the tenants. In that view of the matter, the impugned Act, 1958, does not fall within any entry of List II or List III of the Seventh Schedule to the Constitution and is a piece of colourable legislation. What is colourable legislation was explained by this Court in K. C. Gajapati Narayan Deo vs The State of Orissa (1). This Court said that the idea conveyed by the expression "colourable legislation" is that although apparently a legislature in passing a statute purported to within the limits of its powers, yet in substance and in reality it transgressed those powers, the transgression being veiled by what appears, on proper examination, to be a mere pretence or disguise. We are of the view that, that is what has happened in the present case. Under the guise of defining a 441 permanent tenant or changing a rule of evidence what has been done is to reduce the purchase price which became payable to the tenure holders on April 1, 1957. For these reasons we must hold that sections 3, 4 and 6 of the impugned Act, 1958 in so far as they deem some tenants as permanent tenants in possession of taluqdari land are unconstitutional and void. Under the guise of changing the definition of a permanent tenant, they really take away a large part of the right of the petitioners to get the purchase price under section 32H of the Tenancy Act, 1948, from some of their tenants. The petitions must accordingly be allowed with costs. As the petitions have been heard together there will be only one hearing fee. MUDHOLKAR, J, Writ petition No. 120 of 1958 was heard along with writ petitions Nos. 147 to 158 of 1958. But a common argument was advanced before us on behalf of the petitioner in each case by Mr. G.S. Pathak and by the Solicitor General on behalf of the State of Gujarat and by Mr. Nathwani on behalf of the tenants. The petitioners in these cases were Talukdars of certain villages in that part of the former state of Bombay which is now the State of Gujarat. The rights of Talukdars in different parts of Gujrat to Taluqdari villages were regulated by the Ahmedabad Taluqdars Act, 1862 (Bom. 6 of 1862) and the Broach and Kaira Incumbered Estates Act, 1881 (XXI of 1881) and the Gujarat Taluqdars Act, 1888. The Bombay Taluqdari Tenure Abolition Act, 1949 (herein referred to as the Abolition Act) repealed the aforementioned Taluqdari Acts and section 3 thereof abolished the Taluqdari tenure wherever it prevailed. That section further abolished all incidents of the said tenure attaching to any land comprised in a Taluqdari Estate. Section 5 of that Act made all the taluqdars "occupants" of the lands in their 442 possession, within the meaning of the expression "occupant" occurring in the Bombay Land Revenue Code (hereafter referred to as the Code). Like "Occupants" in other areas of the Bombay State these persons became liable to pay land revenue to the Government subject to the provisions of cl.(b) of sub s.2 of s.5. Nothing, however, turns on these provisions. Section 16 of the aforesaid Act makes the provisions of the Code applicable to taluqdari villages subject to certain modifications with which we are not concerned. The validity of the Abolition Act was challenged before this Court but that challenge failed vide Dhisubha Devisingh Gohil vs The State of Bombay(1). Vast areas of lands in these villages were in the occupation of inferior holders, permanent tenants, protected tenants, ordinary tenants etc. It is not disputed that the provisions of Ch. VII of the Code which deals with "superior holders and inferior holders" govern the relationship between the tenure holders and permanent tenants. In addition to these provisions there are those in the Bombay Tenancy and Agricultural Lands Act, 1948 (hereafter referred to as the 'Tenancy Act ') which deal with the relationship between landlord and tenant and till April 1, 1957, it is these provisions which exclusively governed the relationship between the tenure holder and tenants other than permanent tenants and inferior holders. It would be necessary to refer to some of the provisions of this Act while dealing with the arguments advanced before us. By Bombay Taluqdari Abolition (Amendment) Act 1 of 1955 which came into force on March 1, 1955, the Abolition Act was amended and a new provision was added therein, viz: section 5A the relevant portion of which reads thus: "(1) Notwithstanding anything contained in section 5 a permanent tenant in possession 443 of any taluqdari land, and also an inferior holder holding such land on payment of annual assessment only, shall be deemed to be occupants within the meaning of Code, in respect of such land in their possession and shall be primarily liable to the State Government for the payment of land revenue due in respect of such land, and shall be entitled to all the rights and shall be liable to all the obligations in respect of such land as occupants under the Code or any other law for time being in force: Provided that (a) such permanent tenant shall be entitled to the rights of an occupant in respect of such land on payment to the taluqdar or the cadet as the case may be : (i) of the occupancy price equivalent to four multiples of the assessment fixed for such land, and (ii) for the extinguishment or modification of any rights of the taluqdar or cadet, as the case may be, including the right of reversion in the lands, of a further sum equivalent to two multiples of such assessment; x x x (2) The right conferred under sub section (1) shall not be exercisable after a period of (five) years from the date on which the Bombay Taluqdari Tenures Abolition (Amendment), Act 1954 comes into force. x x x This section for the first time conferred upon a permanent tenant the right to acquire the status of an occupant in respect of the land held by him as a permanent tenant of the tenure holder upon payment of a certain sum of money as the price of occupancy to the tenure holder within five years of the commencement of the Amending Act of 1955. 444 It was accepted before us that the period fixed by section 5A has been extended upto the year 1962. Section 5A of the Act has never been challenged, and the argument before us proceeded upon the footing that it is a perfectly valid piece of law. Though the Abolition Act by section 5A thus conferred upon the permanent tenants in the taluqdari villages the right become occupants, it did not define what a permanent tenant was. By an amendment made by Bombay Act XVIII of 1958, it was provided that certain persons would be permanent tenants but that does not really define what a permanent tenant is. This absence of definition of a permanent tenant did not, however, create any difficulty because in Bombay that term has been understood to mean the tenant described in paragraph 2 of section 83 of the Code. Indeed, in the petitions themselves it is stated that s.83 of the Code defines a permanent tenant. The second paragraph of that section is in these terms: "And where by reason of the antiquity of a tenancy no satisfactory evidence of its commencement is forthcoming, and there is not any such evidence of the period of its intended duration, if any, agreed upon between the landlord and tenant, or those under whom they respectively ' claim title or any usage of the locality as to duration of such tenancy, it shall, as against the immediate landlord of the tenant, be presumed to be co extensive with the duration of the tenure of such landlord and of those who derive title under him." Under this section, therefore, a permanent tenant is one whose tenure is co extensive with that of his landlord and a tenant is to be presumed to be such a tenant when by reason of antiquity, the commencement of the tenancy cannot be proved and there is no satisfactory evidence of the agreed duration of the tenancy or of any usage of the locality as 445 to such duration. The Bombay Tenancy and Agricultural Lands Act, 1956 (13 of 1956) which among other provisions, has amended section 2 of the Tenancy Act has given a definition of the expression in the new sub s.10A thereof but it is not necessary to reproduce it as no argument based on it is advanced before us as indeed none could be advanced. That Act made extensive and far reaching amendments in the Bombay Tenancy Act. Several sections thereof were recast including s.32. Amongst the Provisions added are sections 32A to 32 R which appear in the second part of Chapter 3 of that Act, dealing with "Purchase of land by tenants" to which we will refer hereafter. By virtue of s.32, sub. section 1, on April 1, 1957, called the "tillers ' day" every tenant, including permanent tenant was, subject to the other provisions of that section and of the succeeding sections deemed to have purchased the tenancy land in his possession from the landlord free of all encumbrances subsisting thereon. Section 87A, which also was added to the Tenancy Act by the Amending Act of 1956, provided that nothing in the Tenancy Act was to affect the provisions of any of the Land Tenure Abolition Acts specified in Schedule II (which includes the Abolition Act in question) in so far as such provisions relate to the confinement of the right of an occupant upon a permanent tenant in respect of land held by him. In consequence of this the provisions of section 32 H of the Tenancy Act which deal with the purchase price payable by permanent tenants will not apply to such permanent tenant. He would, therefore, have only that right which is conferred upon a permanent tenant by section 5 A of the Abolition Act. The result of this is that he would not be bound to pay the purchase price at once under section 32 H of the Tenancy Act and can make his election to acquire or not to acquire the right of an occupant within the period allowed by section 5 A (as extended from time to time). 446 The records relating to tenancies in taluqdari villages used to be maintained by the tenure holders. It is from these records that information could be obtained as to the nature of the tenancies of the tenants in those villages. While implementing the provisions of section 5 A of the Abolition Act it was found that because of the refusal, failure or inability of the taluqdar to produce old records concerning the tenants it was difficult for the tenants to take the benefit of that provision. Therefore, the legislature passed Bombay Act No. 57 of 1958 called the Bombay Land Tenure Abolition Laws (Amendment) Act, 1958. The long title of the Act runs thus: "An Act further to define permanent tenants, inferior holders and permanent holders for the purposes of certain Land Tenure Abolition laws and to provide for certain other matters. " Section 4 of this Act states who are to be deemed to be permanent tenants for the purpose of the Land Tenure Abolition laws specified in Part II of the Schedule to the Act. The validity of this Act (hereafter referred to as the impugned Act) and in particular of the provisions of section 4 is challenged before us. We will reproduce hereafter this section and certain other provisions of the Act which have a bearing upon the arguments addressed before us. According to Mr. Pathak section 4 of the Act in effect expands the category of permanent tenants by bringing within its fold persons who were merely ordinary tenants prior to the enactment of this provision. So far as an ordinary tenant is concerned it is Mr. Pathak 's contention that on the tillers ' day he became an occupant of the land or at any rate the landlord (or tenure holder) lost his interest therein and that thereafter the latter became entitled to receive from the tenant the purchase price by the combined operation of section 32(1) and section 32 H(1) (i) of the Tenancy Act. Section 32(1) so far as material runs thus: 447 "On the Ist day of April, 1957, (hereinafter referred to as 'the tillers ' day ') every tenant shall, subject to the provisions of the next succeeding sections, be deemed to have purchased from his landlord, free of all encumbrances subsisting thereon on the said day, the land held by him as tenant, if (a) such tenant is a permanent tenant thereof and cultivates the land leased personally; (b) such tenant is not a permanent tenant but cultivates the land leased personally; and (i) the landlord has not given notice of termination of this tenancy under section 31: or (ii) notice has been given under section 31, but the landlord has not applied to the Mamlatdar on or before the 31st day of March, 1957 under section 29 for obtaining possession of the land; (or) (iii) the landlord has not terminated this tenancy on any of the grounds specified in section 15, or has so terminated the tenancy but has not applied to the Mamlatdar on or before the 31st day of March, 1957 under section 29, for obtaining possession of the lands; . . . " Section 32 H, so far as material, runs thus: "(1) Subject to the additions and deductions as provided in sub sections 1A and 1B, the purchase price shall be reckoned as follows, namely: (i) In the case of a permanent tenant who is cultivating the land personally 448 the purchase price shall be the aggregate of the following amounts, that is to say, . . . " (ii) In the case of other tenants the purchase price shall be the aggregate of the following amounts, that is to say, (a) such amount as the Tribunal may determine not being less than 20 times the assessment and not more than 200 times the assessment; . . . " According to the petitioner in W. P. 120 of 1958 the total area of land held by him in his villages is 62,588 acres out of which only 703 acres are in his personal cultivation and the rest is held by tenants who are non permanent tenants. He contends that by the operation of section 4 of the impugned Act most of these persons are likely to be placed in the category of permanent tenants with the result that the petitioners would be compelled to accept purchase price at a much lower rate, that is, they would get only six times the assessment instead of between 20 and 200 times the assessment, as may be determined by the tribunal. According to him his estimated loss would be over Rs. 14,00,000. On behalf of the State it is denied that the petitioner would be put to any such loss. The substance of the argument of Mr. Pathak is that the right to claim compensation under s.32H(1)(ii) from the ordinary tenants having vested in the petitioner it cannot be taken away by the Bombay legislature by extending the definition of "permanent tenant" so as to include within it those who were merely ordinary tenants on the "Tillers ' Day". He formulated his grounds of attack on the legislation as follows: (1) The Bombay legislature was not competent to enact the impugned Act as the subject 449 matter thereof is not covered by any entry in List II. (2) The impugned Act is colourable legislation as it amounts to a device adopted for the purpose of confiscating money, the right to claim which had vested in the landlord as purchaser on April 1, 1957, and that the State legislature had no power to make a law with respect to this matter. (3) The impugned Act being outside the legislative competence of the Bombay legislature, taking away of the petitioner 's money was a contravention of article 31(1) of the Constitution. (4) The acquisition of money is not for a public purpose as taking money from one and giving to another is not a public purpose. (5) Even assuming that the acquisition was for a public purpose no compensation has been provided by the Act or could indeed be provided by the Act and, therefore, article 31(2) is contravened. (6) The impugned Act contravenes article 19(1)(f) of the Constitution inasmuch as it authorises the confiscation of money. (7) The Act infringes article 14 of the Constitution as there are other classes of tenure holders similarly situate to whom the impugned Act does not apply. All these grounds of attack, except the last, rest upon one assumption and that assumption is that section 4 of the impugned Act extends the definition of permanent tenants and brings within its fold persons who were till April 1, 1957, that is, the "tillers ' day", ordinary tenants. If this assumption is invalid then the whole edifice which Mr. Pathak has built upon it must tumble down. Let us 450 consider what exactly section 4 of the impugned Act does. In order to appreciate Mr. Pathak 's argument properly it would be desirable to reproduce that section as well as sections 3 and 6. These sections run thus: Section 3 : "A person shall, within the meaning of the relevant Land Tenure Abolition law, be deemed to be an inferior holder, a permanent holder or, as the case may be, a permanent tenant, on the date of the abolition of the relevant land tenure, if his name has been recorded in the record of rights or other public or revenue records as an inferior holder, permanent holder or permanent tenant in respect of any tenure land (a) on the date of the abolition of the relevant land tenure, or (b) in pursuance of orders issued during the course of any proceedings under the relevant Land Tenure Abolition law or, as the case may be, the Bombay Land Revenue Code, 1879 (i) before the commencement of this Act, or (ii) after the commencement of this Act in cases in which inquiries were pending at the commencement of this Act, or (c) in pursuance of an order issued by the Mamlatdar in respect of an entry under section 6 of this Act. " The relevant Land Tenure Abolition law for our purposes is the Bombay Tenancy Abolition Act and tenure land means taluqdari land. Section 4 runs thus: "For the purposes of the relevant Act specified in part I of the Schedule, a person 451 (a) who on the date of the commencement of that Act was holding any tenure land, and (b) who and whose predecessors in title, if any were, immediately before that date for such continuous periods as aggregate to a total continuous period of twelve years or more, holding the same tenure land or any other tenure land, as a tenant or inferior holder under the tenure holder for the time being on payment of an amount exceeding the assessment of the land, shall unless it is proved by the tenure holder that he would not have been a permanent tenant on the basis of continued possession of the land under clause (b), be deemed to be a permanent tenant of the land under clause (a) and all the provisions of that Act shall apply to him as they apply to a permanent tenant. " Section 6 runs thus: "(1) The rights of an inferior holder, permanent holder or permanent tenant under sections 4 and 5 shall be entered in the record of rights unless the tenure holder applies in writing to the Mamlatdar within six months from the date of the commencement of this Act for a declaration that any holder or tenant under him is not an inferior holder, a permanent holder or, as the case may be, a permanent tenant. (2) Any such application shall be disposed of as if it were an application in respect of a disputed case under section 135D of the Bombay Land Revenue Code, 1879." Thus according to section 3 a person whose name is recorded in the record of rights or other public revenue records as a permanent tenant in respect of tenure land he will be deemed to be a permanent 452 tenant within the meaning of the expression occurring in the Abolition Act. As already stated, for ascertaining the meaning of the expression one has to go to para. 2 of section 83 of the Code. No doubt, it merely raises a presumption as to permanent tenancy but from that para. we can deduce the essential feature of a permanent tenancy. The argument is that section 3 being a deeming provision in so far as the Abolition Act is concerned, gives new definition of a permanent tenant. What the section says is that certain persons will be deemed to be permanent tenants for the purpose of the Abolition Act. Who are these persons ? Are they chosen arbitrarily and put in that class though they could not possibly have been so put under the previous law ? A bare perusal of clauses (a) to (c) of section 3 shows that only tenants who have been found on enquiry to be permanent tenants, at least presumptively, are to be regarded as permanent tenant, for the purpose of the Abolition Acts and their status as permanent tenants can no longer be questioned. In regard to persons whose cases fall under clauses (a) and (b) all that the section has done is to take away the right of the tenure holder to challenge in a collateral proceeding their status as permanent tenants. As regards tenants falling under cl. (c) what the provision has done is to require the tenure holder to object to the recording of such person as permanent tenant within a certain time before the mamlatdar. If he fails to avail himself of the opportunity the door is shut to his saying thereafter that the person is not a permanent tenant. It is to be noted that tenants who are to be regarded as permanent tenants for the purposes of the Abolition Act have been so found in enquiries held by revenue courts and not persons arbitrarily selected or persons who could not reasonably be regarded as permanent tenants. 453 The inclusion of persons as permanent tenants in the register of rights may be prior to the commencement of the Abolition Act or after its commencement. The proceedings for the inclusion may have been instituted prior to the commencement of the Abolition Act or may be instituted under the impugned Act. If they hold in favour of the tenant he will be deemed to be a permanent tenant. The landlord cannot then be permitted to say that he is not a permanent tenant. It is difficult to see how this disability imposed upon a landlord to dispute the fact that a person is a permanent tenant be regarded as enlarging the definition of a permanent tenant. It is true that section 135.J of the Code granted the landlord a right to challenge the correctness of an entry in the record of rights in collateral proceedings without reference to time and that right is abrogated by the impugned Act but even so doing that cannot be regarded as taking away a vested right. Within what time, in what circumstances and in which manner a particular fact is open to challenge is only a matter of procedure and it cannot be disputed that there is no vested right in procedure. The effect of the provision thus is that in proceedings under the Abolition Act for conferral of a right of an occupant the claimant 's status as a permanent tenant cannot, if he satisfies the requirement of any of the three clauses of section 3 of the impugned Act be open to question by the tenure holder. Would the position have been any different if the impugned Act had not been passed ? Let us consider section 5A of the Abolition Act by itself. Suppose a person recorded as a permanent tenant in the record of rights claimed to enforce the right conferred by this section to obtain the right of an occupant in proceedings thereunder. These proceedings would be taken before a revenue officer and he would be bound to act on the entry in the record 454 of rights until and unless it was lawfully substituted by another. No suit lies for correcting an entry in the record of rights. Only in a collateral proceeding could it have been challenged and the jurisdiction of a civil court be invoked. Where no such suit or proceeding is pending when the proceedings under section 5A are going on the tenure holder cannot be permitted to go behind the entry. However, as an additional safeguard the Abolition Act has provided in section 5A itself a remedy and that is to approach the State Government or an authority empowered by it in this behalf for deciding to question. Clause (b) of section 3 of the impugned Act, as also cl. (c), expressly contemplate cases where there is a dispute as to the status of a person and if it has been decided in favour of the person claiming to be a permanent tenant he is to be deemed to be a permanent tenant for the purposes of the Abolition Act. True that thereafter the tenure holder cannot challenge the fact even in a collateral proceeding but that would be by reason of the provisions of section 5A itself which have not been challenged. No doubt after the commencement of the impugned Act no new proceedings under section 5A of the Abolition Act are permissible but that is because an alternative remedy is available under section 6 of the impugned Act. We must now examine section 4 in detail. It provides that a person who, on the date of the commencement of the Abolition Act was holding any tenure land and who, and whose predecessors in title, if any, were immediately before that date "for such continuous periods as aggregate to a total continuous period of 12 years or more" holding the same tenure land or any other land as a tenant be deemed to be a permanent tenant "unless it is proved by the tenure holder that he would not have been a permanent tenant on the basis of continued possession of the land under clause (b)". It is difficult to appreciate how it expands the definition of permanent tenant. True, it says that such a 455 tenant will be deemed to be a permanent tenant but it does not stop there. It goes on to say that he will be so deemed unless the tenure holder can show that he cannot be so deemed ! What does s.4 mean when it says that a tenant shall be deemed to be a permanent tenant ? Clearly, the legislature had in mind the provisions of section 83 of the Code which by virtue of section 16 of the Abolition Act apply to all ex taluqdari villages. To repeat, the impugned Act does not define "permanent tenant" anywhere and that it is from para 2 of section 83 of the Code that we must infer that a person whose tenancy is co extensive with that of the landlord is a permanent tenant. A tenure holder can get rid of the presumption raised by this provision if he can show the precise date of the commencement of the tenancy or if he can show that the tenancy is terminable in particular circumstances or on a particular date. We find nothing in section 4 which directly or indirectly modifies the requirements of the definition of "permanent tenant". No doubt, para 2 of section 83 of the Code sets out certain conditions for raising a presumption of permanent tenancy and section 4 of the impugned Act modifies them. But by doing so, it is difficult to see how it alters the basic requirements of a permanent tenancy as deducible from para 2 of section 83 of the Code. All that section 4 does is to alter the conditions for raising the presumption but that cannot amount to altering the definition of "permanent tenant. " According to Mr. Pathak, however, the section permits the landlord to prove only that the tenant and his predecessors in title were not in possession for a continuous period of twelve years or more, on the date of the commencement of the Abolition Act and that if they fail to prove this, the presumption raised by the section would be irrebuttable. Thus according to him section 4 makes a person who is in possession as a tenant for over twelve years, a permanent tenant even if the date of the commence 456 ment of his tenancy was known or the duration thereof was for a definite period. In our opinion, reading the section that way would lead to an absurdity. It is admitted on both hands that section 4 is intended to be availed of only in proceedings under s.6 to which a landlord would be a party. Clause (b) of that section which enacts the second condition which has to be fulfilled by a person before he can avail himself of the presumption under that section prescribes the minimum "duration" of a tenancy and does not deal with the question of its commencement or terms. Either the tenant fulfils that condition or he does not. If he does not fulfil it no further question arises and he must be deemed to be an ordinary tenant and nothing more. Therefore, if the tenant satisfies the condition, it would be meaningless to give to the tenure holder an opportunity of disproving the very thing which had been proved in his presence and upon proof of which the tenant has been able to enlist the presumption created by the section in his aid. Such a construction would render the provision absurd or at best useless. If the section was capable of being read in the way Mr. Pathak wants, it would read thus: "A person who has been in possession of tenure land at the commencement of the Abolition Act and was holding the same or any other land under the same tenure holder for a continuous period of 12 years he shall unless the tenure holder proves that he was not holding the land or lands for the continuous period of 12 years, be deemed to be a permanent tenant". Surely this would be making nonsense of the section. We are wholly unable to accept such a reading. We think, therefore, that the tenure holder can prove under the section that on the basis of twelve years continued possession the tenant would not have been a permanent tenant for other reasons. These other reasons must be the reasons which in spite of the 457 length of possession would show that he is not a permanent tenant because the tenancy commenced at a certain time or because a term had been agreed upon for the tenancy or fixed by usage. It may be, as the learned Solicitor General says, that the language used by the legislature is not felicitous. Even so, we think that it would not at all be far fetched to construe it as meaning that the tenure holder has the right to establish for getting over the presumption, that the tenancy originated at a definite point of time or was of a finite duration. The language used by the legislature is in our view capable of only such construction. Then it is said that even if section 4 is construed as giving an opportunity to the tenure holder to prove otherwise than by disproving that the tenant had been in continuous possession of land under him for twelve years that he is not a permanent tenant, that opportunity is illusory and really nonexistent and, therefore, section 4 in effect extends the definition of a permanent tenant. This contention is based on section 6 of the Act which, it may be stated gives the tenure holder a period of six months from the commencement of the impugned Act to move the Mamlatdar in writing for a declaration that the tenant is not a permanent tenant within section 4. It may be stated that the respondents concede that section 6 has that effect. We are, however, unable to agree that section 6 makes the opportunity to rebut the presumption raised under section 4 by continuous possession for twelve years illusory or non existent. We have first to point out that we do not find this point taken in the petitions. Secondly, we fail to appreciate why the six months ' time prescribed should be considered as if no time had really been given to the tenure holder which would be the effect of accepting the petitioners ' contention. 458 Since six months is not a short period, within that time it is easily possible for the tenure holder to move the required application. Then it is said that it is illusory because there may be a very large number of tenants and the tenure holder could be required to make numerous applications. Even so, we do not see why it should not have been reasonably possible to lodge these applications within the period allowed. All that the tenure holder has to do is to name the tenant concerned and state that he wants a declaration that the tenant is not a permanent tenant. It is also said that the tenure holder has to make the application in anticipation of the tenant making a claim to be a permanent tenant. But we are unable to appreciate how this by itself can make the opportunity to rebut non existent. We find no practical difficulty in the tenure holder making the application in anticipation. Furthermore, the question has to be considered according to the realities of the case. It is admitted in the petitioners ' affidavit in opposition that the preparation of the record of rights in respect of the tenants in the taluqdari villages commenced soon after the Abolition Act came into force, that is, soon after August 15, 1950. Many of the tenants have already been recorded as permanent tenants and since this could only have been done with reference to the provision of section 83 of the Code the petitioners can have no grievance against such entries. Further, section 3(b)(ii) of the impugned Act takes into account the fact that the proceedings in respect of the preparation of the record of rights were pending at the commencement of this Act. In these proceedings the tenure holder must already have objected of course where he thought fit to the tenant being recorded as a permanent tenant. These again would cover quite a number of cases. It is only in regard to the remaining cases that 459 applications under section 6 would be required. We think it right also to point out that the rights under section 4 of the impugned Act can be claimed by a tenant who pays for his holding an amount exceeding the assessment of the land. This we suppose would further reduce the number of tenants to whom section 6 would apply. We have no materials on which to show that these would form a very large number. As we have already stated the petitioners not having raised the present point out of section 6, they have not given any materials to show the cases of how many tenants are outstanding. Therefore, on the facts on this case, the petitioners cannot legitimately urge any practical difficulty in making applications under section 6. We may also state here that many claims by tenants to be permanent tenants must have long ago been raised because under section 5A of the Abolition Act, as originally framed, a tenant had five years from its commencement, that is, from August 15, 1950, within which to exercise his right. At the date of the impugned Act this period had been extended upto February 28, 1960. The impugned Act came into force on June 10, 1958. Therefore, at the date of the impugned Act the tenant had about one year and nine months within which to exercise the right given to him by section 5 A of the Abolition Act. It is apparently for this reason that section 6 of the impugned Act fixed the period of six months. It is true that later the period under s.5 A was extended but that was by Act XVIII of 1960 which came into force on April 8, 1960 and had, therefore, no bearing on the legislature fixing the time under section 6 of the impugned Act. According to one of our brethren the definition of "permanent tenant" is enlarged because even though the point of time when the tenancies of persons over certain lands commenced were known these persons are also included in the definition of "permanent tenant" under the impugned Act and cl. (b) of section 4 is said to do this. We may point out 460 that this was not one of the arguments advanced at the Bar and the respondents had no opportunity of meeting it. That apart, it is clear that this clause has to be read with Expl. II to section 5 A of the Abolition Act. As already stated section 5 A was not attacked as unconstitutional. Explanation II thereto provides as follows: "For the purpose of this section, a permanent tenant includes a tenant who holds a taluqdari land in exchange of another taluqdari land of which he was, and but for the exchange would have been a permanent tenant and who has been in continuous possession thereof since the date of exchange. " We may assume that the Explanation extends the definition of "permanent tenant" but its validity has not been challenged by the plaintiffs. Clause (b) of section 4 of the impugned Act merely takes note of the practice in tenure villages of changing the holdings of tenants from time to time and it is apparently for this reason that there was no challenge to section 4 of the impugned Act on this ground. It is only the persons who or whose predecessors in title were tenants in tenure villages from time immemorial who will get the benefit of the impugned Act and no others. No new persons will thus be brought in by section 4(b) and so it is idle to say that it enlarges the definition of permanent tenant. It is said that section 4 widens the definition of permanent tenant by including tenants the commencement of whose tenancies is definitely known. But does it do that ? The tenant in a tenure village is a person holding tenure land. It is not necessary that he and his predecessors in title should have been holding the same parcel of land since the commencement of their tenancy. The practice of exchanging parcels of lands prevailed in tenure villages and Expl. II to section 5 A has been founded upon it. Section 83 of the Code refers to the per 461 manency of the relationship of landlord and tenant and not to the existence of permanent tenancy with respect to a specific parcel of land. These provisions have to be read along with section 4 of the impugned Act because this Act cannot stand or was not intended to stand by itself. It adds certain provisions to the Abolition Act and the Code and these provisions must necessarily be assimilated to those of the main Act. Looked at this way it is clear that what section 4 contemplates is a person the commencement of the tenancy of whose predecessors in title is unknown but who has been in possession of the same or different parcels of tenure land for a period of not less than twelve years prior to the commencement of the Abolition Act. It may be possible to say when he came into possession of a parcel of land `X ' where it was taken by him within or more than twelve years of the commencement of the Abolition Act but that is not the same thing as saying that the relation between him and tenure holder came into existence on that date for the first time. If in fact it came into existence more than twelve years before the Abolition Act came into force, may be with respect to different parcels of land from time to time, he is entitled to be regarded as a permanent tenant, unless of course it can be shown by the landlord that he or his predecessor in title was first inducted as a tenant in the tenure village at a definite period of time or that the tenancy was of a finite duration. Thus, in our judgment, section 4 of the impugned Act does not expand the definition of a permanent tenant. Therefore, it cannot be said that it has the effect of taking away from the landlord any property which had vested in him on the tillers ' day. It may be that a tenant who, prior to the enactment of section 4, was merely recorded as an ordinary tenant because he could not show that the origin of his tenancy was lost in the mists of anti 462 quity and that now availing himself of this provision, he can get himself recorded as a permanent tenant by showing his continuous possession for twelve years. But section 4 does not, as we read it, say that he becomes a permanent tenant in these circumstances in every case. He would not become one if the landlord shows that his tenancy commenced on a particular date beyond those twelve years or is of a finite duration. Section 32H(1) does not confer upon the landlord the right to claim the price of occupancy at the rates prescribed in sub section (1)(ii) from a person because he is recorded as an ordinary tenant but only from one who is in fact other than a permanent tenant. If, in fact, he was a permanent tenant, or can be presumed to be a permanent tenant though till the coming into force of the impugned Act he was not recorded as such no right to claim the price of occupancy on the footing that he is not a permanent tenant of tenure land vested in the tenure holder by virtue of that provision. Section 87 A of the Tenancy Act renders section 32H(1)(i) inappropriate to such a tenant. No question of infringement of the right under article 19(1) (f) therefore arises in such cases. It was also said that section 6 of the impugned Act is void because it puts an unreasonable restriction upon the tenure holder 's right to hold property and, therefore, offends article 19(1)(f) of the Constitution. This point does not appear to have been taken in the petitions. In any case, if our construction of section 4 is right, then the impugned Act would be saved by article 31 A of the Constitution and its validity would not be open to attack on the ground that it violated article 19(1)(f) of the Constitution. Furthermore, it is difficult to appreciate how the tenure holder 's right to hold property is affected by section 6. His right of property with which we are 463 concerned, is as occupant of certain land having some permanent or other tenants under him. Section 5 A of the Abolition Act gives the permanent tenants the right to convert themselves into occupants and thereby cease to be tenants of the tenure holder. The validity of this provision is not at all challenged. A tenant may claim the benefit under this section only if he establishes that he is a permanent tenant. It is plainly conceivable that in many cases the tenure holder may dispute that the tenant is a permanent tenant. On such dispute being raised, the tenant has to prove that he is a permanent tenant. All that section 6 does is to fix a time limit within which the tenure holder shall have the right to dispute that certain permanent tenants are not permanent tenants. That does make those who were not permanent tenants, such tenants. Therefore, section 6 can in no way be said to affect the tenure holder 's right to property. Further, it would appear that in most cases the tenure holders themselves including the petitioners, have actually applied to the mamlatdars for a declaration in their favour under this provision and those applications are pending. The learned Solicitor General informed us that as a matter of fact upon the basis of the records made available by the tenure holders tentative entries were made in the record of rights immediately after the coming into force of the impugned Act and that thereupon the tenure holders have applied to the mamlatdar well within six months for a declaration under that provision. Thus, according to him the section affords and has afforded a real opportunity to the tenure holders to rebut the presumption created by section 4. We agree with him. To summarise, the position is that section 4 of the impugned Act by merely enacting the presumption does not take away any property of the tenure holder. His property such as it is, is left in tact. That section 464 does not confer any new property upon a tenant. It only comes to the rescue of a permanent tenant who is faced with the task of proving the nature of his tenancy, by raising a presumption of permanency in his favour. If in fact his tenancy is not permanent and has been extinguished by law but he is tentatively recorded or is sought to be recorded as permanent, the landlord can, in a proceeding under s.6(1) rebut the presumption by producing the documents in his possession or otherwise that the tenancy is not in fact permanent and, therefore, has been extinguished by the operation of s.32(1) of the Tenancy Act. If he proves this he will be entitled to claim compensation or purchase money at the rates permissible under section 32H(1)(ii) of that Act. That right of his is not affected in any way by the impugned Act. If he does not succeed in establishing that, then he will be only entitled to get purchase price at the rate provided in s.5A of the Abolition Act. That, however, would be by virtue of the operation of s.5A of the Abolition Act a provision which, as we have already said has not been challenged and not because any provision of the impugned Act deprives him of a right to claim a higher purchase price. The impugned Act is plainly applicable only to matters arising out of a relationship between landlord and tenant. Its provisions are not intended to apply where such relationship does not subsist. Therefore, the law must be held to be within the competence of the legislature by virtue of entry 18 of List II of the Constitution which is to the following effect : "Land, that is to say, rights in or over land, land tenures including the relation of landlord and tenant, and the collection of rents; transfer and alienation of agricultural land; land improvement and agricultural loans; colonization. " 465 There can be no question of regarding the impugned Act as colourable because it directly falls under Entry 18 and deals with matters which have a bearing upon the relationship of landlord and tenant. The law being thus within the competence of the Bombay legislature, Art.31(1) of the Constitution cannot be said to have been infringed. The first three points urged by Mr. Pathak accordingly fall to the ground. The fourth, fifth and sixth points are also based on the assumption that the impugned Act confers upon the persons whose tenancy rights were extinguished on April 1, 1957, rights of permanent tenancy. Upon the construction which alone can properly be placed on section 4 it cannot be said to confer any new rights on such persons. To repeat, the section applies to permanent tenants and permanent tenants alone. Therefore, the three contentions raised by Mr. Pathak do not fall for consideration. The seventh point urged by Mr. Pathak is that sections 4 and 5 of the impugned Act do not apply to other occupants under the Bombay Land Revenue Code, who are similarly situate and that the result of this would be that they will be entitled to higher purchase price than that permissible under section 5A of the Abolition Act. This, according to him, is a classification without any reasonable connection with the objects sought to be achieved by the statute. If our construction of section 4 is correct, article 31 A of the Constitution would protect the law and the petitioners would be precluded from challenging it on the ground that it infringes Art 14. Apart from that we may point out that though the impugned Act applies only to tenure villages and not to non tenure villages, there is, in fact a ground of distinction between villages of the two types. That ground is the availability or otherwise of the records. In the former all the relevant records were with the tenure holders themselves, but as stated in the statement of 466 "objects and reasons" were not produced by them and this created difficulties in completing the record of rights. In the latter the records having been maintained by the Government were available and therefore, no difficulty was experienced in completing the record of rights. The classification is thus based on the extent of the availability of the material for raising an inference or a presumption and, therefore, has a reasonable nexus with the object sought to be achieved by the impugned Act. Upon this view it is not necessary to consider the other points urged by Mr. Pathak on the authority of various decisions because the very basis of those arguments is, in our opinion, unsound. The petitions are, therefore, dismissed with costs. As there was only one common argument we direct that there will be only one set of costs. AYYANGAR, J. I entirely agree with the order proposed to be passed by my Lord the Chief Justice and my learned Brother S.K. Das J. The only reason for my separate judgment is because of the views I entertain regarding the import of the Bombay Land Tenure Abolition Laws (Amendment), Act 1958 (Bombay Act LVII of 1958) hereinafter referred to as the impugned Act, and in particular of section 4 thereof. The facts of the case and the relevant statutory provisions bearing upon it are set out in extenso in the judgments of my learned brethren and they do not need to be repeated Before entering on a consideration of the proper construction of the impugned Act it is necessary to state that I did not understand the learned Solicitor General to contest the position that if the impugned Act extended the definition of the term permanent tenant beyond that which obtained under s.83 of the Land Revenue Code, and brought into that category tenants who before then were comprehended within the class of "other tenants". 467 under s.32H(1)(ii) of Bombay Act 13 of 1956, its constitutional validity could be sustained, having regard to the decision of this Court in Sri Ram Ram Narain Medhi vs State of Bombay(1) holding that the effect of the 1956 legislation was to replace the relationship of landlord and tenant by that of vendor and purchaser as between the tenure holder and his tenants. His submission was accordingly directed to establishing that the impugned Act while not modifying in any manner the basic requirements needed to constitute a person a "permanent tenant" under section 83 of the Code, merely shifted the onus of proof on to the tenure holder on certain stated facts being found. It is this view which has found favour with my learned brother Mudholkar J. On the Construction of the relevant provisions of the impugned Act, he has held that the status or character of a permanent tenant or the definition of that term has not been altered in any manner, and that whereas before the impugned enactment the onus was upon the tenant to prove all the necessary elements to establish his claim to be a permanent tenant, the change effected by the Act of 1958 was to throw on the landlord the burden of proving the origin of the tenancy and its terminable character in the event of its being proved that the tenant had been in possession of his holding for twelve Dears before August 15, 1950. If this construction of the effect of the impugned Act were accepted I agree it would go a considerable way towards establishing the constitutional validity of the impugned provision. I feel myself however unable to accept the construction of s.4 of the impugned Act which was put forward before us by the learned Solicitor General for the State and Mr. Nathwani on behalf of the contesting tenants. To start with, the long 468 title of the Act itself states that the Act is one for further to "define" permanent tenants. No doubt, where the operative words of the provision are clear that only a shifting of the onus of proof is effected, the long title of the Act cannot be called in aid to vary their proper interpretation, but that is not the position here. On the other hand as I shall show presently, the operative provisions of the enactment appears to me designed to clearly carryout the purpose set out in the long title, viz., to "define" or to redefine the class of persons who shall be considered to be "permanent tenants" for the purposes of obtaining the benefits conferred upon "permanent tenants" under the law that existed before that date. The operative provisions of the impugned Act relevant to the present enquiry are sections 3, 4 and 6 and they read : "3. A person shall, within the meaning of the relevant Land Tenure Abolition Law (in the context the Taluqdari Abolition Act, 1949), be deemed to be . . a permanent tenant on the date of the abolition of the relevant land tenure, if his name has been recorded in the record of rights or other public or revenue record as. . permanent tenant in respect of any tenure land (a) on the date of the abolition of the relevant land tenure, or (b) in pursuance of orders issued during the course of any proceedings under the relevant Land Tenure Abolition law or, as the case may be, the Land Revenue Code, 1879 (i) before the commencement of this Act, (ii) after the commencement of this Act in cases in which inquiries were pending at the commencement of this Act, or 469 (iii) in pursuance of an order issued by the Mamlatdar in respect of an entry under section 6 of this Act." "4. For the purposes of the relevant Act specified in Part I of the Schedule, a person (a) who on the date of the commencement of that Act was holding any tenure land, and (b) who and whose predecessors in title, if any were, immediately before that date for such continuous periods as aggregate to a total continuous period of twelve years or more, holding the same tenure land or any other tenure land, as a tenant. under the tenure holder for the time being on payment of an amount exceeding the assessment of the land shall unless it is proved by the tenure holder that he would not have been a permanent tenant on the basis of continued possession of the land under clause (b), be deemed to be a permanent tenant of the land under clause (a) and all the provisions of that Act shall apply to him as they apply to a permanent tenant. Explanation. The assessment for the purpose of this section shall be reckoned as provided in clauses (a) and (b) of section 5." "6. (1) The rights of . . .(a) permanent tenant under sections 4 and 5 shall be entered in the record of rights unless the tenure holder applies in writing to the Mamlatdar within six months from the date of the commencement of this Act for a declaration that any holder or tenant under his is not. . a permanent tenant. (2) Any such application shall be disposed of as if it were an application in respect of a 470 disputed case under section 135D of the Bombay Land Revenue Code, 1879." to extract only the portion pertinent to the controversy before us. It will be seen that by force of section 3 persons are deemed to be permanent tenants under the Taluqdari Abolition Act, 1949, if the name of such tenant is recorded in the record of rights or other public records as "a permanent tenant" in any one of the three events specified in cls. (a), (b) and (c) of the section. In so far as reference is made to persons already recorded in the record of rights before the passing of the Act, the characteristics for determining who a permanent tenant was would obviously have been based on the pre existing law and they would have been permanent tenants under the law apart from the "deeming" provision. The position of those recorded under cl. (b) might be similar, and it is unnecessary to enter into a discussion as to whether in cases where an enquiry commenced before the commencement of the Act but is completed thereafter, the tests brought in by section 4 of the Act could be availed of to determine the status of the tenant. If one proceeded on the assumption that the provisions of the impugned Act are not to be brought in into an enquiry already started there would be no difference between cls. (a) and (b) of section 3 and in both cases they would be actual and not statutorily deemed "permanent tenants". Sub cl. (c) however stands on a different footing. It brings in, if my construction of section 4(b) is correct, a new class of "permanent tenants" persons who were before the date of the impugned enactment non permanent tenants in whom by virtue of the provisions of Bombay Act 13 of 1956 the interest of the landlord stood transferred and by whom the purchase price specified in s.32H(1)(ii) was payable, into the category of "permanent tenants." 471 Section 3(c) refers to an entry made by a Mamlatdar under section 6, but when one looks at section 6 he is referred to section 4 as containing or defining the class of tenants whom the Mamlatdar is enjoined to enter in the revenue records as a "permanent tenant. " Turning now to section 4, it would be seen that persons are deemed to be "permanent tenants" if they satisfied three cumulative conditions : (a) they must be holding tenure land on the date of the commencement of that Act, viz., The Taluqdari Abolition Act, i.e., on August 15, 1950, (b) they or those from whom they claim should immediately before August 15, 1950, have been continuously in possession of that or any other tenure land for twelve years, (c) the amount of rent payable by them should exceed the assessment leviable on the land calculated according to section 5. The effect of condition (a) would be to exclude from the category of permanent tenants those who came into occupation or were inducted on the land of which they could claim to be permanent tenants, after August 15, 1950. But every tenant who was in possession of tenure land on that date could apparently qualify for obtaining the status of a permanent tenant, being deemed to be such, if he satisfied the other two conditions. As regards condition (b), there is obscurity and contradiction attending the expression "continuous periods aggregating to a total continuous period of twelve years". Aggregation would obviously mean an addition of integers, and when units of time are the integers as is apparent from the context, in plain words it would mean the addition of broken periods. To posit continuity in such a case, might possibly suggest that it refers to cases where a tenant is in possession of different parcels of tenure land throughout the twelve year period, though he is not in possession of any particular parcel continuously for a period of 12 years, and that the terms of the section would be satisfied and he would be deemed to have been in "continuous 472 possession" of the land of which he was in possession at the commencement of the Taluqdari Abolition Act for the purpose of qualifying for permanent tenancy of that parcel. An analysis of the circumstances attendant on this condition would reveal the following : (1) Let us take it that during the period twelve years before August 15, 1950 a tenant had been in possession of three distinct parcels of tenure land `A ', `B ' and `C ' at different periods but continuous, i.e., there being no point of time at which he was not in possession of one or the other of these three parcels and that on the date of the commencement of the Act he is in possession of parcel `C '. It is possible that such a situation might arise from exchange of holdings with the consent of the tenure holder by a person who was a permanent tenant under the existing law. But the provision on its terms is not confined to exchanges by such tenants, but is of wider application. If the proper construction of this unclear provision of section 4 be as above, any tenant who satisfied the other conditions of the section, would be deemed to be a permanent tenant in respect of parcel `C '. It will at once be seen that the origin of his tenancy of holding `C ' is ex concessis known. Surely, such a tenant would not be a permanent tenant within section 83 of the Bombay Land Revenue Code. It has only to be added that he would not fall within the definition of a permanent tenant even under section 2(10A) of the Tenancy Act inserted by Bombay Act 13 of 1956. The argument, therefore that section 4 was merely intended to and provided a rule of evidence for determining who a permanent tenant was under section 83 of the Bombay Land Revenue Code, 1879 and did not extend such category of persons by an artificial definition, would appear to be negatived even by the first paragraph of section 4(b). This conclusion is strengthened by the provision made at the end of section 4(b) of the impugned Act as regards the grounds upon which the landlord or 473 the tenure holder could disprove the right of a tenant to the status of a permanent tenant. That provision reads: "Unless it is proved by the tenure holder that he would not have been a permanent tenant on the basis of continued possession of land under clause (b). " The learned Solicitor General submitted that to read this portion of section 4 (b) as meaning that the landlord has to disprove what the tenant has already proved would be to give it no meaning at all and that consequently it should be held that in order to give some rational meaning to the words quoted they refer to tenure holder having to prove that the tenant was not a permanent tenant under section 83 of the Bombay Land Revenue Code. To put it differently, the construction suggested was that on the conditions laid down in section 4(b) being fulfilled, viz., continuous possession of tenure land by a tenant for twelve years computed as described, the onus was shifted to the tenure holder to prove that the tenant did not fall within the category of persons described in section 83 of the Code. I find myself unable to accept this interpretation of the section. Even if one started with the presumption that what the impugned Act sought to achieve was not to "define" a permanent tenant but merely to shift the onus of proving the status the conditions of section 83 of the Code being assumed to be still the determinant, I do not find words in section 4 to support the interpretation which the learned Solicitor General desires the Court to accept. There is no reference to section 83 in the impugned Act and the class of persons who are termed "permanent tenants" are expressly stated to be those who are deemed to be such. That itself would be some indication that the class is an artificial creation brought into existence by the Act. That apart, I have already pointed out that the opening words of the 474 first paragraph of section 4(b) contemplate cases where the origin of the tenancy of the parcel in respect of which permanent tenancy is claimed is known. Lastly, the words in which the content of the right of the tenure holder to dispute the "deemed" permanent tenancy are couched are wholly incompatible with his having a right to establish that the tenant does not satisfy the requirements of section 83 of the Code. The words used are "that the tenant would not have been a permanent tenant on the basis of continued possession of land under clause (b)". The conditions on the fulfilment of which a person is deemed to be a permanent tenant are, as already pointed out, three and of these two are set out in sub cl. (b), viz., the "continuous" possession of tenure land and the rent of the land being higher than the revenue assessment. In my opinion the argument about the irrationality of the literal construction of the quoted words or section 4(b) stems from the assumption that section 4 contemplates an enquiry or proceeding initiated by the tenants who by evidence establish the matters set out in section 4 and it is on that basis that the submission is made that the legislature could not have made a provision for the same matters being disproved by the tenure holder. Even if the basis be assumed to be correct, I do not see any absurdity in the provision. But that apart, in my judgment section 4(b) does not contemplate or provide for any application by the tenant and therefore there is no question of the tenant having established that the conditions of section 4(b) have been satisfied. Section 4(b) enacts a positive rule of law by which a person in possession of a holding of tenure land on August 15, 1950 is "deemed" to be a permanent tenant on the fulfilment of three conditions, the tenure holder being entitled to establish that the conditions of that section have not been satisfied when proceedings for that purpose are initiated by him. The 475 provision for proceedings being initiated by the tenure holder to take advantage of the right granted to him by section 4(b) is to be found in section 6. What has just been stated is amply borne out by the terms of section 6, for it enacts that the rights of a permanent tenant under section 4 "shall be entered in the record of rights unless the tenure holder applies in writing to the Mamlatdar within six months from the commencement of the Act of a declaration that the tenant under him is not a permanent tenant" (to quote only the material words). It will therefore be seen that the concept of permanent tenant as envisaged under section 4 is incorporated into the texture of section 6. Every person who satisfies the definition of a permanent tenant under section 4 is therefore automatically entitled without application by him, to be entered in the revenue records as a permanent tenant by the Mamlatdar unless the tenure holder applies in writing objecting to the entry. Obviously the objections which he could raise and which would be the subject of adjudication under section 6 are those set out as being open to him under section 4. In this connection it has to be noticed that section 6 does not specify the grounds upon which the tenure holder might object to a tenant being treated as a permanent tenant and it is on the absence of those provisions that the learned Solicitor General bases his argument suggesting that the objections of the tenure holder would extend to disproving that the tenant was a permanent tenant under section 83 of the Code. It is not possible to accede to this submission. It is common ground that no enquiry is contemplated under section 4(b) and that the right of the tenure holder to object to the entry of the tenant as a permanent tenant is by taking advantage of the provision in section 6. It would therefore follow that section 4(b) and section 6 are integrated provisions, the one laying down the grounds of objection open to the tenure holder, and section 6 making provision for the forum in which and 476 the procedure by which such objections could be urged. To put the matter slightly differently section 4(b) specifies the grounds of objection open to a tenure holder but does not indicate where and in which proceeding the objections could be raised while section 6 indicates that the authority to decide is the Mamlatdar and that the proceeding would be initiated by an objection petition filed by the tenure holder. Both section 4(b) and section 6 would be truncated unless they were read as forming an integrated whole. It is in this manner that a reconciliation is possible between the terms of sections 4 and 6 which so to speak form together provision for determining, after investigation. the class of persons who shall be entitled to claim rights as permanent tenants. Section 4 having defined a permanent tenant in positive terms, section 6 steps in and sets up a procedure and creates a forum in which that positive provision might be tested and if not displaced would be given effect to. In the view I have expressed the reference to the enquiry being under section 135D of the Code would not make any difference, because the officials and Tribunals or Courts vested with authority under section 135D of the Code and the related provisions would have still to consider whether the tenant had or had not qualified to be a permanent tenant by the application of the criteria enacted by section 6. I am therefore clearly of the opinion that the entire object and purpose of the impugned enactment which is given effect to by its operative provisions enacts not a rule of evidence for determining who permanent tenants are under the pre existing law, but to define, create and as it were, add a new class of "permanent tenants", i.e., those who satisfy the requirements of section 4. If this were the proper construction of the impugned enactment it was not seriously contested that the enactment would be void and unconstitutional and liable to be struck down. I agree therefore that these petitions should be allowed. 477 BY COURT : In accordance with the opinion of the majority, these petitions are allowed with costs. As the petitions have been heard together there will be only one hearing fee.

The petitioners, who were tenure holders, challenged the constitutional validity of the Bombay Land Tenure Abolition Laws (Amendment) Act, 1958 and in particular sections 3 and 4 read with section 6 of that Act, as infringing their fundamental rights guaranteed by articles 14, 19 and 31 of the Constitution. Their case in brief was that those provisions by making certain non permanent tenants permanent as from the commencement of the Bombay Taluqdari Tenure Abolition Act, 1949, enabled them to acquire occupancy right by payment of six times the assessment or the rent under section 5A of that Act instead of 20 times to 200 times the assessment under section 32H of the Bombay Tenancy and Agricultural Lands Act, 1948, 412 as amended in 1956, and thereby substantially deprived the petitioners of the rights acquired by them on the 'tillers ' day, April 1, 1957, when they ceased to be tenure holders. It was urged that the impugned Act was a piece of colourable legislation in that it had confiscated, under the guise of defining a permanent tenant or changing a rule of evidence, a large part of the purchase price the petitioners were entitled to from their tenants, and that the State Legislature had not the competence to enact it as it was not saved by article 31A of the Constitution. ^ Held, (Sarkar and Mudholkar, JJ., dissenting), that ss.3, 4 and 6 of the Bombay Land Tenure Abolition Laws (Amendment) Act, 1958, in so far as they deemed some tenants as permanent tenants in possession of Taluqudari land, were unconstitutional and void. Under the guise of changing the definition of a permanent tenant and changing a rule of evidence, they really reduced the purchase price that the petitioners were entitled to receive under section 32H of the Bombay Tenancy and Agricultural Lands Act, 1948, as amended in 1956, from some of their tenants on the "tillers ' day. " Per Sinha, C.J., and Das, J. There can be no doubt that section 4 of the impugned Act, properly construed, created a new class of permanent tenants not contemplated by section 83 of the Bombay Land Revenue Code, 1879, and not in existence on the 'tillers ' day", and the combined effect of sections 3, 4 and 6 of the impugned Act was that if the tenure holder did not make an application under section 6 within six months from the commencement of the impugned Act for a declaration that a tenant under him was not a permanent tenant, the name of the tenant would be recorded as a permanent tenant if he fulfilled the conditions laid down by section 4 and thereafter he would be deemed under section 3 to be a permanent tenant and under section 4 all the provisions of the Taluqdari Abolition Act 1949, would apply to him. The result of this combined effect would be to deprive the tenure holder of any real opportunity of contesting the claims of the tenant and deprive him of the purchase price prescribed by section 32H of the Bombay Tenancy and Agricultural Lands Act, 1948. The right of the petitioners to the said purchase price from those of their tenants who were non permanent on April 1, 1957, was a right of property guaranteed by article 19 (1) (f) and the impugned sections adversely affected that right with retrospective effect Section 6, tested in the light of article 19(5), could not be said to impose a reasonable restriction in the interest of the general public. 413 Bombay Dyeing and Manufacturing Co. Ltd. vs State of Bombay; , , applied. Sri Ram Ram Narain Medhi vs The State of Bombay. [1959] Supp. 1 S.C.R. 489, referred to. Article 31A of the Constitution had no application. The relation between the tenure holders and the tenants had changed from that of landlord and tenant to that of creditor and debtor on April 1, 1957, and the impugned Act which affected such rights, did not come within the protection of that Article. In view of the true scope and effect of sections 3, 4 and 6, the impugned Act could not fall within any entry of List II or List III of the Seventh Schedule to the Constitution and was a piece of colourable legislation. K.C. Gajapati Narayan Deo vs State of Orissa ; , referred to. Per Sarkar and Mudholkar, JJ. Section 4 of the impugned Act did not expand the definition of a permanent tenant and did not take away any property that was vested in the landlord on the "tillers day". Nor did it confer any new property on the tenant. It only applied to and rescued a permanent tenant faced with the task of proving the nature of his tenancy, by raising a presumption of permanency in his favour. If in fact his tenancy was not permanent and had been extinguished by law but he was tentatively recorded as permanent, the landlord could rebut the presumption in a proceeding under section 6 (1) by producing the documents in his possession or otherwise by showing that the tenancy was not in fact permanent and, therefore, had been extinguished by section 32(1) of the Bombay Tenancy and Agricultural Lands Act, 1948, and claim compensation or the purchase money under section 32H(1)(II) of the Act, that right of his not having been affected in any way by the impugned Act. If he failed, he would get the purchase price according to section 5A of the Bombay Taluqdari Tenure Abolition Act, 1949, which would not be and was not challenged. Dhirubha Devisingh Gohil vs State of Bombay, ; , referred to. The impugned Act dealt with matters arising out of the relationship between landlord and tenant. Its provisions were not intended to apply where such relationship did not subsist. The Act was, therefore, within the competence of the Legislature under entry 18 of List II of the Seventh Schedule to the Constitution and was thus not a piece of colourable legislation. 414 There was, therefore, no infringement of article 31(1) and the Act was within the protection of article 31A of the Constitution and its Constitutional Validity could not be challenged under article 14 and 19(1)(f) of the Constitution. Held, further, that the distinction made between tenure villages and non tenure ones was a classification based on the extent of availability of the material for raising the inference or the presumption and such classification had a reasonable nexus with the object sought to be achieved by the Act. Per Ayyangar, J. There was no basis for the argument that section 4 of the impugned Act merely intended to provide a rule of evidence for determining who was a permanent tenant under section 83 of the Bombay Land Revenue Code, 1879, and did not extend the category of such tenants. It enacts a positive rule of law by which a person in possession of holding of a tenure land must be "deemed" to be a permanent tenant on fulfilment of the three specified conditions. This is evident from the provisions of section 6(1) under which every person who satisfied the definition of a permanent tenant under section 4 was entitled automatically and without applying for to be entered as a permanent tenant in the record of rights by the Mamlatdar unless the tenure holder filed an objection in writing. Obviously such objection could only be on grounds open to him under section 4. Section 4(b) and s.6(1) of the impugned Act had to be read together as forming an integrated whole. The entire object and purpose of the impugned enactment was not, therefore, to enact a rule of evidence for determining who were permanent tenants under the pre existing law but to define and create a new class of permanent tenants who satisfied section 4 of the Act.

Civil Appeal No. 766 of 1957. Appeal by special leave from the judgment and order dated January 31, 1966, of the, Punjab High Court in Civil Writ Petition No. 30 of 1956. R. section Narula, for the appellants. B. K. Khanna and P. D. Menon, for the respondents. section L. Pandhi, for the interveners. January 24. The Judgment of the Court was delivered by WANCHOO, J. This is an appeal by special leave against the order of the Punjab High Court 735 summarily rejecting a petition filed by the appellants. under article 226 of the Constitution. The brief facts necessary for present purposes are there. The appellants migrated in 1947 from what is now West Pakistan and settled in two villages, viz., Sheikhapind and Kotla. They were given temporary allotment of agricultural land in the two villages under the East Punjab Evacuees ' (Administration of Property) Act, (No.XIV of 1947) then in force. Thereafter a scheme was formulated in 1948 for quasi permanent allotment of agricultural land to owners of land in West Pakistan after the East Punjab Refugees (Registration of Claims) Act, (No.VIII of 1948) was enacted. In July 1949, a notification was issued stating the condition under which allotment of agricultural land would be made to displaced person from West Pakistan. This allotment was quasi permanent in the sense that it was to remain in force so long as the land was to remain vested in the Custodian of Evacuee Property. In pursuance of this notification, land was allotted in the two villages to the appellants on quasi permanent basis in 1949 and the appellants have remained in possession thereof eversince. Originally land was classified into two kinds, namely, (i) urban and (ii) agricultural land. Later in 1949, however, a third Classification, namely sub urban was also introduced in practice with respect to agricultural land in the neighborhood of certain towns and a notification seems to have been issued with respect to that specifying the villages land in which was considered to be a sub urban (vide Chap. V of Land Settlement Manual by Tarlok Singh). But the two villages in which land was allotted to the appellants were not included in the notification with respect to sub urban land. In August 1950 after the quasi permanent allotment in favour of the appellants had been 736 made, the Revenue Assistant (Rehabilitation) Jullundur proposed that these two villages should also be classified as sub urban, the consequence of which would have been to reduce the area of land given to the allottees therein. The appellants objected before the Director General of Rehabilitation to the villages being graded as sub urban The Director General called for a report from the Revenue Assistant (Rehabilitation) and eventually passed an order on January 12, 1951 that it was not desirable at that stage to cause any disturbance to the allotments made in these two villages by declaring them sub urban and that the status quo should continue. This however did not end the matter and in February, 1952 the Director of Rehabilitation passed an order in effect declaring these villages as sub urban with the result that the allotment made to the appellants would have to be reduced. It also appears that some order was passed in April, 1952 on paper allotting the extra land which would be released from the allotment of the appellants to other persons who have appeared as interveners in this appeals. But this order remained merely on paper and has not been carried out so far. When the appellants came to know of the order of February 29, 1952, they filed a revision before the Custodian General for setting aside that order. The revision came up before the Deputy Custodian General for hearing in January 1956. By then however certain changes in the law and the Rules had been made. Firstly, there was an amendment in r. 14 (8) of the Administration of Evacuee property (Central) Rules framed under the Administration of Evacuee property Act, (Central Act XXXI of 1950). Further, the Displaced persons (Compensation and Rehabilitation) Act, Central Act XLIV of 1954, (hereinafter referred to as the Act) had been passed. Under the amendment to r. 14 power was given for cancellation or variation of any 737 allotment of rural evacuee property on a quasi permanent basis, where the allotment was to be cancelled or varied in accordance with the general or special order of the Central Government. It appears that in the meantime correspondence passed between the Punjab Government and the Central Government and an order under the amended r. 14 (6) (iii) (d) was obtained on October 11,1955. Therefore, when the revision came up before the Deputy Custodian General he held that in view of r. 14 (6) (iii) (d) of the Rules it was open to the Central Government by special order to direct cancellation or variation of the allotment made in this case in favour of the appellants and that the Central Government had on the representation of the Punjab Government agreed to declare these two villages as sub urban by its order dated October 11, 1955; therefore he held that whatever was being done after October 11, 1955 was in pursuance of the order of the Central Government. He therefore held that the impugned order of February 29, 1952, even if it was revisable, no longer held the field and action was to be taken in future under the order of the Central Government passed on October 11, 1955. Therefore, the revisions had become infructuous and he dismissed them. Then followed the writ petition by the appellants in the Punjab High Court, which was dismissed summarily. As leave was refused by the High Court, the appellants applied for special leave to this Court, which was granted; and that is how the matter has come up before us. The main contention on behalf of the appellants before us is that after the coming into force of the Act and the notification made there under on March 24, 1955 under section 12, the land allotted to the appellants in the two villages ceased to because property and became part of the compensation pool created thereunder and therefore the Central 738 Government had no power left to act under the Central Act XXXI of 1950 and the Rules framed thereunder. In consequence the order passed, by the Central Government on October 11, 1955 on the basis of which the Deputy Custodian General rejected the revision petitions filed on behalf of the appellants was not within the competence of the Central Government and no action could be taken by virtue of that order declaring the two villages as sub urban. Therefore it was not open to the authorities under the Central Act XXXI of 1950 to take any action under that order with the object of varying the allotment made in favour of the appellants by reducing the area allotted to them. It is further urged that whether further action has to be taken after the notification dated March 24, 1955 can only be taken under the Act and that no such action has in fact been taken, We are of opinion that there is force in this contention of the appellants and it must prevail. Section 12(1) of the Act provides that "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 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 a acquire such evacuee property in pursuance of this section". Sub section (2) then provides that "on the publication of a notification under sub section (1), the right, title and interest of any evacuee in the evacuee property specified in the notification shall. . be extinguished and the evacuee property shall vest absolutely in the Central government free from all encumbrances". Sub section (4) provides that all evacuee property acquired under this section shall form part of the 739 compensation pool. Section 14 provides for the constitution of a compensation pool. Section 16 gives powers to the Central Government for the management of the compensation pool, including the appointment of such officers as it may deem fit (referred to as managing officers) or constitution of such authority or corporation, as it may deem fit (referred to as managing corporations). Section 17 provides for functions of managing officers and managing corporations. Section 19, which is important, provides that "notwithstanding anything contained in any contract or any other law for the time being in force but subject to any rules that may be made under this Act, the managing officer or managing corporation may cancel any allotment or terminate any leases or amend the terms of any lease or allotment under which any evacuee property acquired under this Act is held of occupied by a person, whether such allotment or leases was granted before or after the commencement of this Act". Rules have been framed under the Act specifying the circumstances under which a managing officer or a managing corporation may cancel an allotment or terminate a lease or vary the terms of any such lease or allotment (see r. 102). It is not in dispute that the evacuee property in these two villages was notified under s.12 of the Act on March 24, 1955. The consequence of that notification is that all rights. title and interest of the evacuee in the property ceased with the result that the property no longer remained evacuee property. Once therefore the property ceased to be evacuee property it can not be dealt with under the Central Act No. XXXI of 1950 or the Rules framed thereunder. The property in these two villages became part of the compensation pool after the notification of March 24, 1955 and could be deal with under the provisions of the Act and any variation or cancellation of any lease or allotment thereafter could only be made under s.19 740 of the Act. This is the position which emerges on a consideration section 12, 14, 16 and 19 of the Act after the notification under section 12(1) was made with respect to the evacuee property in these two villages on March 24, 1955. This view has been taken by the Punjab High Court in Balmukand vs The Punjab State. The same view has also been expressed by this Court in Major Gopal Singh vs Custodian, Evacuee Property, where it was held that from the date of the notification under section 12, the Custodian by reasons of the divesting of the property becomes functus officio with respect to it and cannot rectify any error made by him in the past in the matter of cancellation of allotment. It follows therefore that when the notification of March 24, 1955 was made and the evacuee property in these two villages ceased to be evacuee property and became part of the compensation pool it could only be deal with under the Act and if any variation or cancellation of allotment was to be made it could only be done under the provisions of section 19 of the Act and there was no power left in the Central Government to act under r. 14(6)(iii)(d) of the Rules framed under the Central Act XXXI of 1950 with respect to this land after the notification of March 24, 1955. The order of the Deputy Custodian General of January 1956 shows that further proceedings with respect to this land are contemplated under the order of October 11, 1955 passed by the Central Government under r. 14(6)(iii)(d). As however that order was passed after March 24, 1955, when the power of the Central Government to act under the Central Act XXXI of 1950 had ceased on the evacuee property in these two villages becoming part of the compensation pool, that order must be set aside and no further proceedings can be taken under that order. We order accordingly. The appellants will get their costs. 741 We should however like to make it clear that we express no opinion on the controversy between the appellants and the interveners who are left to such remedies as may be available to them under the law.

The appellants migrated to India in 1947 from West Pakistan. To begin with, they were given temporary allotment of land in two villages. In 1949, land was allotted to them on quasi permanent basis, and they have remained in possession of the same eversince. Originally, land was classified into two kinds: urban and agricultural land. Later on, a third classification was introduced, known as sub urban land. The two villages in which land was allotted to the appellants were not included in the notification with respect to sub urban land. In February, 1952, the Director of Rehabilitation passed and order declaring those villages as 734 sub urban land. The result of the order was that the allotment made to the appellants was to be reduced. The appellants went in revision to the Custodian General, and their revision petitions were dismissed on the ground that the view of Rule 14(6)(iii)(d) of the Rule it was open to the Central Government by a special order to direct cancellation or variation of the allotment made in favour of the appellants, and the Central Government has on the representation of the Punjab Government agreed to declare the two villages in question as sub urban by its order dated October 11, 1955. The appellants filed a writ petition in the High Court but that was dismissed summarily. The have come in appeal to this Court by special leave. ^ Held, that when the notification of March 24, 1955, was made under section 12 of the placed Persons (Compensation and Rehabilitation) Act, 1954, the evacuee property in those villages ceased to be evacuee property and became a part of the compensation pool. That property could only be dealt with under the Act of 1954. If any variation or cancellation of allotment was to he made that could be done only under the provisions of section 19 of Act of 1954. There was no power left in the Central Government to act under Rule 14(6)(iii)(d) of the Rules framed under the with respect to that land after the notification of March 24, 1955. Balmukand vs The State of Punjab, I.L.R. 1957 Punjab 712 and Major Gopal Singh vs Custodian of Evacuee Property, ; , followed.

Civil Appeal No. 559 of 1960. Appeal by special leave from the judgment and order dated May 1/14, 1957, of the Income Tax Appellate Tribunal of India (Delhi Bench) in I.T.A. No. 2070 of 1956 57. K.N. Rajagopal Sastri and D. Gupta, for the appellant. Radhey Lal Agarwal and P.C. Agarwal for the respondents. 867 1962. January 29. The Judgment of the Court was delivered by HIDAYATULLAH, J. This is an appeal against the order of the Income tax Appellate Tribunal, Delhi Bench, dated May 1/14, 1957, by which the tribunal, reversing the order of the Appellate Assistant Commissioner, held that a loss arising from the sale of certain shares by the respondent Company was a capital loss. Subsequent to the order of the Tribunal impugned here, the Commissioner of Income tax, New Delhi, who is the appellant before us, had moved the Tribunal for a reference to the High Court on certain questions of law said to arise out of the order of the Appellate Tribunal. That application was found to be barred by one day, and since, under the law, the Tribunal had no jurisdiction to extend the time, the application was dismissed. Against the decision of the Tribunal, an application was filed in the High Court under section 66(3) of the Income tax Act; but the High Court dismissed the application, agreeing with the Tribunal that the application to the Tribunal for a reference was barred by time. The Commissioner of Income tax then applied for special leave against the order passed by the Tribunal in the appeal before it, and the present appeal, with special leave, has been filed. Before we examine the merits of the case, we shall deal with a preliminary objection raised on behalf of the respondent that the appeal is incomepetent, in view of the decision of this Court in Chandi Prasad Chokhani vs State of Bihar (1) where it was held that this Court would not entertain an appeal directly from an order of the Tribunal by passing the decision of the High Court, except in very exceptional circumstances. The appellant relies upon the decision of this Court in Baldev Singh vs Commissioner of Income tax (2), and contends 868 that the exceptional circumstances existing in the latter case and adverted to in the former, govern the present case. The facts relating to the filing of the application for reference together with the relevant dates are these: The Tribunal 's order was passed by two learned Members, who signed their respective orders on different dates. The Accountant Member signed his order on May 1, 1957, and the Judicial Member, on May 14, 1957. The notice of the order was sent to the Commissioner of Income tax, New Delhi, and reached his office by registered post on July 15, 1957. It was received by one Motilal Pathak, a clerk in the office of the Commissioner. Motilal 's affidavit shows that, he suddenly fell ill, and had to take casual leave for the day. He returned to the office the next day, and dealt with the notice received from the Tribunal. By a mischance, which is easy to appreciate, the date stamp of the receipt of the papers was affixed on the 16th, and bore that date instead of the real date, viz., the 15th, on which the papers had actually been received. Relying upon the date stamp, everybody took it for granted that limitation would expire on the 60th day, counting time from July 16, 1957. The application was filed on the last day of limitation on that supposition. Actually, the application was barred by a day. The Income tax Tribunal, therefore, dismissed the application on December 4, 1957. The decision of the Tribunal was unsuccessfully challenged before the High Court. It is evident that the decision of the Tribunal was quite correct, and the Tribunal had no option but to dismiss the application, since the law gives no jurisdiction to the Tribunal to extend limitation, as is done under section 5 of the Indian Limitation Act. This Court then granted special leave against the order of the Tribunal passed in the appeal 869 before it, and the question is whether the appeal should be heard or the leave revoked, in view of the decision in Chokhani 's case (1). In Chokhani 's case (1), the attempt was to bypass the decision of the High Court on a question referred to the High Court for decision and also another decision of the High Court that no other point of law arose from the order of the Tribunal. It was held that this Court would not allow the High Court to be by passed, and that an appeal from the decision of the Tribunal in the circumstances was incompetent. A similar view was again expressed in two other cases, viz., Indian Aluminium Co. Ltd. vs Commissioner of Income tax (2) and Kanhaiyalal Lohia vs The Commissioner of Income tax (3). In all the three cases, reliance was placed by the appellants therein upon the decisions of this Court in Dhakeswari Cotton Mills, Ltd. vs Commissioner of Income tax (4) and Baldev Singh vs Commissioner of Income tax (5) It was pointed out in the judgments of this Court that the two cases relied upon were decided on the special circumstances existing there. In the first, there was a question of breach of the principles of natural justice, which could not be raised otherwise than by an appeal with the special leave of this Court. In the second case, it was pointed out that limitation was lost by the party through no fault of his, inasmuch as a letter was unduly delayed in post. In our opinion, in the present case also, special circumstances which justified the grant of special leave in Baldev Singh 's case (5), exist. There was a combination of circumstances which led to the filing of the application a day late, but in circumstances showing that the default was not due to any negligence on the part of the Commissioner of Income tax. The receipt of the notice on July 15 is admitted; but the affixing of the date stamp on the 16th was due to the failure of the 870 clerk to deal with the notice on the 15th because he fell ill and had to leave the office. It is common knowledge that date stamps are altered every day in the office, and this is done mostly by a very junior employee. The affixing of the date stamp on the 16th and the notice consequently bearing that date went unnoticed, and relying upon the date stamp, the appeal was filed, though on the last day of limitation but within time. In these circumstances, it is difficult to say that the Commissioner of Income tax was negligent and the negligence, if any, on the part of the clerk in affixing a wrong date stamp is excusable, if one considers his illness and his absence from the office on the 15th. In our opinion, this case comes within the rule of Baldev Singh 's case (1) and an appeal direct to this Court from the Tribunal 's order is justified by the special circumstances. By this appeal, no decision of the High Court can be said to be bypassed, because the decision of the High Court related to the correctness of the decision of the Tribunal on the question of limitation, which is not a question which is sought to be raised in an indirect way by the present appeal. We, therefore, overrule the preliminary objection. The assessee Company is the National Finance Ltd., New Delhi. It is a public limited Company which was incorporated in 1943. It deals in shares and securities and also as financiers. The present case arises from a deal in 3,000 shares of the Madhusudan Mills Ltd., Bombay, by the assessee Company. In the year of account, May 1, 1949, to April 30, 1950, corresponding to the assessment year, 1951 52, the assessee Company sold these shares suffering a loss of Rs. 5,48,712 8 0, which it claimed as one on the sale of its stock in trade. The Income tax Officer and the Appellate Assistant Commissioner held it to be a capital loss. The 871 Appellate Tribunal, Delhi Bench, reversed the decision, and held in favour of the assessee Company. The only question in this appeal is whether the decision of the Tribunal is right. The assessee Company belongs to a group of Companies controlled by one Lala Yodh Raj Bhalla and certain persons associated with him. It is convenient to describe these persons as the 'Yodh Raj Bhalla group '. These Companies are (1) Jaswant Sugar Mills Ltd., (2) Jaswant Straw Boards Ltd., (3) National Finance Ltd., (4) National Construction and Development Corporation Ltd., (5) Ganesh Finance Corporation Ltd., and (6) Raghunath Investment Trust Ltd. The interrelation of these. Companies is very intimate, and they are practically owned by the 'Yodh Raj Bhalla group '. To understand this, the following analysis of the shareholdings of these Companies must be sufficient: (1) Jaswant Sugar Mills Ltd. 2,00,000 shares (i) Jaswant Straw Board Ltd. 44,845 (ii) National Finance Ltd. 67,390 (iii)National Construction and Development Corporation Ltd. 47,800 _______ 1,60, 035 (i.e. over 80 per cent) (2) Jaswant Straw Board Ltd. 6,176 shares. (i) National Finance Ltd. 4,783 (ii) National Construction and Development Corporation Ltd. 500 _____ __ 5,200 odd (or nearly 84 per cent) 872 (3) National Finance Ltd. (assessee Company) 50,000 shares. Ganesh Finance Corporation Ltd. 48,000 (or over 96 per cent) (4) National Construction and Develop ment Corporation Ltd. 1,30,504 shares. Ganesh Finance Corporation Ltd. 1,30,500 (almost all) (5) Ganesh Finance Corporation Ltd. 50,000 shares. Raghunath Investment Trust Ltd. 49,795 (99.6 per cent of the capital) (6) Raghunath Investment Trust Ltd. 10,000 shares. (i) Mr. Yodh Raj Bhalla 1,500 (ii) Mrs. Bhalla 1,000 (iii) Mr. N. C. Malhotra (brother in law) 1,000 (iv) Mr. Ram Prasad (father in law) 1,000 (v) Mr. Dina Nath (Secretary) 1,000 (vi) National Finance Ltd. 3,499 (vii) Mr. Piyare Lal Saha 1 9,000 (90 per cent). The resulting position may be stated thus: Ganesh Fiance Corporation Ltd. practically owns the assessee Company and National Construction and Development Corporation Ltd., Raghunath Investment Trust Ltd. practically owns the Ganesh Finance Corporation Ltd., and 'Yodh Raj Bhalla group ' practically owns Raghunath Investment Trust Ltd. 873 Jaswant Sugar Mills Ltd. is practically owned by Jaswant Straw Board Ltd., National Finance Ltd., and National Construction and Development Corporation Ltd., and Jaswant Straw Board Ltd., is practically owned by National Finance Ltd., and National Construction and Development Corporation Ltd. Thus, the entire group is owned by a consortium, and there is no doubt about it. The shares of Madhusudan Mills Ltd. were acquired in the following circumstances: In July 1948, Mr. Yodh Raj Bhalla, who was in a position by reason of his holdings in these six Companies to influence decisions of the Board of Directors, arranged to purchase 26,547 shares of the Mills from Messrs. Bhadani Brothers, Ltd., who were the managing agents of the Mills. This block of shares represented about 80 per cent of the total issued capital of the Mills, The purchase was made at Rs. 400 per share, when the price in the market, was about Rs. 250 per share. Out of the remaining shares which were on the market 200 shares were purchased at Rs. 252 8 0 per share, which was then the quoted price. Now, these shares were purchased by Jaswant Sugar Mills Ltd., but the money for the purchase of the shares was obtained by borrowing it from some of the other concerns. These Companies, as has been shown above, were completely under the control of 'Yodh Raj Bhalla group '. The arrangement for the money was as follows: Rs. 14,75,000 borrowed from the assesee Company. Rs. 5,00,000 from National Construction and Development Corporation Ltd. Rs. 55,00,000 from the assessee Company but advanced by Ganesh Finance Corporation Ltd. 874 The shares were registered as follows: 10,500 shares registered in the name of the assessee Company. 5,400 shares in the name of the National Construction and Development Corporation Ltd., and the balance in the names of the nominees of Jaswant Sugar Mills Ltd., which meant, largely, persons belonging to the 'Yodh Raj Bhalla group '. On October 9, 1949, the assessee Company purchased 15,547 shares at Rs. 400 per share from Jaswant Sugar Mills Ltd., and the amount paid by the assessee Company was adjusted towards the purchase price and the balance was paid. On the same day, the remaining 11,000 shares were sold by Jaswant Sugar Mills Ltd. to National Construction and Development Corporation Ltd., at Rs. 400 per share. Thus, on that date Jaswant Sugar Mills Ltd. ceased to have any connection with the present matter. It may be pointed out that on the date on which the two transactions took place, the priceruling in the market was about Rs. 217 8 0. Before Jaswant Sugar Mills Ltd. parted with the shares, they. had appointed a new Board of Directors of the Madhusudan Mills Ltd., and these new Directors also belonged to the same group. The managing agency of Messrs. Bhadani Brothers Ltd. was terminated, and on the same day on which the shares were purchased from these managing agents, the assessee Company was appointed as the purchasing and selling agent of the Mills. The assessee Company made enormous profit from the acquisition of these shares by way of dividend and commission as the purchasing and selling agent. In October and November, 1948 they, however, sold 6,525 shares to Dalmia Cement and Marketing Company Ltd. at Rs. 400 per share. These shares subsequently came back to the same group; but 875 that is not a matter with which we are immediately concerned. On April 7, 1949, 4,500 shares were sold by the assessee Company to the National Investment Trust Ltd. at Rs. 181 per share resulting in a loss of Rs. 8,80,000, and on June 1, 1949, another block of 3,000 shares was sold to the National Investment Trust Ltd., at Rs. 180 per share, resulting in a loss of Rs. 5,86,312. We are not concerned with the loss arising from the first sale which was considered in the assessment year, 1950 51, and in respect of which a reference is pending in the High Court of Punjab. We are concerned with the loss in the second year relating to the assessment year, 1951 52. In that year, the loss on the sale of the shares was sought to be set off against the profits made, and the loss practically cancelled the profits. The shares which were sold by the assessee Company on the two occasioning were sold to one Amrit Bhushan (a relative of Mr. Yodh Raj Bhalla) who sold then the same day to Messrs. National Investment Trust Ltd., at the slender profits of 8 annas per share, which was brokerage. Thus, at the beginning and at the end, though numerous transactions had taken place, the shares continued to be the property of the 'Yodh Raj Bhalla group '. The question is whether the loss on the sale of the shares be set off against the profits in the year in which the sales and profits were respectively made. The assessee Company was assessed for the assessment year, 1950 51, by the Income tax Officer, Meerut. In that year, the loss of Rs. 8,78,062 8 0 arising from the sale of Rs. 4,520 shares of Madhusudan Mills Ltd. was set off against the profits of the assessee Company. The case of the assessee Company for the assessment year, 1951 52, was considered by the Income tax Officer, Central Circle V, New Delhi, to whom the cases of the other Companies above named were also transferred. By looking into the 876 affairs of these Companies, he came to learn, that the shares of the Madhusudan Mills Ltd. were purchased at a price, which was almost double the current market price, by the 'Yodh Raj Bhalla group, and were transferred at the same price to the assessee Company. He found that this was done with a view to removing Messrs. Bhadani Brothers, Ltd. from their managing agency and to securing for the assessee Company the purchasing and selling agency of the Mills. On the date of the purchase from Messrs. Bhadani Brothers, Ltd., Jaswant Sugar Mills Ltd. achieved this purpose in view of their controlling interest. Bhadani Brothers, Ltd. ceased to be the managing agents from that date, and the purchasing and selling agency of the Madhusudan Mills, Ltd. was given to the assessee Company, though it had, on that day, done no more than give a loan to Jaswant Sugar Mills Ltd. In the assessment year, 1951 52, the loss of Rs. 5,86,312 8 0 on the sale of 3,000 shares was, therefore, disallowed holding it to be a capital loss. The order of the Income tax Officer, Central Circle V, New Delhi was confirmed on appeal by the Appellate Assistant Commissioner. On further appeal by the assessee Company, the Income tax Appellate Tribunal, Delhi, reversed the order of the Appellate Assistant Commissioner, and held that the loss was a trading loss. Whether a particular loss is a trading loss or a loss on the capital side undoubtedly depends upon the facts of each case. But it has been held, over and over again, that the question is not one of pure fact, and that a mixed question of fact and law is always involved. The cases to which we shall make a reference presently, have laid down this proposition, and those cases have also indicated how the matter is to be viewed in the context of facts. In Commissioner of Income tax vs Ramnarain Sons Ltd. (1), the Company was a dealer in shares 877 and also carried on the business of acquiring managing agencies of other Companies. The Company the acquired the managing agency of a Textile Mill from Messrs. Sassoon J. David and Co. Ltd., and also agreed as part of the same transaction to buy 2,507 shares of the Mills. 1,507 shares were purchased at Rs. 2,321 8 0 per share, and the remaining 4,000 shares were purchased at Rs. 1,500 per share. These shares were quoted on the market at Rs. 1,610. Later,4,000 shares were sold at a loss of Rs. 1,78,000 This was shown in the books of the Company as a busines loss but was disallowed, as the shares were not held to be the stock in trade of the business of the Company as share dealers. On a reference to the High Court of Bombay, a Divisional Bench upheld the view of the Tribunal. Chagla,C. J., in delivering the judgment of the Court, observed that a managing agency being an asset of an enduring nature, the way to look at the matter was to enquire what was, the primary intention in acquiring the shares. The learned Chief Justice then referred to a judgment of this Court reported in Kishan Prasad & Co. Ltd. vs Commissioner of Income tax (1), where it was observed: "It seems that the object of the assessee Company in buying shares was purely to obtain the managing agency of the third mill which no doubt would have been an asset of an enduring nature and would have brought them profits but there was from the inception no intention whatever on the part of the assessee Company to re sell the shares either at a profit or otherwise deal in them." The learned Chief Justice then considered the argument that a block of shares might have to be bought, if at all, at a higher price, and observed as follows: "A dealer in shares may succeed in getting a large number of shares at a price less than 878 the market price if the seller is in difficulties and wants to get rid of his shares and to get liquid assets. But we have not heard of a dealer in shares purchasing a large number of shares at a higher value than the market value. The other circumstance which is equally strong in this case is that the shares were purchased for the acquisition of the managing agency. Therefore the real object of the assessee company was not to do business in these shares, not to make profit out of these shares, but to acquire a capital asset out of which it would earn managing agency commission and make profit." Messrs. Ramnarain and Sons. Ltd. then appealed to this Court, and the decision of the Bombay High Court was upheld. The Judgment of this Court is reported in Ramnarain Sons (Pr.) Ltd. vs Commissioner of Income tax (1). It was laid down by this Court that in considering whether a transaction was or was not an adventure in the nature of trade, the problem must be approached in the light of the intention of the assessee, having regard to the "legal requirements which are associated with the concept of trade or business". Dealing with the price above the market price which was paid in that case, it was observed: "Even assuming that the appellants acquired the entire block of 2,507 shares from M/s. Sassoon J. David & Co. Ltd. the shares transferred to the names of the directors being held by them merely as nominees of the appellants the price per share was considerably in excess of the prevailing market rate. The only reason for entering into the transaction, which could not otherwise be regarded as a prudent business transaction, was the acquisition of the 879 managing agency. If the purpose of the acquisition of a large block of shares at a price which exceeded the current market price by a million rupees was the acquisition of the managing agency, the inference is inevitable that the intention in purchasing the shares was not to acquire them as part of the trade of the appellants in shares. " The above two decisions are merely the application of a principle of long standing, which has been stated over and over again in the past. In Oriental Investment Co. Ltd. vs Commissioner of Income tax (1), that principle was reiterated, and it was that the object for which a company was formed did not invest the deal with the characteristics of a trade in shares, but that other circumstances along with that fact must be considered to find out the real object of a particular venture. Before we deal with the present case, one other case of this Court may be noticed. In Rajputana Textiles vs Commissioner of Income tax (2), the converse conclusion was reached. There, on the facts and circumstances of the case, it was held that a particular deal in shares was a commercial venture and had all the attributes of an adventure in the nature of trade. In that case, the transaction was not a single or an undivided one with a slump payment, because for the managing agency, Rs. 12,50,000 were paid separately and for the shares, a sum of Rs. 83,98,000 was paid. The two acquisitions being different, the profit on the sale of some of the shares was considered to be a gain on the revenue side. There is no doubt, whatever, that the shares of the Madhusudan Mills Ltd. were acquired at a price considerably higher than the market price. In fact, that the price paid was almost double. Such a deal, from the business point of view, was not prudent, unless the purchaser stood to gain in some 880 other way. It was contended before us that this was a speculative deal in the hope that the price of the shares would firm up when the textile industries would revive. If this was the intention, then it might possibly be argued that the purchasers miscarried in their calculations, and suffered a loss in a business transaction. But, was this the intention of the Directors of Jaswant Sugar Mills Ltd. ? Those who sold the shares were not only in possession of the shares but also of the managing agency of the Madhusudan Mills Ltd., and the intention of the Directors of Jaswant Sugar Mills Ltd. was to remove the sellers from their position as managing agents and to get the entire benefit of such or other agencies for themselves. The assessee Company has urged that might have been the intention of they Jaswant Sugar Mills Ltd. but not of the assessee Company which had, on that day, merely given a loan to Jaswant Sugar Mills Ltd. Curiously enough, however, the immediate benefit of the deal was the acquisition of the selling and purchasing agency of the Mills, and that was obtained not in favour of Jaswant Sugar Mills Ltd. but of the assessee Company, even though on July 15, 1948 (the date of purchase) the assessee Company had obtained registration of 10,5000 shares by way of security in its own name. Why the assessee Company was favoured in this way is not far to seek. It mattered not whether Jaswant Sugar Mills Ltd. acquired that agency or the assessee Company; the benefit thereof went to the same group of persons. The transaction of sale of the shares was also made within three months of their purchase, and the assessee Company not only bought the 10,500 shares which stood in its name but 15,547 shares, which gave the assessee Company a controlling voice in the affairs of the Mills. The assessee Company continued to retain the selling and purchasing agency, which was very profitable. Indeed, on its investment in the first year of Rs. 14 lakhs odd, it 881 made a profit of about Rs. 7 lakhs. The question, therefore, would be whether the assessee company in purchasing the shares merely wished to deal in shares as stock in trade, or was acquiring a capital asset of an enduring nature. This question is not one of fact, pure and simple, hut one of an inference in law from the proved circumstances of the case. The Income tax Officer, in deciding this question against the assessee Company, pointed out numerous circumstances, which showed clearly that this was not a mere purchase of shares as shares by a speculator, who, buying a big block, sometimes pays slightly more than the market rate. Bhadani Brothers Ltd., owned not only the shares but also the managing agency, and it is obvious that they would not part with the shares without charging for the managing agency. The price of Rs. 400 per share was so out of proportion to the market price that it indicated, by itself, the acquisition of something more than the mere shares. According to the Income tax officer, the real intention was to acquire lucrative agencies of the Mills, and this intention, whether it was held by Jaswant Sugar Mills Ltd. Or the assessed Company or both, was of the same body of persons. The Appellate Assistant Commissioner endorsed the view of the Income tax officer; but the Tribunal made a distinction between one Company and another, and that distinction has been pressed upon us by the assessee Company. Relying upon the well known case of Salomon vs Salomon & Co. Ltd.(1), it was argued before us that each company must be viewed as a separate entity, and that the intention of one company could not be attributed to another company, even though the proprietorship of the companies might be same. As a proposition affecting companies, it cannot be gainsaid; but we are not concerned with a theoretical question as to the assesee Company being a separate legal entity, but with the 882 question whether a particular loss made by the assessee Company is a capital or a revenue loss. The two Companies, i. e., jaswant Sugar Mills Ltd. and the assessee Company, were directed by the same set of persons, and the facts show that even though Jaswant Sugar Mills Ltd. temporarily acquire the shares, they conferred all the benefits of the acquisition upon the assessee Company from the very first day. The assessee Company also ultimately came into possession of all the shares along with another Company, which was also directed by the same persons, and Jaswant Sugar Mills Ltd. went out of the picture within three months. In these circumstances, it is easy to see that the interposition of Jaswant Sugar Mills Ltd. was merely a device to secure the benefit of the English case, to which we have referred. It was never intended that Jaswant Sugar Mills Ltd. would hold the shares or the benefits arising from the acquisition of a block of shares, giving to the holder a decisive voice in the affairs of Madhusudan Mills Ltd. That controlling interest was acquired by the `Yodh Raj Bhalla group ' for the benefit of the assessee Company, and it was an acquisition of an interest of an enduring nature. Reference was made, in this connection, to the transactions with the Dalmia Cement and Marketing Co. Ltd. in which the latter paid the same price namely, Rs. 400 per share. Perhaps, the Dalmia Company was after the controlling interest in its own way, and it is significant to note that within a short time, those shares again found their way in the hands of the same group. Similarly, the shares changed hands even within this group through the agency of Amrit Bhushan, no doubt a broker but also a relative of Mr. Yodh Raj Bhalla, who profited only to the extent of 8 annas per share, and bought and sold the shares from one Company to mother on the same day. All this show that the affairs of there Companies were centrally arranged, and the 883 intention was to benefit the assessee Company by the acquisition of a large block of shares at a very much later prices than obtaining in the market, to acquire certain agencies of a profitable character. In our opinion, this transaction must be regarded as one on the capital side. Shares were never treated as part of the stock in trade. They were not sold in the market, but were sold at a loss to another Company belonging to the same group, with the obvious intention of setting off the losses against the profits, thus cancelling the profits, and saving them from taxation. In the result, the appeal is allowed, with costs on the respondent. Appeal allowed.

The respondent was a company dealing in shares and securities and belonged to a group of companies all controlled by the same persons. In the year of account, corresponding to the assessment year 1951 52, the respondent sold the shares relating to Madhusudan Mills Ltd., which it had acquired sometime earlier, suffering a loss for which it claimed a set off against the profits in that year. The Income tax Officer found that the shares in question had been purchased by J, a company belonging to the group, at a price which was almost double the current market price, that it was so done with a view to removing the sellers from their managing agency and to securing for the respondent the purchasing and selling agency of the Mills, and that after the purchase J achieved the purpose in view of its controlling interest and the purchasing and selling agency of the Mills was given to the respondent, though the latter had done no more than give a loan to J. It was also found that soon after the purchase the shares in question came into the possession of the respondent and that when the shares were sold it was not in the market but at a loss to another company belonging to the same group. The Income tax Officer came to the conclusion that in getting the shares the respondent did not deal with them as stock in trade but was acquiring a capital asset of an enduring nature. Accordingly, he disallowed the claim holding the loss to be a a capital loss. The Appellate Tribunal, however, held in favour of the respondent on the view that a distinction must be made between the respondent company and J. The Commissioner of Income tax moved the Tribunal for a reference to the High Court, but it was dismissed on the ground that though it was barred only by one day and there was no negligence on the part of the Commissioner, the Tribunal had no power to extend time. An application to the High Court was also dismissed. The Commissioner of Income tax then applied for and got special leave to appeal against 866 the order passed by the Tribunal. When the appeal came on for hearing in due course the respondent raised an objection that the appeal was not maintainable because no appeal was filed against the order of the High Court, and relied on the decision in Chandi Prasad Chokani vs State of Bihar, ; ^ Held, that the appeal was maintainable because there was no question of by passing the order of the High Court which only related to the correctness of the decision of the Tribunal on the question of limitation which was not the subject of the present appeal. Held, further, that there were special circumstances which justified the grant of special leave. Baldev Singh vs Commissioner of Income tax , applied. Chandi Prasad Chokhani vs State of Bihar ; , distinghuished. Held, also, that, on the facts, the object was to purchase a large block of shares at a much larger price than the market value to acquire certain agencies of a profitable character, that the purchase of the shares by J was merely a device but the controlling interest was acquired by the respondent, and that the transaction must be regarded as one on the capital side. Ramanarain Sons (P.) Ltd. vs Commissioner of Income tax, ; and Oriental Investment Co. Ltd. vs Commissioner of Income tax, ; , applied. Salomon vs Salomon & Co. Ltd. ; , distinguished.

ION: Criminal Appeal No. 223 of 1959. Appeal by special leave from the judgment and ordered dated April 14, 1959, of the former Bombay High Court (Rajkot Branch) at Rajkot in Criminal Appeal No. 84 of 1958. Nur ud din Ahmed and K. L. Hathi for appellant. H. R. Khanna and R. H. Dhebar, for respondent. January 24. The Judgment of the Court was delivered by KAPUR, J. The appellant and two others were convicted by the Additional Sessions Judge, Gohilwad, under sections 302 and 201 of the Indian Penal Code for the murder of Kanji and they were sentenced to imprisonment for life under the former section and to seven years ' rigorous imprisonment under the latter. The sentence were concurrent. On appeal the High Court set aside the conviction 728 of Nanji Ravji but upheld the convictions and sentences of the appellant and Karamshi Bhawan. The appellant has Come in appeal to this Court by Special leave. The deceased Kanji was rather an unsavoury character in village Chiroda and it is alleged that he had a illicit connection with Shrimati Shantu the sister of Karamshi and also used to follow about Smt. Baghu the sister of the appellant for a similar object. It is stated that five days before the occurrence the appellant Karsan, Karamshi, Nanji and Gumansinh approver met and decided to murder the appellant. With that object in view Gumansinh approver was to decoy the deceased to the Vadi of the appellant and there the murder was to be committed. At about sunset on March 19, 1958, the deceased was decoyed to the place as previously arranged and there he was murdered by the appellant who gave him a few blows. with a sharp cutting instrument called Dharia. According to the statement of the approver the dead body was wrapped in the scarf of the deceased and was carried by the appellant from the place of the murder to the dry bed of the river and there it was burried in a pit. Nothing was heard of the murder or of the deceased till on March 26, 1958, a brother of the deceased made a report to the police about his disappearance and that he suspected the three uncles of the appellant, subsequently the appellant and the other accused persons were taken into custody by the police. One of them while in the custody of the police, was allowed to go to the village and he asked the help of Shamji and Manilal P.Ws. He also made a confession to them and they reported the matter to the police. On March 31, 1958, Gumansinh and Karamshi made confessions 729 which were recorded by a Magistrate. Between March 26 and March 31, recoveries of various articles were made. At the instance of the appellant, it is stated, the dead body and then the head of the deceased was recovered from a distant well. At the instance of Nanji on March 28, 1958 a scarf was, discovered in the pit in which the dead body was according to the approver, buried. On the scarf, there were some hairs which on analysis by the Chemical Examiner were found to be similar to the hairs of the appellant and of the deceased. A day previous, i. e. March 27, 1958, at the instance of the appellant silver buttons which were stained with human blood were discovered from the field of the appellant at small stick like a button belonging to the deceased was also found at his instance. The High Court rejected the confession of Karamshi on the ground that it was not voluntary. It acquitted Nanji on the ground that there were no corroboration in regard to him of the approver 's statement, the place where the dead body was buried was not discovered at his instance, his production of stick and shirt and trousers from his house was of no consequence, and the oral evidence was contrary to the medical evidence and Karamshi 's confessional statement could not be used against Nanji. In regard to the appellant the High Court accepted the testimony of the approver as being a reliable piece of evidence. It attached no importance to the recovery of the cutting instrument, Dharia, nor to the discovery of the stick (Dhoka) at his instance. But the High Court did rely upon the discovery of the dead body of the deceased, i.e. the trunk and the head, at the instance of the appellant and of the blood stained buttons also at his instance and attached importance to scarf recovered from the pit where the dead body was alleged to have been first buried and which had hairs both of the appellant as well as of the deceased. 730 It was argued for the appellant that the evidence of the approver, even though it had been accepted as true, was not corroborated in material particulars connecting the appellant with the offence. On the other hand it was contradicted. The approver had stated that the dead body was buried in a pit in the dry bed of the river but when that pit was dug up the dead body was not found there and only a piece of ulna bone and a heel of a human foot were found and all there recoveries had been made earlier and so could not be called corroborative in material particulars. It was further submitted that there was no evidence to show as to when and how the body of the deceased was removed from the pit, dismembered and thrown into the well. The recovery of the scarf, it was pointed out, was an innocuous circumstance because on the evidence produced it had not been shown to belong to the appellant but to his father and the evidence of the Chemical Examiner was not sufficient to prove that the hairs on the scarf were of the appellant or of the deceased because the Chemical Examiner was certainly no expert on this matter and his evidence was, not admissible under section 45 of the Evidence Act, and at the most, according to the Chemical Examiner 's report the hairs resembled those of the appellant. And secondly according to the approver the dead body of the deceased was wrapped in his own pania (scarf). It was further submitted that the statement in regard to the recovery of the trunk and the head will only show that the appellant knew where the trunk and the head were, which at the most would lead to an inference of an offence under 8. 201 and not of 8. 302. What the law requires in the case of an accomplice 's evidence is that there should be such corroboration of the material Parts of the story connecting the accused with the crime as will satisfy reasonable minds that the approver can be regarded 731 as a truthful witness. The corroboration need not be direct evidence of the commission of the offence by the accused. If it is merely circumstantial evidence of his connection with the crime it will be sufficient and the nature of the corroboration will depend on and vary with the circumstances of each case. Vemireddy Satyanarayan Reddy vs The State of Hyderabad. The confessional statement made by the approver on March 31, 1958 gave the following facts connecting the appellant with the murder. (1) The appellant gave dharia blow to the deceased. The dharia had already been discovered and it has been disregarded from the evidence by the High Court as being of no importance. The next thing stated by the approver was that the deceased 's body was tied in a pania (scarf). He did not state that the scarf in which it was bound belonged to the appellant. The next fact stated by him was that the appellant carried the body of the deceased and then it was buried in a pit and lastly he stated that the appellant had told him that the head of the deceased had been thrown into a well. None of these recoveries in the circumstances of this case are corroborative of the statement of the approver to the extent of connecting the appellant with the offence committed. On the other hand, they are somewhat contradictory of the statement because the pania (scarf) which was found in the pit has now been stated to belong to the appellant. The dead body was not found in the pit, the head had already been discovered and the trunk had also been taken out of the well. In these circumstances it was submitted that the approver 's statement cannot be said to have been corroborated in material particulars. But there are other circumstances which have to be considered even if the evidence of the approver is held not to be very helpful to the prosecution. Firstly, there is the pointing out of 732 the dead body by the appellant from the well; secondly, the discovery of the blood stained (stained with human blood) buttons at the instance of the appellant i thirdly the scarf which has been held to belong to the appellant and which was found from the pit pointed out by the co accused Nanji and fourthly by the presence of the hairs of the appellant and of the deceased on that scarf. The mere fact that the dead body was pointed out by the appellant or was discovered as a result of a statement made by him would not necessarily lead to the conclusion of the offence of murder. But there are other circumstances which have to be considered. The discovery of the buttons with bloodstains at the instance of the appellant is a circumstance which may raise the presumption of the participation of the appellant in the murder, In Wasin Khan vs The State of Uttar Pradesh (1), it was held that the recent and unexplained possession of stolen property would be presumptive evidence against a prisoner on a charge of robbery as also of a charge of murder. But it must depend upon the circumstance of each case. The third piece of evidence to be considered is the recovery of the pania i.e. scarf. No doubt there is no statement by the approver that the scarf in which the dead body was taken was that of the appellant. But a scarf has been found which the High Court has held as belonging to the appellant and hairs were found on that scarf. It was argued that the finding of the hairs was of no consequence and at least the Chemical Examiner was not he proper expert who could depose as to the similarity or other wise of the hairs. The writers on medical jurisprudence, however, have stated that from the microscopic examination of the hairs it is possible to say whether they are of the same or of different colours or sizes and from the examination it may help in deciding where the hairs come from. In 733 Taylor 's Medical Jurisprudence (1956 Edn.) Vol. 1, at page 122, sine cases are given showing that hairs were identified as belonging to particular persons. Thus, we have besides the evidence of the approver three important facts which connect the appellant with the commission of the offence. His pointing out the dead body, his pointing out the silver buttons of the deceased which were stained with human blood and the presence of his hairs on a pania (scarf) on which there were the hairs of the deceases also. In our opinion this would be sufficient evidence in the circumstances of the present case to connect the appellant with the commission of the offence. We, therefore, dismiss the appeal. Appeal dismissed.

The appellant and two others were convicted for murder under sections 302 and 201 of the Indian Penal Code. The High Court accepted the testimony of the approver as being a reliable piece of evidence. It relied upon the discovery of the dead body of the deceased at the instance of the appellant and of blood stained buttons also at his instance and attached importance to the scarf recovered from the pit where the dead body was alleged to have been first buried and which had hairs both of the appellant as well as the deceased. The appellant contended that the evidence of the approver, even though it had been accepted as true, was not corroborated in material particulars connecting the appellant with the offence. None of the recoveries are corroborative of the statement of the approver to the extent of connecting the appellant with the offence committed; on the other hand they are somewhat contradictory of the statement. The evidence of the Chemical Examiner was not sufficient to prove that hairs on the scraf were of the appellant or of the deceased because the Chemical Examiner was no expert on this matter and his evidence was not admissible under section 45 of the Evidence Act and, at the most, according to the Chemical Examiner the hairs resembled those of the appellant. ^ Held, that where the evidence of the approver is held not to be very helpful to the prosecution other circumstances 727 besides the evidence of the approver has to be considered. The mere fact that the dead body was pointed out by the appellant or was discovered as a result of a statement made by him would not necessarily lead to the conclusion of the offence of murder. In the present case beside the evidence of the approver, the appellant 's pointing out of the dead body, his pointing out the silver buttons of the deceased which were stained with human blood and the presence of his hairs on a pania (scraf) on which there were the hairs of the deceased also, are important facts which are sufficient evidence to connect the appellant with the commission of the offence. Held, further, that writers of medical jurisprudence have stated that from microscopic examination of the hairs it is possible to say whether they are of the same or of different colours or sizes and from the examination it may help in deciding where the hairs come from. Vemireddy Satyanarayan Reddy vs State of Hyderabad, ; and Wasim Khan vs State of Uttar Pradesh, [1956] S.C.R. 191, relied on.

ION: Criminal Appeal No. 126 of 1960. Appeal by special leave from the Judgment and order dated November 23, 1959, of the Punjab High Court in Criminal Revision No. 1445 of 1959. V. D, Mahajan, for the appellant. B. K. Khanna, D. Gupta and P. D. Menon, for the respondent. January 25. The Judgment of the Court was delivered by HIDAYATULLAH, J. This is an appeal by one Dault Ram who was prosecuted under section 182 of the Indian Penal Code and sentenced to imprisonment for three months. His revision application in the High Court of Punjab at Chandigarh was dismissed in limini; but he obtained special leave from this court and has filed this appeal. The appellant was working as a Patwari and on August 19, 1958, he wrote a letter to the Tehsildar of Pathankot that on the previous day he had been set upon by two persons Hans Raj and Kans Raj who beat him severely and robbed him of certain of his official papers and some money, which was with him, partly belonging to 814 him and partly to the Government. At the end of the letter which he wrote to the Tehsildar, he stated that the letter was written for his information. The Tehsildar, however, forwarded the letter to the Sub Divisional Officer who in his turn sent it on to the police. The police enquired into the facts and reported that the allegations in letter were false. Meanwhile, it appears that the appellant entered into some sort of compromise with Hans Raj and Kans Raj and wrote another letter saying that as they were his relatives and he had found the papers and money, the proceedings if any be dropped and the papers be consigned to the record room. The matter however was pursued further and when the report of the police came that the allegations in the original letter were false, the Tehsildar asked the police that a "calendar" be drawn up. The police however launched a prosecution against the appellant under section 182 of the Indian Penal Code, and after due trial, the appellant was found guilty of that offence and was sentenced to three months ' rigorous imprisonment. His appeal and revision failed and we have been informed that the appellant has served out his entire sentence. The only question in this case is whether a complaint in writing as required by section 195 had been presented by the public servant concerned. The public servant who was moved by the appellant was undoubtedly the Tehsildar. Whether the appellant wanted the Tehsildar to take action or not, the fact remains that he moved the Tehsildar on what is stated to be a false averment of facts. He had charged Hans Raj and Kans Raj with offences under the Penal Code and he had moved his superior officer for action even though he might have stated in the letter that it was only for his information. We are prepared to assume that he expected that 815 some action would be taken. In fact his second letter that he had compromised the matter and the proceedings might be dropped clearly shows that he anticipated some action on the part of his superior officer. The question is therefore whether under the provisions of section 195, it was not incumbent on the Tehsildar to present a complaint in writing against the appellant and not leave the court to be moved by the police by putting in a charge sheet. The words of section 195 of the Criminal Procedure Code are explicit. The section reads as follows: "(1) No Court shall take cognizance (a) of any offence punishable under sections 172 to 188 of the Indian Penal Code, except on the complaint in writing of the public servant concerned, or of some other public servant to whom he is subordinate; The words of the section, namely, that the complaint has to be in writing by the public servant concerned and that no court shall take cognizance except on such a complaint clearly show that in every instance the court must be moved by the appropriate public servant. We have to decide therefore whether the Tehsildar can be said to be the public servant concerned and if he had not filed the complaint in writing, whether the police officers in filing the charge sheet had satisfied the requirements of section 195. The words "no court shall take cognizance" have been interpreted on more than one occasion and they show that there is an absolute bar against the court taking seisin of the case except in the manner provided by the section. Now the offence under section 182 of the Penal Code, if any, was undoubtedly complete when the appellant had moved the Tehsildar for action. Section 182 does not require that action must always be 816 taken if the person who moves the public servant knows or believes that action would be taken. In making his report to the Tehsildar therefore, if the appellant believed that some action would be taken (and he had no reason to doubt that it would not) the offence under that section was complete. It was therefore incumbent, if the prosecution was to be launched, that the complaint in writing should be made by the Tehsildar as the public servant concerned in this case. On the other hand what we find is that a complaint by the Tehsildar was not filed at all, but a charge sheet was put in by the Station House Officer. The learned counsel for the State Government tries to support the action by submitting that section 195 had been complied with inasmuch as when the allegations had been disproved, the letter of the Superintendent of Police was forwarded to the Tehsildar and he asked for "a calendar". This paper was flied along with the charge sheet and it is stated that this satisfies the requirements of section 195. In our opinion, this is not a due compliance with the provisions of that section. What the section comtemplates is that the complaint must be in writing by the public servant concerned and there is no such compliance in the present case. The cognizance of the case was therefore wrongly assumed by the court without the complaint in writing of the public servant namely the Tehsildar in this case. The trial was thus without jurisdiction ab inito and the conviction cannot be maintained. The appeal is therefore allowed and the conviction of the appellant and the sentence passed on him are set aside. Appeal allowed.

The appellant a Patwari wrote a letter to the Tehsildar under whom he was working that he had been robbed of certain official papers and money. The police reported that on investigation, the allegations were found to be false. The Tehsildar asked the police that a "calendar" be drawn up. The police launched a prosecution under section 182 of the Indian Penal Code. No complaint in writing as required by section 195 of the Code of Criminal Procedure was made by the Tehsildar 813 as the public servant concerned in the case, but a charge sheet was put in by the police attaching the letter of the Tehsildar asking them to draw up a "calendar" against the appellant. ^ Held, that in a prosecution to be launched under section 195 of the Code of Criminal Procedure, it is incumbent that a complaint in writing should be made by the public servant concerned for only on such complaint can the court take cognizance of the offence otherwise the trial is without jurisdiction ab initio. Held, further, that section 182 does not require that an action must always be taken on the report made to the public servant, the offence is complete as soon as the report is made and the person who made the report believed that some action would be taken.

N: Cr. A. No. 189 of 1961. Appeal by special leave from the judgment and order dated July 10 and 11, 1961, of the Bombay High Court (Nagpur Bench) in Criminal Application No. 19 of 1961. A. section Bobde, B. A. Masodkar, M. L. Vaidya, M. M. Kinkhede and Ganpat Rai, for the appellant. M. C. Setalvad, Attorney General for India, B. Sen and R. H. Dhebar, for the respondents. January 31. The Judgment of the Court was delivered by 919 SINHA, C J. This appeal is directed against the Judgment and order dated July 11, 1961 of a Division Bench of the Bombay High Court (Nagpur Bench), dismissing the appellant 's application, under article 226 of the Constitution, read with section 491 of the Code of Criminal Procedure, wherein he had prayed for a writ of Habeas Corpus against the State of Maharashtra and the District Magistrate of Nagpur, directing them to produce the petition in Court and to set him at liberty. This application was heard by us on January 8 and 9, 1962, and after hearing Shri A. section Bobde for the appellant and the learned Attorney General for the State of Maharashtra, we directed that the appellant be released forthwith, and that the reasons for our judgment will follow later. We now proceed to set out our reasons for the order passed on that day. It appears that an Order of Detention, under section 3(1) (a)(ii) of the Preventive Detention Act (IV of 1950) hereinafter referred to as the Act) was made by the District Magistrate of Nagpur on April 10, 1961. The order of Detention is in these terms: "No. CC/X (2) of 1961 office of the District Magistrate, Nagpur, Dt. 10th April, 1961. ORDER OF DETENTION UNDER SEC. 3(1)(a) (ii) OF THE . Whereas I am satisfied that it is necessary to prevent Shri Harikisan Kishorilal Agarwal of Nagpur from acting in a manner prejudicial to the maintenance of public order and that therefore, it is necessary to detain him. Now, therefore, in exercise of the powers conferred on me by Section 3(1)(a)(ii) of the 920 , I Dinkarrao Hanjantrao Deshmukh, I.A.S., District Magistrate, Nagpur hereby direct that the said Shri Harikisan Kishorilal Agarwal be so detained. Given this 10th day of April 1961 under my signature and seal. Seal of the Sd/D.H. Deshmukh D.M. Nagpur District Magistrate, Nagpur" He also directed that the appellant should be detained in the District Prison, Thana, and that for the purpose of the Bombay Condition of Detention order, 1951, be treated as a Class II Prisoner. The grounds of detention were served on the same day. The substance of the grounds is that since his release from previous detention in October, 1960, he had been instigating persons at Nagpur to defy and disobey reasonable directions and lawful orders issued by competent authorities, from time to time, prohibiting and regulating processions and assemblies at Nagpur; that by use of highly provocative words, expressions and slogans in meetings and processions in Nagpur, in which he took a prominent part, he had instigated persons on several occasions at Nagpur to indulge in acts of violence and mischief and to create disturbance in the city of Nagpur; and that he had been acting since October 1960, in a manner prejudicial to the maintenance of public order, in that city. And then follow 'notable particular ' of his activities, running into five closely typed pages and contained in many paragraphs. In his petition to the High Court, the petitioner raised a number of grounds of attack against the legality of the order of his detention, and most of those grounds have been reiterated in this Court. We do not think it necessary to go into all the points raised, on behalf of the appellant, by the learned counsel. In our opinion, it is enough to say that we are satisfied 921 that, in the circumstances of this case, the provisions of article 22(5) of the Constitution have not been fully complied with, and that, therefore, the appellant had not the full opportunity provided or contemplated by that Article of making his representation against the Order of Detention. In this connection, it is necessary to state the following facts. The appellant wrote a letter to the District Magistrate of Nagpur on April 19, 1961, to the effect that he had been served with an Order of Detention dated April 10, 1961, and that the Order and the grounds of detention being in English, he was unable to understand them, and therefore, asked for a Hindi version of the same so that he may be able to follow and understand the charges levelled against him and take necessary steps for his release from jail. He raised some other questions also in that letter, but it is not necessary to refer to them here. To that letter the District Magistrate replied by his letter dated April 23, 1961, the second paragraph of which, in the following terms, sets out his views of the matter: "The order of detention and the grounds of detention already communicated to you are given in English which is the official language in this district. It is not possible to supply any translation of the same for is (sic) it legally necessary under the . The order and the grounds of detention served on you were fully explained to you by the Police Officer in the presence of the D.S.P. Nagpur City." The High Court, dealing with this contention on behalf of the detenue, came to the conclusion that under the Constitution English still continued to be the official language of the State of Maharashtra, and that service of the Order in English upon the detenue was sufficient compliance with 922 the requirements of cl. (5) of article 22 of the Constitution. It also held that the failure of the District Magistrate to supply the grounds in Hindi did not have the effect of preventing him from making his representation to the authorities. Furthermore, the High Court pointed out that the District Magistrate had stated in his letter that the grounds were explained to the appellant in Hindi by the Police Officer at the time the Order and the grounds were served upon him. In the view of the High Court, therefore, the explanation or translation of the grounds by the Police Officer at the time he served those on the appellant should be deemed to be enough to enable him to make an effective representation against his detention. Mr. Bobde, for the appellant, has vehemently argued that the requirements of the Constitution had not been complied with inasmuch as cl. (5) of article 22 of the Constitution required that the grounds on which the Order of Detention had been based had to be communicated to the detained person. His argument further was that "communication" of the grounds was not equivalent to serving the grounds in English upon a person who was not conversant with the English language, and that oral translation by the police officer, said to have been made to the detenue, was not sufficient compliance with the requirements of the constitutional provisions, which must be fully satisfied in order that the detenue may be in a position to make an effective representation against the Order of Detention. He also contended that we do not know in what terms the police officer translated the lengthy document or whether his translation was correct. On behalf of the State of Maharashtra, the learned Attorney General first attempted to show that the appellant knew English. In this connection he has referred to the affidavit of the District Magistrate, the exact words of which are as follows: 923 "He (the detenue) had also asked me to supply the grounds in Hindi to enable him to understand the same. I admit that I had replied to this letter and had declined to communicate the grounds in Hindi. I deny that this has been done with a view to keep the petitioner in dark as to the grounds of his detention. The petitioner as per my information, is an educated man and can understand English. The question that the petitioner did not understand the grounds, therefore, does not arise. I deny that the petitioner is entitled to receive the grounds in Hindi. The grounds were supplied to the petitioner in the court language and also they were explained to him by the Police Inspector Shri W.B. Bobde who had served them on the petitioner. . " That statement of the District Magistrate is apparently based on the following statement, in the affidavit of Shri W.B. Bobde, the Police Inspector: "The Order of Detention as well as the grounds of detention were translated by me orally in Hindi and explained to Shri Harikisan Kishorilal Agrawal, in the presence of the District Superintendent of Police, Nagpur City. " It has not been found by the High Court that the appellant knew enough English to understand the grounds of his detention. The High Court has only stated that "he has studied upto 7th Hindi Standard, which is equivalent to 3rd English Standard". The High Court negatived the contention raised on behalf of the appellant not on the ground that the appellant knew enough English, to understand the case against him, but on the ground, as already indicated, that the service upon him of the Order and grounds of detention in English was enough communication to him to enable him to 924 make his representation. We must, therefore, proceed on the assumption that the appellant did not know enough English to understand the grounds, contained in many paragraphs, as indicated above, in order to be able effectively to make his representation against the Order of Detention. The learned Attorney General has tried to answer this contention in several ways. He has first contended that when the Constitution speaks of communicating the grounds of detention to the detenue, it means communication in the official language, which continues to be English; secondly the communication need not be in writing and the translation and explanation in Hindi offered by the Inspector of Police, while serving the Order of Detention and the grounds, would be enough compliance with the requirements, of the law and the Constitution; and thirdly, that it was not necessary in the circumstances of the case to supply the grounds in Hindi, in our opinion, this was not sufficient compliance in this case with the requirements of the Constitution, as laid down in cl. (5) of article 22. To a person, who is not conversant with the English language, service of the Order and the grounds of detention in English, with their oral translation or explanation by the police officer serving them does not fulfil the requirements of the law. As has been explained by this Court in the case of The State of Bombay vs Atma Ram Sridhar Vidya, (1) cl. (5) of article 22 requires that the grounds of his detention should be made available to the detenue as soon as may be, and that the earliest opportunity of making a representation against the Order should also be afforded to him. In order that the detenue should have that opportunity, it is not sufficient that he has been physically delivered the means of knowledge with which to make his representation. In order that the detenue should be in a position effectively to make his representation against the Order, he should have knowledge of the grounds of 925 detention, which are in the nature of the charge against him setting out the kinds of prejudicial acts which the authorities attribute to him. Communication, in this context, must, therefore, mean imparting to the detenue sufficient knowledge of all the grounds on which the Order of Detention is based. In this case the grounds are several, and are based on numerous speeches said to have been made by the appellant himself on different occasions and different dates. Naturally, therefore, any oral translation or explanation given by the police officer serving those on the detenue would not amount to communication, in this context, must mean bringing home to the detenue effective knowledge of the facts and circumstances on which the Order of Detention is based. We do not agree with the High Court in its conclusion that in every case communication of the grounds of detention in English, so long as it continues to be the official language of the State, is enough compliance with the requirements of the Constitution. If the detained person is conversant with the English language, he will naturally be in a position to understand the gravamen of the charge against him and the facts and circumstances on which the order of detention is based. But to a person who is not so conversant with the English language, in order to satisfy the requirements of the Constitution, the detenue must be given the grounds in a language which he can understand. and in a script which he can read, if he is a literate person. The Constitution has guaranteed freedom of movement throughout the territory of India and has laid down detailed rules as to arrest and detention. It has also, by way of limitations upon the freedom of personal liberty, recognised the right of the State to legislate for preventive detention, subject to certain safeguards in favour of the detained 926 person, as laid down in cls. (4) & (5) of article 22. One of those safeguards is that the detained person has the right to be communicated the grounds on which the order of detention has been made against him, in order that he may be able to make his representation against the order of dentention. In our opinion, in the circumstances of this case, it has not been shown that the appellant had the opportunity, which the law contemplates in his favour, making an effective representation against his detention. On this ground alone we declare his detention illegal, and set aside the Order of the High Court and the Order of Detention passed against him. Appeal allowed.

The detenue was served with the order of detention and the grounds in English. He did not know English and asked for a translation of these in Hindi. This request was refused on the grounds that the order and the grounds had been orally translated to him at the time they were served upon him and that English still being the official language communication of the order and grounds in English was in accordance with the law and the Constitution. ^ Held, that the provisions of article 22(5) of the Constitution were not complied with and the detention was illegal. Article 22(5) required that the grounds should be communicated to the detenue as soon as may be and that he should be afforded the earliest opportunity of making a representation against the order. Communication in this context meant bringing home to the detenue effective knowledge of the facts and grounds on which the order was based. To a person who was not conversant with the English language, in order to satisfy the requirement of the Constitution, the detenue must be given the grounds in a language which he can understand and in a script which he can read, if he is a literate person. Mere oral translation at the time of service was not enough.

Civil Appeal No. 323 of 196. Appeal from the judgment and order dated September 25, 1958, of the Bombay High Court in I.T.R. No. 3 of 1958. K. N. Rajagopal Sastri and D. Gupta, for the appellant. R. J. Kolah, J. B. Dadachanji, O. C. Mathur and Ravinder Narain, for the respondent. January 31. The Judgment of the Court was delivered by 904 section K. DAS, J. The Commissioner of Income tax, Bombay City I, has preferred this appeal to this Court on a certificate of fitness granted by the High Court of Bombay under section 66A (2) of the Indian Income tax Act, 1922. The assessee, who is the respondent before us, was assessed to income tax as an individual in respect of his income for the assessment year 1954 55. The taxing authorities included in the assessee 's total income for the year to sums, namely, a sum of Rs. 410/ and a sum of Rs. 14,170/ . It was stated that these two sums accrued in the relevant account year in the following circumstances. On January 12, 1953 the assessee created a trust in respect of a sum of Rs, 25,000/ , the trustees whereof were the Central Bank Executor & Trustee Co., the assessee himself his wife and brother. The scheme of the trust deed was that the said sum of Rs. 25,000/ was set apart by the assessee and it was provided that the interest on that amount should be accumulated and added to the corpus and a minor daughter of the assessee, named Chandrika, was to receive the income from the corpus increased by the addition of interest, when she attained the age of 18 on February 1, 1959. She was to receive the income during her life time and after her death the corpus was to go to persons with whom we are not concerned. The income derived from the said trust fund amounted to Rs. 410/ in the relevant account year and the taxing authorities included this amount in the total income of the assessee, purporting to act under section 16(3)(b) and/or section 16(3)(a)(iv) of the Income tax Act. As regards the second sum of Rs. 14,170/ it appears that on December 1, 1941, the assessee 's father had created a trust in respect of some shares and a cash sum of Rs. 30,000/ for the benefit of his four sons including the assessee. The trustees were the Central Bank Executor and Trustee Co. Ltd., the assessee himself and one other person. The said trustees were to hold the trust funds upon trust to 905 pay the net interest and income thereof to the assessee "for the maintenance of himself and his wife and for the maintenance, education and benefit of all his children till his death". The sum of Rs. 14,170/ . it was stated, accrued as income in the hands of the assessee in the relevant account year from the said trust funds. The view of the taxing authorities and the Income tax Appellate Tribunal was that under the aforesaid provision of the trust deed the assessee was the sole beneficiary and that the amount was received by him for his own benefit and he was not accountable to any one in respect of the amount and, therefore, this amount was liable to be included in his total income. On behalf of the assessee the contention was that the sum of Rs. 410/ aforesaid was not liable to be included in the total income of the assessee inasmuch as Chandrika, the minor daughter of the assessee, had no right to the income nor any beneficial interest therein in the relevant year of account under the provisions of the trust deed and, therefore, neither section 16(2)(a)(iv) nor section 16(3)(b) applied to the case. As to the sum of Rs. 14,170/ the case of the assessee was that it should not be included in his total income as the sole beneficiary, because the beneficiaries under the trust settlement were not only the assessee but his wife and children as well. It was contended that the assessee received the amount in trust for himself and his wife and children and it was open to the Department to proceed under the first proviso to section 41 (1) of the Income tax Act and recover tax on a separate assessment made on the assessee as a trustee in respect of the said sum at the maximum rate, because the individual shares of the beneficiaries on whose behalf the money was receivable were indeterminate and not known. The Income tax Appellate Tribunal, on an appeal by the assessee, did not accept these contentions. The Tribunal was then moved to state a 906 case to the High Court on two questions of law those questions were: "1. Whether the sum of Rs. 410/ is properly includible in the assessee 's total income either in accordance with the provisions of section 16(3)(b) and/or section 16(3)(a)(iv) of the Indian Income tax Act, 1922? 2. Whether the sum of Rs. 14,170/ is properly includible in the total income of the assessee as the sole beneficiary thereof under the trust settlement made on 1 12 1941 by Dhanji Devsi?" On being satisfied that these questions of law arose out of the order of the Tribunal dated April 24, 1957, the Tribunal stated a case under section 66(1) of the Income tax Act. The High Court answered both the questions in favour of the assessee by its judgment and order dated September 25, 1958. There after the High Court granted a certificate of fitness under section 66A(2) of the Income tax Act and, as we have already stated, the present appeal has been brought to this Court on the strength of that certificate. We proceed now to deal with the first question which relates to the sum of Rs. 410/ . The question is whether this sum was properly includible in the assessee 's total income under the provisions of section 16(3)(b) of the Income tax Act, because Mr. Rajagopal Sastri appearing for the appellant has not pressed the claim which was made before the Tribunal on behalf of the Department under the provisions of section 16(3)(a)(iv). Before we go to the provisions of section 16(3)(b) it is advisable to set out the material portions of cls. 3 and 4 of the trust deed of January 12, 1953. Those clauses were in these terms: "3. The Trustees shall hold and stand possessed of the trust fund and the investments for the time being representing the 907 same and receive the income, divided, interest and rents thereof and invest the same and the resulting income, dividend, interest and rents thereof so as to accumulate at compound interest to the intent that such accumulations shall be added to the principal trust fund until the settler 's daughter Chandrika shall attain the age of eighteen years which age she will attain on the 1st February 1959 and after the expiration of the above named period the Trustees shall deal with and dispose of the trust fund as hereinafter stated. The Trustees shall hold and stand possessed of the trust fund and the accumulations thereof upon trust to pay the net interest and income thereof after deducting all out goings and charges for collection to the said Chandrika for her life for her maintenance. " It is clear from these clauses that during the minority of Chandrika, the income from the trust funds was to be accumulated and added to the trust funds and after the attained majority on February 1, 1959, she was to get only the income from the enlarged trust funds. Now, in the relevant year of account Chandrika was still a minor and under the terms of the trust deed she had no right to the trust income nor any beneficial interest therein; she could neither receive nor enjoy the income. She did not derive any benefit whatsoever from the trust funds during her minority and even after she attained majority, she did not have any right to the trust income which arose during her minority and her only right was to enjoy the income arising from the enlarged trust funds, i. e., the original trust funds and the accumulations of trust income during her minority. Therefore, the sum of Rs. 410/ was not the income of Chandrika, but was the income of the trustees and the income was impressed with a trust, namely, that it should be added to 908 the trust corpus. The question is, does section 16(3)(b) apply to such a case ? We shall presently read section 16(3), but before we do so it is necessary to refer to the scheme of section 16 of the Income tax Act. The section deals with the computation of total income as defined in section 2(15) of the Act, and provides that what sums are to be included or excluded in determining the total income. The definition of total income in section 2(15) involves two elements (a) the income must comprise the total amount of income, profits and gains referred to in section 4(1), and (b) it must be computed in the manner laid down in the Act. The exemption granted under the Act is of two kinds; certain classes of income are exempted from tax and also excluded from the computation of total income, while certain other classes of income exempted from tax are to be included in the assessee 's total income. Now cl. (a) of sub section (i) of section 16 provides the sums exempted from tax under certain provisions of the Act should be included in the assessee 's total income. Clause (b) lays down the mode of computing a partner 's share in the profit or loss of the firm. Under cl. (c) income which arises to any person by virtue of any settlement or disposition from assets remaining the property of the settler or disponer etc. is taxed as his income. The object of the legislation is clearly designed to overtake and circumvent a tendency on the part of the tax payers to endeavour to avoid or reduce tax liability by means of settlements. Sub section (2) deals with grossing up of dividend etc. Then we come to sub section (3). This sub section aims at foiling an individual 's attempt to avoid or reduce the incidence of tax by transferring his assets to his wife or minor child or admitting his wife as a partner or admitting his minor child to the benefits of a partnership in a firm in which such individual is a partner. The sub section creates an artificial 909 liability to tax and must be strictly construed. Now, let us read the sub section. (3) In computing the total income of any individual for the purpose of assessment there shall be included: (a) so much of the income of a wife or minor child of such individual as arises directly or indirectly: (i) from the membership of the wife in a firm of which her husband is a partner; (ii) from the admission of the minor to the benefits of partnership in a firm of which such individual is a partner; (iii)from assets transferred directly or indirectly to the wife by the husband otherwise than for adequate consideration or in connection with an agreement to live apart; or (iv) from assets transferred directly or indirectly to the minor child, not being a married daughter by such individual otherwise than for adequate consideration; and (b) so much of the income of any person or association of persons as arises from assets transferred otherwise than for adequate consideration to the person or association by such individual for the benefit of his wife or a minor child or both. " The argument on behalf of the appellant is that the conditions laid down in cl. (b) of sub section (3) of section 16 are fulfilled in the present case and therefore the Department was intitled to include in the 910 total income of the assessee so much of the income in the hands of the trustees as arose from the assets transferred by the assessee for the benefit of his minor child. It is pointed out that the conditions laid down in cl.(b)are (1) that there must be income in the hands of any person or association of persons (trustees in the present cases;) (2) the income must arise from assets transferred otherwise than for adequate consideration to the trustees; and (3) the transfer must be for the benefit of the minor child. It is argued that when the conditions are fulfilled and the only exceptional case, namely, where the transfer is for adequate consideration is out of the way, cl. (b) must apply and the Department is entitled to include the income in the hands of the trustees in computing the total income of the individual assessee who made the transfer. At first sight the argument appears to be attractive and supported by the words used in the clause. On a closer scrutiny, however; it seems to us that cl. (b) must be read in the context of the scheme of 16 and the two clauses (a) and (b) of sub section (3) thereof must be read together. So read the only reasonable interpretation appears to be the one which the High Court accepted, namely, that the scheme of the section requires that an assessee can only be taxed on the income from a trust fund for the benefit of his minor child, provided that in the year of account the minor child derives some benefit under the trust deed either he receives the income, or the income accrues to him, or he has a beneficial interest in the income in the relevant year of account. But if no income accrues, or no benefit derived and there is no income at all (so far as the minor child is concerned), then it is not consistent with the scheme of section 16 that the income or benefit which is non existent so far as the minor child is concerned, will be included in the income of his father. Take, for example, a case where the assets 911 were transferred otherwise than for adequate consideration for the benefit of a minor child, but the child has attained majority before the relevant year of account. After the child attains majority the sub section would cease to apply and the income from assets transferred for the benefit of the child would no longer be taxable in the parent 's hands. The reason must be that in the relevant year of account there is no benefit to the minor child by the transfer, even though the transfer was originally made for the benefit of the child. The same principle may be illustrated by another example which has been dealt with by the High Court. Take a case where there are intermediate beneficiaries before the minor gets the benefit under the trust deed. In such a case the learned Advocate for the Department conceded in the High Court that cl. (b) of sub section (3) of section 16 would not be attracted till the minor derived benefit under the trust deed. Mr. Rajagopal Sastri did not make any such concession before us; but seems to us that principle underlying the illustration is incontestable. If the minor derives no benefit in the relevant year of account, it can hardly be said that for that year the transfer was for the benefit of the minor child. Section 4, the charging section, of the Income taxs Act makes it clear that what is taxed is the total income of the relevant account year, and total income, according to section 2 (15), is the income, profits and gains referred to in sub section (1) of section 4 and computed in the manner laid down in the Act. In other words, the tax is levied on a yearly basis. It is true that in the present case there was income in the hands of the trustees and the trustees were liable to pay tax thereon. That, however, is not the question before us. The question before us is whether such income in the hands of the trustees could be included in the total income of the assessee under cl. (b) of sub s.(3) of section 16. In our opinion, when 912 cl. (b) of sub section (3) of section 16 talks of benefit of the minor child it refers to benefit which arises or accrues to the minor in the year of account. If there be no such benefit, the income cannot be included in the total income of the individual who made the transfer. There is a third type of case which also illustrate the same principle. If only a portion of the income of the trust is reserved for the minor child, cl, (b) would apply and that portion of the income which is set apart for the benefit for the child would be taxable in the hands of the settler. All these illustrations only establish the principle that the minor child must derive some benefit in the relevant year of account before cl. (b) would apply. Furthermore, we are also of the view that cls. (a) and (b) of the sub section must be read together, Clause (a) begins with the expression "so much of the income of a wife or minor child of such individual as arises directly or indirectly", and this is followed by the four circumstances numbered (i), (ii), (iii) and (iv). There is no doubt that so far as cl. (a) is concerned, there must be income of the wife or minor child. Mr. Rajagopal Sastri has not disputed this. The obvious intention of the Legislature in enacting cl. (b) was to see that the provisions of cl. (a) were not defeated by the assessee creating a trust and in order to deal with that mischief it enacted cl. Instead of the expression "so much of the income of a wife or minor child" the expression used in cl. (b) is "so much of the income of any person or association of persons etc.". Obviously, when a trust is created the income is income in the hands of the trustees. But the underlying principle in the two cls. (a) and (b) appears to be the same, namely, there must be income of the wife or minor child under cl.(a) and there must be some benefit derived by the wife or minor child in the year of account under cl.(b). This is consistent with the scheme of section 16 913 and particularly sub section (3) thereof. which is intended to foil an individual 's attempt to avoid or reduce the incidence of tax by transferring his assets to his wife or minor child etc. When, however, the minor child derives no benefit under the trust deed in the year of account, it is not consistent with the scheme of section 16 to say that even though there is no accrual of and income or benefit in the year of account in favour of the minor child, yet the income must be included in the total income of the individual concerned. Our attention has been drawn to section 64 of the Income tax Act, 1961 (43 of 1961). That section corresponds to section 16 of the Income tax Act, 1922 and cl. (v) of section 64 has made the position clear by using the expression 'immediate or deferred benefit" so that even a benefit which is postponed and does not arise in the year of account will not entitle the Department to include the income in the hands of the trustees in the total income of the settler. We do not, however, think that the Act of 1961 can be taken as declaratory of the law which excited previously; nor can s 64 (v) be taken as determinative of the true scope and effect of cl. (b) of sub section (3) of section 16. The Legislature may have thought fit in its wisdom to widen the scope of the law that existed previous to it so as to take in deferred benefits as well. We think that we must interpret cl. (b) of sub section (3) of the context of the section as it occurs in the Income tax Act of 1922. We have been referred to two English decisions Dale vs Mitcalfe (1) and Mauray vs Commissioners of Inland Revenue (2). One of the decision Dale vs Mitcalfe (1) related to section 25 of the English Income Tax Act, 1918 (8 & 9 Geo. V. C. 40) and the other related to section 20(1)(c) of the English Finance Act 1922 (12 and 13 Geo V. C. 17). Those provisions were differently worded and appear in a different 914 context and decisions of the English Courts given on provisions differently worded and appearing in a different context are not, in our opinion, helpful in determining the true scope and effect of cl. (b) sub section (3) of section 16 of the Income tax Act, 1922. We have therefore, come to the conclusion that on a true construction of cl. (b) of sub section (3) of section (3), the view expressed by the High Court was correct and the sum of Rs. 410/ did not form part of the total income of the assessee. The High Court correctly answered the first question referred to it. We now turn to the second question. The relevant clause of the trust deed of December 1, 1941 is cl. 7 which reads as follows: "The trustees shall hold and stand possessed of the Trust Fund mentioned in the second Schedule hereto and the accumulations thereof referred to in clause 3 thereof upon Trust to pay the net interest and income thereof to the Settler 's son MANILAL for the maintenance of himself, his wife and for the maintenance, education and benefit of all his children till his death. " The question before us is whether under this clause the income received by the assessee is impressed with a trust in favour of himself, his wife and children to whom he is accountable as a trustee for the amount received. In other words, the question is whether the trust deed of December 1, 1941, created two trusts, the one requiring the trustees to pay the income from the trusts funds to the assessee and the second requiring the assessee to spend the income for the maintenance of himself and his wife and for the maintenance, education and benefit of his children. In cases where property is given to a parent or other person standing or regarded as in loco parentis, with a direction 915 touching the maintenance of the children, the question often arises whether the settler intended to impose a trust by the direction or whether the direction was only the motive of the gift. The line between the two classes of cases has not been drawn always very firmly. It is, however, clear that in construing provisions of this kind the Court will not enforce or treat as obligatory a mere wish or desire or hope on the part of the settler that the donee of the fund should or would ought to or is expected to apply it for the benefit of other persons; on the other hand, the Court does regard as binding and obligatory and does enforce a direction or trust in favour of third parties if such a binding obligation can be clearly ascertained from the document. Instances of cases where no trust is created and of cases where trust is created and detailed at pages 85 and 86 of Lewin on Trusts (15th Edition). We are unable to hold that in the case before us cl. 7 of the trust deed merely expressed a wish or desire or hope on the part of the settler. We are in agreement with the High Court that the direction contained in cl. 7 created a trust in favour of the assessee, his wife and children. The expression "for the maintenance of himself and his wife and for the maintenance, education and benefit of all his children" is not indicative of a mere desire or hope. It imposes a binding and obligatory trust. In re. Booth, Booth vs Booth (1) a testator gave the residue of his estate to his executors, on trust, to pay to his wife or permit her to receive the annual income thereof during her life, "for her use and benefit and for the maintenance and education of my children". It was held that the wife took the income subject to a trust for the maintenance and education of the 916 children. A similar view was expressed in Raikes vs Ward (1) and Woods vs Woods (2) On behalf of the appellant our attention was drawn to section 8 of the (II of 1882) which states that the subject matter of a trust must be property transferable to the beneficiary and it must not be merely beneficial interest under a subsisting trust. It is contended that the assessee held a beneficial interest in the income from the trust funds under the trust deed of December 1, 1941, and in respect of beneficial interest another trust could not be created in favour of himself, his wife and children. We think that this argument proceeds on a misconception. The assessee did not create a second trust in respect of the beneficial interest which he held under the trust deed of December 1, 1914. The assessee father created two trusts by that trust deed, one requiring the trustees to pay the trust income to the assessee and the other requiring the assessee, who was himself a trustee, to spend the income for the maintenance, education and benefit of his children. It is not disputed that by a single document more than one trust may be created. It is not, therefore, true to say that the subject matter of the trust in the present case was merely a beneficial interest under a subsisting trust. Under section 41 of the Income tax Act it was open to the Department either to tax; the trustees of the trust deed or to tax those on whose behalf the trustees had received the amount. The true position of the assessee in this case was that he was a trustee and not the sole beneficiary under the trust deed. He held the income on trust for himself, his wife and his children. The shares of the beneficiaries were indeterminate and therefore under the first proviso to section 41(1) of the 917 Income tax Act, it was open to the Department to levy and recover the tax at the maximum rate from the assessee; but that did not entitle the Department to include the sum of Rs. 14,170/ in the total income of the assessee as though he was the sole beneficiary under the trust deed, Mr. Rajagopal Sastri made it clear that the intention of the Department was to include the sum in the total income of the assessee in order to levy and charge super tax on him. This, we do not think, the Department was entitled to do. In respect of the sum of Rs. 14,170/ the assessee was a trustee, within the meaning of section 41 of the Income tax Act, appointed under a trust declared by a duly executed instrument in writing and as such trustee he had the right to contend that his assessment in respect of the money received by him not as a beneficiary but as a trustee could only be made under the first proviso to section 41 (1). We have, therefore, come to the conclusion that on the second question also the answer given by the High Court was correct. The result, therefore, is that the appeal fails and is dismissed with costs. Appeal dismissed.

In 1953 the assessee created a trust in respect of a sum of money and provided that the interest on that amount was to be accumulated and added to the corpus and that his minor daughter C was to receive the income from the corpus increased by the addition of interest when she attained the age of 18 years. In the relevant account year, when C was still a minor, the income derived from the trust fund was Rs. 410 Earlier in 1941, the assessee 's father had created a trust in respect of certain shares and money directing the trustees to pay the net interest and income thereof to the assessee "for the maintenance of himself and his wife and for the maintenance, education and benefit of all his children till his death". In the relevant account year a sum of Rs. 14,170 accrued as income in the hands of the assessee from the said trust funds, 903 The taxing authorities included both these incomes in the total income of the assessee. ^ Held, that neither of these two incomes could be included in the total income of the assessee. Under section 16(3)(b) of the Indian Income tax Act, upon which the authorities relied, the assessee could only be taxed on the income from the trust funds for the benefit of his minor child if in the year of account the minor child either received the income or it accrued to her or she had a beneficial interest in the income in the relevant year of account. In the present case though there was income in the hands of the trustees and they were liable to pay tax thereon, there was no benefit to the minor child in that year. As such the sum of Rs. 410 did not form part of the total income of the assessee. The trust deed of 1941 created two trusts, the one requiring the trustees to pay the income from the trust funds to the assessee and the second requiring the assessee to spend the income for the maintenance of himself and his wife and for the maintenance, education and benefit of his children. It was not a case where the settler merely expressed a wish or desire or hope but he gave as direction which created a trust in respect of the income in the hands of the assessee in favour of himself, his wife and children. The assessee did not create the second trust in respect of the beneficial interest which he held under the trust of 1941 and section 8 of the Indian Trusts Act which forbade the creating of such a trust was inapplicable. The assessee was a trustee and not the sole beneficiary; and since the shares of the beneficiaries were Indeterminate it was open to the Department to levy and recover tax at the maximum rate from the assessee as trustee under the first proviso to s.41(1) but the Department was not entitled to include the sum of Rs. 14,170 in the total income of the assesse as though he was the sole beneficiary under the trust deed.

C.A No. 10 of 1961. Appeal from the judgment and decree dated March 5, 1956 of the Madras High Court in A.S. No. 256 of 1951, R. Ramamurthi Aiyar and R. Gopalakrishanan, for the appellants. R. Ganapathy Iyer and D. Gupta, for the Respondent. February 1. The Judgment of the Court was delivered by 957 SHAH, J. Messrs. Ramalingam & Co. hereinafter called the assessees are a firm doing business principally as exporters of vegetable fibres to foreign countries. They have their place of business at Tuticorin in the district of Tirunelveli in the State of Madras. The contracts of sale are made by correspondence on approval of samples sent by the assessees to the foreign buyers. The contracts are C.I.F. or C.F. and the price is payable by draft upon bank credit to be opened by the buyer. The course of dealing between the assessees and the foreign buyers was as follows: After the contract for a quantity of goods was finalised by correspondence and the price ascertained the foreign buyer opened with his own bankers an irrevokable Letter of Credit in favour of the assessees for 95% of the net invoice value. Intimation of the opening of the Letter of Credit was then given to the assessees through a bank operating in the Province of Madras. The assessees then shipped the goods, obtained Bills of Lading in their own names and lodged the shipping documents endorsed in blank with their own bankers together with the invoice and Bill of Exchange for 95% of the invoice value. The assessees then discounted the Bills through their own bankers. The shipping documents were forwarded to the foreign banker who on presentation paid 95% of the invoice amount. The Bill of Lading was then delivered by the foreign banker to the buyer and the goods were unloaded. For the year 1945 46 the Commercial Tax Officer, Tirunelveli determined for the purpose of computing tax liability under the Madras General Sales Tax Act, 1939, the turnover of the assessees at Rs. 15,61,200/ . The Commercial Tax Officer rejected the claim of the assessees that the amount of Rs. 15,22,000/ in respect of overseas transactions 958 was exempt from liability to tax. He held that the export transactions in respect of which the exemption was claimed were sales within the province of Madras and subject to sales tax under the Madras General Sales Tax Act, 1939. The order of the Sales tax Officer was confirmed by the Board of Revenue, Madras, except as to the amount of freight. The Board of Revenue held that the property in the goods passed to the buyers in a large majority of the export transactions when the goods were shipped. On remand, the commercial Tax Officer recomputed the turnover at Rs. 11,23,603/8/8 inclusive of the local sales of the value of Rs. 75,082/14/0. After paying the tax the assessees sued the Province of Madras in the Court of the Subordinate Judge, Tuticorin for a decree for Rs. 10,485/ being the amount of tax paid by them on export sales pursuant to the order of assessment and interest thereon at 6% until realisation. The assessees contended that the export sales were at the material time "totally outside the provisions of the Madras General Sales Tax Act, and the order of assessment was ultra vires and beyond the powers of the authorities". The Subordinate Judge decreed the claim for Rs. 10,323/ with interest at 6% till realization. In appeal, the High Court of Madras reversed the decree and dismissed the suit filed by the assessees. With certificate granted by the High Court this appeal is preferred by the assessees. It is common ground that in the year 1945 46, under the Madras General Sales Tax Act; 1939, the taxing authorities had no power to levy sales tax on sales which took place outside the Province. The decision of the appeal, therefore, depends upon the determination of the question whether the export sales took place within the Province. If they took place within the Province, the sales were properly taxed. We may observe that the plea that a suit for a decree for refund of tax paid in pursuance of 959 an order of assessment passed by the taxing authorities on the basis that the sales took place within the Province did not lie in the civil court, was not raised in the Court of First Instance, nor in the High Court. Counsel for the State of Madras has also stated before us that he does not desire to contend in this case that the suit was, in view of the adjudication by the taxing authorities, not maintainable. We therefore proceed to deal with the only question which was debated before us at the Bar: whether the export sales which are the subject matter of dispute in this appeal were completed within the Province of Madras. The dispute relates to turnover in respect of seventeen export transactions with merchants in different destinations overseas. As typical of the transactions the files relating to the shipments to Messrs Begbie Philips and Haylay, London and Messrs Hindley and Company, London were tendered in evidence and the case proceeded to trial on the footing that those transactions were typical of all other transactions. On April 16, 1945, the Mercantile Bank of India wrote a letter in connection with the shipment to Messrs Begbie Philips and Hayley, London about a contract of sale of five tons palmyra fibre. The letter is in the following terms: "Dear Sirs, Without any responsibility on the part of this bank we beg to advice receipt of a telegram from our London office reading: "We open irrevocable credit favour Ramalingam Company, Tuticorin, $400 (four hundred pounds) drafts on Mercantile Bank of India Limited, 60 d/st. invoices, full set shipped bills of lading order bank endorsed certificate of origin insurance covered in London about 5 tons palmyra fibre at $80 (eighty pounds) not per ton C and F. Shipment soonest India to 960 United Kingdom by approved ship. Part shipments allowed expiry 6th October, 1945 a/c Bagbie Phillips Hayley, Limited, licence No. 198281. " When submitting documents under this credit we would emphasise the fact that the goods must be described both in the bill of lading and invoice identically as advised above and the relative bill marked "Drawn under telegraphic credit No. 88 A/36 of 12th April 1945". We shall furnish you with further particulars on receipt of written confirmation. Owing to frequent mutiliations in coded telegrams the above message is subject to any necessary corrections on receipt of confirmation by mail. Kindly note that the negotiation of bills under this credit is entirely optional on our part and this advice does not release you from the liability attaching to the drawer of a Bill of Exchange. This letter must be produced with all bills drawn under this credit. Yours faithfully (signed). Manager". On May 28, 1945, the National Bank of India, Tuticorin wrote a letter to the assessees in regard to a sale of a quantity of fibre, which is as follows: "Dear Sirs, We beg to inform you that we are in receipt of advice by cable of 24th instant 961 from our London office that they have received from Messrs Hindley and Company, Limited, No. 35, Crutched Friars, London, E. C. 3 an undertaking to honour your bills on Messrs. Hindley and Company, Limited No. 35 Crutched Friars, London E. C. to the extent of $370 (three hundred and seventy pounds) sterling being 95 per cent of invoice value on the following conditions: Bill to be drawn payable 90 days after sight and to be accompanied by Invoices. Full sets of on board bills of lading made out to order and blank endorsed representing shipments of: Five tons Tuticorin medium cut and dyed bassine 7 inches and 7 1/2 inches equally at $78 per ton in 1 Cwt. (ballots) C and F United Kingdom post Shipment June/July from Cochin freight paid of deducted and credit reduced accordingly Freight basis 22nd May, 1945. Insurance including was risk with unlimited transshipment covered in London. Such shipping documents are to be delivered on payment of the bills which should bear the clause "Drawn under N.S.I. credit number 83 cabled 24th May 1945". Bills fulfilling the above mentioned conditions must be negotiated on or before Extended till 30th April 1946. Please note that the bank accepts no liability for the above undertaking and this advice does not release you from the liability attaching to the drawer of a Bill of Exchange. The above message is continued by us on behalf of the opening bank for your information but without any responsibility on our 962 part except for the correctness of this copy of the telegram as received by us. When negotiating bills please produce this letter to have the amounts recorded on the back hereof. I am, Dear Sirs, Yours faithfully (Signed). Manager. " On receipt of intimation the assessees shipped the goods and handed over the Bill of Lading and the invoice to their own bankers, accompanied by a Bill of exchange for the amount for which the Letter of Credit was opened by the foreign banker. The assessees then discounted the bills for the amount for which credit was opened. The taxing authorities taxed these transactions, because, in their view, the sales were effected in the Province of Madras and not outside. The assessees in the plaint in paragraph IV cl. (e) stated that one of the salient features of the business was that "The bills of lading are handed over to the Plaintiffs bankers with the clear and definite instructions to pass on the shipping documents to the buyers only on payment. They are what is styled in commercial parlance as D/P bills, i.e., documents to be handed over on payment". This averment in the plaint was not traversed in their written statement by the defendants. The only witness examined at the trial was A.V. Samuel, one of the partners of the assessees ' firm. He deposed to the practice which was followed by the assessees. He stated. "After shipment we obtain Bill of lading made out in our name as shipper. We draw a bill of Exchange and along with bill of lading and invoice. These documents are deposited with National Bank. We endorse in Bank on the Bill of Lading. It is only after payment of 963 the Bill of exchange by the foreign Bank on behalf of the purchaser, the Bill of Lading is handed over. Till the bill is paid for no title in the goods pass and the goods are at our disposal. If the bill is not honoured the Bank will ask us for directions as regards the disposal of goods. Under instruction from the buyers foreign banks give instruction to any local Bank to give credit up to a certain limit. Inspite of letter of credit as drawers we are responsible under the bill of exchange. We can discount in any bank and not merely in the credit opening bank. " In cross examination he stated that the "credit opening bank opens credit on behalf of the purchasers. Those banks are not known to us before. " It is clear from the terms of the two letters dated April 16, 1945, and May 28, 1945, that the foreign buyers had opened letters of credit for the benefit of the assessees, for the amounts set out therein. These, it appears, were general credits and intimation thereof was given by the local bankers in India who were agents of the foreign bankers. The local bankers, however, did not undertake any liability by intimating the opening of the letter of credit and the assessees were expressly informed that they (the assessees) would not be released from their liability under the Bills of Exchange drawn by them. The assessees negotiated the Bills through their bankers after receiving an intimation of the opening of credit. Counsel for the State of Madras submits that the property in the goods which were the subject matter of sale passed in Tuticorin when the assesees received an amount which represented the price the goods against delivery of the Bills of Lading endorsed in blank with authority to complete the endorsement. In substance, the plea is that the oreign bank opening the letter of credit is an agent 964 of the buyer, and that bank authorizes its own branch to pay the price to the shippers and by the arrangements made by opening the letter of credit, price is paid to the vendor in his own country against the bill of Lading endorsed in blank. It is necessary to appreciate the true nature of the commercial letter of credit extensively used in foreign trade. During the last few decades, expansion of international trade involving overseas transactions has raised problems of peculiar difficulty. The parties to a contract to supply goods are generally unknown to each other and the contract is the result of correspondence between the parties. Often neither the seller nor the buyer is prepared to trust the other. Again, between the delivery of the goods in such trade on board the ship and its ultimate delivery at the destination, the seller is reluctant to tie up his funds. The seller himself in generally a purchaser of goods from the local market and has invested funds in purchasing the goods. The buyer is also unwilling to make payment in advance. To tide over the problem created by this reluctance of the seller and the buyer, bankers of international repute and credit interpose. They for a small commission undertake by opinion letters of credit to honour the Bill of Exchange drawn by the seller accompanied by the insurance policy and the invoice relating to the goods forming the subject matter of the contract. At the instance of the buyer the banker issues a letter of credit which is addressed to the world at large or more frequently to specified person or persons: thereby the banker undertakes to honour the Bills of Exchange drawn on the faith of that letter. Invariably, the Bills are payable in future but the exporters as the beneficiaries under the contract, have the guarantee of the banker that payment will be forthcoming and are also entitled to discount the bills with any party cognisant of the undertaking of the original 965 banker. There are generally four parties to such a transaction the buyer, the seller, the banker who issues the letter of credit, called the issuing banker and the intermediary or the negotiating banker who allows credit to the seller on the bills lodged with him. Between the buyer and the issuing banker, the contract is that he will pay bills drawn by the seller of the goods against delivery of the Bill of Lading, insurance certificate and invoice. The buyer undertakes to put the banker in funds to enable him to make payment if the documents are presented. The relation between the buyer and the banker is not of pricipal and agent. The contract between the issuing banker and the negotiating banker may be of a dual character. Where the issuing banker 's instructions are merely to advise the credit, and the credit calls for bills to be drawn either on the issuing banker or on the buyer, the intermediary banker may negotiate the beneficiary 's bills. In such a case he stands qua the issuing banker as principal to principal, for either he succeeds to the rights of the beneficiary under the credit or, if he negotiates relying on the credit alone, as acceptor of the offer it contains. If the instructions call upon the intermediary banker to pay or to negotiate the beneficiary 's bills, the intermediary banker is the issuing banker 's agent. Under the terms of the contract between the assessees and the foreign buyer the price was to be paid "by draft after 90 days under bank credit to be opened by the buyer for 95% of the net invoice amount. " By the letter of credit the foreign banker guaranteed to pay the amount in London. The issuing bank intimated the opening of the letter of credit, but there is no evidence of any express directions to its agent in India to pay or negotiate the draft. The letter of credit was general; and it was open to any bank on the faith 966 thereof to negotiate the bill issued by the assessees. The payment made by the intermediary bank was not and could not therefore be on behalf of the issuing bank much less on behalf of the buyer. By negotiating the bill, the banker of the assessees became the acceptor of the offer contained in the letter of credit of the issuing bank, and as such acceptor obtained the Bill of Lading, the invoice and the Bill of Exchange and presented them for payment. This arrangement was not an arrangement for payment of price on behalf of the buyer. It appears clear from the two letters dated April 4, 1945, and May 28, 1945, that the banks accepted no liability by intimating the opening of the letter of credit and the liability attaching to the assessees by drawing Bills of Exchange was not discharged. If the liability of the assessees, as drawers of the Bills of Exchange continued, the arrangement made by the buyer could not be regarded as one to pay the price through his banker in India. As stated hereinbefore, the relation between the buyer and his issuing banker was not of principal and agent, nor was the relation between the issuing bankar and the intermediary banker that of principal and agent. The two bankers were interposed for the protection of the seller as well as the buyer. The issuing banker did not purport to act as agent of the buyer and the intermediary banker accepted the general offer of the issuing banker by negotiating the draft. By so accepting the offer and by taking over the Bill of Lading, the insurance certificate and the invoice which represented title to the goods the intermediary banker did not act as an agent of the seller. The price in respect of the goods was not received in the Province of Madras, and the property in the goods also did not pass to the buyer 967 within the Province. Tax in respect of the sale of fibre by the assessees under the disputed transactions was therefore not exigible under the Madras General Sales Tax Act. The appeal is therefore allowed: the decree of the High Court is set aside, and the decree of the trial Court is restored with costs in this Court and the High Court. Appeal allowed.

The assessees were doing business principally as exporters of vegetable fibres to foreign countries. The contracts of sale were C.I.F. or C.F. and were made by correspondence on approval of samples sent by the assessees to the foreign buyers. The price was payable by draft upon bank credit to be opened by the buyer; who opened with his own bankers 955 an irrevocable letter of credit in favour of the assessees for 95% of the net invoice value. Intimation of the opening of the letter of credit was then given to the assessees by the local bankers in India who were the agents of the foreign bankers. The local bankers, however, did not by intimating the opening of the letter of credit undertake any liability, and the assessees were expressly informed that they would not be released from their liability under the Bill of Exchange drawn by them. On receipt of the information about opening of the letter of credit the assessees shipped the goods, obtained bills of leading in their own names and lodged the shipping documents endorsed in blank with their own bankers together with the invoice and Bill of Exchange for 95% of the invoice value. Bills of lading were handed over to the assessees bankers with the definite instructions to pass on the shipping documents to the buyers only on payment. The assessees then discounted the Bills through their own bankers. The shipping documents were forwarded to the foreign bankers who on presentation paid 95% of the invoice amount. The Bill of lading was then delivered by the foreign banker to the buyer and goods were unloaded. For the year 1945 46 the Commercial Tax officer taxed the assessees under the Madras General Sales Tax Act, 1930. The Commercial Tax officer rejected the claim of the assessees that the amounts in respect of overseas transactions was exempt from liability to tax, because in his view the export transactions were sales within the province of Madras. The Board of Revenue confirmed the order and held that the property in the goods passed to the buyers in a large majority of the export transaction when the goods were shipped. The assessees contended that the export sales were at the material time totally outside the provisions of the Madras General Sales Tax Act and the order of the assessment was ultra vires and beyond the powers of the Authority. The plea of the State of Madras was that the foreign bank opening the letter of credit is an agent of the buyer, and that the bank authorises its own branch to pay the price to the shippers and by the arrangements made by opening the letter of credit, price is paid to the vendor in his own country against the Bill of lading endorsed in blank. ^ Held, that the price in respect of the goods was not received in the Province of Madras and the property in the goods also did not pass to the buyer within the province. Therefore tax in respect of the sale transactions was not exigible under the Madras General Sales Tax Act 1939. The expansion of international trade involving overseas transactions has raised problems of peculiar difficulty. The 956 parties to a contract (which is as a result of correspondence) are generally unknown to each other; often neither the seller nor the buyer is prepared to trust the other and the seller is reluctant to tie up his funds and the buyer is also unwilling to make payment in advance. To tide over the problem created by this reluctance of the seller and the buyer, bankers of international repute and credit interpose. They for small commission undertake by opening letters of credit to honour the bill of exchange drawn by the seller accompanied by the insurance policy and the invoice relating to goods forming the subject matter of the contract. At the instance of the buyers the bank issues a letter of credit which is addressed to the world at large or more frequently to specified person or persons thereby the bank undertakes to honour the Bills of Exchange drawn on the faith of that letter. Invariably the bills are payable in future but the exporters as the benefit ciaries under the contract, have the guarantee of the banker that payment will be forthcoming and are also entitled to discount the Bills with any party cognisant of the undertaking of the original banker. The relation between the buyer and his issuing banker was not of principal and agent, nor was the relation between the issuing banker and the intermediary banker that of principal and agent. The two bankers were interposed for the protection of the seller as well as the buyer. The issuing banker did not purport to act as agent of the buyer and the intermediary bankers accepted the general offer of the issuing banker negotiating the draft. By so accepting the offer and by taking over the Bill of Lading, the insurance certificate and the invoice which represented title to the goods the intermediary banker did not act as an agent of the seller.

minal Appeal No. 103 of 1952. Appeal under article 134(l) (c) of the Constitution of India from the Judgment and Order dated the 27th October, 1952, of the High Court of Judicature for the State of Rajasthan at Jodhpur (Wanchoo C.J. and Bapna J.) in D.B. Criminal Murder Reference No. 2 of 1952, arising out of the Judgment and Order dated the 1st July, 1952, of the Court of the Sessions Judge, Pali, in Criminal Original Case No. 2 of 1951. H. J. Umrigar for the appellants. Porus A. Mehta for the respondent. February 16. The Judgment of the Court was delivered by MAHAJAN J. This is an appeal under article 134(l) (c) of the Constitution of India, by Magga and Bhagga,who have been convicted under section 302, Indian Penal Code, for the triple murders of Ganesh, Gheesa and Hardas. The case relates to an incident which took place on the night between the 3rd and 4th April, 1951 Gheesa and Ganesh, deceased, Ratna, Govind, another Ganesh who is a witness in the case, and Hardas had gone to " Imaratia " a well in village Gadwara on that night to keep watch over the crops there. Gheesa slept in one shed near the well, while Hardas slept in another shed some distance away, and Ratna slept in a third shed near the entrance gate. Ganesh, deceased, Ganesh (P. W.), and Govind slept on the threshing floor further away from the well. Some time after midnight Ratna woke up on hearing the cries of Gheesa. It is alleged that he then saw the two accused beating Gheesa, accused Magga having in his hand a farsi and accused Bhagga having a katari and an axe. Hardas, who woke up on hearing the cries, rushed to the aid of Gheesa and thereupon the two accused, Magga and Bhagga, fell upon him and attacked him with farsi and axe. Ratna 975 ran away and hid himself near the well. On an alarm being raised, one Krishna who was working on a nearby well came and witnessed the attack on Hardas. The accused, after finishing Gheesa and Hardas went to the threshing floor where Ganesh, deceased, was sleeping. There Magga asked Bhagga to hit Ganesh with the axe and Bhagga immediately hit Ganesh with the axe and he fell down. Thereafter Magga hit Ganesh two or three times with the farsi on the legs and Bhagga cut the neck of Ganesh with the katari. Govind (P.W.) entreated on behalf of Ganesh but he was threatened and was told, that if he did not keep quiet he would also be killed. Without injuring Govind and Ganesh (P.Ws.) the accused then left the place. Information of the incident was carried to the village by Ratna and a report of it was made to the police at 11 30 a.m. on 4th April, 1951. In the report it was stated that " Bhagga and Magga are standing at their house with swords and are saying that they would kill more persons. Village people are surrounding them outside the house ". The sub inspector of police, when he arrived at the village, found the house of the accused surrounded by the village people. The door of the house was closed from inside and the accused were standing on the chabutra inside. Magga had a farsi in his hand and Bhagga had an unsheathed sword. The sub inspector got the door opened, arrested the accused, and took possession of the farsi and the sword. He also recovered the axe and a katari which were bloodstained. The clothes of the accused were also taken possession of after the arrest and they appeared to have bloodstains on them. The accused pleaded not guilty. They admitted their partnership in cultivation at " Imaratia " well with the deceased but denied that any quarrel took place between them and the other partners about the cutting of the crop. They also denied that they had gone to the well armed with various weapons and had committed the murder of Gheesa, Hardas and Ganesh. The sessions judge on the evidence led by the prosecution felt satisfied that the prosecution case was 976 proved beyond all reasonable doubt. It was held that the murder was brutal and advantage had been taken of the persons who were sleeping to kill them. In the result the appellants were convicted under section 302, Indian Penal Code, and sentenced to death. The sentence of death passed on them by the sessions judge was confirmed by the High Court after examining the evidence afresh. In the High Court a contention was raised that the whole trial was vitiated inasmuch as it had not been conducted in accordance with procedure prescribed by law. This contention was negatived on the ground that the irregularities committed in the course of the trial were such as were cured by the pro visions of section 537, Criminal Procedure Code. As the objection raised concerned the validity of the trial the case was certified as a fit one for appeal to this Court. The facts which concern the validity of the trial, shortly stated, are these: The trial began on 22nd March, 1952. Three assessors had been summoned for that date. Of these two were present while the third did not come. Thereupon one person who was present in the court premises and whose name was in the list of assessors but who had not been summoned in the manner prescribed by the Code of Criminal Procedure was chosen as an assessor. The trial then began with the three assessors so chosen, viz., Jethmal, Balkrishna and Asharam. On the 6th June, 1952, Jethmal, one of the assessors absented himself and for some reason, which is not clear from the record, one Chimniram was asked to sit in place of Jethmal as an assessor with the result that on the 6th June, 1952, there were three assessors, viz., Balkrishna and Asharam, who had been sitting from the beginning of the trial, and Chimniram who was introduced for the first time that day. On the 23rd June also Chimniram, Balkrishna and Asharam sat as assessors. On 27th June, however, Jethmal reappeared and was allowed to sit and since that date four assessors sat throughout, viz., Jethmal, Chimniram, Balkrishna and Asharam. Eventually all these four assessors gave their opinion on the first 977 July, 1952, when the trial came to an end. It was con tended that the trial was bad as it took place in defiance of the provisions of sections 284 and 285 of the Code of Criminal Procedure and that such an illegality could not be cured by the provisions of section 537 of the Code. In order to judge of the validity of this objection it is necessary to set out the provisions of the Code relevant to this matter. Section 284 provides that, "When the trial is to be held with the aid of assessors, not less than three and, if possible, four shall be chosen from the persons summoned to act as such" . The section as it originally stood required that " two or more shall be chosen as the Judge thinks fit ", so that there had to be a minimum of two assessors. In the year 1923, that provision was amended so as to make a minimum of three assessors an essential requisite for a trial to be held with the aid of assessors. A trial commenced with less than three assessors is not authorised by the provisions of this section as it now stands. Therefore, unless a case comes within the provisions of the next following section 285, a trial held in defiance of the provisions of section 284 would not be legal. Section 285, however, has no application to cases where a trial is commenced with less than three assessors. [Vide Balak Singh vs Emperor (1); Sipattar Singh vs King Emperor (2)]. Section 285 provides : "(1) If in the course of a trial with the aid of assessors, at any time before the finding, any assessor is from any sufficient cause, prevented from attending throughout the trial, or absents himself, and it is not practicable to enforce his attendance, the trial shall proceed with the aid of the other assessor or assessors. (2)If all the assessors are prevented from attending or absent themselves, the proceedings shall be stayed and a new trial shall be held with the aid of fresh assessors. " In cases contemplated by this section a trial commenced with the aid of three assessors can be (1) A.I.R. 1918 Pat. (2) A.I.R. 1942 All, 140. 978 continued and finished with the aid of less than three assessors. This section, however, does neither authorize the substitution of an assessor for an absent assessor, nor does it authorise an addition of an assessor to the number of assessors during the course of the trial. The effect of the provisions of sections 284 and 285 is that a trial cannot be validly commenced with less than three assessors chosen in the manner prescribed by the Code, but once validly commenced it can be continued in certain cases to a finish if some, though not all, of the persons originally appointed, attend throughout the trial. If all of them do not attend, then a fresh trial has to be held. An addition in the number of the assessors or a change or substitution in their personnel during the course of the trial is not warranted by the Code; on the other hand, it is implicitly prohibited. The procedure prescribed by section 285(l) is not of a permissive nature. It has to be followed if the conditions prescribed are fulfilled, and like section 285(2) it is of a mandatory character. No scope is left in these provisions for the exercise of the discretion of the judge for supplementing these provisions and for holding a trial in a manner different from the one prescribed and for conducting it with the aid of some assessors originally appointed, and also with the aid of some others recruited during the trial. Section 309 provides that when a trial is concluded, the court may sum up the evidence for the prosecution and defence and shall then require each of the assessors to state his opinion orally and shall record such opinions. Sub clause (2) of this section enacts that the judge shall then give judgment, but in doing so shall not be bound to conform to the opinions of the assessors. Sections 326 and 327 enact the method and manner of summoning assessors and jurors. Section 537 provides as follows: "Subject to the provisions hereinbefore contained, no finding, sentence or order passed by a Court of competent jurisdiction shall be reversed or altered under Chapter XXVII or on appeal or revision on account 979 (a)of any error, omission or irregularity in the complaint, summons, warrant, charge, proclamation, order, judgment or other proceedings before or during trial or in any inquiry or other proceedings under this Code, or. (c)of the omission to revise any list of jurors or assessors in accordance with section 324, or (d)of any misdirection in any charge to a jury, unless such error, omission, irregularity or misdirection has in fact occasioned a failure of justice. " The first objection that was taken in the High Court to the validity of the trial was that Asharam who had not been summoned as an assessor could not be appointed as such and hence it should be held that the trial commenced with a minimum of two assessors in defiance of the provisions of section 284. What happened was this: On the date fixed for the trial there was a deficiency in the number of persons who had been summoned and who appeared to act as assessors, the court then sent for Asharam whose name was in the list of assessors and ordered him to sit as an assessor. The High Court took the view, and we think rightly, that the circumstance that the formality of issuing a summons was not gone through was a mere irregularity which was curable under section 537 of the Code, as there was no failure of justice caused on account of that irregularity and that the trial on that account could not be held to be bad. This view is in accord with the decision of the Calcutta High Court in King Emperor vs Ramsidh Rai(1) with which we agree. We are constrained, however, to observe that the High Court did not fully appreciate the decision of the Patna High Court in Balak Singh vs Emperor(2), when it said that that decision held a trial bad where a person was chosen as an assessor who had not been summoned. In that case during the examination of the first witness only one qualified assessor was present in court and capable of acting as such, the judge ordered another person who happened to be present in court but was not in the official list of assessors to act as an (1) 30 Crl. L. J . (2) A.I.R. 1918 Pat. 420. 980 assessor, and it was held that as the trial commenced with only one assessor and not with two duly qualified assessors the trial was abortive and contrary to law. No exception could therefore be taken to the rule stated in this decision. The second objection against the validity of the trial taken before the High Court was founded on section 285. It was contended that when one of the assessors appointed absented himself the court was bound, under section 285, to ascertain before proceeding further with the trial whether the absence of the assessor was due to sufficient cause and whether it was practicable to enforce his attendance and that the judge in this case failed to observe this condition which alone entitled him to continue the trial with the remaining assessors and that the defect was fatal to the validity of the trial. The High Court held that though there was non compliance with the provisions of section 285 in the case, this irregularity was cured by section 537 as it had not in fact caused failure of justice. We agree with the High Court in this conclusion. It is no doubt true that the section enjoins on the judge a duty to find whether there is a sufficient cause for the non attendance of an assessor and whether it is not practicable to enforce his attendance, and ordinarily the proceedings must represent on their face whether this duty has been performed, but we think that such an omission on his part does not necessarily vitiate the trial. We are further of the opinion that when a judge proceeds with a trial in the absence of one or two of the assessors with the aid of the remaining assessor or assessors, it may be presumed that he has done so because he was satisfied that it was not practicable to enforce the attendance of the absent assessor or assessors and that there was sufficient cause for his or their non attendance. If, however, there is evidence to a contrary effect, the matter maybe different. Failure to record an order indicating the reasons for proceeding with the trial with the aid of the remaining assessors can at best be an irregularity or an omission which must be held to 981 be such as to come within the reach of section 537 unless it has in fact occasioned a failure of justice. It could not be seriously argued that such an omission can lead to such a result. Finally the learned counsel contended, also relying on section 285, that the sessions judge had no jurisdiction or power to substitute an assessor or to reinstate the absent assessor, or to add to the number of assessors. When the point was raised before the High Court, it fully realized that there was no provision in law which permitted such substitution of an absent assessor by another assessor or the subsequent reinstatement of an absent assessor as bad been done in this case. It, however, felt that the irregularity was of the same nature as noncompliance with the provisions of section 285, and as such was cured by section 537 of the Code. In regard to the addition of an assessor during the trial it said: " We have not been able to find any reported case where an assessor had been added in the middle of the trial as has been done by the learned judge. That is perhaps due to the fact that no judge ever did such an obviously silly thing, but considering that the trial, in any case, continued with the aid of two assessors who were there throughout, there was, in our opinion, substantial compliance with the mode of trial provided in the Code and the irregularity committed by the addition of Chimniram in June, 1952, is curable under section 537 as it did not occasion any failure of justice. The sessions judge was still the court of competent jurisdiction to try the case and all that he did was to add unnecessarily one more assessor to advise him when he had no business to do so. We can ignore his presence altogether and as the irregularity has not caused failure of justice, the trial will not be vitiated". In our judgment, the High Court was in error in this view. The sessions judge during the progress of the trial not only made a change in the personnel of the assessors originally appointed and also added to their number, but he. actually took the opinions 127 982 of all the four assessors as required by the provisions of section 309 of the Code, and acted in accordance with those opinions in convicting the two appellants. It is plain that a unanimous verdict of four assessors is bound to weigh much more with a judge than the opinion of two persons. We have not been able to understand how the High Court could ignore the presence of assessors altogether who had given their opinions and which opinions had been accepted by the judge. The opinion of an assessor is exercised in the judicial function imposed upon him by law, and the judge is bound to take it into consideration and he cannot dispense with it. The judge considered this trial as if lie had commenced it with the aid of four assessors, and taking into consideration their opinion, he convicted the appellants. It is difficult to assess the value which the judge gave to the opinions of the assessors at the time of arriving at his finding and the High Court was in error in thinking that it did no harm and caused no prejudice. We cannot subscribe to the view of the High Court that the trial should be taken as having been conducted with the aid of the two assessors as sanctioned by section 285, Criminal Procedure Code. That is not what actually happened. It is difficult to convert a trial held partly with the aid of three assessors and partly with the aid of four assessors into one held with the aid of two assessors only. At no stage was the trial held with the aid of two assessors only. The third substituted assessor attended a part of the trial and the added fourth assessor also attended a part of it. None of these two were present throughout. Thus the trial when it concluded was a different trial from the one which was commenced under the provisions of section 284, Criminal Procedure Code. To a situation like this we think section 537 cannot be called in aid. Such a trial is not known to the Code and it seems implicitly prohibited by the provisions of sections 284 and 285. What happened in this case cannot be described as a mere error, omission or irregularity in the course of the trial. It is much more serious, It 983 amounts to holding a trial in violation of the provisions of the Code and goes to the root of the matter and the illegality is of a character that it vitiates the whole proceedings. As observed by their Lordships of the Privy Council in Subramania lyer vs King Emperor( '), disobedience to an express provision as to a mode of trial cannot be regarded as a mere irregularity. In Abdul Rahman vs King Emperor (2), the distinction between cases which fall within the rule of section 537 and those which are outside it was pointed out by Lord Phillimore. There it was said that the distinction between Suubramania Iyer 's case (1) and that case in which there was an irregularity in complying with the provisions of section 360 of the Code was fairly obvious. In Subramania Iyer 's case(1) the procedure adopted was one which the Code positively prohibits and it was possible that it might have worked actual injustice, to the accused but that the error in not reading the statements of witnesses to them was of a different character, and such an omission was not fatal. In Pulukurti Kotayya vs King Emperor(3) their Lordships again examined this question. That was a case where there had been a breach of the provisions of section 162, Criminal Procedure Code, and it was held that in the peculiar circumstances of that case it had not prejudiced the accused and the case therefore fell under section 537 and that the trial was valid notwith standing the breach of section 162. Sir John Beaumont in delivering the decision of the Board made the following observations which bring out the distinction between the two sets of cases: There are, no doubt, authorities in India which lend some support to Mr. Pritt 's contention, and reference may be made to Tirkha vs Nanak (4), in which the court expressed the view that section 537, Criminal Procedure Code, applied only to errors of procedure arising out of mere inadvertence, and not to cases of disregard of, or disobedience to, mandatory provisions of the Code, and to In re Madura Muthu (1) (1901) 28 l.A. 257. (3) (1947) 74 I.A. 65. (2) (1927) 54 I.A. 96. (4) All 475. 984 Vannian(1), in which the view was expressed that any failure to examine the accused under section 342, Criminal Procedure Code, was fatal to the validity of the trial, and could not be cured under section 537. In their Lordships ' opinion, this argument is based on too narrow a view of the operation of section 537. When a trial is conducted in a manner different from that prescribed by the Code [as in Subramania lyer 's case(2)], the trial is bad, and no question of curing an irregularity arises: but if the trial is conducted sub stantially in the manner prescribed by the Code, but some irregularity occurs in the course of such conduct, the irregularity can be cured under section 537, and none the less so because the irregularity involves, as must nearly always be the case, a breach of one or more of the very comprehensive provisions of the Code. The distinction drawn in many of the cases in India between an illegality and an irregularity is one of degree rather than of kind. This view finds support in the decision of their Lordships ' Board in Abdul Rahman vs King Emperor( '), where failure to comply with section 360, Criminal Procedure Code, was held to be cured by sections 535 and 537. The present case falls under section 537, and their Lordships hold the trial valid notwithstanding the breach of section 162. " In our judgment, the trial conducted in the present case was conducted in a manner different from that prescribed by the Code and is bad and no question here arises of curing any irregularity. The Code does not authorize a trial commenced with the aid of three named assessors to be conducted and completed with the aid of four assessors. The substitution of one assessor by another and an addition to the number of assessors appointed at the commencement of the trial is not sanctioned by section 285, Criminal Procedure Code, nor is it authorized by section 284. On the other hand, the language of section 285(l) read with the provisions of section 285(2) implicitly bans the holding of such a trial. It is not possible to say with any degree (1) Mad. 82o. (2) (1901) 28 I.A. 257. (3) (1927) 54 I.A. 96. 985 of certainty to what extent the opinion of the outgoing and the incoming assessors who did not attend the whole of the trial influenced the decision in the case ; but as such a trial is unknown to law, it has to be presumed that it was illegal. Mr. Mehta for the State Government contended that under section 309(2) the opinion of assessors is not binding on the sessions judge and their presence or absence does not affect the constitution of the court and that as at this trial at least two of the assessors originally appointed sat throughout the trial it should be held that the trial was substantially a trial conducted in accordance with the provisions of the Code. The learned counsel did not go to the length of urging that a trial without the aid of any assessors whatever was a good trial under the Code. Such a contention, if raised, would have to be negatived in view of the clear provisions of section 284 and of sub section (2) of section 285. The appointment of at least three assessors is essential for the validity of a trial of this character at its commencement, and once validly commenced,in certain events, it can be validly concluded if at least one of them remains present throughout, while others drop out; but a trial conducted in the manner in which it was done in this case is wholly outside the contemplation of the Code and it is not possible to hold that it was concluded according to the provisions of the Code. The provision in the Code that the opinion of the assessor is not binding on the sessions judge cannot lend support to the contention that the sessions judge is entitled to ignore their very existence. As already pointed out, though he may not be bound to accept their opinions, be is certainly bound to take them into consideration. The weight to be attached to such opinions may well vary with the number of assessors. Mr. Mehta to support his contention placed reliance on the majority decision of the Madras High Court in King Emperor vs Tirumal Reddi (1). In that case the trial continued for about seven weeks. During that (1) Mad. 986 period one of the assessors was permitted to absent himself during two whole days, and five half days respectively, at first, so that he might visit his mother on her death bed, and subsequently, to perform the daily obsequies rendered necessary by her decease. He then resumed his seat as an assessor and continued so to act until the termination of the trial, all the depositions recorded in his absence having been read by him on his return. At the conclusion of the trial the sessions judge invited the opinion of each assessor, and recorded it. The opinion of each was that all the accused were guilty and the judge concurring in that opinion, convicted. the accused. On appeal it was contended that the judge had acted contrary to law in allowing the assessor who had been absent to resume his seat as an assessor and in inviting and taking into consideration his opinion in deciding the case. It was held by the majority of the court that the finding and the sentence appealed against had been passed by a court of competent jurisdiction within the meaning of section 537 of the Code and that the defect in the trial did not affect its validity and was cured by that section as the irregularity had not in fact occasioned a failure of justice. Mr. Justice Davies took a different view. This decision was clearly given on the peculiar facts and circumstances of that case and is no authority in support of the view contended for by Mr. Mehta. For the reasons given above we are constrained to hold that the trial of the appellants conducted in the manner above stated was bad and the appellants have to be retried in accordance with the procedure prescribed by the Code. In the result we allow this appeal, quash tile conviction and sentence passed on the appellants, and direct their retrial by the sessions judge in accordance with the procedure prescribed by the Code. Appeal allowed Retrial ordered.

Section 285 of the Criminal Procedure Code permits a trial commenced with the aid of three assessors to be continued and completed with the aid of less than three if during the course of the trial any assessor is prevented by sufficient cause from attending. It does not, however, authorise the substitution of an assessor for an absent one nor an addition to the number of assessors during the course of the trial. A, B and C were summoned to sit as assessors for a murder trial and as C did not appear, D who was in the list of assessors and who was present in court though not summoned, was asked to sit as an assessor, and the trial commenced with three assessors A:, B and D. A absented himself during the course of, the trial and the judge asked E to sit in place of A and proceeded with the trial for some days with B, D and E. Later on A appeared and the trial continued till the end with the four assessors A, B, D and E: Held, (i) that the mere fact that D who had not been sum moned was allowed to sit as an assessor when the trial commenced did not vitiate the trial as it, was a mere irregularity and did not cause any failure of justice; King Emperor vs Ramsidh Rai approved. Balak Singh vs Emperor (A.I.R. 1918 Pat. 420) explained. (ii)though sub section (1) of section 285 imposes a duty on the judge to find out whether there was sufficient cause for the absence of an assessor and to consider whether it is not possible to enforce his attendance, it should be presumed that he has done so when he proceeds with the trial in his absence and a mere omission to record reasons for proceeding with the trial without the absent assessor would not by itself vitiate the trial ; (iii) a sessions judge, however, has no jurisdiction to substitute another person for any assessor who absents himself during the trial or to reinstate the absent assessor when be reappears and continue the trial with four assessors when the trial commenced with three assessors, and the trial in question was there fore illegal. 126 974 King Emperor vs Tirumal Reddi (I.L.R. distin guished.

Civil Appeal No. 96 of 1961. Appeal by special leave from the award dated December 7, 1959, of the central Government Industrial Tribunal Dhanbad in reference No. 42 of 1959. S.C. Banerjee and P. K. Chatterjee, for the appellant. Janardan Sharma, for the respondent. January 30. The Judgment of the Court was delivered by SARKAR, J. The appellants, the Bhowra Kankanee Coal Co. Ltd., own the Bhowra and other collieries. On the Bhowra Colliery there are a number of residential bungalows belonging to the appellants occupied by their officers employed in the colliery. The appellants employ certain malis for working as such in these bungalows and their duty is to look after and maintain the gardens there. A dispute along between the appellants and their workmen as to whether these malis, who were fourteen in number, were entitled to bonus. By an order made on June 23, 1959, under the , the Government of India referred this dispute along with another with which we are not concerned in this case, for adjudication to the Industrial Tribunal, Dhanbad. The Points referred concerning the dispute above mentioned were in these terms: (1) Whether the withdrawal of the benefit of bonus provided in the Coal Mines Bonus 885 Scheme by the management of the Bhowra Colliery from the following garden mazdoor/malis is justified. If not, to what relief are they entitled and from what date? (2) Whether the garden mazdoors/malis referred to above are employed on domestic and personal work within the meaning of paragraph 3 (b) of the Coal Mines bonus Scheme, 1948 and if not, to what relief are they entitled and from what dates The points so referred were decided by the Tribunal against the appellants by an award made on December 7, 1959, and the present appeal is against that award. Till January 1, 1955, the Bhowra and certain other collieries managed as a group, were owned by the Eastern Coal Company Ltd., and on that date these collieries were sold to the appellants. At the time when this sale was being arranged, the workmen in these collieries raised a dispute that their services should be treated as continuous inspite of the transfer of the collieries from one owner to another by the sale and that the conditions of their service and the facilities which they were enjoying under the previous owners should be guaranteed and continued by the succeeding owners, that is the appellants, after the latter took over the collieries. At the instance of the conciliation officer appointed under the Act this dispute was settled by an agreement made on January 14, 1955, to which the Conciliation officer the workmen the previous owners and the appellants were parties. Paragraph 3 of this agreement provided as follows: "Agreed that the existing service conditions and the facilities will be continued, excepting pension." Now in 1948 an Act called the Coal Mines Provident Fund and Bonus Schemes Act had been passed by section 5 of which the Central Government was 886 empowered to frame a bonus scheme for the payment of bonus to the employees of coal mines, The Central Government had framed a Bonus Scheme under this provision in 1948 and since then the previous owners had been paying the malis employed for the bungalow gardens belonging to the Bhowra Colliery, bonus in terms of it. In 1951 they once stopped the bonus but that caused an industrial dispute and they thereupon restored the bonus. Upto the acquisition of the Bhowra Colliery by the appellants they position thus was that these malis had been receiving bonus since 1948 excepting for a short period during which it had been stopped as earlier mentioned. After they became the owners of the Bhowra Colliery, the appellants however stopped the payment of bonus to these malis. This raised the industrial dispute which had led to this appeal. Paragraph 3 of the Bonus Scheme framed under the Act, so far as relevant for this case, is in these terms: Paragraph 3. Except as hereinafter provided every employee in a coal mine to which this Scheme applies shall be eligible to qualify for a bonus, Exceptions: An employee in a coal mine shall not be entitled to a bonus under the Scheme for the period during which (a) . . . . . . . . (b) he is employed as a mali, sweeper or demestic servant on demestic and personal work; (c) . . . . . . . . One of the questions raised in this appeal is whether the bungalow malis were entitled to bonus under this paragraph. The appellants contended before the Tribunal that malis as a class were excepted from the benefit of the Bonus Scheme by the provision 887 in exception (b) in this paragraph. They further contended in the alternative that these malis were excepted in any event because they were In malis employed on domestic and personal work within the meaning of the exception. The Tribunal rejected these contentions of the appellants and held (a) that these malis were entitled to bonus under paragraph 3 of the agreement of January 14, 1955 and (b) that they were not employed on domestic and personal work and were therefore not within the exception. For these reasons the Tribunal held that the withdrawal of the bonus by the appellants was not justified. It is not clear on what ground the Tribunal held that the malis were entitled to bonus under paragraph 3. of the agreement of January 14, 1955. It may be that the Tribunal thought that the Bonus Scheme framed by the Central Government formed a condition of service of the malis or a facility to which they were entitled and which the appellants undertook by the agreement of January 14, 1955, to continue. If this was the point of view, then of course the further question still remains whether the malis were on domestic and personal work for if they were, then they would not be entitled to the bonus as a facility or a condition of their service under the Scheme. It was however contended on behalf of the respondent workmen in this Court that the right to bonus was a condition of the service of the malis and a facility to which they were entitled independently of the Bonus Scheme and that this is what the Tribunal had held. The record however is not very clear on this question. The appellants dispute the contention of the workmen and further say that in any event the Tribunal had no jurisdiction to decide that question for the question referred to it was the right of the malis to bonus under the Bonus Scheme. 888 We think that the appellants ' contention is well founded. What had been referred was the question "whether the withdrawal of the benefit of bonus Provided in the Coal Mines Bonus Scheme . is justified". On the language of the order of reference it seems to us that the dispute referred was as to the right as provided in the Bonus Scheme and not as to any other right. This also was the workmen 's case before the Tribunal as appears from its written statement filed there. In the statement of case filed in this appeal also, the respondent took the same position. We therefore think that if the Tribunal had held that the malis were entitled to the bonus under the agreement of January 14, 1955 independently of the Bonus Scheme it had exceeded its jurisdiction and its award cannot be upheld. The question still remains as to whether on a proper construction of paragraph 3 of the Bonus Scheme these malis had any right to bonus. That was undubitably the question referred to the Tribunal. The words requiring construction are "on domestic and personal work". The Tribunal held that malis working in bungalows belonging to the appellants were not working for the home or household of private persons or individuals and were therefore not on domestic work. It also held that as the malis work under the direction and control of the appellants and were liable to be transferred from one bungalow to another or to some other work they were not on personal work. We are unable to accept this construction of paragraph 3 of the Bonus Scheme. Domestic means as of the home. We feel no doubt that the malis who were working in the bungalows occupied by the officers were working in the home of the officers. They were, therefore, on domestic work. The work they were doing would not cease to be domestic work because the bungalows belonged not to the officers but to the appellants. Whether a work 889 is domestic or not would depend on its nature. Suppose an officer has employed his own mali for working in the bungalow garden, that mali would surely be on domestic work. This is not disputed. The nature of that work would not change because the the mali was working not under the orders of the officer occupying the bungalow but under the appellants, nor because the bungalow did not belong to the officer but to the appellants. Nor for the same reason does the fact that the malis were employed by the appellants and not by the officers make any differences The fact that Malis might be transferred to other jobs and cease to be malis altogether is also irrelevant. On such transfer they might become entitled to bonus. The exception in paragraph 3 deprives them of the bonus only for the time they are malis on domestic and personal work. Paragraph 3, of the Bonus Scheme contemplated malis who were employees of the colliery owners and were yet on domestic work. The Tribunal thought that paragraph 3 only contemplated cases of malis appointed by the officers who were paid some allowance by the colliery owners for keeping malis in the gardens of the bungalows occupied by them. It may be that malis to engaged would be the employees of the colliery owners, as the term employee is defined in the Act under which the Bonus Scheme was framed, but we see no reason to restrict malis on domestic work referred to in paragraph 3 to such malis only. As we have said earlier, whether a malis on domestic work or not would depend on the nature of the work. As the work which the malis with whom we are concerned did, was domestic work. these malis must be deemed to be within the exception mentioned in paragraph 3. They would not cease to be malis on domestic work because they had been working in the bungalows belonging to the appellants or were under their control and orders. We further feel no difficulty in holding that 890 these malis were on personal work. The word "personal" is obviously used in the sence of work for an individual as distinguished from work for the Coal mine as an institution. These malis were undoubtedly working for the officers as individuals. Therefore they were on personal work. For these reasons in our view the malis in the present case were not entitled to any bonus under the Bonus Scheme. As in our opinion the order of reference does not raise any question as to whether the malis were entitled to bonus apart from the Bonus Scheme, it is unnecessary for us to express any opinion on that question and we do not do so. The result is that this appeal allowed and we set aside the award of the Tribunal in so far as it is concerned with the two points of dispute earlier set out which had been referred to it. We do not think it a fit case to make any order for costs. Appeal allowed.

In exercise of the power conferred by 5. 5 of the Coal Mines Provident Fund and Bonus Schemes Act, 1948, the Central Government framed a Bonus Scheme for the payment of bonus to employees of coal mines. Paragraph 3 of the scheme made every employee in a coal mine eligible for a bonus except, infer alia, "a mali on domestic and personal work". The question for consideration was whether under this paragraph the malis working in the officers ' bungalows had any right to bonus. ^ Held, that these malis were not entitled to any bonus under the Bonus Scheme. Paragraph 3 contemplated malis who were employees of the colliery owners and were yet on domestic work. Domestic meant as of the home. The malis 884 who were working in the bungalows occupied by the officers, were working in the homes of the officers. They were therefore, on domestic work. The work they were doing did not cease to be domestic work because the bungalows belonged not to the officers but to the appellant or because they were under the control and orders of the appellant. Further, these malis were on personal work. The word "personal" was used in the sense of work for an individual as distinguished from work for the coal mine as an institution. These malis were undoubtedly working for the officers as individuals.

Civil Appeals. Nos. 89, 90 and 126 to 128/61. Appeals from the judgment and order dated November 8, 1957, of the Kerala High Court in o. Ps. Nos. 70 and 71 of 1956(K) and 2, 6 and 7 of 1955 E. M.C. Setalvad, Attorney General of India and R. Gopalakrishnan, for the appellants in a. As, Nos. 89 and 90 of 61. G. section Pathak and V, A. Seyid Muhammad, for the respondent in C. As. Nos. 89 and 90 of 61. A. V. Viswanatha Sastri, A. George Titus, R. Mahalingier and M. R. Krishna Pillai, for the appellants in C. As. 126 to 128 of 61. G. section Pathak and Sardar Bahadur, for the respondents in a. As, Nos, 126 to 128 of 1961. 744 1962. January ` 24. The Judgment of B. P. Sinha, C. J., P. B. Gajendragadkar, K. N. Wanchoo and M. Hidayatullah, JJ., Was delivered by Wanchoo, J, J. C. Shah, J., delivered a separate judgement. WANCHOO, J. These five appeals on certificates granted by the High Court of Kerala raise a common question of law and will be dealt with together. Two of them (appeals 89 and 90) are from what was formerly the Cochin area and the other three are from what was the Travancore area. They relate to a tax on tobacco in these areas. As the facts, laws and rules in the two areas are similar we propose to deal in detail with the appeals from the Cochin area. In 1909, Act VII of 1084 was passed by the Maharaja of Cochin to consolidate and amend the law relating to tobacco and was called the Cochin Tobacco Act, VII of 1084 (hereinafter called the Cochin Act). Section 4 of the Cochin Act prohibited the possession for sale, transport, import or export, sale and cultivation of tobacco except as permitted under the Act or the rules framed thereunder. section 5 of the Act gave power to the Diwan to make rules from time to time consistent with the Act to permit. absolutely or subject to any conditions, and also to regulate the possession for sale, transport, import or export, sale and cultivation of tobacco as well as the form of duty leviable on the sale of tobacco by retail. The remaining provision of the Act deal with offences, prosecutions punishment, confiscation and other ancillary matters such as arrest and siezure, with which we are not concerned in the present appeals. Reference may however be made to section 18 which provided that "no action shall lie against the sirkar or against any officer of the Excise department for damages in any civil court for any act bona fide done or ordered to be done in pursuance of this Act, or of any law for 745 the time being in force relating to tobacco revenue. Rules were framed under the Cochin Act called the Tobacco Cultivation Rules, which, by the first rule provided that "the cultivation of tobacco plant is prohibited except under a licence and shall be restricted to such parts or localities of the State, as may, from time to time, be fixed by the Diwan. . " Rule 3 provided for drying, curing, manufacturing and storing of the tobacco, cultivated in the State, to be done under the supervision of an officer of the Excise Department in licensed manufacturing yards and storehouses. Rule 4 provided for licensed for manufacturing yards and store houses. Rule 5 laid down that the licences would be in force for one official year and were to be issued on payment of a fee of Rs. 50/ for each licence, Under r. 6, the tobacco crop could only be harvested after permission obtained from the Inspector of Excise and under r.7 the harvesting was to be done by the licensed cultivator under the general superintendence of the Sub Inspector. Of the locality in which the area cultivated lay and the harvested corp was to be transported only under permits granted by him from such area to the manufacturing yard where alone manufacture was to be undertaken. Rule 8 provided for the maintenance of a stock book by a licensee of a storehouse or n manufacturing yard. Rule 13 provided that the licensed manufacturer and the storehouse keeper would sell or otherwise dispose of his stock only to licensed dealers and there was prohibition against the disposal or sale of tobacco to any person who had not the required license to possess the same. Rule 15 made it an office for any one to cultivate, dry, cure, manufacture, store, transport, sell or otherwise dispose of tobacco in contravention of the Rules. In addition to these Rules, there were further Rules also framed under the Cochin Act with, 746 respect to import of tobacco into the State, and all import was prohibited except under the provisions of the Diwan 's notification describing the sale of tobacco shops and licences. Possession of tobacco for the purpose of sale was also prohibited except under the provisions for the sale of tobacco shops and licences. Export of tobacco was also prohibited except with the special sanction of the Commissioner of Excise. It further appears that the system in force for the collection of tobacco revenue up to August 1950 was to auction what were called A class and B class shops and the last of such auction was held under the notification dated May 30, 1919. In addition there were a class shops, the licence for which was granted either on the recommendation or in consultation with class licensees at the discretion of the Excise Commissioner or any other officer authorised by him on payment of the prescribed fee. This system along with the Rules already referred to was in force on April 1, 1950. On April 1, 1950, after the Constitution had come into force and Travancore Cochin has become a Part State thereunder, the Finance Act, No. XXV of 1950, extended the , No.1 of 1944 (hereinafter called the Central Act), to the Part State of Travancore Cochin by section 11 thereof. Section 13 (2) of the Finance Act, further provided that "if immediately before the 1st day of April, 1950, there is in force in any State other than Jammu and Kashmir a law corresponding to, but other than, an Act referred to in sub section (1) or (2) of section 11, such law is hereby repealed with effect from the said date. " It seems that in consequence of this provision in the Finance Act, 1950, the rules which were in force on April l, 1950, were changed in the Cochin area by a notification dated August 3, 1950, and the system of auction sales of A clause and shops was done away with and instead 747 graded licence fees were introduced for various classes of licensees, including class licensees. Similar change was made for the Travancore area by notification dated January 25, 1951. These Rules introduced by these two notifications also did away with the control of cultivation, drying, curing, manufacturing and wrare housing which were in force under the earlier Rules, so that these new Rules were only concerned with licensing of A, and C class shops. A class licensees under the new Rules were called stockists, class licensees were wholesale sellers and a class licensees were retailers. The system for A class licensees was that they were to pay a minimum annual fee for a Maximum quantity of tobacco or tobacco goods possessed by them and additional fee for further additional quantity, Thus, for example, in the case of jaffra tobacco it was provided that maximum annual fee would be Rs.1,500/ for a minimum of 100 candies and further fee of Rs.1,000 for additional quantity of 100 candies or part there of. The appellants of Cochin area were tobacco dealers and holders at the time they filed their petitions in 1956 of A class licences. The main contention raised on their behalf in their petitions was that the Cochin Act stood repealed by the Finance Act 1950, on the introduction of the Central Act in the part State of Travancore Cochin from April 1, 1950 in consequence, the notification which was issued on August 3, 1950, or on January 25, 1951, framing new Rules for the issue of licences and prescribing rules therefor under the powers conferred under the Cochin Act or the similar Travancore Act were ab initio void, because the Acts under which the notifications were; purported to be issued stood repealed from April 1, 1950. In addition various other grounds were raised challenging the validity of the new Rules which, however, we do not think it necessary for the purposes of these appeals to set out here, 748 The petitions were opposed on behalf of the State and it was contended that the Cochin Act or the similar Travancore Act did not stand repealed from April 1, 1950, In consequence it was urged that the State was competent to frame new Rules which it did under the Cochin Act or the similar Travancore Act. Further the case of the State was that the graded licence fee introduced after April 1, , was a tax which was sustainable under item 60 or 62 of List II of the Seventh Schedule to the constitution. The High Court dismissed the petitions holding that the laws under which the new Rules were framed were in force and were justifiable under item 62 of List II of the Seventh Schedule. Unfortunately, though the judgment of the High court mentions the contention of the appellants that on the extension of the Central Act with effect from April 1, 1950, by the Finance Act, 1950, the Cochin Act as well as the similar Travancore Act ceased to be operative from that date, there is no discussion in the judgment with regard to this contention, and the High Court did not consider whether in view of s.13(2) of the Finance Act, 1950, the Cochin Act as well as the similar Travancore Act stood repealed from April 1, 1950. If the effect of section 13(2) of the Finance Act, 1950, was to repeal the Cochin Act as well as the similar Travancore Act, from April 1, 1950, there will be no law in operation which would justify the framing of the new Rules either in August 1950 or`in January 1951 and it would then be unnecessary to consider whether a law contain in,as provisions similar to those contained in the notification would be within the competence of the State legislature under item 62 of` List ll of the Seventh Schedule. That question would only arise if the Cochin Act or the similar Travancore Act survived the repeal effected by section 13(2) of the Finance Act. 749 We have therefore to see what the provisions of the Finance Act are in this Connection. As already indicated, B. 11(1) of the Finance Act extends the Central Act and the Rules and orders made thereunder which were in force immediately after the commencement of the Finance Act to all Part States, except the State of Jammu and Kashmir. Consequently, the Central Act as well as the Rules and orders made there under become applicable to the Part State of Travancore Cochin from April l, 1950. Further section 13(2) of the Finance Act specifically provides that from April 1, 1950, any law corresponding to the Central Act will be repealed from that date. The contention on behalf of the appellants is that the Cochin Act as well as the similar Travancore Act was a law corresponding to the Central Act and therefore stood repealed as from April 1, 1950, under B. 13(2) of the Act. and it is this contention that we have to examine. It was pointed out by this Court in The Custodian of Evacuee Property vs Khan Saheb Abdul Shakoor, etc. (1) that where the Act repealed provides substantially for all matters contained in the Act effecting the repeal there is correspondence between the two Acts and the earlier Act would thus stand repealed; it is not necessary that there should be complete identity between the repealing Act and the Act repealed in every respect, Therefore, when section 13 (2) of the Finance Act provides that on the extension of the Central Act from April 1, 1950, to the Part State of Travancore Cochin, any law corresponding to the Central Act is repealed with effect from that date, all that we have to see whether the law repealed substantially provided for the same matters as the Central Act, even though it may not be identical in all respects. Let us therefore turn to the Cochin Act and the rules framed thereunder to see if it substantially 750 provides for the same matters with which the Central Act and the Rules and Orders made thereunder deal. The main contention on behalf of the respondent in this connection is that the Central Act is an Act imposing a duty of excise on tobacco under item 45 of List I of the Seventh Schedule to the Government of India Act, 1935 (now corresponding to item 84 of List I of the Seventh Schedule to . the constitution), and such duty of excise is a duty on goods manufactured or produced in India. Thus according to the respondent, the main feature of the Central Act is the imposition of a tax on goods produced or manufactured in India and unless the Cochin Act or the similar Travancore. Act also imposes a tax on goods produced or manufactured in what was formerly Cochin or Travancore State these would be no question of correspondence between the Central Act and the Cochin Act or the similar Travancore Act. Reference was also made to In Re the Central Provinces and Berar Sales of Motor Spirit and Lubricants Taxation Act. 1938 Central Provinces and Berar Act XIV of 1938) Province of Madras v Messrs. Boddu Paidanna and Son(2) and Governor General in Council vs Provinces of Madras (3), where the nature of a duty of excise was considered. In the first case it was held that the primary meaning of "excise duty" was of a tax on articles produced or manufactured in the taxing country (see p. 40). It was also observed in that case that it could not be denied that laws were to be found which impose a duty of excise at stages subsequent to the manufactures or production. In the second case it was held that duties of excise were duties levied on the manufacture or producer of the commodity taxed. In the third case, the Privy council approved of the view of the Federal Court as to the nature of the duty of excise. It may therefore be accepted that a duty of excise is a 751 tax on goods produced or manufactured in the taking country. It may also be accepted that generally speaking the tax is on the manufacturer or the producer,. though it cannot be denied that laws are to be found which impose a duty of excise at stages subsequent to the manufacture or production. We cannot however forget that the Cochin Act or the similar Travancore Act was passed by State in which there were no such Constitutional provisions as are to be found in the Government of India Act and it legislative Lists and this aspect will have to be borne in mind when judging the question of correspondence between the Central Act and the Cochin Act or the similar Travancore Act. Now the Central Act provides by section 3 for the levy and collection of duties of excise on all excisable goods other than salt which are produced or manufactured in India and also a duty on salt manufactured in or imported by land into any part of India. Further section 6 of the central Act gives power to the central Government to issue licences and prohibits any person from engaging in the wholesale purchase or also whether on his own account or as a broker or commission agent or the storage of any excisable goods except under the authority and in accordance with the terms and conditions of a licence granted under the Central Act. In Chaturbhai. M. Patel vs The Union of India (1) where the various provisions of the Central Act (including section 6) and the rules framed thereunder were attacked on the ground that they had nothing to do with the levy and collection of duties of excise, this court held that the various provisions of the Central Act and the Rules made thereunder were essentially Connected with levying and collection of excise duty and in its true nature and character the Central Act remained one under item 45 of List I and that the incidental trenching upon the provincial field would not affect its constitutionality. The nature of the Rules the 752 considered will appear from the following observations at p. 371: "It (the Central Act) is a fiscal measure to levy and realise duty on tobacco. The method of realising duty must be left to the wisdom of the legislature taking each individual trade and its peculiarities and difficulties which arise in that matter. Various provisions of the Act and the Rules show that the authorities are on the track of the movement of tobacco from the time it is grown to the time it is manufactured and sold in the market and the various provisions of the Act and the Rules made thereunder have been considered necessary for effectuating the purpose of the Act. " It is true that the Central Act provides for the levy of excise duty under section 3 but in order to carry out that purpose it has provided for licences under section 6. The Rules also provide in Chap. III for levy and refund of duty, in Chap. V for manufactured goods other than salt, in Chap. VII for warehousing, in Chap. VIII for licensing. Thus in order to levy excise duty under the Central Act, there are provisions in the Rules which start in the case of tobacco from the stage of cultivation and continue right up to the time the finished product reaches the hand of the retailer and thus becomes a part of the commons stock for purposes of sale to the consumers. We have also seen that the Cochin Act similarly provides for control on tobacco from the stage at which it is grows to the stage till`it reaches Glass licensees who sell it in retail to the consumers. The Cochin Rules may not be so detailed as the Rules under the Central Act but their main object and purpose is the same, namely, to keep a check on tobacco from the time it is grown to the time it reaches the a Glass licensee who eventually sells it to the consumer. Further if one looks at the Rules 753 under the similar Travancore Act in vol. II of the Travancore Excise Manual which were in force on A April 1, 1950, in relation to tobacco it will be found that there are elaborate rules in Part III from pp. 257 to 325 dealing with all aspects of control relating to tobacco. IV deals with bonding and issue; Chap. V with licences for sales, Chap. VI with transport and possession. Further there are rules at p. 296 for cultivation, curing and warehousing. Then at p. 14 are rules for the manufacture of cigars, cheroots and snuff in bond. It will thus be clear r that the Cochin as well as the Travancore Rules provided for similar central of tobacco as under the Central Act and show that the authorities in Travancore and Cochin were also on the track of the movement of tobacco from the time it was grown and manufactured to the time it was sold in the market. It would therefore follow that the Cochin Act as well as the similar Travancore Act along with the Rules corresponded to the Central Act substantially and would thus be repealed by section 13(2) of the Finance Act, 1950. But it is urged on behalf of the State that there is no provision for charging duty in the Cochin Act or the similar Travancore Act and therefore all these provisions in the Rules for control from the time of cultivation to the time of the final stage of sale to the consumer, even though they are similar to the Rules under the Central Act, would not make the Cochin Act or the similar Travancore Act a corresponding Act to the Central Act. There is no doubt that there is no provision corresponding to section 3 of the Central Act in the Cochin Act or in the similar Travancore Act. Under the Cochin Act the tax was levied by virtue of the power conferred on the Diwan under section 5 to make rules for the purpose. Under the similar Travancore Act, the provision is contained in section 31 which provides that the Diwan may with the sanction of the ruler make rules permitting 754 absolutely or subject to the payment of any duty or fee or to any other conditions, and regulating within the whole or any specified part of Travancore, the cultivation, manufacture, possession, transport, import and sale of tobacco. So in both the former States, the Act did not contain a charging section and the duty was levied by the Rules framed by the Diwan under the powers conferred on him by the Act. In essence, therefore, the provision for charging the tax was made in the Rules. Further it is true that the method by which the tobacco revenue was realised was through auction sales of the right to possess and sell tobacco. But we must not forget that the Cochin Act as well as the similar Travancore Act was passed by a Ruler who was not trammelled by a constitution like the Government of India Act, 1935, and its Legislative Lists. The method evolved for realising tobacco revenue was to auction the right to poses and sell tobacco and the amounts received at such auctions would cover what would be duty under section 3 of the Central Act and licence fee under section 6 thereof. It is urged however that this does not amount to duty on goods produced, nor is the duty in such a case paid by the manufacturer or producer of the goods. We have already indicated that the essence of the duty of excise as held by the Federal Court and the Privy Council is that it is a duty on the goods manufactured or produced in the taxing country. Further as generally the duty is on the goods produced or manufactured it is paid by the producer or manufacturer, though as in the case of all indirect taxes it is passed on eventually to the consumer in the shape of being included in the price and is thus really borne by the consumer. Further the cases on which reliance bas been placed on behalf of the State also show that laws are to be found which impose duty of excise at stages subsequent to manufacture or 755 production. As a matter of fact, even in British India before 1935 there used to be public auctions of the right to possess and sell excisable goods like country liquor, ganja and bhang aid the amount realised was excise revenue. It is also obvious that this system of auction is not a system of levying sales tax because it has nothing to do with the levy on each sale, which is the essence of a sales tax. It seems that in the former States of Travancore and Cochin, auction system continued right up to the time the constitution came into force and even for sometime thereafter. It seems under the circumstances that the auction system which was in force was only a method of realising duty through the grant of licences to those who made the highest bid at the auctions. The fact therefore that this system was used instead of the system of charging of duty as provided in section 3 of the Central Act would not in our opinion make any difference to the nature of the impost which was in force on the relevant date, namely, April 1, 1950. It was however urged that under this system even tobacco which was not produced or manufactured in the State but was imported from outside was included for the purpose of licences granted under it. That is undoubtedly so. But from the Rules which were in force regarding cultivation, curing, manufacturing and so on of tobacco within the State it would not be unreasonable to infer that the substantial part of the income from auctions was still in the nature of excise duty. Even in the case of imported tobacco, only with respect to that part of it which was eventually sold to the consumer as it was imported without any processing or treatment in the State, it can be said that the impost which fell on it was not in the nature of excise duty. However, there is no way of differentiating this part of the revenue from the rest and considering the elaborate provisions as to the control of tobacco trade from the grower right up to the time that the 756 goods were sold to the public in retail sale it would r in our opinion be not unreasonable to hold that the Cochin Act as well as the Travancore Act was in substance an Act corresponding to the Central Act. Therefore when the Central Act was extended to the Part State of Travancore Cochin by section 11 (1) of the Finance Act and the Finance Act specifically provided by section 13 (2) for the repeal of corresponding law, the result was that the Cochin Act as well as the similar Travancore Act stood repealed. There would be no power in the State Government thereafter to frame new Rules either in August 1950 or in January 1951 for there would be no law to support the new Rules and without such law the new Rules could not impose a tax as that would clearly offend article 265 of the Constitution. Further as soon as the Cochin Act as well as the similar Travancore Act stood repealed on April 1, 1950, by virtue of a 13(2) of the Finance Act there could be no question of their being sustained under item 62 of List II of the Seventh Schedule for that would only arise if these were not repealed as corresponding law by s.13(2). Turning now to the three Travancore appeals it is enough to pay that they stand on the same footing as the two Cochin appeals. If anything the Travancore Act as well as the Travancore Rules which were in force on April 1, 1950 are more elaborate than the Cochin Act and the Cochin Rules. Further the Travancore Act by section 31 actually refers to manufacture also. The Cochin Act did not refer to manufacture in the Act itself though there was provision for manufacture in the Rules framed under the Act. What applies therefore to the Cochin Act and the Rules framed thereunder applies in force to the Travancore Act and the Rules framed thereunder and there is no doubt that the Travancore Act and the Rules framed thereunder were also a law corresponding to the Central Act and the Rules framed thereunder. The Travancore Act therefore also stood repealed from April 1, 1950. There 757 would thus be no law to support the Rules framed by the State Government in January 1951 and, therefore the Rules must fall. It appears that these new Rules have been abrogated as from January 1958. So it Was urged on behalf of the State that this Court should not grant a mere declaration as to the invalidity of the Rules when they are no longer in existence. This argument in our opinion has no force because we must look to the situation as it was when the petitions were presented. The Cochin petitions were presented in 1956 and the Travancore petitions were presented in 1955 and at that time the Rules were in force and they continued in force till December 1957. Therefore the petitioners would be entitled to a declaration that the Rules were invalid because at any rate that would give them relief so far as the period after their petitions is concerned while the Rules remained in force. We therefore allow the appeals and set aside the order of the High Court. The petitions are allowed and it is hereby declared that the new Rules purporting to be framed either under the cochin Act or under the Travancore Act in August 1960 and thereafter in January 1951 were invalid ab initio and have no force and effect. The appellants will get their costs from the State one set of hearing costs. SHAH, J. In this group of five appeals the principal question which falls to be determined is whether within the meaning of a 1:3(2) of the Finance Act, 1950 (which by section 11 thereof extended the Central Excise & Salt Act, I of 1944, to the Part b States), there was, immediately before the 1st of April 1950, in force in Part State of Travancore Cochin, a law Corresponding to the Central Excise & Salt Act, 1944 It is common ground that if there was such a law in force, by virtue of s.13(2) of the Finance Act of 1950, that law stood repealed, 758 The appellants in Civil Appeals Nos.89 and 90 of 1961 were carrying of the former state of Cochin. Appellants in Civil Appeals 126 to 128 of 1961 were residents of and carried on business in tobacco with in territory of the former State of Travancore. On July 1, 1949 the States of Travancore and Cochin from themselves into a Union under a common administration, but by the virtue of Travancore Cochin Administration Law ,6 of 1125 (M.E.), the Acts which were previously in force. In the Territory of the former State of Travancore , there was in force the Travancore Tobacco Regulation I of Travancore in 1911. By section 3 of the Act,"Tobacco" was define as including "snuff, cigars cigarettes, beedies, tobacco powder and other preparations or admixtures of tobacco" Section 4 of the Act imposed excepts as permitted by the Act or by any other enactment relating to tobacco for the time being in force by the Rules published under the Act or any other such enactment prohibitions against cultivation, manufacture possessions transport, importation exportation or sale of tobacco. By Chapter III of the Act power was conferred upon the officers of the Excise Department to search house suspected to contain tobacco and provision was made for incidental matters. Chapter IV dealt with offences and punishments and by section 31 the Diwan of the State was authorised, with the sanction of the Ruler, from time to time, by Notification in Gazette to make rules consistent with the Act amongst other subject permitting absolutely or subject to the payment of any duty or fee or to any other conditions and regulating within the whole or to any other conditions and regulating within the whole or any specified part of the State of Travancore, cultivation manufacture possession transportation 759 import and sale of tobacco; authorising the establishment of warehouses or bankshalls for storing tobacco legally cultivated or imported into the territory fixing the mode, time and place of levy T of duty, regulating the special custody of tobacco warehoused and the levy of fees for warehousing and transport, and generally to carry out the provisions of the Act. Rules were framed in 1913 in exercise of the powers under section 31 of the Tobacco Act whereby restrictions were imposed upon the import and export of tobacco and provision was made for bonding tobacco in warehouses and for the issue of licences for bonding tobacco. Provision was also made for licensing retail sale for tobacco and for transport and possession thereof. Certain other rules regulating cultivation, curing and warehousing tobacco and for the issue of licences for those purposes were promulgated in 1937. Rules were also framed regulating the manufacture of cigars, cigarettes and cheroots in bonds under licences. It is unnecessary to set out these rules in detail, it may suffice to observe that cultivation, curing, manufacture, possession, transport, importation and exportation and sale of tobacco was controlled by a system of licensing. Certain licences were issued free of charge and in respect of certain other licences, especially storage and sale, fee had to be paid to the State. Similarly, in the State of Cochin there was enacted by the Ruler of Cochin the Cochin Tobacco Act of 1084 (M.E.) on May 3, 1909. By section 3(d) of that Act, tobacco was defined as inclusive of "snuff, cigars and preparations of which tobacco forms a part " By section 4, except as permitted by the Act or by the Rules made thereunder, possession for the purposes of sale, transport, import, export, sale and cultivation of tobacco were prohibited. By a 5, the Diwan of the State was authorised from time to time after previous publication, to make rules consistent with the Act to permit abso. 760 lutely or subject to any Conditions regulating the possession, transportation, importation or exportation and sale and cultivation of tobacco. Contravention of the Act and the Rules or orders made under the Ace were penalised by section 6. Rules were framed in 1923 under the Cochin Tobacco Act providing for a system of licensing for cultivation, manufacture and storage of tobacco and for incidental matters. Control was maintained over harvesting, weighment, storage, stock taking and transport of tobacco, and also on the export and import of tobacco. The authorities administering the provisions of the Tobacco Act and the Rules framed thereunder were the Commissioner of Excise and officers subordinate to him in the Excise Department. Licences for storage were to be annual licences and to be issued on payment of licence fee. Under the Cochin Act and the Rules framed thereunder control was maintained on tobacco at all the stages of its production, manufacture and disposal. From a resume ', of the provisions of these two Acts and rules and notifications issued thereunder, it is manifest that on the production, manufacture storage and sale of tobacco control was imposed and the administration of this control was left in the hands of the Excise Departments of the two States. As stated hereinbefore, by virtue of Act VI of 1125 (M.E.), the two Acts in operation within the territories of the two States were continued even after the Union of Travancore and Cochin as formed, and by article 372 of the constitution the provisions of the two Acts remained in operation in the respective area of the former States even after the Part`B State of Travancore Cochin came into being on January 26, 1950. By s.11 of Finance Act 25 of 1950 certain Acts including the Central Excises & Salt Act, 1 of 1944, and all Rules and orders made thereunder in force from time to time before the commencement of the 761 Finance Act were extended with effect from April 1, 1950, to the part B States (except the State of Jammu & Kashmir), It was provided by section 13(2) "that if immediately before the 1st of April, 1950, there was in force in any State other than Jammu & Kashmir a law corresponding to but other than the Act referred to in sub section (1) section 11 such law" shall stand repealed with effect from the said date. Presumably, on account of the application of the Central Excises & Salt Act, I of 1944, by section 11 of the Finance Act, 1950, the Part B State of Travancore Cochin published fresh sets of Tobacco Rules. These Rules were issued on January 25, 1951, in purported exercise of the powers conferred by the Travancore Regulation I of 1087 (M.E.) and the Cochin Tobacco Act of 1084 (M.E.). Rule 14 (which is common to both the sets of Rules) provides that "the vend of tobacco of all kinds is prohibited throughout the state, except under a licence". Rule 15 provides that the "licence for the vend of tobacco shall be of the following description: (i) Stockist or 'A ' Class licence; (ii) Wholesale or 'B ' Class licence ; and (iii)Retail or 'C ' Class licence." Rule 16(i) and (ii) provides: "(i) Holders of Stockist or 'A ' Class licences shall be entitled to purchase tobacco from any dealer within or without the State without any quantitative restriction. This class of licensees shall sell only to other 'A ' Class licensees or to 'B ' Class licence, (ii) The annual fees for these licences shall be as follows: (Then follows a table which sets out minimum fee prescribed for varieties of tobacco stocked upto the maximum 762 prescribed quantity and the additional fee payable for stocking additional quantities.)" The appellants in all these appeals were 'A ' Class stockists and were called upon to pay licence fee prescribed by these Rules. They claimed that they were not liable to pay licence fee under the Rules framed in 1951 because there was absolute delegation of legislative power by the Rules, that the levy infringed their fundamental rights under articles 14 and 19(1)(g) of the Constitution, that the duty levied was in any event an excise duty, and because the fee represented a tax on trade, calling or employment and on that account was subject to the constitutional restriction imposed by article 276 (2) of the Constitution. They also contended that the Tobacco Acts of the Travancore State and the Cochin State, which had been kept alive by Act 6 of 1125 (M.E.) and by article 372 of the Constitution were superseded by the application of the , by section 11 of the Finance Act, 1950. The High Court of Travancore Cochin in the petitions for writs of mandamus and other writs negatived the contentions raised by the appellants that the Acts and the Rules amounted absolute delegation of legislative power or that the fundamental rights under articles 14 and 19(1)(g) and the restrictions imposed by article 276(2) of the Constitution were infringed thereby. The High Court also held that the duty levied was not an excise duty and presumably on that account declined to consider the question whether the Tobacco Acts of the States of Travancore and Cochin had been superseded either wholly of partially by the application of the of 1944. The Travancore and the Cochin Acts do not directly levy any duty on production or manufacture of tobacco. Restrictions, it is true, are imposed 763 the growing, curing, manufacture, storage, import and export by requiring that licences shall be obtained for those purposes and prescribing penalties for violating the provisions of the Acts and the Rules. It also appears that the trade in tobacco was regulated before the formation of the B State of Travancore Cochin, by holding auctions for the rights to sell tobacco. These auctions were held by Excise Commissioners and the highest bidder in the auction got the right to deal in tobacco, and the two Acts were enacted for regulating and controlling the sale of tobacco, but the State did not levy any duty on the manufacture or production of tobacco. The licence fee for the issue of a licence for growing, curing, manufacturing, exporting, importing or storing is not in itself an excise duty on the manufacture or production. The Federal Court In the matter of the Central Provinces and Berar Sales of Motor Spirit and lubricants Taxation Act, 1938 observed: . . at the date of the Constitution Act (Government of India Act 1935) though it seems that the word 'excise ' was not infrequently for the administration of a particular indirect tax (as salt excise or opium excise), the only kind of excise duties which were known in India by that name were duties collected from manufacturers or producers, and usually payable on the issue of the excisable articles from the place of manufacture or production. This also may not be conclusive in itself, but it seems a not unreasonable inference that Parliament intended the expression 'duties of excise ' in the Constitution Act to be understood in the sense in which upto that time it had always in fact been used in India, where 764 indeed excise duties of any other kind were unknown. Nor indeed are excise duties properly so called often to be found at the present day which are not collected at the stage of production or manufacture, whatever may have been the case in Blackstone 's time and whatever may have been the reasons for Johnson 's definition of 'Excise ' in the first edition of his Dictionary (1755). "(Per Gwyer C.J.) This view was approved by the Judicial Committee in The Governor General in Council vs The Province of Madras An excise duty is according to the Indian Statute, a duty on the manufacture or production of goods and the duty which was levied in the States of Travancore and Cochin on the storage of tobacco cannot be regarded as a duty of excise. But that conclusion is not decisive of the problem under consideration. The question has still to be considered whether the Travancore and Cochin Acts and the Rules framed thereunder were law "corresponding" to the , extended under the Finance Act, 1950. The expression "corresponding" does not postulate identity of the State Law and the statute extended by section 11 of the Finance Act: if there was in force at the material time law in the Part B State dealing with a particular subject matter and the law extended by section 11 of the Finance Act, 1950, dealt with the same subject matter and the two laws though not identical still were such that if they stood together there would have been legislative duplication or overlapping, the law in force in Part B State would be regarded as corresponding to the law extended by the Indian Finance Act and hence repealed by the operation of section 13(2). Let us examine the scheme of the of 1944 for the purpose of 765 ascertaining whether the Travancore and the Cochin Tobacco Acts and Rules frame thereunder are law corresponding to the , wholly or partially. The , was enacted to consolidate and amend the law relating to Central duties of excise on goods manufactured or produced in certain parts of India and to salt. The expression "excisable goods" is defined in section 2(d) as meaning "goods specified in the First Schedule as being subject to a duty of excise and includes salt". By section 2(f) the expression "manufacture" is defined as inclusive of "any process incidental or ancillary to the completion of a manufactured product, and (i) in relation to tobacco includes the preparation of cigarettes, cigars, cheroots, biris, cigarette or pipe or hookah tobacco, chewing tobacco, or snuff x x x". By section 3 it is provided that there shall be levied and collected in such manner as may be prescribed duties of excise on all excisable goods other than salt which are produced or manufactured in India x x x and at the rates set forth in the First Schedule. By section 6, certain incidental operations are made subject to licence and it is provided: The Central Government may, by notification in Official Gazette, provide that, from such date as may be specified in the notification, no person shall, except under the authority and in accordance with the terms and conditions of a licence granted under this Act, engage in (a) the production or manufacture of any specified goods included in the First schedule or of saltpetre or of any specified component parts or ingredients of such goods or of specified containers of any specified excisable goods, or (b) the wholesale purchase or sale (whether on his own account or as a broker or commission agent or the storage of any excisable goods specified in this behalf in Part A of the Second Schedule". By virtue of these provisions power is conferred upon the Central Government to impose restrictions 766 upon the rights to produce, manufacture and to engage in any process of production or manufacture of the excisable goods or in the wholesale purchase or sale of excisable goods this power is conferred indisputably as ancillary to enforcing the law enacted for the levy and collection of excise duty. By section 9 contraventions of the provisions of the Act and notifications thereunder are penalised. Power to forfeit goods is conferred by section 10. By Chapter III, power to arrest and to summon persons to give evidence or produce documents in inquiries under the Act to search and the procedure to be followed by officers in charge of police stations, inquiries to be made by Central Excise Officers against arrested persons forwarded to them are made. Chapter VI deals with adjudication of confiscations and penalties, and Chapter VII enacts certain supplementary provisions. The Schedule to this Act sets out the descriptions of various goods and the rates of duty chargeable in respect thereof. The primary purpose of the Act is to levy and collect excise duty in respect of goods specified in the First Schedule and with that object in view, diverse provisions are enacted. Tobacco is under the Act an excisable commodity, and duty at rates specified in the Schedule is leviable in respect of different forms of tobacco. By section 6(b) wholesale purchase or sale, or storage of excisable articles is prohibited. By Rule 7 of the Central Excise Rules, 1944, duty is made payable by every person, who produces, cures, manufactures or who stores in any warehouse any excisable goods. Rule 174 which occurs in Chapter VII deals with licensing. It provides, in so far as it is material, that. "Every manufacture, trader or person hereinafter mentioned, shall be required to take out a licence and shall not conduct his business in regard to such goods otherwise 767 than by the authority, and subject to the terms and conditions of a licence granted by a duly authorised officer in the proper From: (1) Matches x x x (2) Unmanufactured products. Curers, brokers, Commission agents and wholesale dealers who purchase such products from cures, all brokers, commission agents and wholesale dealers doing business in unmanufactured tobacco; all holders of private bonded store rooms or warehouses; (3) Other excisable goods except salt (a) Manufacturers; and (b) x x x Rule 175 deals with the procedure for obtaining a licence. By the 1st clause it provides that every person desiring to engage in operations requiring the possession of a licence aforesaid shall apply in writing every year for a licence or renewal thereof to the licensing authority who shall be such officer as the Central Board of Revenue may authorise in this behalf. Rule 176 prescribes Forms application for licences and cl. (2) provides that every such application for licence shall, where a fee is prescribed in the subjoined Table, be accompanied by a Central Excise Revenue Stamp showing payment of such fee under item No. 2 in the Table "a wholesale dealer in unmanufactured tobacco who purchases for the purpose of trade or manufacture" the to pay graded fee set out in the second and the third columns. Item 6 deals with the duty payable by the holder of a private bonded store room or warehouse. Rule 178 provides for the Forms of licence. The appropriate forms of licence in respect of storage of tobacco for sale are Form L 2 (application for licence to carry on wholesale trade 768 in unmanufactured products liable to a central duty of excise), Form L 3 (application for licence as broker or commission agent in respect of unmanufactured products liable to a central duty of excise), and Form L 5 (application for licence for a private bonded warehouse storeroom for the storage of excisable goods). It is manifest that under the Rules so framed duty is imposed to obtain a licence on payment of fee for storage of tobacco for sale. It is not disputed that the appellants in all the appeals took out licences under rules 174 and 178 of the and paid the licence fee in that behalf to the Central Government. The appellants were also required to pay licence fee for the storage of tobacco for sale under the provisions of the Travancore and the Cochin Tobacco Acts and the Rules framed thereunder on January 25, 1951. It is true that under the , the provision for obtaining licences for storage is a provision ancillary to the recovery of excise duty, whereas under the Travancore and the Cochin Acts, the levy of licence fee was imposed in pursuance of a scheme for maintaining control on the sale of tobacco without expressly levying any excise duty. But on that account, it cannot be said that the provisions relating to the requirement of licences and the payment of licence fees for storage of tobacco for sale under the Travancore and the Cochin Acts were not provision corresponding to the provisions of section 6(b) under the and the rules framed under the Act requiring that licences shall be taken out for storage of tobacco for sale and fee shall be paid in respect thereof. In my judgment the relevant rules made under the Travancore and the Cochin Tobacco Acts requiring licences to be taken for storage of tobacco and in force on April, 1, 1950, were law corresponding to the provisions of the Central Excise and Salt Act, 1944, and the rules 769 framed thereunder which required licences to be taken out for storage of tobacco and for payment of licence fee in respect thereof and to that extent the provisions imposing an obligation to take out licences and to pay licence fees under the Tobacco Acts of Travancor and the Cochin States were superseded and the State of Travancore Cochin had no authority to promulgate rules 14, 15 and 16 under the Notification issued in the Travancore Cochin Government Gazette dated January 25,1951, and to levy licence fee for storage of tobacco. It is unnecessary to consider whether the remaining provisions of the Travancore and the Cochin Tobacco Acts and the Rules framed there under were law corresponding with the . For these reasons I agree that the appeals be allowed, and the order passed by the High Court be set aside. In each petition a writ will issue declaring that the levy of licence fee under the Notification dated January 25, 1951, is without authority of law, and that the State of Travancore Cochin do forbear from levying and collecting the licence fee. Appeals allowed.

ln 1909 the Ruler of the erstwhile State of Cochin enacted the Cochin Tobacco Act of 1084 (M.E.) with the object of controlling the cultivation, production, manufacture, storage and sale of tobacco. Rules were framed under the Act for regulating the cultivation, possession, transportation and sale of tobacco and a system of licensing was introduced for that purpose. Licences for storage were to be annual and to be issued on payment of licence fee. The authorities administering the provisionals of the Act and the Rules framed thereunder were the (commissioner of Excise and his subordinates. The system in force for the collection of tobacco revenue was to auction what were called A class and class shops. A law similar to that prevailing in Cochin was promulgated in 1911 by the Ruler of Travancore as the Travancore Tobacco Regulation of 1087 (M.E.). The two States merged themselves in 1919 as the State of Travancore Cochin but the two Acts continued to remain in force in the respective territories. On April 1, 1950, after the Constitution of India had come into force and Travancore cochin had become a 742 Part B State thereunder by s.11 of the Finance Act, 1950, the central Excises and Salt Act,194,was ex tended to that State. Section 13(2) of the Finance Act, 1950,provided that "if immediately before the 1st day of April,.1950, there is in force in any State other than Jammu and Kashmir a law correspo nding to,but other than, an Act referred to in sub s.(1) or (2) of s.11, such law is repealed with effect from the said date. " After this provision in the Finance Act, 1950, the Rules which were in force on April 1, 1950, were changed in the Cochin area by a notification dated August 3, 1950, and the system of auction sales of A Class and Class shops was done away with and instead graded licence fees were introduced for various classes of licensees. Similar change was made for the Travancore area by notification dated January 25, 1951. The appellants who were carrying on business in tobacco within the territories of Travancore and Cochin challenged the legal its of the notifications of August 3, 1950,and January 25, 1951, on the ground that the Cochin Tobacco Act and the Travancore Tobacco Regulation under which the notifications were purported to be issued, were law corresponding to the , and so they stood repealed from April 1, 1950, by virtue of the operation of sections 11 and 13(2) of the Finance Act. It was contended for the State of Kerala that the main feature of the Central Excise and Salt Act, 1944, was the imposition of a duty of excise on goods produced or manufactured in ,India and that there was no provision for charging duty in the Cochin Act or the similar Travancore Act and therefore all these provisions in the Rules for the control of tobacco from the time of cultivation to the time of the final stage of sale to the consumer, even though they were similar to the Rules under the Central Act, would not make the Cochin Act or the similar Travancore Act a law corresponding to the Central Act. ^ Held, that the rules framed under the Cochin Tobacco Act of 1084(M.E.) and the Travancore Tobacco Regulation of 1087 (M E.) requiring licences to be taken out for storage and sale of tobacco and for payment of licence fee in respect thereof were law corresponding to the provisions of the , and, hence, were superseded on April 1, 1950, by virtue of section 1312) of the Finance Act, 1950. consequently, the new Rules framed in August 1950 and January 1951 for the respective areas of Cochin and the respective areas of Cochin and Travancore for the issue of license and payment of fee therefore for storage of tobacco, were invalid ab initio. Per Sinha, C. J., 'Gajendragadkar,Wanchoo and Hidayatullah, JJ. (I) The Cochin Tobacco Act, 1084 743 (M.E.), as well as the Travancore Tobacco Regulation, 1087(M.E.), were in substance law corresponding to the , and therefore, stood repealed on April 1, 1950. (2) The auction system which was in force under the Cochin and Travancore Acts was only a method of realising duty through the grant of licences to those who made the highest bid at the auctions. The fact that this system was used instead of the system of charging of duty as provided in s.3 of the Central Excise and Salt Act, 1944, would not make any difference to the nature of the impost; the income from auctions was in the nature of excise duty. Per Shab, .J. An Excise duty is, according to the Indian statute, a duty on the manufacture or production of goods and the duty which was levied in the States of Travancore and Cochin on the storage of tobacco cannot be regarded as a duty of excise. In re The Central Provinces and Berar Sales of Motor Spirit and Lubricants Taxation Act, 1938, , The Province of Madras vs Messrs Boddu Paidanna and Sons, , Governor General in Council vs Province of Madras, (1945) ' L.R. 72 I.A. 91 and Chaturbhai, M. Petal vs The Union of India, ; , considered.

iminal Appeals Nos. 146 and 147 of 60. Appeals by special leave from the judgment and order dated February 11, 1960, of the Madhya Pradesh High Court in Criminal Revisions Nos. 270 to 274 of 1959. G. C. Mathur, for the appellants. I. N. Shroff, for the respondents. February 5. The Judgment of the Court was delivered by KAPUR, J. There are two appeals directed against the order of the High Court of Madhya 22 Pradesh reiecting a Reference made by the Sessions Judge against the prosecution of. the appellant for contravening the provisions of the C. P. and Berar Sales Tax Act (C. P. XXI of 1947), hereinafter called the 'Act '. A firm of which five brothers including the two appellants were partners submitted their sales tax returns for the quarters beginning June 1, 1947, to the quarters ending December 31, 1951. A .complaint was filed against the partners on July 19, 1957, on the ground that the returns filed by them were false and the accounts produced were incorrect and therefore an offence under section 24(1)(b) and (g) of the Act was committed. On December 12, 1958, an objection was taken by the accused. persons that under section 26(2) of the Act, the prosecution could not be instituted as it was barred by time, having been instituted more than three months after the commission of the offence. The learned, Magistrate did not go into the objection on the ground that it was not the proper forum for raising the objection. Four revisions were taken to the Sessions Judge who on May 4, 1959, made a reference to the High Court for quashing the proceedings But the High Court rejected the reference on the ground that a person making a false return neither acts nor purports to act under the Act and therefore section 26(2) is not applicable to him. It is against that order that these peals were brought by Special Leave. In order to decide this question, it is necessary to refer to the relevant provisions of the Act. Under section 10 of the Act every dealer is required to furnish a return when called upon to do so and every registered dealer is required to furnish returns by such dates as may be prescribed. The ap pellants are registered dealers and they have made returns under that section. Section 15 deals with 23 production and inspection of accounts and section 24 enumerates the offenses under the Act. The alleged offence of the appellants falls under is. 34(1) (b) and (g). failing without sufficient use to submit any return or furnishing false returns and knowingly producing incorrect accounts, registers or documents or knowingly furnishing incorrect information. Section 26 relates to the protection of persons acting in good faith and limitation for suits and prosecutions. The section when quoted is as follows section 26 (1) "No suit, prosecution or other legal proceedings shall lie against any servant of the Government for anything which is in good faith done or intended to be done under this Act or rules made thereunder. (2) No suit shall be instituted against the Government and no prosecution or suit shall be instituted against 'any person in respect of anything done or intended to be done under this Act unless the suit or prosecution has been instituted within three months from the date of the act complained of. " For the appellants, it was contended that the words "no prosecution or suit shall be, instituted against any person in respect of anything done" in sub section (2) of section 26 cover their cases also and they fall within the words ",any person". The respondent 's submission on this point was that the two sub sections of section 26 should be read together and the intention of the Legislature was to give protection to Government servants in regard to prosecutions or other legal proceedings. That, in our opinion, is not *hat the words used in sub section (2) mean. , They are words of wider import and would cover cases of all persons including persons other than Government servants. There are ' no words restricting the meaning of "any person" and no 24 reason has been shown why those words should not include the appellants. The ground on which the High Court rejected the Reference was that in its opinion the appellants neither acted nor purported to act under any of the provisions of the Act when they filed false returns or produced false accounts and in fact they were rendering. themselves liable to punishment under the provisions of section 24 of the Act. It observed as follows : "The test whether an act is done or intended to be done under a certain law might well be whether the person who committed it can, if challenged, reasonably justify his act under any provision contained in that law". This opinion is, in our view, not sustainable. When the appellants submitted their returns they did so under section 10 of the Act and when they produced their accounts they did so under section 15 of the Act. Therefore both the making of the returns and production of the accounts were done under the Act and cannot be said to be outside the provisions of the Act. In our opinion the High Court was in error in rejecting the Reference. The appeals are therefore allowed, the order of the High Court is set aside aid the proceedings in the trial court are quashed. Appeals allowed.

The appellants submitted their returns of sales tax. More than three months afterwards a complaint was filed against them under section 24(1)(b) and (g) of the C. P. and Berar Sales Tax Act ' alleging that the returns filed Were false and that the accounts produced were incorrect. They contended that the prosecution was barred by section 26(2) of the Act which provided that no prosecution shall be instituted against any person in respect of anything done or intended to be done under the Act unless it was instituted within three months from the date of the act complained of. Held, that the prosecution was barred by section 26(2) of the Act. The words "any person" in section 26(2) were words of wide import and included the appellants. There was no reason to restrict them to Government servants. Both the making of the return and the production of the accounts were acts done under the Act; the return being filed under section 10 and the accounts being produced under section 15 of the Act. Section 26(2) was thus clearly applicable to the case.

Appeals Nos. 344 346 of 1960. Appeals by special leave from the judgment and order dated September 8. 1958, of the Madhya Pradesh High Court (Indore Bench), Indore, in Civil Second Appeals Nos. 11.0 1,12 of, 1952. section T.Desai and J. B. Dadachanjifor the appellant. B. Sen,J. Bhave and 1. N. Shroff,for the respondent. July 17. The Judgment of the Court was delivered by HIDAYATULLAH, J. These three consolidated appeals by special leave are against a common judgment and order of the High Court of Madhya Pradesh, dated September 8, 1958, in three second appeals filed under R. 13 of the Indore Industrial Tax Rules, 1927 of the former Holkar State, which were in force before the State became part of Madhya Bharat State. They concern three assessments relating to the assessment years, 1941,1942 and 1943 respectively. These second appeals were originally filed in the Madhya Bharat High Court as early as 1952 ; but the records of the appeals 'were destroyed by fire and had to be reconstructed. By the time the appeals were ready, Madhya Bharat had merged in the new state of Madhya Pradesh, and the appeals were accordingly heard by a Divisional Bench of that High Court. The appellant is a Textile Mill and a public Joint Stock Company called the Nandlal Bhandari Mills, Ltd. The appellant had appointed a" firm, Messrs Nandlal Bhandari and Sons as agents, secretaries and treasurers of the Mills, and under cl. (6) of the agreement of agency, it agreed to pay to the agents an office allowance, commission on the Company 's net profits and commission on the sale proceeds. of sales of yam, cloth, etc. The 861 remuneration of the agents for the three accounting years was as follows : ___________________________________________________________ Remuneration As per Accounting Years, agree ment. 1941 1912 1943 Rs. Rs. Rs. __________________________________________________________ Clause 6 1500 18,000 18,00018,000 (a) Fixed P.M. for the for the monthly allow year. ance as office allowance. (b) Commission @ 16% 2,68,335 6,15,946 10,52,939 on the Com net on painy 's Net profits Profits. (c) Commission @ 1 9 0 1,10,156 1,10156 1,64,751 2,71,672 on the sale Per Cent, proceeds of on sales sales of yarn, cloth etc. ___________________________________________________________ In computing the tax, the Mills claimed to deduct under R. 3(2)(ix) of the Rules the above amounts paid as remuneration. The Rule reads : "(ix) any expenditure (not being in the nature of capital) incurred solely for the purposes of earning such profits or gains." The Assessing Officer accepted the appellant 's claim for deduction but only as. to a part. We are not required in these appeals to consider the correctness of the quantum of the deduction in view of what transpired later. The Assessing Officer also disallowed certain other claims made by the appellant, which again need 'not be mentioned. The appellant then. appealed to the Appellate Authority, and on December 31, 1951 the Appellate Authority, while accepting some of 862 the appellant 's other contentions upheld the order refusing to deduct the agent,s commission on profits under R. 3(2)(ix). Three second appeals were preferred in the Madhya Bharat High Court under R. 13 of the amended Rules. They were dismissed by the High Court of Madhya Pradesh, and hence the present appeals. The Indore Industrial Tax Rules were first promulgated in 1926 by a Cabinet Resolution (No. 373 dated March 22, 1926). In 1927, by, Cabinet Resolution No. 1991 dated November 23 1927, the Rules were modified, and the new Rules, were made applicable retrospectively from May 1, 1926. These Rules were framed for the levy of the tax and for ascertainment and determination of the income of cotton mills. The taxcalled the "Industrial Tax" was leviable under R. 3, which imposed the charge. It says that the Industrial Tax shall be payable by an assessee in respect of the profits or gains of any Cotton Mill industry carried on by him in the Holkar State. Sub r. (2) of R. 3 provides that such profits or gains are to be computed after making allowances, inter alia, for any expenditure incurred solely for the purpose of earning such profits or gains, R. 6, which is a part of the Rule imposing a charge, lays down the rates which are : (a) on all incomes up to Rs. 50,000, at 1 1/2 annas per rupee, and (b) above, at 2 1/2 annas per rupee. The short question thus was whether in computing the profits and gains of the appellant, the remuneration paid to the agents was deductible under R. 3 (2) (ix). It is necessary At this stage to see the legislative machinery existing in the Holkar State in 1927 and onwards. On February 27, 1926, His Highness Maharaja Tukoji Rao III abdicated, and, his son, H.H. Maharaja Yeshwant Rao Holkar, became the Ruler, whose installation ceremony ' was performed on March 11, 1926. A Regency Council was appointed under the orders of the 863 Government of India for the administration ' of the State during the minority of the Maharaja. This Regency Council, which was called the Cabinet, was entrusted with the administration of the State according to existing rules and practice, under the supervision and with the advice of the Agent to the Governor General in Central India. Prime Minister of the State was the Chairman. H. H. Maharaja Yeshwant Rao Holkar attained majority on September 6, 1929 and resumed sovereign powers on May 9, 1930. It was during the minority of the Ruler that the Cabinet had promulgated the amended Rules of 1927. In 1931, the decision of the Privy Council in the well known case of Pondicherry Railway Co., Ltd. vs Commissioner oF Income tax (1) was rendered. In that case, a Railway Company had agreed to make over to the French Colonial Government half of the Company 's net profits in consideration of a 99 year concession. This was sought to be deducted by the Company from its assessable profits as an expenditure incurred solely for the purpose of earning such profits. The Privy Council disallowed the deduction. Lord Macmillan observed as follows : "A payment out of profits and conditional on profits being earned cannot accurately be described as a payment made to earn profits. It assumes that profits have first come into existence. But profits on their coming into existence attract tax at that point and the revenue is not concerned with the subsequent application of the profits. " It seems that, as a result of this decision, a notification was issued in August, 1931, and another on February 2/3, 1932 by the Commerce. and Industry Department of the Holkar State. The latter notification reads as follows (1) (1931) L.R. 38 I.A. 239. 864 "Commerce and Industry Department Notification. Notification No. 1 dated the 2nd/3rd Feb. 19 32. In continuation of this office Notification No. 4733 dated the 6th December, 1927 (Vide Issue No. 11 dated the 12th December, 1927, of the Holkar Sirkar Gazette) embodying modified rules for the levy of the Industrial Tax the Cabinet,in their Resolution No. 1072 dated the 25th August, 1931, have ordered that the Agents ' Commission on 'Profits ' should not be allowed to be deducted from the assessable profits. " It is, to be noticed that this notification refers to the earlier notification No. 4733 of December 6, 1927, under which were published the amended Industrial Tax Rules, 1927, and to the notification of August 1931. The latter has not been produced before us. This notification led to representations by the persons affected by it. The Maharaja of Holkar thereupon referred the matter for the opinion of the, Full Bench of the High Court of the State. It appears that the opinion of the High Court was in favour of disallowing such deductions. On July 14, 1933, another notification (No. 13) was issued which reads as follows : "In continuation of this office Notification No. 1 dated 3rd February,, 1932, it is hereby published for the information of the mills and factories concerned that on submission of the Prime Minister 's (Legal Department) report No. 25 dated 11th May, 1933, His Highness the Maharaja is please to order (vide Huzur Shri Shankar, Order No. 173 dated 29th June,1933) that the opinion of the Full Bench of the High Court being that the Managing Agent 's Commission an profit 's is 865 not an item of expenditure incurred solely for the purpose of earning the said profit within the meaning of Rule 3(2)(ix) of the said Industrial Tax Rules and this being. also the view of the Cabinet as expressed in their resolution No. 1072 dated 28th August, 1931, the aforesaid Cabinet Resolution be given effect to and the industrial tax due on the amount of the managing agent 's commission on profits be recovered with effect from the date of the said Cabinet Resolution. " This notification, it is contended before this Court had not the force of law and was not enforceable against the appellants, who claim that they are entitled to show that the remuneration paid to the agents was deductible from the profits of the Mills before. computing the Industrial Tax. In this connection, the appellants wish to use the later decisions of the House of Lords in The Union Cold &wage Co., Ltd. vs Adamson(1) and of the Privy Council in The Indian Radio and Cable Communication Co., Ltd. vs Commissioner of I Income tax (2), in which the decision in the Pondicherry Railway Company case (3) was explained. In the case before the Privy Council, Lord Maugham observed: "It is not universally true to say that a, payment the making of which is conditional on profits being earned cannot properly be described as an expenditure incurred for the purpose of earning such profits. The typical exception is that of a payment to a, director or a manager of a commission on the profits of a company '. If a company having made; an apparent net profit, of pound 10,000 has then to pay pound 1,000 to directors, or managers as the contractual recompense for their service during the year, it: is plain that the real net profit is only pound 9,000. " (1) (2) (3) (1931) L.R. 58 (1) A. 239. 866 Lord Macmillan in the former case observed that the Pondicherry Railway Company case (1) must be read in the context of the facts of that case, and the obligation was first to find out the net profits of the company and then to divide them. These two sets of cases proceed upon different principles. If the agreement is to share the profits the expenditure cannot properly be treated as one incurred solely for the purpose of earning such profits; but if a slice of the profits is;to be paid to persons as remuneration to help in the earning of the profits, the deduction can be claimed. All this would of course be pertinent to consider, if there was no legislative enactment on the subject. If the matter was not one concluded by law, then there would be room for judicial interpretation of the Rule. The rival claims in these appeals are thus confined to the legislative force of the notifications issued in 1931, 1932 and 1933 respectively,. The appellant 's contention is that the notifications were not an act of legislation but an interpretation by the Sovereign. Mr. Desai concedes that if they be regarded as legislation, then the later decisions of the Privy Council and some of this Court cannot be called in aid, because where the law itself speaks with clarity, judicial interpretation is out of place. He contends, how ever that the two notifications were not framed as rules and were not expressly stated to be amendments of the rules then existing. He points out that after the first notification which was nothing more than an administrative direction to the assessing officers to include in the profits the remuneration of the agents, the opinion of the High Court was obtained, and the second notification merely pointed out that the earlier notification was to be given effect to, and did no more than add a second administrative direction. On the other side, it is contended that the Cabinet could make laws as often as it pleased and that (1) (1931) L. R. 58 I. A. 239. 867 the notifications must be read either as independent rules or as a legislative explanation of R. 3 (2) (ix). In so far as the legislative supremacy of the Cabinet was concerned, no question was raised before us. When the Indore Industrial Tax Rules, 1926 were framed, they came into existence by virtue of a Cabinet Resolution of that year. When they were modified, they were superseded by yet another Cabinet Resolution of the year 1927, which promulgated the new Rules with retrospective effect from May 1926. The source of the Rules 'was thus a Resolution of the Cabinet on both the occasions, and it is not denied that the Rules thus framed had legislative sanction and were unquestionable. When the Cabinet promulgated its notifications in 1931, 1932 and 1933, it followed the same procedure, and it stated that the notification of 1932 was " 'in continuation of this office Notification No. 4733 dated December 6, 1927. " This has reference to that notification under which the Indore Industrial Tax Rules, 1927 were orginally published. From this, it follows that new Rules were framed by a resolution of the Cabinet and were promulgated by a notification in the Gazette as part of the Rules. The mode followed in 1926 and 1927 was repeated in 1932 and 1933 and also presumably in 1931, though the notification of that year has not been printed in the record of this case. This view was taken by the Full Bench of the ' Madhya Bharat High Court in Raj Kumar Mills Ltd. vs Madhya Bharat State (1). The question which is involved in these appeals also arose in that case. It was observed by the Full Bench : "This Notification makes it abundantly clear that His Highness the Maharaja ordered that the industrial tax due on the amount of the managing agent 's commission on profits be recovered. This being. an order of the (1) A.I.R. 1953 Madbya Bharat 135. 868 ruler, who enjoyed sovereign Powers, that order is not open to challenge. This is a mandate emanating from a sovereign and as such has the force of law. This Court has, therefore, no power to go behind the order and enquire as to whether the managing agent 's commission on profits is an item of expenditure solely incurred for the 'purpose of earning profits or not: In this view of the matter the point at issue is concluded by Huzur Shri Shanker order No. 173 dated 29th June, 1933. " Thus view was affirmed by the High Court of Madhya Pradesh in the judgment under appeal. In our judgment, the two notifications cannot be described as "judicial ,interpretation". If any this, they must be interpreted as legislative exposition of R. 3(2)(ix) and in the nature of an explanation. This Court in Ameer un nissa Begum vs Mahboob Begum in dealing with the 'Firmans" of His Exalted Highness the Nizam of Hyderabad, observed as follows : "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 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 (1)A.I.R. 869 the rights of the parties concerned, though it could be annulled or modified by a latter 'Firman ' at any time that the Nizam willed. " The same can be said of the Ruler of the Holkar State. When to the order of the Ruler was added the usual mode of making and promulgating rules, the position which emerges is really unassailable. Mr. Desai in attempting to show that the ruling does not apply to the case, raised two contentions. The first was based upon a more recent decision of this Court in Madhaorao vs State of Madhya Bharat (1), where certain Kalambandis of the Maharaja of Gwalior were considered. This Court in deciding whether the Kalambandis were existing law under article 372 of the Constitution, observed : "In dealing with the question as to whether the orders issued by such an absolute monarch amount to a law or regulation having the force of law, or whether they constitute merely administrative orders, it is important to bear in mind that the distinction between executive orders and legislative commands is likely to be merely academic where the Ruler is the source of all power. There was no constitutional limitation upon the authority of the Ruler to act in any capacity he liked ; he would be the supreme legislature, the supreme judiciary and the supreme head of the executive, and all his orders, however issued, would have the force of law and would govern and regulate the affairs of the State including the rights of its citizens.", It was, however, pointed out in the case that even where an order is issued by the sovereign ruler, one must look to the character of the order and its content to find out whether it enacted a binding rules (1) ; 870 Mr. Desai has constructed his entire argument on the basis of these observations, and has contended that the orders only expressed an opinion and did not bind. He pointed out as the second limb of his argument that these notifications were not expressed as a rule but as an order, and that they did not seek to amend the rules, nor to add to them. He referred to other notifications in which a legislative act was clearly discernible, as for example, Notification No. 22/Com. dated May 17, 1946, by which for the existing Rule 4, a new Rule was substituted. An examination of the Rules, however, shows that there was no set pattern of language. Some of the Rules do not read like rules at all. Notes have been appended to the rules, which are not rules proper, and R. 29 says : "All matters not dealt with in these rules may be submitted to the member incharge., Commerce and Industry Department for decision. " The existence of such a rule seems to obliterate the frontiers between legislative, judicial and executive exercise of the power of a State, such as we understand it. There being no invariable use of a clear cut legislative language, each general order emanating from the sovereign ruler and promulgated in the same manner as any other rule and having its roots in a resolution of the Cabinet must be regarded as one binding upon the subject. This is the purport of the decisions of this Court, and the present case falls in line with those which have been previously decided. There is nothing in the content, the character or the nature of these notifications, which would put them on a level lower than the Rules, which had been earlier promulgated. In our opinion., the judgment of the High Court under appeal is correct, and the appeals are accordingly dismissed with costs, one set. Appeals dismissed.

By a Cabinet Resolution of the Holkar State certain Rules known as The Indore Industrial Tax Rules were framed for the purpose of levying industrial tax. After the decision of the Privy Council in cherry Railway Go. , Ltd. vs Commissioner Income, tax, (1931) L. R. 58 1. A. 239, disallowing deduction , of Commission paid out of profits to agents from the assessable profits; the Government of Holkar State of which the Maharaja was the Supreme Ruler; issued certain Notifications ordering that the Agents ' Commission on profits should not be allowed to be deducted from the assessable profits. The appellants who under an agreement paid commission to their agents out of the company 's net profits contended, inter alia, that the Notifications in question did not have the force of law and was not enforceable against the appellants. Held, that every general order emanating from the sovereign ruler having its roots in a resolution of the cabinet must be regarded as a law binding on the subject and the Notifications disallowing commission paid to, agents to be deducted from the assessable profits were therefore binding on the appellants, because that was the normal mode by which laws were made in the Holkar State. Rajkumar Mills Ltd. vs Madhya Bharat State, A. I. R. 1953 Madhya Bharat 135, approved. Ameer un nissa Begum vs Mahboob Begum, A. I. R. , followed. The Union Cold Storage Co., Ltd. vs Anderson, (1931) 16 T. C. 293 and The Indian Radio and Cable Communications Co., Ltd. vs Commissioner of Income tax, , discussed. Madharao vs State of Madhya Bharat, ; , referred to. 860

minal Appeal No. 102 of 1960. Appeal by special leave from the judgment and order dated October 7, 1959, of the Punjab High Court in Criminal Revision No. 610 of 1959. Hardev Singh and Y. Kumar, for the appellants. section M. Sikri, Advocate General for the State of Punjab, N. section Bindra and P. D. Menon, for the respondent. February 6. The four appellants were at one time members of the Pepsu Police force and were charged, before the First Class Magistrate at Faridkot, with having committed three offenses : (1) under section 26 of the PepsU Public Safety Ordinance (No. 7 of Samvat 2006), (2) under section 33 of the said Ordinance, and (3) under section 1 of the impugned Act. We shall be referring to the provisions of the relevant enactments in due course. The accused pleaded not guilty and were tried by the learned Magistrate who by his judgment dated August 28, 1958, held the 27 prosecution case fully established against all the accused. He convicted the four appellants under section 26 of the Public Safety Ordinance and sentenced them to imprisonment for six months. The third appellant alone Was convicted of the offence under a. 33 of the same Ordinance and was sentenced to imprisonment for six months. Appellants 1, 2 and 4 were further convicted of offenses under section 3 of the impugned Act and sentenced, to imprisonment for six months, the several sentences against the respective accused being directed to run concurrently. The appellants filed an appeal to the Sessions Judge at Bhatinda who upheld the convictions but reduced the sentences. In respect of the offence under section 26 of the Public Safety Ordinance the sentence passed against the four appellants was reduced to imprisonment for three months while in respect of the third accused who had been addition ally sentenced under section 33 of the Ordinance the same was reduced to imprisonment for 11 /2 months and the sentences on appellants 1, 2 and 4 under section 3 of the impugned Act was reduced to imprisonment for three months, the sentences again being directed to run concurrently. With these modifications the appeals stood dismissed. The appellants thereafter preferred a revision to the, High Court and this was heard by a learned Single Judge who while accepting the revision of the appellants in so far as it related to their conviction and sentence under section 26 of the Ordinance. maintained the other convictions and sentences but reduced the sentences. It is from this judgment of the High Court that this appeal has been preferred by the four appellants. It would be seen from the above narrative that the appeal is concerned with the propriety of the conviction of appellants 1, 2 and 4 of an offence under a. 3 of the impugned Act and of the third appellant under section 33 of the Ordinance, all the appellants having been acquitted by the High Court of the charge against them under s, 26 of the 28 Ordinance. It is therefore not necessary to refer to the terms of section 26 or the offence constituted by it. In the Courts below including the High Court no challenge was made as regards the legality of any of the provisions of law of the violation of which the appellants were found guilty but before us though learned Counsel did not raise any contention regarding the validity of section 33 of the Pepsu Public Safety Ordinance, challenged the constitutionality of section 3 of the impugned Pepsu Police (Incitement to disaffection) Act which appellants 1, 2 and 4 were found to have violated and for which they were sentenced to a term of imprisonment. Learned Counsel for the appellants raised for our consideration three points : (1) the constitutional validity of s.3 of the impugned Act, (2) if section 3 were constitutional and valid whether appellants 1, 2 and 4 were proved to have been guilty of an offence for violating that provision, and (3) whether appellant 3 was property held guilty of an offence under section 33 of the Pepsu Public Safety Ordinance. We shall first take up for consideration the attack on the validity of section 3 of the impugned Act. Patiala and East Punjab State Union, commonly called Pepsu was one of the States specified in Part B of the First Schedule to the Constitution when the Constitution was brought into force in January 1950. For reasons not necessary to be stated here, the administration of Pepsu was taken over by the President under article 356 of the Constitution. The powers of the State Legislature were declared by the Presidential Proclamation issued on March 4, 1953. to be "exercisable by or under the authority of Parliament" (vide article 356(1)(b) ). Thereafter Parliament enacted Act XXII of 1953 which received the assent of the President on May 17, 1953, which was entitled : "The Patiala and East Punjab States Union Legislature (Delegation of Powers) Act, 1953. " Section 3 of this enactment provided 29 "The power of the legislature of the State of Patiala and East Punjab States Union to make laws which has been declared by the proclamation to be exercisable by or under the authority of the Parliament is hereby con ferred on the President. " There are other provisions which are contained in the other subsections of section 3 but these have no relevance for this appeal. In exercise of the power thus delegated to him by Parliament the President enacted Pepsu Act 1 of 1953 whose long title runs : "An Act to provide a penalty for spreading disaffection among the police and for kindred offenses. " It is the 3rd section of this enactment whose validity is challenged in this appeal and that reads "3. Penalty for causing disaffection, etc. Whoever inte ntionally causes or attempts to cause, or does any act which he knows is likely to cause, disaffection towards any Government established by law in India amongst the members of a police force, or induces or; attempts to induce, or does any act which he knows is likely to induce, any member of a police force to withhold his services or to commit a breach of discipline shall be punishable with imprisonment which may extend to six months, or with fine, or with both. " The attack upon the validity of this provision was rested on its being violative of the freedom guaranteed by article 19(1)(a), the submission being that the section was Dot saved by article 19(2). Before considering the arguments advanced it is necessary to mention, for being put aside, that in construing the validity of section 3 of the impugned Act 30 the provision contained in article 33 of the Constitution has no relevance. That Article enacts : "article 33. Parliament may by law determine to what extent any of the rights conferred by this Part, shall in their application to the members of the Armed Forces or the Forces charged with the maintenance of public order, be restricted or abrogated so as to en,sure the proper discharge of their duties and the maintenance of discipline among them. " No doubt, the impugned provision is concerned with ensuring discipline among the forces charged with the maintenance of public order but as the powers of the President were exercised by virtue of the delegation contained in section 3 of Act XXII of 1953 under which only the powers of the State Legislature were vested in him, any law enacted by him would not have the force of Parliamentary legislation contemplated by article 33. Article '33 being out of the way the very short question that has to be considered is whether the impugned provision is saved by Art '. 19(2), for 'it is common ground that provision does not violate any freedom other than that of ""free speech and expression" guaranteed by article 19 (1) (a). Article 19(2) as it stands after the amendment by the Constitution (First Amendment) Act of 1951 reads : " 19(2) Nothing in sub clause (a) of clause (1) shall affect the operation of any existing law, or prevent the State from making any law, 'in so far as such law imposes reasonable restrictions on the exercise of the right conferred by the said sub clause in the interest of the security of the State, friendly relations with foreign States, public order, decency or morality, or in relation to contempt of Court, defamation or incitement to an offence. " of the criteria set out in this clause the one relevant 31 in the present context is that which refers to "in the interests of. . public order". The contention urged by learned Counsel was that section 3 was too wide in that it embraced within itself not merely matters which might have relevance to circumstances intimately connected with the maintenance of public order, but also those whose connection with it might be remote or fanciful. While not seriously disputing that seducing the loyalty of the police force, or inducing the. members thereof not to do their duty might imperil public order and so fall within the limit of restrictions permissible of imposition under article 19(2), learned Counsel laid, stress on the fact that the impugned section made it an offence to induce a member of the police force to "commit a breach of discipline," laying special emphasis on the fact that the words "breach of discipline" besides being vague, might include within itself acts which might be innocent as well as others of varying degrees of culpability. The content of the expression "in the interests of. . public order" has been the subject of detailed and elaborate consideration by this Court in Superintendent, Central Prison, Fatehgarh vs Ram Manohar Lohia (1) where the effect of the First (Constitution) Amendment by which the words "for the maintenance of public order" were replaced by the words ",in the interests of public order" was considered in the light of the previous decisions of this Court on that topic, Subba Rao, J., speaking for this Court said that the expression "Public order" in the juxtaposition of the different grounds set out in article 19(2) was synonymous with "public peace, safety and tranquility". He also pointed out that the expression ,in the interests of public order" though undoubtedly wider than the previous phrasing ",for the maintenance of public order" could not mean that the existence of any remote or fanciful connection between the impugned act (1) ; 32 and public order was sufficient to sustain the validity of the law, but that on the other hand, the connection between the act prohibited or penalised and public order should be intimate; in other words there should be a reasonable and rational relation between it and the object sought to be achieved, viz., public order. The nexus should thus be proximate not far fetched, problematical or too remote in the chain of its relation with public order. Keeping this exposition in mind. the question to be considered is whether the connection between what is prohibited or penalised by the impugned provision and public order, i.e., the ensuring of tranquility and orderly life is so remote or fanciful as to lead to an inference that there is no proximate connection between the two. We have no hesitation in answering this question against the appellants. The impugned enactment seeks to lay an embargo on certain activities in the interests of the Police service which is the arm of the State barged with the duty of ensuring and maintaining public order. The efficiency of that service and its utility in achieving the purpose for which it is formed aid exists is sought to be secured by penalising attempts to undermine its loyalty and dissuade the members of that force from performing their functions and being available to the State as a disciplined body, Any breach in the discipline by its members must necessarily be reflected in a threat to public order and tranquility. If the police force itself were indisciplined they could hardly serve as instruments for the maintenance of public order or function properly as the machinery through which order could be maintained among the general public. As we have pointed out earlier, learned Counsel did not seriously contest that the impugned provision in so far as it penalised the creation of disaffection among members of the police force or the incitement of the members of the police force to withhold their services from the government could properly be sustained as enacted 33 ", 'in the interests of public order," We consider that attempts to induce indiscipline among the police do not stand on any different footing. We do not further consider well founded the submission of learned Counsel that the word "discipline" or the .Phrase "breach of discipline" is vague. We have therefore no hesitation in rejecting this challenge to the validity of a. 3 of the impugned Act. The next question that was urged by learned Counsel was that the High Court was wrong in considering that the three appellants 1, 2 and 4 were guilty of any contravention of section 3 of the Act. We do not consider that this submission is justified. It is needless to point out that in considering an appeal which comes before us by special leave this Court normally accepts as final every finding of fact reached by the High Court as well as its appreciation of oral testimony and that if there is evidence which could serve as a basic for any finding reached by the High Court the same cannot be canvassed before us. If the submission of learned Counsel is viewed in the light of this principle it appears to us that there is hardly any scope for argument as regards what might be termed the merits of the case. One of the "witnesses whose evidence has been accepted by the Courts below and which is referred to in the judgment of the learned Judge in the High Court was Krishan Dayal P.W. 4 who deposed to the accused saying ",Police brothers, come and join us, stop the office work; we will sit here in dharma, start hunger strike. . and would not allow the office work to run. " It is clear from this evidence that the accused had induced or had attempted to induce members of the police force to withhold their services as also to commit a breach of discipline by staying away without doing their duty. In our opinion, it is not shown that the conviction of appellants 1, 2 and 4 of an offence under section 3 of Act 1 of 1953 was improper or illegal. 34 The last of the points arising in the appeal is as regards the conviction of Lal Singh the third appellant .of an offence under, section 33 of the Ordinanoe. Section 33 of the Ordinance runs : ,"Whoever induces or attempts: to induce any public servant or any servant of local authority to disregard or fail in his duties as such servant shall be punishable with imprisonment which may extend to one year or with fine or with both. " As regards this appellant this is what the learned Judge of the High Court stated : "As againat Lal Singh there is evidence of P. 'W. 11 Kartar Singh and P.W. 18 Balwant Singh, Foot Constable that he asked them to disobey their officers and should give up government work. His offence under section 33 of the Ordinance is substantiated. " As we have pointed out earlier, the validity of a. 33 of the Ordinance was not challenged and the only question therefore was whether the third appellant was properly held guilty of the offence. It was not disputed that the two prosecution witnesses 11 & 18 did state on oath the matters referred to by the learned Judge. In view of what we have stated earlier as regards the manner in which this Court deals with appeals under article 136 there is no ground shown for interfering with the conviction of the third appellant or the sentence passed. Before parting with this case it is necessary to advert to one matter. In the course of his arguments learned Counsel for the appellant drew our attention to certain police rules framed 'by the State Government which prohibited policemen from joining unions and sought to raise a point that the said rule was unconstitutional as in violation of Art.19(1)(b) and that II the activities of the four 35 accused were in reality an attempt to form an union and that therefore we should consider the legality of this rule of the police force in considering the propriety of their Convictions. Though there is a reference to the rule in the judgment of the High Court, it is referred to only incidentally and as part of the narrative in detailing the activities of the accused. The offence with which the accused were charged was certainly not the violation of that rule, which if might be pointed out did not create any offence, so that the validity of that rule was wholly irrelevant to their guilt when charged with substantive offences under the various enactments we have noticed earlier. It need hardly be pointed out that the fact that a person is engaged in asserting a fundamental right affords no defence to a charge of having contravened a valid penal statute while so engaged. In the High Court the validity of the police rule was never challenged and in the circumstances we declined to permit learned Counsel to argue any question before us in relation to the validity of that rule. The appeal fails and is dismissed.

Section 3 of the Pepsu Police (Incitement to disaffection) Act 1953, provided: "Whoever intentionally causes or attempts to cause, or does any act which he knows is likely to cause, disaffection towards any Government established by law in India amongst the members of a police 'force, or induces or attempts to induce, 'or does any act, which he knows is likely to induce, any member of a police force to withhold his services or to commit a breach of discipline shall be punishable with imprisonment. " After the administration of the State of Pepsu was taken over by the President under article 356 of the Constitution of India, Parliament enacted a law by which the power of the legislature of the State of Pepsu was conferred on the President. By virtue of this power the President enacted the Pepsu Police (Incitement to Disaffection) Act, 1953, the object of which was to provide a penalty, inter alia, for spreading disaffection among the police. The appellants were charged with having induced or attempted to induce members of the police force to withhold their, services and thus to commit a breach of discipline by staying away without doing their duty, and thereby having committed an offence under section 3 of the Act. They were convicted by the Magistrate and the conviction was confirmed by the High Court. The appellants challenged the validity of the conviction on the ground that section 3 was violative of the freedom guaranteed by article 19(1)(a) of the Constitution and was not saved by article 19(2). Held, that section 3 of the Pepsu Police (Incitement to dis affection) Act, 1953, did not infringe article ' (19)(1)(a) of the Constitution and was intra vires. The Police service is an arm of the State charged with the duty of ensuring and maintaining public order and since any breach of discipline on the part of its members might 26 result in a threat to public order, section 3 must be held to be valid as having been enacted "in the interests of public order" within the meaning of article 19(2). Superintendent, Central Prison, Fatehgarh vs Ram Manohar Lohia, ; , relied on. Held, further, that article 33 of the Constitution was not ;applicable because Parliament had delegated the powers of the legislature of the State to the President and any law enacted by him would not have the force of Parliamentary legislation contemplated by article 33.

No. 435 of 1958. Appeal from the judgment and order dated September 20, 1956 of the Allahabad High Court in special Appeal No. 243 of 1955. Naunit Lal for the appellant. G.N. Dikshit and C. P. Lal for the Respondent. February 8. The following Judgment of the Court was delivered by MUDHOLKAR, J. This is an appeal by certificate from the judgment of the High Court of 107 Allahabad reversing the decision of a single Judge of that Court directing the issue of a writ of Mandamus against the respondents under article 226 of the Constitution. The points which arise for consideration in the appeal are whether the appellant who was at the relevant time the lessee of a right to collect tolls from persons, vehicles etc., crossing the river by public ferry at Pipraghat, District Ballia was bound to allow State carriage buses belonging to the Government of Uttar Pradesh to cross the river by the ferry without collecting any toll or was entitled to claim abatement of rent from the Government under the proviso to s.15 of the Northern India Ferries Act 1878 (hereafter referred to as the Act). In order to appreciate the points a few facts need to be stated. There is a ferry at the village Pipragbat, district Ballia for crossing the river and the right to collect tolls in respect of that ferry is put to public auction annually. The highest bidder at the auction gets the right. The rent or licence fee is collected from him in monthly installments during the year with respect to which the right was purchased by the licensee. The appellant was the highest bidder for the year 1954 and the licence fee payable by him was Rs. 31,751/ . The practice right upto 1954 was to allow the lessee to collect a toll of Rs. 5 1 0 from every stage carriage bus. Till March 9 of that year only privately owned stage carriage buses used to ply on the route in which the ferry crossing was comprised. Thereafter the route has been taken over by the Roadways Department of the State of Uttar Pradesh. From March 9 to March 16, the appellant realised tolls at Rs. 5.1 0 from the State owned stage carriage buses when he was informed by a letter by the first respondent that he should allow the Roadways buses to use the ferry for crossing and recrossing the river on credit till March 31, 1954 and should thereafter submit his bill with 108 respect to the tolls to the Roadways Department of the Government He was also informed that further orders will be issued on April 1, 1954. The appellant accordingly allowed the Roadways buses to use the ferry for crossing and recrossing the river and submitted his bill to the Roadways Department on March 31, 1954. That bill was, however, not paid. On April 1, 1954 he received two communications from respondent No. 1 by one of which hi) was informed that no toll is leviable on the Roadways vehicles and by another he was asked to pay the monthly installment of the licence fee without making any deduction therefore consequent upon the exemption of the Roadways buses from tolls. The appellant had moved the High Court of Allahabad.under article 226 of the Constitution for the issue of a writ directing the respondent "to refrain from precluding the petitioner from charging tolls from the Roadways buses", to issue a writ commanding the respondents to allow abatement to the appellant and to issue an interim direction to the respondents asking them to refrain from realising the unpaid monthly installments of the licence fees till the decision was given. Before the petition was decided the appellant 's licence had run out and, therefore, at the hearing the appellant confined himself to one relief, that is, commanding the respondents to allow rebate one account of the exemption of the Roadways buses from liability to pay the tolls. The petition was, however, not amended. We may incidentally mention that apart from the reliefs above referred to, the appellant claimed two more reliefs, one of which was to pass any such other and further order as may be deemed fit and proper. The learned single Judge of the High Court who decided the petition in the first instance came 109 to the conclusion that the appellant was entitled to abatement of rent under the third paragraph of a. 15 of the Act and directed the issue of a writ to the respondents directing them to " 'perform their statutory duty relating to abatement of rent" payable by the appellant consequent on the exemption of Roadways buses from payment of tolls under the aforesaid provision before claiming or recovering arrears of rent from him. The respondents preferred an appeal under the Letters Patent which was heard by a Division Bench of the Allahabad High Court. The learned Judges held that a licensee is not entitled to abatement of rent unless the Government makes a declaration under s.15 of the Act subsequent to the grant of licence to him. It pointed out that the G.O. No. 1946/17 ,51 dated December 11, 1951 upon which reliance was placed by the learned single Judge being prior in point of time to the grant of the licence to collect tolls to the appellant, did not entitle him to claim abatement. It, however, held that the appellant may be entitled to claim abatement of rent or licence fee under the general law but that such a relief could be claimed only in a suit but not in a proceeding under article 226 of the Constitution. They thus allowed the appeal and dismissed the petition. Section 15 of the Northern India Ferries Act, 1878 runs thus : "Toll., according to such rates as are from time to time fixed by the State Government, shall be levied on all persons, animals, vehi cles and other things crossing any river by a public ferry and not employed or transmitted on the public service: Provided that the State Government may from time to time, declare that any persons, animals, vehicles or other things shall be exempt from payment of such tolls. 110 Where the tolls of a ferry have been let under section 8, any such declaration, if made after the date of the lease, shall entitle the lessee to such abatement of the rent payable in respect of the tolls as may be fixed by the Commissioner of the division or such other officer as the State Government may, from time to time, appoint in this behalf by Dame or virtue of his office. " The proviso to the section confers upon the State Government power to declare from time to time any , persons, animals, vehicles etc., exempt from payment of such tolls. Before the question of allowing abatement of rent or licence fee can arise it must first be established that there was a valid exemption with respect to any vehicles etc., under section 15 of the Act. The section also provides that where such declaration is made subsequent to the grant of licence to collect tolls under section 8 the licensee is entitled to abatement of rent: The Government order to which reference has been made in the two judgments of the High Court runs as follows: "Subject: Exemption from payment of toll. I am desired to say that a question has been raised whether the Roadways Motor Vehicles should be exempt from payment of ferry tolls while crossing any river by a public ferry. Government have given their full consideration to this matter and have come to the conclusion that the motor vehicles run by the Roadways with the operational staff accompanying them on duty fall under the exemption granted from payment of ferry toll in paragraphs 2(a) of notification No. 252/ IX 209/(10) dated March 16, 1925 111 (published on page 347 of the District, Board Manual). 2.lam, however, to observe that the passengers traveling in these vehicles with their goods and all the private goods, being transported in the Roadways trucks shall be liable to the payment of tolls as heretofore according to the rates fixed by the Local Government. 3.The District Magistrate, District Board and ferry contractors in your division may please be informed accordingly. " It may be pointed out that this order, if what appears to be merely a communication addressed to certain authorities can be regarded as a Government order, does not, itself confer any exemption with respect to the buses run by the U. P. Roadways but sets out the opinion of the Government that such buses must be regarded as being exempted under a notification of March 16, 1925 issued under "section 15 of the Act. That notification reads thus: "2. The following shall be exempt from the payment of tolls: (a)All persons animals and vehicles crossing any river by a public ferry when employed or transmitted on the public or District Board service. " Admittedly at that date the State was no running any bus services in the United Provinces (now the State of Uttar Pradesh). May be there were no Government owned buses at all in any other province of India at that time. Moreover it would not be reasonable to assume that a State enterprise of this kind was even in the contemplation of. the LT. P, Government at that time. At that time, apart from running some railways the State had not entered the commercial field. It is in the light of these facts that the language of the notification of March 16, 1925, must be interpreted. 112 What the notification exempts is a vehicle crossing the river on 'public or district board service '. Could it be said that plying motor buses by way of commercial activity is running it on a public service? It is undoubtedly not easy to define what is "public service" and each activity has to be considered by itself for deciding whether it is carried on as a public service or not. Certain activities will undoubtedly be regarded as public services, as for instance, those undertaken in the exercise of the sovereign power of the State or of governmental functions. About these there can be no doubt. Similarly a pure business undertaking though run by the Government cannot be classified as public service. But where a particular activity concerns a public utility a question may arise whether it falls in the first or the second category. The mere fact that activity may be useful to the public would not necessarily render it public service. An activity however beneficial to the people and however useful cannot, in our opinion, be reasonably regarded as public service if it is of a type which may be carried on by private indi viduals and is carried on by government with a distinct profit motive. It may be that plying stage carriage buses even though for hire is an activity undertaken by the Government for ensuring the people a cheap, regular and reliable mode of transport and is in that sense beneficial to the public. It does not, however, cease to be a com mercial activity if it is run with profit motive. Indeed even private operators in order to attract custom are also interested in providing the same facilities to the public as the Government undertaking provides. Since that is so, it is difficult to see what difference there is between the activity carried on by private individuals and that carried on by Government. By reason of the fact that a commercial undertaking is owned and run by the State 113 it does not ipso facto become a 'public service '. It is not disputed before us that the Roadways department of the Government of U. P. is running a profit making and a profitable activity by excluding every kind of competition. In the circumstances, therefore, we find it impossible to hold that its vehicles crossing over ferries can be regarded as crossing on public service. They are, therefore, not entitled to any exemption under the notification of March 15, 192 5. Since they are not entitled to any exemption the question of abatement of rent does not arise. It is true that the petitioner, as already stated, confined himself at the stage of arguments in the High Court to the relief of abatement, because of change of circumstances which took place between the date of filing his petition and its hearing. He did so evidently upon a misunder standing of the legal position with regard to the scope of the notification of March 16. However, the appellant has raised ,in alternative contention in his Statement of the case to the effect that the Roadways buses which carry passengers are used by the Government for carrying on a commercial undertaking and that; there fore they do not come within the exemption made by the notification of the year 1925. In view of this and of the fact that the petition which contains a prayer for grant of ,other relief ' has not been amended and is thus in its original form we see no difficulty in granting appropriate relief to the appellant. In the result we allow the appeal and set aside the judgment of the Division Bench as well as of the single judge of the High Court of Allahabad and direct that a writ in the nature of mandamus shall issue to the respondents directing them to pay to the appellant full tolls with respect to every 114 crossing of the, Roadways buses over the ferry between March 16, 1954, and the date on which the licence in favour of the appellant expired. The costs of the appellant here and in the High Court will be borne by the respondents. Appeal allowed.

The appellant being the highest bidder at a public auction got the right to collect the toll in respect of ferry for crossing the river of Piprighat for the year 1954. The practice upto 1954 was to allow the licensee to collect the toll from every stage carriage bus. Till March of the year 1954 only privately owned stage carriage buses used to ply on the route. Thereafter the route was taken over by the Roadways department of the State of Uttar Pradesh. The applicant was informed inter alia that no toll was leviable on the Roadways Vehicles and was asked to pay the monthly installments of the license fee without making any deduction therefore consequent upon the exemption of the Roadways buses from tolls. The point for consideration inter alia is whether the 106 appellant was bound to allow the state carriage buses of U.P. Government to cross the river by ferry without collecting any toll. Held, that the notification No. 252/IX 209/(10) dated March 16, 1925 exempts a vehicle crossing the river on 'public or district board service ', and it could not be said that plying motor buses by way of commercial activity is running it on a public service. The vehicles of the Roadways department of the Government of Uttar Pradesh crossing over ferries cannot be regarded as crossing on public service. It may be that plying stage carriage buses even though for hire is an activity undertaken by the Government for ensur ing the people a cheap, regular and reliable mode of transport and is in that sense beneficial to the public, but it does not cease to be a commercial activity if it is run with profit motive. The vehicles of the Roadways crossing the river cannot be exempted under the Notification of March 15,1925. Held, further that activities undertaken in the exercise of the sovereign power of the state or of Governmental functions are undoubtedly to be regarded as public services but a pure business undertaking though run by the Government cannot be classified as public service. An activity however beneficial to the people and however useful cannot reasonably be regarded as public service and cease to be a commercial undertaking if it is of a type which may be carried on by private individuals and is carried on by Government with a distinct profit motive. By reason of the fact that a commercial undertaking is owned and run by the State, it does not ipso facto become a "public service".

minal Appeal No. 187 of 1959. 129 Appeal by special leave from the judgment and order dated August 18, 1958, of the Punjab, High Court in Criminal Original No. 20 of 1958. Gopal Singh and P. D. Menon, for the appellants. R. section Gheba, for respondent No. 1. 1962. February 8. The Judgment of Das and Subba Rao, JJ, was delivered by Das, J., Dayal, J. delivered a separate judgment. S.K. DAS, J. This is an appeal by special leave from the judgment and order of the Punjab High Court dated August 18, 1958 by which the said Court found the two appellants guilty of contempt of court and. instead of committing them for such contempt, administered a warning to them and directed them to pay Rs. 50/ each as costs of the respondent Gurbachan Singh. The two appellants before us bear the same name. One of them was the Sub Divisional Officer, Sirsa, District Hisear and the other Naib Tehsildarcum Managing Officer, Sirsa, same district at the relevant time. In this judgment we shall call the Sub Divisional Officer as the first appellant and the Naib Tehsildar as the second appellant. The facts alleged against the appellants were these. One Budh Singh, a displaced person, was allotted some land in village Jagmalera, Tehsil Sirsa, District Hissar. The land allotted to Budh Singh was, it was stated by the appellants, forcibly occupied by the respondent Gurbachan Singh. The respondent was not a legitimate allottee and the appellants, who were concerned in their official capacity with the allotment and management of land for displaced persons, were naturally anxious to oust the respondent and deliver possession to Budh Singh of the land allotted to him. On May 9. 1958 appellant No. 1 made an order that Budh Singh and other allottees like him would be given possession ' of the land, allotted to them. The date fixed for such 130 delivery of possession was May 20, 1958. On May 16, 1958 Gurbachan Singh and a number of other persons who were similarly threatened with dispossession filed petitions to the High Court under article 226 of the Constitution challenging the legality of the action threatened against them. These petitions were put up before the learned Chief Justice on that very day, namely, May 16, 1958, when he issued an order staying delivery of possession till May 19, 1958, when the petitions were to come up for admission before a Division Bench, On May 19, 1958, the Division Bench extended the operation of the stay order until May 23, 1958. In the High Court the appellants did not dispute that the first order staying delivery of possession up to May 19, 1958 was communicated to them on May 19, 1958 on which date the notice from the High Court reached Sirsa. It appears that a notice of the second order extending the stay of delivery possession till May 23, 1958, was not officially communicated to the appellants till May 21, 1958. The allegation on behalf of the respondent was that on May 20, 1958, which was the relevant date, the two appellants were informed by certain interested persons, to whom we shall presently refer, that in extension of the stay order up to May 23, 1958, had been granted by the High Court ' In spite of this information, however, the second appellant, in consultation with and under instruction, of the first appellants formally dispossessed the respondent and handed over possession of the land to Budh Singh. In these circumstances the allegation on behalf of the respondent was that the two appellants bad committed contempt of court by disobeying the order of the, High Court staving delivery of possession till May 23. 1958. The respondent made an application, to the High (court, for taking suitable action against the two appellants. This application was made, oil May 27, 1958. On this application the High Court 131 issued notice and after hearing the parties, Falshaw, J. (as he then was) who dealt with the application came to the conclusion that the two appellants were aware of the order of the High Court extending the operation of the stay order and yet they disobeyed the said order by dispossessing the respondent and handing over possession to Budh Singh. He held them guilty of contempt of court, but at the same time expressed the opinion that the appellants honestly believed that they were not bound to hold their hands in the absence of an official communication of the 'High Court 's order extending the operation of the stay order. In this view of the matter, the learned Judge instead of committing the two appellants for contempt of court merely administered a warning to them and directed them to pay the costs of the respondent. On behalf of the, appellants several points have been urged in support of their contention that they were not guilty of contempt of court. Firstly, it has been contended that on the materials on the record, the High Court was wrong in proceeding on the footing that the two appellants were informed by the interested parties that an extension of the stay order up to May 23, 1958, had been granted in the case of the respondent. It has been argued before us that on May 20, 1958, the appellants did not know that the stay order had been extended till May 23, 1958, in the writ petition filed on behalf of the respondent Gurbachan Singh, though in another case of Didar Singh relating to allotted land in the same village, the appellants were informed by an advocate that the stay order had been extended till May 23, 1958. It has been contended before us that in the absence of positive evidence fixing the two appellants with knowledge of the extension of the stay order in the particular case of the respondent, the High Court was wrong in finding that the two appellants had willfully disobeyed the order of the High Court. 132 In order to appreciate this argument urged on behalf of the appellants it is necessary to state some more facts. In para. 17 of the application which the respondent made to the High Court for taking necessary action against the appellants for alleged contempt of court, it was stated that at 6 30 a.m. on May 20, 1958, two persons named Bir Singh and Avtar Singh went personally to the house of appellant No. 2 and told him that the stay order had been extended by the High Court and that they had been informed by the advocate on telephone. This allegation was supported by an affidavit made on behalf of the respondent. Appellant No. 2, however, denied this allegation in his counter affidavit. In paras. 18, 19 and 20 of his petition the respondent stated that at about 7 40 a.m. on May 20, 1958 a written application was filed before appellant No. 2 in which it was stated that the High Court had stayed delivery of possession till May 23, 1958; this application was drafted by an advo cate named Ganga Bishan, who acted on behalf of Didar Singh. The application was presented to appellant No. 2 in presence of two other persons named Mastan Singh and Teja Singh. Thereafter, an affidavit was also made on behalf of Didar Singh. This affidavit was presented to appellant No. 2 'at about 8.15 a.m. Thereafter, appellant No. 2 went in a 'jeep ' to appellant No. 1 in order to consult the latter. Appellant No. 2 saw appellant No. 1 in the latter 's court room. He came out within a few minutes, and told Ganga Bishan that the affidavit should be presented to appellant No. 1. Thereupon, another application was written on behalf of Didar Singh and this was presented to appellant No. 1 supported by the affidavit already made on behalf of Didar Singh. Appellant No. 1 did not, however, pass necessary orders on the application till about 10 a.m., when he made an endorsement to the effect that the Tehsildar, Sirsa, should take 133 necessary action, When the application was taken to the Tehsildar, he noted on it that the Naib Tehsildar, namely, appellant No. 2 had already left for the village to deliver possession. Thereupon Avtar Singh, Bir Singh, Didar Singh and Mastan Singh went to village Jagmalera where the lands lay and again met appellant No. 2. The application made to appellant No. 1 with his orders thereon was shown to appellant No. 2. It was alleged that appellant No.2 was also shown the wording of the stay order as received by_ the party through a special messenger. Appellant No. 2, however, replied that he had been ordered to dispossess the respondent and insisted on his proceeding with the dispossession. In his counter affidavit appellant No. 2 admitted that on May 20, 1958 an application was presented to him by Didar Singh at about 7 40 a.m. He further admitted that an affidavit in support of the application was also presented to him. Appellant No. 2 then made the following significant statements. "On receipt of these documents I told Shri Didar Singh that I could not act on the application and suspend the proceedings for dispossession unless I was shown the order of stay alleged to have been made by the High Court. " Appellant No. 2 explained his conduct by referring to the background of quarrel and enmity between the parties which had led to several criminal cases between them. Appellant No. 2 said in his counter affidavit that with this background of enmity he felt that though Didar Singh was an interested party, it would not be safe to accept the statements of facts contained in the application or affidavit made on behalf of Didar Singh at their face value. Appellant No. 2 also admitted that he consulted appellant No. 1, who also advised that it would not 134 be safe, to act on the statements made in the application or affidavit. Appellant No. 2 also admitted that Ganga Bishan Advocate, presented the applications to him. He also admitted that the application which was filed by Ganga Bishan to appellant No. 1 was received back with the orders of appellant No. 1 thereon at about 6 p.m. on May 20, 1958, while appellant No. 2 was returning from the village. Appellant No. 2 denied that he was shown the wording of the stay order of the High Court. He admitted, however, that he was asked not to proceed with delivery of possession on account of the High Court. Appellant No. 1. also made similar statements in his counter affidavit. He admitted that at about 9 a. m. on May 20, 1958 an application supported by affidavit was made to him on behalf of Didar Singh and be then endorsed the application to the Tehsildar for necessary action. Unfortunately, the applications which were made to appellants 1 and 2 have not been filed and we do not know the precise contents of the two applications. We have, however, affidavits made on behalf of Didar Singh, Teja Singh, Ganga Bisban and Avtar Singh. The learned Advocate for the parties have taken us through those affidavits. The argument presented on behalf of the appellants is that though they knew of the extension of the stay order in Didar Singh 's case by reason of the application and affidavit filed on his behalf before them, they did not know that a similar extension of the stay order had been granted by the High Court in the other cases as well. This argument has been pressed before us with some vehemence and we proceed now to consider it. It is worthy of note that such an argument which goes to the very root of the matter was not presented to the High Court. It is not disputed that ",disobedience of a judgment or order requiring a person to do any act other than the payment of money, or to 135 abstain from doing anything is a contempt of court punishable by attachment or committal" ; but disobedience, it is argued, if it is to be punishable as a contempt, must be willful ; in other words, the party against whom a proceeding by way of contempt is taken must know that order before, it can be said that he has disobeyed it. It is somewhat surprising that if the stand of the appellants was that they did not know of the order made by the High Court on May 19, 1958, in the respondent 's case, such a point was not urged in the High Court. Falshaw, J., (as he then was) said in his judgement that it was not in dispute before him that on the morning of May 20, 1958, both the appellants were informed that an extension of the stay order upto May, 23, 1958, had been granted by the High Court. This state ment of the learned Judge must have reference to the case of the respondent which he was considering. Apart, however, from the point that, such an argument on behalf of the two appellants was not presented in the High Court, it appears to us that on the affidavits made available to the Court, the only reasonable inference is that though the application and the affidavit were made on behalf of Didar Singh, both the appellants were informed that the High Court had granted an extension of the stay order in all 4 he cases. It is admitted on both sides that there were three cases in which delivery of possession had to be given of lands in village Jagmalera. It is also not seriously in dispute that on May 9, 1958, appellant No. 1 made an order directing that delivery of possession should be given to the allottees of their respective areas and persons in unauthorised occupation would be dispossessed. On May 16, 1958 three writ petitions were made which were placed before the Chief Justice who made an interim order of stay lasting for three days. On May 19, 1958 the writ petitions were placed before a Division Bench for admission and that Bench 136 extended the stay order till May 23, 1958. These are the admitted facts. It is also, admitted that the respondent Gurbachan Singh did not appear before the appellants on May 20, 1958, a fact which has been emphasised by the learned Advocate for the appellants. Lot us, however, see what the affidavits filed in the case show. Teja Singh said in his affidavit that Harbans Singh Gujral, who was the advocate acting on behalf of the petitioners in all the, cases, told him on the telephone on May 19, 1958 that the High Court had extended the stay order in all the cases upto May 23, 1958. Teja Singh accompanied Didar Singh, Ganga Bishan, Mastan Singh and others to the village on May 20, 1958, and he said that an application was made to appellant No. 2 in which it was stated that the stay order had been extended by the High Court. The affidavit of Ganga Bishan is very significant in this connection. He said that on May 20, 1958, he drafted the application which was later made to appellant No. 2. Ganga Bishan said that it was stated to appellant No. 2 that the stay order made by the High Court related to all the cases of village Jagmalera. He further said that appellant No. 2 was informed that stay of delivery of possession had been extended by the High Court upto May 23, 1958 ; appellant No. 2, however, wanted to be ,shown the order of the High Court ; thereupon an affidavit of Didar Singh to the effect that the stay order had been extended by the High Court upto May 23, 1958, was filed. Ganga Bishan also said that appellant No. 1 was also informed that the High Court had extended the stay order upto May 23, 1958. The affidavits made on behalf of Didar Singh and Avtar Singh were also to the same effect. In view of these affidavits we find it very difficult to hold that the. appellants knew of the stay 'order only in Didar Singh 's case but did not know of the stay order in the other oases. It is worthy of note here that 137 in the counter affidavits filed on behalf of the appellants the point was made on their behalf was that they considered it unsafe to rely on the applications and affidavits made, in view of the background of enmity between the parties. The two appellants did not say in their counter affidavits that they came to know of the stay order only in one case and not in the others such a point does not appear to have been specifically made on behalf of the appellants at any stage of the proceedings in the High Court. Therefore, we have come to the conclusion that the appellants knew of the order of the High Court in all the cases and it is not correct to say that the appellants knew of the order of the High Court only in one case and not in the others. We find it difficult to believe that Ganga Bishan would not tell the appellants that the High Court had extended the stay order in all the three cases of the village Ganga Bishan says in his affidavit that he did tell the appellants of the extension of the stay order in all the three cases and there was no counter affidavits on behalf of the appellants traversing the statements made by Ganga Bishan. We must, therefore, overrule the first point urged on behalf of the appellants. The second point which has been urged on behalf of the appellants is that in the absence of an official communication of the order, they were justified in not acting on what they came to know from interested parties and their advocate. The learned Advocate for the appellants has submitted that in a case of this nature, before willful disobedience of the order of the High Court could be imputed against the appellants, it was legally essential that the order should be officially communicated or served on the appellants and in the absence of such communication or service, the proceeding for contempt must fail. We are unable to accept this contention as correct. 138 The legal position has been very succinctly put by Oswald: "The judgment or order should be served on the party personally, except in the following cases: (1) prohibitive orders, the drawing up of which is not completed; (2) orders em bodying an undertaking to do an act by a named day; (3) orders to answer interrogatories or for discovery or inspection of documents: (4) where an order for substituted service has been made; (5) where the respondent has evaded service of the order. In order to justify committal for breach of a prohibitive order it is not necessary that the order should have been served upon the party against whom it has been 'granted, if it be proved that he had notice of the order aliunde, as by telegram. or newspaper report, or otherwise, and knew that it was intended to be enforced, or if he consented to the order, or if he was present in Court when the order was pronounced. , or when the motion was made, although he left before the order was pronounced. " (Oswald 's Contempt of Court, 3rd Edn. 199 and 203). The order in the present case was a prohibitory order and if the appellants knew that the High Court had prohibited delivery of possession till May 23, 1958, it was undoubtedly the duty of the appellants to carry out that order. We do not think that the appellants can take up the plea that as the order had not been officially communicated to them, they were at liberty to ignore it. The appellants were officers whose duty it was to uphold the law and if they knew that a valid order had been made by the High Court staying delivery of possession, they disobeyed that order at their peril. There may be circumstances where officials 139 entrusted with the duty of carrying out a legal order may have valid reasons to doubt the authenticity of the order conveyed to them by interested parties and in those circumstances it may be said that there was no willful disobedience of the order made. We do not, however, think that the appellants in the present case had any real justification for doubting the authenticity of the order made by the High Court, even though the order had not been officially communicated to them. The appellants knew that an interim order of stay had been made by the High Court on May 16, 1958; that order was in force till May 19, 1958. Thereafter the appellants were informed not merely by interested parties but by an Advocate, who was an officer of the Court, that the High Court had extended the stay order upto May 23, 1958. A formal application supported by an affidavit was made to that effect. Despite the reason alleged by the appellants that there was a background of enmity between the parties, we do not think that the appellants have given any good reasons on which they were entitled to doubt the authenticity of the order communicated to them by Ganga Bishan, an Advocate acting on behalf of Didar Singh. It is worthy of note that the appellants did not deliver possession in Didar Singh 's case. They were content with delivering possession in the case of the respondent only. Taking into considerations all these, circumstances we are satisfied that there was in this case in the eye of the law, a willful disobedience of the order of the High Court staying delivery of possession, even though the appellants might have wrongly but honestly believed that it was not safe to act on the information given to them by Ganga Bishan. The learned Advocate for the appellants has referred us to a number of decisions, English and Indian, relating to mandatory orders, or 140 orders for the payment of money, or orders which require under the rules of the Court to be served in particular manner. In re: Holt (an Infant)(1); Ex parte Lingley (2); In re: Tuck March vs Loosemore (3); Dwijendra Krishan Datta vs Surendra, Nath Nag Choudhury (4): and Gordon vs Gordon (5). In those decisions it was held that it was necessary to have the order properly served before charging a person with disobedience of it. We do not think that those decisions are in point, because we are dealing with a prohibitory order and in the matter of a prohibitory order it is well settled that it is not necessary that the order should have been served upon the party against whom it has been granted in order to justify committal for breach of such an order, provided it is proved that the person complained against had notice of the order aliunde. The distinction between prohibitory orders and orders of an affirmative nature was adverted to in N. Baksi vs O. K. Ghosh (6) and a large number of decisions were referred to in support of the rule that in respect of a prohibitory order, service of the order was not essential for founding an action in contempt. We do not think that any useful purpose will be served by examining those decisions over again. We are content to adopt for the purposes of this case the rule as succinctly put by Oswald and quoted earlier in this judgment. Lastly our attention has been, drawn to the statements made by the respondent in para. 22 of his petition to the effect that though appellant No. 2 made a report about delivery of possession in respect of the land of the respondent, no actual dispossession could be made because cotton crop was standing on the land and a large number of persons had gathered there. The argument before us is that if, according to the respondent (1) (3) (5), (1946) 1 AU E.R. 246. (2) (4) A.I.R. 1927 Calcutta 548. (6) A.I.R. 1957 Patna 528, 141 himself, no actual dispossession took place then this is not a fit case in which action for contempt should be taken against the appellants. It has been submitted on behalf of the appellants that contempt proceedings are of an extraordinary nature and the Court should be reluctant to exercise its extraordinary power if the action complained of is of a slight or trifling nature and does not cause any substantial loss or prejudice to the complainant. It has been argued that if the respondent himself said that he had not been actually dispossessed, then there was no reason for proceeding against the appellants for contempt of court. Secondly, it is pointed out that the appellants offered an apology in case the High Court held that they should have taken action on the information given to them by Ganga Bishan. As to the second submission, it is enough to point out that in a matter relating to contempt of court, there cannotbe both justification and apology, (See M. Y.Shareef vs The Hon 'ble Judges of the High Courtof Nagpur (1). As to the first submission wemay draw attention to the statements of appellant No. 2 in para. 21 of his affidavit in which he said that so far as the respondent 's land was concerned, possession was delivered to Budh Singh. This statement of appellant No. 2 clearly shows that the two appellants took the very action which was prohibited by the High Court by its order dated May 19, 1958. We are, there fore, unable to accept the submission that there was no foundation for taking action against the appellants for contempt of court. This disposes of all the points urged on behalf of the appellants. As to the punishment imposed, the learned Judge took into consideration that the appellants wrongly but honestly might have believed that they were not bound to hold their hands in the absence of an official communication of the order (1) ; 142 of the High Court. That belief afforded no defence to the charge of contempt of court, but was a consideration relevant to the sentence. In our opinion, there are no grounds for interference with the order of the High Court. The appeal accordingly fails and is dismissed. RAGHUBAR DAYAL, J. I have bad the privilege of perusing the, Judgment of my learned brother section K. Das, J., but regret My inability to hold that the appellants committed contempt of Court. I need not repeat the facts set out in the majority judgment. No conviction for committing contempt of Court can be based on the finding of the High Court that the appellants delivered possession believing that they were not bound to hold their hands in the absence of the official communication of the High Court 's order. The finding means that they delivered possession not in defiance of the High Court 's order, but because they honestly thought that in the absence of the official communication of the order, they could not act on the supposition that the original stay order, which was to be effective up to May 19, 1958, continued to be effective. If in their honest opinion no stay order existed at the time, their conduct cannot be said to amount to willful disobedience of the High Court 's order extending the stay order up to May 23, 1958. No question of willful disobedience can arise when the very existence of the order is not believed. The question of obedience or disobedience arises only after the party knows of the order and if the party does not know the order, no such question can arise. The allegations in the petition by the first respondents filed in the High Court, did not make out that the appellants delivered possession, the 143 delivery of which had been stayed upto May 23, 1958, by the High Court by its order dated May 19, 1958. This is clear from the statements in paragraphs 21 and 22 of the petition. They are : " 21. However when actually he attempted to start the work of dispossession, he found that a large number of people were collected at the spot and apprehending that the police force already taken to the spot might not be sufficient to cope up with the situation if some trouble arose, he withdrew from the spot. 22.That although in the land possessed by the petitioner in Jag Malera, cotton crop was standing in some of the fields and no proceedings for dispossession of the petitioner could be taken by respondent No. 2 on account of the presence of a large number of persons at the spot, respondent No. 2, however, madesome report later on that the petitioner hadbeen actuary dispossessed of his lands and the same was given over to Budh Singh at the spot. In the other cases, however, he made a report that be could not deliver possession on account of the presence of a mob at the spot and that the police force with him being too small, was not sure to cope up with the situation. " These paragraphs can only mean that appellant No. 2 attempted to start the work of dispossession, but did not proceed further, and withdrew from the spot in view of an apprehension of breach of peace and that be made some report of a fictitious kind to the effect that the petitioner had been actually dispossessed of his land and possession had been given over to Budh Singh at the spot. It Was emphasized that actual possession could not have be on delivered on account of the standing cotton crop. It follows that even on the statements 144 of the first respondent in his petition for action against the appellants for contempt of Court, there was no assertion that they had disobeyed the stay order by delivering possession to Budh Singh. In the absence of such an assertion, no action could have been taken or ought to have been taken against the appellants. Contempt proceedings are criminal or quasi criminal proceedings. It is essential that the accusation made against the opposite party by the petitioner for taking action against him should be precise and should ,clearly make out that the opposite party had, by some specific act, committed contempt of Court. the conviction of the opposite party must rest on the facts alleged and proved by the petitioner. A conviction may also rest on the sole admission of the alleged condemner if that establishes his committing contempt of Court, but, in that case, his admission should be taken as a whole and not that its incriminating part be taken out of the context and made the basis for conviction. It is immaterial that appellant No. 2 stated in his reply that actual possession of the land in the unauthorised possession of the first respondent was delivered to Budh Singh and that at the time no cotton crop was standing and that the respondent was adopting a contradictory position. The High Court did not give any finding on this question. It simply said in its judgment, due to the misreading of the allegations in the petition. "In spite of this fact it is alleged that in the village the Naib Tehsildar formally dis possessed ' the present petitioner and handed over his land to one Budh Singh. " The respondent made no statement about the Naib Tehsildar formally dispossessing him and banding over the land to Budh Singh. 145 A clear cut finding on the disputed fact whether actual possession had been delivered or not is not to be given in summery proceedings for contempt of Court. If actual possession had been delivered to Budh Singh, there must have been some good reason for the respondent not to admit it in his petition and that can only be that in any future dispute where the question of possession of the respondent or of the Budh Singh be in question, the respondent be not confronted with his own admission in his petition and affidavit accompanying it. It may be mentioned that identical statements where made in paragaraphs 21 and 22 of the affidavit. There might be some other reason for the respondent not to admit the delivery of possession, but it is clear that the respondent did not come to Court with clean hands and, in the circumstances, proceedings for contempt of Court on his application was wrong exercise of discretion. However, the main fact remains that no allegation was made in the petition that the respondents had delivered possession. The appellants were not served, by the time the delivery of possession may be supposed to have taken place, with the order of the High Court extending the stay, order up to May 23, 1958. The telegram sent by the counsel of Gurbachan Singh from Chandigarh, reached the first appellant, the Sub Divisional Officer, at 1 30 p.m., on May 10, 1958, and any order of his on it did not reach appellant No. 2 till 6 p.m., by which time, according to him, possession had been delivered. The formal stay order from the High Court reached much later. It may not be necessary to serve prohibitive order on the party against whom it is granted, but that party must have notice of the order before it can be expected to obey it can be committed for contempt of Court for disobeying it. This is what 146 Oswald states at page 203 of his book on 'Contempt of Court ', III Edition. He says: "In order to justify committal for breach of a prohibitive order it is not necessary that the order should have been server upon the party against whom it has been granted, if it be proved that he had notice of the order aliunde, as by telegram, or newspaper report, or otherwise,. " It would appear from the later part of the observation that it was sufficient that the party concerned gets notice of the prohibitive order by any means, specially by telegram or newspaper report. is however not what was held in the cases referred to by Oswald in support of his statement. Notice to the party concerned, of the prohibitive order, in those cases was communicated by the Court through its regular procedure or by a Solicitor of the Court. In In re Bryant (1) the parties concerned wet,(, informed by the solicitor of the judgment debtor that the debtor had filed a liquidation petition in the London Bankruptcy Court and that application would be made at the next sitting of the Court to restrain further proceedings under the execution. The auctioneer concerned received a telegram from Bryant 's solicitors referring to the parties to the case and stating that injunction staying sale and further proceedings Lad been granted that morning and that the order would be served as soon as possible. The auctioneer, how ever, proceeded with the sale. It was in these circumstances that the parties concerned were held to have disobeyed the order of the Court and to have committed its contempt. The solicitor was an officer of the Court. This case is no authority for the proposition that information conveyed to the party concerned (1) I.R. 147 by telegram from a person who is not an officer of the Court would amount to the requisite notice of the prohibitive order by the party concerned. In Ex parte Langley, Ex parte Smith, In re Bishop (1) the facts were as follows. Bishop filed a liquidation petition in the London Bankruptcy Court on August 6, 1879. The same day the Court passed an order restraining until the 8th of September, further proceedings in several actions which had been commenced against the debtor and, inter alia restraining the sheriff of Kent, his officers and servants, from taking any further proceedings in an action which had been brought against the debtor by Messrs. Wade and Thurston. The sheriff had fixed the sale of the attached furniture of the debtor on the 6th of August, having adjourned it from the 5th in order to afford an opportunity to the debtor to pay the debt. Smith was he sheriff 's officer who was in charge of the sale. His assistant, Emmerson and Langley, an auctioneer, were to carry out the sale. Emmerson had directions to start the sale at 11 'clock and not a moment later. Langley, however, postponed the same to 12 o 'clock, on his own responsibility, due to paucity of persons present. Langley received a telegram from one Matthews, the manager of the hotel in which the debtor was carrying on business as a licensed victualer, saying: "Smith gone to Canterbury. You had better stop Bale on your own account, as I know it is all right. " The auctioneer was also informed by the debtor 's son and another person between 11 and 12 o 'clock that the debtor would come down by the mid day train from London with the money to pay the execution debt. The sale was again put off to 1 o 'clock when it did start. After a few lots had been sold, Emmerson received a telegram purporting to be (1) L.R. (1979) 13.Ch. D. 110 148 from Learyod & Co., Solicitors, London, to the sheriff 's officer in possession stating: "Take notice, the London Court of Bankruptoy has made an order restraining you from selling or taking any further proceedings in the action against Bishop". The telegram was shown to Lanoley who thought it to be a ruse on the part of the debtor but was prepared to stop the sale temporarily till instructions from Smith. Emmerson sent a telegram to Smith saying: "Langley just received telegram to stop sale. Shall we proceed? People are waiting your reply. " Smith 's reply was: "If telegram to Langley does not state Defendant filed petition or money paid, sell at once" ' The sale thereafter proceeded. Langley and Smith were committed for contempt by Bacon C J. But on appeal they were acquitted. James, L. J., said at page 116: "With regard to the sheriff 's officer, he does not seem to have been a party to the alleged contempt at all, because I do not think the mere fact of the telegram is sufficient to bring home to him any Participation in the supposed contempt." He further said at page 117, in considering the case of the auctioneer. "It appears. to me that he might have taken some steps (though I do not know what steps I should have taken if I bad been in his position) to ascertain whether an order had really been made by the Court. Perhaps some auctioneers would have done so. But he has taken upon himself to swear positively (and he 149 has not been cross examined) that which Lord Eldon, in Kimpton vs Eve ; , field to be sufficient. He swears that he did not believe that there had been any proceedings whatever in the Bankruptcy Court it, or that any such order had been made. A person in I such a position, and a sheriff 's officer is placed in great difficulty upon receiving a telegram of this kind, knowing nothing at all of the person who may have gone to the post office and sent it, a telegram which might just as well have been sent by the debtor or by Matthews, or any one else on behalf of the debtor, in the name of Messrs. Learoyd. I am very far from saying that notice of an order cannot be given by telegram. But it is very difficult to commit for contempt where a man says that which the auctioneer does here, under circumstances which certainly give color to his assertion, and there is some amount of probability that he may, having regard to what had already taken place that ay, not have believed that any order had been made by the Court, and have had no suspicion whatever that he was disobeying any order of the Court when he continued the sale. " Thesinger, L. J., said at p. 119: I in no way dissent from the proposition laid down by him(Bacon, C.J.) in this case and also in In re Bryant (supra), that, under certain circumstances, a telegram may constitute such a notice of an order of a Court as to make a person who disregards the notice and acts in contravention of the order, liable for the consequences of a contempt of Court. .But the question ineach case, and depending upon the particular circumstances of the case must be or was there or was there not such a notice given to the person who is charged with 150 contempt of Court that you can infer from the facts that he had notice in fact of the order which had been made? And, in a matter of this kind, bearing in mind that the liberty of the subject is to be affected, I think that those who assert that there was such a notice ought to prove it beyond reasonable doubt." He further stated at page 121: "But, on the other hand, he has positively sworn that, coupling what had happened before with the telegram, he bona fide believed that he was not bound to act upon the telegram which he had received, and that there had been no proceedings which would justify him in stopping the sale. He has not been cross examined, and nothing has been proved to show that his affidavit is not true. Under such circumstances the observations of Lord Eldon, in Kimpton vs Eve (supra) seem to me pertinent and material, and I may add that in a case like the present the benefit of any doubt ought to be given to the person charged with contempt. " The further remarks of James L. J., at page 122 point out the proper way of communicating a notice about injunction orders to the parties concerned by the solicitor of the party obtaining the order from the Court. He says: "I wish to add this, that when parties who .obtain an injunction wish to communicate it by telegram, there is a very obvious mode by which they can prevent difficulties like this. If the solicitor, instead of telegraphing to the sheriff 's officer, were to telegraph to some solicitor as his agent at the place, and tell him to go and give notice of the order, then the person affected would have the responsibility 151 of an officer of the Court for what he was doing. " This case well illustrates the difficulties of the parties against whom a prohibitive order is made when they are informed by a telegram about these orders having been made by the Court oven when the telegram was from a solicitor of the Court. The difficulties would be still greater if the telegram was one from a; person who is not a solicitor and therefore an officer of the Court. In The Seraglio(1) notice of the issue of warrant which was subsequently disobeyed was sent by telegram by the marshal to the customhouse officer at Plymouth who went on board the seraglio to inform those in charge of the ship. The master of the Seraglio, however by the owner 's order, left Plymouth with the custom house officer on board. The warrant was served on him subsequently. Sir James Hannon said at page 121. "It must be understood that a litigant cannot be disregard a notice sent to him by telegraph by an officer of the Court. " In none of the cases referred to, a party 1s said to have received information of the Court 's injunction order through any source having no connection with the court Passing the order. I would not like an extension if this, practice of holding a person guilty of contempt even though he is not served with the order, to cases in which his alleged knowledge of the order is dependent on the veracity of the witnesses examined by a party praying for action against the other. Conviction for contempt of Court must depend on unimpeachable evidence of the knowledge of the alleged contemner about the order said to have been disobeyed. In support of the note that it could be proved that the party proceeded against had notice of the (1) 152 order by newspaper report or otherwise, Oswald has referred to Daniell 's Chancery Practice, Vol '. 1, Edition 7, page 1368. That edition is not available, but in the 8th edition of that book, Vol. II, at page 1413, is noted the practice in urgent cases thus : "In such (urgent) cases, the practice is to serve the party enjoined personally with notice in writing that the injunction has been granted, and that the order will be drawn up and served as soon as it can be passed through the offices ; or else to procure a transcript of the minutes of the order signed by the Registrar, and to serve the same personally by delivering a copy of it, showing at the same time the original transcript so signed ; and either the notice or the copy of the minutes will be sufficient to render the defendant or other person enjoined guilty of a contempt, if he acts in opposition to the injunction. " I do not find any reference that knowledge of the party proceeded against through a newspaper report or otherwise, and not through Court, has been considered sufficient for contempt proceedings. Again, at page 1419, have been mentioned certain other means through which the party proceeded against could have been informed of the injunction order. They are practically those summarized in Oswald 's note. In the appeal before us, I am not satisfied that the appellants had been informed that the High Court had passed an order staying the delivery of possession in proceedings on the writ petition filed by respondent Gurbachan Singh. The communication made to the appellants about the stay order of the High Court is said to be through the applications and affidavit presented by Didar Singh to the appellants on May 20, 1958, and through a 153 chit said to have come from the advocate of the High Court regarding the injunction order. Didar Singh had put in another writ petition against his threatened dispossession by appellant No. 1 through appellant No. 2. There is said to have been ' a third writ petition by another person praying for similar relief. All these petitions were separately dealt with by the High Court. Separate stay orders were passed on them. These five affidavits, in view of their contents, are not sufficient to prove that the appellants had been informed through these documents that the High Court had extended the stay orders in all the three cases. viz., the cases on the writ applications of Gurbachan Singh, Didar Singh and another third person. No statement is made in any of the affidavits that the applications and affidavits presented to the appellants mentioned that the High Court had stayed the delivery of possession in all the three cases. It is not stated by Didar Singh and Mastan Singh what was written on the chit sent by the advocate of the High Court and whether that chit related to the order in the case of Didar Singh alone or referred to the orders in all the cases. As Didar Singh claimed a receipt for the presentation of the application and affidavit to appellant No. 2, the latter, after consulting the prosecuting inspector, went to appellant No. 1 for consultation and was advised to, return the application to Didar Singh if he insisted on getting a receipt. The application and the affidavit were therefore then returned to one Ganga Bishan. The chit alleged to have been sent by the High Court advocate has not been produced. The application presented to appellant No. 2 in the village and returned by him in the Sub Divisional Officer 's Court, though presumably in possession of Didar Singh, has not been filed. They would have indicated what their contents were. That 154 would have been the best evidence of what was conveyed to appellants Nos. 1 and 2. Ganga Bishan 's statement. that he had drafted the application addressed to appellant No. 2 to the effect that the stay order issued by the High Court in Jag Malera Namdhari cases had been extended, is not the best 'evidence of what the application (a fair copy presumably), actually contained, an application which is in the possession of Didar Singh. Of course, the application and affidavit presented to the Sub Divisional Officer, are in the possession of the State. No attempt was made by the respondent to summon them or to file certified copies of those documents in these proceedings in the absence of the best evidence, the documents, I am not prepared to hold that the application and affidavit filed by Didar Singh must have referred to all the cases. Normally, he had no business to refer to the stay orders in the other cases and to make prayer for the stay of delivery of possession in all the cases. He had to restrict his application and affidavit to his own case. Further, whatever was stated in the application and the affidavit,, in the nature of things, was not on the basis of personal knowledge of Didar Singh Didar Singh himself did not even have the telephonic communication with his counsel at Chandigarh. The telephonic communication was between Teja Singh and that counsel. Appellant No. 2 states and I see no reason to doubt that statement that in the background of the facts about the possession over the land he did not consider it advisable and safe to accept the statement of facts contained in the application or affidavit on its face value. Lastly, the presence of Ganga Bishan, Advocate, on the occasions of the presenting of the application and affidavit to appellants Nos. 1 and 2, is 155 stated in all the affidavits. But it is only in paragraph 5 of Didar Singh 's affidavit that it is stated that Babu Ganga Bishan, Advocate, presented the application and the affidavit to the Sub Divisional Officer. Ganga Bishan himself does not state so. It is not stated anywhere that Ganga Bishan had been engaged as counsel by Didar Singh. It would appear a bit unusual that 'in the presence of a duly appointed advocate, applications and affidavits be presented by Didar Singh personally and not through his counsel. On the basis of the statements and the affidavits, I am not prepared to hold that Galiga Bishan was the duly appointed counsel for Didar Singh. He may be accompanying Didar .Singh like other persons on account of his interest in the matter. Further, any request by him to the Sub Divisional Officer for passing the necessary orders on the application of Didar Singh, as stated by him in paragraph 3 of his affidavit, cannot lead to the conclusion that be professionally represented Didar Singh, as similar requests were made, according to his own affidavit, by the other persons also, who had accompanied Didar Singh to the Sub Divisional Officer 's Court. The Sub Divisional Officer, therefore, could not have treated his request to be a statement of fact about the High Court 's extending the stay order up to May 23, 1958. Ganga Bishan does not state that he told the Court that the High Court had extended the duration of the stay order or that he requested the Sub Divisional Officer, who is also the Sub Divisional Magistrate, to stay the delivery of possession in view of the application filed by Didar Singh. He simply states: "Several requests were made to the Sub Divisional Magistrate by us that necessary orders on the application presented to 156 him be made and the Managing Officer be called back." Even if Ganga Bishan bad stated that the High Court bad extended the order, his statement too, had no better value when he could not speak about that order on the basis of personal knowledge or on the basis of any communication to him by the Advocate of the High Court. He has not stated in his affidavit that he was present when the order was passed or that he had received any communication from the High Court Advocate. I am therefore of opinion that his merely accompanying Didar Singh and others did not invest any greater weight to the correctness of the statements made in the application and the affidavit. The public officers are not to blame if they do not take at face value what is contained in deliberately prepared applications and affidavits. I have already mentioned of the way in which the crucial basic fact to be mentioned in the petition for contempt proceedings against the appellants had not been mentioned and statements were made in a way which at first sight could lead to the impression that the delivery of possession had been made in defiance of the order of the High Court. I am therefore of opinion that it is not established the respondents did not rely on the statements in the application and the affidavit mala fide because they were bent upon delivering possession in defiance of the orders of the High Court. I find in this case that on May 16, orders of the High Court were obtained for serving the stay order upon the appellants through the petitioner respondent, but no such order was obtained for serving the order dated May 19. In view of the urgency of the matter, the respondent and others who bad obtained extension of the stay orders on 157 the 19th could have and should have obtained similar orders of the High Court for serving them. If that precaution had been taken %gain on May 19, 1958, probably what happened subsequently on the spot and thereafter, would not have taken place. I am therefore of opinion that the appellants committed no contempt of Court, and would allow their appeal. By COURT : In accordance with the opinion of the majority, the appeal fails and is dismissed. Appeal dismissed.

The appellants, one a Sub Divisional Officer and the other a Naib Tehsildar, were entrusted with the duty of allotting land to displaced persons. The first respondent forcibly occupied the land allotted to B. On May 9, 1958, the first appellant ordered that B and other allottees similarly situated would be given possession of lands allotted to them on May 20, 1958. On May 16, 1958. the first respondent and others threatened with dispossession filed petitions in the High Court under article 226 of the constitution and obtained interim stay of delivery of possession till May 19, 1958, when the petitions would come up before the Division Bench for admission. On May 19, 1958, the Division Bench extended the operation of the stay order until May 23, 1958. The notice of the first stay order reached the appellants on May 19, 1958, but no notice of the second order was officially communicated to them till May 21, 1958. It was alleged that on May 20, 1938, the appellants, although informed of the second stay order by certain interested persons and the Advocate for one of the parties, formally dispossessed the respondent in disobedience of the Court 's order and handed over possession of the land to B. On the complaint of the respondent the High Court field that the .appellants were guilty of contempt of Court and, instead of committing them for contempt, administrated a warning as the appellants honestly believed that they were not bound to stay delivery of possession in absence of an official communication. The appellants appealed by special leave. Held, (per Das and Subba Rao, JJ.)that in a case of contempt for disobedience of a prohibitive order, as distinguished from an order of affirmative nature, it was not necessary to show that notice of the prohibitory order was served upon the party against whom it was granted. It would be sufficient if it was proved that the party had notice of it aliunde. N.Baksi vs O. K. (Thosh, A. T. R. (19.)7) Patn. 528, referred to. 128 There may be circumstances where officials entrusted with the carrying out of a legal order might have valid reasons to doubt The authenticity of the order conveyed to them by interested parties. But in the present case there could hardly be any such reasons. The appellants had really no justification for doubting the authenticity of an order communicated to them by an Advocate. Held, further. that in a matter relating to contempt of court, there cannot be both justification and apology. shareef vs The Hon 'ble Judges of the High Court of Nagpur; , , referred to. Although the appellants might have honestly believed that they were not bound to bold their band in absence of an official communication, that would be no defence to the charge of contempt of court, but only a relevant consideration in awarding the sentence. Per Daval, J. Contempt proceedings are criminal or quasi criminal in nature and it is essential that before any action can be taken the accusation must be specified in character. In the instant case, the respondent did not state that he was formally dispossessed. This would 'be for some reason if actual posssssion had been delivered. He could not be said to have come to court with clean hands. Further, the finding of the High Court that the appellants delivered possession honestly believing that they were not bound not to do so in the absence or the official communication meant that there was no defiance of the High Court 's order. There could be no willful disobedience since there was no belief in the existence of the order. It may not be necessary that the party against whom a prohibitory order was made must be served with the order, but it should have notice of the order before it could be expected to obey. Such notice must be from sources connected with the court passing the order. The alleged knowledge of the party cannot be made, to depend on the veracity of the witnesses examined by the party praying for action. In re Bryant L.R (1987 6) In Ex Parte Langly, Exparte Smith. In re Bishop L. R. and The Seraglio. L. R. , discussed.

l Appeals Nos. 67 to 75 of 1959. Appeals by special leave from the judgment and order dated May 7, 1954 of the U.P. Board of Revenue, in Second Appeals Nos. 53 to 61 of 1945 46. section P. sinha, J. P. Goyal and Sadhu Singh, for the appellants. Bishan Narain and E. L. Mehta, for the respondents. February 15. The Judgment of the Court was delivered by RAGHUBAR DAYAL, J. These nine. appeals, by special leave, are against the orders of the Board of Revenue, Uttar Pradesh, dismissing nine 219 second appeals filed by the appellants in circumstances hereinafter, mentioned, on the ground that the orders of the First Appellate Court in three other connected first appeals had become final and operated as res judicata. Khub Chand had three sons Karan Singh, Hoshiar Singh and Mukhtiar Singh. Each of these brothers instituted four suits. Hoshiar Singh instituted suit No. 48 of 1944 under section 175 of the U.P. Tenancy Act, 1939 (U.P. XVII of 1939), against one Bhartu, suit No.49 against Har Gyan, Mukhtiar Singh and Data Ram, sons of Sis Ram, brother of Bhartu, suit No.50 against Har Gyan and Mukhtiar Singh, sons of Sis Ram, and suit No. 51 against one Banwari. Karam Singh similarly instituted suits Nos. 63, 61, 60 and 62 against similar defendents respectively. Mukhtiar Singh 's suits against those defendants, respectively. were Nos.67, 65, 64 and 66. Each of these suits was for different sets of plots. The allegations of the plaintiffs in each suit and the contentions of the defendent in each suit were similar and therefore similar issues were framed in each suit and all the suits were tried together and were disposed of by one common judgment. Twelve decrees were, however, prepared. Against the twelve decrees the defendants judgment debtors in each decree filed twelve first appeals in the Court of the Additional Commissioner, Meerut Division. The Additional Commissioner dismissed three appeals for default, These were the appeals which were filed against Hoshiar Singh, Karam Singh and Mukhtiar Singh by Banwari. The Additional Commissioner heard the remainmg nine appeals on merits and dismissed them. The defendants judgment debtors then filed nine second appeals before the Board of Revenue. They were dismissed as barred by res judicata on May 7, 1954. The applications for special leave were filed in this Court in November 1954. Special leave was 220 granted on April 18, 1955. By the time the appeals came up for hearing, some other events took place and as a result of them the respondents filed an application for adducing additional evidence under O.XLV, rr. 1 to 5, Supreme Court Rules in November 1959, and also included in their statement of case a narration of those events and their effect. It appeals that the villages in which the lands in suit were situate, come under Consolidation Operations under the U.P. Consolidation of Holding.s Act, 1953(U. P. V of 1954), hereinafter called the Act, sometime in July 1954, when a declaration was issued by the State Government under s.4 of the Act to the effect that it had been decided to make a Scheme of consolidation for that area. In December 1954, a statement of plots and tenure holders was prepared and in May 1955 a statement of proposals under s.19 was prepared; in August 1955 final statements in chak form 25 were issued. On October 17, 1955, the State Government published a notification under s.52 of the Act. section 52 of the Act then read: "As soon as may be after the tenure holders have entered into possession of their new holding in pursuance of ;Section 26, the State Government shall issue a notification in the Official Gazette that the Consolidation opera tions have been closed in the village and the village shall then cease to be under consolidation operation. " It is thus seen that this village remained under Consolidation operations from some time in July 1954 to October 17, 1955. The appellants did not file any objections before the Consolidation authorities under s.12 of the Act disputing the correctness or the nature of the entries in the statement prepared under s.11 or under s.20 against the statement of proposals prepared under s.19 221 Section 21 provides for the fixing of a date for the enforcement or the consolidation scheme. Section 25 provides for the issuing of the allotment order showing the new fields allotted to each tenure holder in accordance with the said scheme. Section 26 provides for the tenure holders to enter into possession of the fields allotted to them on or after a certain date. Section 27 provides for the preparation of new village maps, khasra and the record of rights, in accordance with the Provisions of the U. P. Land Revenue Act, 1901. Its sub s (2) provides that all entries in the record of rights prepared under sub s.(1) small be final and conclusive, Section 30 provides that the rights, title, interest and liabilities of the tenure holder in his original holding shall be extinguished and he will have the same rights, title, interest and liabilities subject to modification, if any, in the plots allotted to him under s.25 with effect from the date on which he enters into possession of the plots allotted to him. It was contended for the respondents that in view of these consolidations operation and s.5 of the Act, as amended up to date, these appeals have become infructuous as this Court cannot pass any orders on the merits of the controversy. The Act has been amended several times since it was origi nally enacted. The various amendina Acts are: Act XXVI of 1954 which came into force on December 13, 1954; Act XIII of 1955 which me into force on June 10, 1955; Act XX of 1955 whcih came into force on October 21, 1955; Act XXIV of 1956 which came into force on July 3, 1956; Act XVI of 1957 which came into force on May 25, 1957 and Act XXXVIII of 1958 which came into force on November 19, 1958. During the period the village in suit was under Consolidation Operations, the Act applicable 222 to the proceedings was the Original Act as amended by Acts XXVI of 1954 and XIII of 1955. The other Acts came into force subsequent to the issue of the notification under s.52 of the Act. It is necessary to bear this in mind in view of the contentions raised. Section 5 of Act V of 1954 was as follows (1) Upon the publication of the declaration under section 4, the district or the local area; as the case may be, shall be deemed to be under consolidation operations from the date of such publication until this publication of the Notification under section 52 in the official Gazette to the effect that the consolidation operations have been closed. (2) Where a district or any other local area is under consolidation operations, the duty of preparing and maintaining the maps the khasra and the annual register under Chapter ITI of the U.P. Land Revenue Act, 1901, shall stand transferred to the Settlement Officer (Consolidation), and thereupon all the powers conferred on the Collector, Assistant Collecter and the Tahsildar under the said Chapter shall, so long as that district or the area remains under consolidation operations be exercised respectively by the Settlement Officer (Consolidation), Consolidation Officer and the Assistant Consolidation Officer. " Act XXVI of 1954 deleted the last portion of sub s.(2) commencing from the words "and there. No change in this section was made by the Amending Act XIII of 1955. There was therefore nothing in this section which in any way would have affected the hearing of these appeals, during or after the consolidation operations. 223 Section 12 of Act V of 1954 provided for the publication of the statement of plots and tenure holders prepared under section II and for filing objections disputing the correctness or nature of entries in it. Its subsections (4), (5) and (6) were : " (4) Where the objection filed under sub section (1) involves a question of title and such question has not already been determined by a competent court, the Consolidation Officer shall refer the question for determination to the Arbitrator. (5) All suits or proceedings in the court of first instance or appeal in which a question of title in relation to same land has been raised, shall be stayed. (6) The decision of the Arbitrator under sub section (4) shall be final. " There was nothing in these sub sections which provided as to how the suits or proceedings stayed been under sub section (5) would be decided or how matters in connection of which no objection bad raised under s.12 would be dealt with. These provisions too did not affect the pending Appeals as no objection had been filed under s.12. Act XXVI of 1954 amended sub s.(4) to the effect that the objection coming under sub s.(4) would be referred to the Civil Judge, who will then refer it to the Arbitrator, and substituted another sub section in the place of original sub s.(5). The substituted sub s.(5) read : "(5) Upon the making of reference under sub section (4) all suits or proceedings in the Court of first instance, appeal, reference or revision in which the question of title in relation to the same land has been raised, shall be stayed." This amendment in sub s.(5) stayed the suits and 224 proceedings not only in the Courts of the first instance and appeal but also in the Courts of reference and revision, but did not affect these appeals. Sub s.(2) of s.27 as originally enacted, was not amended up to the 17th October, 1955. Its sub s.(2) made the entries in the record of rights Prepared under sub s.(1) final and conclusive. 'We are not concerned with its effect in these appeals. Section 49 of the Act bars the jurisdiction of Civil Courts. This section, before its amendment by Act XTTT of 1955, which came into force on June 10, 1955, did not bar the institution of a suit or proceedings in the, revenue court. It did so after the amendment. ;,) appeals had been filed long before the amendment. We may state that no objection was raised on behalf of the respondent to the effect that these appeals could not have been instituted, but we have discussed that matter, in view of the fact that the appeals were filed after the State Government had made a declaration under s.4 of the Act. We have not been referred to any provision in these, Acts, viz. Act V of 1954, Act xxvr of 1954 and Act XIII of 1955 which would lead to the conclusion that these appeals have become infructuous. Act XX of 1955 made an amendment in s.27 of the Act. The amendment however does not affect the question before us. Act XXIV of 1956 which came into force on July 3, 1956, substituted a new section 5 in the place of the old. The substituted section 5 read : "5. When the declaration under section 4 has been published in the Gazette, the consequences as hereinafter set forth shall, 225 from the date specified thereunder till the publication of the notification under section 52 in the Official Gazette to the effect that the consolidation operations have been closed, ensue in the area to which the declaration relates, namely ; (a) the district or the local area, as the case may be, shall be deemed to be under consolidation operations from the specified date, and the duty of preparing and maintaining the khasra and the annual Register under Chapter III of the U.P. Land Revenue Act, 1901, shall stand transferred to the Settlement Officer (Consolidation), and (b) all proceedings for the correction of any such records pending before any court or authority shall be stayed but without pre judice to the right of the persons affected to agitate the question before the Assistant Consolidation Officer under sub section (3) of Section 8, or in proceedings commenced under and in accordance with section 10" Clearly, cl. (b) does not apply to these appeals as they have not arisen out of proceedings for the correction of village records. Act XXIV of 1956 made certain amendments in section 11 with which we are not concerned. We are not also concerned with the amendments this Act made in subs. (1) of section 12. It substituted a new sub section (5) and added sub section These new subsections (5) and (7)are: "(5) Upon the publication of the statement under section 11, all suits or proceedings in the Court of first instance, appeal, reference or revision, in which the question of title in respect of any plot mentioned in the statement with reference to clause (c) of sub section (1) of section II has been raised, shall be 226 stayed to the extent it relates to such plot and shall thereafter be disposed of in the manner prescribed. (7) A question of title in respect of any plot mentioned in the statement in clause (c) Of sub section 1 of section 11, which might and ought to have been raised under subsection (1) but had not been raised, shall not be raised in any objection filed under subsection (2) of section 20, or under sub section (1) of section 34. " It is for the first time that such suits and proceedings in the various Courts had to be stayed in which a question of title in respect of any plot mentioned in the statement with reference to el. (c) of sub section (1) of section 11 had been raised and that these stayed suits or proceedings were to be decided subsequently in the manner prescribed, i. e., in the manner laid down under rules framed under the Act. These provisions of sub section (5) do not affect the appeals as they were prospective in operation and could apply to those cases only in which at atements under section 11 were filed after the amendment had been made. The amendments made by the other sections of this Act and Act XVI of 1957, do not affect the hearing of the appeals in any way. Thereafter case Act XXXVIII of 1958. This Act again substituted a new section 5, and the relevant portion of the substituted section reads: 5.Upon the publication of the notification under section 4 in the Official Gazette, the consequences, as hereinafter set forth, shall, subject to the provisions of this Act, from the date specified thereunder till the publication of notification under section 52 or sub section (1) of section 6, as. the case may 227 be, ensue in the area to which . the declaration relates; namely x x x x x (b) (1) all proceedings for correction of the records and all suits for declaration of rights and interest over land , or for posses sion of land or for partition, pending before any authority or court, whether of first ins tance, appeal or reference or revision, shall stand stayed, but without prejudice to the right of the persons affected to agitate the right or interests in dispute in the said pro ceedings or suits before the consolidation au thorities under and in accordance with the provisions of this Act and the Rules made thereunder: (ii) the findings of consolidation autho rities in proceedings under this Act in respect of such right or interest in the land, shall be acceptable to the authority or court before whom the proceeding or suit was pending which may, on communication thereof by the parties concerned. proceed with the proceeding or suit, as the case may be; These provisions operate prospectively. The consequences mentioned in section 5 ensue upon the publication of the notification under section 4 in the Gazette and continue up to the publication of the notification under section 52. They do not continue thereafter and could not operate on these cases in which the notification under section 52 was issued on the 17th October 1955. They do not therefore bar the hearing of these appeals. These a peals have not. therefore become infructuous. Sections 7, 8, 9, 10, 11, 11 A, 11 B, 12, 12 A, 12 B, 12 C and 12 D have been substituted by new section which apply to proceedings taken in consolidation operations subsequent to the coming into force of 'the Amending Act XXXVIII of 1858. Sub section (1) of 228 is. 12 makes it clear that the matters mentioned in that sub section cannot be raised subsequent to the date of notification under section 52. There has been no material change made in as. 27 and 30, but section 49 now reads: "49. Notwithstanding anything contained in any other law, for the time being in force the declaration and adjudication of rights of tenure holders in respect of land lying in an area, for which a declaration has been issued under section 4, or adjudication of any other right arising out of consolidation proceedings and in regard to which a proceeding could or ought to have been taken under this Act, shall be done in accordance with the provisions of this Act and no civil or revenue court shall entertain any suit or proceeding with respect to rights in such land or with respect to any other matters for which a proceeding could or ought to have been taken under this Act. " This now provides that the adjudication of ' rights of tenure holders in respect of land lying in an area under consolidation operations shall be done in accordance with the provisions of the Act. This leads practically to the same result to which cl. (ii) of sub section (b) of section 5 leads to. The provisions of this section are not expressly limited to the period between the declaration under section 4 and the notification under section 52, but can be so construed as they relate back to section 5 (b) (ii) of the Act as the declara tion and adjudication of rights have to be done in accordance with the provisions of the Act. Further the amended provision would apply to the proceedings regarding rights in land in the area for which a declaration under section 4 has been issued after the amendment. We are therefore of opinion that these appeals have not become infructuous. 229 On the merits, we are of opinion that the Board of Revenue erred in holding that the appeals before it were barred by res judicata. It is essential for any previous Adjudication of a point to bar its consideration second time that, the previous adjudication must have been between the same parties and that it be with respect to the same matter. The three suits in which judgments became final were against one Banwari and ', not against any of the present appellants. The matter in issue in those three suits were also different 'from that in the suits which have given rise to these appeals. Each of the twelve suits related to different plots. A common judgment on account of similar questions being raised for decision in the different suits, does not always make that judgment amount to one judgment in those suits. Such a judgment will ordinarily be deemed to be really so many judgments as the suits disposed of by it. This Court expressed a similar view in Badri Narayan Singh vs Kamdeo Prasad Singh(1). We therefore allow the appeals, set aside the order of the Court below and remand the appeals to it for further hearing and decision according to law. ' We may make it clear that it can take into consideration the effect of the Consolidation Act and proceedings thereunder, after giving an opportunity to the parties to submit what, they like in regard to them costs to abide the result. Appeals.

K, H and M filed four suits each against four sets of defendants in respect of different sets of plots under section 175 U. P. Tenancy Act, 1939. Since similar points were involved the twelve suits were tried together and were disposed of by a common judgment decreeing them. Twelve decrees were prepared and the defendants preferred twelve appeals to the Additional Commissioner. Three appeals by one set of the defendants B were dismissed for default and the remaining nine were dismissed on merits. Against the dismissal of the nine appeals on merits the three sets of defendants preferred nine second appeals before the Board of Revenue but they were dismissed as barred by res judicata on May 7, 1954. In November, 1954, the appellants filed petitions for special leave before the Supreme Court and on April 18, 1955, special leave was granted. In July 1954, the villages in Which the lands in suit were situate came under consolidation operations under the U. P. Consolidation of Holdings Act, 1953, and the operations were completed by the publication of a notification 218 under section 52 of the Act on October 17, 1953. The appellants did not file any objections before the consolidation authorities. The respondent contended that in view of the consolidation operations the appeals before the Supreme Court had become infructuous. Held, that the appeals had not become infructuous. There was nothing in the U. P. Consolidation of Holdings Act, 1953, as it stood during the period the village in suit was under consolidation operations which could have in any way affected these appeals, during or after the consolidation operations. The subsequent Amending Acts did not affect the appeals as they were prospective in operation and applied only to cases where the consolidation operations were started after the Amending Acts had come into force. Held, further that the appeals before the Board of Revenue were not barred by resjudicata. It was essential for the bar of res judicata that the previous and judication must have been between the same parties. The three suits in which judgments had become final were against one B and not against any of the appellants . The matter in issue in those three suits was different from that in the other nine suits as each of the suits related to different plots. The common judgment was really twelve judgments in the twelve suits. Badri Narayan Singh vs Kamdeo Prasad Singh, (1962) 3. section C. R. 759 referred to.

l Appeals Nos. 51 and 52/61 Appeals from the judgment and decree dated September 23, 1959, of the Allahabad High Court (Lucknow Bench) at Lucknow in C. M. Applications Nos. 15 (O.J.) and 16 (O.J.) of 1957 respectively. C. B. Agarwala and C. P. Lal, for the Appellants (in both the appeals). A. V. Viswanatha Sastri, and K. L. Arora, for Respondent No. 1 (in both the appeals). February 7. The Judgment of the Court was delivered by SARKAR, J. These two appeals have been heard together. The, appellants in each case are the State of Uttar Pradesh, for short called U. P. and some of its officers and the respondents in one appeal are Lakshmi Ice Factory and certain of its workers and in the other the Prakash Ice Factory and certain of its workers. These appeals involve a question of construction of certain provisions of the U. P. , hereafter referred to as the Act. By a Notification issued on February 10, 1956, the Government of U. P. referred certain disputes which had cropped up between each of the Ice Factories and its respective workmen, to an Industrial Tribunal for adjudication. The details of these disputes are not material for these appeals. The Tribunal heard the matters but failed to pronounce its award in open court. Instead, on November 8, 1956, the Registrar of the Tribunal informed the Ice Factories that the award of the Tribunal had been submitted to the Government. On December, 15, 1956, the award was published in the U. P. Gazette and it appeared from this publication that the award was dated November 8, 1956. On December 26, 1956, the Regional Conciliation Offi cer appointed under the Act " called upon the Ice 61 Factories to implement the award immediately. Thereupon the Tee Factories moved the High Court at Allahabad on January 3, 1957 under article 226 of the Constitution for writs quashing the award and prohibiting the Government and the workmen from taking steps to implement it. They contended that the award sought to be enforced was a nullity as it had not been pronounced in open court as required by certain rules to which reference will presently be made. By a judgment passed on September 23, 1959, the High Court allowed the petitions of the Ice Factories and issued writs quashing the Notification publishing the award. The appeals are against this judgment of the High Court. Section 3 of the Act gives the Government power in certain circumstances to make provisions by general, or special order (1) for appointing Industrial courts, (2) for referring any industrial dispute for adjudication in the manner provided in the order and (3) for matters incidental or supplementary to the other provisions of the order. Under this power the Government had issued an Order dated July 14, 1954 and this Order is hereafter called the "Statutory Order. " It was under powers conferred by the Act read with the Statutory Order that the Government had issued the Notification of February 10, 1956. In exercise of powers conferred by el. 8 of the Statutory Order the Government had set up the Tribunal. Clause 9 of the Statutory Order provides for the procedure to be followed by the Tribunal. Sub clause (7) of this clause is in these terms: "The decision of the Tribunal shall be in writing and shall be pronounced in open court and dated and signed by the member or members of the Tribunal, as the case may be, at the time of pronouncing it. " Clause 11 of the Statutory Order gives power to Government to refer any industrial dispute to the Tribunal. Sub clause (9) of el. 9 of the Statutory Order 62 gives power to the Tribunal to make Standing Orders relating to its practice and procedure. Under this sub clause the Tribunal framed certain Standing Orders. Standing Order No. 36 provided. "Judgment shall be pronounced in open court either immediately after the close of the arguments or on a subsequent date of which previous notice shall be given to the parties. It shall then be signed and dated by the Tribunal. " Acting presumably under Standing Order No. 36, the Tribunal in the present case bad fixed a date on which it would pronounce its judgment in open court. This date does not appear on the record but on September 25, 1956, the Tribunal informed the parties that the date for pronouncing the award had been changed to October 9, 1956. On that date, however, the award was not pronounced in open court, nor was any intimation of any other date for its pronouncement given to the parties. The lee Factories first came to know of the making of the award from the letter of the Registrar of the Tribunal dated November 8, 1956 earlier referred to. The award had in fact never been pronounced in open court. The first question is whether the provisions in sub el. (7) of el. 9 are imperative. The High Court held that they were and thereupon quashed the Notification publishing the award. The appellants contend that the High Court was in error and that the provisions are only directory and that the failure of the Tribunal to pronounce the award in open Court did not result in the award becoming void. The Ice Factories contend for the contract view. Mr. Aggarwala for the appellants referred us to the rule of construction stated in Maxwell on Interpretation of Statutes, 10th ed. at p. 381, which is as follows : ",Where the prescriptions of a statute relate to the performance of a public duty and 63 where the invalidation of acts done in neglect of them, would work serious general inconvenience or injustice to persons who have no control over those entrusted with the duty without promoting the essential aims of the Legislature, such prescriptions seem to be generally understood as mere instructions for the guidance and government of those on whom the duty is imposed, or, in other words as 'directory only". Ho said that sub el. (7) of cl. 9 of the Statutory Order imposed a public duty on the Tribunal and as none of the contesting parties to the proceedings before the Tribunal had any control over it, the provision in the Statutory Order as to how the Tribunal is to discharge its duty must be regarded as merely directory and therefore a disregard of that provision by the Tribunal would not render the thing done by it a nullity. It seems to us that the rule read from Maxwell is not applicable to this case. It applies only when to hold the prescriptions in a statute as to the performance of a public duty to be imperative would work injustice and hardship without serving the object of the statute. None of these conditions are present ill the statute now before us. The rule may be illustrated by reference to the case of Montreal Street Railway Co. vs Normandin(1) which is cited in Maxwell 's book. That was a case in which certain Statutory provisions as to how the jury list was to be revised had not been followed and the question arose whether the verdict of a jury empannelled out of a list revised in disregard of the provision was a nullity. It was hold that the verdict was not a nullity as the provision regarding the revision of the jury list was merely directory. It was further held that the object of the provision was to distribute the burden of jury equally between all liable to it, to secure effective jurors likely to attend and lastly to prevent packing of the jury. It was said that "It does far less harm to allow cases tried by a jury formed as this one was (1) ; 64 with the opportunities there would be object to any unqualified man called into the box, to stand good, than to hold the proceedings null and void. So to hold would not, of course, prevent, the courts granting new trials in cases where there was reason think that a fair trial had not been had": P. 176). The case in hand is wholly different. The proceedings that were had before the Tribunal would not become null and void if we hold el. 9(7) of the Statutory Order to be imperative,. A view that the provision was imperative would cause no serious hardship to any one. The Government can always require the Tribunal to pronounce, its decision in open court extending, if necessary for the purpose. he time fixed for giving its decision. Either party of the proceeding can also ask the Government to call upon the Tribunal to pronounce its award in open court. There is no doubt that the Government will go call upon the Tribunal when the defect s brought to its 'notice for the Government itself referred the matter to the Tribunal for if decision. As soon as the Tribunal pronounces it,; award in open court, the proceedings will become fully effective. It is also an accepted rule of construction that enactments regulating the procedure in courts are usually imperative : Maxwell on Interpretation of statues 10th ed. p. 379. It further appears to us that the object of the legislature would be defeated by reading cl. 9(7) of the Statutory Order as containing a provision which is merely director vs We now proceed to ascertain that object from the, other provisions in the Statutory Order, the Act and connected legislation. Section 6 of the IT. P. Act provides as follows : (1) When an authority to which an industrial dispute has been referred for 65 adjudication has completed it,% enquiry, it shall, within such time as may be ,specified, submit its award to the State Government. (2) The State Government may. enforce for such period as it may specify all or any of the decisions in the award. It was under this section that the Tribunal submitted it,% award to the Government and the Government issued the Notification in the Gazette dated December 15, 1956 earlier mentioned and directed that the award be enforced for a period of one year from the date of the publication. Since the award has to be submitted to the Government by the Tribunal under section 6 of the Act, the award has to be in writing, for a verbal award cannot obviously be submitted to the Government. It would therefore appear that the provision in sub cle. (7) of el. 9 of the Statutory Order that the decision of the Tribunal shall be in writing is imperative, This would be an indication that the other provisions in the same sub clause connected with it were intended to be equally imperative. Then we find that el. 18 of the Statutory Order is in these terms : "The Tribunal or the adjudicator shall hear the dispute and give its or his decision within 180 days (excluding holidays but Dot annual vacations observed by courts subordinate to the High Court) from the date of reference made to it or him by the State Government and shall thereafter as soon as possible, supply a copy of the same to the parties to the dispute. . . Provided that the State Government may extend the said period from time to time. " It seems to us that the provision in this clause in clearly mandatory. The Tribunal has no power to make an award after the time mentioned in it; if it had, the proviso to el. 18 would be wholly unnecessary. The result therefore is that it is 66 obligatory on the Tribunal to give its decision within 180 days from the date of the reference. A decision given, that is an award made, beyond this period would be a nullity. Now when cl. 18 talks of giving a decision, it can only mean giving it in the manner indicated in sub cl, (7) of cl. 9 of the Statutory Order, that is, by pronouncing it in open court, for that is the only manner of giving a decision which that order contemplates. It would follow that the terms of cl. 9(7) were imperative, for otherwise no one would know whether the terms of el. 18 of the Statutory Order had been complied with, that is to say, no one would know whether the award was void or not. The provisions of cl. IS may thus be rendered nugatory by holding el. 9(7) to be only directory. It would follow that unless the provision as to the pronouncement of the award in open court was mandatory, the intention of the framers of the Statutory Order would be defeated. Sub clause (2) of cl. 24 of the Statutory Order also leads to the same conclusion. That sub clause is in these terms : "Clerical or arithmetical mistakes in decisions or awards, or errors arising therein from any accidental slip or omis sion may, within one month of giving the decision or award be corrected by the Tribunal or the adjudicator, either of its or his own motion or on the application of any of the parties. " Under this rule therefore clerical or arithmetical errors or slips may be corrected within one month of the giving of the decision and the parties have the right to apply for such corrections within that time. The Tribunal has no right to correct an error beyond that time. Nor has a party a right to move the Tribunal for making any such corrections after the time has expired. In order that the intention of cl. 24 (2) may be, given effect to, it is necessary that the date of the 67 giving of the decision should be known. It cannot promptly be known to the parties unless the award is pronounced in open court. If any other Manner of the giving of the decision was permissible as would be the result if it was not obligatory to pronounce the decision in open court, then a party may be deprived of its right under cl. 24 to move the Tribunal for correction of errors. It is for this reason that cl. 9(7) provides that the decision shall be dated and signed at the time of pronouncing it in open court. This signing and dating of the award after its pronouncement in open court makes it possible to see whether the terms of cls. 18 and 24 (2) have been complied with in any case. The third thing which to our mind indicates that pronouncement in open court is essential is cl. 31 of the Statutory Order. That clause is in these terms : "Except as provided in this Order and in the Industrial Disputes (Appellate Tribunal) Act, 1950, every order made or direction issued under the provisions of this Order shall be final and conclusive and shall not be questioned by any party thereto in any proceedings. " The Industrial Disputes (Appellate Tribunal) Act, 1950 provides for appeals from decisions of certain Industrial Tribunals to the Appellate Tribunal established under it. Clause 31 therefore makes a decision of the Tribunal on a reference to it final subject to an appeal if any allowed under the Industrial Disputes (Appellate Tribunal) Act, 1950. Under a. 7 of the Act of 1950, an appeal shall lie to the Appellate Tribunal from any award or decision of an Industrial Tribunal concerning certain specified matters. Now an Industrial Tribunal mentioned in section 7 includes a Tribunal set up under a State law which law does not provide for an appeal : see a. 2(o)(iii) of the Act of 1950. The U. P. Act does not provide for any appeal expressly but cl. 31 of the Statutory Order makes a decision of the Tribunal final subject to 68 the provisions of the Act of 1950. It would therefore appear that an appeal would lie under the Act of 1950 to the Appellate Tribunal constituted under it from a decision of a Tribunal set up under the Statutory Order. Now under a. 10 of the Act of 1950, an appeal is competent if preferred within thirty days from the date of the publication of the award where such publication is provided for by the law under which the award is made, or from the date of the making of the award where there is no provision for such publication. Now the U.P. Act or the Statutory Order does not provide for any publication of an award. Therefore an appeal from the Tribunal set up under the Statutory Order has to be filed within thirty days from the making of the award. Hence again it is essential that the date of the making of the award shall be known to the parties to enable them to avail themselves of the right of appeal. This cannot be known unless the judgment is pronounced in open court for the date of award is the date of its pronouncement. Hence again pronouncement of the judgment in open court is essential. If it were not so, the provisions for appeal might be rendered ineffective. For all these reasons it seems to us that the clear intention of the legislature is to make it imperative that judgments should be pronounced in open court by the Tribunal and judgments not so pronounced would therefore be a nullity. In the view that we have taken it is unnecessary to deal separately with Standing Order No. 36. The provisions of that Standing Order and cl. 9(7) of the Statutory Order are substantially the same. They should therefore be interpreted in the same way. In any case since we have held the el. 9(7) of the Statutory Order to be imperative. it would not matter whatever view is taken of the Standing Order for the latter cannot affect the former. 69 Mr. Aggarwala then argued that cl. 9(7) of the Statutory Order and Standing Order No. 36 were ultra vires as being in conflict with the Act under which they had been framed. His contention was this : Under section 6 of the Act all that the Tribunal has to do is to submit its award to the Government after the conclusion of the enquiry before it. The section does not require the Tribunal to pronounce its decision in open court. The provisions in the Statutory Order and the Standing Order both of which were made under powers contained in the Act, were therefore in conflict with section 6 and of no effect. Hence he contended that the question whether the provisions of cl. 9(7) of the Statutory Order or of the Standing Order No. 36 were imperative did not really arise. It seems to us that this contention of Mr. Aggarwala is without any foundation. Section 6 when it requires that the Tribunal shall submit its award to the Government necessarily contemplates the making of the award. Neither section 6 nor any other provision in the Act provides how the award is to be made. Under section 3(g) however the Government has power by general or special. order to provide for incidental or supplementary matters necessary for the decision of an industrial dispute referred for adjudication under any order made tinder section 3. 'rho provision as to the pronouncement of the decision in open court in (19(7) of the Statutory Order clearly is within the power,; contemplated in section 3(g). Section 6 does not prohibit the making of such a provision. Its main purpose is to direct that the Tribunal shall submit the award to the Government so that it may be enforced. It has nothing to do with the manner in which the 'Tribunal is to make 70 its award. A rule duly framed under the Act requiring the Tribunal to pronounce its decision in open court is therefore not in conflict with section 6. The result is that these appeals fail and are dismissed with costs. Appeals dismissed.

The Government of Uttar Pradesh under section 3 of the U.P. , and the Statutory orders framed thereunder referred certain. disputes between the respondent Ice Factories and the respective workmen to an Industrial Tribunal. The Tribunal heard the matters but failed to pronounce its award in open court, as required under the clause 9 (7) of the Statutory Orders. Instead the Registrar of the Tribunal informed the Ice Factories that the award of the Tribunal had been submitted to the Government. The award was published in the U.P. Gazette and the Regional Conciliation officer called upon the Ice Factories to implement the award immediately. The Ice Factories moved the High Court at Allahabad alleging that the award was a nullity as it had not been pronounced in open court as required under the clause 9 (7) of the Statutory Orders and asking for writs to quash it. High Court issued the writs quashing the Notification publishing the award. The questions are whether the provisions of sub cl. (7) of cl. 9 of the Statutory Orders are imperative or merely directory and whether that sub clause is ultra vires as being in conflict with the Act under which it had been framed. Held, that the clear intention of the legislature is to make it imperative that judgments should be pronounced in open court by the Tribunal and a judgment not so pronounced would therefore be a nullity. The provision in sub cl.(7) of cl. 9 of the Statutory Order is imperative and not directory. Held, further, that the provisions as to the pronouncement of the decision in open court contained in cl. 9 (7) of the Statutory Order was clearly within the powers contemplated in section 3 (g) of the Act and section 6 of the Act does not prohibit the making of such provisions. A rule duly framed under the Act requiring the Tribunal to pronounce its decision in open court is therefore not in conflict with section 6 of the Act. Montreal Street Railway Co. vs Normandin, ; , referred to.

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

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

Appeal No. 175 of 1951. Appeal by Special Leave from the Order and Decree dated the 30th March, 1951, of the High Court of Judicature at Patna (Ramaswami and Rai JJ.) in Miscellaneous Appeal No. 19 of 1951 arising out of the Order dated the 18th December, 1950, of the 'Court of the Additional Sub Judge Second at Gaya in Title Suit No. 47 of 1950. N. C. Chatterjee (Rameshwar Nath, with him) for the appellant. M. C. Setalvad Attorney General for India, and Mahabir Prasad, Advocate General of Bihar (B. J. Umrigar with them) for the respondent. February 3. The Judgment of the Court was delivered by MAHAJAN J. This appeal by special leave arises out of an application made by the State of Bihar against the Gaya Electric Supply Co. Ltd. under section 34 of the Indian Arbitration Act for stay of proceedings in a suit filed by the company on 28th September, 1950. The facts relevant to this enquiry are these. 574 A licence of or the supply of electric energy in the town of Gaya was obtained by one Khandelwal in the year 1928 under the . With the required sanction of the Government the licence was transferred to the company in 1932. By a notification dated 23rd June, 1949, the licence was revoked by the Government with effect from 9th July, 1949. Thereupon the company filed a suit against the State for a declaration that the revocation of the licence was arbitrary, mala fide and ultra vires. During the pendency of the suit negotiations started between the company and the State for a settlement of the dispute and ultimately on 28th October, 1949, a deed of agreement was arrived at between them. The effect of the agreement and the correspondence referred to therein was substantially as; follows : (a) That the company would withdraw the suit No. 58 of 1949 unconditionally on 25th October, 1949. (b) That within three days of the withdrawal of ,the suit the State of Bihar would make an advance payment of rupees five lakhs to the company, and, simultaneously the company would formally hand over the possession of the undertaking to an authorized officer of the Government. (c) That both parties will make their respective valuations within three months of talking over the undertaking and any balance of money found due to the company as per Government valuation will be paid to the company and in case of overpayment the excess paid to the company on account of the " on account payment " of rupees five lakhs will be refunded to the, Government. (d) That in the case of any difference or dispute between,the parties over the payment of the balance which may be found due after valuation such dispute shall be submitted to the sole arbitration of a single arbitrator who should be a high government officer of the provincial government of rank equal to or higher than a Divisional Commissioner and his award shall be binding and final on both parties. 575 The arbitration clause is contained in a letter dated 13th October, 1949, and was substantially accepted by the company in its letter dated 17th October, 1949. As set out by the State Government in its application under section 34, it runs as follows " In the case of any difference or dispute between the parties over the valuation as arrived at by the Government and that arrived at by the company, such difference or dispute, including the claim for additional compensation of 20 % shall be referred to arbitration. " In pursuance of the agreement the respondent took over the undertaking on 28th October, 1949, and also made a payment of rupees five lakhs to the company. On the 19th January, 1950, the company sent a statement of valuation of the assets amounting to RS. 22,06,072, to the Chief Electrical Engineer, Bihar. The Chief Electrical Engineer characterized the valuation of 22 lakhs by the company as fantastic and stated that according to a rough valuation the amount would be ' approximately five lakhs and that the final valuation would be settled after the company had furnished a detailed history of the plants and machineries. The company declined to give any further details and stated that time was of the essence of the. contract and it would be extended from 28th January, to 15th February, 1950 On 6th April, 1950, the Chief Electrical Engineer intimated that the 'valuation amounted to Rs. 6,56,221. No reply to this letter was received and the State Government intimated to the company that as difference and dispute had arisen relating to valuation, Mr. M. section Rao, I.C.S. was being appointed as sole arbitrator to decide the dispute. On 28th September, 1950, the company instituted the suit, the subject matter the application for stay, after necessary notice under section 80 of the Code of Civil Procedure. In the plaint it was alleged ,that as the State Government had failed and neglected to make its valuation or to make payment to the 576 company by the 15th March, 1950, it committed a breach of the agreement and by reason of this breach the company had rescinded the agreement and had forfeited the sum of five lakhs paid as advance by the State. The company prayed inter alia for the reliefs of declaration that the, electrical undertaking belonged to them, for damages, for appointment of receiver and for injunction. On the 9th October, 1950, the State Government filed the present appli cation under section 34, of the Indian Arbitration Act. It was stated therein that the company had with a, dishonest and mala fide motive and with a view to avoid the decision of the matter in dispute in arbitration instituted the suit on incorrect and false allegations. that the arbitration agreement was still subsisting and valid and binding on the parties and could not be taken as having been rescinded as alleged by the company, that the cause of action as alleged in the plaint being noncompliance with the agreement the suit arose out of and related to the agreement and was covered by the arbitration clause and that the State Government was ready and willing to have the dispute settled by arbitration. The company denied the allegations of mala fides and pleaded that the arbitration clause was no longer in existence and that even assuming it to be in existence, the suit was in no way connected with the 'same and it was contended that the suit should not be stayed. The subordinate judge held that the suit was no in respect of any matter agreed to be referred, and that the court had no ' jurisdiction to stay the proceedings. In the result the stay application was dismissed. Against this order the State Government appealed to the High Court. The High Court held that the dispute in the suit was one which arose out of or was in respect of the agreement and that the question in the suit was directly within the scope of the arbitration clause. By an order of this court dated 22nd May, 1951, the company was granted special leave ' under article 136(1) of the Constitution. ' 577 Section 34 of, the Indian Arbitration Act runs thus "Where any party to an arbitration comment Cost any legal proceedings against any other party to the agreement in respect of any matter agreed to be ,referred, any party to such legal proceedings may, apply to the judicial authority before which the proceedings are pending to stay the proceedings, and if satisfied that there is no sufficient reason why the matter should not be referred in accordance with the arbitration agreement and that the applicant was, at ,the time when the proceedings were commenced, and still remains, ready and willing to do all things necessary to the proper conduct of 'the arbitration, such authority may make an order staying the proceedings. " From the language of the section it is quite clear that the legal proceeding which is sought to be stayed must be in respect of a matter which the parties have agreed to refer and which comes within the ambit of the arbitration agreement. Where, however, a suit is commenced as to a matter which lies outside the submission, the court is bound to refuse a stay. In the words of Viscount Simona L. C. in Heyman vs Daruins Ltd ' (1). the answer to the question whether a dispute falls within an arbitration clause in a contract must depend on (a) what is the dispute, and (b) what disputes the arbitration clause covers. If the arbitration agreement is broad and comprehensive and embraces any dispute between the parties "in respect of" the agreement, or in respect of any provision in the agreement, or in respect of anything arising out of it, and one of the parties seeks to avoid the contract, the dispute is referable to arbitration if the avoidance of the contract arises out of the terms of the contract itself. ' Where, however, the party soaks to avoid the contract for reasons dehors it, the arbitration clause cannot be resorted to as it goes along with other terms of the contract. In other words, a party cannot rely on a term of the contract (1) , 578 to repudiate it and still say the arbitration clause should not apply. If he relies upon a contract, be must, rely on it for all purposes . Where, however, an arbitration clause is not so comprehensive and is not drafted in the broad language which was, used in the House of Lords,case, namely ' "in respect of" any agreement, or in respect of something, arising out of it", that proposition does not hold good. The arbitration clause is a written submission agreed to by the parties in a contract and like every written submission to arbitration must be considered according to its language and in the light of the circumstances in which it is made. Now as regards the first question, viz., what is the present dispute about, the answer is to be gathered from paragraphs 14 to 17 of the plaint. It is averred therein that the Government of Bihar committed breach of the agreement and failed to make any, valuation of the undertaking or pay the balance of the compensation money, that time being of the essence of the contract, the defendant failed and neglected to complete the valuation within the time originally fixed or the extended time, and that by reason of the breach of contract the plaintiff rescinded the agreement and forfeited the sum of rupees five lakhs and that it is entitled to compensation for the wrongful deprivation of the use of its property. No claim has been made in the plaint for the valuation of the undertaking or for the payment of any compensation for the undertaking; on the other hand, the claim in the suit is founded on the rescission of the agreement containing the arbitration clause and on a breach of that agreement. These are matters which may well be said to arise out of the agreement and if the arbitration clause was broadly worded and stated that all disputes arising out of the agreement would be referred to arbitration, it could then probably have been said that the scope of the suit was within the ambit of the arbitration clause, but the clause here is differently worded. The clause here is that if any difference. or dispute arises between the parties over the payment of the 579 balance which may be found due after valuation such dispute shall be submitted to the sole arbitration of a single arbitrator. The scheme of the agreement is that the Government was to make a valuation as laid ' down in the within three, months of taking over the undertaking and any balance of money found due to the company as per Government valuation was to be paid by the Government, and in case of over payment, the excess paid to the company on account of the "on account payment" of rupees five lakhs mentioned in paragraph 1 had to be refunded to government. In the case of any difference between the parties over the valuation as arrived at by the Government and that arrived at by the company, such difference or dispute, including the claim for additional compensation of twenty per cent. had to be referred to arbitration a scope of it is arbitration clause is a very narrow one. It only confers jurisdiction on the arbitrator on the question of valuation of the undertaking pure and simple and does not say that all disputes arising out of the agreement or in respect of it will be decided by arbitration. Questions relating to the breach of contract or its rescission are outside the reach of this clause. The arbitrator has not been conferred the power by this clause to pronounce on the issue whether the plaintiff was justified in claiming that time was of the essence of the contract and whether the State Government committed a breach of the contract by not making a valuation within the time specified. This clause is therefore no answer to the company 's querry "Show me that I have agreed to refer the subject matter of the suit to an arbitrator. " Besides this clause in the agreement there is nothing else which can deprive the court of its jurisdiction to decide the plaintiff 's suit as brought. Ramaswami J., with whom Rai J. concurred, held that upon a perusal of the term,; of the contract and of the correspondence it was obvious that no stipulation was made that the compensation money 75 580 should be paid within the period of three months, that on the contrary, the intention of the parties that the Government would pay compensation money only after the award had been made by the arbitrator. Now this is the very point which would be in issue in the suit itself, and the learned Judge was in error in considering and deciding this point in this enquiry under section 34. The validity of the plaintiff 's contention in the suit cannot be gone into by that court exercising jurisdiction under this section as its function is a very limited one. The only point in such cases to be decided is whether the claim which is brought whether it is good, bad or indifferent comes within the submission to arbitration. It may be that there are grounds upon which the defendant would be able to satisfy the proper tribunal that the plaintiff 's claim was frivolous and vexatious, but those considerations, as pointed out by Banks L. J in Monro vs Bognor Urban Council (1), are material only if the question to be considered is whether the case made was a frivolous and vexatious one and ought to have had no weight at all upon the question of what the plaintiff 's claim in fact was and one can only find out what his claim is by looking at the plaint. The learned Judges in the High Court seem to have thought that the arbitration clause here had been drafted broadly and that all "disputes arising out of or in respect of the agreements were referable to arbitration. Their reliance on the decision of the Calcutta High Court in Harinagar Sugar Mills Ltd. vs Skoda India Ltd.(") in support of the decision indicates the error. In that case the arbitration clause was drafted in a comprehensive language and stated that a dispute arising out of the agreement had to be referred to arbitration. Their reference to the case of Governor General in Council vs Associated Livestock Farm Ltd. (3) also shows that they were under the same erroneous impression. In this case the arbitration clause was in these terms : (1) [1915] 3 K.B. i67. (2) (3) A.I.R. 1948 Cal, 230, 581 "Any dispute or difference arising out of the contract shall be referred to the arbitration of the officer sanctioning the contract whose decision shall be final and binding. " It is obvious that these decisions could have no relevance to the arbitration clause as drawn up in the present case. If the nature of the claim is as we have indicated above, it seems plain that it does not come within the scope of the submission. In our judgment, therefore, the decision of the learned Subordinate Judge was right and the Judges of the High Court were in error in reversing it. In the result the only course open to us is to allow the appeal with costs and to say that the plaintiff 's claim is not within the scope of the submission and that the petition under section 34 was rightly dismissed by the Subordinate Judge. Appeal allowed. Agent for the appellants Rajinder Narain. Agent for the respondent P. K. Chatterji.

If the arbitration agreement is broad and, comprehensive and embraces any dispute between the parties in respect of the agreement, or in respect of any provision in the agreement, or in respect of anything arising out of it, and one of the parties seeks to avoid the contract, the dispute is referable to arbitration if the avoidance of the contract arises out of the terms of the contract itself. Where, however, the party seeks to avoid the contract for reasons dehors it, the arbitration clause cannot be resorted to as it goes along with other terms of the contract. In other words, a party cannot rely on a term of the contract to repudiate it and still say the arbitration clause should not apply. Where, however, an arbitration clause is not so comprehen sive and is not drafted in the broad language namely " in respect of " any agreement, or "in respect of something arising out of it", that proposition does not hold good. The arbitration clause is a written submission agreed to by the parties in a contract and like every written submission to arbitration must be considered according to its language and in the light of the circumstances in which it is made. Disputes which arose between the State of Bihar and an Electric Supply Company whose licence had been revoked by the State were settled by an agreement which provided that the State should make an advance payment of Rs. 5 lakhs to the company, and the company should hand over the undertaking to the State. The undertaking was to be valued, within 3 months and if any money was found due to the company as per the Government valuation over 5 lakhs it will be paid to the company and if the valuation was less than 5 lakhs the company would refund the excess received by it. The agreement, contained an arbitration clause which ran as follows: " In the case of any difference or dispute between the parties over the valuation as arrived at by the Government and that arrived at by the company any such difference or dispute including the claim for additional compensation of 20% shall be referred to arbitration. " The company instituted a suit against the State alleging that the State bad failed to make its valuation. and to make, payment of the excess within the time fixed and as time was of the essence of the contract, it had rescinded the agreement, and praying for a declaration that the undertaking belonged to it, for damages and appointment of a receiver. The State applied under section 34 of the Arbitration Act for stay of the suit: Held, that the scope of the arbitration clause was very narrow; it conferred jurisdiction on the arbitrator only on the question of valuation of the undertaking pure and simple. Questions relating to the breach of contract or its rescission were outside the scope of the clause and the suit could not be stayed under section 34. Heyman vs Darwins Ltd. (119421 A.C. 356) referred to. Harinagar Sugar Mills Ltd. vs Skoda (India) Ltd. (A.I.R. and Governor General in Council vs Associated Livestock Farm Ltd. ([1937] distinguished.

Appeal No. 356 of 58. Appeal by special leave from the judgment and order dated January 21, 1955, of the Bombay High Court in Civil Revision Application No. 813 of 1953. section T. Desai, section N. Andley and Rameshwar Nath, for appellant. I. N. Shroff, for the respondent. 99 1961. August 9. The judgment of the Court was delivered by SHAH, J. Pot No. 68 Town Planning Scheme No. 1 Jamalpur Ahmedabad, part of survey No. 405 Mouje Rajpur Hirpur admeasuring approximately 38 Gunthas was owned by, Bai Jekor and her two sisters. By a lease dated October 15, 1934, this plot of land was granted in lease by the owners in perpetuity to Gajjar Ramanlal Gordhandas and his brother at annual rental of Rs.558. The lesseesGajjars sublet by a lease dated February 7, 1946, the plot also in perpetuity to Narsaji Chenaji Marwadihereinafter referred to as the respondent at an annual rental of Rs. 1,425. The respondent by deed dated April 25, 1947, sublet the plot to Subhadra hereinafter referred to as the appellant it an annual rental of Rs. 2,225. In all these three deeds, it was recited that the lessees may construct buildings on the land and for obtaining sanction in that behalf, the lessors shall make applications to the Collector or any other authority for that purpose. The plot on the dates of the three leases was assessed for agricultural purposes. Under the Bombay Land Revenue Code V of 1879, land assessed for agricultural purposes may be used for non agricultural purpose if permission in that behalf is granted by the Collector. The appellant applied for permission for conversion of user of the land to non agricultural purposes, and the Collector of Ahmedabad by order dated November 11, 1949, sanctioned conversion of the user. Thereafter, the appellant by application dated October 27, 1950, applied to the Court of Small Causes., Ahmedabad for fixation of standard rent of the plot under section 11 of the Bombay Rents, Hotel and Lodging Houses Rates, Control Act 57 of 1947 hereinafter referred to as the Act. The respondent contended that the land when granted in lease being agricultural, the provisions of Bombay Act did not apply thereto ;ad the application, was not maintainable. The 100 Court of Small Causes upheld the contention of the respondent and dismissed the application. This order was confirmed in appeal to the District Court at Ahmedabad and in a revision application to the High Court of Judicature at Bombay. The, appellant has, with special leave, appealed to this court against the order of the High Court. It is common ground that till November 11, 1949, the plot was assessed for agricultural purposes under the Bombay Land Revenue Code. In the year 1947, the plot was undoubtedly lying fallow, but on that account, the user of the land cannot be deemed to be altered. User of the land could only be altered by the order of the Collector granted under section 65 of the Bombay Land Revenue Code. Section 11 of the Bombay Act 57 of 1947 enables a competent court upon application made to it for that purpose to fix standard rent of any premises. But s.11 is in Part 11 of the Act and by section 6 cl. (1), it is provided that in areas specified in Schedule I Part II applies to premises let for residence, education, business, trade or storage. There is no dispute that Part II applied to the area in which the plot is situate ; but before the appellant could maintain an application for fixation of standard rent under section 11, she had to establish that the plot of land leased was "premises" within the meaning of section 5 (8) of the Act and that it was let for residence, education, business, trade or storage. For the purposes of this appeal, it is unnecessary to consider whether the plot was let for residence, education, business, trade or storage. The expression ",premises" is defined by section 5 (8) and the material part of the definition is : "In this Act, unless there is anything repugnant to the subject or context x x x x (8) " 'premises" means (a) any land not being used for agricultural purposes, 101 (b) any building or part of a building let separately (other than a farm building) including (i) the garden, grounds, garages and out houses if any, appurtenant to such building or part of a building, (ii) any furniture I supplied by the landlord for use in such building or part of a building, (iii) any fittings affixed to such building or part of a building for the more beneficial enjoyment thereof. x x x x Reading section 5 sub cl. (8) with section 6(1), it is manifest that Part If of the Act can apply in areas specified in Sch. II to lands (not being used for agricultural purposes) let for residence, education, business, trade or storage. The material date for ascertaining whether the plot is " 'premises" for purposes of section 6 is the date of letting and not the date on which the application for fixation of standard rent is made by the tenant or the landlord. We agree with the High Court that the plot in dispute could not be regarded as "premises" inviting the application of Part II of the Act. The application filed by the appellant under section 11 for fixation of standard rent was therefore not maintainable, The appeal fails and is dismissed with costs. Appeal dismissed.

The owner of a certain plot of land granted a perpetual lease of it on an annual rent to some persons who sublet it to the respondent on a higher rent. The respondent sublet the plot to the appellant on a still higher rent. In all the three deeds of lease it was recited that the lessee might construct buildings on the land after obtaining sanction of the appropriate authority but on the dates of all the three leases the plot was assessed for agricultural purposes under the Bombay Land Revenue Code, 1879. The appellant obtained sanction of the Collector for conversion of user of the land to non agricultural purposes. The appellant thereafter applied to the court for fixation of standard rent of the plot under 's.11 of the Bombay Rents, Hotel and Lodging Houses Rates Control Act, 1947. The 'respondent contended that the land when granted in lease being agriculture I, the provisions of the Act did not apply thereto. The question which arose for decision was whether the plot of land was 'Premises ' within the meaning of s.5(8)of the Act. Held, that the material date for ascertaining whether the plot is 'premises ' is the date of letting and not the date of the application for fixing the standard rent. In the present case the plot in dispute could not be regarded as 'premises ' under section 5(8) of the Bombay Act on the date of letting and the application for fixation of standard rent was not maintainable.

Appeal No. 24 of 1961. APPeal from the judgment and order dated November 20, 1958, of the Bombay High Court in Special Civil Application No. 2789 of 1958. A.S. R. Chari and K. R. Choudhuri, for the appellants. S.T. Desai, and V. J. Merchant, for respondents Nos. 2 and 4 and the Intervener (The Bombay Incorporated Law Society). February 13, The Judgment of the Court was delivered by GAJENDRAGADKAR, J. This appeal arises out of a dispute between the appellants, the National Union of Commercial Employees & Anr, and the respondents Pereira, Fazalbhoy and Desai who constitute an Attorneys ' firm by name M/s. Pereira Fazalbhoy & Co. It appears that in August, 1957 159 the appellant wrote to the respondent firm setting forth certain demands on behalf of its employees. These demands related to bonus for the years 195556 and 1956 57 and to certain other matters. As the parties could not agree, the dispute was taken before the Conciliation Officer. The Conciliation Officer also failed to bring about a settlement and so he submitted his failure report to the Government of Bombay. Thereafter, the State Government referred the dispute in regard to the bonus for the two years 1956 and 1957 for adjudication before an Industrial tribunal under section 12(5) of the Industrial Disputes Act (No. 14 of 1947) (hereinafter called the Act). Before the Tribunal, the respondents raised a preliminary objection. They urged that the profession followed by them was not an industry within the meaning of the Act, and so the dispute raised against them by the appellants was not an industrial dispute within the meaning of the Act; the contention was that the dispute not being an industrial dispute under the Act, the reference made by the Government was incompetent and so, the Tribunal had no jurisdiction to adjudicate upon this dispute. The Tribunal upheld the preliminary objection and recorded its conclusion that it had no jurisdiction to adjudicate upon the dispute as it was not an industrial dispute. The order thus passed by the Tribunal was challenged by the appellants before the High Court at Bombay by special Civil Application No. 2789 of 1958 filed under Articles 226 and 227 of the Constitution. The High Court considered the rival contentions raised before it by the appellants and the respondents and came to the conclusion that the respondent 's firm did not constitute an industry and so the dispute between the said firm and its employees was nut ail industrial dispute which could validly form the subject matter of a reference under the Act. In that view of the matters the High Court hold that the Industrial Tribunal was 160 right in refusing to make an order on the reference and so the appellants ' writ petition was dismissed. The appellants then applied for and obtained a certificate from the High Court and it is with the said certificate that the present appeal has come to this Court; and the short question which it raises for our decision is whether the respondents ' firm which carries on the work of Solicitors in Bombay can be aid to constitute an industry under section 2(j) of the Act. In dealing with this question, it would be necessary to refer to the decision of this Court in the State of Bombay vs The Hospital Mazdoor Sabha (1). Both parties agreed that the present dispute would have to be determined in the light of the decision of this Court in that case. Let us, therefore, indicate the effect of the said decision. In the Hospital case (1), this Court had occasion to consider whether the services of workmen engaged as ward servants in the J.J. Group of Hospitals, Bombay, under State control were workmen and whether the Hospital Group itself constituted. an industry under the Act or not. Both the questions were answered in the affirmative and in rendering those answers, the scope and effect of the definition of the word industry ' used in section 2(j) of the Act was considered. This Court held that the words used by section 2 (j) in defining industry ' in an inclusive manner were of ' wide import and had to be read in their wide denotation. Even so, this Court stated "that though section 2(j) uses words of very wide denotation, a line would have to be drawn in a fair and just manner so as to exclude some callings, services or undertakings from its purview. If all the words used are given their widest meaning all services and all callings would come within the purview of the definition; even service rendered by a servant purely in a personal or domestic matter (1)[1960] 2 section C.; R.866. 161 or even in a casual way would fall within the definition. It is not and cannot be suggested that in its wide sweep the word "service ' is intended to include service howsoever rendered in whatsoever capacity and for whatsoever reason." (p. 876). That is why this Court proceeded to consider where the line should be drawn and what limitations can and should be reasonably implied in interpreting the wide words used in section 2(j). In dealing with the somewhat difficult question of drawing a line, this Court observed. ,"as a working principle, it may be stated that an activity systematically or habitually undertaken for the production or distribution of goods or for the rendering of material services to the community at large or a part of such community with the help of employees is an undertaking. Such an activity generally involves the co operation of the employer and the employees; and its object is the satisfaction of material human needs It must be organised or arranged in a manner in which trade or business is generally organised or arranged. It must not be casual nor must it be for oneself ' nor for pleasure. Thus, the manner in which the activity in question is organised or arranged, the condition of the (co operation between employer and the, employee necessary for its success and its object to render material service to the community can be regarded as some of the features which are distinctive of activities to which section 2 (1) applies." (P. 879). It was in the light of this working principle that this Court came to the conclusion that the State was carrying on an undertaking in running the Group of Hospitals in question In dealing with the question of hospitals, this Court also referred to a material circumstance which supported the conclusion that running of hospitals is an industry under the Act. Section 2 (n) of third Act defines "public utility service and under it five separate categories 162 of public utility service are enumerated. Clause (VI) of section 2 (n) provides that any industry specified in the Schedule as therein indicated would also be a public utility service. In 1956, Entry No. 9 among others, was added in the First Schedule specifying another public utility service. This Entry refers to service in hospitals and dispensaries. Therefore, it was clear that since the validity of this entry was not disputed, after service in hospitals and dispensaries was included in the First Schedule. it was inarguable that the hospital would not be an industry under the Act ; unless a hospital was an industry under the Act, service in the hospitals could not be regarded as public utility service. That is how this Court held that in running the J.J. Hospital Group in Bombay, the State , Government was carrying on an undertaking which was an industry under section 2(j). The question which calls for our decision in the present appeal is : what would be the result of the application of the working test laid down by this Court in the Hospital case 1 in relation to the controversy between the parties in the present appeal ? Mr. Chari for the appellants contends that in dealing with the question as to whether the respondents carried on an industry under a. 2 (j), it is necessary to distinguish between professional service rendered by an individual acting by himself and similar service rendered by a firm consisting of several partners, because he suggests that professional service individually rendered stands on a different footing from professional service which is rendered in an organised and institutionalised manner. The Organisation of professional service which leads to its institutionalisation attracts 'the provisions of section 2(j) inasmuch as in such organised service there is bound to be co operation between the employers and the employees engaged by the firm for doing different categories of work According to Mr Chari, the employment of (1) [1960] 2S.C.R. 86, 163 differentcategories of staff facilitates the work of the solicitors and it enables them to dispose of more work more quickly and more efficiently and he suggests that the presence of such co operation between the employees and their employers in the Organisation of the solicitors ' firm satisfies the working test laid down by this Court in the Hospital case(1). Tn our opinion, the distinction sought to be drawn by Mr. Chari between professional service rendered by an individual acting by himself and that rendered by a firm is not logical for the purPose of the application of the test in question. What is true about a firm of solicitors would be equally true about an individual Solicitor working by himself. the firm engages different categories of employees a single solicitor also engages different categories of employees to carry out different types of work and so the presence of co operation between the employees working in a solicitor 's office and their employers the solicitor, could be attributed to 'the work of a single solicitor as much as to the work of the firm ; and, therefore, if Mr. Chari is right and if the firm of solicitors is 'held to be an industry under the Act, the office of an individual solicitor cannot escape the application of the definition of section 2(j). That is why we think it would not be reasonable to deal with the matter on the narrow ground suggested by Mr. Chari by confining our attention to the organisational or institutionalised aspect of a solicitors firm. When in the Hospital case (1) this Court referred to the Organisation of the undertaking involving the co operation of capital and labour or the employer and his employees, it obviously meant the, cooperation essential and necessary for the purpose of rendering material service or for the Purpose of production. It would realised that the concept of industry postulates partnership (1) ; 164 between capital and labour or between the employer and his employees. It is under this partnership that the employer contributes his capital and the employees their labour and the joint contribution of capital and labour leads directly to the production which the industry has in view. In other words, the co operation between capital and labour or between the employer and his employees which is treated as a working test in determining whether any activity amounts to an industry, is the co. operation which is directly involved in the production of goods or in the rendering of service. It cannot be suggested that every form or aspect of human activity in which capital and labour cooperate or employer and employees assist each other is an industry. The distinguishing feature of an industry is that for the production of goods or for the rendering of service, co operation between capital and labour or between the employer and his employees must be direct and must be essential. Take, for instance, a textile mill. The employer contributes capital and installs the machinery requisite for the mills and the employees contribute their labour and by their cooperation assist the employer in producing the textile goods. When we refer to textile labour in relation to industrial disputes under the Act, we refer to workmen who are engaged in the work of producing textile goods. It is obvious that in regard to textile mills, a large majority of workmen concerned in carrying out the activities of most of the departments of the textile mills contribute directly in one form or another to the production of textile goods. It may be that even in a textile mill a very small minority of workmen may not be directly concerned with the production of textile goods ; but even so, their work is so integrally connected with the work carried on by the majority of workmen employed that they are treated as forming part of the same labour force. Thus, there can be no doubt that 165 when a textile mill is regarded as an industry, it is, because capital and labour jointly contribute to the ' production of goods which is the object of the mill. Let us consider the case of the hospitals. In ' the hospitals, the service to the patients begins with proper diagnosis followed by treatment, either medical or surgical, according to the requirements of the case. In the case of medical treatment, the patients receive medical treatment according to the prescription and are kept in the hospital for further treatment. In surgical cases the patients receive surgical treatment by way of operation and then are kept in the hospital for further treatment until they are discharged. During the period of such treatment, all their needs have to be attended to, food has to be supplied to them, nursing assistance has to be given to them, medical help from time to time has to be rendered and ail incidental services required. for their recovery have also to be rendered. Now, in the case of the activities of an organised Hospital, the co operation of the employees is thus directly involved in rendering one kind of service or another which it is the duty of the hospital to render. It is true that the patients are drawn to the hospitals primarily because of the doctors or surgeons associated with them. But there can be no doubt that the work of the hospital and its purpose are not achieved merely when a surgical operation is performed or medical prescription provided. After medical treatment is determined or a surgical operation is performed, the patient coming to a hospital as an indoor patient needs all kinds of medical assistance until he is discharged and the services rendered to him both initially and thereafter until his discharge are all services which the hospital has been established to render and it is in the rendering of the said services that the employees of the hospital co operate and play their part. That is how the test of cooperation between 166 the employer and his employees is satisfied in regard to hospitals which are properly organised and maintained. It is, of course, true that the quality, the importance and the nature of the service rendered by different categories of employees in a hospital would not be the same, but nevertheless, all the categories of service rendered by respective classes of employees in a hospital are essential for the purpose of giving service to the patients which is the objective of the hospital. That is how the hospitals satisfy the test of co operation between the employer and his employees. Does a solicitors ' firm satisfy that test ? Superficially considered, the solicitors ' firm is no doubt organised at; an industrial concern would be organised. There are different categories of servants employed by a firm, each category, being assigned separate duties and functions. But it must be remembered that the service rendered by it solicitor functioning either individually or working together with partners is service which is essentially individual ; it depends upon the professional equipment, knowledge and efficiency of the, solicitor concerned. Subsidiary work which is purely of an incidental type and which in intended to assist, the solicitor in doing his job has no direct relation to the professional service ultimately rendered by the solicitor. For his own convenience, a solicitor may employ a clerk because a. clerk would type his opinion ; for his convenience. , a solicitor may employ menial servant to keep his chamber clean and in order ; and it is likely that the number of clerks may be large if the concern is prosperous and so would be the number of menial servants. But the work done either by the typist or the stenographer or by the menial servant or other employees in a solicitor 's firm is not directly concerned with the service which the solicitor renders to his client and cannot, therefore, be said to 167 satisfy the test of co operation between the employer and the employees which is relevant to the purpose. There can be no doubt that for carrying on the work of a solicitor efficiently, accounts have to be kept and correspondence carried on and this work would need the employment of clerks and accountants. But has the work of the clerk who types correspondence or that of the accountant who keeps accounts any direct or essential nexus or connection with the advice which it is the duty of the solicitor to give to his client? The answer to this question must, in our opinion, be in the negative. There is, no doubt, a kind of co operation between the solicitor and his employees, but that co operation has no direct or immediate relation to the professional service which the solicitor renders to his client. Therefore, in our opinion it is difficult to accept the plea that a solicitor 's firm carrying on the work of an Attorney is an industry within the meaning of section 2(j). There is no doubt that the words used in section 2(1) are very wide, but as has been held by this Court in the can of Hospital is necessary to draw a line in a fair and just manner putting some limitation upon the width of the said words and a working test has been enunciated in that behalf. The application of the said teat to the facts in the present appeal leads to the conclusion that the work of solicitors Which the respondents are carrying on as a firm is not an industry under section 2(j) of the Act. That is the view taken by the Bombay High Court and we think, that view is right. It may be added that the same view has been taken by the Calcutta High Court in the case of Brij Mohan Bagaria vs N. C. Chaterjee (2) and D.P. Dunderdele vs G. P. Mukherjee(3 '). Looking at this question in a broad and general way, it is not easy to conceive that a liberal profession like that, of an. attorney could have been (1) (2) 1958 A.I.R. 1938 Cal. 460. (3) A.I.R.Cal. 168 intended by the Legislature to fall within the definition of "industry" under section 2(j). The very concept of the liberal professions has its own special and distinctive features which do not readily permit the inclusion of the liberal professions into the four corners of industrial law. The essential basis of an industrial dispute is that it is a dispute arising between capital and labour in enterprises where capital and labour combine to produce commodities or to render service. This essential basis would be absent in the case of liberal professions. A person following a liberal profession does not carry on his profession in any intelligible sense with the active co operation of his employees and the principal, if not the sole, capital which he brings into his profession is his special or peculiar intellectual and educational equipment. That is why on broad and general considerations which cannot be ignored, a liberal profession like that of an attorney must, we think, be deemed to be outside the definition of "industry" under section 2(j) In this connection, it would be useful to refer to the observation made by Isaccs and Rich JJ., in the Federated Municipal and Shire Council Employees ' Union of Australia vs Melbourne Corporation (1). "The concept of an industrial dispute", said the learned Judges. may thus be formulated: Industrial disputes occur when, in relation to operations in which capital and labour are contributed in cooperation for the satisfaction of human wants or desires, those engaged in co operation dispute as to the basis to be observed, by the parties engaged, respecting either a share of the product or any other terms and conditions of their co operation. This formula excludes the two extreme contentions of the claimant and the respondents respectively. It excludes, for instance, the legal and the medical professions, because they are not carried on in any intelligible sense by the Cooperation of (1) (1919)26C.L.R.508,554. 169 capital and labour and do not come within the sphere of industrialism. It includes, where the necessary co operation exists, disputes between employers and employees, employees and employees, and employers and employers. It implies that "industry" to lead to an industrial dispute, is not, as the claimant contends, merely industry in the abstract sense, as if it alone effected the result, but it must be acting and be considered.in association with its co operator "capital" in some form so that the result is, in a sense, the outcome of their combined efforts". Those observations support the view which we hive taken about the character of co operation between the employer and employees which affords a relevant test in determining whether the enterprise in question is an industry or not. Co operation to which the test refers must be co operation between the employer and his employees which is essential for carrying out the purpose of the enterprise and the service to be rendered by the enterprise should be the direct outcome of the combined efforts of the employer and the employees. There is one more minor point which still remains to be considered. Mr. Chari argued that it would be idle for the respondents to contend. that the work of their firm is not an industry under a. (2j) because they have themselves described their work as the work of carrying on business of solicitors. It appears that the document of partnership executed between the different partners of the firm provided, inter alia, that all expenses of the business of the partnership or losses incurred in carrying on the business of the partnership shall be. borne out of the profits or capital of the partnership. It is on the use of the word "business" in this clause that Mr. Chari relies. In support of his argument,he referred us to a decision of Farwell, J., in Dickson vs Jones (1). In that case, the Court was concerned to examine the validity of an agreement between the, plaintiff, solicitor, and his junior clerk, who (1) 170 was subsequently articled to him. This agreement provided that the latter would not ,,at, any time hereafter practice as a solicitor within a radious of 15 miles from the Town Hall, Hanley, aforesaid, or solicit any client of the solicitor". Farwell J., held that "the combination of a restriction over an area so great as a radious 15 miles and one extending to the whole life of the defendant, articled clerk, was, in the circumstances, wider than was necessary for the protection of the plaintiff and was, therefore, unenforceable as being in Undue restraint of trade". The argument is that the validity of an agreement between a solicitor and his articled clerk was tested on the ground that it was an agreement in restraint of trade, and so the solicitor 's work must be held to be a " 'trade," under section 2(j). There is obviously no force in this argument. If in their deed of partnership the respondents described the work of partnership as the business of solicitors, that can hardly assist the appellants in contending that the work carried on by the firm is industry under section 2(j). The work of a solicitor is, in a loose sense, of course, of business, and so if the solicitors entered into an agreement in restraint of trade, its validity would have to be judged on the basis that their work in the nature of business. That, however, is hardly relevant in determining the question as to whether the said work is an industry under section 2(j); as we have already made it clear, the definition of the word , 'industry" is couched in words of very wide denotation. But that precisely is the reason ,why a line has to be drawn in a just and fair manner to demarcate the limitations of their scope and that necessarily leads to the adoption of some working test. Therefore, in our opinion, the argument that the respondents themselves have called their work as "business" is of no assistance. The result is, the appeal fails; there would be no order as to costs. Appeal dismissed.

The respondents were a firm carrying on the work of solicitors in Bombay. For the years 1956 and 1957 a claim for bonus was made against them by their employees. Before. the Industrial Tribunal to which the dispute was referred by the State Government for adjudication under the provisions of the , the respondents contended that the profession followed by them was not an industry within the meaning of section 2(j) of the Act, that the dispute raised against them was not an industrial dispute under the Act, and that, therefore, the reference made by the Government was incompetent. Held, that the work of solicitors is not an industry within the meaning of section 2(j) of the , and that, therefore, any dispute raised by the employees of 158 the solicitors against them cannot be made the subject of reference to the Industrial Tribunal. The distinguishing feature of an industry is that for the production of goods or for the rendering of service, co operation between capital and labour or between the employer and his employee must be direct. A person following a liberal profession does not carry on his profession in any intelligible sense with the active co operation of his employees, and the principal, if not the sole, capital which he brings into his profession is his special or peculiar intellectual and educational equipment. Consequently, a liberal profession like that of a solicitor is outside the definition of "industry" under section 2(j) of the Act. State of Bombay vs The Hospital Mazdoor Sabha, ; , explained and distinguished. Brij Mohan Bagaria vs N.(,. Chatterjee, A.I.R. 1958 Cal. 460 and D. P. Dunderdele vs G. P. Mukherjee, A. 1. R. , approved. Observations in Federated Municipal and Shire Council Employees ' Union of Australia vs Melbourne Corporation, ; , relied on.

Appeal No. 306 of 1961. 198 Appeal by special leave from the Judgment and order dated May 16. , 1959, of the Industrial Court Bombay, in Appeal (I.C.) No. 90 of 1959. J.P. Mehta and I.N. Shroff, for the appellant. N.M. Barot, Secretary, Labour Association, for the respondent No. 3. 1962. February 15. The Judgment of the Court was delivered by GAJENDRAGADKAR, J. The appellant, the Fine Knitting Co. Ltd., was incorporated in 1908 and its principal activity then Was to Manufacture hosiery. In 1924, when the appellant shifted its factory from. Barejadi to Ahmedabad, it installed spinning machinery with 9000 spindles with a view to ensure suitable and even supply of yarn for its hosiery manufacture. On May 30, 1939, the Government of Bombay issued a notification under the Bombay Industrial Disputes Act, 1938 (No. XXV of 1938), whereby hosiery concerns were included in the definition of 'Cotton Textile Industry '. Subsequently on July 17, 1945, another notification was issued as a result of which the hosiery manufacture was excluded from the Cotton Textile Industry and it was covered by a separate notification issued under the said Act. This latter notification which was made applicable to the Hosiery Industry specified that the said notification inter alia, to all concerns using power and employing twenty or more persons which are engaged in the manufacture of hosiery or other knitted articles made of cotton and all processes incidental or supplementary thereto. After this notification was issued, the appellant ceased to be covered by the extended and inclusive definition of the 'Cotton Textile Industry ' and was recognised as a Hosiery concern being engaged in the Manu facture of hosiery. Later, in 1946, the Bombay Industrial Relations Act, 1946 (No. XI of 1947) (hereinafter called the Act.), was applied to the 199 industries to which the Bombay Industrial Disputes Act bad been applied, as a result of s.2(3) of the former Act. In consequence, for the purposes of the Act, the appellant concern was recognised as an undertaking of the Hosiery Industry under section 11 This was the result of notification No. 10 of 1948, issued by the Registrar under the Act. This position was recognised by the Industrial Tribunal in indus trial adjudications concerning disputes between the appellant and its workmen. Even so, respondent No. 3, the Textile Labour Association, Ahmedabad, sought to reopen the issue by applying by to the Registrar on October 16 1953, that the appellant 's factory should be recognised as an undertaking both in the Cotton Textile Industry and the Hosiery Industry. The Registrar who is the second respondent in the present appeal hold an enquiry and ultimately came to the conclusion that there was no justification for splitting up the concern into two units and recognising them as suggested by the third respondent. The third respondent did not prefer an appeal against the said decision of the second respondent; but respondent No. 4 who are the five elected representatives of the employees of the appellant sought to challenge the said decision of the second respondent by preferring an appeal to the Industrial Court, respondent No. 1. The appellant contended that respondent No. 4 were not entitled to prefer an appeal because they were not parties to the proceedings in the original application before the second respondent. This preliminary objection was upheld and the appeal preferred by respondent No. 4 was dismissed. The result was that the order passed by the Registrar rejecting the application made by respondent No. 3 concluded the dispute. Even while the said appeal was pending before the first respondent, respondents Nos. 3 and 4 200 initiated the present proceedings by means of two applications made before the second respondent in which the same relief was claimed that the appellant concern should be recognised as an undertaking both in the Cotton Textile Industry and in the Hosiery Industry. The second respondent, however, rejected these applications on the ground that since he gave his earlier decision, there had been no change of circumstances and so there was no justi fication for reconsidering the matter over again. The third and the fourth respondents then went in appeal before the first respondent and their appeals were allowed by the first respondent and a direction was issued that the appellant company should be recognised as two undertakings one in the Cotton Textile Industry and the other in the Hosiery Industry. The appellant then moved the High Court of Bombay under Articles 226 and 227 of the Constitution and challenged the validity of the order passed by the first respondent. , In the High Court the parties took an order by consent on August 20, 1958. As a result of this consent order, the direction issued by the first respondent was set aside and the matter was remanded to the second respondent to enable him to hold a fresh enquiry and to dispose of the dispute between the parties in accordance with law. On February 14, 1959, the second respondent pronounced his decision. He came to the conclusion that in the circumstances disclosed on evidence, the best courts would be to recognise the spinning and hosiery sections of the appellant company as two separate undertaking and treat them as two separate enterprises. That is why under section 11(1) he decided to recognise the Fine Knitting Co. Ltd. (Hosiery Section) and the Fine Knitting Co. Ltd. (excluding Hosiery Section) as undertakings in the Hosiery Industry and the Cotton Textile Industry respectively The appellant was aggrieved by this order and so is preferred appeals before the first 201 respondent. The respondents Nos. 3 and 4 also challenged the decision of the second respondent and contended that the entire concern of the appellant should be treated as Cotton Textile Undertaking. All the three appeals failed and the first respondent confirmed the order passed by the ,second respondent. The result is that the appellant concern is recognised as consisting of two undertakings, the Hosiery Section and the rest excluding the Hosiery Section. It is against this order of the first respondent that the appellant has come to this Court by special leave. The first point which Mr. Mehta has strenuously urged before us on behalf of the appellant is that on a proper application of the tests laid down by this Court, it should be held that the spinning and the Hosiery Sections in the appellant 's establishment are one concern and in support of this argument he has referred us to the decisions in the Associated Cement Companies Ltd. vs Their Workmen(1), Pratap Press vs Their Workmen (2) and Pakshiraja Studios V. Its Workmen (3). This question has been recently considered by this Court in the case of the Honorary Secretary, The South India Millowners ' Association vs ' The Secretary,Coimbatore District Textile Workers ' Union, Coimbatore (1). in which judgment has been pronounced on February 1, 1962. In the last mentioned case, this Court has examined the relevant earlier decisions and has come to the conclusion that though the question about the unity of two industrial establishments has to be considered in the light of the relevant tests laid down from time to time, it would be unreasonable to treat any one of the said tests as decisive. As has been observed in that case, in dealing with the problem, several factors are relevant, but it must be remem bered that the significance of the several factors (1) [1960) I S.C.R. 703. (3) [19611 (2) [1960] I. L.L,J. 497. (4) [1962] Supp. 2 S.C R. 925 202 would not be the same in each case nor their importance. It is in the light of these decisions that the point raised by Mr. Mehta has to be considered . Mr. Mehta contends that in the present case there is unity of ownership and as a necessary corollary, there is unity of management , supervision and control; there is unity of purpose and design and he argues that there is complete functional integration. According to him , as no hosiery could be maufactured without yarn, there is such a functional unter dependence between the cannot exist without the former. There is also unity of finance and in consequence, there is one capital and depreciation fund account, of expenditure and income, one balance sheet and one profit and loss account . There is also unity of employment and the two concerns functions under the same roof; so there is unity of habitiation . It is on these grounds that Mr. Mehta contends that the first and the second respondents were in error in splitting up the appellant 's establishment into two sections and recoginsing them separately as such. In dealing with the significance and the effect of the factors on which Mr. Mehta has righlty relied it is necessary to bear in mind certain other relevant factors on which the decision under appeal is substantially based. It is true that in 1924, the spinning section of the establishment may have begun as a subsidiary to the hosiery section and in order to serve as its feeder. But the evidence on the record clearly shows that the position is now reversed and that the spinning section has now assumed major importance and hosiery takes a minor place in the industrial activities of the app minor place in the industrial activities of the appellant. The inspection notes made by the second respondent show that it was admitted by the 203 management that the spinning, section has now developed to such an extent that it is like aspinning mill by itself; it can no longer be regarded as a minor, section attached to the hosiery works. It was conceded before the second respondent that only about 20% of the yarn manufactured in the spinning section is consumed for hosiery purposes while the rest is available to be sold in the market. The production. figures in the spinning section and the consumption of the yarn produced in that section unmistakably point to the fact that the spinning section is no longer a minor department run by the appellant solely for the purpose of its hosiery section. ID 1955 in the months of November and December, the production in the Spinning department was worth Rs. 1,17,742 whereas whatever was consumed in the knitting department was only Rs. 23,817 leaving a balance which was sold for Rs. 93,925. The corresponding figures for the year, 1956 are Rs. 6,70,854, Rs. 1,40,105 and Rs.5 30,749. Similar figures for 1957 are Rs.8, 17, 153, Rs. 1,31,725 and Rs. 7,04,018 and for 1958 are Rs. 6,68,095, Rs. 1,26,252 and Rs. 5,40,873. The balance sheet for the year 1954 shows that the total hosiery sale was worth Rs. 2,37,232 6 0 whereas the total yarn sale was worth Rs. 14,82,705 5 0. Similarly, for the year. 1955, the, hosiery sale was kW. 2 56,986 and the yarn :sale was Rs. 14,44,929. strength of the employees engaged in the two respective sectors tells the same story. The table prepared by the second respondent from the information supplied by the management shows that for the year 1955, spinning employees were 174, hosiery employees 56 and the common workmen 35. For the year 1956, the figures were 217, 54 and 38; for 1957, the figures were 194, 65 and 38; and for 1958 the figures were 178, 60 and 32. Mr. Mehta quarrels with some of these figure but does not dispute the broad conclusion which is drawn from the figures that the number of employees engaged in the spinning section is far more 204 than that employed in the hosiery section. Thus, there can be no doubt that the spinning activity of the, appellant which may have begun as subsidiary to the hosiery activity has now grown in importance and has taken a place of pride in the industrial activity of the appellant considered as a whole; it can no longer be regarded as subsidiary to hosiery. It is common ground that by the notification issued under the Cotton Textile (Control) Order, 1948, the appellant is called upon to supply to the Government the prescribed quantity of yarn produced by the spinning department. It is unnecessary to refer to the details of the order or to the extent of the yarn required to be supplied by the appellant under it. What is significant is the fact that by the application of the order issued in that behalf, the Government has treated the appellant as a producer who has a spinning plant and in that sense, the existence of the spinning activity of the appellant has been treated as an independent activity liable to be controlled by the notification issued under the Cotton Textile (Control) Order, 1948. Then as to the argument that the spinning and the hosiery are functionally integrated, it is clear that hosiery can exist without spinning, provided the industry engaged in hosiery purchases yarn required for the purpose of hosiery. That is one aspect of the matter. But the more important aspect on which reliance has been placed against the appellant is that the appellant 's spinning department produces yarn of all counts some of which would admittedly not be useful for hosiery work. When the appellant was asked whether the allegation made by respondents Nos. 3 and 4 in that behalf was true or not, the management of the app ellant hesitatingly denied the said allegation. But an advertisement published in the local daily "Sandesh" was produced by respondents Nos. 3 205 and 4 and it clearly showed that yarn of all counts was offered by the appellant for sale in the general market. Therefore, it would be idle to contend that the spinning work carried on in the spinning department is meant exclusively or solely for the hosiery department. If the spinning department produces yarn which is not useful or necessary for, and which cannot be used by, the hosiery sections the only inference is that the spinning department is working on its own and is producing yarn to be sold in the market. That being so, the argument of functional inter dependence or integrality cannot be treated as valid. Besides, it is not disputed that when the knitting department was closed in 1948, the spinning department was not. If the two departments are functionally inter dependent, the closure of the one without the closure of the other may need an explanation. The explanation which has appealed to the first and the second respondents apparently is that though the spinning work carried on by the appellant may, to some extent, be useful for the hosiery work, the major part of its work is carried on independently with an eye on the market and so the closure of the hosiery cannot and did not affect the continuance of the spinning department. There is yet another circumstance on which considerable reliance has been placed by the first and second respondents in rejecting the appellant 's contention that the two departments constitute one unit. This circumstance refers to the conduct of the appellant itself in dealing with the employees engaged in spinning and in knitting departments. It is admitted that the minimum wages paid to the employees in knitting differed from the minimum wages paid to the employees in spinning and so does the amount of dearness allowance paid to the respective employees differ. It is difficult to understand how an employer can make a distinction ui 206 the payment of minimum wages between one class of employees and another if both the classes of employees are engaged in different departments Of the same establishment or concern. If there is unity of employment and unity of purpose and design as suggested by Mr. Mehta, it is inconceivable that the employees engaged in two departments integrally connected with each other and constituting one unit would be paid different minimum wages. What is true about the minimum wages and the dearness allowance is also true about the bonus. It appears that even in years in which the appellant made profits and actually paid bonus to the work men employed in the spinning department, no bonus was paid to the employees engaged in the knitting department. That again can be explained and justified only on the basis that the appellant treated the two departments as distinct and separate and so the employees in the one got bonus and not the employees in the other. It was suggested by Mr. Metha that the genesis of the present dispute lies in the anxiety of the third respondent to take within its jurisdiction the employees engaged by the appellant in its spinning depart ment. On the other hand, Mr. Barot for respondents Nos. 3 and 4 contends that the present trouble arose because the appellant began to deny to its employees in the spinning department the benefits of all relevant conditions of service which were applicable to the employees in the Textile Industry in Ahmedabad. Whatever may be the background of the dispute and its genesis, it is clear beyond doubt that the way in which the appellant has treated its employees in spinning is distinguished from its employees in knitting leads very strongly to the inference that the, appellant treated the two departments not as one unit but as separate units each one functioning on its own and independently of the other. It is in the light of these circumstances that 207 the first and the second respondents were not impressed by the relevant factors on which the appellant relied in support of its plea of the unity of the two activities and came to the conclusion that the two activities were separate and as such, as must be separately recognised under, section 11. We do not see how the appellant can successfully challenge the correctness of this conclusion. There is one more point which yet remains to be considered. Mr. Metha argues that the impugned order recognising two different undertakings under section 11(1) is not justified by the provisions of the statute. Section II provides that the Registrar may, after making such inquiry as he deems fit, recognise for the purposes of the Act (1) any concern in an industry to be an undertaking ; (2) any section of an undertaking to be an occupation. The argument is that section II (1) does not authorise the splitting up of a concern into two undertakings. A concern, says Mr. Metha, is the whole of the concern or establishment run by the appellant and as such it has to be recognised as one undertaking in so far as the order under appeal treats the appellant 's concern as two undertakings, it is contrary to section 11(1). We are not impress,, (I by this argument. The appellant is undoubtedly engaged in the hosiery industry and that part of its business cannot be recognised as Cotton Textile Industry because it is a concern engaged in spinning only which can be recognised under that category. If that is so, industrial activity of the appellant in relation to hosiery industry must be recognised separately from the textile undertaking. If one concern or company carries on several businesses or undertakes different types of industrial works, these businesses or works would amount to separate enterprises or undertakings and would have to be 208 recognised as such. In fact, if the appellant itself has been treating the two kinds of work separately and has thus split up its whole business into two independent sections, it is not easy to understand why the Registrar cannot recognise the existence of two undertakings carried on by the appellant and treat the said undertakings as such. We see no justification for the assumption made by Mr. Metha that section II (1) does not permit the recognition, of several undertakings carried on by the same company separately. It all depends on whether the undertakings are separate, distinct and independent of each other or are functionally integral or inter dependent. In the former case, the Registrar would be, justified in treating the several undertakings separately while in the latter case, he may recognise all of them as one undertaking. There is one minor point to which reference may incidentally be made. It appears that before the first respondent, it was urged by the appellant that the present applications made by respondents Nos. 3 and 4 were barred by res judicata. The argument was that since the second respondent had on an earlier occassion considered the merits of the case and refused to grant the request made by the third respondent for recognising the two undertakings separately, the same question could not be re agitated again before the same authority. In our opinion, there is no substance in this argument. As we have already pointed out, when the second respondent passed his earlier order, an appeal was preferred against the said order by the fourth respondent before the first respondent. That appeal was, however, dismissed on the ground that the fourth respondent was not party to the proceedings before the second respondent and, therefore, he could not prefer an appeal. If the fourth respondent had no right to make an appeal because he was not a party. to the said. proceedings, it is difficult to see, how he can 209 be precluded from making the present application on the ground of res judicata. At the highest, a plea of res judicata pay perhaps be raised against the third respondent but that would not be effective in view of the fact that in the present case, an application has been made by the fourth respondent as well. That is why Mr. Mehta did not seriously press the point of res judicata before us. In the result, fails the appeal and is dismissed with costs. Appeal dismissed.

The appellant Company was incorporated in 1908 and its principal activity then was to manufacture hosiery. In 1924 when the appellant shifted its factor to Ahmedabad it installed spinning machinery with a view to ensure suitable and even supply of yarn for its hosiery manufacture. Originally, a notification had been issued on May 30, 1939, under the Bombay Industrial Dispute Act, 1938, whereby hosiery concerns were included in the definition of "Cotton Textile Industry",, but subsequently on,July 17, 1945, another notification was issued as a result of which the Hosiery manufacture was excluded from the Cotton Textile Industry and it was covered by a separate notification. For the purposes of the Bombay Industrial Relations Act, 1946, the appellant concern was recognised as an undertaking of the hosiery industry by the Registrar under section II of that Act. Subsequently as a result of certain proceedings taken by the Textile Lobour Association of Ahmedabad, the Registrar decided 197 to recognise the appellant concern as consisting of two undertakings, the hosiery section and the rest excluding the hosiery section and this decision was confirmed by the Industrial Court. The appellant challenged the order of the Industrial Court on the grounds (1) that the spinning and the hosiery sections in its establishment were one concern because (a) there was unity of ownership, management, supervision, con trol and employment, (b) there was complete functional integration, and (c) the two sections were functioning under the same roof, and (2) that, in any case, section 11 of the Act did not authorise the splitting up of a concern into two undertakings. The evidence showed that though in 1924 the spinning section had begun as a subsidiary to the hosiery section in order to serve as its feeder, later on the spinning section developed to such an extent that it became a spinning mill by itself and could no longer be regarded as a minor section attached to the hosiery works, that only 20% of the yarn manufactured by the spinning section was con sumed for hosiery purposes while the rest was sold in the market, that the spinning department produced yarn of all counts, some of which could not be used for hosiery work, that when the knitting department was closed in '1948, the spinning department was not. It was also found that the amount paid to the employees in each of the two departments by way of minimum wages and dearness allowance was different. Held, that the decision of the Registrar recognising the hosiery and spinning departments of the appellant concern as separate undertakings under s.11 of the Bombay Industrial Relations Act, 1946, was correct, Held, further, that the question whether the several undertakings carried on by the same company are separate or not depends on whether they arc distinct and independent of each other or are functionally integral or inter department and that the Registrar was within his powers under section II of the Act to come to a decision on this question on the basis of the circumstances disclosed on evidence. Associated Cement Companies Ltd. vs Their Workmen, (1960) 1 S.C.R.703, Pratap Press vs Their Workmen, (1960) 1 L. L. J. 497 Pakshiraja Studios vs Its Workmen. and Honorary Secretary, The Soath India Millowrers 'Asso ciation vs The Secretary Coimbatore District Textile Workers ' Union, Coimbotore (1962) Supp. 2, S.C.R. 926 relied on.

Appeal No. 131 of 1961. Appeal from the judgment and decree dated September 30, 1957, of the Kerala High Court in Appeal suit No. 19 of 1956 (T). T. N. Subramania lyer, R. Mahalingier and M.R. Krishna Pillai, for the appellant. V. A. Seyid Muhammed for the respondent. September 14. The judgment of the Court was delivered by KAPUR, J. It is not necessary for me to give the facts of this case as they are set out in detail in the 65 judgments of my learned brethern Sarkar & Hidayatullah, JJ. In my opinion this appeal should be dismissed and my reasons are these On the findings of the High Court it appears that the Bank had agreed to allow an overdraft to defendant No. 1 for Rs. 20,000/ , that the appellant gave a surety bond for the repayment of Rs. 25,000/ and when that was pointed out to defendant No. 1, the principal debtor, lie (the latter) made the alteration in the document by reducing the figure of Rs. 25,000/ to Rs. 20,000/ The case of the appellant was not that he never stood surety for defendant No. 1 but that he stood surety for Rs. 25,000/ which was subsequently altered to Rs. 20,000/ and that any change of figure was a material alteration resulting in the avoidance of the contract, even though the alteration might have been advantageous to him, the obliger. It was argued that howsoever innocent the obligee might be or howsoever innocent the alteration might have been made so far as it is material the non accepting obliger the appel lant in this case cannot be held liable on the obligation in the altered form because he never made be consented to such an obligation and he can not be held liable on the obligation in the original form because the obligation was never assented to by the creditor respondent Bank. Now an unauthorised material alteration avoids a contract so that if a promisee after a written contract has been executed materially alters it without the consent of the promisor whether by adding anything to the contract or striking out any part of it or otherwise the contract is avoided as against the person who was otherwise liable upon it (Halsbury 's laws of England, 3rd Edn., Vol. 8, para 301, p. 176). It may also be taken to be the law that even if the alteration is made by a stranger without the knowledge of the promisee the other party is discharged if the contract is in possession of the promisee or his agent. But if the contract is altered 66 by a stranger when the contract was not in the custody of the promisee the promisor is not discharged. (Halsbury 's Laws of England, 3rd Edn., Vol. 8, para 301, p. '176). There is also a further qualification and that is that if a guarantor entrusts a, letter of guarantee to the principal borrower and the principal borrower makes an alteration without the assent of the appellant then the Guarantor is liable because it is due to the act of the guarantor that the letter of guarantee remains with the principal debtor, in this case defendant No. 1, and what the principal debtor did will estop the guarantor from pleading want of authority (Williston on Contract, Vol. para 1914, P.5354). Thus the position in the present case comes to this. The appellant agreed to stand surety for an overdraft allowed by the respondent Bank to the principal debtor, Shankaran. The Bank required a guarantee in the form which was handed over to the principal debtor, Shankaran. Shankaran got it filled by the appellant for a sum of Rs. 25,000/ . The Bank did not accept the guarantee up to that limit but wanted the figure to be corrected i.e. by insertion of Rs. 20 000/ . The document was there upon handed back to the principal debtor who, it is stated, altered the document. At that stage the principal debtor was acting for and on behalf of the appellant because it was at his instance that the appellant was standing surety and the appellant handed over the deed of guarantee to the principal debtor for the pur poses of being given to the balik, the respondent. In these circumstances the avoidance of contract by material alteration is in applicable because the document was not altered while in possession of the promisee or its agent but was altered by the principal debtor who was at the time acting as the agent of the guarantor, the appellant. In these circumstances the plea of material alternation is of no avail to the appellant and the 67 appeal must therefore fail and is dismissed but no order as to costs. SARKAR, J. This appeal arises out of a suit filed by the respondent Bank against the appellant as the guarantor and one Sankaran as the principal debtor, to recover moneys advanced to the latter on an overdraft account. The suit was decreed against Sankaran by the trial Court and he never, appealed from that decree. We will, therefore, be concerned in this appeal only with the claim against the appellant. The suit against the appellant was based on a letter of guarantee dated May 24, 1947. It was stated in the plaint that by this letter of guarantee the appellant had undertaken to repay to the Bank the balance due on the overdraft account opened in favour of Sankaran, up to a maximum of Rs. 20,0001/ which was also the maximum amount for which the overdraft had been arranged. The appellant 's defence to the suit was that he had agreed to guarantee the liability of Sankaran on the overdraft up to Rs. 5,000/ and had signed the letter guaranteeing thereby repayment up to that sum but the letter had been altered .without his consent by substituting Rs. 20,000/ for Rs. 5,000/ . The appellant contended in the courts below that as this was a material alteration of the instrument of ' guarantee. he was absolved of ill liability on it. The trial court found, that the amount guaranteed had originally been mentioned in the letter as Rs. 25,000/ and this had been altered without the consent of the appellant to Rs. 20,000/ . It observed that as it was not disputed that the alteration was material, the suit against the appellant had to be dismissed and passed a decree accordingly, obviously in the view that the alteration had avoided the instrument. The respondent Bank then appealed to the High Court of Kerala, the High Court agreed with the trip 68 court that the letter of guarantee originally mentioned Rs. 25,000/ and this figure was later altered to Rs.20,000/ without the consent of the appellant. It .added that probably the alteration had been made by the principal debtor, Sankaran. It however held that the appellant had mentioned Rs. 25,000/ in the place of Rs. 20,000/ in the letter probably by a mistake and that the alteration had been made in order to carry out the common intention of Sankaran, the appellant and the Bank that for the overdraft accommodation of Rs. 20,000/ allowed to Sankaran the appellant would give a letter of guarantee to the Bank. In this view of the matter the High Court, relying on the principle contained in section 87 of the , passed a decree against the appellant. The appellant has come up to this Court in appeal against the judgment of the High Court. Unfortunately, the Bank, for reasons unknown to us, has not appeared in this appeal. Dr. Seiyid Muhammed argued the case for the Bank at our request and has rendered us great assistance. Now, the provision of the on which the High Court relied in terms applies to a negotiable instrument which a letter of guarantee is not. The principle of that provision may however be of wider application. That principle has been formulated in Halsbury 's Laws of England, 3rd edn., vol. 11, p. 370, in the following words : "An alteration made in a deed, after its execution, in some particular which is not material does not in any way affect the validity of the deed;. . . It appears that an alteration is not material . . . 'Which carries out the intention of the parties already apparent on the face of the deed. It is now well settled that, this principle applies to instruments under hand also : see ibid 69 p. 380, f. n. (c) and Master vs Miller, (1791) 4. Term Rep. 320. The question then is, was the alteration in the letter of guarantee of the kind contemplated by this principle. The learned judges of the High Court thought it was and so held that the letter of guarantee as altered could be enforced. I am unable to accede to that view. It seems to me that the intention to carry out which an alteration is permissible under the rule on which the High Court has relied, is the intention with which the instrument was executed. That is why in formulating the rule it has been stated in Halsbury 's Laws of England that the intention has to be "already apparent on the face of the deed". I need only refer to the observation of Le Blanc, J., in Knill vs Williams(1) in support of this proposition, "If I had thought that there was any evidence on which the jury might have found that the words afterwards added had been originally intended to have have been inserted, and were omitted by mistake, I 'Should certainly have left it to them so to find; the case of Kershaw vs Cox(2) being then fresh in my mind; but. according to my recollection of the evidence, it was impossible for them to draw that conclusion from it. The opinion which I delivered in Karshaw vs Cox can only be supported on the ground that the alteration there made in the bill the day after it was negotiated was merely the correction of a mistake made by the drawer of it, in having omitted the words, 'or order ', which it was intended at the time should be inserted. " The two cases on which the learned judges of the High Court relied are also cases where the mistake was in writing the instrument. In Lachmi Rai vs Srideo Rai(3) it was found that "the omission regarding the payment of interest was accidental" and in Ananda Mohan Saha vs Ananda Chandra Naha(4) where (1) ; (1809) 10 East. 931; (2) 3 Esp. N. Cas. 246. (3) A. I. R. 1939 All. (4) (1916) 1. L. R. 70 the instrument originally provided for interest on 'a loan of Rs. 200/ at Rs. 1/ per mensem and had been altered by the addition of the words "per cent", ' it was said "that it was the intention of the parties, as ' it seems to me to be obvious upon reading the document, that interest was to be paid at the rate of 'one rupee per cent. per mensem". It seems to me that if it were not so and the intention contemplated in the rule could be gathered from a pre existing agreement alone without caring to find out the intention with which the instrument was executed, then there would be no justification for the rule. It would then warrant the alteration of an instrument intentionally written in variance with the pre existing agreement which a person was in law free to do, by the other party to it. That would amount to making a new contract out of a written instrument by unilateral action and in disregard of the intention of the writer. For such a position our laws make no provision. It may be that a person who writes a document in terms which deliberately depart from the agreement pursuant to which it is written, may be liable on that agreement but he cannot be made liable on the document as altered by the other party to the agreement alone even though such alteration makes the document consonant with the agreement. Now there is absolutely no evidence in this case that in writing the letter of guarantee the appellant had intended to mention the maximum amount of guarantee as Rs. 20,400/ and had by mistake written Rs. 25,000/ instead. In holding that there was such a mistake, the High Court proceeded purely on the basis of conjecture which is evident from the language used by it. It said, "probably defendent 2" (the appellant) "made a mistake in Ext. C" (the letter of guarantee). There was not the slightest warranty for; this conjecture. In fact the evidence indicates that Rs. 25,000/ had been mentioned intentionally in the letter of guarantee. That evidence was given by the 71 Banks agents too. , He said that the overdraft arrangement commenced on February 24, 1947, when Sankaran executed a promissory note for Rs. 20,O00/ in favour of the Bank. At that time the appellant was not available to sign the letter of guarantee. The letter was typed by the Bank with blank spaces left for entries to be made by the guarantor regarding the maximum limit of the account, the rate of interest, and the date. Sankaran brought this letter back to the Bank in May 1947. At that time the space for the amount of the limit was filled up with the figure Rs.25,000/ . Sankaran said that he required Rs.25,000/ and would renew the promissory note for that amount. The Bank was not prepared to advance to him more than Rs. 20,000/ and so the letter of guarantee was returned to Sankaran who then took it away and brought it back some time later with the amount of the maximum limit corrected to Rs. 20,000/ . This is all the evidence on the question. I think it right to point out here that the Bank 's agent did not speak to any oral agreement with the appellant, nor indeed to any interview with him concerning the overdraft arrangement or the guarantee. The appellant in his written statement no doubt admitted that he had agreed to guarantee the due repayment of the overdraft up to Rs. 5,000/ . He did not however say that the agreement was verbal but mentioned the letter of guarantee. The appellant 's admission can of course be taken against him but it must be taken as made and not a part of it only. Again, no verbal agreement concerning the guarantee had been pleaded anywhere by the Bank, not even in the application that it filed in answer to the. written statement of the appellant alleging that the letter of guarantee, having been materially altered no suit lay on it. , Lastly, I have to observe that the trial court did not find,that any such oral agreement had been made. If there ' had been any agreement, the letter of guarantee as typed. out would have contained no blanks. 72 In these circumstances it is impossible to hold that there was any prior agreement about the guarantee or its limit, between the appellant and the Bank, and if there was not, the High Court 's view that in the letter of guarantee Rs. 25,000/ had been mentioned by mistake, would lose its foundation. But even assuming a preexisting verbal agreement and in this case the agreement, if any, could only be verbal the fact that Sankaran made a request that the amount of the overdraft should be increased to Rs. 25,000/ would rather indicate that the letter of guarantee had intentionally stated Rs. 25,000/ as the amount of guarantee and this figure had not been written by any mistake. It would be impossible to hold on this evidence that there had been any mistake in writing the letter of guarantee. The evidence does not prove any pre existing agreement and tends to prove that there ha been no mistake in writing the letter of guarantee even if there was an agreement. Therefore it seems to me that the High Court was in error in thinking that the alteration in this case had been made to carry out the intention of the parties. The principle underlying section 87 of the has no application to the facts of this case. Dr. Seiyid Muhammed, however, put the matter from another point of veiw. He said that in order that an alteration in an instrument made without a party 's knowledge might be avoided against him that alteration had to be material and in support of it he referred us to a passage in Halsbury 's Laws of England 3rd Ed., vol. 11, p. 380. He then said that no alteration could be material unless it was to the prejudice of a party. He pointed out that the alteration in the present case had reduced the limit of the appellant 's liability from Rs. 25,000/ to Rs. 20,000/ and it was not therefore a material alteration. Hence he contended that the letter of guarantee had not been avoided by the alteration. I do not think that this contention assists the Bank at all. I will assume that an alteration in an 73 instrument which is not to the prejudice of a party to it is not a material alteration and does not release him from his liability under the instrument. This rule however does not make the instrument as altered binding on that party. If it did, that would amount to changing by unilateral action the terms of a contract made by common consent or to changing the terms of an offer made by one without his consent. As I have earlier said, none of these things can be done under our law. I may add that I have not been able to find any authority laying down that in such a case the altered instrument would be binding. All that we would get in this case if Dr. Seiyid Muhammed is right, is that the alteration might be ignored and, the instrument in its original form might be considered as existing unaffected by the alteration. In the present case, therefore, we would have a letter of guarantee written by the appellant undertaking to repay the balance due by Sankaran on the overdraft account up to a limit of Rs. 25,000/ . What then ? The suit is not on a contract to guarantee up to Rs. 25,000/ . Indeed according to the Bank 's pleading and evidence there never was any agreement for such a guarantee between it and the appellant. The letter, therefore cannot be considered as evidence of such a contract. Further the evidence to which I have already referred proves that as an offer, the letter was not accepted by the Bank. In fact the letter in its original form is of no assistance to the Bank at all in this case, it neither proves a guarantee for Rs. 25,000/ nor for Rs. 20,000/ . But it is said that the letter contained an enforceable contract as it was supported by consideration which had already moved from the Bank, namely, the advance made to Sankaran before the date of the letter and the promise to make further advances. Then it is said that inadequacy of consideration does not avoid a contract as stated in Explanation 2 of section 25 of the Contract Act, 1872, and therefore the Bank 's undertaking 74 to advance upto Rs. 20,000/ could support the appellant 's promise to guarantee up to Rs. 25,000/ . But it is not the Bank 's case that there was such a contract of guarantee. Its case was that the contract of guarantee was for Rs. 20,000/ . That contract is not supported by the letter on which alone the suit is based. If there was no contract as stated in the letter then. no question of consideration to support it can possibly arise. Therefore, it seems to me that the. contention that the alteration was immaterial and did not affect the instrument so far as the appellant is concerned is to no purpose in the present case. The position may then be thus stated. We have, a suit against the appellant based on a written contract to guarantee repayment of Sankaran 's dues to the Bank up to Rs. 20,060/ . There is no evidence of, any verbal contract of guarantee. The appellant ' wrote a letter guaranteeing repayment of those dues up to Rs. 251000/ . Sankaran also signed this letter but that signature is of no consequence to the question of guarantee which alone arises in this appeal for Sankaran could not guarantee his own debit and his signature would therefore only be evidence of his liability for the amount advanced to him by way of overdraft. Such liability, however, he had already undertaken by executing a promissory note for Rs. 20,000/ in favour of the Bank. His signature on the letter of guarantee therefore made no difference in the legal relations that have to be considered in this appeal. Returning now to the letter of guarantee Written by the appellant, the Bank refused to accept that letter and, therefore, on the Bank 's own case no contract on its terms was ever made. That letter was altered without the consent of the appellant probably by Sankaran by substituting Rs. 20,000/ for Rs. 25,600/ . If the alteration was without the appellant 's consent, it could not have been authorised by him; if it had been, consent would be implied. There is further neither evidence, nor pleading nor 75 finding of any such authority. The altered document is not binding on tile appellant, for the alteration had not been made to carry out the intention of the: parties in the alteration is ignored, then the document creates no liability in the appellant, for the Bank refused to accept a guarantee on the terms Contained in the document before it was altered. Further, the contract sued upon is different from the contract which might, have been made by the document as it stood before the alteration. The unaltered document cannot establish the contract sued upon. The conclusion to which I arrive then is that the suit against the appellant as framed must fail. I would, therefore, allow the appeal with costs here and below and dismiss the suit against the appellant. HIDAYATULLAH,J. I have had the advantage of ' reading the judgment prepared by my brother Sarkar. In my opinion, and I say it with great respect, this appeal must fail. I shall give my reasons briefly. The facts of the case are simple. The suit, out of which this appeal arises, was filed by the Thomco 's Bank Ltd, Trivandrum, (to be called in this judgment the 'Bank ') against V. Sankaran (the principal Debtor) and N. section Anirudhan (the surety and appellant before us). The suit was based against V. Sankaran on a promissory note executed by him in favour of the Bank on February 24, 1947, (Exhibit B) and against the present appellant on a letter of guarantee dated May 24, 1947. In so far as Sankaran has not appealed against the decree passed against him we need not mention the facts leading up to the promissory note which was prior in time. Anirudhan in defending himself stated that the letter of guarantee was for Rs. 5,000 and that it had been altered without his knowledge and consent in a sum of Rs. 20,000/ . The letter of guarantee is Exhibit C and the original does show two corrections in the figures as well as the written words mentioning the amount. Figure "5" in the amount of Rs. 25,000/ in figures appears to have been 76 altered to "O"; and in the words "Rupees twenty five thousand" the word "five" has been struck out. The appellant 's case that 5,000 in figures was altered to 20,000/ by the addition of the figure "2" and the alteration of the figure "5" into "O" and the corresponding change in the words by the addition of the words "twenty" and the scoring out of word "five" has not been believed. Thus the case made out by Anirudhan has not been accepted. The correction. however, is patent and the question that has arisen in this case is whether by the alteration of the letter of guarantee the surety is discharged. The finding of the High Court is that there was no prior oral agreement between the Bank and Anirudhan. This letter, as is obvious from the dates, was give after the loan had already been made. The contention of the Bank was that when Sankaran brought this letter and asked for additional loan of Rs. 5,000 the Bank refused to advance any further amount and declined to accept this letter of guarantee for Rs. 25,000 lest the Bank might be compelled to loan a further sum of Rs. 5,000. Sankaran then took back the letter and after some time brought it back with the figure "5" changed into "O" and the word "five" scored out. These corrections were not initialled either by Sankaran or by Anirudhan. The Bank, however, accepted this letter and kept it and sued Anirudhan upon it. The question is whether Anirudhan 's liability is discharged by the alteration in the document which alteration is not proved to have been made either by him or with his knowledge or consent. It is conceded and indeed it is the law that only a material alteration makes a document void. It is also the law that if the custodian of the document makes or allows an alteration to be made while the document is in his custody he cannot sue upon it because it is his duty to preserve the document in the state in which he got it. In the present case, the 77 document was not altered by, Bank nor with the Bank 's consent or connivance while the document was in. its custody. The document was apparently altered either by Anirudhan or by Sankaran or by both. If it was altered by Anirudhan, or by him and Sankaran together, the document still remains the document of Anirudhan and the suit of the Bank based upon it is competent against him. If it was altered by Sankaran the question is whether the alteration was a material alteration to make it void against Anirudhan. The High Court is of the opinion that it was not material. I am inclined to accept the conclusion of the High Court. Anirudhan by the letter to the Bank wished to guarantee an overdraft of Sankaran not exceeding Rs. 25,000/ . His case that it was Rs. 5,000/ and not Rs. 25,000 has been disbelieved. The document was originally written for an amount of Rs. 25,000/ which was reduced to Rs. 20,000/ 1 will assume, by Sankaran and the letter of guarantee was accepted by the Bank. The question is whether by the reduction of the amount of the guarantee Anirudhan can say that the document executed by him has been materially altered and his liability is at an end. In my judgment, in the present case it cannot be said. The document still continues to represent what was intended by Anirudhan. That intention was to guarantee a loan up to Rs. 25,000/ which includes the sum for Rs. 20,000/ for which the guarantee now stands. The question is whether Anirudhan can say that this guarantee is at an end. There are really two defences open to Anirudhan the surety. The first is that he had offered to stand surety on certain terms and as those conditions have been altered he is discharged from any liability. The second also depends on the alteration and it is that a document executed by him has been materially altered and is therefore void. This is a plea of non est factum. Both the arguments rest upon the alteration of the contract into which Anirudhan wished to enter. A surety is considered a "favoured debtor" and his 78 liability is strictissimi juris. Lord Westbury, L.C., in Blest vs Brown (1) stated this liability in the following words: "It must always be recollected in what manner a surety is bound. You bind him to the letter of his engagement. Beyond the proper inter pretation of that engagement you have no hold upon him. He receives no benefit and no consideration. He is bound, therefore, merely according to the proper meaning and effect of the written engagement that he has entered into. If that written engagement is altered in a single line, no matter whether the alteration be innocently made, he has a right to say, " 'The contract is no longer that for which I engaged to be surety; you have put an end to the contract that I guaranteed, and my obligation, therefore, is at ail end. " It is not necessary to go into the fact of that case where the surety guaranteed fulfilment of a contract for the supply of, flour to a banker who in his turn had undertaken to supply bread to Government. The case turned upon stipulations by the Government and their breach and the decision cannot be regarded a ,direct authority, apart from the general observation, in the present case. The statement of the law in Blest vs Brown (1) Was considered by the Court of Appeal in Holme vs Brunskill (2) in an appeal from a judgment of Denman, J. (later Lord Denman). Cotton, L.J., stated the law in these words: "The true rule in my opinion is, that if there is any agreement between the principals with reference to the contract guaranteed, the surety ought to be consulted, and that, if he has not consented to the alteration, although in cases where it is without inquiry evident that the alteration is unsubstantial, or that it cannot be otherwise than beneficial to the surety, the surety may not be discharged; ), Yet, that if it is not self evident that (1) ; (1862) 4 De G. F. & J. 365 ; (2) 79 the alteration is unsubstantial, or one which cannot be prejudicial to the surety, the Court will not, in an action against the suerty, go into an inquiry as to the effect of the alteration. . " To this statement of the law, must be added the 'dissent of Brett, L.J., who stated that the surety in that case was not raleased observing that the doctrine of release of sureties was carried far enough and that lie would not carry it any further. There is noticeable a difference between the strict rule stated by Lord Westbury and that stated by Cotton L. J., and the law now accepts that unsubstantial alteration which are to the benefit of the surety do not discharge the surety from the liability. Of course, if the alteration is to the disadvantage of the surety, or its unsubstantial character is not self evident the surety can claim to be discharged. The Court will not then inquire whether it in fact harmed the surety. That dictum of Cotton L. J., was quoted with approval by the Judicial Committee in ward vs The National Bank of Neu Zealand. Limited (1). Other cases in which a similar liberal view is taken are mentioned in these two decisions. Before I examine the position of Anirudhan with regard to the law applicable to sureties, I wish to refer to the law relating to the alteration of documents. These two matters really go together in this case. Here, again, the strict rule at one time was that the slightest alteration makes the document void. The leading case for a long time was Pigot 's case (2) where Lord Coke stated the doctrine as follows: "These points were resolved: 1. When a lawful deed is raised, whereby it becomes void, the obligor may plead non, est factum, and give the matter in evidence, because at the time of the plea pleaded, it is not his deed." "Secondly, it was resolved, that when any deed is altered in a point material, by the plaintiff himself, or by any stranger, without the privity (1) , (2) 11 Co.Rep.26 b;77E.R.177. 80 of the obligee, be it by interlineation, addition, raising, or by drawing of a pen through a line, or through the midst of any material word, that the deed thereby becomes void . so if the obligee himself alters the deed by any of the said ways, although it is in words not material, yet the deed ,is void: but if a stranger, without his privity, alters the deed by any of the said ways in any point material, it shall not avoid the deed. " The passage is also to be found in an article "Discharge of Contracts by Alteration" by Williston in 18 Harvard Law Review, p. 105. The strictness of this rule was tempered in subsequent cases and was departed from in Aldous vs Cornwell (1) where Lush, J. (speaking for Cockburn, C. J., Blackburn, J., and himself), after referring to numerous authorities,observed "This being the state of the authorities, we think we are not bound by the doctrine of Pigot 's case or the authority cited for it; and not being bound. We are certainly not disposed to lay it down as a rule of law that the addition of words which cannot possible prejudice any one, destroys the validity of the note. It seems to us repugnant to justice and common sense to hold that the maker of a promissory note is discharged from his obligation to pay it because the holder has put in writing on the note what the law would have supplied if the words had not been written. " What is said here about an addition or alteration of a promissory note was prior to the enactment of the rule in Bills of Exchange Act in England which has altered the law with regard to negotiable instruments but the observations apply forcefully to a document of the type we have where there were. two executants (one being the debtor and the other his surety and the debtor has not increased but reduced the amount of his own liability as well as that of his (1) 81 surety. That immaterial alterations do not matter is borne out by the observation of Swinfen Eady, J., in Bishop of Creditor vs Bishop of Exeter (1) where Pigot 's case(2) and the earlier statement of the law in Sheppard 's Touchstone, 7th ed. (Preston 's), p. 55. , were not accepted. During the course of the argument Swinfen Eady, J., referred to cases in which corrections in the testimonium of documents to accord them with existing facts were held not to be material alterations. The question before me is whether a document jointly executed by two persons creating a liability equal for both is to be regarded as materially altered if the liability is reduced equally for both but the alteration is made only by one of them. In my opinion, such an alteration must be regarded as unsubstantial and not otherwise than beneficial to the surety and it cannot attract the strict rule stated by Lord Coke or that stated by Lord Westbury in the cited cases. me give an example: If A places an order with a trader for supply on credit of ten bags of wheat and B endorsed the order by writing, "I guarantee payment up to ten bags", can it be said that 'the guarantee by B is dissolved when A takes the note and finding that the tradesman has only six bags of wheat in stock, corrects his order as well as the endorsement by altering "ten ' into 'six '? In my opinion, to such a correction neither the one rule nor the other can apply. The strict rule of law which was brought to our notice from the well known Suffell 's Case(3), where a Bank of England note was mutilated and its number destroyed, depended upon its special facts. The number of the Bank of England note was considered its vital part and the alteration a material alteration. Suffell 's Cage(3) was not followed by the Privy Council in a case where a bank note issued by bank which was only a contract and not currency, as in the other case, was destroyed because the owner had forgotten that the note was in the pocket of a garment and the garment had been washed. The (1) (2) ; ; (3) 82 note was reconstructed and showed the contract but not the number. The Privy Council held the bank liable even though the contract had been Altered by eraser (see Hong Kong and Shanghai Banking Corporation vs Lo Lee Khi(1). These cases establish that both the limbs of the argument which Anirudhan can raise are not vali in the circumstances of this case. In my judgment, the particular document in this, case cannot be said to have been materially altered, because. it has not been altered in such a manner as to change its nature. The alteration does not save the surety from liability arising under it. The alteration was made by a co executant who reduced not only his own liability but that of the surety also. indeed, the surety himself under stood the law to be this because he set up the case that the document originally guaranteed an overdraft of Rs. 5,000/ but was altered to guarantee an overdraft of Rs. 20,000/ . This case has been proved false and he never set up the case that the document was void because the amount was reduced from Rs. 25,000/ to Rs. 20,000/ . It does not lie in the mouth of Anirudhan. to say the he meant. to guarantee 25,000/ but. not Rs. 20,000/ because he never went to the Bank and made this a condition of the agreement. Now he cannot say that the document has; become void against him or that the contract which had emerged by the Bank 's acceptance of the document as altered does not bind him. There is no need, in my opinion, to consider whether there was a prior oral agreement or not. I agree there is no proof of such an agreement. The letter of Anirudhan to the Bank was based on a consideration which had already moved to Sankaran and which Anirudhan wished to guarantee. Even if treated as an offer by Anirudhan to the Bank, the Batik accepted the amended offer and Sankaran must be deemed to have had the authority to reduce the amount, (1) ; 83 though not to increase it. The document was altered while in the possession of the very person who, as the agent of Anirudhan, brought it to the Bank on both the occasions. Anirudhan must be deemed to have held out Sarikaran as his agent for this purpose and this creates an estoppel against Anirudhan, because the Bank believed that Sankaran had the authority. The offer thus remains in its amended form an offer of Anirudhan to the Bank and the Bank by accepting it turned it into a contract of guarantee which was backed by the past consideration on which the offer of Anirudhan was originally based. In my opinion, the appeal must fail. I would, therefore, dismiss it. By COURT : In accordance with the opinion of the majority, the appeal is dismissed. There would be no order as to costs. Appeal dismissed.

The appellant agreed to stand surety for an overdraft allowed by the respondent Bank to section A blank form of guarantee was given by the Bank to S, who then had it filled up by the appellant stating the maximum amount which he guaranteed as Rs. 25000/ . When S brought the letter of guarantee duly signed by the appellant and himself to the Bank the latter refused to accept the guarantee up to that limit as it was not prepared to give S accommodation for a larger sum than Rs. 20000/ and wanted it to be limited to Rs. 20000/ . S then made alterations in the letter with the amount of the maximum limit corrected to Rs. 20000/ and gave it to the Bank. In a suit instituted by the Bank against the principal debtor, S, and the appellant on the basis of the contract of guarantee for Rs. 20000/ , the appellant pleaded that as the document was altered without his knowledge or consent, he was discharged from his liability. Held, (per Kapur and Hidayatullah, JJ., Sarkar, J., dissenting), that the appellant was not discharged from his liability under the contract of guarantee. 64 per Kapur, J. S was acting for and on behalf of the appellant since it was at his instance that the appellant was standing surety and the appellant handed over the deed of guarantee to S for the purpose of being given to the Bank. The plea of avoidance of contract by material alteration was of no avail to the appellant because the document was not altered while in possession of the promisee but was altered by S who was at the time acting as the agent of the appellant. per Sarkar, J. The suit against the appellant as framed must fail. The altered document was not binding on the appellant, for the alteration had not been made to carry out the intention of the parties. If the alteration, is ignored as immaterial, then the document creates no liability in the appellant, for the Bank refused to accept a guarantee on the terms contained in it before it was altered and therefore there was no contract made between the parties by the document. Further, the contract sued upon is different from the contract which might have been made by acceptance of the document as it stood before the alteration. The unaltered document cannot establish the contract sued on. per Hidayatullah, J. The document in this case could not be said to have been materially altered because it was not al tered in such a manner as to change its nature. The alteration was made by a co executant who reduced not only his own liability but that of the surety also. The document was altered while in the possession of S, the very person who, as the agent of the surety, brought it to the Bank. The surety must be deemed to have held out S as his agent for this purpose and this created an estoppel against the surety because the Bank believed that S had the authority. Accordingly, the alteration of the document did not save the surety from liability under it.

iminal Appeal No. 58 of 1961. 231 Appeal by special leave from the judgment and order dated October 17, 1960, of the Bombay s High Court in Criminal Appeal No. 1235 of 1960. R. H. Dhebar, for the appellant. The respondent did not appear. February 16. The Judgment of the Court was delivered by Kapur J. This appeal by Special Leave against the decision of the High Court of Bombay dismissing the State 's appeal against the acquittal of the respondent arises out of proceedings under section 66(1)(b) of the Bombay Prohibition Act, 1949 (Act25 of 1949), as amended, hereinafter called the Act '. The respondent was arrested by Police Constable Laxman Sabaji on August 8, 1959, at 8 15 p.m. on the ground that he was smelling of liquor and bad therefore contravened the provisions of the Act. The respondent was taken to the hospital where he was examined by Dr. Dadlani Prabhu Rochiram P. W., who has deposed that the respondent was Smelling of liquor but his speech, behaviour, gait, coordination and memory were normal. From this he concluded that the respondent had consumed some alcoholic substance but was not under the influence of liquor. In cross examination he stated that Tincture Neem would produce blood concentration of 0.146% M/V of ethyl alcohol. The respondent in his examination under section 342 stated: Question: "What do you wish to say with reference to the evidence given and recorded against you? Answer :I have not consumed prohibited alcohol. I had taken 6 ounces of Neem as I am used to it". 232 On this evidence the Presidency Magistrate Mr. Lokur acquitted the respondent. He observed: "Neem is a medicinal preparation containing about 40% of alcohol and is readily available in the market. I do not see why I should not accept the explanation given by the accused that he had taken Neem in order to satiate his craving for alcohol. It has been held by Bavdekar and Chainani, JJ., in Criminal Appeal No. 1611 of 1954 dated 25 2 1954 that taking an excess dose of medicinal preparation does not amount to consumption of prohibited liquor. In Criminal Appeal No. 1562 of 1959 State vs Domnic Robert D 'Sliva where a similar defence was taken up it was held that consumption of 6 ounces of essence of Neem did not constitute an offence. Following these judgments I hold that the accused has not committed any offence. I therefore acquit the accused". Against this order an appeal was taken to the High Court and one of the grounds taken in the memorandum of Appeal was that the mere statement of the respondent that he had consumed 8 ounces of Tincture of Neem was not sufficient to rebut the presumption arising out of sub section (2) of section 66 of the Act. But the High Court dismissed the appeal in limine. It is against that order that the State has come by Special Leave to this Court. The main question raised on behalf of the State is that by the introduction of section 66(2) in the Act as a result of the Bombay Prohibition (Extension and amendment) Act, 1959, (Act 12 of 1959), the onus is on the accused person and that that onus had not been discharged in the present case. Section 66(2) is as follows : section 66(2) ",Subject to the provisions of subsection 233 (3) wherein in any trial of an offence under clause (b) of sub section(1) for the consump tion of an intoxicant it is alleged that the accused person consumed liquor, and it is proved that the concentration of alcohol in the blood of the accused person is not less than 0.05 per cent. weight in volume, then the burden of proving that the liquor consumed was a medicinal or toilet preparation, or an antiseptic preparation or solution, or a flavouring extract, essence or syrup, containing alcohol, the consumption of which is not in contravention of the Act or any rules, regulation or orders made thereunder, shall be upon the accused person,and the Court shall in the absence of such proof presume the contrary". The argument was put in this way that if the prosecution proves that the concentration of alcohol in the blood of an accused person is more than 0.05% then under section 66(2) of the Act the burden was on him to show that the liquor which he had consumed was a medicinal or toilet preparation the consumption of which is not in contravention of the Act or any Rules made thereunder. It was further submitted that in order to discharge the onus mere statement of the accused is not sufficient. Our attention was drawn to the scheme and some of the provisions of the Act. The prosecution, in the present case, has proved that the respondent 's breath was smelling of liquor and that on examination of his blood it was found to contain 0.146% bat the respondent gave an explanation showing that he had taken 6 ounces of Tincture of Neem and Dr. Dadlani Prabhu Rochiram has deposed that the consumption of 6 to 8 ounces of that substance will produce that amount of concentration of blood. This was 234 accepted by the learned Presidency Magistrate and by the High Court. Therefore on this finding it must be held that the explanation given by the respondent of the cause of his smelling of liquor and of the blood concentration was accepted by the High Court as being sufficient to discharge the onus placed on him. But Mr. Dhebar for the State submits that mere statement of an accused person is not sufficient for the discharge of such onus and relies on a judgment of this Court in C. S.D. swamy vs The State (1), where Sinha, J. (as he then was), observed: "In this case, no acceptable evidence, beyond the bare statements of the accused, has been adduced to show that the contrary of what has been proved by the prosecution, has been established, because the requirement of the section is that the accused person shall be presumed to be guilty of criminal misconduct in the discharge of his official duties " unless the contrary is proved". The words of the statute are peremptory, and the burden must lie all the time on the accused to prove the contrary". All that the learned Judge there meant to Ray was that the evidence of the statement of the accused in the circumstances of that case was not sufficient to discharge the onus but that does not mean that in no case can the statement of an accused person be taken to be sufficient for the purpose of discharging the onus if a statute places the onus on him. Under section 342 of the Criminal Procedure Code the Court has the power to examine the accused so as to en able him to explain any circumstance appearing in evidence against him. Under sub section 3) of that section the answers given by an accused person may be taken into consideration in such enquiry or trial. The object of examination under section 342 therefore is to give the, accused an opportunity to (1) ; , 471. 235 explain the case made against him and that statement can be taken into consideration in judging the innocence or guilt of the person so accused. Therefore if the courts below have accepted this explanation it must be held that the respondent has discharged the onus which was placed on him by section 65(2) of the Act. The appeal is therefore dismissed. Appeal dismissed.

Respondent was arrested by a police constable on the ground that he was smelling of liquor. The doctor who examined him gave evidence at the trial that though the respondent had consumed alcoholic substance he was not under the influence of liquor. In cross examination the doctor stated that consumption of Neem would produce a blood concentration of 0. 146%. The respondent in examination under section 342 of the Code of Criminal Procedure stated that he had not consumed prohibited alcohol but that he had consumed six ounces of Neem. He was acquitted by the Magistrate. The appellant appealed to the High Court. The main ground of appeal was that the mere statement of the respondent that he had consumed 6 ozs. of Neem was not sufficient to rebut the presumption under sub section (2) of section 66 of the Bombay prohibition Act, 1949, as amended by the Bombay Prohibition (Extension and amendment) Act, 1959. The High Court dismissed the appeal in limine. Thereupon the appellant appealed to the Supreme Court by way of Special Leave on the same ground as was raised before the High Court. Held, that the statement of the accused recorded under section 342 of the Code of Criminal Procedure can be taken into consideration in judging the innocence or guilt of a person. If the explanation given by the accused in his statement is acceptable to the court it must be held that the accused has discharged the burden under section 66 (2) of the Bombay Prohibi tion Act. O. section D. Swamy vs State, 1, distinguished.

Appeals Nos. 149 and 150 of 1961. Appeals from the judgment and order dated September 23, 1968, of the Bombay High Court in I.T.R. No. 86 of the 1957. R.J. Kolah, J. B. Dadachanji, O. C. Mathur and Ravinder Narain, for the appellants. K.N. Rajagopala Sastri and D. Gupta, for the respondent. 312 1962, February 19. S.K. DAS, J. These are two appeals on a certificate of fitness granted by the High Court of Judicature at Bombay under,%. 66A(2) of the Indian Income tax Act, 1922. The relevant facts which have given rise to them are shortly stated below. The Indore Malwa United Mills, a limited liability company, is the appellant before us and will be referred to in this judgment as the assessee company. The respondent is the Commissioner of Income tax(Central), Bombay. The assessee company carried on a business of manufacture and sale of textile goods. The manufacture was made at its mills in Indore which was Indian State before integration and had its own law as to income tax known as the Indore Industrial Tax Rules, 1927. The sales of textile goods were made at various places, some inside and some outside the taxable territories of British India. For and upto the assessment year 1949 50 the assessee company was treated as a non resident within the meaning of s.4A of the Indian Income tax Act, 1922. For the assessment years 19 50 51, and 1951 52 which are two assessment years under consideration, the account years were the calendar years 1946 and 1950 respec tively. Indore became a part of the taxable territories within the meaning of the Indian Income. tax Act is the two assessment years and the assessee company was held to be "resident and ordinarily resident" with the meaning of that Act. Upto the assessment year 1949 50 that part of its profits which was received in British India was subjected to tax together with its other income which accrued in British India, namely, interest on securities and interest on bank accounts. In the assessments made for the assessment years 1948 49 and 1919 50 the 313 position of the assessee company was stated to be as follows: 1948 49 Income tinder the head 'Interest on securities ' . Rs. 1,032 Income under the head 'Other sources ' interest from banks . Rs. 231 Rs 1,263 Business loss Rs. 1,992/ . Balance of lossRs. 729/ carried forward. 1949 50 Interest on securities . Rs. 1,023 Bank interest . Rs. 2 13 Rs.1,236 Less : loss of 1948 49 set off . Rs. 729 Total income . Rs. 507 In making the calculation of business profits or loss received or arising in the taxable territories, a proportion was struck between the total turn over of the assessee company and its sales the proceeds whereof were received in the taxable territories. The following table, which is part of the order of assessment of 1950 51, shows clearly how the calculation was made. 314 1 2 3 4 5 Rs. Rs. Rs. Rs. Net profit Deprecia Busi Total of the as per ness turnover Assess company the Indian income of the ment befor al Income of the company year lowance Tax Act com of depre pany ciation (Col.2 minus col.3) 6 7 8 9 Rs. Rs. Rs. Rs. Sales for Business profit other Total in which considered as income come for proceeds having been accruing the prupose were received in the in the of assess received taxable terri taxable ment under in the tories(by appor terri the Indian taxable tioning the tories Icome Tax territories amount in Act.(Col.8) col. 4 in the proportion of col 5: col.6) 315 Daring the course of the assessment proceedings for 1950 51 the assessee company claimed that it was entitled to a set off of the entire losses of the assessment year 1948 49 which it was common ground before the Tribunal, came to Rs. 5,19,590/ , and not merely the proportionate loss. The assessee company also claimed that the depreciation allowances of the two years 1948 49 and 1949 50 to which effect could not be given in those years and which had, therefore, to be carried forward should be added to the depreciation allowance of 1950 51 and be set off against the profits and gains of the assessee company liable to assessment in the assessment years in question. It is to be noted that the assessment of the assessee company for the assessment years 1948 49 and 1949 50 was made both under the Indian Income tax Act and under the Indore Industrial Tax Rules, 1927. Now the assessee company made two claims in the course of the assessment proceedings for 1950 51. One was with regard to the loss of Rs. 5,19,590/ and the assessee company 's contention was that it was entitled to set off this loss against the profits made in its business in that year and it also contended that it was entitled to carry forward the unabsorbed depreciation into that year. The first contention of the assessee company was rejected by the Tribunal but the second was allowed. Two questions were then raised, one at the instance of the assessee company and the other at the instance of the Commissioner, dealing with the aforesaid two claims of the asseessee company. These two questions were : " 1. Whether the loss of Rs. 5,19,590/ of the year 1948 49 is liable to be set off against the assessee 's business income for the assess ment years 1950 51 and 1951 52 ? 2. Whether the unabsorbed depreciation of the years 1948 49 and 1949 50 is liable to 316 be set off against the income of the assessee for the eassessment years 1950 51 and 1951 52. " On being satisfied that aforesaid two questions arose out of its order, the income tax Appellate Tribunal, Bombay Bench A, referred them to the High Court of Bombay under s, 66(1) of the Indian Income tax Act. The High Court answered the first question against the assessee company and the second question in its favour by its judgment and order dated September 23, '1958. The assessee company then moved the High Court for a certificate under section 66A(2) of the Indian Income tax Act with regard to the answer given by the High Court to the first question and having obtained a certificate of fitness has preferred the two appeals to this Court. We are concerned in these two appeals with the correctness or otherwise of the answer given by the High Court to the first question; the second question does not fall for our consideration. On behalf of the assessee company section 24(2) of the Indian Income tax Act has been relied on in support of the claim that the assessee company is entitled to carry forward and set off the entire loss of Rs. 5,19,590/ incurred in the year 1948 49 against the assessee company 's business income for the assessment years 1950 51 and 1951 52. Mr. Kolah appearing on behalf of the assessee company has put his argument in the following way. First of all, he has submitted that the Income tax Officer wrongly proceeded on the footing as though the assessee company was carrying on two separate businesses, one within the taxable territories and the other outside them. Mr. Kolah has contended that the business was one business within the meaning of section 10 of the Indian Income tax Act and in the two assessment years in question Indore having become a part of the taxable terri tories provisions in sub section (2) of section 24 came into operation; therefore, the losses which the assessee 317 company sustained in 1948 49, being a previous year not earlier than the previous year mentioned in the sub section and the losses not having been set off under sub s.(1) of section 24, the assessee company was entitled to carry forward the losses and set them off against the profits and gains of the assessee company from the same business under any other head, as the time limit of six years had not expired. As against this argument, the contention on behalf Of the respondent has been that s 24 has no application in the facts of the present case inasmuch as in the year 1948 49 in which year the losses had occurred, the assessee company was treated as a nonresident. On behalf of the respondent it has been submitted that the provisions of section 24 are applicable only to profits and agains which are assessable under the Indian Income tax Act and in the case of non residents who were assessees in British India or in the taxable territories. The claim to set off is only allowable in respect of loss of profits or gains incurred by the nonresidents under any of the heads mentioned in section 6, and section 24 is applicable only to such loss of profits arid gains which if they had been profits and gains would have been assessable in British India or the taxable territories. It is contended that in the case of nonresidents, income accruing or arising without British India or without taxable territories is not liable to be assessed and the loss of such profits and gains is not contemplated to be set off within the provisions of sub sections (1) and (2) of section 24 of the Indian Incometax Act,. Before we consider these contentions it is necessary to set out the material provisions of the Indian Income tax Act as they stood at the relevant time. (1) Subject to the provisions of this Act, the total income of any previous year of any person includes all income, profits and gains from whatever source derived 318 which (a) are received or deemed to be received in British India in such year by or on behalf of such person, or (b) x x x x (e) if such person is not resident in British India during such year, accrue or arise or are deemed to accrue or arise to him in British India during such year: x x x 14, (1) x xx (2) The tax shall not be payable by an assessee (a) x x x (b) x x x (c) in respect of any income, profits or gains accruing or arising to him within an Indian State, unless such income, profits or gains are received or deemed to be received in or are brought into British India in the pre vious year by or on behalf of the assessee, or are assessable under section 12B or section 42. (1) Where any assessee sustains 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 : Provided that, where the lose sustained is a loss of profits or gains which would but for the loss have accrued or arisen within an Indian State and would, under the provisions of clause (c) of subsection (2) of section 14, have been exempted from tax, such loss shall not be set off except against profits or gains accruing or arising within an Indian 319 State and exempt from tax under the said provisions. x x x (2) Where any assessee sustains a loss of profit or gains in any year, being a previous year not earlier than the previous year for the assessment for the year ending on the 31st day of March, 1940, under the head "Profits and gains of business, profession or vocation", and the lose cannot be wholly set off under sub section (1) the portion not so set off shall be carried forward to the following year and set off against the profits and gains, if any, of the assessee from the same business, profession or vocation for that year; and if it cannot be wholly so set off, the amount of loss not so set off shall be carried forward to the follow ing year, and so on; but no loss shall be so carried forward for more than six years: Provided that (a) Where the loss sustained is a loss of profits and gains of a business, profession or vocation to which the first proviso to sub section (1) is applicable and the profits and gains of that business, profession or vocation are, under the provisions of clause (c) of sub section (2) of section 14, exempt from tax, such loss shall not be set off except against profits and gains accruing or arising in an Indian State from the same business, profession or vocation and exempt from tax under the said provisions; (b) Where depreciation allowance is, under clause (b) of proviso to clause (vi) of sub section of section 10, also to be carried forward, effect shall be given to the provisions of this sub section; x x x It may perhaps be stated here that Mr. Kolah has placed no reliance on the provisions of the Taxation Laws (Part B States) (Removal of 320 Difficulties) Order, 1950. Clause 3 of the said Order provides that losses suffered in Indian States can be carried forward and set off only if under the State law they could be so carried forward or set off. Admittedly, Under the Indore Industrial Tax Rules, 1927 there was no provision for the carrying forward of losses; therefore, cl. 3 of the Taxation Laws (Part B States)(Removal of Difficulties) Order, 1950 was of no assistance to the assessee company. This view of the High Court has not been contested before us and we need, therefore, make no further reference to this aspect of the case. The answer to the question which we have to consider depends on the true scope and effect of section 24 of the Indian Income tax Act. Under the Indian Income tax Act, 1922, assessees are divided into three categories (a) resident and ordinarily resident, (b) resident but not ordinarily resident, and (c) not resident. We are concerned in the present ' case with, an assessee who in the year in which the loss which is sought to be carried forward occurred, was a nonresident. Sub section (1) of s.4, the material portion of which we have quoted earlier, states that person Who are not resident in India ire liable to charge under cl. (a) or cl.(c) of the said subsection. They may be taxed under cl. (a) on income received or deemed to be received in India even if it accrues elsewhere, or under on income which accrues or arises or is deemed to corue or arise in India even if it is received elsehere. The liability to tax in respect of income received in India is common to both residents and non residents and is imposed by the general clause (a). A non resident, unlike a resident, is not argeable in respect of income accruing or arising without India and not received in India. Section 4(2) (c), which is now deleted, had great importance when British India was distinct from Indian states, because it exempted income which accrued 321 or was received in the Indian States but was not brought into British India. The deletion of this clause became inevitable upon,the merger of the Indian States. This clause which wan inserted in 1941 exempted income accruing or arising within the Indian States; but the exemption did not apply if the income was received or deemed to be received in or was brought into the taxable territories in the previous year by or on behalf of the assessee or if the income was assessable under section 128 or section 42. The Position, therefore, was that losses made in British India could not be reduced by adjusting against them the profits in the Indian States which were exempted under the clause, but the income exempted from the clause had,, however, to be included in the assessee 's total income for the purpose of determining the rate applicable to his taxable income. But so far as a non resident was concerned the clause had no application, because a nonresident was not chargeable in respect of ' income accruing or arising without India and not received in India. Now, we come to section 24, sub ss.(1) and (2) with the provisos appended thereto which we have quoted earlier in this judgment. It appears that prior to 1950 profits accruing in the Indian States, later called Part B States, were exempt from tax under section 14(2)(c), unless they were, received in or brought into the territories then referred to as British India or were assessable under section 128 or section 42. The first proviso to sub s.(1) as it stood at the relevant time dealt with losses accruing in the qaondam Indian States and provided that losses incurred in the Indian States should be set off only against profits accruing in the Indian States. This was a reasonable provision, because an assessee who was not liable to tax in respect of his profits arising in the Indian States could not be allowed to set off his losses incurred in the Indian States against his profits arising in British India. that losses incurred in an Indian State could be Similarly cl.(a) of the provision to sub s.(2) enacted that losses incurred in an Indian State could be 322 carried forward and set off only against profits accruing in an Indian State from the same business in a Subsequent year. The argument on behalf of the respondent is that so far as a non resident is concerned, he is not chargeable in respect of income accruing or arising without India and not received in India. Therefore, in his case it is unnecessary to go to the provisos, but section 24 itself has no application because sub section (1) of section 24 when it refers to loss of profits or gains, has reference to taxable profits or taxable gains and sub s.(2) of section 24 can only be applied in a case where the loss cannot be set off under sub s.(1) because of the absence or inadequacy of profits etc. In other words, the argument is that section 24 is applicable only to such loss of profits and gains which if they had been profits and gains would have been assessable in British India or the taxable territories; but in the case of nonresidents, income accruing or arising without British India or without the taxable territories not being liable to be assessed, the loss of such profits and gains is not contemplated to be set off within the provisions of section .24, sub sections (1) and (2). Mr. Kolah has pointed out that sub s.(2) of section 24 as also sub s.(1) talk of "any assessee" and he has argued that there is no reason why the provisions of sub s.(2) of section 24 should not the applicable to a non resident assessee. He has further argued that whatever might have been the effect of the provisos in 1948 49, in 1950 51 Indore became part of the taxable territories and the assessee company became entitled to carry forward the losses up to six years and there is nothing in section 24(2) to prevent ' him from making the claim. We are unable to accept this argument as correct. Reading the provisions in section 24 with the provisions in s.4(1)(a) and section 1.4(2)(c) it seems clear to us that section (24)(1) when it talks of profits or gains has reference to 323 taxable profits or taxable gains in other words, it has reference to such profits and gains as would have been assessable in British India or the taxable territories. It has no reference to income accruing or arising without British India or without the taxable territories which were not liable to be assessed in the case of non residents. We are further of the view that for determining the nature of the losses under consideration in the present appeals, the relevant year was 1948 49, the year in which the losses occurred and the High Court rightly took the view that for the application of sub section (2) of section 24, the losses must be such losses as could have been set off under sub s.(1) of section 24. We agree with the view expressed by the High Court that the loss &mounting to Rs. 5,19,590/ was not such a loss as could have been set off either under sub section (1) or sub section (2) of section 24. We have, therefore, come to the conclusion that the High Court correctly answered the question which was referred to it. Accordingly, the appeals fail and are dismissed with costs, one hearing fee. Appeals dismissed.

The assessee company carried on a business of manufacture and sale of textile goods. The manufacture was made at its mills in Indore which was an Indian State before integra tion and had its own law as to income tax known as the Indore Industrial Tax Rules, 1927. The sales of textile goods so manufactured were made at various places, some inside and some outside the taxable territories of the then British India. For and upto assessment year 1949 50 the assessee company was treated as a non resident. Indore became a part of the taxable territories within the meaning of the Indian 311 Income tax Act, 1922 in the two assessment years 1950 51 and 1951 52 and the asscssee company was held to be "resident and ordinarily resident" within the meaning of that Act. Upto the assessment year 1949 50 that part of its profits which was received by the assessee company in British India was subjected to tax together with it. ,; other income which accrued in British India. In making the calculation of business profits or loss received or arising in the taxable territories, a proportion was struck between the total turnover and its sales the proceeds whereof were received in the taxable territories. The assessee company raised two questions in the course of the assessment proceedings, one of which with regard to the entire loss of Rs. 5,19,590/ of the year 1948 49 which it claimed to set off against the profits made in its business in the two assessment years. The assessee company contended that the business was one and under section 24 it was entitled to set off the losses which it had sustained in 1948 49. The High Court decided this question against the assessee company, but gave a certificate under section 66A of the Act. Held, on appeal, that the High Court correctly answered the questions the provisions of section 24 of the Act read with the provisions in section 4(1) (a) and (c) and section 14(2)(c) make it clear that sub s(1) of s: 24 when it talks of profits or gains has reference to taxable profits or taxable gains ; it has no reference to income accruing or arising without the taxable territories which were not liable to be assessed in the case of non residents. In determining the nature of the losses under consideration in these appeals the relevant year was 1948 49, the year in which the losses occurred, and the High Court rightly took the view that for the application of sub s (2) of section 24, the losses must be such losses as could have been set off under sub s.(1) of section 24.

section 82 of 1960 and 148, 168 to 174 and 357 to 361 of 1961. Petition under article 32 of the Constitution of India for the enforcement of Fundamental Rights. WITH Civil Appeals Nos. 453 to 474 of 1961. Appeals from the,, judgment and order dated May 25. 1959, of the Punjab High Court in Civil Writ Nos. 428, 303, 398, 402, 459 to 462, 421, 472, 473, 475, 490, 503, 509, 519, 520, 555, 590, 710 and 712 of 1958. AND Civil Appeal No. 50 of 1962. Appeal by special leave from the judgment and order date(] May 25, 1959, of the Punjab High Court in Civil Writ No. 347 of 1958. Achhru Ram and Naunit Lal,for the petitioner (in Potn. No. 82 of 60) and the appellant (in C. A. No. 50 of 62). 348 I. N. Shroff, for the petitioners (in Petn. No. 148 of 61) and the appellants (in C. As. 457 to 474. of 61). Hardev Singh and Y. Kumar, for the petitioers (in Petns. 168 to 174 and 357 to 361 of 61). C. K. Daphtary, Solicitor General of India, K. L. Gosain, B. R. L. Iyengar, Lakshmi Chand and I. N. Shroff, for the appellants (in C.As. Nos 453 and 456 of 1961). K. L. Gosain, B. R. L. Iyengar, Lakshmi Chand and I. N. Shroff, for the appellants I in C. A. No. 454 of 196 I). B. R. L. Iyengar, Lakshmi, Chand and I.N.Shroff, for the appellants (in C. A. No. 455 of 1961). S.M. Sikri, Advocate General, for the State of Punjab N. section Bindra and P. D. Menon, for the respondents (in all petitions and Civil Appeals). M. C. Setalvad, Attorney General of India, J. B. Dadachanji, O. C. Mathur and Ravinder Narain, for Intervener No.1 (Satinder Singh). K. L. Mehta, for Intervener No. 2 (Raghuvinder Singh and others). February 20. The Judgment of the Court was delivered by VENKATARAMA AIYAR, J. The question that rises for our decision in the above writ petitions and appeals is whether certain jagirs in the State of Punjab known as the "Cis Sutlej" jagir are liable to be resumed under the provisions of the Punjab Resumption of Jagirs Act, 1957 (Punjab Act No. 39 of 1957), hereinafter referred to as "the Act". This Act came into force on November 14, 1957, and the respondent State then proceeded to take action thereunder for resuming the jagirs. A number of petitions were thereupon filed in the 349 High Court of Punjab under article 226 of the Constitution challenging the validity of the Act and of the proceedings taken by the respondent State thereunder on the ground, firstly, that the Act was ultra vires the powers of the State Legislature and that its provisions were unconstitutional and void ; and, secondly, that even if the Act was intra vires the jagirs held by the petitioners were not "jagirs" as defined in the Act, and were therefore not liable to be resumed under its provisons. By their judgment dated May 25, 1959, the learned Judges held that the legislation was within the competence of the State, and that it did not contravence any of the constitutional provisions. They further held that the jagirs held by the petitioners fell within the definition of "jagir" under the Act, and were liable to be resumed thereunder, and that accordingly no writ could be issued against the State for proceeding under the provisions of the Act. By their Order dated January 27, 1960, the learned Judges granted leave to appeal to this Court under article 133 (1) (a), and pursuant to the same, Civil Appeals Nos. 453 to 474 of 1961 have been preferred to this Court. Appeal No. 50 of 1962 by special leave is also directed against the judgment of the Punjab High Court in a Writ Petition tinder article 226. Some of the jagirdars have also filed petitions in this Court under article 32) of the Constitution, impugning the Act and the action of the State thereunder on the same grounds as those raised in the appeals. We have accordingly heard arguments of learned Counsel both in the writ petitions and in the appeals, and this Judgment will govern all of them. Though a number of grounds have been taken in the pleadings, impugning the Act as ultra vires and its provisions as unconstitutional, in the argument before us, the only contention that was pressed was that the Cis Sutlej jagirs do not fall 350 within the definition of jagirs contained in the Act and that accordingly the State had no authority to resume them under the provisions of the Act. And this contention is sought to be sustained on two ground: (i) that there was at no time any grant of the Cis Sutlej jagirs to their holders, much less any assignment of land revenue to them; and (ii) that even if there was such a grant, it was not one made by or on behalf of the State Government as required by section 2 (1). It is argued that if either of these contentions succeeds, the jagirs in question would fall outside the purview of the Act, and the State would have no right under its provisions to resume them. It will be convenient at this stage to set out the relevant provisions of the Act. Section 2 (1) defines "jagir" as follows: " "jagir" means (a) any assignment of land revenue made by or on behalf of the State Government; or (b) any estate in land created or affirmed by or on behalf of the State Government carrying with it the right of collecting land revenue or receiving any portion of the land revenue; or (c)any grant of money made or continued by or on behalf of the State Government which purports to be or is expressed to be payable out of the land revenue; or (d) any grant of money including anything payable on the part of the State Government in respect of any right, privilege, perquisite or office; and includes any such grant or assignment existing in favour of Cis Sutlej jagirdars. " 351 "Jagirdar" is defined in section 2 (2) as meaning the holder of a jagir. Section 2 (5) defines State Government as follows: "State Government" (a) as respects any period before the 1st November 1956, shall mean: (i) the Government of the Patiala and East Punjab State Union or any of the Indian States which formed into the Patiala and East Punjab States Union on the 20th August, 1948 and (ii) the Government of the State of Punjab and all predecessor Governments thereof by whatever name called, the Governor General or the Governor General in Council, as the case may be, and the Sikh Rulers, but shall not include the Central Government as defined in the , after the period commencing on the 15th August, 1947. (b) as respects any period after the 1st November, 1956 shall mean the Government of the State of Punjab. " Section 3 enacts that "Notwithstanding anything to the contrary contained in any law or usage any grant settlement, sanad or other instrument, or any decree or order of any Court or authority, all jagirs shall, on and from the commencement of this Act, be extinguished and stand resumed in the name of the State Government. It is common ground that the jagirs which are concerned in the present writ petitions and appeals consist of a right to the revenue payable, on lands, and not of any estate such as will fall under section 2 (1) (b) of the Act and that they must fall, if at all within section 2 (1) (a). Therefore the discussion narrows 352 itself to the question whether there was, as required by section 2 (1) (a) of the Act, any assignment of the revenue of these jagirs and whether such assignment was by the State Government. On the first question, as to whether there was assignment of land revenue, the contention of the petitioners and of the appellants and they will hereafter be referred to compendiously as jagirdars is that the so called jagirs are not jagirs as ordinarily understood, that they were not the subject matters of any grant by any State that they were in fact originally independent States held by rulers with sovereign rights, that in course of time the British Government imposed their sovereignty over them, and finally took over the administration of the State and paid the revenue collected therefrom to the rulers, not as person to whom the land revenue had been assigned, because there was no such assignment but as sovereigns of the States. Therefore, it is contended, the co called jagirs are not within the definition of section 2 (1). That brings us on to the question of the true status of the Cis Sutlej jagirdars. The origin of these jagirs goes back to 1763. The collapse of the Moghul Empire had created a void in the political ,stage of this country, and many were the powers which stepped in with the ambition of establish ing their sovereignty. The British had established their rule and bad extended their dominion up to the Jumna. The Sikhs had also developed during this period from being a purely religious sect into a military Organisation, and established several States beyond the Sutlej. The tract of territory between the Jumna and the Sutlej was at this time under the administration of a weak Afghan Governor called Zain Khan. The policy of the British during this period was to hold the Jumna as the frontier, and so they were indifferent to the fate of this Cis Sutlej area. But the Sikh Chiefs 353 beyond the Sutlej could not resist the temptation of overthrowing the Afghan Governor, seizing his territory and establishing themselves as its rulers. In 1763 the storm burst when a number of them crossed the Sutlej, overwhelmed the Afghan Governor and occupied the whole country upto Jumna. "Tradition still describes", says Cunningham in his History of the Sikhs, P. I 10, I 'how the Sikhs dispersed as soon as the battle was won and how riding day and night each horseman would throw his be It and scabbard, his articles of dress and acooutrement, until he was almost naked into successive villages to mark them as his. " when the conquest was over each Chief declared himself the ruler of the territory which he was able to occupy, and constituted himself its sovereign. This state of affairs continued until 1806. By this time, Ranjit Singh the ', 'Lion of the Punjab", had built up a powerful State across the Sutlej. He had already subdued the petty rulers within that area and was turning his attention to the territories 'south of the Sutlej and had occupied some of them. The Cis Sutlej rulers became alarmed about their future and appealed for protection to the British, who had, by this time, changed their policy of non intervention. The appeal was welcome, and met with prompt response. The result was that in 1809 the British entered into a treaty with Ranjit Singh whereby he surrendered his acquisitions south of Sutlej and agreed not to interfere with the Cis Sutlej States. And this was followed by a proclamation by Colonel Ochterlony in May 1809 whereby the Cis Sutlej Chiefs were assured of their rights as sole owners of their possessions and exempted from payment of tribute, but were required to furnish supplies to the British Government and assist them against their enemies. The British Government also promulgated a rule that whenever any of the rulers died without issues, his State would lapse to the British Government. 354 This was the position until 1846 when a drastic change in the situation took place. In 1845, there was war between the British and the Sikhs, and in that war the Cis Sutlej rulers far from helping the British against the Trans Sutlej Sikhs, were either unsympathetically neutral or actively hostile to them, and that brought about a change in the policy of the British Government towards them. The position is thus stated by Kensington in the Ambala Gazetteer at p. 26: "Having thus already lost the confidence of the Government the Sikh Chiefs in the Sutlej campaign forfieted all claim to consideration. It was seen that the time had arrived for the introduction of sweeping measures of reform and the Government unhesitatingly resolved upon a reduction of their privileges. Several important measures were at once adopted. The police jurisdiction of most of the chiefs was abolished, the existing system being most unfavourable to the detection and punishment of crime. All transit and customs duties were also abolished; and thirdly, a commutation was accepted for the personal service of the chief and his contingent. The despatch of the Governor General embodying this resolution was dated November 7th, 1846. " While the sweeping changes aforesaid were being introduced, the second Sikh War broke out and that ended in the annexation of the Punjab. And with that the Deed for maintaining appearances and for recognizing the Cis Sutlej Chiefs as rulers came to an end. The British Government then proceeded to act swiftly and firmly, and in June, 1849, they made a declaration that the Chiefs should "cease to hold sovereign powers, should lose all criminal, civil and fiscal jurisdiction, and should be considered as no more than ordinary subjects of the British Government in the possession of certain exceptional 355 privileges" (1). Pursuant to this declaration, the Chiefs were stripped of all their governmental functions and the final denouement took place in 1852 when the British took over the collection of revenue for the jagir lands. The rules for settlement of revenue were made by them, and the actual settlement and collection of revenue were made under their authority, and out of the collections the jagirdars were paid their share. On these facts, the question is whether it can be said that their was an assignment of the land revenue to the jagirdars. Express grants to them, there were none. The point in debate before us is whether grants of the land revenue could be implied from the facts stated above. A somewhat similar question came up for decision before this Court in Thakar Amar Singhji vs State of Rajasthan (2) with reference to a class of jagirdars in the State of Rajasthan known as Bhomicharas. They were once the rulers of the territories which were claimed to be jagirs, and later on the State of Jodhpur imposed its suzerainty over them and exacted an annual payment called "Foujbal". The Bhomioharas contended that they had come into possession of the territories as rulers and held them as rulers and not as jagirdars under grants made by any ruler. In repelling this contention, this Court held that a grant may be implied as well as express, and that on the facts which were Proved, the Bhomicharas, though they held originally as rulers, must be held to have been reduced to the status of subjects, and that their position was that of jagirdars under an implied grant. The position of the Cis Sutlej jagirdars bears a close analogy to that of the Bhomicharas in Thakur Amar Singji 's case (2). They became rulers of the territories when they took possession of them by conquest in 1763. The first inroads into their (1 ) Griffin 's "Rajas of that Punjab", P. 199. (2) ; 356 sovereignty were made in 1809 when the British established their suzerainty over them and further declared that the territories of the rulers who died without heirs would escheat to them. Then in 1846 the British Government deprived them of police jurisdiction, and the power to levy customs, and in 1849, of all their sovereign functions. It is not disputed that as a result of all these acts they were reduced to the position of ordinary subjects, that indeed being the objective of the British Government as avowed in their declaration of June, 1849. It is with reference to this background that we must examine the true character of the revenue settlement made in 1852. If the jagirdars had sunk to the position of subjects on that date the payment of revenues to them by the British Government can only be on the basis of an implied grant to them. Learned Counsel for the jagirdars however demur to this conclusion. They contend that the position of the Cis Sutlej jagirdars differs fundamentally from that of the Bhomicharas in Thakur Amar Singhji 's case (1), that the latter were conquered by the rulers of Jodhpur and compelled to pay to them a tribute called "Foujbal", but that the Cis Sutlej Chiefs were never conquered by the British, and never paid any tribute to them, that they were receiving revenue from the lands as rulers before the British came on the scene, and that they continued to receive the same without a break even after the British had established themselves, and that there was nothing which the British Government did from which a resumption and a re grant could be inferred. Under the circumstances, it is said, the, payment of land revenue to them must be related to their status as sovereigns, and if the British Government took upon themselves the work of settlement and collection of land revenue, it was (1) [ ; 357 oh their behalf and under their authority and under an implied arrangement with them. The assumption underlying this argument is that, as the cis Sutlej Chiefs ;are not conqaered by the British, their status must necessarily be that of sovereigns, and that in consequence the payment of land revenue to them could not be as jagirdars holding under an implied grant from the Govern ment. That, however, is not correct. It is settled law that conquest is not the only mode by which one State can acquire sovereignty over the territories belonging to another State, and that the same result can be achieved in any other mode which has the effect of establishing its sovereignty. Thus, discussing what is an , 'act of State", the Judicial Committee observed in Cook vs Sir James Gordon Sprigg (1) : "The taking possession by Her Majesty, whether by cession or by any other means by which sovereignty can be acquired, was an act of State ' " To the same effect are the 'following observations of Lord Danedin in Vajesing Jaravarsingji vs Secretary of State for India in Council (2) : "When a territory is acquired by a sovereign State for the first time, that is an act of State. It matters not how the acquisition has been brought about. It may be by conquest, it may be by cession following on treaty, it may be by occupation of territory hitherto unoccupied by a recognised ruler." Laying down the law in similar terms, this Court observed in M/s. Dalmia Dadri Cement Co. Ltd.v. The Commissioner of Income tax (3) : "The expression act of State ' is, it is scarcely necessary to say not limited to hostile (1) (2) (1923 24) L. R. 51 I. A. 357, (3) [1959] R. 729, 739. 358 action between rulers resulting in the occupa tion of territories. It includes all acquisitions of torritory by a sovereign State for the first time, whether it be by conquest or cession. Vide Vajesingji Joravar Singji V. Secretary of State and Thakur Amar Singji vs State of Rajasthan . " And, more recently, this question has been considered by this Court in Promod Chandra Deb vs The State of Orissa (1), and the result was thus stated : " 'Act of State ' is the taking over of sovereign powers by a State in respect of territory which was not till then a part of its territory, either by conquest; treaty or cession, or otherwise. " The fact, therefore, that the Cis Sutlej jagirdars were not conquered by the British does not conclude the question as to whether they arc to be regarded as sovereigns or not. That must depend on who were in fact exercising sovereign powers over the territories in the States the Chiefs or the British. If the latter, then it must be held that the sove reignty over the area had passed to them, otherwise than by conquest, and that the true status of the Chiefs was that of subjects. Viewed in this light, the case does not present much of a problem. It has been already seen that from 1809 onwards, the Chiefs had been gradually stripped of their powers as sovereigns and that the process of disintegration was completed in 1849. It is indeed conceded on behalf of the jagirdars that after that date it was the British Government which was exercising sovereign powers over the territories and that the Chiefs had been rodaced to the status of its subjects. But the contention that is urged is that even when every thing else had been (1) Writ Petitions Nos. 79 of 1957, 167 and 168 of 1958 and 4 of 1959 decided on November, 16, 1961. 359 lost, there was still one relie of sovereignty left with them and that was the right to receive the land revenue. If this were the true position, the status of the jagirdars would be that of subjects of the British in respect of all matters except as to the right to receive revenue, in respect of which alone they would have to be regarded as sovereigns. This is clearly untenable, because a person cannot be both a sovereign and a subject at the same time. Dealing with this identical contention, this Court observed in Thakur Amar Singhji 's case (1) : "The status of a person must be either that of a sovereign or a subject. There is no tertium quid. The law does not recognise an intermediate status of a person being partly a sovereign and partly a subject, and when once it is admitted that the Bhomicharas had ack nowledged the sovereignty of Jodhpur their status can only be that of a subject. A subject might occupy an exalted position and enjoy special privileges, but he is none the less a subject ; and even if the status of Bhomicharas might be considered superior to that of ordinary jagirdars, they were also subjects." (pp. 336 337) If the status of the Cis Sutlej jagirdars is in all other respects that of subjects, the right to receive the revenue collections must also be ascribed to their character as subjects, and that can only be under an implied grant. But it is contended that the implication of a grant in favour of the jagirdars could not be made here as in the case of Bhomicharas in Thakur Amar Singhji 's case (1), because a proposal for resumption and re grant of the territories of the Cis Sutlej Chiefs was actually put forward in 1846 but was negatived. Reference was made to the following (1) [19551 2 section C. R. S03. 360 account thereof given in J. M. Douie 's "Punjab Land Administration Manual", 1931, p. 45 para 102: "It was indeed proposed in 1846 after the first Sikh War to declare all the estates forfeit on account of the laches of their holders, and to re grant them under sanads from the British Government. But Lord Hardinge deemed it impolitic to proclaim to all India the misconduct of the Cis Sutlej Chiefs and negatived proposal. In a, sense then the Cis Sutlej jagirdars, great and small, are mediatized rulers, and little though they have as a body deserved at our hands, this fact should not be lost sight of in our dealings with them. " The argument is that though a grant could be implied in certain circumstances where no express grant was forthcoming, that could not be done when a proposal for grant is shown to have been actively considered and rejected. This contention sounds plausible but breaks down when the reason for the rejection of the proposal is examined. That was, as stated in the despatch of Lord Hardinge dated November 17, 1846, that "a general measure of resumption would create alarm and must be preceded by a public declaration of the disloyalty of the largest portion of the Sikh protected States explaining the grounds of forfeiture," and this was considered inexpedient. Consistently with this reason it is impossible to hold that the British Government, in declining to make a resumption and re grant, intended to continue the recognition of the Chiefs a,, sovereigns. On the other hand, the true inference to be drawn is that the British wanted to give the chieftains only the status of jagirdars but for reasons of policy they sought to do it in such manner as to avoid publicity, and that is why the proposal for making resumption and regrant was not adopted. In the very despatch of 361 Lord Hardinge dated November 17, 1346, wherein the proposal for resumption and re grant was dropped, it was stated that there was no need for it as the same ends could be obtained by adopting certain measures such as the taking over of the police administration and customs and the like. The reason, therefore, for not making a resumption and an express grant is one which would support an inference of implied grant. An argument is also sought to be built on the description given of the Cis Sutlej jagirdars as "mediatized rulers" in the extract from J. M. Douie 's "Punjab Land Administration Manual" already given, that their status is that of sovereigns. This expression was originally used with reference to German Princes in Holy Roman Empire who, having been at one time vassals of the Emperor, were subsequently subjugated by other Princes who were also vassals of the Emperor. The meaning of the word "mediatise" in modern usage is given in The Oxford English Dictionary, Vol. VI, P. 292, as "annex (Principality) to another State, leaving former sovereign his title and (usually) more or less of Ilia rights of Government". It might be 'correct to speak of the Chiefs as mediatized rulers in 1846, when, though deprived of their powers in matters of police and customs, they continued to exercise civil and fiscal powers. But when they were divested in 1849 of all their Governmental powers they (, eased to be rulers, "mediatized" or otherwise, and when the revenue settlements were made in 1852, they had no vestige of sovereignty left in them, and had become ordinary subjects of the British with some privileges. The true character of the revenue settlements made with the Cis Sutlej jagirdars is brought out correctly, in our opinion, in the following observations in Baden Powell 's "Land Systems of British India", Vol. 11 at p. 701: 362 "Under our Settlement arrangements, the jagirdar now receives the revenue, the original land holding communities or individuals being settled with and retaining full proprietary rights. He in fact is a mere assignee of the revenue, taking.part of what otherwise would go to the State. " Even more explicit is the statement of the position by Kensington in the Ambala Gazetteer, pp.27 28: "The final step necessitated by the march of events was taken in 1852 when the revenue settlement begun for British villages in 1847 was extended to the villages of the chiefs. Thereafter the chiefs have ceased to retain any relies of their former power except that they are still permitted to collect their revenues direct from their villages, the cash assignment of revenue. They have sunk to the position of jagirdare but as such retain a right to the revenue assigned to them in per petuity. " It was argued by the learned Advocate General who appeared for the respondent that subsequent to 1852 there has been a course of legislation relating to the jagirs which proceeds on the basis that their holders were subjects. The preamble to the Punjab Land Revenue Act, 1871 (Act 33 of 1871), under which land revenue was settled is as follows: "Whereas the Government of India is by law entitled to a proportion of the produce of the land of the Punjab to be from time to time fixed by itself and whereas it is expedient to consolidate and define the law relating to the settlement and collection thereof, and to the duties of the Revenue Officers in the Punjab. " It is under this Act that the revenue settlements for the jagir lands are also made. This shows that in exercising fiscal jurisdiction, the British Government 363 considered itself as acting in its sovereign capacity. Then there is Punjab Descent of Jagirs Act,, 1900 (Punjab Act IV of 1900), which introduced in the , as. 8 to 8C enacting rules of descent "in respect of succession to any assignment of land revenue" and providing for the recognition of successors to the deceased jagirdars by the Provincial Government on certain conditions specified therein. We have then the Punjab Jagire Act V of 1911 dealing with the same topic. The preamble to the Act states that "it is expedient to consolidate the law governing the assignments of land revenue and other grants hitherto known as jagirs, and to make more precise provisions regarding the manner in which such assignments are to be made or continued in the future. " Jagir is defined in section 2 in torms substantially the same as under the present Act. This Act repeals as. 8 to 80 of the , which were inserted by the Punjab Descent of Jagirs Act IV of 1900, and reproduces them in as. 7 to 10. Section 7(1)(b) provides for the acceptance by the jagirdars of the rules of descent framed by the Government by executing a written instrument, and it has been stated before us that the jagirdars have accepted the rules in the manner provided in the section. By way of sample, the copy of the acceptance executed by the petitioner in Writ Petition No. 82 of 1960 has been marked as part of the record. Oa these materials, the conclusion would appear to be irresistible that the right of the Jagirdars to raceive land revenue rests on implied grants by the British Government. It must be mentioned that in Abdul Ghafoor Khan vs Amar arji Singh, Regular Second Appeal No. 561 of 1946 in the Punjab High Court there are ob. servations of the learned Judges. Mahajan and Teja Singh, JJ., that there was no gift of the jagir lands or assignment of the land revenue by the British Government to the Cis Sutlej jagirdars, and they are relied on as authority for the contention that 364 there was no grant to them express or implied. But the point for decision in that case was whether these jagirdars could alienate their interests beyond their lifetime. It was held that they could not and the reason therefor was thus stated: "After the annexation of the Punjab they (Cis Sutlej jagirdars) were deprived of vestiges of sovereignty that still remained in them and they were transformed and given the status of jagirdars, but their possessions, holding and dominions whether in land or other properties like forts and buildings were not in any way disturbed or taken away. They held them in the same status and position as before. " The dispute in that appeal related to properties of the kind mentioned above and not to land revenue, and we are unable to regard the observations relied on for the jagirdars as authority for the position that no grant in respect of the assignments of the land revenue could be implied in their favour. In the resultwa must hold that the jagirs which are subject matter of these proceedings fall within section 2(1)(a) of the Act. It is next contended that even if an assignment of land revenue could be. implied in favour of the jagirdars, that could only be held to hive, been made by the British Government and not by the State Government as required by section 2(1)(a), and that, in consequence, the respondent had no right to resume the jagirs in question under the provisions of the Act. Whateverforce there might have been in this contention, if I hequestion had to to be decided only on the. terms of s.2(1)(a), we have in section 2(5) a definition or ' State Government which 365 is decisive of the question. According to that definition, "State Government" includes "the Government of the State of Punjab, and all predecessor Gevernments thereof, by what ever name called, the Governor General or the Governor Generalin Council as the case may be. " It is not disputed that these words are wide enough to include the British Government which made the grant, but it is contended that this definition was not in the Act as originally enacted and was inserted by the Punjab Resumption of Jagirs (Amendment) Act, 1959, and that the rights of the parties should be determined in accordance with the law as it stood prior to the amendment. There is no force in this contention, because under section 1(2) of the Amendment Act, retrospective operation is given to it as from November 14, 1957. But then it is urged that the amendment was not within the legislative competence of the Legislature of the State of Punjab and is null and void. The grounds therefor are thus stated in Petition No. 82 of 1960 : "This is nothing but a colourable legislation. The State legislature has no authority to convert Central Government into State Government and legislate on Central subject. The so called jagir being not a grant by the State Government, the impugned Act has no application and the amended definition of State Government is a fraud on the Constitu tion." (para 17). There is no substance in the contention that the Amendment Act is colourable and incompetent. The subject matter of the legislation is resumption of jagirs. Though the contention was raised. in the petitions that this was not a topic within the competence of the State Legislature, as there was no such entry in List II to the Seventh Schedule,no 366 argument was advanced in support, of it. And clearly it could not be, as legislation on resumption of jagirs in one relating to lands, and land revenue and would clearly fall under entries 18 and 45 of List II, which are as follows : Entry 18 , , 'Land, that is to say, rights in or over land, land tenure including the relation of landlord and tenant, and the collection of rents transfer and alienation of agricultural lands; land improvement and agri cultural loans; colonization. " Entry 45 : "Land revenue., including the assessment and collection of revenue,the maintenance of lands records, survey for revenue purposes and records of rights, and alienation of revenue. " If the principal legislation is intra vires, it is difficult to see how an amendment thereof with respect to matters properly pertaining to the subject matter covered by it could be ultra vires. It is immaterial for the purpose of resumption, whether the lands sought to be resumed were granted by the State of Punjab as it is now constituted or by any Government which preceded it. So long as the lands are within the, State of Punjab, the legislature has full competence to enact a law providing for their resumption under entries 18 and 45. Indeed if the words "made by or on behalf of the State Government" in 3. 2 (1)(a) had been omitted in the, principal Act and jagir defined simply as "any assignment of land revenue" the legislation would have been intra vires, and in that case the State could have resumed the jagirs by whomsoever they might have been granted. But it chose to add the words "made by or on behalf of the State Government", and that gave occasion for the contention that the legislation did not in fact reach jagirs granted by the British Government. Then, with a view to clarify the position, 367 and set the controversy at rest,, the legislature intervened and enacted the Amendment Act of 1959, inserting the impugned definition of "State Government". We are unable to see what the lack of vires is under which this amendment suffers. We must reject this contention also. This disposes of all the points raised on the merits in the Writ Petitions and Civil Appeals. In Civil Appeal No. 453 of 1961 preferred by one of the jagirdars, Umrao Singh, his son Satinder Singh intervened, and he asks that suitable directions might be given for protecting his interests in. the compensation amount which is payable to the appellant Under the Act. He states that under the law the Cis Sutlej jagirdar is not an absolute owner of the jagir, that he has only a right to enjoy it without any power of alienation and that after his life time the next lineal descendant would take it free from all encumbrances created by the previous owner, that the rights of the jagirdar over the compensation amount due on resumption under the Act could only be the same as over the jagir, and that if that is paid to him, his reversionary rights would be Jeopardised and that therefore adequate provision should be made for protecting them. Our attention has been invited to the decision of this Courtin Satinder Singh vs Umrao Singh(1), where compensation awarded on the acquisition of jagir lands was apportioned equally between the jagirdar and his son. But there the lands had been acquired under the Land Acquisition Act, 1894, which contains provisions for deciding who is entitled to the compensation amount. But here we are hearing an appeal against an order dismissing a Writ retition under article 226, challenging ire vires and applicability of the Punjab Resumption of Jagirs Act, 1957, and adjudication of rival claims to the compensation amount will be wholly foreign to its scope. (1) A. I. R. 961) section C. 908 368 But it is pointed out for the intervener that on his application this Court has ordered stay of payment of a part of the compensation amount to the appellant pending the disposal of the, appeal, and that a similar direction might now be made in the Judgment, staying payment of a part of the amount for a specified period, so as to enable him to take steps to protect his rights. But that was an interim order made pending the appeal, and no such order could be passed in the appeal unless it follows on a decision of the rights of the parties, which is, an already stated, outside the scope of the present proceedings, vide the state of Orissa vs Madan Gopal Rungta 0). We do not therefore propose to say anything on the rights of the intervener or give any directions with reference to the payment of the compensation amount. It is open to the intervener to take other and appropriate proceedings to vindicate his rights. Before concluding, it has to be noted that in Writ Petition No. 148 of 1961 there, are as many as 72 Petitioners. some of whom are stated not to belong to the category of Cis Sutlej jagirdars. Their joinder is clearly improper. 'It is also said that three of them, Petitioners Nos. 66, 68 and 69, had filed Writ Petitions under article 226 of the Cons tituation in the Punjab High Court, raising the same contentions as in the present, that the said petitions had been dismissed on the merits, and no appeal had been preferred against the Orders of dismissal, and in consequence, the concerned petitioners cannot, on the decisions of this Court, maintain this petition. But as we are dismissing these petitions on the merits, no further notice need be taken of these points. In the result, the petitions are dismissed with costs, one hearing fee, and the appeals are dismissed with costs one set. Petitions and appeals dismissed. (1) [1952] S.C.R. 28.

The Punjab Resumption of jagirs Act, 1957, came into force on November 14, 1957, and the State of Punjab proceeded to take action thereunder for resuming the jagirs. The petitioners who were holders of certain jagirs in that State known as the Cis Sutlej jagirs claimed that they could not be resumed under the provisions of the Act because they did not fall within the definition of jagir contained in section 2(1) of the Act on tile grounds that there was at no time any grant of the Cis Sutlej jagirs to their holders much less any assignment of land revenue to them, and that even if there was such a grant, it was not one made by or on behalf of the State Government as required by section 2(1) (a) of the Act. The history or these jagirs showed that the jagirdars were originally rulers of the territories when they took possession of them by conquest in 1763, but in course of time after the British came on the scene, they were gradually stripped of all their powers as sovereigns, and in 1852 the British took over the collection of revenue of the jagir land , and out of the collections the jagirdars were paid their share. Subsequent to 1852 there was a course of legislation relating to the jagirs. The question was whether the assignment of land revenue to the Cis Sutlej jagirdars was made on the basis of an implied grant. The petitioners case was that as the Cis Sutlej Chiefs were never conquered, the payment of land revenue to them must be related to their status as sovereigns and that the collection of the land revenue was made only under all im plied arrangement with them. Held, that the status of the Cis Sutlej jagirdars was only that of subjects and that the payment of revenue to them by 347 the British Government was only on the basis of an implied grant to them. Though the Cis Sutlej Chief were not conquered by the British, since the latter were in fact exercising sovereign powers over the area it must be held that sovereignty had passed to them otherwise than by conquest. M/s. Dalmia Dadri Cement Co. Ltd. vs The Commissioner of Income tax, [1959] section C. R. 729, Thakur Amar Singji vs State of Rajasthan, and Vajesingji Jorawar Singji vs Secretary of State, [1924] L.R. 51 I.A. 357, relied on. Held, further that the British Government which had made the grant was the "State Government" within the meaning of section 2(5) of the Punjab Resumption of jagirs Act 1957, and that the jagirs in question were within the definition of "jagir" in s.2(1) of the Act. Held, also, that the Act was within the legislative com petence of the State of Punjab under entries 18 and 45 of List 11 of the Seventh Schedule to the Constitution of India.

Appeal No. 130 of 61. Appeal by special leave from the judgment and decree dated April 25, 1959 of the Madhya Pradesh High Court in First Appeal No. 139 of 1955. M.C. Setalvad, Attorney General of India, section T. Desai, J. B. Dadachanji, 0. C. Mathur and Ravinder Narain, for the appellants. Sarjoo Prasad and G. C. Mathur, for respondents No. 1 and 2. Ganpat Rai, for respondent No. 3. 1962. February 23. The Judgment of the Court was delivered by SHAH, J. This appeal with special leave is against the decree of the Madhya Pradesh High Court confirming the decree of the 1st Additional District Judge, Jabalpur in Civil Suit No. 12 A of 1952. The dispute between the parties arose in a suit for partition of joint family property. The parties are Digambar Jains of the Porwal Sect and are residents of Jabalpur which at the material time 421 was in Madhya Pradesh. The following pedigree explains the relationship between the parties Garibdas=Mst. Khilonabai d. 24.7.34 (Def. 3) d.3.7.56 Gulzarilal d. 13.4.39 Munnalal Padamchand d.10.1.36 Ramchand (Def 1) (Def 2) Pyaribabu widow Bhuribai Chandrani bahu (Def. 4) (Def. 11) (Def. 8) Adupted son Rajkumar (Def. 12) adopted 26.7.52 Saheblal Ballu Nand Hiralal Ishwari Kumar Prasad (Plaintiff) (dead) (Def. 5) (Def. 6) (Def.7) Rajendra Kumar Abhay Kumar (Def 9) (Def. 10) Saheblal son of Munnalal filed Suit No. 12A of 1952 in the Court of the 1st Additional Subordinate Judge, Jabalpur on June 21, 1952, for a decree of partition and separate possession of his 1/12th share in the joint family property. He claimed that in the property his father 's branch was entitled to have a half share and the remaining half was owned by 422 Ram Chand and his branch. The Additional District Judge ordered that Khilonabai grandmother of Munnalal and Ram chand the wives of Munnalal and Ramchand and their sons and Bhuribai (widow of Padamchand) and Rajkumar who claimed to be a son of Padam Chand by adoption by Bhuribai on July 26, 1952, be impleaded as defendants to the suit. At the trial of the suit the right of Saheblal to a share in the property was Dot questioned . the dispute principally turned upon the claim made by Bhuribai and her adopted son Rajkumar to a share in the property. Padamchand had died before the enactment of the Hindu Womens ' Rigbt to Property Act, 1937, and his widow could not claim by virtue of that Act a share in the property of the family. But Bhuribai and Rajkumar pleaded that the parties were governed in the matter of adoption by the customary law prevalent amongst the Jains of Central India, Madhya Pradesh, Vindhya Pradesh. North and Western India, and Rajkumar as a son adopted by Bhuribai to Padam Chand became a coparcener in the joint family and entitled to a share in the property and accretions thereto. The validity of the adoption of Rajkumar was challenged on many grounds, one only of which is material in this appeal. It was submitted by the contesting defendants and Bhuribai had no authority express or implied from her husband Padam Chand to adopt a son and that the adoption of Rajkumar as a son without such authority was invalid. '.the Additional District Judge rejected this plea and ordered a preliminary decree for partition and declared that the share of the plaintiff was 1/24th, of Munnalal, his wife and 3 sons collectively was 5/24th, of Ramchand and his sons 1/4th, of Khilonabai 1/4th and the remaining 1/4th share belonged to Rajkumar. 423 Against them decree, Munnalal, Ramchand, Khilonabai, wife and sons of Munnalal and the wife and sons of Ramchand who were defendants 1 to 10 preferred an appeal to the High Court of Madhya Pradesh. During the pendency of this appeal Khilonabai died on July 3, 1956 and Ramchand and Munnalal applied to be impleaded as her legal representatives in respect of the interest in the property awarded to Khilonabai by the preliminary decree. By order dated December 12, 1957, the District Judge held that the interest of Khilonabai devolved upon the applicants by virtue of sections 15 and 16 of the which was brought into operation on June 14, 1956, and that the sons of Munnalal, Ramchand and Padam Chand could not take a share in Khilonabai 's interest. Before the High Court two questions were canvassed: (1) as to the factum and validity of the adoption of Rajkumar, and (2) devolution of the share of Khilonabai declared by the preliminary decree on her death. The High Court upheld the finding of the trial Court that Rajkumar was in fact adopted by Bhuribai as a son to her husband on July 26, 1952, and that amongst the Jains residing in the North West Province, Central India, Northern India and in Bombay a widow could adopt a son to her deceased husband without any express authority in that behalf In so holding the High Court relied upon the judgments of the Privy Council in Pemraj vs Mst. Chand Kanwar and Mangibai Gulabchand vs Suganchand Baikamcand (1). But the High Court diclined to accept the view of the trial Court that the right of Khilonabai declared by the preliminary decree devolved upon Munnalal and Ramchand alone. In their view, Khilonabai 's interest under the decree being incohate was not "Possessed" by her within. the meaning of section 14 (1) (1947) L.R. 74 I.A. 254. (2) A.I.R. (1948) P.C. 177. 424 of the , and on her death it merged into the estate, The High Court observed : "The result is that the interest of Smt. Khilonabai remained incohate and fluctuating so that after her death, the interest declared by the preliminary decree is available for partition as joint family property and consequently ss.15 and 16 of the are inapplicable to the interest. As the property never became her absolute property by virtue of s.14 of the Act, the same remained joint family property. " Accordingly the decree of the trial Court was modified and 1/3rd Share in the joint family property was awarded to Rajkumar, 1/3rd to the branch of Munnalal and the remaining 1/3rd to the branch. of Ramchand and adjustments were made on that footing in the shares of the plaintiff and other members of the family. In this appeal by defendant No. 1 (Munnalal) 2 (Ramchand) and 4 to 10, three contentions were raised : (1) in the absence of express authority from her husband, Bhuribai could not adopt a son, (2) that the 'interest of Khilonabai under the preliminary decree became her absolute property by virtue of s.14 of the and on her death it devolved upon her grandsons Munnalal and Ramchand defendants 1 and 2 and (3) the trial Court was in error in delegating to a Commissioner judicial function, such as, ascertainment of property to be divided and effecting parti tion. The third question is easily answered. The trial court appointed a commissioner to propose a partition of joint family property, and for that purpose the court authorised him to ascertain the property, the debts which the family owed and also the individual liability of the parties for the debts. For deciding those questions the Commissioner was empowered to record statements of the parties, frame 425 issues and to record evidence as might be necessary. The commissioner was also directed to submit his proposals relating to the right of Bhuribai to be maintained out of the joint family property. This order, it appears, was passed with the consent of all the parties. It is true that the decree drawn up by the trial Court is not strictly in accordance with the directions given in the judgment. But it is manifest that the trial Judge only directed the Commissioner to submit his proposals for partition of the property, and for that purpose authorised him to ascertain the property which was available for partition and to ascertain the liability of the joint family. By so authorising the Commissioner, the trial Court did not abdicate its functions to the comissioner : the commissioner was merely called upon to make proposals for partition, on which the parties would be heard, and the Court would adjudicate upon such proposals in the light of the decree, and the contentions of the parties. The proposals of the commissioner cannot from their very nature be binding upon the parties nor the reasons in support thereof. The order it may be, remembered was made with the consent of the parties and no objection to the order was, it appears, pressed before the High Court. We do not think that any case is made out for modifying that part of the order. The parties to this dispute are Digamber Jains of the Porwal sect and are resident of Jabalpur. Jains have generally been regarded as heterodox Hindus and in the absence of special custom they are governed by the rules applicable to Hindus. As observed by the Privy Council in Sheokuarbai vs Jeoraff.(1) The Jains are of Hindu origin; they are Hindu dissenters, and although as was pointed out by Mr. Mayne in paragraph 46 of his Hindu Law and Usages "Generally adhering to ordinary Hindu law, that is, the law of the three (1) 426 superior castes, they recognise, no divine authority in the Vedas and do not practise the Shradhs, or ceremony for the dead." "The due performance of the Shradhs, or religious ceremonies for the dead, is at the base of the religious theory of adoption, but the Jains; have so generally adopted the Hindu law that the Hindu rules of adoption are applied to them in the absence of some contrary usage x x x." But amongst the Jainsa custom enabling a widow to adopt a son to her husband without express authority has been reco. gnised by judicial decisions spread over a period longer than a century. In Pemraj vs Musammad Chand Kanwar(1), the Judicial Committee of the Privy Council after a review of the case law observed : " x x x x, in many other parts of India" (parts other than the Provinces of Madras and the Punjab) "it has now been established by decisions based on evidence from widely separated districts and from different sects that the Jains observe the custom by which a widow may adopt to her husband without his authority. This custom is based on religious tenants common to all sects of Jains, and particularly their disbelief of the doctrine that the spiritual welfare of the deceased husband may be affected by the adoption, and though it cannot be shown that in any of the decided cases the parties were of the Khandelwal sect, yet in none of the cases has a distinction been drawn between one sect and another. It is now in their Lordship,% ' opinion no longer premature to hold that the custom prevails generally among all Jains except in those areas in which there are special reasons, not operative in the rest of India, which explains why the custom has not established itself. Mayne, in his treaties on Hindu Law and Usage, at page 209, has lent the weight of his authority to the proposition that among the Jains, except in the Madras Presidency a sonless widow can adopt a son to her (1) (1947) L.K. 74 I.A. 254. 427 husband without his authority or the consent of his sapindas". This view was reiterated by the Privy Council in a case reported in Mangibai Gulabchand vs Suganchand Bhikamchand (1). The Attorney General for the appellants, however, contends that there is no evidence of a custom authorising the widow of a Porwal Digamber Jain residing in Jabalpur to adopt a son to her husband without express authority. Counsel sub mitted that the observations in the two cases relating to the custom of adoption must be restricted to the sects to which the parties to these cases belonged, and in so far as they purport to extend the custom to all Jain residents in India outside Madras and the Punjab they are mere dicta and not binding upon this Court. In Pemraj 's case the parties belonged to the Khandelwal sect domiciled and resident in Ajmer and in Mangibai 's case the parties were Marwari Jains of the Vis Oswal sect who having migrated from Jodhpur had settled down in the Thana District of the Bombay Province, but the opinion of the Judicial Committee expressly proceeded upon a well recognised custom applicable to all Jains in the territory of India (excepting Madras and the Punjab) and not upon proof of a restricted custom governing the sects of Jains to which the parties belonged. Undoubtedly, as observed by this Court in Saraswathi ' Ammal vs Jagadamhal (2) in dealing with the quantum of proof required to prove a family or loca I custom, " it is incumbent on a party getting up a custom to allege and prove the custom on which he relies and it is not any theory of custom or deductions from other customs which can be made a rule of decision but only any customs applicable to the parties concerned that can be the rule of decision in particular case. x x x (1). A.I.R. (1948) P.C. 177. (2) ; 428 Theory and custom are antitheses, custom cannot be a matter mere of theory but must always be a matter of fact and one custom cannot be deducted from another. A community living in one particular district may have evolved a particular custom but from that it does not follow that the community living in another district is necessarily following the same custom. " But the application of the custom to the parties to this appeal does not appear to proceed upon analogies or deductions. It governs the parties, because the custom has become a part of the law applicable to Jains in India (except in Madras and the Punjab) by a long and uninterrupted course of acceptance. A review of the cases decided by different Courts clearlyshows that the custom is generally applicable to Jains all over India, except the Jain domiciled in Madras and the Punjab. The earliest case of which a report is available is Maharaja Govindnath Bay vs Ray Chand (1) decided by the Saddar Court Calcutta in 1933. 'in that case the validity of an adoption by a Jain 'Widow of a son without express authority from her husband was questioned. The Court after consulting the Pandits held that by Jain law a sonless widow could adopt a son just as her husband for the performance of religious rites and that the section of the vitis or priests to the adoption is not essential. In Bhagwandas Tejmal V. Rajmal alias Hiralal Lachmidas(2) the Bombay High Court opined that the widow of a Jain was a delegate either by express or implied authority to adopt a son, but she could not delegate to another person that authority to adopt a son to her husband after her death. In Sheo Singh Rai vs Mussumut Dakho and Moorari Lal, (3) decided in 1878, the Privy 'Council affirmed the view of the North West Provinces High Court that a sonless widow of a Jain had the right of adoption without the permission of her husband or the consent (1) (2) (1873) 10 Bom. H.C. Rep. 241. (3) (1878) L.R. 5 I.& 87 429 of his heirs. In that case before the Subordinate Judge and before the High Court evidence was recorded of the custom applicable to Jains generally, in different place such as Delhi, Jaipur, Mathura, Banaras and it was held that ' the custom was established by evidence. The parties to the suit were Agarwal Jains of Meerut District, but decision of the Board proceeded upon a custom found on evidence to be common to all Jains. In Lakhmi Chand vs Catto Bai. (1) decided in 1886, again the power of a Jain widow to adopt a son to her deceased husband was held proved. In Manik Chand Golecha vs Jagat Settani, (2) decided in 1889, the High Court of Bengal upheld a custom in respect of adoption by a widow of an. Oswal Jain. The decision of the Court did not proceed upon any custom peculiar to the Oswal sect. In Harnabh Pershad alias Rajajee vs Mangil Das(3) decided in 1899, it was held upon the evidence consisting partly of judicial decisions and partly of oral evidence that the custom that a sonless Jain widow was competent to adopt a son to her husband without his permission or the consent of his kinsmen, was sufficiently established and that in this respect there was no material difference in the custom of the Aggarwal, Choreewal (Porwal), Khandwal and Oswal sects of the Jaim ; and that there was nothing to differentiate the Jains at Arrab from the Jains elsewhere. The judgment of the case proceeded upon an elaborate examination of numerous instances in which the custom was held established. In Manohar Lal vs Banarsi Das(4) and in Asharfi Kumar vs Rupchand(5) a similar custom was hold established. In the latter case a large number of witnesses were examined at different places and on a review of the decisions and the evidence the Court held the custom proved. The judgment of the Allahabad (1) All. 319. (2) Cal. 5 1 8. (3) Cal. (4) (1907) 1.L.R. 29 All. (5) All.197 430 High Court in Asharfi 's case was affirmed by the Privy Council in RupChand vs Jambu Prasad. (1) It may be stated that the right of a Jain widow to adopt without authority of her husband was not questioned before the Privy Council. In Jiwraj vs Mt. Sheokuwarbai the Court of the Judicial Commissioner ' Nagpur held that the permission of the husband was not necessary in the case of a Jain widow to adopt a son. This case was also carried to the Privy Council and the judgment was affirmed in Sheokuarbat vs Jeoraj (3). In Banarsi Das vs Samat Prasad (4) a similar custom was held established. The decisions in all these cases proceeded not upon any custom peculiar to the locali ty, or to the sect of Jains to which they belonged, but upon the view that being Jains, they were governed by the custom which had by long acceptance become part of the law applicable to them. It is well settled that where a custom is repeatedly brought to the notice of the Courts of a country, the courts may hold that custom introduced into the law without the necessity of proof in each. individual case. (Rama Rao vs Raja of Pittapur) (5). The plea about the invalidity of the adoption of Rajkumar by Bburibai must therefore fail. Khilonabai died after the was brought into operation on June 14, 1956. This Act by section 2(1)(b) applies to Hindus and also to persons who are Jains by religion. The preliminary decree was passed on July 29, 1955, and thereby Khilonabai was declared entitled to a fourth share in the property of the family. Section 14 of the provides: "14(1) Any property possessed by a female Hindu, whether acquired before or after the commencement of this Act, shall be (1) All. 217. (3) (2) A.I.R. (1920) Nag. 162. (4) All. 1019, (5) (1918) L.R. 4 5 1.A. 148. 431 held by her as full owner thereof and not as a limited owner. EXPLANATION. In this sub section ,property" includes both movable property acquired by a female Hindu by inheritance or devise, or at a partition, or in lieu of maintenance or arrears of maintenance, or by gift from any person, whether a relative or not, before, at or after her marriage, or by her own skill or exertion, or by purchase or by prescription, or in any other manner whatsoever, and also by such property held by her as stridhana immediately before the commencement of this Act. (2) Nothing contained in sub section (1) shall apply to any property acquired by way of gift or under a will or any other instrument or under a decree or order of a civil court or under an award where the terms of the gift, will or other instrument or the decree, order or award prescribe a restricted estate in such property. " Section 15 provides: "115 (1) The property of a female Hindu dying intestate shall devolve according to the rules set out in section 16, (a) firstly, upon the sons and daughters (including the children of any predeceased son or daughter) and the husband; (b) secondly, upon the heirs of the husband; (c) thirdly ' upon the mother and father; 432 (d) fourthly, upon the heirs of the father; (e) lastly, upon, the heirs of the mother; (2) Notwithstanding anything contained in sub section (1), (a) any property inherited by a female Hindu from her father or mother shall devolve, in the absence of any son or daughter of the deceased (including the children of any predeceased son or daughter) not upon the other heirs referred to in sub section (1) in the order specified therein but upon the heirs of the father: and (b) any property inherited by a female Hindu from her husband or from her father in law shall devolve, in the absence of any son or daughter of the deceased (including the children of any predeceased son or daughter) not upon the other heirs referred to in sub section (1) in the order specified therein, but upon the heirs of the husband." Section 16 which prescribes the order of succession and manner of distribution among, the heirs of a Hindu female provides by Rule ,,Among the heirs specified in sub section (1) of section 15, those in one entry shall be preferred to those in any succeeding entry, and those included in the same entry shall take simultaneously." 433 Counsel for Rajkumar concedes, and in our judgment he is right in so conceding that if the share declared by the preliminary decree in favour of Khilonabai is property possessed by her at the date of her death, it should devolve upon her grandsons Munnalal and Ramchand, to the exclusion of Rajkumar adopted son of Padam Chand. This Court in Gumalapara Taggina Matada Kotturuswami vs Setra Veeravva (1) held that "The word "possessed" in section 14 is used in a broad sense and in the context means the state of owning or having in one 's power". The preliminary decree declared that Khilonabai was entitled to a share in the family 'estate and the estate being with the family of which she was a member and in joint enjoyment, would be possessed by her. But counsel for Rajkumar submitted that under the preliminary decree passed in the suit for partition the interest of Khilonabai in the estate was merely inchoate, for she had a mere right to be maintained out of the estate and that her right continued to retain that character till actual division was made and the share declared by the preliminary decree was separated to her: on her death before actual division the inchoate interest again reverted to the estate out of which it was carved. Counsel relied upon the judgment of the judicial committee in Pratpamull Agarwalla vs Dhanabati Bibi (2) in support of his plea that under the Mitakshara law, when the family estate is divided a wife or mother is entitled to a share. but is not recognised as the owner of such share until the division of the, property is actually made,as she has no preexisting right in the estate except a right of maintenance. Counsel submitted that this rule of Hindu law was not affected by anything contained in section 14 of the . By section 14 (1) the Legislature sought to convert the interest of a Hindu female which under the (1) [1959] 1 Supp. S.C.R. 968. (2) (1935) L.R. 63 I.A 33. 434 Sastric Hindu law would have been regarded as a limited interest into an absolute interest and by the explanation thereto gave to the expression property" the widest connotation. The expression includes property acquired by a Hindu female by inheritance or devise, or at a partition, or in lieu of maintenance or arrears of maintenance, or by gift from any person, whether a relative or not, before at or after her marriage, or by her own skill or exertion, or by purchase or by prescription, or in any other manner whatsoever. By section 14(1) manifestly it is intended to convert the interest which a Hindu female has in property however restricted the nature of that interest under the Sastric Hindu law may be into absolute estate. Pratap mull 's case undoubtedly laid down that till actual division of the share declared in her favour by a preliminary decree for partition of the joint family estate a Hindu wife or mother, was not recognized as owner, but that rule cannot in our judgment apply after the enactment of the . The Act is a codifying enactment, and has made far reaching changes in the structure of the Hindu law of inheritance, and succession. The Act confers upon Hindu females full rights of inheritance, and sweeps away the traditional limitations on her powers of dispositions which were regarded under the Hindu law as inherent in her estate. She it; under the Act regarded as a fresh stock of descent in respect of property possessed by her at the time of her death. It is true that under the Sastric Hindu, law, the share given to a Hindu widow on partition between her sons or her grandsons was in lieu of her right to maintenance. She was not entitled to claim partition. But the Legislature by enacting the Hindu Women 's ' Right to Property Act, 1937 made a significant departure in that branch of the law: the Act gave a Hindu widow the same interest in the property 435 which her husband had at the time of his death, and if the estate was partitioned she became owner in severally of her share, subject of course, to the restrictions on disposition and the peculiar rule of extinction of the estate on death actual or civil. It cannot be amused having regard to this development that in enacting 8. 14 of the , the Legislature merely intended to declare the rule enunciated by the Privy Council in Pratapmulls case. Section 4 of the Act gives an overriding effect to the provisions of the Act. It enacts"Save as otherwise expressly provided in this Act, (a) any text rule or interpretation of Hindi law or any custom or usage as part of that law in force immediately before the commencement of this Act shall cease to have ;effect with respect to 'any matter for which provision is made in this Act : (b) x x x x X" Manifestly, the legislature intended to supersede the rules of Hindu law on all matters in respect of which there was an express provision made in the Act. Normally a rights declared in an estate by a preliminary decree would be regarded as property, and there is nothing in the context in which section 14 occurs or in the phraseology used by the Legislature to warrant the view that such a right declared in relation to the estate of a joint family in favour of a Hindu widow is not property within the meaning of section 14. In the light of the scheme of the Act and its avowed purpose it. would be difficult, without doing violence to the language used in the enactment, to assume that a right declared in property in favour of a person under a decree for partition is not a right to property. , If under a preliminary decree the right in favour of a Hindu male be regarded as property the right declared in favour of a Hindu female must also be regarded 436 as property. The High Court was therefore, in our judgment, in error in holding that the right declared in favour of Khilonabai was not possessed by her, nor are we able to agree with the submission of the learned counsel for Raj Kumar that it was not property within the meaning of section 14 of the Act. On that view of the case, by virtue of so. 15 and 16 of the Act, the interest declared in favour of Khilonabai devolved upon her sons Munnalal and Ramohand to the exclusion of her grandson Rajkumar. The decree passed by the High Court is therefore modified in this respect and the decree passed by the trial Court restored. Having regard to the partial success of the parties, there will be no order as to costs in this appeal and in the High Court.

G, a Digamber Jain of the, Porwal sect, died in 1934 leaving behind his widow Smt. K, his son G who died in 1939 and three grandsons M, P and R. In 1952 M 's son S filed a suit for partition of the joint family properties. Rajkumar, claiming to be a son of P adopted by his widow, claimed a 1/4th share in the joint family property. The adoption was challenged on the ground that no express authority had been given by P to his widow to adopt. The trial court held that no express authority was required by a sinless Jain widow to adopt a son and that the adoption was duly and properly made. Accordingly, a preliminary decree declaring the shares of Smt. K, the branch of M, the branch of R and of Rajkumar to be 1/4th each was passed. M and others pre ferred an appeal to the High Court mainly against the findings on the question of adoption. During the pendency of the appeal, the , came into force. Shortly thereafter Smt. K died. The High Court upheld '.he decision of the trial court on the question of the adoption of Rajkumar. With respect to the share of Smt. K the High Court held that her interest declared by the preliminary decree was inchoate, that she never became "possessed", 419 of any share within the meaning of s 14 of the Act and that it remained joint family property which became divisible amongst the parties proportionately to their shares. The appellants contended that the adoption of Rajkumar was invalid as no custom applicable to the Porwal sect of the jains had been established empowering a widow to adopt without the authority of her husband and that the 1/4th share of Smt. K declared by the preliminary decree had become her absolute property by virtue of section 14 of the Act and upon her death it descended to her grandsons M and R to the exclusion of other parties. Held, that the adoption of Rajkumar was valid. A sonless Jain widow could adopt a son without the express authority of her husband. Such a custom among the Jains not domiciled in the States of Madras and the Punjab) has been recognised by judicial decisions spread over a period longer than a century. Though none of these decisions related to the Porwal sect of Jabalpur to which the parties belonged. They laid down a general custom of the jains which were applicable to the parties. The decisions proceeded not upon. any custom peculiar to any locality or to any sect of the jains but. upon general custom which had by long acceptance become part of the law applicable to them. Where a custom is repeatedly brought to the notice of the Courts, the courts may held that custom introduced into the law without the necessity of proof in each individual case. Pemraj vs Mst. Chand Kanwar, (1947) L. R. 74 1. A. 224 and Mangibai Gulabchand vs Suganchand Bhikamchand, A.I.R. (1948) P. C. 177, relied on. Sheokuarbai vs Jeoraj, , Saraswathi Ammal vs ,Jagadambal, , Maharajah Govind nath Ray vs Gulal Chand, (1833) 5 Sel. Rep. 276, Bhagwandas Tejmal vs Rajmal Alias Hiralal Lachmindas, (1873) 10 Bom. H.C. Rep. 241, Sheo Singh Rai vs Mst. Dakho and Morari Lal (1878) L.R. 5 1. A. 87, Lakhmi Chand vs Gatto Bai, All. 319, Manik Cha nd Golecha vs Jagit Settani, Cal. 518, Harar nabh Parshad alias Rajajee vs Mangil Das, Cal. 379, ManoharLal vs Banarsi Das All. 495, Asharfi Kumar vs Rupchand, All. 197, Rup Chand vs Jambu, Prasad All, 2 47, Jiwaraj vs Mst. Sheokuwarbai, A.I.R. (1920) Nag. 162, Banarsi Das vs Sumat Prasad, All. 1019 and Rama Rao vs Raja of Pittapur, (1918) L. R. 43 1. A. 148, referred to. Held, further that the 1/4th share of Smt. K declared by the preliminury decree was "possessed" by her and on her 420 death it descended to her grandsons in accordance with provisions of sections 15 and 16 of the Act. The word "possessed" in section 14 was used in a broad sense meaning the state of owing or having in one 's power. The rule laid down by the Privy Council that till actual division of the share declared in her favour by a preliminary decree for partition of the,joint family prop" a Hindu wife or mother was not recognised as owner of that share cannot apply after the enactment of the . Section 4 of the Act made it clear that the Legislature intended to supersede the rules of Hindu law on all rs in respect of which there was an express provision made in the Act. Gumalapura Taggina Matada Kotturuswami vs Setra Veerayya, (1959) 1 Supp. S.C.R. 968 and Pratapmull Agarwalla vs Dhanabati Bibi, (1935) L.R. 63 I.A. 33, referred to.

Appeal No. 188 of 1961. Appeal by special leave from the judgment and order dated September 11,1959, of the Industrial Tribunal, Punjab, Patiala in Reference No. 30 of 1957. G.S. Pathak, J. B. Dadachanji, O. C. Mathur and Ravinder Narain, for the appellants. Bawa Shivcharan Singh and Janardan Slwrma for the respondents. February 8. The Judgment of the Court was delivered by VENKITARAMA AIYAR, J. This is an appeal by special leave against the Order of the Industrial Tribunal, Punjab, dated September 11, 1959, in Reference No. 30 of 1957, overruling certain preliminary objections raised by the appellant to the 91 jurisdiction of the Tribunal to hear the reference. The facts are that on February 14,,1955, the Government of Punjab referred under section 10(1)(c) of the , hereinafter referred to as "the Act", certain disputes between the appellant and the respondents to the Industrial Tribunal Punjab, Jullundur, for adjudication. ' That was numbered as Reference No. 3 of 1955. This Tribunal had been constituted on August 29, 1953, by a Notification issued by the Government of Punjab, which is as follows "In exercise of the powers conferred under section 7 of the (Act XIV of 1947), the Governor of Punjab, in consultation with the Punjab High Court, is pleased to appoint Shri Avtar Narain Gujral 'Advocate, as Industrial Tribunal 'for Punjab. " The main contention pressed before us on %behalf of the appellant is that Shri A.N. Gujral was 'not qualified under section 7(3)(c) of the Act under which the Notification was issued to be appointed as Tribunal on August 29, 1953, as he was very sixty years of age on that date, having been born on June 4, 1 892, and that there was therefore no Tribunal validly constituted in existence, and that in consequence the reference, to that so called Tribunal on February 14, 55, was wholly inoperative. While Reference No. 3 of 1955 was pending before the Tribunal, the provisions of the , were amended by the Industrial Dispute (Amendment and Miscellaneous Provisions) Act, 1956 (Act No. 36 of 1956), which came into force on March 10, 1957. This Amendment Act repealed section 7 of the principal Act, and replace it by sections 7A, 7B and 7C. Section 30 of the Amendment Act contains a saving as regards proceedings in relation to any industrial dispute which had been pending before a Tribunal constituted under the principal Act. Acting under this section, the 92 Punjab Government issued on April 19, 1957, the following Notification : "No. 4194 0. Lab 57/652 RA In continuation of Punjab Government Memorandum No. 3078 C Lab 57/4224, dated the 1st/llth March, 1957, and in exercise of the powers conferred by section 7 of the , as in force before the commencement of the Industrial Disputes (Amendment and Miscellaneous Provisions) Act, 1956, read with Section 30 of the latter Act and all other powers enabling him in this behalf the Governor of Punjab is pleased to extend (a)the period for which the Industrial Tribunal, Punjab, Jullundur, is constituted, and (b)the term of appointment of the Role Member thereof. up to the last day of October, 1957, or such date as the proceedings in relation to industrial disputes pending in the said Tribunal immediately before the 10th March, 1957, are disposed of, whichever is earlier." To put it briefly, this Notification extended the life of the Tribunal constituted under the repealed section 7, for the period specified therein, and it also continued the term of Shri A,N. Gujral, as a Member thereof, for the said period. The contention of the appellant with reference to this Notification is that section 30 of Act 36 of 1956 does not authorise the appointment of a Member to the Tribunal constituted under section 7, and that the Notification in so far as it continued Sbri A.N. Gujral. as a Member of the Tribunal after his term of office had expired on Mach 10, 1957, was unauthorised and void. 93 On the same date on which the above Notification was issued, that is on April 19, 1957, the Government of Punjab issued a Notification under section 7A of the Act of which the relevant portion is as follows : "No. 4194 C Lab 57/66t RA In exercise of the powers conferred by Section 7A of the Industrial Disputes Act, 1917, as inserted by section 4 of the Industrial Disputes (Amendment and Miscellaneous Provisions) Act , 1956, (No. 36 of 1956), and all other powers enabling him in this behalf, the Governor of Punjab is pleased to constitute an Industrial Tribunal with Headquarters at Jullundur and to appoint Shri Avtar Narain Gujral, B.A., LL.B., as its Presiding Officer with effect from the date of the publication of this notification in the Official Gazette up to 3rd June, 1957. " It will be noticed that this Notification firstly constituted a now Tribunal being the Industrial Tribunal, Jullundur, and secondly it appointed Shri A. N. Gujral as its Presiding Officer 'up to June 3, 1957. The significance of that date is that, under section 7C (b) enacted by the Amendment Act, 1956, the age of retirement for members was fixed at sixty five, and under that provision, Shri A.N. Gujral would have to retire on June 3, 1957. The Punjab Legislature intervened at this stage and enacted two statutes which are material for the present dispute. One of them was the Industrial Disputes (Punjab Amendment) Act 8 of. Section 3 of this Act amended section 7C (b) of the principal Act by substituting for the words "he has attained the age of sixty five years", the words "he has attained the the age of sixty seven years". Thus the age of retirement was raised to sixty seven years. By the operation of this Act, the tenure of Shri A. N. Gujral could be extended from 94 June 3, 1957 to June 3, 1959, and that in fact was done by a number of Notifications issued from time to time. The appellant contends that this legislation was intended to benefit a single individual Shri A.N. Gujral, and is therefore void as offending article 14 of the Constitution. The result, according to the appellant, is that after June 3, 1957, there was no one validly holding the office of Member of the Industrial Tribunal. The second statute enacted by the Punjab Government is the Industrial Disputes (Amendment and Miscellaneous Provisions) (Punjab Amendment) Act 9 of 1957. It introduced in section 30 of the Amendment Act, 1956, a new sub section (2) conferring on the ,State Government authority to re constitute Tribunal established under the , where those Tribunals had come to an end and there were matters pending before them for adjudication. Going back to the Tribunal which was constituted under the repealed section 7 of the Act it will be remembered that a Notification had been issued on April 19, 1957, under section 30 of the Amendment Act, 1956, keeping it alive until the pending matters were dis posed of or until October 31, 1957, whichever was earlier. The expectation that the proceedings before that Tribunal would be completed by that date was however, not realised and therefore acting under section, 33B (1) of the Act, and section 30 of the Amendment Act 1956, as further amended by Punjab Act, 9 of 1957. the Government of Punjab issued on October 31, 1957 a Notification transferring the matters pending before the old Tribunal constituted under section 7 to the new Tribunal constituted on April 19, 1957, under section 7A. In accordance with this Notification, Reference No. 3 of 1955 was transferred to the new Tribunal and was renumbered as 30 of 1957. The contentions urged by the appellant against this order of transfer are, firstly, that the Tribunal to which the transfer had been made was not, for the reasons already given, validly constituted and had no legal existence, and, 95 secondly, that the new provision introduced by the Punjab Act 9 of 1957 has no retrospective operation and that, in consequence, the proceedings which had been pending before the old Tribunal on March 10, 1957, could not be transferred to the new Tribunal under this section. The present reference 30 of 1957 was pending till June 3, 1959, when Sbri A.N. Gujral retired. The Punjab Government then issued a Notification appointing Sri Kesho Ram Passey, retired Judge of the Punjab High Court as the Presiding Officer of the Industrial Tribunal, Jullundur. Before him, the present appellant filed an application on September 4, 1959, raising a number of preliminary objections to the hearing of the reference. By its Order dated September 11, 1959, the Tribunal overruled these objections and posted the. matter for hearing on the merits. It is the correctness of this Order that is DOW challenged before us in this Appeal. Though a number of objections were raised to the bearing of the rieference be,.fore the Tribunal, the contentions advanced before us for the appellant are the following : (1) Shri A. N. Gujral was riot qualified to be appointedto the Tribunal under section 7(3)(c) of the Act that, in consequence, the reference to him dated February 14, 1955, was incompetent; (2)that the Notification. of the Punjab Government dated April 19, 1957 appointing Shri A. N. Gujral as a Member of the Industrial Tribunal, Juilundur, and the subsequent Notifications extending bis tenures of office are unauthorised and inoperative; (3)that the Notification of the Punjab Government dated Ootober 31, 1957, transferring the proccedings. pending before the old Tribunal to the new Tribunal was inoperative, because (i) the Punjab Act 8 of 1957 is void being repugnant to article 14 of the, Constitution and the appointment of Shri A. N. Gujral as Member under that Act is also void; 96 and (ii) section 30(2) enacted by Punjab Act 9 of 1957 under which the transfer was made, did not authorise transfer of proceedings, which had been pending on or before March 10, 1957. (1) Taking up first the, contention that Shri A. N. Gujral was not qualified to be appointed to the Tribunal on August 29, 1953, by reason of the fact that he was over sixty years of age, the question is one of interpretation of the language of section 7(3)(c) of the Act. Section 7, in so far As it is material for the present purpose, is as follows: "7. Industrial Tribunals. (1) The appropriate Government may constitute, one or more Industrial Tribunals for the, adjudication o f industrial disputes in accordance with the provisions of this Act. (2)A Tribunal shall consist of such number of independent members as the appropriate Government may think fit to appoint,, and where the Tribunal consists of two or more members, one of them shall be appointed as the Chairman thereof. (3)Where a Tribunal consists of one member only, that member, and where it consists of two or more members, the Chairman of the Tribunal, shall be a person who (a)is or has been a Judge of a High Court; or (b) is or has been a District Judge or (c) is qualified for appointment as a Judge of a High Court: Provided that no appointment under this subsection to a Tribunal shall be made of any person Dot qualified under clause (a) or (b) except with the approval of the High Court of 97 the State in which the Tribunal has, or is intended to have its usual seat." Shri A. N. Gujral was appointed under section 7(3)(c) being an Advocate. The question is, whether he was then qualified for appointment as a Judge of a High Court under that clause. The Constitutional provision hearing on this point is article 217, which in so far as it is material is as follows : "217. (1) Every Judge of a High Court shall be appointed by the President by warrant under his hand and seal after consultation with the Chief Justice of India, the Governor of the State, and, in the case of appointment of a Judge other than the Chief Justice, the Chief Justice of the High Court, and shall hold office in the case of an additional or acting Judge, as provided in article 224, and in any other case until he attains the age of sixty years; Provided that. . . (2)A person shall not be qualified for appointment as a Judge of a High Court unless he is citizen of India and (a) has for at least ten years held an Judicialoffice in the territory of India, or (b) has for at least ten years been a advocate of a High Court or of two or more such Courts in succession. Explanation. . While article 217 (2) prescribes the qualifications for appointment as a Judge, article 217(1) lays down that the Judge shall hold office until he attains the age of sixty years. The whole of the controversy before us is as to the inter relation between these two clauses. The contention of Mr. Pathak, learned counsel for the appellant, is that though article 217 (1) refers, in terms, to the termination of the office of Judge, in substance, it lays down a 98 qualification for appointment, because the appointment of a person over sixty as a Judge would clearly be repugnant to article 217(1) even though he might satisfy all the requirements of article 217(2). It is accordingly argued that it is an implied qualification for appointment as a Judge under article 217 that the person should not have attained the age of sixty at the time of the appointment. We agree that there is implicit in article 217(1) a prohibition against appointment as a Judge of a person who has attained the age of sixty years. But in our view, that is in the nature of a condition governing the appointment to the office not a qualification with reference to a person who is to be appointed thereto. There is manifest on the terms and on the scheme of the article a clear distinction between requirements as to the age of a person who could be appointed as a Judge and his fitness based on experience and ability to fill the office. article 217(1) deals with the former, and, in form, it has reference to the termination of the office and can therefore be properly read only as imposing, by implication a restriction on making the appointment. In strong contrast to this is article 217(2) which expressly refers to the qualifications of the person to be appointed such as his having held a judicial post or having been an Advocate for a period of not less than ten years. We think that on a true construction of the article the prescription as to age is a condition attached to the duration of the office and not a qualification for appointment to it. Mr. Pathak also relied on articles 224 and 376 as lending support to his contention that age is to be regarded as an implied qualification under article 217. article 224 relates to the appointment of additional and acting Judges and it is provided in els. (1) and (2) that the person to be appointed as additional or acting Judge by the President should be a duly qualified person. There is nothing about the age of the person to be appointed in these clauses. 99 That is provided in article 224(3) when enacts that no person appointed as an additional or acting Judge of a High Court shall hold office after attaining the age of sixty years. " This article is also framed on the same lines as article 217 and does not carry the matter further. Nor is there anything in article 376 which throws any further light on this point. It has reference to persons who were Judges in the High Courts of the States specified in part of the First Schedule at the time when the Constitution came into force, and provides that they shall become Judges of the High Courts in those States under the Constitution, and then enacts a special provision that they "shall notwithstanding anything in clauses (1) and (2) of article 217 but subject to the proviso to clause (1) of, that article, continue to hold office until the expiration of such period as the President may by order determine. " We see nothing in the terms of this article which lends any support to the contention that age is to be regarded as a qualification. More to the point under consideration is article 165 (1) that the ",Governor of each State shall appoint a person who is qualified to be appointed as a Judge of a High Court to be Advocate General for the State. " The question has been discussed whether on the terms of this article" a person who has attained the age of sixty could be appointed as an Advocate General. If the age of a person is to be regarded as one of his qualifications, then he could not be. The point arose for decision in G. D. Karkare vs T. L. Shevde (1), where a Judge who had retired at the age of sixty had been appointed as Advocate General. The validity of the appointment was challenged on the ground that he was disqualified by reason of his age. The learned Judges of the Nagpur High Court held that cl. (1) of article 217 of the Constitution prescribed only the duration of the appointment of a Judge of the High Court and could not be construed (1) I. L.R. [1952] Nas. 409. 100 as prescribing a qualification for his appointment. It is argued for the appellant that the appointment of an Advocate General under article 165 might stand on a different footing from that of a Judge under article 217. because of the special provision in article 165(3) that the Advocate General is to hold office, at pleasure, whereas a Judge holds office during good behavior. But this difference bears only on the power of the appropriate authority to terminate the appointment and not on the qualification of the person to be appointed to the office. In our view, the interpretation put upon article 217 in G. D. Karkare 's case (1) is correct. Though the true meaning of article 217 has figured largely in the argument before us, it is to be noted that we are primarily concerned in this appeal with the interpretation of section 7(3)(c) of the Act, and that must ultimately turn on its own context. Section 7(3)(a) provides for the appoint ment of a High Court Judge, sitting or retired, as a Member of the Tribunal. Age is clearly not a qualification under this sub clause, as the age for retirement for a Judge of the High Court is sixty. Likewise, el. (b) provides for the appointment of a District Judge, setting or retired, as a Member. A retired District Judge who is aged over sixty will be eligible for appointment under this subclause. Thus the age of a person does not enter into his qualifications under sub cls. (a) and (b). It would therefore be legitimate to construe sub el. (c) as not importing any qualification on the ground of age. But it is said that sub cls. (a) and (b) form a distinct group having reference to judicial officers, whereas, cl. (c) is confined to Advocates, who form a distinct category by themselves, and that in view of this difference, considerations as to age applicable to cl. (a) and (b) need not be applicable to el. There is undoubtedly a distinction (1) I. L. R.[1952] Nag. 409. 101 between cls. (a) and (b) on the one hand and c1. (c) on the other. But the question is whether this has any reasonable relation to the difference which is sought to be made between the two classes with reference to the age of appointment. If a retired Judge of the age of sixty can fittingly fill the office of a Member of the Tribunal under section 7, an Advocate of that age can likewise do so. In our view, there is no ground for importing in section 7(3)(c) an implied qualification as to age, which is not applicable to el. 7(3)(a) and (b). This question was considered by a Bench of the Punjab High Court in Prabhudayal vs State of Punjab (1). There the validity of the appointment of Shri A. N. Gujral under the notification dated August 29, 1953, which is the very point now under debate, was challenged on the ground that as he was over sixty on that date, he was not qualified to be appointed under section 1 (3)(c). The Court held approving of the decision in G. D. Karkare 's case (2), that the prescription as to age in article 217 (1) was not a qualification to the office of a Judge under article 217(2), and that a person who was more than sixty was qualified for appointment under section 7(3)(c). Reliance is placed for the appellant on the terms of section 7C which was substituted by the Amendment Act 36 of 1956 in the place of section 7 as supporting the contention that age is a qualification for appointment under section 7(3) (c). Section 7C is as follows : "No person shall be appointed to, or continue in, the office of the presiding officer of a Labour Court, Tribunal or National Tribunal, if (a) he is not an independent pet son or (1) A. 1. R (2) 1.1 R.[1952] Nag. 409. 102 (b) he has attained the age of sixty five years ' " The marginal note to that section which was also relied on is as follows : " Disqualifications for the presiding officers of Labour Courts, Tribunals and National Tribunals. " The argument of the appellant is that, in prescribing the age as a qualification under section 7C, the Legislature only made explicit what was implicit in a. 7(3)(c), and that therefore the qualification on the basis of age should also be imported in section 7(3)(c). This inference does not, in our opinion, follow. The insertion of age qualification in section 7C is more consistent with an intention on the part of the Legislature to add, in the light of the working of the repealed section 7, a new provision prescribing the age of retirement for Members. We agree with the decision of the Punjab High Court in Prabhudayals case (1) and hold that section 7 (3) (c) does not import any qualification based on the age of the person to be appointed, and that the appointment of Shri A. N. Gujral on August 29, 1953, was valid under a. 7(3)(c). (2)The next contention advanced for the appellant is that the Notification dated April 19, 1957, appointing Shri A. N. Gujral as a Member of the Tribunal issued under section 30 of the Amendment Act 36 of 1956 was not authorised by the terms of that section and that therefore there was no validly constituted Tribunal from that date. Section 30 is as follows : "Savings as to proceedings pending before Tribunals : If immediately before the commencement of this Act there is pending any proceeding in relation to an Industrial dispute before a Tribunal constituted (1) A. I. R. [1959] Punj 460. 103 under the (14 of 1947), as in force before such commencement, the dispute may be adjudicated and the proceeding disposed of by that Tribunal after such commencement, as if this Act had not been passed. " The contention urged before us is that section 7 under ,Which Shri A. N. Gujral had been constituted Tribunal was repealed on March 10, 1957, the notification dated April 19, 1957, appointing him as a Member of the Tribunal is void. There is no substance in this contention. Section 30 expressly provides for the life of the Tribunal being extended for the period specified therein, and that necessarily implies a power to continue Shri A. N. Gujral as the Tribunal, and we should add that in view of our decision on point No. 3 this objection is practically of no importance. (3)Lastly, it is contended that the transfer of the proceedings pending before the old Tribunal to the new Tribunal under the Notification dated October 31, 1957, was invalid and inoperative. Two grounds were urged in support of this contention. One is that Shri A.N. Gujral attained the age of sixty five on June 4, 1957, and his term of office would have then expired under s.7C. Then the Punjab Legislature enacted Act 8 of 1957 raising the age of retirement under s.70(b) from sixty five to sixty seven. That was with a, view to continue Shri A.N. Gujral in office. And this legislation came into force only on June 3, 1957. This Act, it is said offends article 14 as its object was to benefit a particular individual, Shri A.N. Gujral, and reference was made to a decision of this Court in Ameeroonissa vs Mehboob (1) as supporting this contention. There is no force in this contention. There the legislation related to the estate of one (1) ; 104 Nawab Waliuddoula, and it provided that the claims of Mahboob Begum and Kadiran Begum, who claimed as heirs stood dismissed thereby and could not be called in question in any court of law. And this Court held that it was repugnant to article 14, as it singled out individuals and denied them the right which other citizens have of resort to a court of law. But the impugned Act, 8 of 1957 is of general application, the age being raised to sixty seven with reference to all persons holding the office under that section. The occasion which inspired the enactment of the statute might be the impending retirement of Shri A. N. Gujral. But that is not a ground for holding that it is discriminatory and contravenes article 14, when it is, on its terms, of general application. The second ground of attack against the order of transfer is that it is not competent under s.30(2) of the Amendment Act 36 of 1956 as further amended by the Punjab Act 9 of 1957. Section 30(2) is as follows : "If immediately before the commencement of this Act there was pending any proceeding in relation to an industrial dispute before a Tribunal constituted under the , as in force before such commencement and such proceeding could riot be disposed of by that Tribunal due to the Tribunal having come to an end on the expiry of the period for which it was constituted, the State Government may reconstitute that Tribunal for adjudicating that dispute and disposing of that proceeding after such commencement as if this Act had not bee n passed, and the proceeding may be continued by that Tribunal from the, stage at which it was left. " 105 The contention urged before us is that this provision has no retrospective operation and that in consequence the proceedings which had been pending before the old Tribunal on March 10, 1957, could not be transferred to the new Tribunal under this section. This contention is clearly untenable, because the whole object of s.30(2) is to provide for the hearing of disputes which were pending before the old Tribunal, and its operation is entirely retrospective. This contention must there. fore be rejected. In the result, the repeal fails and is dismissed with costs. Appeal dismissed.

On February 14, 1953, the Government of Punjab referred certain disputes between the appellant company and its workmen to the Industrial Tribunal which had been consti tuted on August 29, 1953, by a notification issued under section 7 of the industrial Disputes Act, 1947, by which G, an Advo cate, was appointed as the Industrial Tribunal for Punjab. When the reference was pending the Act was amended. The Amendment Act inter alia repealed section 7 of the principal Act and replaced it by sections 7A, 7B and 7C, and by section 30 provided for a saving clause in respect of the proceedings pending before the Tribunal constituted under the principal Act. On April 19, 1957, the Punjab Government issued a notification under section 7 of the Act and section 30 of the Amendment Act extending the life of the Tribunal constituted under the repealed section 7 and also extending the term of G as the member. On the same date another Notification was issued under section 7A of the Act constituting a new Tribunal and appointing G as the Presiding Officer up to June 3, 1957. Under section 70 (b) the age of retirement for members was fixed at sixty five and under that provision G would have to retire by June 3, 1957. The Punjab Government intervened and passed the Industrial Disputes (Punjab Amendment) Act, 1957, raising the age of retirement of members to sixty seven years. After G had retired on June 3, 1959, the Punjab Government issued a notification appointing another person as the Presiding Officer of the Industrial Tribunal. The appellant challenged the legality of the reference on the grounds, inter alia, (1) that G was not qualified to be appointed to the Tribunal under section 7 (3) (c) of the Act, as he was over sixty years and, therefore, the reference to him dated 90 February 14, 1955, was incompetent, and (2) that the Indus trial Disputes (Punjab Amendment) Act, 1937, was passed with a view to benefit a single individual, G, and, therefore, was void as offending article 14 of the Constitution of India. Held, (1) section 7(3)(c) of the , did not import any qualification based on the age of the person to be appointed, and that the appointment of G on August 29, 1953, was valid under that section. On the true Construction of article 217 of the Constitution of India, the prescription of age therein is a condition attached to the duration of the office and not a "qualifica tion" for appointment to it. G.D. Karkare vs T.L. Shevde, I.L.R. and Prabhudayal vs State of Punjab, A. I. R. 1959 Punj. 460, approved. (2) the Industrial Disputes (Punjab Amendment) Act,1957,not contravene article 14 of the Constitution, because thoughthe occasion which inspired the enactment of the statutemight be to benefit an individual, it was of general application and could not therefore be held to be discriminatory. Ameerunissa vs Mehboob; , , distinguished.

Appeals Nos. 4 and 5 of 1962. Appeals by special leave from the award dated January 25, 1960, of the Industrial Tribunal, Delhi in I.D. No. 40 of 1957. A.V. Viswanatha Sastri, A. N. Sinha, and section Venkatakri,shnan for the appellant (in C.A. No. 4 of 62) and the respondent (in C.A. No. 5 of 1962). 518 A.S. B. Chari. R. K. Garg, D. P. Singh, section C. Agarwala and M.K. , Ramamurthi for the respondents (in C.A. No. 4 of 62) and the appellants (in C.A. No. 5 of 62). March 1. The Judgment of the Court was delivered by WANCHOO, J. These two appeals by special leave arise out of the same award of the Industrial Tribunal, Delhi, and will be dealt with together. Appeal No. 4 is by the management of the D.C.M. Chemical Works while appeal No. 5 is by the workmen. The management hereinafter will be referred to as the appellant for the purposes of both appeals and the workmen will be referred to as respondents. A dispute arose between the parties with respect to various matters including wage scales, dearness allowance and gratuity. As the parties could not come to terms it was referred to the industrial tribunal for adjudication and there were as many as eleven issues which were the subject matter of reference. The main point however on which the parties differed was whether in determining the wage structure etc. of the chemical works which is a constituent unit of the Delhi Cloth and General Mills Limited (hereinafter called the Company), the over all position of the Company should be taken into account or only the position of this one unit, namely, the chemical works. The respondents contended that the chemical works was an integral part of the Company and therefore the over all position of the Company should be taken into account and the wage structure etc. fixed accordingly; in particular it was pointed out that there were differences in wage structure etc. between the various units which were controlled and owned by the Company and which were all situate in the same area in Delhi and that those differences should be eliminated and all the enterprises in Delhi controlled by the Company should be treated on the same footing. On the other band the contention of the 519 appellant was that though the chemical works was one unit of a large number of industries controlled by the Company, some of which were situate in the same area in Delhi, the various units were independent industries and each unit had to be considered on its own, and the wage structure etc. fixed on the basis of the financial position of each unit ;in particular, it was urged that two of the main units in Delhi were the textile mills run by the Company and the claim of the respondents that the chemical works should in all matters be treated on a par with the textile units was untenable, on the ground, among others, that it would be against the principle of industry cum region. Before there fore we take up the particular matters raised in the two appeals before us, we shall first have to consider whether the claim of the respondents that the overall position of the Company should be taken into account in fixing the wage structure etc. of the chemical works is sound ; for if that position is accepted, the award may have to be set aside as the tribunal has held that in the circumstances of this case the chemical works should be treated as an independent unit and that the wage structure etc. therein cannot be fixed on the basis of the over all position of the Company. In order to appreciate the various contentions put forward by the parties on this question it may be useful to look into the history of the Company and how it has grown. The Company came into existence in 1889 with a modest capital of about Rs. 10 lacs. It seems that the policy of those in control of the Company was to slough back a substantial part of the profits into the industry itself and to create a reserve for that purpose. Originally the Company started with a textile mill but in course of time with the help of sloughed back profits and also with the aid of further capital, the Com. pany set up a large number of other industrial 520 concerns in Delhi and elsewhere. In Delhi itself, the Company now has the Delhi Cloth Mills, the Swatantra Bharat Mills which are both textile concerns, the D.C.M. Tent Factory established in 1940, and the chemical works with which we are concerned in the present appeals. Besides, there are other industrial concerns owned and controlled by the Company outside Delhi, as for example, the Daurala Sugar Works established in 1932, the Lyallpur Cotton Mills in ' 1934 and the Mawans Sugar Works in 1940. The chemical works were started in 1942 and the only line of production at that time was sulphuric acid. In 1943, an alum plant was set up, in 1944 a soap plant, in 1945 a superphosphate plant and in 1946 a contact sulphuric acid plant. In 1. 947 a vanaspati plant was established and also a power house was erected in order to meet the requirements of the vanaspati plant. In 1948 49 a caustic soda plant was added so that what began as modest subsidiary to the textile mills has now expanded into a full fledged unit for production of chemicals and vanaspati. The total capital which was originally about Rs. 10 lacs when the Company started in 1889 has now grown to Rs. 4 crores. so the capital employed in the chemical works has always been found from the reserves of the Company and is now of the order of over a crore. It is also not in dispute that very little out of the production of the chemical works is used in the textile mills of the Company and that by far most of the production is sold in the open market. Further even the small part of the production that is used by other units is charged at market rates and not at cost price, so that for all practical purposes the chemical works is being run as an independent unit. Certain features have however been pointed out by the respondents to show that the over all 521 position of the Company should be taken into account in determining the wage structure etc. of the chemical works which should be treated as an integral part of the entire industry of all kinds carried on by the Company. These features are : no unit has any separate paid up capital and there is no separate depreciation fund or reserve fund for each unit ; the Company publishes one balance sheet showing the total profits of all the undertakings after taking into account losses incurred in any undertaking ; the shareholders of the Company are the shareholders in all the unit,% ; the Company has got one board of directors and a common managing agency and the policy of the various units is determine on the basis of the Company as one integrated unit; the profits of the Company are all pooled together and the profits in any undertaking are not earmarked for expenditure in that undertaking; the dividends are paid from to profits of the Company as a whole; the Company has a single provident fund for all its employees in all its units and the Company has established various units from the profits earned by the Company as a whole in the past and incometax is paid on the entire profits of the Company made by all the units after taking into account the losses, if any, incurred by a particular unit. It is urged therefore on behalf of the respondents that these features are sufficient to establish that all the different industries carried on by the Company are one integrated whole and therefore in fixing the wage structure etc. for the chemical works this overall position should be taken into account. There is however in our opinion a 'very cogent reply to these features pointed out on behalf of the respondents, and that is that the Company is a single limited concern owning and controlling various industrial units of different kinds under it and therefore under the Company Law as the Company is on* legal entity these features are bound to be common and may not to enough to lead to the conclusion ,that 522 the various undertakings carried on by the Company are one integrated whole and therefore when wagestructure etc. has to be fixed in any particular. unit the over all position of ' the Company as a whole must be taken into account. On the other hand there are certain features which have been pointed, out by the tribunal and which are not in dispute which go to show that the Company has been treating its various units as independent concerns in actual practice. Each unit has separate books of account and separate profit and loss account showing how each particular business is faring. Each unit has separate muster rolls for its employees and transfers from one unit to the other, even where such transfers are possible considering the utterly different kinds of business that the Company is carrying on, usually take place with the consent of the employees concerned. Further each unit has got its own separate wages and separate dearness allowance and other different allowances and bonus is also paid differently in each concern. Further even where sales take place from one unit to another they take place at market rate and not at cost price and are adjusted on this basis in the books of account. Lastly though there is a common board of directors and a common managing agency of the Company. each unit has its own separate management as it is bound to be for the business carried on by different units is in many cases utterly different. It is on these facts that we have to see whether the chemical works can be said to be so integrated with the other units of the Company as to justify the conclusion that it is part of the same business, and the entire business carried on the Company is one establishment, and therefore it would not be right to have different wage structure, dear_ ness allowance, etc., in the same establishment. 523 This matter was considered by this Court in connection with Jay off in The Associated Cement Companies Limited, Chaibasa Cement Works, Jhinkpani vs Their Workmen(1), where tests were laid down for determining whether a particular unit is part of a bigger establishment. These tests included geographical proximity, unity of ownership,. management and control, unity of employment and conditions of service, functional integrality and general unity of purpose. But it was pointed out that it is was impossible to lay down any one test as an absolute and invariable test for all cases and the real purpose of these tests was to find out the true relation between the parts, branches, units. If in their true relation they constitute one integrated whole, then the establishment is one ; if on the contrary they do not constitute one integrated whole, each unit is then a separate unit. How the relation between the units will be judged must depend on the facts proved. Thus in one case the unity of ownership, management and control may be the important test, in another case, functional integrality, or general unity may be the important test; and in still another case, the important test may be the unity of employment. It was pointed out that in a large number of cases several tests may fall for consideration atthe same time and the difficulty of applying these tests arises because of the complexities of modern industrial organization. The matter was considered again by this Court in Pratap Press etc. vs Workmen (2), Pakshiraj Studios vs Workmen(3) Hony. Secretary, South India Millowners ' Association ' vs Secretary, District Coimbatore District Textile Workmen Union (4) and Fine Knitting Co. Ltd. vs Industrial Court, Bombay(4). In the case of Fine Knitting Co., this Court was considering one limited company but it was held in the circumstances that even though there was unity of ownership, management and control the two parts of the same concern (1) ; (3) (2) (4) C. A. 4 IQ of 1960, decided on 1 2 62. (5) C.A. 306 of 1961. decided on 15 2 1962. 524 different units as there was no functional integrality between them. It is on the basis of these tests that we have to consider whether the tribunal was right in its conclusion that the chemical works has to be treated as an independent unit. The common features which have been emphasized on behalf of the respondents are in our opinion clearly capable of explanation on the ground that the Company is a limited concern and carries on different kinds of business. But as in law under the Companies Act, the Company being a limited concern is one legal entity, the Common features on which the respondents rely follow from that one single circumstance, namely, that the Company is a limited concern governed by the Company Law. It would therefore in our opinion be not right to emphasis these common features and to hold on their basis only that the various businesses carried on by the Company have to be treated as one integrated whole for the purposes of wage structure etc. ' The outstanding fact in the present case is that though a large number of businesses is being carried on by the Company their nature in many cases is utterly different and one has generally speaking nothing to do with the other. The three main lines of business which the Company is carrying on are sugar, textiles and chemicals. It .is obvious that there is nothing common between these three different lines of business and there can be no question of one depending upon the other and there cannot be functional integrality generally speaking between these three lines of business. There might be some connection speaking between the chemical works and the textile mills of the Company inasmuch as some of the chemicals might be used in the textile mills; but the evidence shows that a very small proportion of the chemicals produced in the chemical works is used in the textile mills and that most of the production is sold in the open market. It cannot ' therefore be said that the chemical works as it now 525 exists is therefor the purposes of the textile mills and is thus integrated with the textile mills. Even in the matter of employment the evidence is that there is separate recruitment of labour for the different units and each unit has separate muster rolls of employees and this is quite natural considering that different skill is required for the three lines of business carried on by the Company. It cannot also be said that there is any essential dependence of the chemical works on the textile units or that one cannot be operated without the other. Further the way in which the Company has been dealing with different units in the past also shows that they have been treated as independent units. Each unit has its own separate labour union and separate agreements are entered into between the Company and its unions with respect to the conditions of service which are also different for different Units. Even in the matter of bonus there are differences between the different units and these differences sometimes arose out of different agreements between the various units and their unions. It appears that even in the case of units carrying on the same business, as for example, textile, the workmen themselves contended in an earlier adjudication that the Delhi Cloth Mills and the Swats Bharat Mills were two distinct and separate units of the Company. In any case whatever may be said as to the units in the same line of business it is in our opinion perfectly clear that there is no nexus of integration between different lines of business carried on by the Company on the facts which have been proved in this case. We are of opinion therefore that the ratio of the decision in the Fine Knitting Co. 's case(5) applies to the facts of this case and it must be held that the chemical works is an independent unit and therefore in fixing the wage structure etc. we have to look to the position of the chemical works only and cannot (5) C.A. 306 of 1961, decided on 15 2 1962. 526 integrate it with other units and consider its wage structure etc. on the basis of such integration. It is in the background of the above finding, namely, that the chemical works is an independent unit that we now come to the specific points raised in the two appeals. We shall first take the appeal by the workmen. The following four contentions only were pressed before us on their behalf : (i)Even considering the chemical works as an independent unit, the tribunal should have fixed a wage structure including incremental scales ; (ii)The tribunal should have given the same minimum scales to the workmen employed in the canteen as are being given to the other workmen in this concern; (iii)The tribunal should have made those members of the civil engineering 'department who had been working for more than one year permanent and should have given them the same terms and conditions of service as are enjoyed by other workmen of the concern ; (iv)The tribunal should have awarded further bonus to the workmen. (i) The contention on behalf of this respect is that there are no incremental scales in this concern and the tribunal, should have at any rate made a beginning by fixing some incremental scales for the workmen. The tribunal however has refused to fix incremental scales on the ground that the concern has neither financial ability nor stability to justify the fixing of incremental scales at the present time. It is not in dispute that throughout 527 the course of its existence the chemical works has made profits only in two years and that for the rest of the time it has been making losses which had to be met by the Company out of the profits of other units. Reliance in this connection has been placed on behalf of the respondents on certain observations in the Tariff Commission Report and on a book called "Fertilizers Statistics in India" to show that the chemical industry has a very prosperous future in front of it. Reliance has also been placed on a communication addressed by the appellant to the respondents in which it has been said that judging from sound business principles the chemical works had not yet turned the corner of losses, but the position appeared brighter, and it was hoped that with the co operation of labour the chemical works would be an asset to the D. C. M. family. Our attention has also been drawn to various annual reports in which an optimistic picture has been painted by the directors for the benefit of the shareholders. We agree however with the tribunal that in spite of the possibility that in time to come the chemical works might acquire stability and prove a source of increasing profit to the Company, the fact remains that upto now the. chemical works has been running at a loss except for two years and one cannot be certain that it will start earning profits soon. In these circumstances it seems to us that the tribunal was justified in not framing an incremental scale of wages at the present juncture as that would put a heavy strain on the finances on the chemical works which has yet to attain financial stability. At the present moment the losses incurred in this unit have to be met froth the profits earned in other units of the Company and in this situation we do not think that the tribunal was wrong in refusing, to frame incremental scales. It is however urged on behalf of the respondents that if in the course of the last twenty years the capital invested in the chemical works has increased 528 tremendously as compared to the modest amount with which it was started in 1942 and if the Company can find capital for the purpose of expansion, it should be able to pay incremental scales of wages by dipping into the same source from which it has been able to find capital. In effect this argument means that even though the concern may be making losses year after year it should find money for paying the labour force higher wages in spite of the circumstance that that may lead it into incurring further losses. The argument seems to be that even though there may be losses the concern must pay higher wages to the workmen and if necessary pay them out of what may be called capital. Now this argument would in our opinion be unanswerable if the claim was for what is called minimum wage: (See Messrs Crown Aluminium Works vs Their Workmen (1). If the wages paid by the appellant in the present case were below the minimum wage that the tribunal would certainly be justified in ordering it to pay the minimum wage, for no industry can have a right to exist if it cannot pay wages at the bare subsistence level. Where it is a case of payment of minimum wage, the tribunal can insist on the same being found, if necessary, even out of capital. But this is not a case of bare minimum wage and we are dealing with a case of fair wage which is above the bare minimum wage. It is not even the case of the respondents that they are not getting the bare minimum wage. Their case is that they should be given a fair wage, and that the present wages, though above the bare minimum wage, are still not fair enough and therefore should be increased and an incremental scale should be fixed. In such a situation we are of opinion that the present financial condition of the concern and its stability are both necessary to be considered before an increased fair wage can be given. Both the present capacity of (1) ; 529 of the employer to pay the increased rates of incremental wages and its future capacity have to be taken into account in determining an increased level of fair wages based on an incremental scale. Thus both financial ability at present and financial stability in the near future must be there to justify fixation of an increased fair wage on an incremental scale. We do not think it will be right to insist on an increased fair wage on an incremental scale in a case where the financial capacity and the financial stability as judged by business principles are both lacking. Nor would it in our opinion be right to compel the employer to bear the burden of an increased fair wage on an incremental scale and tell him to find money from what may in effect be capital, for such a 'situation in ordinary cases can lead only to one result, namely, the closure of the business concern, which may be more detrimental to the workmen. Therefore carrying on with the present scale of fair wages and hoping that the financial ability and stability of the concern will improve, with the result that increased fair wage on an incremental basis may be fixed in future is the only alternative at present even in the interest of the workmen employed in this ' concern. We therefore agree with the tribunal that in the circum,stances no case has been made for fixing an incremental scale of wages at the present juncture. The contention this head must therefore be rejected. As to the canteen workmen, it appears that the canteen is run by the appellant departmentally on a no profit no loss basis. The workmen employed in the canteen are the workmen of the appellant and their number is sixteen or seventeen. The minimum basic wage for unskilled workmen in this concern at the relevant time was Rs. 38 plus Rs. 55 i. e. Rs. 93 ; but the workmen in the canteen get consolidated wages and all of them (except one) get 530 much less than the minimum, the figures varying from Rs. 50 to Rs. 78. The tribunal has held that there is no reason why the conditions of service of the workmen in the canteen should not be brought on a par with the conditions of service of the rest of the workmen. It therefore ordered that the workmen in the canteen would be entitled to the same facilities relating to leave, provident fund, bonus, and gratuity etc. as are available to the other workmen in the chemical works ; but so far as wages and dearness allowance are concerned, it has not given them even the minimum as indicated above. The case of the the appellant was that even if ' the minimum was paid to the workmen in the canteen the price of the various food stuffs supplied by the canteen to the workmen would go up substantially and it was on that ground that the appellant resisted the increase in the wages of those workmen in the canteen who are getting less than the minimum of Rs. 93. The tribunal has held and we think rightly that the fact that the bettering of the conditions of service of the workmen in the canteen may lead to a rise in the price of things sold ' there is no reason for refusing the demand of the workmen ; but it has not carried into effect fully the implications of this observation. It has ordered that same conditions as to leave facilities etc. should be extended to the canteen workmen but has stopped short of giving them the same wages and dearness allowance. The reason why the tribunal did not give the workmen the same wages and dearness allowance is that there was no satisfactory material before it to permit it to fix wages and dearness allowance for the workmen in the canteen. We are of opinion that there is no reason why the tribunal should not have at least granted the minimum which is paid to the other workmen in the concern to those workmen in the canteen who are getting less than the minimum. We can see no reason for not giving them also the 531 minimum wages as indicated above. This will certainly result in bringing the fifteen workmen who are getting between Its. 50 and Rs. 78 per mensem as consolidated wages into an equal position, for each will then get the minimum, namely,. Rs. 38 plus Rs. 55 and may remove part of the discontent. In the circumstances that is all that can be done in the absence of the material to which the tribunal has referred. Therefore the wages of those fifteen workmen who are getting less than the minimum should be brought to the same level. There is no reason why they should not get such benefits as may be due to them, by their wages being brought to the same minimum as the wages of the other workmen in the concern. We therefore disagree with the tribunal with respect to the workmen employed in the canteen and order that the wages of those workmen who are getting less than the minimum paid to the other workmen in the concern should be brought to the same minimum level. The rest of the award on this head will stand. The minimum wages as above will be paid from the date the tribunal has ordered its award to come into force. (iii) The claim of the workmen in this connection was that there were 300 workmen employed in the civil engineering department and that they should be made permanent. The ' tribunal however rejected this contention and pointed out that most of the workmen were temporarily engaged to carry on construction work which was of a temporary nature and therefore. they could not be made permanent simply because the construction had lasted for more than a year. This view of the tribunal is in our view correct in so far as the claim put forward with respect to all the three hundred workmen was concerned. It appears however that at the time when the tribunal recorded 532 evidence the large majority of these 300 workmen had been discharged because they were no longer required and only about 65 remained in service. It appears from the evidence 'of the Joint Works Manager that a skeleton staff on the civil engineering side is kept for maintenance of buildings and this skeleton staff is of a more or less permanent nature. The argument therefore before us is that at any rate this skeleton staff should be made permanent. It was however urged on behalf of the appellant that this was not the way in which the matter was put before the tribunal. The position now is however clear that a skeleton staff is kept on a permanent basis for the civil engineering department and it seems to us fair that the appellant should be directed to make this skeleton staff permanent and give them the same facilities and wages etc., as are given to the other workmen. We therefore direct that the appellant shall make such of the skeleton staff as is maintained for civil engineering purpose permanent and give them the same conditions of service including the same minimum wages etc. as to the rest of the workmen. It is however left to the discretion of the appellant to determine what should be the strength of this staff and which persons should be retained as permanent employees. We say this because the matter was not gone into from this point of view before the tribunal and we have no material on which we ourselves can determine the strength of the skeleton staff and the persons who should ' be made permanent on that account. The direction will be given effect to within three months of this judgement. The workmen have been given 2 1/2 months basic wages as bonus for the years in dispute, namely, 1953 54 and 1954 55. They have claimed additional bonus. It is however conceded fairly 533 on behalf of the respondent that if the chemical works is treated as an independent unit their case for additional bonus on the basis of the Full Bench formula cannot succeed. The demand for additional bonus was rightly rejected by the tribunal, considering the chemical works as an independent unit. We may add that this case is distinguishable from the case of Hony. Secretary, South India Mill owners Association, (1) for here the two lines of business are distinct and have nothing to do with each other. This brings us to the appeal by the appellant. Five points have been urged on behalf of the appellant. They are: (i) dearness allowance; (ii) uniforms, (iii) acid and gas allowance. (iv) leave facilities, and (v) gratuity. We shall deal with them one by one. So fag as dearness allowance is concerned, the tribunal has ordered that the dearness allowance in the chemical works shall be fixed at the same rate as it is in the power house which is a part of the chemical works. It may be mentioned that dearness allowance at the relevant time in the chemical works was Rs. 55 per mensem while in the power house it was Rs. 66 per mensem. The contention on behalf of the appellant in this connection is that the reason why there was this difference 'between the dearness allowance in the power house and in the rest of the chemical works is historical. It is further pointed out that though the difference in the two dearness allowances is Rs. 11 the actual difference in the total wage packet was only Rs. 3 inasmuch as the minimum basic wage in the power house was Rs. 30 while in the chemical works it was Rs. 38 at the relevant time. Thus the minimum that an employee was getting in the power house was Rs. 96 while the minimum for the rest of the workmen was Rs. 93, and it is (1) C.A. 419 of 1960. decided on 1 2 1962. 534 urged that the difference is not serious. The reason that the tribunal gave for increasing the dearness allowance for the other workmen in the concern was that there was no ground for discriminating between the workmen in the power house and the rest of the workmen. In increasing the dearness allowance on this sole ground the tribunal ignored firstly the historical reason why there was this difference between the dearness allowance for the power house staff and for the rest of the workmen and also ignored the difference in the basic minimum wages in the power house and for the rest of the workmen. It further seems to have ignored its own earlier finding that the chemical works was running at a loss and did not have the financial capacity to bear further burden. As a matter of fact it appears that but for this discrimination which the tribunal found between the rate of dearness allowance for the power house employees and the rest of the workmen it may not have made any change in the dearness allowance payable to the rest of the workmen. It may be mentioned that the system of dearness allowance in the concern is to allow neutralization at the rate of 2 1/2 annas (now 17 nP.) for each point rise over the working class cost of living index treating the base as 100 for the year 1939. It may also be mentioned that since the reference was made there has been a voluntary increase in the dearness allowance for the rest of the workmen at the rate of Rs. 6 per mensem. The reason why this difference is existing between the rate of dearness allowance for the power house employees and rest of the workmen is that for sometime the power house was integrated with the Swatantra Bharat Mills. Therefore as an integral part of the cotton textile industry the rates of basic wages and dearness allowance 535 in the power house were the same as in the cotton textile business of the company. Thus the rates there at the relevant time were, as we have already said, Rs. 30 basic wage and Rs. 66 dearness allowance. At that time the minimum wage in the chemical works was Rs. 38 basic plus Its. 55 dearness allowance i.e. Rs. 93 in all. It appears however that there was some objection by the Excise Department of the Government as there was a gate between the Swatantra Mills and the chemical works. The Excise Department wanted this gate to be blocked in order to have better control over the excisable articles produced in the chemical works. The appellant therefore had to block up this gate in 1950 and therefore the power house which existed on the chemical works side of this gate was transferred from the Swatantra This to the chemical works. However as the power house workmen were getting the textile rates, the Company assured them that trough they would thereafter be under the control of the chemical works they will be governed for the purposes of pay scales and dearness allowance of I c. by the rule of the Swatantra Mills. It is this circumstance which has resulted in different scales for the power house staff and the rest of the workmen of the chemical works. It further appears that there was some retrenchment in the power in 1957 and the retrenched workmen were absorbed as far as possible in others units. At that time there was an agreement between the Company and the power house workmen and it was agreed that these workmen would be absorbed in other units but they would accept the conditions of service etc. of those units where they were absorbed, with the result that only those who are left in the power house continue on the textile scales of the Swatantra Bharat Mills. These circumstances however were not taken into account by the tribunal at all when it ordered that the power house scale of 536 dearness allowance should be introduced for the rest of the workmen also. The power house scale is really the textile scale and the appellant contended that it would lead to a good deal of complication if the textile scale of dearness allowance is ordered to be introduced for the chemical works. We are of opinion that there is force in this contention raised on behalf of the appellant and the tribunal was not justified in increasing the dearness allowance for the chemical works merely because of this fortuitous circumstance arising out of historical reasons. In any case the number of the power house workmen is very small, say about 30140, who who are getting a different rate of dearness allowance: Further it appears that there was not much difference between the total wage packet for the power house workmen and for the rest and that was another reason why the tribunal should not have introduced the power house scale for the rest of the workmen. It has however been urged on behalf of the respondents that the difference in the basic minimum wages between the power house workmen and the rest of the workmen in the chemical works has disappeared after the recommendations of the Textile Wage Board by which the minimum basic wage for textile workers has been increased by Rs. 8 and it became Rs. 38 from January 1, 1960. Therefore, it is urged that there .is no reason why the tribunal 's award with respect to making the dearness allowance for the rest of the workmen the same as the workmen of the power .house should not be allowed to stand. Superficially, this argument looks attractive ; but if one examines it in the light of the Textile Wage Board 's recommendations it will be found that the linking of the dearness allowance. for the chemical work 's workmen with the power house workmen would lead to endless complications, for the power house workmen would be entitled to the same dearness allowance etc, as would govern the textile workmen in the 537 Swatantra Bharat Mills. The Textile Wage Board report shows that it recommended not only that the basic wage should be increased but also that a large part of the dearness allowance should be merged with basic wage, the remainder alone remaining as dearness allowance. It is submitted on behalf of the appellant that it has carried out the recommendations of the Textile Wage Board and the result of the same has been that the basic wages of the textile workmen which would apply to the power house workmen would be fixed at about Rs. 88 or Rs. 89 and the dearness allowance would be reduced to about Rs. 15. It is urged that the practical linking of the dearness allowance for the rest of the workmen with the dearness allowance in the power house which has been ordered by the tribunal on the ground that there should be no discrimination., would result in endless trouble, apart from the question whether in view of the earlier finding of the tribunal as to the financial. capacity of the appellant it would be possible for the appellant to bear the extra burden of the increased dearness allowance. The operative order of the tribunal is that the workmen of the chemical works, excluding the workmen who are governed by exhibit W/2, should be paid dearness allowance at the rate at which it is being given to the workmen of the power house, and this undoubtedly in our opinion would lead to endless trouble now that the recommendations of the Textile Wage Board will for historical reasons apply to the workmen in the power house. Which are therefore of opinion that the ground on which the tribunal ordered the rate of dearness allowance for the other workmen of the chemical works to be paid on a par with the rate for the power house is not sustainable and the tribunal went wrong in not giving due weight to the histori cal reasons for the rates prevailing in the power house. Further we are of opinion that the increase is not sustainable on its own merits on the ground 538 of the financial capacity of the concern, which the tribunal itself found was not sound, as the concern bad been running at loss practically since it came into existence except for two years. The contention therefore on behalf of the appellant on this head must be accepted and the order of the tribunal increasing the dearness allowance set aside. As to uniforms, we see Do reason to differ from the view taken by the tribunal. The reasons given by the tribunal for ordering that uniforms should be given to certain category of workmen Are in our opinion sound. But the tribunal bat; trade a mistake when it went on to order that protective equipment should also be given in addition to uniforms, to the persons found entitled to uniforms according to the directions of the tribunal. The tribunal seems to have overlooked the difference between uniforms and protective equipment; which is provided in the Delhi Factory Rules. So far as protective equipment is concerned, it is given for certain specific purposes to be found in the Rules and has no connection with uniforms which employers are ordered to supply to their workmen, for reasons entirely different. We are therefore of opinion that the direction of the tribunal that protective equipment should also be supplied to persons found entitled to uniforms under its order, is not correct and should be set aside. So far as protective equipment is concerned, it will only be supplied to those who are entitled to it under the Delhi Factory Rules and not necessarily to all to whom uniforms may have to resupplied under the orders of the tribunal. We order accordingly. (iii). At; to acid and gas allowance, the tribunal has ordered the payment of Rs. 3 per month to certain categories of workmen. It appears that originally 539 the appellant used to pay Rs. 5 as acid and gas allowance in the Nitric acid gas plant and Rs. 3 in the contact plant. Later, however, this gas allowance was merged in pay. But it appears that gas allowance, is still being paid to the workmen in the pity trie acid gas plant. It 'is contended on behalf of the appellant that this was because the gas allow ance in the case of these workman was not merged in pay. There is, however, nothing on the record to prove this. As the record 'stands we have no reason to hold that the gas allowance which was originally paid to the workmen of the nitric acid gas plant was riot merged in their pay. On the whole therefore the reasons given by the tribunal for making the allowance (1) Rs. 3 to those workmen who are engaged in the manufacture of chlorine, sulphuric acid, caustic soda and hydrochloric acid Appear to us to be sound and we see no reason to interfere with that part of the award. So far as leave facilities are concerned, the tribunal has awarded that privilege should be granted as provided under the Factories Act. It has further provided that casual cum sick leave should be granted,for twelve days in the year. We do not think that this award is in any way, unreasonable. The"tribunal has however gone on to deal with festival holidays, and that in our opinion the tribunal had no jurisdiction to do. The reference was in these terms : "Whether leave facilities should be increased and if so, to what extent". There was no with respect, to holidays. The tribunal has however taken the view that holidays are covered within the words "leave facilities" used in the order of reference. We are of opinion that this view is incorrect. Holidays are entirely different in leave facilities. On a, 540 holiday the entire business is closed and no one works while leave facilities deal with leave for individual workers while the business as a whole is running. We may in this connection refer to item 4 of the Third Schedule to the Industrial Disputes Act (No. 14 of 1947), which is in these terms : ""Leave with wages and holidays". This shows that holidays stand on a different footing altogether from leave with wages and a reference with respect to leave facilities cannot include a consideration of holidays. The tribunal 's order with respect to holidays is set aside. Lastly we come to the gratuity scheme sanctioned by the tribunal. It is true that in this concern there is already a provident fund scheme in force. But it is now well settled that both gratuity as well as provident fund schemes can be framed in the same concern if its financial position allows it. It is true that the financial position of the chemical works has not been found to be good and stable enough to warrant an incremental wage structure ; but gratuity is a long term provision and there is no reason to suppose that in the long, run the appellant will not be in a flourishing condition. As to the burden of the scheme, we do not think that, looking at it from a practical point of view and taking into account the fact that there are about 800 work men in all in the concern, the burden per year would be very high, considering that the number of retirements is between three to four per centum of the total strength. Further we find that in this very concern there is a gratuity scheme for clerks who number between 100 and 200 and are part of the labour force. We can see under the circumstances no reason why a similar gratuity scheme should not be framed for the rest of the 541 workmen. We therefore see no reason to interfere with the order of the tribunal in this respect. We therefore allow the appeals in part and dismiss them in part in the manner indicated in the course of this judgment. In the circumstances parties will bear their own costs in both the appeals. Appeals allowed in part.

The disputes between the appellant, the management of the D.C.M. Chemical Works which was a constituent unit of the Delhi Cloth and General Mills Limited (the Company), and its workmen related, inter alia, to wage scales and gratuity. The workmen claimed that the chemical works was an integral part of the Company and, therefore, the over all position of the Company should be taken into account in fixing the wage structure. The Industrial Tribunal to which the matter was referred held that in the circumstances of the case the chemical works should be treated as an independent unit and that the wage structure etc. could not be fixed on the basis of the over. all position of the Company. The facts showed that the high the Company was a single limited concern owning and controlling various industrial units of different kinds under it. There were certain features which went to show that the various undertakings carried on by the Company had been treated as independent concerns and could not lead to the conclusion that they were one integrated whole. It was found that (i) each unit had separate books of account and separate profit and loss account, (ii) each unit had separate muster rolls for its employees, and transfers from one unit to the other usually took place with the consent of the employees concerned, (iii) each unit had its own separate wages and dearness allowance and bonus was also paid differently in each concern,(iv) where sales took place from one unit to another they were at market price and not at cost price, and (v) each unit had its own separate management. The evidence showed that throughout the course of its existence since 1942 the chemical works had made profits only in two years and that for the rest of the time it had been making losses which had to be met by the Com pany out of the profits of other units. Held, that on the facts found in the present case, there was no nexus of integration between different lines of business carried on by the Company and that the Tribunal was right in 517 its conclusion that the chemical works was ' an independent unit and that, therefore, in fixing the wage structure etc. , one had to look to the position of the chemical works only and could not integrate it with other units. The Associated Cement Companies Limited, Chaibassa Cement Works,Jhinkpani vs Their Workmen, (1960) 1 S.C.R. T, 703, Pratap Press etc. vs Workmen, , Pakshi raja Studios V. Workmen, and Hony. Secretary, South India Milloumers 'Association vs Secretary, District Coimbatore District Textile Workmen Union, (1962) (2) S.C.R. (Supp.) p. 926 relied on. Fine Knitting Co. Ltd. vs Industrial Court, Bombay, (1962) (3) S.C.R. (Supp.) p. 196, applied. Held, further, that in making a direction for the fixation of an increased fair wage on an incremental scale, the present financial condition of the concern and its stability are both necessary to be considered. There is a difference between a minimum wage and fair wage which is above the bare minimum wage. In the former case the tribunal could insist that the employer paid minimum wages even out of capital. Messrs Crown Aluminium Works vs Their Workmen, (1958) S.C.R. 651, referred to. Held, also, that it is well settled that both gratuity As well as provident fund schemes can be framed in the same concern if its financial position allows it, and that though the financial position of the chemical works had not been found to be good and stable enough to warrant an incremental wage structure, the direction given by the Tribunal for the framing of a gratuity scheme was not erroneous, as it was a long term provision and there was no reason to suppose that in the long run the appellant would not be in a flourishing condition.

Appeal No. 121 of 1951. Appeal from the Judgment and Decree dated 15th December, 1948, of the High Court of Judicature at Madras (Subba Rao and Pancha,Pakesa Ayyar JJ.) in Appeal No. 474 of 1945 arising out of the Judgment and Decree dated 3 1 st July, 1945,, of the Court of the Subordinate Judge of Tenali in Original Suit No, 24 of 1944. 130 1002 M. C. Setalvad, Attorney General for India, (N. Subrahmanyam and K. R. Chowdhury, with him) for the appellants. K. section Krishnaswamy Aiyangar (M. Seshachalapathi, with him) for the respondents. February 26. The Judgment of the Court was delivered by DAS J. This appeal arises out of a suit for recovery of possession of certain immovable properties measuring about 93 acres and 33 cents which are more fully and particularly set out and described in Schedule A to the plaint. That suit was instituted by Konduru Venkatapayya, respondent No. 1, in his capacity as the Executive Officer appointed by the Government on the 15th July, 1942, in respect of Sri Somasekharaswami Temple at Kotipalle, hamlet of Donepudi, a temple notified on the 26th October, 1939, under the provisions of Chapter VIA of the Madras Hindu Religious Endowments Act (Act 11 of 1927). The suit was instituted in forma pauperis. The claim for ejectment of the defendants was founded on the allegation that the properties belonged to the temple, having been given to it by an Inam grant made in 1770 A.D. by Janganna Rao, the then Zamindar of Rachur, that the defendants I to 16 and their predecessors were Archakas rendering Nitya Naivedya Deeparadhana services and as such were in possession of the properties for and on behalf of the temple and that defendants 17 to 43 were the lessees under the Archakas and that the defendants I to 16 were wrongfully claiming the properties as their own and the other defendants claimed to be in possession of portions of the properties as their lessees. The plaintiff instituted this suit after having given registered notice to the defendants to make over possession of the suit properties to the plaintiff as the Executive Officer of the temple but the defendants were still continuing in such possession in spite of such notice. The defendants filed written statements raising various contentions 1003 and issues to which it is not necessary now to refer. The learned Subordinate Judge by his judgment dated the 31st July, 1945, decreed the plaintiff 's suit. Some of the defendants preferred an appeal to the High Court but the High Court dismissed the same. Those defendants obtained leave of the High Court to appeal to the Federal Court and that appeal has now come up for hearing before us. The only two points which were raised before us, as before the High Court, are (1) whether the Inam grant was made in favour of the temple or whether the grant was made in favour of the Archakas burdened with the duties of service, and (2) what right did the grant confer on the grantee whether it was a grant of the land itself or only of the melvaram interest in the properties. It is urged by the learned Attorney General that as the defendants and their predecessors have been in possession of the properties from ancient times it should be presumed that their possession originated in some lawful title conferred on them. In short, the contention, founded on several judicial decisions, is that the principle of a lost grant should be applied in this case in favour of the Archakas who have been in quiet possession for over a century and a half. There is no doubt, on the authorities, that a presumption of an origin in some lawful title may in certain circumstances be made to support possessory rights long and quietly enjoyed where no actual proof of title is forthcoming but it is equally well established that that presumption cannot be made where there is sufficient evidence and convincing proof of the nature of the grant and the persons to whom it was made. It is true that the original grant is not forthcoming but turning to the evidence we find two documents which appear to us to be decisive on the question of title. The first one is Exhibit P/3, a copy of the relevant entries in the Inam Register of 1860. This Inam Register was prepared after enquiries made by the Inam Deputy Collector and the statements furnished at that time by the then Archakas were taken into consideration for 1004 preparing the register. The copy of the statement filed by the then Archakas before the Inam Deputy Collector was exhibited in this case as Exhibit D/3. In the Inam Register (exhibit P/3) under the several columns grouped under the general heading " Class extent and value of Inam " this Inam is classified in column 2 as Devadayam. In column 3 are set out the survey numbers together with the word ' Dry ' indicating the nature of the land comprised within the survey numbers. The areas are set out in column 5. The heading of column 7 is " where no survey has been made and no assessment fixed by Government, the cess paid by the ryot to the Inamdar, or the average assessment of similar Government land should be entered in column (7) ". Under this heading are set out the amounts of respective assessments against the three survey numbers totalling Rs. 198139. We then pass on the next group of columns under the general heading " Description, tenure and documents in support of the Inam ". Under column 8 'description of Inam 'is entered the remark " For the support of a Pagoda. Now kept up ". The entry in column 9 shows that the Inam was free of tax, i.e., sarvadumbala. Under column 10 headed "Hereditary, unconditional for life only or for two or more lives " is mentioned ' Permanent '. The name of the grantor as stated in column 1 1 is Janganna Rao and the year of grant is fasli 1179, A.D. 1770. In column 13 the name of the temple is set out as the original grantee. The name of the temple and the location of the temple are also set out under columns 16 and 17. Turning now to the statement exhibit D/3 caused to be written and filed by the then Archakas during the Inam Inquiry held in 1859 60 Sree Somasekharaswami Varu is given as the name of the Inamdar and the present enjoyer. The name of the temple is also set out under columns 3,5,6 and 12. Under the heading " Income derived from the Inam whether it is sarvadumbala or jodi. lf jodi the amount" in column 13 is stated " sarvadumbala Inam Cist according to the rate prevailing in the neighbouring fields Rs. 26631. " This statement (exhibit D/3) bears 1005 the signature of the Karnams and the witnesses. it will be noticed that neither in the Inam Register exhibit P/3 nor in the statement exhibit D/3 is there any mention of the Archakas as the grantee or for the matter of that, having any the least interest, personal or otherwise, in the subject matter of the Inam grant. The two exhibits quite clearly indicate that the Inam grant was made in favour of the temple by the gurant or and that in the face of this definite evidence and proof of the nature of the grant, no presumption of a lost grant can be made in favour of the Archakas. We, therefore, in agreement with the High Court, hold that the deity was the grantee and the first question raised before us must be answered against the appellants. The learned Attorney General next contends that, assuming that the Inam grant was made in favour of the temple, it was only a grant of melvaram interest and that the Archakas who have the kudivaram rights cannot be ejected. He relies strongly on an unreported judgment of the Madras High Court in Appeal No. 213 of 1942 (The Board of Commissioners for the Hindu Religious Endowments, Madras vs Parasaram Veeraraghavacharyulu and others) where it was held: "The records of the Inam settlement really contain only one clear indication as to the precise extent of this grant. The statement at the Inam Inquiry, Exhibit V, upon which the decision of the Inam Commissioner was presumably based contains a column headed " Income realised from the Inam sarvadumbala " and in that column we find the entry "Rs. 14 sarvadumbala". On its face this entry seems to show that the income of the Inam was Rs. 14 free from all charges. We find, however, from the Inam Register, Exhibit IV, that the assessment of the Inam on the basis of the enjoyment of 16 97 acres is also Rs. 14. This seems to indicate that the extent of the Inam was the amount of the assessment. * * * * * It seems, therefore, that the decision must rest on the recital in Exhibit V that the income of the Inam 1006 consists of Rs. 14, read along with the recital in Exhibit TV that the assessment on the land also comes to Rs. 14. On these materials we confirm the findings of the learned District Judge, although we do not accept his reasoning, and hold that the grant is a grant of melvaram only. " The facts of that case appear to us to be different from those in the present case. The Archakas in. that case were found to have the kudivaram rights from before the Inam grant was made. In the copies of the Inam Register and Inam Statement filed in that case the Archakas were shown as the grantees and the present enjoyers of the Inam grant and the amount shown under the heading in column 2 of the Inam register as the assessment was the same as the amount shown under column 3 of the Inam Statement under the heading "Income derived from Inam". In the case before us the Archakas are nowhere mentioned in either Exhibit P/3 or in Exhibit D/3, there is no evidence that they had any title to kudivaram rights and finally the amount of assessment shown under column 7 of the Inam register, Exhibit P/3, is Rs. 198139, whereas the amount shown as income derived from the Inam as shown in column 13 of the Inam Statement, Exhibit D/3, is Rs. 26631. Apart from these points of distinction the decision relied on by the learned Attorney General appears to us to be of doubtful authority. As will appear from the passages quoted above, the decision rested mainly, if not entirely, on the fact that the amount of assessment and the amount of income were the same and the conclusion was drawn that the Inam grant comprised only of the revenue assessment, i.e., of melvaram rights. We are unable to follow the reasoning. Whether the Inam comprised the land itself, that is to say, both melvaram and kudivaram rights or only the melvaram rights, the entries had to be made in the Inam Register in the same form and even in the case of the grant of the land itself comprising both the rights the amount of assessment had to be set out under column 7 of the Inam Register for it is not 1007 suggested that a different form had to be used where the grant comprised both the rights. It follows, therefore, that no inference that the Inam grant comprised only melvaram rights can be inferred from the fact that under column 7 only the amount of assessment is set out, and, therefore, the reasoning on which the decision relied on by the learned Attorney General was founded cannot be supported as correct. Indeed, that decision has been dissented from by another Bench of the Madras High Court in Yelamanchili Venkatadri & another vs Vedantam Seshacharyulu and others (1). In the present case the High Court was, in our opinion, clearly right in preferring the last mentioned decision to the unreported decision mentioned above. Having regard to the different entries under the different columns in Exhibit P/3 and Exhibit D/3 there is no escape from the position that this Inam grant in favour of the temple comprised both the interests in the land. An argument was sought to be raised by the learned Attorney General that the grantor Janganna Rao was only the Collector of the revenue and as such could not grant more than what he had got. Reference was made to the Kistna District Manual by Gordon Mackenzie but it appeared that the person therein mentioned was not the same grantor as we are concerned with in this case and the point was not pursued and nothing further need be said about it. Finally, the learned Attorney General submits that these Archakas who were rendering services faithfully from generation to generation from ancient times should not, in equity, be ejected from the entire lands and that they should be allowed to remain in possession of the lands and be permitted to appropriate to themselves the expenses of the services and a reasonable remuneration and the rest of the income should be made over to the temple as its property. Reference was made to two unreported decisions of the Madras High Court in Appeal No. 218 of 1946 (1) A.I.R. 1948 Mad. 72, 1008 Dandibhotla Kutumba Sastrulu vs Kontharapu Venkatalingam, and in Appeal No. 709 of 1944, Buddu Satyanarayana vs Dasari Butchayya, Executive Officer of the Temple of Sri Malleswaraswami Varu, China Pulivaram. In a proceeding for the framing of a scheme relating to a temple it may be permissible to take into account the claims, moral if not legal, of the Archakas and to make some provision for protecting their rights, but those considerations appear to us to be entirely out of place in a suit for ejectment on proof of title. If the two decisions lay down, as it is contended they do, that the principles which may have a bearing on a proceeding for framing of a scheme or for enforcing the scheme that is framed may be applied to a case of the kind we have now before us it will be difficult for us to uphold them either on authority or on principle. Further what is the conduct of the Archakas defendants appearing on the record of this case ? Although they are Archakas they actually asserted an adverse right in the face of the honest admission of their predecessors in title, made in the Inam statement Exhibit D 3. Such conduct cannot but be regarded as disentitling them from any claim founded on equity. The explanation put forward for the first time in paragraph 7 of their present statement of case filed in this Court explaining the absence of a claim to the property by their predecessors at the time of the Inam Inquiry namely, respect for the deity enjoined by Agama Shastra is not at all convincing. Further, the giving of such equitable relief must depend on questions of fact, namely, the income of the property, the reasonable expenses and remuneration for the services, the amounts appropriated by them all this time and so forth which have not been investigated into in this case, because, no doubt, this question of equitable relief has been put forward as a last resort after having lost their battle. We do not think in the circumstances of the case any indulgence should be shown to the Archakas even if it were permissible for the Court in a suit of this description to give such relief. 1009 The result, therefore, is that this appeal must fail and is accordingly dismissed with costs. Appeal dismissed. Agent for appellant: section Subramaniam. Agent for respondent: M.S.K. Aiyangar.

Though a presumption of an origin in some lawful title may in certain circumstances be made to support possessory rights long and quietly enjoyed where no actual proof of title is forthcoming, that presumption cannot be made where there is sufficient evidence and convincing proof of the nature of the grant and of the persons to whom it was made. In the case of an inam grant, the mere fact that the amount shown in the In am Register as the assessment was the same as the amount shown in the Inam Statement under the heading "income from the inam" does not lead to an inference that the grant comprised only the melvaram rights and not the land itself. Though in a proceeding for framing a scheme relating to a temple it may be permissible to take into account the claims, moral though not legal, of the archakas and to make some provision to protect their interest, such considerations are out of place in a suit for ejectment of the archakas on proof of title, especially when they set up an adverse title and deny the title of the temple. [On the facts their Lordships held (i) that there was clear evidence that the inam grant in question was made by the grantor in favour of the temple and that in the face of this definite evidence as to the nature of the grant no presumption of a lost grant can be made in favour of the archakas of the temple; and (ii) that the grant was of the land itself and not of melvaram rights only.]

Appeal No. 379 of 1958. Appeal from the judgment and decree dated January 17, 1956 of the Patna High Court in Appeal from Original Decree No. 169 of 1947. L. K. Jha, D. P. Singh, R. K. Garg, M. K. Ramamurthi and section C. Agarwal, for the appellant. R. C. Prasad, for the respondent. September 15. The Judgment of the Court was delivered by DAS GUPTA, J. Can a wife 's sister 's daughter 's son be validly adopted to a person governed by the Benaras School of the Mitakshara Hindu Law ? That is the main question raised in this appeal brought on a certificate granted by the High Court at Patna. The plaintiffs who would succeed to the properties left by Babu Ram Singh on the death 629 of his widow but for the adoption of Devendra Singh which this widow made on June 9, 1935, brought the present suit for a declaration that Devendra Singh was not adopted by the second defendant, Babu Ram Singh 's widow and that in any case, the adoption is invalid in law and so Devendra Singh acquired no right in the properties left by Babu Ram Singh. The main ground on which the adoption is attacked as invalid is based on the fact that Devendra Singh is Babu Ram Singh 's widow 's sister 's daughter 's son. The other ground raised in the plaint based on the plaintiff 's allegation that Babu Ram Singh was governed by Mithila School of Hindu Law was negatived by the courts below and has been abandoned before us. No dispute is also raised now as regards the factum of adoption. The only question that arises in this appeal therefore is whether the adoption of a wife 's sister 's daughters son is valid in law. The High Court answered this question in the affirmative and dismissed the suit. It is against that decision that the present appeal has been preferred. In support of his contention that such an adoption is invalid in Hindu Law reliance is placed by the learned counsel on the following passage of Nanda Pandit 's Dattak Mimansa : (see Whitley Stokes 's Hindu Law Books at pp. 590 and 591). Accordingly, the brother, paternal and maternal uncles, the daughter 's son, and that of the sister, are excluded : for they bear no resemblance to a son. Intending this very position, it is declared in the sequel, by the same author: "The daughter 's son, and the sister 's son, are declared to be the sons of Cudras. For the three superior tribes, a sister 's son, is No. where mentioned as a son. Here even the 630 term "sister 's son" is illustrative of the whole not resembling a son, for prohibited connection is common to them all. Now, prohibited connection is the unfitness of the son proposed to be adopted to have been begotten by the individual himself through appointment to raise issue on the wife of another. The mutual relation between a couple, being analogous to the one, being the father or mother of the other, connection is forbiden: as for instance the daughter of the wife 's sister, and the sister of the paternal uncle 's wife". The meaning of the text is this. Where, the relation of the couple, that is of the bride and bridegroom, bears analogy to that of father or mother ; if the bridegroom be, as it were, father of the bride, or the bride stand in the light of mother, to the bridegroom, such a marriage is a prohibited connection. The two examples illustrate these cases in their order. In the same manner as in the above text, of the Grihaparisistha, on marriage, prohibited connection, in the case of marriage, is excepted and so in the case in question, one who if begotten by the adopter, would have been the son of a prohibited connection, must be excepted; in other words, such person in to be adopted, as with the mother of whom, the adopter might have carnal knowledge. It is urged that in view of this specific exclusion of a wife 's sister 's daughter 's son from the list of those who are fit for adoption there is no escape from the conclusion that such an adoption would be invalid in law. Learned Counsel has emphasised that great authority attaches to all statements of law as regards adoption that are contained in Dattak Mimansa. There is no doubt that for many years now the Dattak Chandrika of Kuvera and Dattak Mimansa of Nanda Pandit have been recognised to 631 be of great authority on all questions of adoption. It is true that Prof. Jolly in his Tagore Law Lectures had in no uncertain terms characterised the latter to be of little value; and eminent scholars like Dr. Mandlik and Golap Chandra Sarkar while writing in the latter part of the last century subjected many of Nanda Pandit 's views to unfavorable criticism. In spite of all this the Privy Council in Bhagwan Singh vs Bhagwan Singh(1) did recognise that both the Dattak Mimansa and Dattak Chandrika had been received in courts of law including the Privy Council as high authorities and after drawing attention to Lord Kingsdown 's statements as regards these in Rungama vs Atchama (2) and Sir James Colvile 's statement in Collector of Madura vs Moottoo Ramlinga Sathupathy(3), stated thus : ",To call it (i.e., Dattak Mimansa), infallible is too strong an expression, and the estimates of Sutherland and of West and Buhler, seem nearer the true mark; but it is clear that both works must be accepted as bearing high authority for so long a time that they have become embedded in the general law. " While saying this mention must also be made of the observations of the Privy Council in Sri Balusu Gurulingaswami vs Sri Balasu Ramalakshmamma(4) decided on the same date (March 11, 1899) but immediately before Bhagwan Singh 's Case, was decided, expressing their concurrence with the view that caution was required in accepting the glosses in Dattaka Mimansa and Dattak Chandrika where they deviate from or added to the Smirities. There can be no doubt that in laying down the rule that the adoption of the son of a woman who could not have been married by the adoptive father because of incongruous relationship (Viruddha Sambandha) Nanda Pandit was adding to the existing state of law. It 'is interesting to notice here that commenting on what Saunaka had said in describing the ' ritual of adoption that a (1) (1899) L.R. 26 I.A. 153, 161. (2) (1846) T.A. 1, 97. (3) (1863) 12 M.I.A. 397, 437. (4) (1899) L.R. 26 I.A. 113,136. 632 son should be adopted the Dattaka Chandrika observed at p. 14 : (Reflection of a son The resemblance of a son,or in other words the capability to have been begotten, by the adopter, through appointment, and so forth). (Sutherland 's translation). The Dattak Mimansa adopts this view, and introduces the further doctrine of (Viruddha Sambandha) relationship as a bar to adoption. It is unnecessary for us to examine what authority should be attached to this serious addition to the texts for determining who can be adopted, as for reasons to be presently mentioned we are of opinion that assuming that this rule should be accepted as of authority Nanda Pandit has stated this merely as a recommendation and not as a mandatory prohibition. For many years now courts have recognised the position that not only the Dharma Sutras and Grihya Sutras but also the commentaries thereon and digests mingle without hesitation statements of law which are intended to be recommendations merely with statements which are intended to be mandatory. In Balu Gurulingaswami 's case to which reference has just been made the Privy Council pointed out that recent extension of the study of Sanskrit had strengthened the view of Sir William Macnaughten that "it by no means follows that because an act has been prohibited it should therefore be considered illegal. The distinction between the vinculum juris and the vinculum pudoris is not always discernible," and adding to the previous statement of the Board in Rao Balwant Singh vs Rani Kishori(1) decided in the previous year the Privy Council observed these ,words of caution in Balusu Gurulingaswami 's case : .lm15 "They now add that the further study of the subject necessary for the decision of these (1) (1898) L.R. 25 I.A. 69. 633 appeals has still more impressed them with the necessity of great caution in interpreting books of mixed religion, morality and law, lest foreign lawyers, accustomed to treat as law what they find in authoritative books and to administer a fixed legal system, should too hastily take for strict law precepts which are meant to appeal to the moral sense, and ,should thus fetter individual judgments in private affairs, should introduce restrictions into Hindu society, and impart to it an inflexible rigidity never contemplated by the original law givers. " The importance of this caution has by no means decreased in the years that have gone by. It is therefore necessary to examine the words used by Nanda Pandit himself in laying down this rule against Viruddha Sambandha adoption. It has to be noticed that while he says (One who if begotten by the adopter would have been the son of a prohibited connection must be excepted Sutherland 's translation), he does not say anything about what would happen if Viruddha Sambandha Putra was adopted. If the rule was intended to be mandatory it is reasonable to expect that the author who as the treatise itself shows was a master of logic and well acquainted with the rules of logic and other rules which deal with the question of mandatory injunctions would give clear indication of that view. This was all the more reasonable to expect as he was introducing a new rule. But he contents himself with saying that We do not think this language that adoption of a son of a Viruddha Sambandha girl should be avoided, can properly be taken as mandatory so that the rule must be obeyed on pain of the adoption being otherwise invalid in law. Notice has necessarily to be taken in this connection of the fact that the only authority mentioned by Nanda Pandit himself against 634 Viruddha Sambandha marriage from which he deduces his rule of Viruddha Sambandha in matters of adoption is to be found in the text of Ashvalayana (The bridegroom duly qualified should marry a duly qualified maiden who is younger in years, is not a sapinda, is not of the same gotra, and whose marriage does not involve a viruddha sambandha) (contrary relationship). It is followed a little later by this comment: (Viruddha Sambandha is that Sambandha (relation) which is viruddha (contrary or im proper) owing to the relationship (existing) between the bride and the bridegroom (before their marriage) being similar to that of a father or mother. As for instance the daughter of the wife 's sister (and) the sister of the maternal uncle 's wife). Is this rule mandatory? In other words, would a marriage of a girl standing in the Viruddha Sambandha relationship to the bridegroom be invalid. We are not satisfied that this is the position in law. It is striking that though the numerous Dharma Sutras and Grihya Sutras, deal at great length with the question of the girl who can be taken in marriage not one of them with the solitary exception of Ashvalayana has anything to say about Viruddha Sambandha. Coming to more recent times the only Digest in which any reference to this Virudha Sambandha of Ashvalayana can be traced is in Nirnaya Sindbu (late 16th century). There is no reference to this however in Raghunandana 's exhaustive treatise on marriage udhvahatattva which was written in the early 16th century. In Nirnaya Sindhu there is only bald reference to this in these words 635 (There is also the bar to marriage by sayings (of sages). As in the Grihyaparishistha should not marry a girl of Viruddha Sambandha (incongruous relationship)" Viruddha Sambandha was illustrated thus : "As in the case of wife ',% sister 's daughter; father 's brother 's wife 's sister." without any comments whatsoever. It is reasonable to think that the numerous Smritikars and commentators who have dealt with the subject of marriage were acquainted with Ashvalayana 's text but (lid not think it necessary to refer to it as it was a recommendatory rule not considered to be of much importance. Mr. Jha argues that when a positive statement is followed by a negative statement, the negative statement should always be held to contain a prohibitory mandate. Thus he says that as after saying says next the rules contained in this latter portion should be held to be mandatory. We can find no justification either in the modern rules of interpretation or in the rules of interpretation of the old Hindu Shastras for such a view. One instance where a negative rule following a positive direction on this very subject of marriage cannot possibly be I considered to be mandatory can be found in Yajnavalkaya 's text : (Let him, whose life as bachelor is unsullied marry a wife who possesses good qualities, who has not been enjoyed by another, who is beautiful, who is not his sapinda, who is younger than himself, who is not suffering 636 from any complaints, who has brothers, and who does not belong to the family descended from the same primitive guide." Quite clearly the rule that a girl suffering from disease should not be married is not a mandatory rule even though it follows some positive rules about marriage. That this is the position has been pointed by Vigyaneshwar. It is interesting to notice in this connection Ashvalayana 's own statement about marriage rules in the fourth section of the first Chapter of his Grihaya Sutra. After saying (a daughter should be given to a man of understanding) he says in the next text (that one should marry a girl of understanding, good looks, good conduct and good qualities) and one who is not suffering from any disease. This also is a case of a positive statement that a person should marry a girl of understanding, good looks, good conduct and good qualities, followed by a rule that a person should not marry a girl suffering from disease. Even so, it cannot be imagined for a moment that this rule that one should not marry a girl suffering from disease is a mandatory rule, implying that marriage with such a girl would be invalid. In any case, argues the learned counsel, when we find the three rules against marriage to a sapinda girl and sagotra girl and Viruddha Sambandha girl in the same text as here and admittedly the first two are mandatory and marriage to a sapinda girl or a sagotra girl would be invalid there is no reason why the same result should not follow on breach of the third rule against marrying a Viruddha Sambandha girl. The reasons why marriage to a sapinda girl or a sagotra girl has always been held to be invalid are succinctly stated by Raghunandana in his Udhvahatattva in a passage which has been translated thus by Dr. Jogendra Nath Bhattacharyya in his Commentaries on Hindu Law; Third Edition, Vol. I at P. 188: 637 "The negative ordinances, prohibiting marriage with girls of the same gotra, pravara etc., are parudasa (exceptional clauses) having reference to a vidhi; they are also prohibitions proper, like the prohibitory rule about the sexual union on parva days, because they forbid such marriages by the accompaniment of condemnatory and penance clauses, (See Texts of Apastamba. and Sumantu), (cited on p. 187) and in view also of the fact that such marriages may spring from natural inclination. The term wife is like the terms yupa (sacrificial post) ahavaniya (sacrificial fire), and denotes a female taken in marriage with occult ceremonies. Therefore, where a sapinda or a sagotra girl is taken in marriage, she does not become a wife. " It is a clear that none of the reasons which justify the view that a breach of the first two rules in Ashvalayana 's text viz., the rules against marriage of a sapinda girl, or a sagotra girl, should have the consequence that the marriage should be invalid are present in the case of a breach of the third rule, which is against marrying a Viruddha Sambandha girl. It appears clear to us that Ashvalayana himself did not intend the rule against marrying a Viruddha Sambandha girl as a mandatory prohibition. This must have been even more clear to Nanda Pandit and so when extending Viruddha Sambandha to adoption on the % cry basis of Ashvalayanas rule against Viruddha Sambandha marriage, Nanda Pandit could not have but intended his rule against Viruddha Sambandha adoption as a mere recommendation and not a mandatory prohibition. Our attention was drawn to a decision of the Madras High Court in Minakshi vs Ramanada where the learned judges observed: (1) Mad. 49. 638 "In the case of marriage. , there are three prohibitions, viz., (1) The couple between whom marriage is proposed should not be sapindas; (2) They should not be sagotras; and (3) There should be no Viruddha Sambandha or contrary relationship as would render sexual connection between them incestuous." The real question which was before the Full Bench 'Was whether there can be valid adoption under the Hindu law if a legal marriage is not possible between the person for whom the adoption is made and the mother of the boy who is adopted, in her maiden state. In the case before the Full Bench, the adoptee 's mother was a sagotra of the adoptive father, and so, there could be no legal marriage between them. It was not necessary there "ore for the learned judges in the Minakshi 's case to consider whether the Viruddha Sambandha rule against marriage was mandatory or not. We are not aware of any decision in any of the High Courts where Nanda Pandit 's rule against Viruddha Sambandha adoption has been considered to be a mandatory, prohibition. For the reasons discussed above we are of opinion that this rule introduced by Wanda Pandit is only a recommendation and consequently it is of no avail to the appellant to show that the adoption of wife 's sister 's daughter 's son is invalid. Mr. Jha then tried to take advantage of the rule which has been accepted by almost all the High Courts except Bombay that there can be no valid legal adoption unless a legal marriage is possible between the person for whom the adoption is made and the mother of the boy who is adopted, in her maiden state, by urging that there can be no legal marriage between a person and, his wife 's sister 's daughter. Assuming for the present that it is no 630 longer open to challenge the correctness of this rule at least so far as the Banaras School is concerned, we are still of the opinion that this argument is of no avail, for the simple reason that we see no reason to think that there can be no legally valid marriage between a person and his wife 's mister 's daughter. For,the only argument in support of the contention, that there can be no such legal marriage between persons thus related, the learned counsel had to fall back upon Asvalayana 's Viruddha Sambandha rule. That however as we have already shown, is in our opinion only a recommendation and cannot support a proposition that a marriage in breach of the Viruddha Sambandha rule is invalid. An early as 1878 Dr. Gooroodas Banerjee (whose erudition equalled his orthodoxy) dealing with this question in his Tagore Law Lectures on the Hindu Law of Marriage and Stridhan observed thus (p. 64). "The prohibition by reason of affinity, which exsts in other systems, has no place in Hindu Law. But the prohibition of marriage with sapindas to some extent supplies its place and so did the prohibition of widow marriage. The Hindu Law, however, does not prohibit marriage with the wife 's sister, or even with her niece or her aunt." Dr. Jogendra Nath Bhattacharya in his Commentaries on Hindu Law (Third Edition) Vol. I, also stated after referring to what has been mentioned in Nirnaya Sindhu against marriage with the wife 's sister 's daughter (already quoted above): " 'Instances of marriage with wife 's sister 's daughter, and wife 's brother 's daughter, are also not unknown in Bengal though, Hindu sentiment is strong against such marriages. " The question was directly raised in Ragavendra Rau vs Jayaram Rau (1). Mr. Justice Subramania Ayyar and Mr. Justice Benson relying on Dr. Gooroodas Banerjee 's statement of the law (1) Mad. 640 and also on Syama Charan Sarkar 's VyavasthaDarpan, Dr. Bbattacharyya 's commentaries on Hindu Law and certain other text books held that marriage between a man and his wife 's sister 's daughter is valid. The learned judges pointed out that in South India at least there was little to 'indicate that such marriages are disapproved of "by the members of any section of the community." In our opinion a marriage of a Hindu with his wife 's sister 's daughter is not invalid in law even though it may not be liked by certain people. Mr. Jha 's second argument based on the rule which we have assumed to be not open to challenge for the purpose of this case that there can be no valid adoption unless a legal marriage is possible between the person for whom the adoption is made and the mother of the boy who is adopted in her maiden state, must therefore fail. We therefore hold that the High Court was right in its conclusion that the adoption of a wife 's sister 's daughter 's son is valid in law. The appeal is accordingly dismissed with costs. Appeal dismissed.

The appellant as reversioner sued for a declaration that the adoption of respondent 1 by respondent 2 to her deceased husband was invalid in law and respondent 1 acquired no right to the properties left by the husband of respondent 2. The parties were governed by the Banaras School of Mitakshal a Hindu law and respondent 1 was the sister 's daughter 's son of respondent 2. The question was whether a wife 's sister 's daughter 's son could 'be validly adopted to a person governed by the Banaras School of Mitakshara Hindu Law. The High Court answered it in the affirmative and dismissed the suit. Reliance wag placed on behalf of the appellant in this Court on Nanda Pandit 's Dattak Mimansa which specifically ,excluded a wife 's sister 's daughter 's son for the purpose of adoption on the ground of incongruous relationship (Viruddha Sambandha) as also on the text of Ashvalayana interdicting marriage with a sapinda, sagotra and viruddha sambandha girl such as a wife 's sister 's daughter on which the author of Dattak Mimansa had relied. It was contended that when a positive statement in the text was followed by a negative one, the latter 628 containing the prohibition must be held to be mandatory and that in any case since the prohibition against marriage to a sapinda or sagotra girl was mandatory, the prohibition against marriage to a Viruddha Sambandha girl must also be equally go. Held, that the contentions were without substance and must fail. Adoption of a wife 's sister 's daughter 's son is legally valid under the Banaras School of Mitakshara Hindu law. None of the reasons which rendered marriage to a sapinda or sagotra girl invalid were present in the case of a marriage to a Viruddha Sambandha girl and the rule against marrying a Viruddha Sambandha girl was not intended by its author to be mandatory. The extension of the rule of Viruddha Sambandha to adoption made by Nanda Pandit was not meant by him to be mandatory. Minakshi vs Ramanada, Mad. 49, distin guished. Held, further, that the marriage of a Hindu with his wife 's sister 's daughter is not invalid in Hindu law. Ragavendra Rau vs Jayaram Rau, Mad. 283, referred to. Case law reviewed.

Appeal No. 155 of 1961. Appeal by the special leave from the judgment and order dated January 5, 1959, of the Punjab High Court in Civil Writ Application No. 460 of 1957. I. M. Lal, and M. L. Aggarwal, for the appellant. section M. Sikri, Advocate General for the State of Punjab, N. section Bindra and P. D. Menon, for the respondents. March 7. The Judgment of the Court was delivered by MUDHOLKAR, J. This is an appeal by special leave against the judgment of the Punjab High Court dismissing the appellants petition under article 226 of the Constitution. 715 The appellant was appointed a qanungo in the former State of PEPSU in the year 1950. On December 1, 1953 he was appointed Assistant Consolidation Officer. Certain complaints having been received regarding tampering with official records he was suspended and an enquiry was held against him by the Revenue Secretary of PEPSU Government. As a result of that enquiry the Revenue Secretary dismissed him by order dated August 30, 1956, on the ground that the appellant was not above board and was not fit to be retained in service. ""his order was duly communicated to the appellant. Thereupon the appellant preferred an appeal before the State Government. It would appear that he had submitted an advance copy of his appeal to the Revenue Minister of PEPSU who called for the records of the case immediately. After perusing them he wrote on the file that the charges against the appellant were serious and that they were proved. He also observed that it was necessary to stop the evil with a strong band. He, however , expressed the opinion that as the appellant was a refugee and bad a family to support, his dismissal would be too hard and that instead of dismissing him outright he should be reverted to his original post of qanungo and warned that if be does not behave properly in future he will be dealt with severely. On the next day the State of PEPSU merged in the State of Punjab. According to the appellant the aforesaid remarks amount to an order of the State Government and that they were orally communicated to him by the Revenue Minister. This is denied on behalf of the State. It is, however, common ground that the aforesaid remarks or order, whatever they be, were never communicated officially to the appellant. After the merger of PEPSU with the State of 716 Punjab the file was put up before the Revenue Minister of Punjab, Mr. Darbara Singh. On December 1/4, 1956, Mr. Darbara Singh remarked on the file "Serious charges have been proved by the Revenue Secretary and Shri Bachhittar Singh was dismissed. I would like the Secretary i/c to discuss the case personally on 5th December, 1956. " Then on April 2/8, 1957 the Minister noted on the file "C.M. may kindly advise." With this remark the file went up before the Chief Minister, Punjab, who on April 16/18, 1957, passed an order, the concluding portion of which reads thus : "Having regard to the gravity of the charges proved against this official, I am definitely of the opinion that his dismissal from service is a correct punishment and no leniency should be shown to him merely on the ground of his being a displaced person or having a ' large family to support. In the circumstances, the order of dismissal should stand. " This order was communicated to the appellant on May 1, 1957. Thereafter he preferred petition under article 226 of the Constitution which, as already stated, was dismissed by the Punjab High Court. The validity of the order of the Revenue Secretary dismissing the appellant was not challenged before us. The point urged before us is that the order of the Revenue Minister of the PEPSU having reduced the punishment from dismissal to reversion, the Chief Minister of Punjab could not sit in review over that order and set it aside. Two grounds are urged in support of this point. The first is that the order of the Revenue Minister of PEPSU was the order of the State Government and was not open to review. The second ground is that in any case it was not within the competence of the Chief Minister of Punjab to deal with the matter 717 inasmuch as it pertained to the portfolio of the Revenue Minister. Before we ' deal with the grounds we may state that the High Court was of the opinion that proceedings taken against the appellant were made up of two parts : (a) the enquiry (which involved a decision of the question whether the allegations made against the appellant were true or not) and (b) taking action (i.e., in case the allegations were found to be true, whether the appellant should be punished or not and if so in what manner.) According to the High Court the first point involved a decision on the evidence and may in its nature be described as judicial while the latter was purely an administrative decision and that in so far as this was concerned there was no reason why the State Government was incompetent to change its decision "if it thought administratively advisable to do so". We cannot accept the view taken by the High Court regarding the nature of what it calls the second part of the proceedings. Departmental proceedings taken against a Government servant are not divisible in the sense in which the High Court understands them to be. There is just one continuous proceeding though there are two stages in it. The first is coming to a conclusion on the evidence as to whether the charges alleged against the Government servant are established or not and the second is reached only if it is found that they are so established. That stage deals with the action to be taken against the Government servant concerned. The High Court accepts that the first stage is a judicial proceeding and indeed it must be so because charges have to be framed, notice has to be given and the person concerned has to be given an opportunity of being heard. Even so far as the second stage is concerned article 311(2) of the Constitution requires a notice to be given to the person concerned ' as also an opportunity of being heard. 718 Therefore, this stage of the proceeding is no less judicial than the earlier one. Consequently any action decided to be taken against a Government servant found guilty of misconduct, is a judicial order and as such it cannot be varied at the will of the authority who is empowered to impose the punishment. Indeed, the very object with which notice is required to be given on the question of punishment is to ensure that it will be such as would be justified upon the charges established and upon the other attendant circumstances of the case. It is thus wholly erroneous to characterise the taking of action against a person found guilty of any chargo at a departmental enquiry as an administrative order. What we have now to consider is the effect of the note recorded by the Revenue Minister of PEPSU upon the file. We will assume for the purpose of this case that it is an order. Even so the question is whether it can be regarded as the order of the State Government which alone, as admitted by the appellant, was competent to hear and decide an appeal from the order of the Revenue Secretary. article 166(1) of the Constitution requires that all executive action of the Government of a State shall be expressed in the name of the Governor. Clause (2) of article 166 provides for the authentication of orders and other instruments made and executed in the name of the Governor. Clause (3) of that Article enables the Governor to make rules for the more convenient transaction of the business of the Government and for the allocation among the Ministers of the said business. What the appellant calls an order of the State Government is admittedly not expressed to be in the name of the Governor. But with that point we shall deal later. What we must first ascertain is whether the order of the Revenue Minister is an order of the State Government i.e., of the Governor. In this 719 connection we may refer to r. 25 of the Rules of Business of the Government of PEPSU which reads thus : "Except as otherwise provided by any other Rule, cases shall ordinarily be disposed of by or under the authority of the Minister incharge who may by means of standing orders give such directions as he thinks fit for the disposal of cases in the Department. Copies of such standing orders shall be sent to the Rajpramukh and the Chief Minister. " According to learned counsel for the appellant his appeal pertains to the department which was in charge of the Revenue Minister and, therefore, he could deal with it. His decision and order would according to him, be the decision and order of the State Government. On behalf of the State reliance was, however, placed on r. 34 which required cer tain classes of cases to be submitted to the Rajpramukh and the Chief Minister before the issue of orders. But it was conceded during the course of the argument that a case of the kind before us does not fall within that rule. No other provision bearing on the point having been brought to our notice we would, therefore, hold that the Revenue Minister could make an order on behalf ' of the State Government. The question, therefore, is whether he did in fact make such an order. Merely writing something on the file does not amount to an order. Before something amounts to an order of the State Government two things are necessary. The order has to be expressed in the name of the Governor as required by cl. (1) of article 166 and then it has to be communicated. As already indicated, no formal order modifying the decision of the Revenue Secretary was ever made. Until such an order is drawn up the State Government cannot, in our opinion, be 720 regarded as bound by what was stated in the file. As along as the matter rested with him the Revenue Minister could well score out his remarks or minutes on the file and write fresh ones. The business of State is a complicated one and has necessarily to be conducted through the agency of a large number of officials and authorities. The constitution, therefore, requires and so did the Rules of Business framed by the Rajpramukh of PEPSU provide, that the action must be taken by the authority concerned in the name of the Raj pramukh. It is not till this formality is observed that the action can be regarded as that of the State or here, by the Rajpramukh. We may further observe that, constitutionally speaking, the Minister is no more than an adviser and that the head of the State, the Governor or Rajpramukh,* is to act with the aid and advice of his Council of Ministers. Therefore, until such advice is accepted by the Governor whatever the Minister or the Council of Ministers may say in regard to a particular matter does not become the action of the State until the advice of the Council of Ministers is accepted or deemed to be accepted by the Head of the State. Indeed, it is possible that after expressing one opinion about a particular matter at a particular stage a Minister or the Council of Ministers may express quite a different opinion, one which may be completely opposed to the earlier opinion. Which of them can be regarded as the "order ' of the State Government? Therefore to make the opinion amount to a decision of the Government it must be communicated to the person concerned. In this connection we may quote the following from the judgment of this Court in the State of Punjab vs Sodhi Sukhdev Singh (1). "Mr. Gopal Singh attempted to argue that before the final order was passed the Council *Till the abolition of that office by the Amendment of the Constitution in 1956. (1) ; 409. 721 of Ministers had decided to accept the respon dent 's representation and to reinstate him, and that, according to him, the respondent seeks to prove by calling the two original orders. We are unable to understand this argument. Even if the Council of Ministers had provisionally decided to reinstate the respondent that would not prevent the Council from reconsidering the matter and coming to a contrary conclusion later on, until a final decision is reached by them and is communica ted to the Rajpramukh in the form of advice and acted upon by him by issuing an order in that behalf to the respondent. " Thus it is of the essence that the order has to be communicated to the person who would be affected by that order before the State and that person can be bound by that order. For, until the order is communicated to the person affected by it, it would be open to the Council of Ministers to consider the matter over and over again and, therefore, till its communication the order cannot be regarded as anything more than provisional in character. We are, therefore, of the opinion that the remarks or the order of the Revenue Minister, PEPSU are of no avail to the appellant. Now as regards the next contention, Learned counsel for the appellant contends that since his appeal was not decided by the Revenue Minister of Punjab, Mr. Darbara Singh but by the Chief Minister Mr. Pratap Singh Kairon, who bad no jurisdiction to deal with it, the appeal must be deemed to be still pending. In this connection he relied upon r. 18 of the Rules of Business framed by the Governor of Punjab which corresponds to r. 25 of the PEPSU rules, which reads thus: " 'Except as otherwise provided by any other Rule., cases shall ordinarily be disposed 722 of by or under the authority of the Minister in charge who may, by means of standing orders give such directions as he thinks fit for the disposal of cases in the Department. Copies of such standing orders shall be sent to the Chief Minister and the Governor. " Now, unquestionably the matter here did pertain to the portfolio of the Revenue Minister. But it was he himself who, after seeing the file submitted it to the Chief Minister for advice. Learned counsel, however, contends that the Chief Minister could, therefore, only give him advice and not asurp the jurisdiction of the Revenue Minister and decide the case himself. But this argument ignores r.28 (1) of the Punjab Rules of Business, the relevant portions of which run thus: "28 (1) The following classes of cases shall be submitted to the Chief Minister before the issue of orders : x x x (ii) Cases raising questions of policy and Cases of administrative importance not already covered by the Schedule. x x x (vii) Proposals, for the prosecutions, dis missal, removal or compulsory retirement of any gazetted officer. x x x (xix) Such other cases or classes of cases as the chief Minister may consider necessary. The learned Advocate General contends that the case would be covered by every one of these clauses. In our opinion, cl.(vii) cannot assist him because it is not the contention of the State that the appellant is a gazetted officer. We, however, think that 723 cl. (ii) would certainly entitle the Chief Minister to paw an order of the kind which he has made here. The question to be considered was whether though grave charges had been proved against an official he should be removed from service forthwith or merely reduced in rank. That unquestionably raises a question of policy which would affect many cases all and the departments of the State The Chief Minister would, therefore, have been within his rights to call up the file of his own accord and pass orders thereon. Of course, the rule does not say that the Chief Minister would be entitled to pass orders but when it says that he is entitled to call for the file before the issue of orders it clearly implies that he has a right to interfere and make such order as he thinks appropriate. Finally there is cl. (xix) which confers a wide discretion upon the Chief Minister to call for any file and deal with it himself. Apart from that we may refer to r. 4 of the Rules of Business of the Punjab Government, which reads thus : "The Council shall be collectively responsible for all executive orders issued in the name of the Governor in accordance with these Rules whether such orders are authorised by an individual Minister on a matter pertaining to his portfolio or as the result of discussion it a meeting of the Council, or howsoever otherwise." Thus the order passed by the Chief Minister even though it is on a matter pertaining to the portfolio of the Revenue Minister, will be deemed to be an order of the Council of Ministers. So deemed its contents would be the Chief Minister 's advice to the Governor, for which the Council of Ministers would be collectively responsible. The action taken thereon in pursuance of r. 8 of the Rules of Business made by the Governor under article 166(3) of the Constitution 724 would then be the action of the Government. Here one (if the Under Secretaries to the Government of Punjab informed the appellant by his letter dated May, 1, 1957 that his representation "had been considered and rejected", evidently by the State Government. This would show that appropriate action had been taken under the relevant rule. The appeal is thus without substance and is dismissed. In view of the fact that the appellant is a displaced person with heavy responsibilities and with limited or possibly hardly any means we direct that the costs shall be borne by the parties concerned. Appeal dismissed.

The appellant was appointed a qanungo in Pepsu and latter as Assistant Consolidation Officer. Complaints having been received against him, an enquiry was held as a result of which he was dismissed by the Revenue Secretary. Against this order he preferred an appeal to the State Government. The Revenue Minister Pepsu wrote on the file 'chat dismissal would be too hard and instead he should be reverted as qanungo but no written order to that effect was served upon the appellant. After merger of Pepsu with Punjab, the Revenue Minister Punjab sent up the file to the Chief Minister with the remarks "C.M. may kindly advise". The Chief Minister passed the order confirming the dismissal. and the order was duly communicated to the appellant. The appellant challenged the order of the Chief Minister Punjab on the ground that the Chief Minister Punjab could not sit in review on the order of the Revenue Minister Pepsu and that the Chief Minister was not competent to deal with the matter as it pertained to the portfolio of the Revenue Minister. Held, that the order of the Revenue Minister Pepsu could not amount to an order by the State Government unless it was expressed in the name of Rajpramukh as required by article 166(1) of the Constitution and was then communicated to the appellant. Until the order was so communicated it was only of a provisional character and could be reconsidered over and ever again. Before communication the order was binding neither on the appellant nor on the State Government. State of Punjab vs Sodhi Sukdev Singh A.I.R. (1961) 2 S.C.R. 3 71 referred to. 714 Held, further, that the Chief Minister Punjab was competent to deal with the appeal and to pass the order which he did. Under r. 25 of the Rules of Business of the Punjab Government the matter undoubtedly related to the portfolio of the Revenue Minister. But since tinder r. 28(1)(ii) and (xix) which provide that cases involving questions of policy and cases of administrative importance and such other cases or classes of cases as the Chief Minister may consider necessary shall be referred to the Chief Minister, the case was properly referred to the Chief Minister. Under r. 4 the order passed by the Chief Minister, even though it pertained to the portfolio of the Revenue Minister, would be deemed to be an order of the Council of Ministers. It would be the Chief Ministers advice to the Governor, for which the Council of Ministers Would be collectively responsible and action taken thereon would be the action of the Government. Departmental proceedings cannot be divided into two parts : (i) enquiry and (ii) taking of action ; there is one conti nuous proceeding though there are two stages. Any action decided to be taken against a public servant found guilty misconduct is a judicial order and as such it cannot be varied at the will of the authority.

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

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

y of the view that the almost unanimous opinion of experts is that after the age of 15, bulls. bullocks and buffaloes are no longer useful for breeding, draught and other purposes and whatever little use they may have then is greatly offset by the economic disadvantages of feeding and maintaining unserviceable cattle disadvantages to which we had referred in much greater detail in Md. Hanif Quareshi 's case (1). Section 3 of the Bihar Act in so far as it has increased the age limit to 25 in respect of bulls, bullocks and she buffaloes, imposes an unreasonable restriction on the fundamental right of the petitioners, a restriction moreover which cannot be said to be in (1) ; 623 the interests of the general public, and to that extent it is void. We may here repeat what we said in Chintaman Rao vs The State of Madhya Pradesh (1): "The phrase 'reasonable restriction ' connotes that the limitation imposed on a person in enjoyment of the right should not be arbitrary or of an excessive nature, beyond what is required in the interests of the public. The word 'reasonable ' implies intelligent care and deliberation, that is, the choice of a course which reason dictates. Legislation which arbitrarily or excessively invades the right cannot be said to contain the quality of reasonableness and unless it strikes a proper balance between the freedom guaranteed in article 19(1)(g) and the social control permitted by clause (6) of article 19, it must be held to be wanting in that quality. " As to r. 3 the grievances of the petitioners are these. Under the rule the prescribed authority for the purpose of section 3 of the Act consists of the Veterinary Officer and the Chairman or Chief Officer of a District Board, Municipality etc. Unless both of them concur, no certificate for slaughter can be granted. It is pointed out that the Chairman or Chief Officer would be a layman not in a position to judge the age or usefulness of cattle. The result would be that the animal in respect of which a certificate is required may have to be shown to the Veterinary Officer as also the Chairman or Chief Officer, who may not be staying at the same place as the Veterinary Officer. If the two differ, the matter has to be referred to the Sub divisional Animal Husbandry Officer. This procedure, it is contended, will involve the expenditure of so much money and time that it will not be worthwhile for the petitioners to ask for a certificate, or having got a certificate, to slaughter the animal. An animal which is above 15 or which has become useless generally costs much less than a young, serviceable animal. If the petitioners have to incur all the expenditure which the procedure laid down by r. 3 must necessarily cost them, then they must close down their trade. As to the right of appeal from an order refusing to grant a (1) ; ,763. 624 certificate, it is contended that that right is also illusory for all practical purposes. To take the animal to the Deputy Director of Animal Husbandry or the District Animal Husbandry Officer or the Sub divi sional Animal Husbandry Officer, as the case may be, and to keep and feed the animal for the period of the appeal and its hearing will cost more than the price of the animal itself. We consider that these grievances of the petitioners have substance, and judged from the practical point of view, the provisions of r. 3 impose disproportionate restrictions on their right. It is difficult to understand why the Veterinary Officer, who has the necessary technical knowledge, cannot be trusted to give the certificate and why it should be necessary to resort to a complicated procedure to resolve a possible difference of opinion between two officers, later followed by a still more expensive appeal. We, therefore, hold r. 3 also to be bad in so far as it imposes disproportionate restrictions indicated above, on the right of the petitioners. (2) We now proceed to consider the Uttar Pradesh Prevention of Cow Slaughter (Amendment) Act, 1958. After the decision of this Court in Md. Hanif Quareshi vs The State of Bihar (1) an Ordinance was passed called the Uttar Pradesh Prevention of Cow Slaughter (Amendment) Ordinance, 1958. This Ordinance was later repealed and replaced by the Act. The petitioners say that in the Bill as originally drafted the age limit below which slaughter was not permissible was put at 15 years; but the Select Committee increased it to 20 years. It will probably be best, for clearness sake, to set forth not the whole provisions of the Act, for that would be too lengthy, but those which form most directly the subject matter on which the controversy turns. Section 3 of the Act reads (omitting portions not relevant for our purpose) "section 3(1) Except as hereinafter provided, no person shall slaughter or cause to be slaughtered or offer or cause to be offered for slaughter (a). . . . . . . (1) ; 625 (b) a bull or bullock, unless he has obtained in respect thereof a certificate in writing, from the competent authority of the area in which the bull or bullock is to be slaughtered, certifying that it is fit for slaughter. (2) No bull or bullock, in respect of which a certificate has been issued under sub section (1)(b) shall be ' slaughtered at any place other than the place indicated in the certificate or within twenty days of the date of issue of the certificate. (3) A certificate under sub section (1)(b) shall be issued by the competent authority, only after it has, for reasons to be recorded in writing, certified that(a) the bull or bullock is over the age of twenty years; and (b) in the case of a bull, it has become permanently unfit and unserviceable for the purpose of breeding and, in the case of a bullock, it has become permanently unfit and unserviceable for the purposes of draught and any kind of agricultural operation: Provided that the permanent unfitness or unserviceability has not been caused deliberately. (4) The competent authority shall, before issuing the certificate under sub section (3) or refusing to issue the same, record its order in writing. Any person aggrieved by the order of the competent authority, under this section, may, within twenty days of the date of the order, appeal against it to the State Government, which may pass such orders thereon as it may deem fit. (5) The State Government may, at any time, for the purposes of satisfying itself as to the legality or propriety of the action taken under this section, call for and examine the record of any case and may pass such orders thereon as it may deem fit. (6) Subject to the provisions herein contained any action taken under this section, shall be final and conclusive and shall not be called in question. " On behalf of the petitioners it has been argued that section 3 imposes a number of unreasonable restrictions. Firstly, it is urged that the age limit with regard to bulls or bullocks is put too high, viz. at 20 years. This is an 626 aspect which we have already considered in relation to the Bihar Act. What we have said about the age s limit in that connexion applies equally to the Uttar Pradesh Act. The 8th Live stock Census, 1956 shows that in Uttar Pradesh bulls and bullocks over 3 years of age, not in use for breeding or work, numbered as many as 126,201 in 1956 as compared to 162,746 in 1951. The Municipal Manual, Uttar Pradesh, Vol. 1, contains a direction that for slaughter of animals, bullocks and male buffaloes in good state of health below ten years of age should be included. Secondly, it is pointed out that not being content with fixing an unreasonably high age limit, the impugned provision imposes a double restriction. It says that the animal must be over twenty years in age and must also be permanently unfit and unserviceable; and in the case of a bullock, the unfitness must be for "any kind of agricultural operation" and not merely for draught purposes. The result of this double restriction, it is stated, is that even if the animal is permanently unserviceable and unfit at an earlier age, it cannot be slaughtered unless it is over twenty years in age. Before a certificate can be given, the animal must fulfil two conditions as to (1) age and (2) permanent unfitness. We consider this to be a demonstrably unreasonable restriction. In Md. Hanif Quareshi 's case (1) this Court had said that a total ban on the slaughter of bulls and bullocks after they had ceased to be capable of breeding or working as draught animals was not in the interests of the general public. Yet this is exactly what the impugned provision does by imposing a double restriction. It lays down that even if the animal is permanently unserviceable, no certificate can be given unless it is more than 20 years in age. The restriction will in effect put an end to the trade of the petitioners. Thirdly, the impugned provision provides (1) that the animal shall not be slaughtered within 20 days of the date of the issue of the certificate and (2) that any person aggrieved by the order of the competent authority may appeal to the State Government within 20 days. It is to be noted that the right of appeal is not (1) 627 confined to a refusal to grant a certificate as in the Bihar Act, but the right is given to any person aggrieved by the order of the competent authority. In other words, even when a certificate is given, any person, even a member of the public, who feels aggrieved by it may prefer an appeal and hold up the slaughter of the animal for a long time. From the practical point of view these restrictions really put a total ban on the slaughter of bulls and bullocks even after they have ceased to be useful, and we must hold, following our decision in Md. Hanif Quareshi 's case (1) that section 3 of the Uttar Pradesh Act in so far as it imposes unreasonable restrictions on the right of the petitioners as to slaughter of bulls and bullocks infringes the fundamental right of the petitioners and is to that extent void. (3) Now, we come to the Madhya Pradesh Act. Several provisions of this Act have been challenged before us as imposing unreasonable restrictions on the fundamental right of the petitioners. Section 4 deals with prohibition of slaughter of agricultural cattle. The expression 'agricultural cattle ' means an animal specified in the schedule: it means cows of all ages; calves of cows and of she buffaloes; bulls; bullocks; and male and female buffaloes. As we have stated earlier, we are concerned in these cases with the validity of the restrictions placed on the slaughter of bulls, bullocks and buffaloes. Now, section 4 is in these terms: "section 4(1) Notwithstanding anything contained in any other law for the time being in force or in any usage or custom to the contrary, no person shall slaughter or cause to be slaughtered or offer or cause to be offered, for slaughter (a) cows, calves of cows, or calves of she buffaloes, or (b) any other agricultural cattle unless he has obtained in respect of such cattle a certificate in writing issued by the Competent Authority for the area in which the cattle is to be slaughtered that the cattle is fit for slaughter. (1) [1959] S.C.R.29. 628 (2) No certificate under clause (b) of sub section (1) shall be issued by the Competent Authority .unless the Veterinary Officer after examining the cattle certifies that (a) the cattle is over twenty years of age and is unfit for work or breeding or has become permanently incapacitated from work or breeding due to age, injury, deformity or an incurable disease; and (b) the cattle is not suffering from any disease which makes its meat unwholesome for human consumption. (3) The Competent Authority shall, before issuing or refusing to issue a certificate under this section, record its order in writing. Any person aggrieved by the order of the Competent Authority under this section, may, within ten days of the date of the order, prefer an appeal against such order to the Collector of the district or such other officer as may, by notification, be authorised in this behalf by the State Government, and the Collector or such other officer may pass such orders thereon as he thinks fit. (4) Subject to the orders passed in appeal, if any, under sub section (3), the order of the Competent Authority shall be final and shall not be called in question in any Court. " Section 5 places a restriction as to the place and time for slaughter and the objection taken before us relates to the time rather than to the place of slaughter. It says in effect that no cattle in respect of which a certificate has been issued under section 4 shall be slaughtered within ten days of the date of issue of the certificate and where an appeal is preferred against the grant of such certificate, till the time such appeal is disposed of. The provision of appeal is contained in sub section (3) of section 4 of the Act which we have quoted earlier. That sub section lays down that any person aggrieved by the order of the Competent Authority, may, within ten days of the date of the order, prefer an appeal against the order to the Collector of the district or such other officer as may, by notification, be authorised in this behalf by the State Government. 629 Section 6 imposes a restriction on the transport of agricultural cattle for slaughter and reads: "section 6. No person shall transport or offer for transport or cause to be transported any agricultural cattle from any place within the State to any place outside the State, for the purpose of its slaughter in contravention of the provisions of this Act or with the knowledge that it will be or is likely to be, so slaughtered. " Section 7 prohibits the sale, purchase or disposal otherwise of certain kinds of animals. It reads . "section 7. No person shall purchase, sell or otherwise dispose of or offer to purchase, sell or otherwise dispose of or cause to be purchased, sold or otherwise disposed of cows, calves of cows or calves of shebuffaloes for slaughter or knowing or having reason to believe that such cattle shall be slaughtered. " Section 8 relates to possession of flesh of agricultural cattle and is in these terms: "section 8. Notwithstanding anything contained in any other law for the time being in force, no person shall have in his possession flesh of any agricultural cattle slaughtered in contravention of the provisions of this Act. " Section 10 imposes a penalty for a contravention of section 4(1)(a) and section 11 imposes penalty for a contravention of any of the other provisions of the Act. On behalf of the petitioners it has been pointed out, and rightly in our opinion, that cl. (a) of sub section (2) of section 4 of the Act imposes an unreasonable restriction on the right of the petitioners. That clause in its first part lays down that the cattle (other than cows and calves) must be over 20 years of age and must also be unfit for work or breeding; and in the second part it says, "or has become permanently incapacitated from work or breeding due to age, injury, deformity or an incurable disease. " It is a little difficult to understand why the two parts are juxtaposed in the section. In any view the restriction that the animal must be over 20 years of age and also unfit for work or breeding is an excessive or unreasonable restriction as we have 80 630 pointed out with regard to a similar provision in the Uttar Pradesh Act. The second part of the clause would not be open to any objection, if it stood by itself. If, however, it has to be combined with the agelimit mentioned in the first part of the clause, it will again be open to the same objection; if the animal is to be over 20 years of age and also permanently incapacitated from work or breeding etc. ,then the agelimit is really meaningless. Then, the expression 'due to age ' in the second part of the clause also loses its meaning. It seems to us that cl. (a) of sub section (2) of section 4 of the Act as drafted is bad because it imposes a disproportionate restriction on the slaughter of bulls, bullocks and buffaloes it is a restriction excessive in nature and not in the interests of the general public. The test laid down is not merely permanent incapacity or unfitness for work or breeding but the test is something more than that, a combination of age and unfitness ' Learned Counsel for the petitioners has placed before us an observation contained in a reply made by the Deputy Minister in the course of the debate on the Bill in the Madhya Pradesh Assembly (see Madhya Pradesh Assembly Proceedings, Vol. 5 Serial No. 34 dated April 14, 1959, page 3201). He said that the age fixed was very much higher than the one to which any animal survived. This observation has been placed before us not with a view to an interpretation of the section, but to show what opinion was held by the Deputy Minister as to the proper agelimit. On behalf of the respondent State our attention has been drawn to a book called The Miracle of Life (Home Library Club) in which there is a statement that oxen, given good conditions, live about 40 years. Our attention has also been drawn to certain extracts from a Hindi book called Godhan by Girish Chandra Chakravarti in which there are statements to the effect that cows and bullocks may live up to 20 or 25 years. This is an aspect of the case with which we have already dealt. The question before us is not the maximum age upto which bulls, bullocks and buffaloes may live in rare cases. The question before us is what is their average longevity and at what age 631 they become useless. On this question we think that the opinion is almost unanimous, and the opinion which the Deputy Minister expressed was not wrong. Section 5 in so far as it imposes a restriction as to the time for slaughter is again open to the same objection as has been discussed by us with regard to a similar provision in the Uttar Pradesh Act. A right of appeal is given to any person aggrieved by the order. In other words, a member of the public, if he feels aggrieved by the order granting a certificate for slaughter, may prefer an appeal and hold up for a long time the slaughter of the animal. We have pointed out that for all practical purposes such a restriction will really put an end to the trade of the petitioners and we are unable to accept a restriction of this kind as a reasonable restriction within the meaning of cl. (6) of article 19 of the Constitution. Section 6 standing by itself, we think, is not open to any serious objection. It is ancillary in nature and tries to give effect to the provision of the Act prohibiting slaughter of cattle in contravention of the Act. Section 7 relates to the prohibition of sale, purchase etc., of cows and calves and inasmuch as a total ban on the slaughter of cows and calves is valid, no objection can be taken to section 7 of the Act. It merely seeks to effectuate the total ban on the slaughter of cows and calves (both of cows and she buffaloes). Section 8 is also ancillary in character and if the other provisions are valid no objection can be taken to the provisions of section 8. Sections 10 and 11 impose penalties and their validity cannot be seriously disputed. However, we must say a few words about section 12 of the Act which has also been challenged before us. Section 12 is in these terms: "section 12. In any trial for an offence punishable under section 11 for contravention of the provision of sections 5, 6 or 7 of this Act the burden of proving that the slaughter, transport or sale of agricultural cattle was not in contravention of the provisions of this Act shall be on the accused. " The argument is that section 12 infringes the fundamental 632 right of the petitioners inasmuch as it puts the burden of proof on an accused person not only for his own knowledge or intention but for the knowledge or intention of other persons. We do not think that this contention is correct. The accused person, so far as sections 5 and 7 are concerned, must be the person who has slaughtered the animal or who has purchased, sold or otherwise disposed of the animal etc. Therefore, the only question will be his knowledge and the legislature was competent to place the burden of proof on him. So far as section 6 is concerned, it specifically refers to the knowledge of the person who has transported or offered for transport or caused to be transported any agricultural cattles from any place within the State to any place outside the State. Therefore, when the section talks of knowledge, it talks of the knowledge of that person who has transported or offered for transport etc. The knowledge of no other person comes into the purview of section 6. We are, therefore, ' of the view that section 12 is not invalid on the ground sug gested by the petitioners. Therefore, the result of our examination of the various provisions of the Act is that the impugned provisions in cl. (a) of sub section (2) of section 4, in sub section (3) of section 4 relating to the right of appeal by any person aggrieved by the order, and in section 5 relating to the time of slaughter, impose unreasonable and disproportionate restrictions which must be held to be unconstitutional. As to the Madhya Pradesh Agricultural Cattle Preservation Rules, r. 3 says "that an application for a certificate under section 4 shall be made to the competent authority," and r. 4 says that on receipt of the application, the competent authority shall by an order direct the person keeping the animal to submit it for examination by the Veterinary Officer Rule 5 reproduces the provisions of cls. (a) and (b) of sub section (2) of section 4 and in so far as we have held that the provision in el. (a) of sub section (2) of section 4 is unconstitutional, the rule must also fall with it. There is one other aspect of these cases which has been emphasized before us, to which a reference must 633 now be made. It is open to the legislature to enact ancillary provisions to give effect to the main object of the Act, namely, the prevention of slaughter of animals like bulls, bullocks or buffaloes which are still useful for the purposes for which they are generally used. It is pointed out that acts innocent in themselves may be prohibited and the restrictions in that regard would be reasonable, if the same were necessary to secure efficient enforcement of valid provisions. For example, it is open to the legislature, if it feels it necessary, in order to reduce the possibilities of evasion to a minimum, to enact provisions which would give effect to the main object of the legislation. We have not ignored this aspect and have kept in mind the undisputed right of the legislature to decide what provisions are necessary to give effect to the main object of the legislation. In these cases the petitioners have complained that the main object of the impugned provisions is not the prohibition of slaughter of animals which are still useful; the impugned provisions as they are worded really put a total ban on the slaughter of bulls, bullocks and buffaloes and for all practical purposes they put a stop to the profession and trade of the petitioners. We have held that this complaint is justified in respect of the main provisions in the three Acts. We, therefore, allow the three writ petitions and direct, as we directed in Md. Hanif Quareshi 's case (1) the respondent States not to enforce the Acts or the rules made thereunder in so far as they have been declared void by us. The petitioners will be entitled to their costs of the hearing in this Court. Petitions allowed.

In order to put the sugar industry on a stable footing, for which it was necessary to develop the cane area, the Ruler of the erstwhile Gwalior State by an order dated 27 7 1946 sanctioned the levy of cess of one anna per maund on all sugar cane purchased by the respondent company. When the Government of Madhya Bharat, which was the successor state of the former Gwalior State, made a demand for payment of the cess, the respondent filed a petition before the High Court of Madhya ,Bharat challenging the legality of the levy on the grounds (1) that the order dated 27 7 1946 was only an executive order and not a law under article 265 of the Constitution of India and that, therefore, there was no authority for the imposition of the cess after January 26, 1950, and (2) that the levy was discriminatory and violated article 14 inasmuch as while the respondent was made liable to pay the cess the other sugar factories in the State were exempt. It was found that at the time when cess was first levied there was no sugar factory in existence in the Gwalior State other than that of the respondent. Held, that (i) the Ruler of an Indian State was an absolute monarch in which there was no constitutional limitation to act in any manner he liked, he being the supreme legislature, the supreme judiciary and the supreme head of the executive. I Consequently, the order dated 27 7 1946 issued by the Ruler of Gwalior State amounted to a law enacted by him and became an existing law under article 372 of the Constitution of India. The levy of cess was therefore by authority of law within the meaning of article 265; Madhaorao Phalke vs The State of Madhya Bharat, ; , followed. (2) the levy of cess did not contravene article 14 because (a) the object was cane development in the particular area and a geographical classification based upon historical factors was a permissible mode of classification, and (b) a tax could not be struck down as discriminatory unless it was found that it was imposed with a deliberate intention of differentiating between 620 (ii) where the order is passed by the Sub divisional Animal Husbandry Officer, under sub rule (5), to the District Animal Husbandry Officer and (iii) where the order is passed by the authority prescribed under sub rule (1) to the Sub divisional Animal Husbandry Officer, if there is one; if not, to the District Animal Husbandry Officer; (b) The appeal shall not be decided against the appellant unless he has been given a reasonable opportunity of being heard. " The argument on behalf of the petitioners is that they are "Kassais" by profession and they earn their living by slaughtering cattle only (not goats or sheep which are slaughtered by "Chiks"); that they have the fundamental right to carry on their profession and trade; and that section 3 of the Act read with r. 3 imposes unreasonable restrictions restrictions not in the interests of the general public on their fundamental right and therefore they are not saved by cl. (6) of article 19 of the Constitution. Some of these arguments were considered by this Court in Md. Hanif Quareshi vs The State of Bihar (1) and it was pointed out that the test of reasonableness 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. It referred to the decision in State of Madras vs V. G. Row (2) and repeated what was said therein that "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 the time, should all enter into the judicial verdict." 'Another consideration which has to be kept in mind is that "the legislature is the best judge of what is good for the community,. by whose suffrage it comes into existence. . . . (See The State of Bihar vs Maharajadhiraja Sir Kameshwar Singh of Darbhanga (3)). But the ultimate responsibility for determining the validity of the law must rest with the (1) (2) ; (3) 621 Court and the Court must not shirk that solemn duty cast on it by the Constitution. We must, therefore, approach the problem before us in the light of the principles laid down by this Court. The most pertinent question is having regard to all the relevant circumstances, is the age of 25 years laid down in section 3 a reasonable restriction on the right of the petitioners in the interests of the general public ? We are unable to say that it is. Apart from the affidavits made on behalf of the petitioners and the respondent State, a large volume of authoritative and expert opinion has been placed before us which shows beyond any doubt that a bull, bullock or she buffalo does not remain useful after 14 or 15 years and only a few of them live up to the age of 25. In the Report of the Cattle Preservation and Development Committee, published by the Ministry of Agriculture, it is recommended by the Committee that the slaughter of animals over 14 years of age and unfit for work as also animals of any age permanently unable to work owing to injury or deformity, should be allowed. In the Report on the Marketing of Meat in India (published by the Ministry of Food and Agriculture) there is a reference to a draft Bill circulated by the Ministry of Agriculture (page 112 of the Report) which contains a clause that animals over 14 years of age and unfit for work may be slaughtered on a certificate from a Veterinary Officer. In the Report on the Marketing of Cattle in India, again published by the Ministry of Food and Agriculture, occurs the following passage as to the price of animals with reference to their age: "Young draught animals up to the age of 4 years being raw and untrained fetch comparatively low prices. Between 4 and 8 years of age, the animals are in the prime of their youth and tender best service, and fetch maximum prices. From the 8th year onwards old age sets in, and a graded decline is observed in their capacity to work and consequently prices depreciate considerably." . In a Food and Agricultural Organisation study of cattle in India and Pakistan (Zebu Cattle of India and 79 622 Pakistan, page 94) it is stated that the active breeding life of a bull is estimated to be about 10 years. In Black 's Veterinary Dictionary (edited by W. C. Miller and G. P. West, fifth edition) it is stated that pedigree ,bulls may reach 12 or 14 years of age before being discarded; and cattle seldom live longer than 15 or 16 years, and when they do, their age is usually of no immediate importance. In another publication of the Ministry of Agriculture called 'Problems of Cattle Insurance ' under Indian conditions, it is stated that the life of cattle is comparatively much shorter, the maximum age being only about 15 years. There is an interesting chart relating to the determination of age in cattle in a publication called 'Cattle Development in Uttar Pradesh ' by R. L. Kaura, Director of Animal Husbandry; that chart shows that at II years incisors appear smaller due to wearing out; at 12 years space appears between the teeth, and after 12 teeth wear out constantly and roots remain far apart from one another. As against all this expert opinion the respondent State has relied on the chart embodying some useful data about domestic animals, prepared by Major A. C. Aggarwala, Director of Veterinary Services, Punjab, and R. R. Gulati, Superintendent, Veterinary Department, Jullandur, which shows the sterility age of a buffalo at 15 and average age at 25, and of a cow sterility at 15 and 16 years and average life 22 years.

minal Appeal No. 126 of 1959. Appeal by special leave from the judgment and order dated June 19, 1959, of the Punjab High Court in Criminal Revision No. 144 of 1959. R. L. Kohli, for the appellant. G. C. Mathur and P. D. Menon, for the respondent. March 6. The Judgment of the Court was delivered by KAPUR, J. This is an appeal by special leave against the judgment and order of the High Court of the Punjab and raises the constitutionality of s.178A of the (Act 8 of 1878), which has been held by this Court to be constitutional in the Collector of Castoms, Madras vs Nathella Sampathu Chetty(1). At the time, of arguments before us a further point was raised that in order that s.178A of the may become applicable, the prosecution must further prove that the goods which were sought to be affected by the order of the Customs Officer were goods of foreign origin and there must be evidence in support of the reasonableness of the belief of the Customs Officer that the goods were smuggled goods. The question now sought to be raised was not agitated in any of the courts below. The appellant on February 11, 1958, when he was sitting in a third class compartment of the Amritsa Kalka train standing on Platform No. 5 of the Amrsar Railway Station, was searched by a Customs Official and some bars of gold were found tied round his waist. These gold bars were seized and a recovery memo wits prepared, Out of these gold (1) ; 615 bars four were of base metal and the rest were of pure gold some bearing the stamp of Johmon Mathey & Co. Ltd., 999 10 tolas and 2 1/4 bars bore marks of N.M. Rothschild & Sons 10 tolas (990 0). No permit from the the Reserve Bank to import this gold was produced by the appellant. Under the Foreign Exchange Regulation Act, 1917, the importation of gold without such permit is prohibited and such contravention is punishable under s.23 A of the said Act read with s.167(81) of the . The appellant was prosecuted under s.23A of the Foreign Exchange Regulation Act and 167(81) of the and his defence was that he was not in possession of the gold bars which were taken from an attache case left by a stranger under the seat where he (the appellant) was sitting. The Additional District Magistrate held the offence to be proved and convicted the appellant of the offence and sentenced him to one year 's rigorous imprison ment. An appeal to the Sessions Judge resulted in the reduction of the sentence to 8 months ' rigorous imprisonment. On revision to the High Court the sentence was reduced to six months ' rigorous imprisonment. The appellant has come in appeal by special leave. The trial court accepted the testimony of the Customs Officials and held that the defence of the appellant was false and that gold worth Rs. 14,000/ was found in his possession. The learned Sessions Judge in appeal also accepted the testimony of the Customs Officials and held the defence to be false and came to the conclusion that the gold was found in possession of the appellant. In the High Court the same plea was taken and was rejected. For the first time in this Court it is contended that before the presumption under s.178A can be made applicable, it must be proved by the prosecution that the goods were of foreign origin, i.e. had beep 616 imported from abroad and only then does the presumption under section 178A arise which relates only to the question of Customs duty having been paid. In other words the contention comes to this that the prosecution must first prove that the goods in dispute in a particular case have been imported from a foreign country and once that is proved the onus then will be on the person in whose possession the goods are found that he had paid the Customs duty. Apart from the fact that this question has never been raised, that is not the effect of s.178A of the which provides: "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, cigaretters 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". Two Customs officers appeared as witnesses, Inspector Satnam Singh and Deputy Superintendent A.N. Kapur, the former is an Inspector of Land Customs and the latter a Deputy Superintendent of Customs. There is nothing to indicate in their cross examination that the officers did not have a reasonable belief that the goods were smuggled goods and the question that the officers did not have reasonable belief is not suggested either from the cross examination of these witnesses of from the findings 617 of the courts below. Even in his statement of case it is contended that the mere existence of stamp of foreign companies on gold does not necessarily prove that the gold is of foreign origin. It might be put on spurious gold which may be of Indian origin. In our opinion apart from the fact that this question has not been raised, it is quite clear that what s.178A of the provides is that when the goods are seized in the reasonable belief that they are smuggled goods then the burden of proving that they are not smuggled goods is on the person from whose possession the goods are seized. The onus is on him to show that the goods are not smuggled, that is, not of foreign origin on which duty is not paid. The onus is not on the prosecution to show that the goods are not, of Indian origin. That appears to be the view taken in the Collector of Customs, Madras vs Nathella Sampathu Chetty (1) where at the learned Judges observed : "We are therefore of opinion (1) that section 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 Exchanges Regulation Act 1947 by virtue of its being deemed to be a contravention of a notification on under section 19 of the , (3) that the preliminary require ment of section 178A that the officer seizing should entertain , 'a reasonable belief ' that the goods seized were smuggled" was satisfied in the present case. " In our opinion there is no merit in this appeal and it is dismissed. The appellant will surrender to his bail bonds. Appeal dismissed.

The appellant was searched by a Customs Official and some bars of gold were found tied round his waist. Out of those bars some were of base metal and the rest of pure gold which borne foreign markes. The appellant had no permit from the Reserve Bank of India to import the gold. He was prosecuted and convicted under section 167(81) of the . He brought an appeal to the Supreme Court by Special leave. Held, that section 178A of the , is constitutional. The contension that before the presumption under s.178A of the could be raised the prosecution had to prove that the gold was of foreign origin was rejected and held that section 178A provides that when the goods are seized in the reasonable belief that they are smuggled goods the onus is on the accused to show that they are not smuggled. Collector of Customs, Madras vs Nathella Sampathu Chetty (1962) 3 S.C.R. p.786 followed.

etition No. 19 of 1961. Petition under article 32 of the Constitution of India for enforcement of Fundamental Rights. A. V. Viswantha Sastri and D. N. Mukerjee, for the petitioners. Bajrang Sahai and section P. Yarma, for the respondents. 833 1962. March 14. The Judgment of the Court was delivered by AYYANGAR J. We consider that this petition under article 32 of the Constitution is entirely devoid of merits and deserves to be dismissed as misconceived as it does not involve any question of the infringement of any fundamental right. The petition is substantially for the issue of a writ of prohibition directing the Collector of Hazaribagh not to proceed with an enquiry pending before him under section 4(h) of the, Bihar Land Act and a writ of cortical to quash the proceedings. The property regarding which a tension is raised that the fundamental rights of the petitioner under Arts.19(1)(f) and 31(1) of the constitution are alleged to have been infringed, is a. plot of land within the municipal limits of Hazaribagh in Bihar together with certain buildings and structures thereon. The property originally belonged to the Ramgarh Raj. There is a dispute its to the manner in which this property was being enjoyed by the then proprietors and so we shall at this stage refrain from saying anything about it. On January 16, 1948 the Raja of Ramgarh granted a lease of this property in favour of his younger brother Basant Narain for a term of 99 years. On April 7, 1949 the Raja settled his reversionary interest in the property for the benefit of a, Trust under a registered deed of settlement The estate, of Ramgarh was notified under section 3 (1) of the, Bihar Land Reforms Act (Bihar I of 1950) for being taken over by the Government of Bihar and in consequence the estate statutorily vested in the State on and from November 3, 1951. Section 4(h) of the Bihar Land Reforms Act enacts: "The collector shall have power to make inquiries in respect of any transfer including the settlement or lease of any land comprised in such estate or the transfer of any kind of 834 interest in any building used primarily as office or kutcbery for the collection of rent of such estate or tenure or part thereof, made at any time after the first (lay of January 1946 and if he is satisfied that such transfer was made with the object of defeating any provisions of this Act or causing loss to the State or obtaining higher 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. " It will be noticed that the lease in favour of the Raja 's younger brother was dated January 16, 1948 and therefore was well within the period specified in the provision. It was the contention of the State that the buildings on the property which were the subject of the lease dated January 16, 1948 were being used by the Raj primarily as an office or kutcheri for the collection of rent a fact which however was disputed and is a subject of contest in the proceedings now sought to be quashed. On November 27, 1955 a notice was issued to Basant Narain to show cause why the lease executed in his favour on January 16, 1948 should not beset aside under the power conferred upon the Collector by section 4(h). Basant Narain submitted his objections and stated that the leased properties were not covered by section 4(b). Before however this enquiry was completed, Basant Narain surrendered his leasehold interest to the assignee of the reversion, viz., the Trust, by a registered deed dated January 1, 1957. Subsequently on June 1, 1959 the Trust which thus became entitled to the entire interest in the property in its turn leased the property to one Bansidhar and about a month later, on July 3, 1959 835 Bansidhar assigned his leasehold interest in the property to the petitioner company and that is how the petitioner came upon the scene. On November 13,1959 the Collector pawed an order cancelling the lease. The petitioner who laid claim to a title to the property under the assignment in its favour dated July 3, 1959, applied to the Collector to set aside his order both on the merits and also on the ground that the order of November 13, 1959 had been passed to its prejudice without giving it an opportunity to make its objections even though by that date it had obtained title to the property and therefore a locus standi to be heard. We are not now concerned with the correctness or otherwise of the contention raised by the petitioner, because the State of Bihar set aside the order of the Collector and directed a re enquiry and in this re enquiry the petitioner filed a petition before the Collector on August 9, 1960 setting out its case. It was during the progress of this last enquiry that the petitioner moved this Court by the present petition for the reliefs which we have already set out. Pausing here it is necessary to add that the constitutional validity of section 4(h) is not challenged and the case therefore turns on whether the property satisfies the conditions on which the section is attracted. The relief sought in this petition is based on two allegations: (1) that the land on which the buildings stand is raiyati land and therefore could not be taken possession of by the State under the Bihar Land Reforms Act and (2) that the buildings standing thereon were previously used for the residential purpose of the ' Raja and his family and not as a kutcheri. The enquiry has been proceeding before the Collector in regard to these two points and it may be mentioned that when the petitioner applied to this Court for a stay of proceedings before the Collector,, this Court passed an order permitting the enquiry to continue ' though it stayed the passing of 836 any order by the State Government. It will thus be seen that if the contention of the State is correct as regards the tenure of the property and as regards the purpose for which the buildings were used, the title of the State to the property would be made out and the petitioner could have no legitimate grievance. If, on the other hand, the petitioner establishes in the enquiry the case that it has put forward in the petition it is bound to succeed. Thus the question whether petition has any right to the property which it claims depends wholly on questions of fact which are plainly within the jurisdiction of the authorities constituted under the Bihar Land Reforms Act. Before a party can complain of an infringement of his fundamental right to hold property he must establish that he has title to that property and if his title itself is in dispute and is the subject of adjudication in proceedings legally constituted, he cannot obviously put forward any claim based on his title until as a result of that enquiry he is able to establish his title. It is only thereafter that the question whether his rights in or to that property have been improperly or illegally infringed could arise. In the circumstances we consider that the petitioner can complain of no infringement of its fundamental right, as to justify a petition under article 32. The petition is dismissed with costs. Petition dismissed.

The property regarding which the contention is raised that the fundamental rights of the petitioners under articles 19(1) (f) and 31 ( 1) of the Constitution are alleged to 832 have been infringed is a plot of land within the Municipal limits of Hazaribagli with certain buildings and structures thereon,which originally belonged to the Raja of Ramgarh. On January 16, 1948, the Raja leased this property to N for a term of 99 years and sometime thereafter settled his reversionary interest of the property for the benefit of a Trust. The estate of Ramgarh was notified under section 3(1) of the Bihar Land Reforms Act for being taken over by the Government of Bihar and in consequence, the estate statu torily vested in the State of Bihar. A notice was issued to N to show cause why the lease executed in his favour should not be set aside under s.4(h) of the act as the lease was executed well within the period specified under section 4(h). N submitted objections standing that these properties were not covered by section 4(h). During the pendency of the enquiry N surendered his leasehold to the trust. The trust leased the property to one 1, who assigned his household interest in the property to the petitioner Company. The present sought to quas the said proceedings under section 4(h) pending before the Collector wherein an enquiry was having held as to the manner in which the property in, question was being enjoyed by tile Raja of Ramgarh prior to the transfer, by lease for 99 years. The question is whether any fundamental rights of the petitioner have been infringed by the enquiry being held. Held, that before a party could complain of an infringement of his fundamental rights to hold property he must establish that be has title to that property and if that title itself is in dispute and is the subject of adjudication in proceedings legally constituted,the cannot obviously put forward any claim based on such title until as a result of that enquiry his title established. It is only thereafter that the question whether his rights in or to that property have been improperly or illegally infringed could arise.

Appeal No. 407/61. 908 Appeal by special leave from the judgment and order dated August 23, 1960, of the Orissa High Court in O.J.C. No. 103 of 1959. N.O. Chatterjee and P. K. Chatterjee, for the appellant, C. K. Daphtary, Solicitor General of India, B. R. L. Iyengar and P. D. Menon, for the respondents. B.M. Patnaik, section N. Andley, Rameshwar Nath and P. L. Vohra, for the Intervener. March 16. The Judgment of the Court was delivered by WANCHOO, J. This is an appeal by special leave against the judgment of the Orissa High Court. The brief facts necessary for present purposes are these. The appellant made an application to the State Government of Orissa in 1949 for grant of a mining lease for manganese ore over an area comprising 5400 acres situated in the district of Keonjhar. The appellant was the first applicant for the lease of the aforesaid area, and subsequently other persons applied for lease of the same area including Messrs. Tata from and Steel Company Limited hereinafter referred to as Tatas), the intervener in the present appeal. The Government of Orissa decided to grant the in favour of Tattas and in January 1956 referred the matter to the Central Government for its approval under r. 32 of the Mineral Concession Rules, 1949 hereinafter referred to as the Rules), which lays down that if more than one application regarding the same, land is received, preference shall be given to the application received first, unless the State Government, for any special reason, and with the prior approval of the Central Government decides to the contrary. The appellant made a representation to the Central Government against the recommendation of the 909 State Government. Eventually, on April 9, 1957, the Central Government turned down the recommendation of the State Government about the grant of the mining lease to Tatas. It also directed that the applications received prior to the application of Tatas should be considered according to the Rules but added that in case the Government of Orissa desired to work the area on a departmental basis, the Central Government would have no objection to consider a proposal for that purpose. Thereafter the State Government rejected the application of the appellant in December 1957 on the ground that the State Government proposed to arrange for the exploitation of the area in the public sector. This was followed by an application for review to the 'Central Government under r. 57 of the Rules. This application was rejected by the Central Government in June 1969. Thereupon the appellant filed a petition under article 226 of the Constitution in the High Court in July 1959. This petition was dismissed by the High Court on the ground that it had no jurisdiction to deal with the matter under article 226 as the final order in the case was passed by the Central Government which was located beyond the territorial jurisdiction of the High Court. The appellant then applied to the High Court for a certificate to appeal to this Court, which was rejected. He then asked for special leave from this Court, which was granted; and that how the matter has come up before us. The main question raised before us is the limit of the jurisdiction of the High Court under article 226 in circumstances like those in the present case. The contention on behalf of the appellant is that as the Central Government bad merely dismissed the review petition, the effective order rejecting the appellant 's application for the mining lease was that of the State Government and therefore the High Court would have jurisdiction to grant a writ 910 under article 226, and that the principle laid down in Election Commission India vs Saka Venkata Subba Rao(l) would not apply. Reliance in this connection has been placed on the decision of this Court in The State of Uttar Pradesh vs Mohammed Nooh(2). It is well settled by a series of decisions of this Court beginning with Saka Venkata Subba Rao 's case(1) that there is two fold limitation on the power of the High Court to grant a writ under article 226. These limitation are firstly that the power is to be exercised throughout the territories in relation to which the High Court exercise jurisdiction, that is to say, the writs issued by the High Court cannot run beyond the territories subject to its jurisdiction, and secondly, that the person or authority to whom the High Court is empowered to issue such writs must be within those territories, which clearly implies that they must be amenable to its jurisdiction either by residence or location within those territories. The view taken in this case has been recently reaffirmed by this Court in Lt. Col. Khajoor Singh vs Union of India. (3) Prima facie, therefore, as the final order in this case was passed by the Central Government which is not located within the territories over which the High Court has jurisdiction, the High Court will have no power to grant a writ in this case. Learned counsel for the appellant however relies on the decision in Mohd. Nooh 's case (2) where it was held that it was not correct to say that an order of dismissal passed on April 20, 1948, merged in the order in appeal therefrom passed in May 1949, and the two orders in turn merged in the order passed in revision on April 22, 1,950, or that the original order of dismissal only became final on the passing of the order in revision. It was further held that the order of dismissal was operative on its 1. ; 2. ; 3. ; 911 own strength and therefore no relief under article 226 could be granted against the order of dismissal passed in 1948 as article 226 was not retrospective in operation. It is urged that if the order of dismissal in that case did not merge in the final order of revision which was passed in April 1950, after the Constitution came into force, there was no reason why the order of the State Government should be taken to have merged in the order of the Central Government in this case so as to deprive the appellant of his remedy in the High Court under article 226. We are of opinion that the principle of Mohd. Nooh 's Case(1) cannot apply in the circumstances of the present case. The question there was whether the High Court would have power to issue a writ under article 226 in respect of a dismissal which was effective from 1948, simply because the revision against the order of dismissal was dismissed by the State Government in April 1950 after the Constitution came into force. It was in those circumstances that this Court held that the dismissal having taken place in 1948 could not be the subject matter of an application under article 226 of the Constitution for that would be giving retrospective effect to that Article. The argument that the order of dismissal merged in the order passed in appeal therefrom and in the final order of revision was repelled by this Court on two grounds. It was held (firstly) that the principle of merger applicable to decrees of courts would not apply to orders of departmental tribunals, and (secondly) that the original order of dismissal would be operative on its own strength and did not gain greater efficacy by the subsequent order of dismissal of the appeal or revision, and therefore the order of dismissal having been passed before the Constitution would not be open to attack under article 226 of the Constitution. We are of opinion that the facts in Mohd. Nooh 's case (1) were of a special kind and (1) ; 912 the reasoning in that case would not apply to the facts of the present case. Further, in A. Thangal Kunju Musaliar vs M. Venkitachalam Potti (1), though this Court was considering a matter in which the question which is before us was not directly in issue, it had occasion to consider certain decisions of certain High Courts which dealt with oases similar to the present case : (see p. 1213). In those decisions orders had been passed by certain inferior authorities within the territories subject to the jurisdiction of the High Courts concerned, but they had been taken in appeal before superior authorities which were located out. side the territories subject to the jurisdiction of the High Courts concerned. In those circumstances the High Courts had held that the order of the inferior authorities had merged in the orders of the authorities. This Court apparently approved of the view taken by the High Courts in those cases on the ground that a writ against the inferior authority within the territories could not be of any avail to the petitioners concerned in those oases and could give them no relief for the orders of the superior authority outside the jurisdiction would remain outstanding and operative against them. Therefore, as no writs could be issued against the outside authorities, this Court was of the view that the High Courts were right in dismissing the petitions, as any writ against the inferior authority which is within the jurisdiction of the High Court, in view of the orders of the superior authority, would be infructuous. The position in the present case is similar to that envisaged above. The Orissa Government rejected the application of the appellant for grant of the mining lease. The appellant being aggrieved by that order went in review to the Central Government under the Rules and that review petition was dismissed so that in effect the Central (1)[1955] 2 S.C.R. 1196, 913 Government also rejected the application of the ,appellant for grant of the mining lease to him. It is not in dispute that if the Central Government was so minded it could have allowed the review and directed the Orissa Government to grant mining lease to the appellant. Therefore when the Central Government rejected the review petition, it in effect rejected the application of the appellant for the grant of the mining lease to him. This order of the Central Government in effect rejecting the application of the appellant for the grant of the mining lease to him and confirming the rejection of the application of the appellant by the Orissa Government is clearly not amenable to the jurisdiction of the High Court of Orissa under Art 226 in view of the fact that the Central Government is not located within the territories subject to the jurisdiction of the Orissa High Court. It would therefore have been useless for the Orissa High Court to issue a writ against the Orissa Government for the Central Governments order rejecting the review petition and therefore in effect rejecting the application of the appellant for grant of the mining lease would still stand This is made clear by r. 60 of the Rules, which provides that "the order of the Central Government under Rule 59 and subject only to such order, any order of a State Government under these rules, shall be final". Clearly therefore r. 60 provides that where there is a review petition against the order passed in the first instance by the State Government, the order of the Central Government passed in review would prevail and would be the final order dealing with an application for a mining lease under the Rules. Therefore, quite apart from the theoretical question of the merger of the State Government 's order with the Central Government 's order, the terms of r.60 make it perfectly clear that whenever the matter is brought to the Central Government under r. 59, it is the order of the Central Government which is effective and final. In these 914 circumstances we are of opinion that the High Court was right in holding that it had no jurisdiction to issue a writ under article 226 in the present case as the final order in this case was that of the Central Government which was not situate within the territories over which the High Court has jurisdiction. Our attention in this connection was drawn to Shivji Nathubhai vs The Union of India (1). In that case a mining lease had been granted by the State Government to a particular person and there was a review petition against the grant of that mining lease. The order granting the mining lease was set aside on review without notice to the person to whom the lease had been granted. In that connec tion a question arose whether the person to whom the State Government had granted the lease had any interest to enable him to make an application under article 226. It was then pointed out by this Court that under the Rules the order of the State Government would be effective as there was no re quirement that it was not final until confirmation by the Central Government. That case however is of no assistance to the appellant for where there is a review petition and the Central Government passes an order on such petition one way or the other it is the Central Government 's order that prevails and the State Government 's order must in those circumstances merge in the order of the Central Government. The observations in that case on which the appellant relies were made in another connection and can have no bearing on the question before us, where an order has been passed by the Central Government on review and it is that order which is made final by r. 60 and which stands in the way of the appellant. There is therefore no force in this appeal and it is hereby dismissed with costs. Appeal dismissed.

The State Government of Orissa rejected the application of the appellant who had applied for grant of a mining lease in December 1957 on the ground that the State Government proposed to arrange for the exploitation of the area in the public sector. The appellant made an application for review to the Central Government under r. 57 of the rules of Mineral Concession Rules, 1949. This application was rejected by the Central Government in June 1959. Thereupon the appellant filed a petition under article 226 of the Constitution in the High Court of Orissa. This petition was dismissed by the High Court on the ground that it had no jurisdiction to deal with the matter under article 226 as the final order in the case was passed by the Central Govern ment, which was located beyond the territorial jurisdiction of the High Court. The appellant came up by special leave to appeal to the Supreme Court. The main question is as to the limit of the jurisdiction of the High Court under article 226. The appellant contended that as the Central Government had merely dismissed the review petition, the effective 907 order rejecting the, appellant 's application for the mining lease was that of the State Government and therefore the High Court would have jurisdiction to grant a writ under article 226. that the High Court was right in holding that it had no Jurisdiction to issue a writ under article 226 in the present case as the final order in this case was that of the Central Government which was not situate within the terri tories over which the High Court had jurisdiction. This order of the Central Government in effect rejecting the application of the appellant. for the grant of the mining lease to him and confirming the rejection of the application of the appellant by the Orissa Government is clearly not amenable to the jurisdiction of the High Court of Orissa under article 226 in view of the fact that the Central Government is not located within the territories subject to the jurisdiction of the Orissa High Court. It would therefore have been useless for the Orissa High Court to issue a writ against the Orissa Government for the Central Government 's Order rejecting the application of the appellant for the grant of the mining lease would still stand. Held, further that quite apart from the theoretical question of the merger of the State Government 's Order with the Central Government 's Order, the terms of r. 60 of the Mineral Concession Rule 1949 make it perfectly clear that whenever the matter is brought to the Central Government under r. 59, it is the order of the Central Government which is effective and final. So where there is a review petition and the Central Government passes an order on such petition one way or the other it is the Central Government 's Order that prevails and the State Government 's Order must in those circumstances merge in the order of the Central Government. Election Commission India vs Saka Venkata Subba Rao, ; , Lt. Col. Khajoor Singh vs Union of India, ; , A. Thangal Kunju Musaliar vs M. Venkitachalam Potti ; relied on. Shivji Nathubhai vs The Union of India, ; , referred to. The State of Uttar Pradesh vs Mohammad Nooh (1958) S.C.R. 595, not applicable.

Appeal No. 286 of 1961. Appeal from the judgment and order dated January 27, 1960, of the Kerala High Court in I. T. R. Case No. 14 of 1955. K.N. Rajagopal Sastri and D. Gupta, for the Appellant. S.P. Desai J. B. Dadachan , O. C. Mathur and Ravinder Narain, for the respondent. March 20. The Judgment of the Court was delivered by HIDAYATULLAH, J. In this appeal by the Commissioner of Income Tax Kerala filed with 962 certificate of the High Court of Kerala, an important question of law was raised before the High Court, which was answered against the Department. It arose in the following ,circumstances. The respondent, the West Coast Chemicals and Industries, Ltd. (referred to as the assessee Company) was incorporated in 1937 primarily with the object of acquiring and working the rights, title and interest in a match factory belonging to one A. V. Thomas at Medical. The Memorandum of Association of the asseesee Company, however, empowered the Company to manufacture and deal in acids, alkalis and other chemicals. The assessee 'Company carried on its business of manufacturing matches till the account year ending, on April 30, 1941. Thereafter, the profits from the business became less and less due to War conditions, and the assessee Company began to manufacture plywood chests for tea, paints and lemon grass oil. These were contemplated by cl. (3) of the ' Memorandum of Association. On May, 9, 1943, the assessee Company entered into an agreement with one Rao Sahib Natesa Iyer for the sale of the lands, buildings, plant and machinery of its match factory for Rs. 5, 75,000. It was agreed that the price would not include manufactured goods, chemicals and other raw materials or any other asset not shown in the agreement of sale. The purchaser was allowed sixty days for the payment of the balance of the price, Rs. 57,500 having been already paid at the time the agreement was 'entered into. The purchaser made a default in payment, and on August 9, 1943, a fresh agreement was entered .into by the parties, this time for a consideration of Rs. 7,35,000, and the sale included chemicals and paper for manufacture which had not been sold in the first instance. In a confidential report made on August 1, 1944, to the shareholders, the 963 Directors stated that the price obtained had shown a capital appreciation of about six times the cost price, and the sale of chemicals had also resulted in a substantial profit. Meanwhile, the assessment of the Company for the, account year ending April 30, 1944, bad been completed by the Deputy Commissioner of Income tax, and the assessee Company had been assessed on an income of Rs. 36,498 6 4. The Deputy Commissioner of Income tax then issued a notice under section 25 of the Travancore Income tax Act to the Company 's Liquidator on the ground that the profits from the sale of the chemicals and paper for manufacture had escaped assessment. The Official Liquidator took up the position that the match manufacturing had been stopped, and that business had been wound up, and there thus only an appreciation of the capital assets and not a business profit, which, was liable to assessment. The Deputy Commissioner, however, relying, upon the Memorandum of Association, which allowed the assessee Company to manufacture and sell chemicals, and on the Directors report, held that the assessee Company was liable to income tax on a profit of Rs. 2 lakhs arising from this sale. The Commissioner of Income tax on appeal, however, reduced the assessable profits to Rs. 1,15,259. Before the Commissioner, the Liquidator admitted that the profit from the sale of the chemicals wits Rs. 1, 15,259. An appeal was then filed before the Income tax Appellate Tribunal at Trivandrum, and the assessee Company contented that a stock in trade could only be that which was the subject of trade, and that the stock of raw material was not sold in the course of ordinary trading but in a reali sation sale after the Company had been wound up. The Tribunal found that the business had not 964 completely ceased to exist, since the assessee Company was carrying on manufacturing, on behalf of the purchaser, and, the sale could not be regarded as a realisation sale after the Company was wound up, but had the characteristics of a trading sale. At the request of the assessee Company, however, the Tribunal referred two questions to the High Court for its decision, and they were: "(1) whether the transaction of sale of the raw materials along with the business,including machinery, plant and premises is a revenue sale, and whether in the facts and circumstances of the case, the sum of Rs. 1,15,254has been rightly charged to income tax; and (2) whether the decision that the sale of match, machinery and premises, was distinct from the sale of chemicals is legally war ranted and whether there was legally a single, transaction of the entire match factory inclusive of raw materials?" It maybe pointed out that prior to the sale of chemicals to the purchaser, the only evidence of sale of chemicals by the assessee Company was of two transactions. In the first transaction, there was a sale of chemicals on July 24, 1943,to an educational institution for Rs. 50 and another sale on October 30, 1943, to a stranger for Rs. 7 12 0. The High Court held that by the sale no business was done, and that the amount obtained was only by way of realisation sale and was not, therefore, liable to tax. 'rho argument of the Department (also raised before the High Court) proceeds in this way. The Department refers to the Memorandum of Association under which the assessee Company was to carry on the business of manufacturing and 965 selling chemicals, that in the past it bad sold chemicals, that in the first sale of its assets it had excluded chemicals and some other raw materials necessary for the manufacture of matches and had sold the concern for a lesser price, that later it included chemicals and raw materials and obtained a larger price, and that admittedly 'there was an identifiable profit of Rs. 1,15,259 on the sale of the chemicals and raw materials. The Department, therefore, contends that the amount of Rs. 1, 15,259 was properly brought to tax as a trading profit. The question, therefore, is whether there can be said to be a sale in the carrying on of the business in respect of the chemicals and other raw materials. This question is not one easy to decide,specially with the assistance of rulings, in which the facts were different. There is a great danger of extracting a principle from the reported cases, divorced from the facts. In Halsbury 's; Laws of England, 3rd Edn., Vol. 20, pp. 115 117, there is a list in the footnotes of the cases which have been decided on one side or the other of the dividing line. In the text, the law, as summarised from the cases, is stated as follows : "210. Mere realisation of assets is not trading; but the completion of outstanding contracts after the dissolution of a firm, the commencement of liquidation of a company, or the winding up of the affairs of a trader, has been held to be trading. . 211 . The cases illustrating the question arising in such circumstances can be divided into two categories, first, those where the sales formed part of trading activities, and, second, those where the realisation was not an act of trading". This distinction, in our opinion, is a sound one. The only difficulty is in deciding whether a particular 966 case belongs to one category or the other. In this, much support cannot be derived from observations made by learned Judges pertaining to the facts of a case, but they do guide one in a true appraisement of the case in hand. In the well known case of Californian Copper Syndicate vs Harris (1), the difference between the purchase price and the value of the shares for which the property was exchanged was considered as profit assessable to income tax. There, the company was formed for the purpose of acquiring and reselling mining properties, and though what it had acquired had all been Bold or exchanged, the transaction was considered a business transaction failing within the avowed objects, of the Company. The case has been accepted as decided on these narrow facts, in Tebrau (Johore) Rubber Syndicate Ltd. vs Farmer (2), in which a different conclusion was reached on slightly different facts. There also, the Company was formed with the object of acquiring rubber estates and for developing them. Under the Memo randum, the Company had the power to sell its properties. Two properties having been acquired and the funds having run out, they were sold but at a profit. This profit was considered as an appreciation of capital and not as assessable profit. The difference between these two oases is that whereas in the former, though the whole of the property was sold, it was sold at; a part of trading, in the letter, the property was sold not as part of trading but on a winding up sale. The Department relies upon Californian Copper Syndicate vs Harris (1),while the assesse Company relies upon Tebrau (Johore)Rubber Syndicate Ltd. vs Farmer (2) . These cases were also considered and applied by the Privy Council in Doughty vs Commissioner of Taxes (3), which is relied upon by (1) (2) (3) 967 both sides, in view of certain observations of the Privy. Council, to which we shall presently refer. In that case, there were two partners carrying on business in New Zealand as general merchants. They sold the partnership to a limited company, of which they were the only shareholders. The sale was of the entire assets including the goodwill, and the price was payable in the shape of fully paid shares in the new company. The nominal value of the shares was more then the capital account as shown in the last balance sheet, and the partners prepared a new balance sheet in which a larger value was placed upon the stock in trade. The Income tax authorities in New Zealand treated the difference between the value placed on the stock in trade in the old balance sheet and that placed in the new balance sheet as a profit liable to tax. The Privy Council held that this was wrong, pointing out that for profit to arise, there must be a trading, and that a mere alteration of a book keeping entry was not evidence that there was profit. It also held that the sale was of the entire assets, and that the price represented a payment for the entire business without a separate sale or valuation of this stock in trade for purposes of sale. It referred to two cases decided respectively by the Supreme Court of New Zealand and the, High Court of Australia, in which sales by pastora lists of their flock of sheep had taken place. In the New Zealand case, the excess obtained over the book value was treated as assessable profit, but in the Australian case, it was not. Both the sales were of the entire stock. The Privy Council approved of the Australian case, and though it did not ex pressly dissent from the New Zealand case, it indicated that it found it difficult to appreciate the decision. These two cases from New ' Zealand and Australia were, of course, relied upon by the rival parties before us, and we shall consider them. 968 The Australian case is Commissioner of Taxation (W. A.) vs Newman (II. A person who carried on business in Western Australia as a pastoralist sold his property including all live stock and plant, as a going concern. The Commissioner of Taxation for the State apportioned the purchase money in respect of the live stock, and assessed the amount which was received in excess, as income derived from carrying on a business. The High Court held that the transaction was not during the carrying on of the business or even for the purpose of carrying on the business, but was for the purpose of putting an end to the business, and that thus the excess represented a capital appreciation and not a trading profit. The Now Zealand case is Anson vs Commissioner of Taxes (2). In that case also, a sheep farmer sold his entire stock of sheep. He had the practice of placing on his sheep at the beginning and end of each year an arbitrary value without reference to the, actual market value. When he sold his entire stock, a nominal profit of pound 5,000 odd appeared, and he was assessed on it. The Supreme Court hold that it was not an accretion to capital but a profit on the sale of the appellant 's stock in trade. Sir John Salmond, who delivered the judgment of Court, observed that the holding of a sheep farmer was not a capital holding, but his sheep represented a stock in trade, and since every appreciation of a stock in trade represented a profit assessable to income tax, it mattered not that the stock in trade was sold at once or from time to time. Of this case, the Privy Council in Doughty 's case (3) did not say much, but enough to cast a doubt upon it. This is what the Privy Council said at p. 335. "It would be difficult to arrive at the profit in this way if it were the case of a (1) [1921] 2 (2) [1922] N.7.L.R. 330. (3) [1927] A. C. 327. 969 farmer in England but the trade of a pastora list is one with which the New Zealand Courts would be familiar, and which it would be more easy for the New Zealand Judges than for their Lordships to appreciate. " The Privy Council made a distinction between a sale of the entire stock as a part of trading and a sale of the same stock as a winding up sale. It observed that if the business be one of purely buying and selling, "a profit made by the sale of the whole of the stock, if it stood by itself, might well be assessable to income tax". It observed that in Dougherty 's case (1) the sale was a slump transaction, and was a winding up of the business rather than a trading. The Privy Council further pointed out that there is a difficulty in deciding cases of a business, which involve breeding of sheep for the purpose of selling wool This is quite true, because the sheep may be regarded as the capital, with which the wool, which is sold, is produced, or the sheep with the wool on them may be regarded as the stock in trade. Such a question, fortunately, does not arise in the present case, which can be decided on the narrow ground whether the business was being wound up and the sale, a realisation sale, or whether trading was going on in spite of the winding up, so as to attract tax on profits made. Before we answer this question in relation to the facts of this case, we wish to refer to a ' few more cases, which were cited before us. In J. & R. O 'Kane & Co. vs The Commissioners of Inland Revenue (2), the appellants carried on business as wine and spirit merchants. They then wished to retire from the business and sent a circular letter to their customers. During the year, they sold their *bole stock to diverse customers. , and the question was whether they were still carrying on their trade during that period, and whether the profits were thus made in the (1) [1927] A.C. 327. (2) 970 ordinary course of trade. It was held by the King 's Bench Division of the High Court of Justice in Ireland that the sales were not in the ordinary course of trade but were part of the realisation of the trading stock and winding up of the business, and thus not liable to tax. The Court of Appeal in Ireland unanimously reversed the decision of the High Court. Ronan, L. J., pointed out that though the taxpayer had retired from business and had decided not to purchase any more stock, he was still carrying on the business of trading in wines and spirits till his existing stocks were exhausted, and, therefore, the excess obtained by him represented profit. On appeal to the House of Lords, it was held that there was evidence on which the Commissioners could arrive at their finding that trading was, in fact, being carried on. Lord Buckmaster, speaking Of the facts in that case, observed as follows : "For in truth it is quite plain that right up to the en of 1917 they were engaged in trading which, so far as the external world is concerned, was the ordinary method of carrying on trade modified only by arrangements which were merely part of the machinery of business dealing adopted to effect their intention to retire. It may well be accepted that they did so intend ; yet the intention of a man cannot be considered as determining what it is that his acts amount to; and the real thing that has to be decided here is what were the acts that were done in connection with this business and whether they amount to a trading which would 'cause the profits that accrued to be profits arising from a trade or business The case was, therefore, decided on the finding of the special Commissioners, for which there was enough material in evidence. Similarly, the case 971 of The Commissioner of Inland Revenue vs "Old Bashmills" Distillery Co., Ltd. (in Liquidation) (1) was one decided on a finding, in support of which there was evidence. The two cases relied upon by the Department and the assessee Company respectively do not shed any light upon the problem before us ' because the central decision in both of them was whether the Commissioners ' finding was justified or not. In J. and M. Craig (Kilmarnock),Ltd. vs Cowperthwaite(2), the question was how the opening .stock should have been valued, And whether any profit could be said to have resulted. The Privy Council in Doughty 's case (3) remarked about this case as follows: "There, on a transference from one company to another, one third of the value of each item, other than stock in trade, as it stood in the books of the selling company, was treated as its value for transfer purpose, and the balance of a slump price, which, with an under taking to discharge liabilities, formed the consideration, was inferentially attributable to the stock. It was held, however, in that case that no sum could be pitched upon as the actual price of the stock, and no claim to assess a profit could be based upon such a foundation. " This case shows that where a slump price is paid and no portion is attributable to the stock iii trade, it may not be possible to hold that there is a profit other than what results from the appreciation of capital. The essence of the matter however, is not that an extra amount has been gained by the selling out or the exchange but whether it can fairly (1) (2) (3) (1927) A.C. 327. 972 be said that there was a trading from which alone profits can arise in business. If this test is applied to the present case, then the true answer would be the one given by the High Court in the judgment under appeal. There is no doubt, in this case, that the assessee Company was wound up at least in so far as its match manufacture was concerned. That the business of the Company was sold as a going concern, and was, in fact, worked by the assessee Company on behalf of the buyer till the entire consideration was paid, makes no difference, because the agreement clearly indicated that the, assessee Company was keeping the factory going, not on its own behalf but entirely on behalf of the buyer. One cannot fairly say, therefore, that a sale of the chemicals and raw materials for match manufacture was anything more than a winding up sale, not with a view to trading in chemicals and raw material but to close down the business and to realise the assets. There was, in fact, no identifiable price for the chemicals and raw materials except by comparing the two prices offered to be paid by the buyer, that is to say, the price without the chemicals and raw materials and the price with them. From that alone, however, it is impossible to infer that the chemicals and raw materials were sold in the ordinary way of business or that the assessee Company was carrying on a trading busi ness. The fact that the clause in the Memorandum gave power to the Company to Bell chemicals cannot be used in this connection, because the evidence clearly shows that that clause was never used and the two sales of chemicals through the years were too petty in themselves to afford evidence of a continued or sustained trading In chemicals. In our judgment, this was a winding up sale with a view to realising the capital assets of the assessee 973 Company and not a sale in the course of business operations, which alone would had attracted tax, if profit resulted. In the result, the appeal fails and is dismissed with costs. Appeal dismissed.

The respondent company was incorporated in 1937 primarily with the object of acquiring and working a match factory. Under the memorandum of association the company was also empowered, inter alia, to manufacture and deal in chemicals. The business of manufacturing matches was carried on by the company till 1941. Thereafter the profits became less and less due to war conditions. On May 9, 1943, the company entered into an agreement with a third party for the sale of the lands, buildings, plant and machinery of its match factory for Rs. 5,75,000. It was agreed that this price would not include manufactured goods, chemicals and other jaw materials or any other asset not shown in the agreement of sale. Later, a fresh agreement was entered into on August 9, 1943, under which the sale included chemicals and paper for manufacture which had not been sold in the first instance and the price was Rs. 7,35,000. In a report to the shareholders dated August 1, 1944, the Directors stated that the price obtained had shown a capital appreciation of about six times the cost price and that the sale of chemicals had resulted in ' substantial profit. In proceedings for assessing income which had escaped assessment the income tax authorities, relying upon the memorandum of association which allowed the 961 company to manufacture and sell chemicals and on the Directors ' report, held that the profit from the sale of the chemicals and other raw materials was liable to income tax on a profit of Rs. 2,00,000 which was reduced later to Rs. 1, 15,259. The company claimed that the stock of raw materials was sold not in the course of ordinary trading but only in a realisation sale after the company had been wound up. The evidence showed that the clause in the memorandum of association giving power to the company to sell chemicals was seldom used and that prior to the sale of chemicals to the purchaser, two transactions of sale of chemicals for small amounts in 1943 were too petty in themselves to afford evidence of trading in chemicals. Held, that though under the second agreement dated August 9, 1943, more price was paid, the transaction was still a winding up sale and no part of this slump price was identifiable as the price of the chemicals and other raw materials. There was no evidence that before the winding up the company had sold chemicals as part of its business, and the two instances cited were too petty in themselves to afford evidence of a continued or sustained trading in chemicals. A winding up sale is not "trading or doing business" and the sale of the raw materials including the chemicals was not part of any business done. Accordingly, the sum of Rs. 1,15,259 was not liable to tax. Doughty v Commissioner of Taxes, (1927) A. C. 327, di. ',Cussed and relied on. Case law reviewed.

minal Appeal No. 171 of 1959. Appeal by special leave from the judgment and order dated August 3, 1959, of the Allahabad High Court in Criminal Revision No. 1080 of 1959. 0. P. Rana and A. 0. Ratanaparkhi, for the appellant. G. C. Mathur and C. P. Lal, for The dent. March 26. The Judgment of the Court was delivered by RAGHUBAR DAYAL, J. One Ram Narain was ' ordered by the High Court of Allahabad, on June 9, 1958, to furnish a personal bond for a lakh of rupees and three sureties, two in the sum of Rs. 40,000/ each and one in the sum of Rs. 20,0001in respect of the case against him for having committed. criminal breach of trust with respect, to the funds of the Pikaura Co operative Society He 57 was to furnish the personal bond and the sureties within three weeks from the date of the order. It was further ordered: "The applicant should furnish the personal bond and sureties as 'directed above within three weeks from today and during that period he will not be arrested. If he does not furnish the bonds and sureties within this period he will be liable to be re arrested and detained till the necessary bonds and sureties are furnished. " It may be mentioned that Ram Narain had previously furnished a personal bond and sureties in connection with the embezzlement alleged to have been committed by him and that the necessity for a fresh order for furnishing personal bond and sureties arose on account of the police submitting more than one charge sheet with respect to the amount embezzled and it was felt that the original security furnished might not be, effective. On June 26, 1958, Ram Narain executed a personal bond for Rs. 1,00,000/ and offered,the required sureties. Kashi stood surety for Rs. 40,000/ , Safir Hussain for Rs. 40,000/ and Smt. Sona for Rs. 20,000/ respectively. The surety bond by Safir Hussain was not duly verified as he was in hospital at that time, but when it was put up to Safir Hussain for verification on July 12, 1958 be refused to verify it. Prior to this, on July 7, 1958, Safir Hussain filed an application before the Magistrate praying that his surety bonds in connection with the embezzlement of Rs. 40,000/ and Rs. 80,000/ be cancelled. Ram Narain was present in Court that day. No particular order was passed on this application of Safir Hussain. On July 93 1958, an application on behalf of Ram Narain was filed stating that Bekaru 's surety 58 be accepted in place of Safir Hussain 's surety. Bekaru filed the surety. bond offering himself to stand surety for Re. 40,000/ for Ram Narain 's appearance in Court. He was identified by Sri Ahmad Husain, Vakil, who certified that Bekaru Singh possessed sufficient property to stand surety for Rs. 40,000/ . The Magistrate ordered for the verification from the Tehail and on receipt of the report from the Tehsil, accepted the bond on August 20, 1958. The Tehsil report, however, indicated that the house mentioned in the surety bond and alleged to be worth Rim. 60,000/ was estimated to be worth Rs. 16,075/ . The police charge. ,sheet in the case appears to have reached the Court on August 20, 1958, when summons for the appearance of Ram Narain was ordered to be issued for September 1, 1958. The summons was not served. When Ram Narain did not appear on September 1, 1958, September 9, and September 23, the Court, on September 24, ordered action under sections 87 and 88 Cr. P.C. against him and the issue of notices to the sureties to produce him in Court. When he did not appear in Court on October 29, the Court forfeited the personal bond executed by Ram Narain and the bail bonds executed by the sureties and ordered issue of notice to the sureties to pay the penalty or show cause a.,) to why the amount be not recovered from them. Bekaru objected to the forfeiture of his surety bond. On April 20, 1959, the objection was disallowed and the learned judicial officer ordered that the amount of Rs. 40,000/ be recovered from his movable. property through attachment and sale. Bekaru appealed but his appeal was dismissed by the learned Sessions Judge. His revision application to the High Court was also dismissed. He has preferred this appeal by special leave. The main contention for the appellant is that the learned Magistrate should pot have accepted 59 Bekaru Singh 's surety bond without first taking action contemplated by sub sections (2) and (3) of section 502, Cr. P.C. Section 502 reads: "(1) All or any sureties for the attendance and appearance of a person released on bail may at any time apply to a Magistrate e to discharge the bond, either wholly of so far as relates to the applicants. (2) On such application being made, the Magistrate shall issue his warrant of arrest directing that the person so released be brought before him. (3 ) On the appearance of such person pursuant to the Warrant, or on his voluntary surrender, the Magistrate shall direct the bond to be discharged either wholly or so far as relates to the applicant, and shall call upon such person to find other sufficient, sureties, and, if he fails to do so, may commit him to custody. " It is urged that the Magistrate had to issue a warrant for the arrest of Ram Narain when Safir Hussain had presented his application for the discharge of his surety bond and that when Ram Narain would have appeared before the Court in execution of that warrant, the Magistrate had to first discharge Safir Hussain 's surety bond and only then could have called upon Ram Narain to furnish other surety. The Magistrate took no such stop and therefore could not have legally accepted the surety bond offered by Bekaru on July 9,1958. We do not agree with this contention. These provisions Of section 502 are meant for the continuity of the surety bond on the basis of which an accused has been released on bail till such time that the accused is before the Court and for taking further action in case the accused desires to offer another security in place of the one who is to be discharged. They are not conditions precedent for the acceptance of 60 a fresh surety in place of the earlier one. In the circumstances of the present case, there was no occasion to issue a warrant for the arrest of Ram Narain on Safir Hussain 's applying for the discharge of his surety bond We do not Know in what circumstances no particular order was passed on July 7, 1958 on the application of Safir Hussain. Ram Narain who was present in Court that day, may have intimated to the Court that he would offer a fresh surety on July 9. Anyway a fresh surety was offered on that day viz; July 9. Bekaru stood surety. An application on behalf of Ram Narain was presented praying for the acceptance. of Bekaru 's surety bond in place of Safir Hussain 'section In accepting Bekaru 's surety bond the Court committed no wrong. It was interested in getting a fresh surety for letting Ram Narain continue on bail. Bakaru offered the surety bond. His competence to stand surety for Rs. 40,000/. was certified by a Vakil, Safir Hussain 's bond therefore stood cancelled and Bekaru 's took its place. We do not therefore consider that there was any incompetency in the Magistrate 's accepting Bekaru 's surety bond in place of Safir Hussain 'section It is true that Bekaru 's surety bond was formally accepted on August 20, 1958, but that does not matter. Sub section (1) of section 499, Cr. P. C. provides that before any person is released on bail bond must be executed by such person and bonds be also executed by sureties for the attendance of that person in Court. Sub section (3) of s.499 is "(3) For the purpose of determining whether the sureties are sufficient, the Court way, if it so thinks fit, accept affidavits in proof of the facts contained therein relating to the sufficiency of the sureties or may make such further enquiry as it deems necessary. " When Bekaru furnished the surety bond he also filed 61 an affidavit stating therein that the house mentioned in the surety bond was worth over Rs. 40,000/ Sri Ahmed Husain Vakil, certified that Bekaru possessed sufficient property to stand surety for its. 40,000/ In the circumstances, the Magistrate could accept Bekaru 's surety bond. Of course the Magistrate could make further enquiry as well and it was for the purpose of further enquiry that he ordered verification from the Tehsil. Bekaru 's bond, in our opinion, was accepted on July 9, subject to further orders on the receipt of the Tehsil report. Further, Ram Narain 's continuing on bail is justified by the provisions of 8. 500 Cr. P. C., once Bekaru 's surety bond had been filed. Its sub section (1) provides that as soon as the bond has been executed, the person for whose appearance it has been executed shall be released. This contemplates that the accused is to be released on the execution of the bonds which should be accepted on their face value in the first instance. Section 501, Cr. P. C. provides for the issue of a warrant of arrest of the person so released on bail if it is subsequently found that through mistake, fraud or otherwise, insufficient sureties bad been accepted, or if they afterwards became insufficient. We are therefore of opinion that formal acceptance of Bekaru 's surety bond on August 20, 1958 by the Magistrate does not in any way affect Bekaru 's liability on that bond from July 9, 1958. Any way, he was liable on that bond for the non appearance of Ram Narain on a date subsequent to August 20, 1958. It may be mentioned that it was urged up to the appeal stage that the surety bond was accepted on the 20th of August 1958 after the Magistrate had known of the absconding of Ram Narain. The Courts found against this allegation as there was no evidence in support of it. Another point urged is that the surety bond executed by Bekaru Singh did not have on the other 62 side the personal bond executed by Ram Narain and that in the absence of a personal bond by Ram Narain, the surety bond executed by Bekaru could not be legally accepted. Reliance is placed on the case reported as Brahma Nand vs Emperor (1) and a few other cases expressing the same view. These cases are distinguishable on facts. In Brahma Nand 's case. (1) the accused himself had not executed any bond and therefore it was held that the surety bonds could not be forfeited. In the present case Ram Narain executed bond on June 26, 1958. Kasbi, one of the sureties, executed the surety bond printed at the back of the bond executed by Ram Narain. Ram Narain had already bond himself to pay Rs. 1,00,000/ in case he failed to appear in Court when required. Other sureties bond themselves to pay the various amounts in case Ram Narain did not appear. Their surety bond are good by themselves. Bekaru 's surety bond is there fore as effective and legal as Kashi 's bond which is just on the back of Ram Narain 's bond. It is not required by any provision of the Code of Criminal Procedure that all the sureties should execute the bond printed at the back of the form on which the accused execute the personal bond or that the accused must execute as many bonds in identical terms as there are surety bonds by individual sureties. The mere fact that Form No. XLII, Schedule V. Criminal Procedure Code, prints the contents of the two bonds, one to be executed by the accused and the other by the surety, together, does not mean that both these bonds should be on the same sheet of paper. We are, therefore, of opinion that Bekaru 's bond can be forfeited if Ram Narain does not comply with the terms of his bond executed on June 26, 1958 and that Ram Narain had not to execute a (1) A. 1. R. 1939 All. 63 bond afresh when Bekaru furnished fresh surety in place of Safir Hussain 's surety bond. We therefore hold that the appellant 's bond has been rightly forfeited on the non appearance of Ram Narain in 'Court. We therefore dismiss the appeal.

One R was granted bail on his furnishing a personal bond and three sureties which he did. On July 7, one of the sureties S applied for the discharge of his bond. On July 9, R made an application that the appellants surety bond be accepted in place of S, and the same day the appellant filed his surety bond. The appellant also filed an affidavit that he had property enough to satisfy the bond and a vakil also certified to that effect. The bond was sent for verification to the Tehsil and after verification was formally accepted on August 20. Subsequently R absconded and the appellant 's bond was forfeited. The appellant contended that the forfeiture was illegal and that his bond was not properly accepted as no warrant was issued for the arrest of R when S applied for the discharge of his bond, as the bond of S was not formally discharged and as R had not executed a personal bond on the reverse of the form on which the appellant bad executed his bond. 56 Held, that the surety bond of the appellant had been. properly accepted and the forfeiture was legally made. The provisions of section 502 of the Code of Criminal procedure were meant for the continuity of the surety bond and for enabling the accused to offer another surety bonds; they were not conditions precedent for the acceptance of a fresh surety in place of an earlier one. There was no occasion to issue a warrant for the arrest of R as he was present, in Court on July 7, when S applied for the discharge of his bond and may have intimated to the Court that lie would offer fresh surety on July 9. The Court was interested in getting a fresh surety for letting R continue on bail and it did no wrong in accepting the appellant 's surety bond which was offered. The bond of S stood cancelled and appellant 's bond took its place. The bond of the appellant was really accepted on July 9 when the appellant filed the affidavit as required by section 499 (3) of the Code and the Vakil also certified as to his solvancy. It was immaterial that the bond was formally accepted on August 20. Further, it was not necessary that each surety should execute the surety bond on the reverse of the personal bond of the accused.

minal Appeal No. 240 of 1959. Appeal by special leave from the judgment and order dated July 15, 1959, of the Calcutta High Court in Criminal Revision No. 135 of 1959. section C. Mazumdar, for the appellant. Sukumar Ghose, for the respondent No. 1. 1962. March 26. The Judgment of the Court was delivered by KAPUR, J. This is an appeal against the judgment and order of the High Court of Calcutta passed in revision against the order of the Additional Session,% Judge, Howrah, who had modified the order of conviction of the respondents under section 488 read with a. 386(1)(b) of the Calcutta Municipal Act (Act III of 1923) as extended to the Municipality of Howrah, hereinafter called the 'Act '. The appellant before us is the Chairman of the Municipal Committee of Howrah who is the complainant and the respondent is a company with its premises at No. 1 Swarnamoyee Road, where it was carrying on the manufacture of bobbins, card pine, shuttles etc. They were also storing their wood and timer in those premises. 49 The charge against the respondent was that it was using the premises within the municipality of Howrah without a license as required under section 386 of the Act and was therefore guilty under section 488 of the Act. The defence of the respondent was that the premises had been licensed as a warehouse under the West Bengal Fire Services Act, 1950 (Act 18 of 1950) and consequently because of section 38 of that Act, section 386 of the Act stood repealed and the respondent was not required to take out another license under, section 386 of the Act. The Magistrate, before whom the case was tried, was of the opinion that the effect of a. 38 of the West Bengal Fire Services Act was that the power of the Municipality to require a license under a. 386 of the Act for user as a warehouse had been taken away and therefore in respect of the rest of the premises used as a factory or for other purposes the applicability of section 386 remains unimpaired. He found that the respondent was running a factory with workshops fitted with electric power in the premises for the manufacture of bobbins, card pins, shuttles etc. He convicted the respondent under section 488 and sentenced him to a fine of Rs. 250. In appeal the learned Additional Sessions Judge held that section 38 of the West Bengal Fire Services Act does not repeal all the three clauses of section 386 of the Act but partially repeals a. 386(3) which deals with the levy of fees and therefore a license under section 386(1) will still have to be taken but as the premises had al. ready been licensed as a warehouse the respondent company could not be required to pay any fees under a. 386(3) of the Act. The object, according to the learned Sessions Judge, was that the levy of fees twice over in respect of the same premises was prohibited and not that the license was not required. The sentence of fine was therefore reduced from Rs. 250 to Rs. 10 only. Against this order the appellant took a revision to the High Court. 50 The High Court held that where the premises are licensed as a warehouse under the Fire Services Act but a portion of it is used as a workshop the Municipal Committee has No. longer the power to levy any fees for granting the license in respect of the premises even though there may be a liability to take out a license i.e. while it may be necessary to take out a license under section 386(1) of the Act no fees could be charged and as the whole of the premises in case had been licensed as a warehouse under the West Bengal Fire Services Act no part of the premises would be liable for any charge of fees for granting a license. A further argument was also raised for the appellant in the High Court and that was that a. 38 of the West Bengal Fire Services Act did not apply to the Howrah Municipality at all because the Howrah Municipality is governed neither by the Calcutta Municipal Act nor by the Bengal Municipal Act but by the Calcutta Municipal Act as extended to Howrah i. e. as modified in accordance with the powers conferred on the Government by section 541(2) of the Calcutta Municipal Act. But the High Court was of the opinion that a. 38 of the West Bengal Fire Services Act is applicable to the Howrah Municipality and there. fore repelled this last argument. The revision was therefore dismissed, and the rule was discharged. Against that order the appellant has come in appeal by special leave. The main argument raised by the appellant was that section 38 of the West Bengal Fire Services Act could not affect the operation of section 386 of the Calcutta Municipal Act as it was extended to the Howrah Municipality. Section 38 of the former Act reads as under: "On the application of this Act to Calcutta or any other Municipality, section 51 38 6 of the Calcutta Municipal Act, 1923, or section 370 of the Bengal Municipal Act, 1932, as the case may be, shall be deemed to be repealed in so far as they entitle the Corpo ration of Calcutta or the Commissioners of the Municipality to levy fees in respect of any premises or part thereof licensed as a warehouse under this Act". It was contended that section 38 of that Act does not repeal section 386 of the Act because the interpretation of that section is that it repeals section 386 of the Calcutta Municipal Act 1923 which entitles the Corporation of Calcutta to levy fees and section 370 of the Bengal Municipal Act, 1932 which entitles the Commissioners of other Municipalities to levy fees in respect of any premises licensed as a warehouse; in other words the argument was that in the case of Corporation of Calcutta section 386 of the Act shall be deemed to be repealed to the extent mentioned in section 38 and in the case of other Municipalities and the Commissioners of those Municipalities s.370 of the Bengal Municipal Act. 1932 shall be deemed to be repealed to the extent that, s.38 is applicable and as Howrah Municipality is neither the Corporation of Calcutta nor is it governed by section 370 of the Bengal Municipal Act, section 38 is inoperative. To test the correctness of this argument it is necessary to refer to the provisions by which the Act was extended to the Municipality of Howrah. Under so. 540 and 541 of the Calcutta Municipal Act the Provincial Government was empowered to extend all or any of the provision of that Act to the Municipality of Howrah. Under section 542 the effect of the extension was that the Bengal Municipal Act 1932 stood repealed qua the Municipality of Howrah from the date of such extension and sub cl. (b) of that section provides: "Except as the Provincial Government may otherwise by notification in the Official 52 Gazette direct, all rules, by laws, orders, directions and powers made, issued or conferred under the portions of this Act which have been so extended and in force at the date of such extension, shall apply to the said municipality or part, in Supersession of all corresponding rules, by laws, orders, directions and powers made, issued or conferred under the said Bengal Municipal Act, 1932" and by an explanation to that section the extension of the Act did not put the Municipality of Howrah tinder the authority of the Corporation of Calcutta. By a Gazette Notification NO. 260M of January 18, 1932 practically the whole of the Act, excepting the provisions which are not necessary, was extended to the Municipality of Howrah. The language extending the Act was as follows: "Howrah. 260M. 18th January 1932 In exercise of the power conferred by sub section (2) of section 541 of the Calcutta Municipal Act, 1923 (Bengal Act III of 19 3). the Government of Bengal (Ministry of Local Self Government) are pleased to extend to the Municipality of Howrah the following pro visions of the Calcutta Municipal Act 1923, subject to the modifications and restrictions specified therein which are 'shown in antique type. As a result of this extension section 386 was extended to the Municipality of Howrah with this modification that in place of the word "Corporation of Calcutta ' the word "Commissioners" was substituted. In 1951 the Calcutta Municipal Act 1951 being West Bengal Act 33 of 1951 was enacted thus replacing Act 3 of 1923 which was therefore repealed. In the new Act corresponding provision to sections 540, 541 and 542 are sections 589, 590 and 591. Section 614 of the new Act provides that the provisions of Act III of 1923 as extended to the Municipality of Howrah shall continue to be in force until the provisions of the new 53 Act are extended to that Municipality under the new Act. Thus the effect of the extension by the Notification under sections 540 and 541 of the Calcutta Municipal Act is that to the Municipality of Howrah an amended Act with an amended section 386 is applicable and not section 386 of the Act III of 1923. Keeping this in view we have then to see how far section 38 of the West Bengal Fire Services Act 1950 (Act 18 of 1950) has affected the operation of section 386 as it applies to the Municipality of Howrah. Section 38 provides that section repeals section 386 of the Act III of 1925 to the extent therein mentioned. It also repeals section 370 of the Bengal Municipal Act as it applies to the Commissioners of Municipalities in Bengal. It does not apply to section 386 as modified and is inapplicable to the Municipality of Howrah because in section 386 as applicable to the Corporation of Calcutta the word used is ",Corporation" and not "Commissioners" and wherever the word "Corporation" is used in section 386 it is replaced by the word "Commissioners" in section 386 as it applies to the Howrah. Municipality. It cannot be said therefore that section 38 repeals section 386 of the Act III of 1923 as it applies to the Howrah Municipality. In a somewhat similar case a similar view was taken by the Privy Council. See Secretary of State for India vs Hindusthan Co operative lnsurance Society (1). In that case certain provisions of the Land Acquisition Act were incorporated by reference Into the Calcutta Improvement Act 1911. By an amendment of 1921 the right of appeal to the Privy Council from the decision of the High Court was provided in matters failing under the Land Acquisition Act. It was held that the right of appeal so given was not applicable to the award of a tribunal under the Calcutta Improvement Act assessing compensation in respect of land acquired under the provisions of the. Land Acquisition Act. Dealing with this matter Sir George Lowndes quoted with (1) (1931) L.R. 58 1.A. 259. 54 approval the observations of Lord Westbury in Ex parts St. Sepulchre 's (1) and observed: "It seems to be no less logical to hold that where certain provisions from an existing Act have been incorporated into a subsequent Act, no addition to the former Act, which is not expressly made applicable to the subsequent Act, can be deemed to be incorporated in it, at all events if it is possible for the subsequent Act to function effectually without the addition". Although a. 38 of the West Bengal Fire Services Act extends to the whole of Bengal and to the extent there set out it repeals section 386 of the Calcutta Municipal Act which applies to the Corporation of Calcutta and section 370 which applies to the other Municipalities of Bengal yet it does not affect the operation of section 386 of the former Act as modified and extended to the Municipality of Howrah by the notification which has been set out above. The reason for that is that the language of section 386 has been modified to make it appropriate in its application to the Municipality of Howrah and for that purpose in place of the word `corporation ' the word " 'Commissioners" has been substituted. Thus modified it is not a. 386 of the Calcutta Municipal Act but a different section. Therefore what s.38 of the West Bengal Fire Services Act repeals is section 386 of the Calcutta Municipal Act and not section 386 of that as modified and applied to the Municipality of Howrah. It may look rather anomalous but that is what the effect of the modification of the language is. In our opinion therefore the contention of the appellant is well founded 'and section 38 of the West Bengal Fire Services Act does not repeal section 386 as modified and as applicable to the Municipality of Howrah. From the point of view of the respondent the result may be unfortunate (1) , 376. 55 but that is the interpretation of the language of the various sections which are relevant in the present case. We therefore allow the appeal, set aside the order of the High Court and convict the respondent of the offenses charged, but in view of the fact that the appellant succeeds on a question of interpretation we do not think it necessary to increase the sentence of fine imposed by the learned Sessions Judge, The, appeal is allowed to that extent. Appeal allowed.

The respondent company was prosecuted for using the premises within the Municipality of Howrah without a license as required under section 386 of the Calcutta Municipal Act 1923, as extended to the Municipality of Howrah by Notification No. 260 M dated January 'A 8, 1932, under sections 540 and 541 of the Act. The Bengal Municipal Act, 1932, also stood repealed qua the municipality of Howrah under section 542 of the Act from the date of such extension. The defence of the respondent was that the premises had been licensed as a warehouse under the West Bengal Fire Service Act, 1950, and consequently, because of section 38 of the Fire Services Act, section 386 of the Act stood repealed and the respondent was not required to take out another license under the said section 386. The respondent was however convicted under section 488 of the Act. In appeal the Sessions Judge reduced the sentence and fine. The appellant took a revision to the High Court. The High Court held inter alia that section 38 of the Fire Service Act was applicable to the Howrah Municipality. Therefore, while it may be necessary to take out a license under section 386 (1) of the Act, no part of the premises would be liable for any charge of fees for granting a license. The appellant came up in appeal by special leave to the Supreme Court. Held, that the effect of extension of section 386 of the Calcutta Municipal Act, 1923, by notification No. 260 M dated .January 18, 1932, under section 540 and section 541 of the Act, to the Municipality of Howrah is that an amended Act with section 386 is applicable to the Municipality of Howrah and not section 386 of the Calcutta Municipal Act, 1923. Although section 38 of the West Bengal Fire Services ' Act extends to the whole of Bengal and to the extent there set it, repeal section 386 of the calcutta Municipal Act which 48 applies to the Corporation of Calcutta and section 370 of the Bengal Municipal Act which applies to the other Municipalities of Bengal yet it does not affect the operation of section 386 of the former Act as modified and extended to the Municipality of Howrah by the notification. The language of section 386 has been modified to make it appropriate in its application to the Municipality of Howrah and for that purpose in place of the word 'corporation ' the word 'commissioners ' has been substituted. Thus modified it is not section 386 of the Calcutta Municipal Act but a different section. Therefore what section 38 of the West Bengal Fire Services Act repeals in section 386 of the Calcutta Muncipal Act and not section 386 of that as modified and applied to the Municipality of Howrah. Secretary of State for India vs Hindusthan Co operative Insurance Society, (1931) L. R. 59 1. A. 259, referred to.

Appeals Nos. 10 and 10 A of 1952. Appeal from the Judgment and Order dated 11th January, 1950, of the High Court of Judicature at Madras in Cases Referred Nos. 80 of 1946 and 38 of 1948. M. C. Setalvad, Attorney General for India, (G. N. Joshi and P. A. Mehta, with him) for the appellant. section Krishnamachariar for the respondent. 465 1952. December22. The Judgment of the Court was delivered by DAS J. These two consolidated appeals are directed against the Judgment and order made on January 11, 1950) by the High Court of Judicature at Madras in References No. 80 of 1946 and No. 38 of 1948 under section 66 of the Indian Income tax Act whereby the High Court relying on its earlier decision in Commissioner of Income tax, Madras vs B. Rm. M. Sm. Sevugan alias Manickavasagam Chettiar(1) held that the references were incompetent and accordingly refused to answer the questions raised therein. The facts are shortly as follows. The respondent who is a Nattukotai Chettiar had, his headquarters at Karaikudi in India and also carried on his money lending business at branches at Maubin, Kualalumpur and Singapore. He also had income from properties at Maubin and Singapore. For the assessment year 1941 42 the Income tax Officer calculated the assessee 's accrued foreign income as Rs. 29,403 at Maubin, Rs. 27,731 at Kualalumpur and Rs. 34,584 at Singapore, in all Rs. 91,718. After deducting out of this amount Rs. 4,500 allowed under the 3rd proviso to section 4 (1) of the Act, the Income tax Officer computed the total assessable foreign income at Rs. 87,218. Out of the total remittances of Rs. 84,352 the Income tax Officer allocated Rs. 7,900 to the accrued income of Maubin and Rs. 62,315 to those of Kualalumpur and Singapore and the balance of Rs. 14,137 to the taxed income of earlier years. The Income tax Officer disallowed the claim of the assessee to deductions under several heads. On the basis of the total foreign income of Rs. 67,218 and income from ' other sources the Incometax Officer calculated Rs. 23,266 8 0 to be due by the assessee on account of income tax, super tax and surcharges thereon and by his assessment order dated January 31, 1942, made this amount payable on or before February 25, 1942. The assessee preferred an (1) [1948] 16 I.T.R. 59; ; A.I.R. 1948 Mad, 418 466 appeal to the Appellate Assistant Commsioner against the disallowance of the several items of his claim including the claim for replantation expenses amounting to$498incurred at Kualalumpur and a bad debt of $ 15,472 at Singapore. The Appellate Assistant Commissioner by his order dated May 25, 1942, allowed some of the several objections but disallowed the items of replantation expenses and ba` debt and reduced the assessment to Rs. 22,548. The assessee took further appeal before the appellate Tribunal against the disallowance of the several claims by the Appellate Assistant Commissioner including the two items mentioned above. The Appellate Tribunal by its order dated August 20, 1943, held that the replantation expenses "will be allowed to the appellant as expenses. " As regards the bad debt the Tribunal held that it was permissible and that "the deduction claimed will, therefore, be allowed. " The result was that the appeal was partly allowed. The matter came back before the Income tax Officer on September 26, 1945. Deducting Rs. 778 on account of replantation expenses the Kualalumpur income was reduced to Rs. 26,953 and after deducting Rs. 24,175 on account of the bad debt the Singapore income came down to Rs. 10,409. These two reduced amounts together with Rs. 29,403 being the income 'from Maubin made up the total accrued income of Rs. 66,765. Out of this amount Rs. 4,500 was deducted on account of unremitted profits of Maubin under the 3rd proviso to section 4(1) of the Act, leaving a balance of Rs. 62,265. Out of the remittances the Income tax Officer allocated Rs. 7,000 towards the accrued income of Rs. 29,403 from Maubin and Rs. 37,362 against the totarl accrued income of Kualalumpur and Singapore. He also allocated Rs. 24,549 as remittances out of assessed profits of previous years, leaving a balance of Rs. 13,541. This amount the Income tax Officer considered as remittances out of earlier years ' unassessed income and held it to be asses. able to tax. After adding Rs. 13,541 to Rs. 62,265 being the net accrued income of the year 467 from Maubin, Kualalumpur and Singapore, the Income tax Officer arrived at the total foreign income of Rs. 75,806. On the basis of this foreign income together with other income the Income tax Officer. recalculated the amount of income tax, super tax and surcharges thereon at Rs. 22,802 6 0 and after giving credit for certain amounts, found Rs. 21,211 14 0 as the balance due which by his order dated September 26, 1945, was made payable in equal moiety on or before September 30, 1947, and March 31, 1948. He, however, did not issue any notice of demand under section 29 of the Act. Being aggrieved by the inclusion of Rs. 13,541 as the alleged unassessed foreign income of earlier years remitted to India during the year of account the assessee preferred an appeal before the Appellate Assistant Commissioner. The Appellate Assistant Commissioner was not satisfied that the assessee had any right of appeal under section 30 of the Act for there had been no assessment under section 23 and no notice of demand had been served on the assessee under section 29 of the Act. Accordingly the Appellate Assistant Commissioner by his order dated November 19, 1945, declined to admit the appeal. He, however, expressed the view that the assessee 's remedy might lie in a miscellaneous application to the Tribunal complaining that the Income tax Officer had either misconstrued or had not given effect to the order of the Appellate Tribunal. The assessee then brought a miscellaneous application to the Appellate Tribunal. The Appellate Tribunal held that the. finding of the Income tax Officer that the sum of Rs. 13,541 was to be assessed as untaxed profits of earlier years remitted to India in the accounting year did not arise in the course of giving effect to the Appellate Tribunal 's order and by its order dated February 20, 1946, cancelled that finding and directed the Income tax Officer to revise the computation accordingly. The last mentioned order having been served on the Commissioner of Income tax, Madras, on March 8, 468 1946, the latter on May 1, 1946, made an application before the Appellate Tribunal under section 66(1) of the Act and prayed that three questions formulated by him in his petition should be referred to the High court. The contention was that the Appellate Tribunal had no jurisdiction in law to entertain, consider and pass the order which it did on the miscellaneous application seeing that it was neither an appeal under section 33 of the Income tax Act nor could it be regarded as a rectification under section 35 of any mistake committed by the Bench. The Appellate Tribunal took the view that although no specific provision was made in the Act by which it could give effect to its order or explain any ambiguity in such an order by a later order in any miscellaneous application filed by any party, such power, nevertheless ', was inherent in" the Tribunal. The Tribunal accordingly thought that a point of law did arise and on August 23, 1946, referred the following question to the High Court, namely: "Whether in the facts and circumstances of this case the order of the Bench dated 20th February, 1946, in the miscellaneous application is an appropriate order and is legally valid and passed within the jurisdiction and binding on the Income tax Officer. " The Tribunal declined to refer the other questions formulated by the Commissioner. This reference came to be numbered as Case Referred No. 80 of 1946. It appears that pursuant to an order made by the High Court on March 30,1948, on the application of the Commissioner of Income tax under section 66 (2) of the Act the Tribunal referred the following question to the High Court: " If the answer to the question already referred to the High Court by the order of the Appellate Tribunal dated 23rd August, 1946, is in the affirmative,, whether, in the circumstances and on the facts of the case, the recomputation made by the Income tax Officer pursuant to the decision of the Appellate 469 Tribunal in R.A.A. No. 53 (Madras) of 1942 43 was valid and correct." The Appellate Tribunal made this further reference on July 19, 1948, which came to be numbered as Case Referred No. 38 of 1948. The two referred cases came up for consideration before a Bench of the Madras High Court and it was held that the reference under section 66(1) was incompetent in view of the earlier decision of that Court mentioned above which they felt to be binding on them and accordingly the Bench declined to answer the questions. The Commissioner of Incometax thereafter applied for and obtained leave to appeal to this Court from the decisions in both the references and obtained such leave on his undertaking to pay the costs of the assessee in any event. The two appeals were thereafter consolidated and have come up before us for final disposal. Section 66 A (2) gives to the aggrieved party a right of appeal to this Court from any judgment of the High Court delivered on a reference made under section 66 in any case which the High Court certifies to be a fit one for appeal to this Court. Section 66, (5) provides that the High Court upon the hearing of any such case referred to it under section 66(1) and (2) shall decide the questions of law raised thereby and shall deliver its judgment thereon containing the grounds on which such decision is founded. During the opening of the case by the learned Attorney General a question arose as to whether the simple refusal of the High Court to bear the case on the ground that the reference was incompetent was a decision and judgment such as is contemplated by section 66(5) of the Act from which alone a right of appeal to this Court is given. While maintaining that the decision and judgment of the Madras High Court fell within the meaning of section 66(5) the learned Attorney General for greater safety asked that the appeal may be treated as one on special leave granted by this Court under article 136 of the Constitution. The learned Advocate appearing for the 470 assessee respondent did not object to this prayer and accordingly we gave leave to the appellant under article 136 and treated this appeal as one filed pursuant to such leave. In the circumstances it is not necessary for us to express any opinion on the appealability of the order of the High Court under section 66 A of the Act. The learned Attorney General contends that the decision relied on by the High Court has no application to the facts of the present case. In that case the Tribunal by its order dated July 11, 1944, allowed an appeal from the Appellate Assistant Commissioner and cancelled the assessment which it held to be illegal. This order was served on the Commissioner shortly thereafter. On October 5, 1944, an application was made to the Tribunal by the Income tax Officer under section 35 to correct a statement contained in the statement of facts in the order. More than 60 days after the date of the service on him of the order of July 11, 1944, to wit on October 7, 1944, the Commissioner made an application under section 66 (1) of the Act requiring the Tribunal to refer to the High Court the question as to the correctness of its decision embodied in the order of July 11, 1944. Both the applications were disposed of on the same day, namely, January 17, 1945, when the application for rectification was granted and a case was stated for the opinion of the Court as prayed. Section 66 (1) requires the application to be made within 60 days of the date on which the applicant is served with notice of an order under sub section (4) of section 33. It was held that the granting of an application for rectification under section 35 and correcting the error in the order was not an order under section 33 (4) and, therefore, was not one in respect of which section 66 (1) permitted a case to be stated. It was further held that if the Appellate Tribunal improperly or incorrectly made a reference in violation of the provisions of the statute, the High Court was capable of entertaining an objection to the statement of the case and that, if it camp to the 471 conclusion that the case should not have been stated, the High Court was not compelled to express an opinion upon the question referred. in the case before us there is no question that the present application was not made within time, but the contention is that section 66 (1) only contemplates an application for a reference of a question of law arising out of " such order" which clearly means an order made under section 33 (4), _and, therefore, if there is no valid order under that section no question of law can be said to arise out of "such order" and consequently the Appellate Tribunal can have on jurisdiction to make any reference to the High Court under section 66(1). Section 66 (2) provides that if on any application being made under sub section (1) the Appellate Tribunal refuses to state the case on the ground that no question of law arises, the assessee or the Commissioner may, within the time specified therein, apply to the High Court and the High Court may, if it is not satisfied of the correctness of the decision of the Appellate Tribunal, require the Appellate Tribunal to state the case and to refer it. The jurisdiction given to the High Court under this sub section is conditional on an application under sub section (1) being refused by the Appellate Tribunal. This clearly presupposes that the application under sub section (1) was otherwise a valid application. If, therefore, an application under sub section (1) was not well founded in that there was no order which could properly be said to be an order under sub section (4) of section 33 then the refusal of the Appellate Tribunal to state a case on such misconceived application on the ground that no question of law arises will not authorise the High Court, on an application under sub section (2) of section 66, to direct the Tribunal to state a case. The jurisdiction of the Tribunal and of the High Court is conditional on there being an order by the Appellate Tribunal which may be said to be one under section 33 (4) and a question of law arising out of such an order. The only question for our consideration, therefore, is whether in this case any question 472 of law arose out of an order which can properly be said to have been made by the Appellate Tribunal under sub section (4) of section 33, for if it did not, then the Appellate Tribunal would have no jurisdiction under sub section (1) of section 66 to refer a case, nor would the High Court have jurisdiction under sub section (2) of that section to direct the Tribunal to do so. It was at one stage suggested by the learned AttorneyGeneral that we should in the first instance remit the matter to the High Court for their decision on this question but as the question is one of law depending on the construction of the relevant sections of the Act it will save time if it is decided by us here and now. It is not disputed that we have the power, on the hearing of this appeal, to decide this question. It will be recalled that when on 19th November, 1945, the Appellate Assistant Commissioner declined to admit the appeal, the assessee did not prefer any appeal but only made a miscellaneous application before the Appellate Tribunal. There is no provision in the Act permitting such an application. Indeed, in the statement of the case the Appellate Tribunal states that in entertaining that application and correcting theerror of the Income tax Officer it acted in exercise ofwhat it regarded as its inherent powers. There being no appeal under section 33 (1) and the order having been made in exercise of its supposed inherent jurisdiction. , the order cannot possibly be regarded as one under section 33 (4) and there being no order under section 33 (4) there could be no reference under section 66 (1) or (2) and the appellate Court properly refused to entertain it. The learned Attorney General submits that this Court should not take such a narrow and technical view but should treat that miscellaneous application as really an appeal under section 33. Turning now to section 33 we find that any assessee objecting to an order passed by an Appellate Assistant Commissioner under section 28 or section 31 may appeal to the Appellate Tribunal within the time specified in 478 sub section (1) which time, however, may be extended by the Tribunal under sub section (2A). Under sub section (4) the Appellate Tribunal is given power, after giving both parties to. the appeal an opportunity to be heard, to pass such order thereon as it thinks fit. It is thus clear that the Appellate Tribunal can make an order under section 33 (4) only on an appeal from an order passed by the Appellate Assistant Commissioner under section 28 or section 31. If, therefore, there is no order which may properly be said to have been made by the Appellate Assistant Commissioner under section 28 or section 31 then there can be no appeal under section 33 (1) and consequently there can be no order under section 33 (4). Section 28 is not relevant for our present purpose. Section 30 provides for filing of appeals against assessments made under the Act. Sub section (1) of that section prescribes the different decisions against which an appeal will lie. Sub section (2) prescribes the time within which the appeal is to be filed. Subsection (3) prescribes the form in which the appeal is to be made. Then comes section 31 which gives power to the Appellate Assistant Commissioner to hear and dispose of such appeal. Sub section (3) of section 31 empowers the Appellate Assistant Commissioner in disposing of an appeal under section 30 to make one or other order under one or other of the several clauses of that ' sub section. It is, therefore, clear that in order that the Appellate Assistant Commissioner may exercise his jurisdiction and make an order under section 3 1, there must be an appeal as contemplated by section 30. The learned AttorneyGeneral only relies on the opening part of sub section (1) of section 30 and contends that the appeal before the Appellate Assistant Commissioner was with respect to the amount of income assessed under section 23 or section 27. It will be recalled that the Appellate Tribunal held that the two sums claimed by the assessee would be allowed to him and concluded by saying that the appeal was partly allowed. The power of the Appellate Tribunal under section 33(4) 474 is indeed wide, for on an appeal properly before it, it can make such order as it thinks fit. Therefore, it be order made by the Appellate Tribunal in this case on August 20, 1943, must be read and construed as a direction to the Income tax Officer to carry out the directions by allowing the two deductions in question. When the matter again came before the Income tax Officer his function was only to carry out the order of the Appellate Tribunal. He could not otherwise reopen the assessment already made by him under section 23. Therefore, in carrying out the directions of the Tribunal and in doing what be aid on September 26, 1945, the Income tax Officer cannot be regarded as having acted under section 23 or section 27 of the Act and that being the position no appeal lay from that order of the Income tax Officer under section 30 (1) of the Act, I The result of it was that there was no proper appeal before the Appellate Assistant Commissioner such as is contemplated by section 30 (1) and, therefore, the order made by the Appellate Assistant Commissioner cannot be regarded as an order made by him under section 31 (3), for an order under section 31 (3) can only be made in disposing of an appeal properly ' filed under section 30, and consequently no further appeal lay to the Appellate Tribunal under section, 33 (1) so as to enable the Appellate Tribunal to make an order under sub section (4) of that section. In the premises, there being no order which may properly be said to have been made under section 33 (4), no question of law can be said to arise out of an order made under section 33 (4) and consequently there can be no valid reference under section 66, subsection (1) or sub section (2). If, therefore, the reference was incompetent for want of jurisdiction both under section 66 (1) or section 66 (2) surely the High Court could decline to entertain it as it did. Even if the order dated September 26, 1945, made by the Income tax Officer after the matter came back to him to give effect to the decisions of the Appellate Tribunal be regarded as an order made by him under 475 section 23 or section 27 and as such appealable under section 30 (1) then the order made by the Appellate Assistant Commissioner on November 19, 1946, declining to admit the appeal clearly amounted to a refusal on his part to exercise the jurisdiction vested in him by law. An order thus founded on an error as to his jurisdiction way conceivably be corrected by appropriate proceedings but it cannot certainly be regarded as such an order as is contem plated by any of the sub sections of section 31. Such an order not coming within the purview of section 28 or section 31, no, appeal lay therefrom to the Appellate Tribunal under section 33 (1) and if no such appeal properly came before the Appellate Tribunal it could not properly make an order under section 33 (4) and if there was no order under section 33 (4) there could be no reference under section 66, sub section (1) or sub section (2). It follows, therefore, that the order of the Appellate Tribunal correcting the order of the Income tax Officer directing that the sum of Rs. 13,541 should not be included in the assessment cannot be regarded as an order passed by the Appellate Tribunal under section 33 (4) so as to attract the operation of section 66. The learned Attorney General urged that having under section 66 (2) of the Act directed the Appellate Tribunal to state a case the High Court could not afterwards refuse to answer the question thus referred to it. Whether the High Court was so precluded or not requires no decision on this occa sion, for even conceding but ;not deciding that the High Court was so precluded, this Court, at any rate, can surely entertain the question of the competency of the reference. The result, therefore, is that we dismiss these appeals with costs. Appeals dismissed.

By an order dated August 20, 1943, the Appellate Tribunal directed that certain deductions claimed by the assessee should be allowed. The matter came back to the Income tax Officer and he made an order on September 26, 1945, but did not issue any fresh notice of demand. The assessee appealed to the Appellate Assistant Commissioner complaining that in his order of September 26, the Income tax Officer had wrongly included a sum of Rs. 13,000 60 464 as unassessed foreign income of earlier years. The Appellate Assistant Commissioner held that the order of September 26 was not appealable. The assessee, therefore, made a miscellaneous application to the Appellate Tribunal, which held that the Incometax Officer acted wrongly in including the sum of Rs. 13,000 at that stage and directed the Income tax Officer to revise his computation accordingly. The Commissioner of Income tax, being of opinion that the Appellate Tribunal had no jurisdiction to entertain or make such order on a miscellaneous application applied for a reference to the High Court under section 66 (1) of the Income tax Act. The Tribunal referred certain questions and the High Court directed the Tribunal to refer certain other questions also but when the references came on for bearing the High Court held that the references were incompetent. The Commissioner of Incometax appealed to the Supreme Court with the leave of the High Court : Held, (i) that in carrying out the directions of the Tribunal and in passing the order of September 26, 1945, the Income tax Officer cannot be regarded as having acted under section 23 or section 27 of the Act and no appeal lay from his order under section 30 (1). The order made by the Appellate Assistant Commissioner was not therefore an order under a. 31 (3) and no further appeal lay to the Appellate Tribunal under section 33 (1) so as to enable the Tribunal to make an order under section 33 (4) and us there was no order under a. 33 (4), no question of law can be said to arise out of an order under section 33 (4) and there can be no valid reference under section 66 (1) or section 66 (2); (ii) even assuming that the order of the Income tax Officer dated September 26, 1945, was an order under a. 23 or section 27 and as such appealable, the order made by the Appellate Assistant Commissioner declining to entertain the appeal was not an order under any of the sub sections of a. 31 and no appeal lay therefrom to the Appellate Tribunal under section 33 (1) and there could be no order of the Appellate Tribunal under section 34 (1). The order of the Appellate Tribunal correcting the order of the Income tax Officer and directing that the sum of Rs. 13,541 should not be included cannot be regarded in any event as an order under section 33 (4) so as to attract the operation of section 66 (1) or (2).

Appeal No. 565 of 1960. Appeal from the judgment and decree dated September 26, 1956, of the former Travancore Cochin High Court in A. section No. 57 of 1954. A. V. Viswanatha Sastri, P. K. Subramania Iyer, R. Ganapathy Iyer, C. section Ananthakrishna Iyer and G. Gopalakrishnan, for the Appellants. M. E. Nambiyar, Rameshwar Nath, section N. Andley and P. L. Vohra, for the respondent. March 27. The Judgment of the Court was delivered by 88 KAPUR, J. This is an appeal against the Judgment and decree of the High Court of Travancore Cochin modifying the decree of the District Judge, Trichur. The appellant was defendant No.1 in his personal capacity and defendant No. 2 in the capacity of a trustee of a trust. Defendant No. 5 was a tenant of the building which is the subject matter of dispute between the parties, defendant No.10 was its successor in interest and the present respondent was the plaintiff in the suit. The suit out of which this appeal has arisen was filed in the Court of the District Judge, Trichur, on ' October 31, 1945. The suit was for possession of properties described in schedules A & B and for damages and mesne profits with interest. The defence was that the appellant was not liable to restore possession on the basis of a document Exhibit X which was a deed of trust executed by the appellant, creating a trust and constituting himself the trustee of the trust. The 5th defendant claimed Rs.20,000 and Rs.1019 as value of improvements and extensions made on the building. A large number of issues were framed by the trial court and it passed a decree of which the most important part was as follows: (a) The plaintiff is allowed to recover possession of A & B schedule items from the defendants in possession and to utilise the income from the B schedule item according to the terms mentioned in Exhibit II. (b) The 5th & 10th defendants are permitted to remove within a period of 2 months from today the constructions and additions made in the (A and B schedule items by them without causing any damage to the plaint properties. Again this decree three appeals were filed one by the appellant, the other by the 10th defendant 89 and the third by the plaintiff respondent. The High Court in appeal modified the decree of the trial court and held that the only claim which the appellant could put forward was for compensation for the structure he had erected. The amount of Compensation was R.46,686 2 0. The High Court also held that the respondent was entitled to recover mesne profit,% as against the appellant at the rate of Rs.88/ per annum till the recovery of property mentioned in schedule A and B at the rate of Rs.1500/ per annum in regard to schedule B buildings. It is against this decree that the appellant has come in appeal to this court by special leave. In order to understand the points in contro versy it will be helpful to give certain facts which led up to this litigation ' The respondent is a nonprofit sharing company, the main object of which seems to be to provide pecuniary assistance to the poor for educational and other charitable purpose. The respondent company owned survey No. 465 in the revenue estate of the village Trichur abutting on the public road in 1944 45. It was 55 cents in area. The respondent company erected buildings on the South and which had been rented to the then Imperial Bank of India ' now the State Bank of India, and in the middle portion there was a building which has been leased out to the Post Office. In the North there was a vacant plot measuring 20 cents which has been described as schedule A. A building was sought to be put up and was ultimately put up on about 7 or 8 cents out of this area which has been described in schedule B. Schedule A is the whole of the land measur ing 20 cents with the building on it on an area of 7 or 8 cents which is schedule B. In 1942 the appellant became the Chairman of the Board of Directors of the respondent company and was entrusted with the construction of the building which the respondent company wanted to put up 90 on 7 or 8 cents out of schedule A property which the appellant agreed to construct. The cost of the building at that time was estimated to be In Rs.12,000. It was also resolved to entrust to the appellant the construction of a latrine, a kitchen, gate, compound and partition wall of schedule A property which was constructed at a cost of Rs.2,000 expended by the respondent company. At the meeting ' of the Board of Directors of January 9, 1944 the directors of the respondent company were told by the appellant that Rs. 12,000 was insufficient for the completion of the building. On April 1944,. the appellant made an offer to the Directors of the respondent company that he would meet the entire cost of the construction of the building and hand over the building to the respondent company which would be a 'trust. This offer is contained in Exhibit AB. In this offer he stated that the estimated expenditure of the Dew building will be about Rs.30,000 and that he would meet the expenses and then he stated: "I shall entrust this building with the company as my trust property in accordance with the conditions mentioned below, and the company shall take over the above trust property and manage the affairs in accordance with three conditions mentioned below". One of the conditions was that the minimum income of the property shall be calculated at Rs.1500/ per annum which would be spent for the education of poor students according to the rules framed by the company and then he set out certain rules. He also stated what the name of the trust would be. The document ended as follows. "I shall execute at my own expense a trust deed and sign and give the same to the company, entering therein, all the above mentioned particulars and conditions. The 91 company shall accept the same and shall mention the fact of acceptance in the deed in writing and shall get the same registered". On the same day the directors seem to have resolved as follows: "It is decided to accept this trust property in accordance with the conditions, mentioned in it. Copies of this resolution and the application, may be sent to the applicant". The company agreed to accept the trust and a sum of Rs.7672 7 3 which had been given to the appellant by the respondent company was returned on April 30, 1944. On July 2, 1944, the appellant placed before the Board of Directors a draft of the trust deed which is Exhibit IT. The draft of the trust deed was approved by the company as follows: "The company has accepted the properties as 'Trust ' with all the above conditions. To this effect, the Directors (Trustees) who have been authorised as per the decision of the Director Board, on behalf of the Dharmodeyam Company. The draft of the 'Trust deed ' has been perused and accepted. Four Trustees have been empowered to prepare the original deed and present it in the Registrar 's Office " . It appears that at a meeting of the General Body of the Members of the Company this trust deed was approved. Later on February 25, '1945 another meeting was held and certain changes were suggested in the trust deed. On October 7, 1944, certain members of the respondent company filed a suit in" the court of District Munsif of Trichur and obtained an injunction both against, 92 the appellant and the company not to execute the trust deed as had been proposed by the appellant as contained in the draft (Exhibit II). Thereafter the appellant resigned his Chairmanship of the respondent company on May 25, 1945 and also ceased to be a Director on May 28, 1945. Two days before i.e. on May 23, 1945 the appellant registered a trust deed in regard, to the property which is Exhibit X. It is there stated that he had constructed the building at his own expense at a cost of Rs 75,000/ and it was to be named Dharmodayam Company Silver Jubilee 11 lyyappan Trust Building. The first trustee was the appellant with power to appoint other trustee or trustees. The estimated income of the property was Rs. 3600/ out of which a rent of Rs 88/ per annum was to be paid to the appellant company for the compound where the building had been erected and then provision was made in regard to the income and how it wag to be spent. This was registered and thus a trust was created of the properties in schedule A & B in which the trust became a tenant of the respondent company without any transfer from the respondent Company to the trust. The suit for injunction which had been filed by some of the members was dismissed for default on March 25, 1946. The respondent company on August 13, 1945, called upon the appellant to band over the building to the respondent company and it is stated that on August 22, 1945, during some holidays the appellant inducted the 5th defendant as a tenant. The respondent thereupon filed the suit out of which this appeal has arisen. The plaintiff in his plaint, after reciting the facts which have been above set out, stated that the appellant as an agent of the respondent company had misconducted himself by the breach of his duties and had thereby lost any right he had regarding the building described in schedule B; 93 that he had wilfully contravened the terms of his offer ; that the right of the appellant therefore was only to recover the money from the company to the extent to which he may be entitled in equity and the trust deed (Exhibit X) was inoperative. The respondent further stated that it was ready and willing to pay such sum of money as the court may find the appellant to be entitled to. The defence of the appellant was that the offer of the appellant to construct the building and to constitute the company as trustee to carry out the trust according to the terms and conditions detailed in his offer dated 2, 1944 having been accepted by the Board of Directors, it put an end to any previous relationship which might have existed between the appellant and the respondent company and could not therefore be enquired into. It was also submitted that the respondent company was estopped from claiming the building after having accepted the aforesaid offer pursuant to which the appellant had invested a large sum of money in constructing the building; that as the offer of the trusteeship of the property in dispute made by the appellant and accepted by the Board of Directors of the respondent company had afterwards been cancelled as a result of the resolution passed by the General Body ' of Members the appellant could not constitute the respondent company as trustee and therefore he was entitled to implement his original intention by executing the deed of trust (Exhibit X.). He therefore pleaded that the deed of trust was perfectly valid: that the rental value of the site in schedule A was not even Rs. 10/ a year and that he had not be. come a tenant and the word "verumpattom" had been used for the want of a better word and that the trust had undertaken the liability to pay to the respondent company Rs. 88/ a year. On these grounds it was submitted that the respondent company was not entitled to any relief. These then are the facts of the case. 94 The appellant in this Court has mainly relied on the plea that he had been granted a licence and acting upon the license he 'had executed a work of a permanent character and incurred expenses in the execution thereof and therefore under section 60(b) of the (5 of 1882), hereinafter referred to as the 'Act ', which was applicable to the area where the property is situate and therefore the license was irrevocable. Now in the trial court no plea of license or its irrevocability was raised but what was pleaded was the validity of the trust in Exhibit X. In the judgment of the trial court no such question was discussed. In the grounds of appeal in his appeal to the High Court which the appellant took against the decree of the trial court the relevant grounds are 9 to 13. In the 9th ground it was pleaded that the first de fendant 's case of lease should have been upheld; in any event s.60 of the Act should have been applied. In Ground No. 10 it was stated that Rs. 88/ was a reasonable compensation. Grounds 11 to 13 dealt with the question of trust. Thus it is for the first time in his grounds of appeal that section 60 of the Act was sought to be raised as an alternative plea. At the time of the argument before the High Court the appellant abandoned his case in regard to the lease and relied on the irrevocability of the license and insisted that the trust deed (Exhibit X) was a valid document. Now it is not open to a party to change his case at the appellate stage because at the most the case of the appellant in the trial court was what was contained in paragraph II of the Written Statement where the question of estoppel was raised and the plea taken was that the respondent company was estopped from claiming any right to the building after accepting the offer of the appellant pur suant to which the appellant had expended a large amount of money, That was not a plea of license at that stage. it is not for us to say what the ease of the parties would have been if the case of 95 license had been specifically raised but the fact remains that the plea of license was not raised in the trial court nor was it adjudicated upon there. The appellant was a Director of the company and it is now impossible to dispute the proposition that the Directors are in some sense, trustees a proposition which has been established by a long series of cases. See Palmer 's Company Law p. 158, Ed. 19th. This two fold character of directors is, perhaps, best expressed in Lord Belborne 's words in G. E. Ry. vs Rurner(1) where he said: The directors are the more trustees or agents of the company trusees of the company 's money and property ; agents in the transactions which they enter into on behalf of the company. And this is the way in which it is put by Sir George Jessel in the case of Re Forest Of Dean etc. , Co. (1878) 10 Ch. D. 450. Directors are called trustees. They are no doubt trustees of assets which have come into their hands, or which are under their control". Thus when the appellant was making the offer for creating a trust he was not merely an agent of the company; he was also a trustee of the assets of the company and was in a fiduciary relationship with the respondent. Therefore the appellant could not, do anything in regard to the assets of the company which would prejudicially affect its rights. The appellant made an offer that he would errect the buil ding on the land belonging to the respondent which .is in schedule A, the building being schedule B. He also offered that it would be a trust property i.e. the super structure would be the trust property. He could not create a trust in regard to land which belonged to the company nor could he by a unilateral act create a lease in his own favour in regard to (1) , 152. 96 the land which is in schedule A. Thus when a complaint is made that the appellant has unilaterally acted to deprive the company of some of its right the complaint. is not wholly without foundation, although the company also may not be entirely without blame. But the fact comes to this the appellant was asked to construct the building at a cost of Rs. 12,000; it was subsequently found that the cost would be more than the estimated amount which probably the company was not prepared to spend. It is not that the building had not yet commenced, it had commenced and probably not completed. At that stage the appellant made an offer which was accepted but the offer was that he would finish the construction of the building and hand it over to the respondent company as trust property of which the trustees would be the Directors of the company. The transaction therefore was confined to the offer as contained in Exhibit AB and in Exhibit 11. It is true that for some reason or another certain members of the company were not prepared to stick to the original arrangement and wanted certain modifications but in spite of that it was not open to the appellant to ignore his offer altogether and create a wholly new trust which he has done. His right, if any, if they could be enforced would only be in Exhibit 11 which the appellant himself has abandoned. He cannot now be heard to say that because the company after accepting his offer had refused to abide by the agreement, he was entitled, to appropriate by means of the trust created by him the land in schedule A by constituting the trust a tenant and deprive the company of which he was at that time a Director and therefore a trustee. In these circumstances it is impossible to say that there were any equities in his favour which he is entitled to. enforce by way of defence to the suit of the respondent. 97 In our opinion no case of license really arises but if it does what is the license which the appellant obtained and what is the license, which he is seeking to plead as a bar. The license, if it was a license, was to construct the building and hand it over to the respondent company as trust property. There was no license to create another kind of trust which the appellant has sought to create, It cannot be said therefore that there was an irrevocable license which falls under section 60 (b) of the Act. Even such a license is deemed to be revoked under section 62 (f) of that Act where the license is granted for a specific purpose and the purpose is attained or abandoned or becomes impracticable. In the present case the purpose for which the license was granted has either been abandoned or has become impracticable because of the action of the appellant. In these circumstances the cases which were cited on behalf of the appellant are of little assistance. The appellant relied on Manzoor Ahmad vs Muhammad Abdul Jamil(1) which was a case under a. 60 (b) of the Easements Act where a license had become irrevocable under section 60 (b) and it was held that it could not be revoked on payment of com pensation. The East Punjab case. Dominion of India vs B. B. Sohan Lal (2) again is not of much assistance of the appellant. It was there stated that in every case the terms of the license have to be examined and the law applied to such terms. It was also observed by Das, C. J. (as he then was) that in order to be irrevocable under section 60 the license has to be coupled with a transfer of property whereas under the English law it was enough if it was coupled with a grant or interest in the nature of profit and in every ease the irrevocability whether under the English law or under the Indian ' statute will give way to the special (1) ALL. (2) A.I.R. 1950 E.P. 40, 47. 98 agreement if any of the parties but it is unnecessary to go into these cases because the offer which was originally made by the appellant and accepted by in the respondent company has not been adhered to and the appellant is not proceeding on an entirely new basis. In our opinion the offer and the acceptance of the terms of the trust deed being wholly different from what has now been executed by the appellant and from the manner in which the new trust has been constituted into a lessee of the company without the company 's agreement it is not possible for a court in equity to accept the new trust as a bar to the respondent 's claim for possession. In this case the appellant has suffered no loss. The amount which he has expended has been returned to him. In our opinion the judgment of the High Court was right and we therefore dismiss this appeal with costs. Appeal dismissed.

The respondent, a Company with charitable objects owned certain lands and the appellant who was the Chairman of the Board of Directors, was asked to construct a building on the said land. It was subsequently found that the cost. would be more than the estimated amount, which probably the Company was not prepared to spend. At that stage the 86 appellant made an offer that he would finish the construction of the building at his own cost and hand it over to the Company as trust property of which the Directors of the company would be the trustees and the Company will manage the affairs in accordance with the conditions laid down in his offer. The offer was accepted, but for some reason or other certain members of the Company were not prepared to stick to the original arrangement and some of the members filed a suit and obtained an injunction against the appellant and the company not to execute the trust deed as proposed by the appellant. Thereafter the appellant resigned from Chairman ship and also ceased to be a Director, two days before his resignation he appellant registered a trust deed and made himself the first trustee with powers to appoint other trustees. The trust deed inter alia, recited that a rent of Rs. 88/ per annum was to be paid to the Company for the compound where the building had been erected. Thus the appellant created a trust by which the trust became a tenant of the respondent Company without any transfer from the Company to the trust. The respondent Company called upon the appellant to hand over the building to the Company and file a suit for possession of properties, damages and mesne profit. The respondent Company 's case was that the appellant had wilfully contravened the terms of his offer, and the right of the appellant therefore 'was only to recover the money from the Company to the extent to which he may be entitled in equity and the trust deed was inoperative. The defence of the appellant inter alia was that the respondent company was estopped from claiming the building after having accepted the aforesaid offer pursuant to which the appellant had invested a large sum of money in constructing the building; and that as the offer of the trusteeship of the property in dispute made by the appellant and accepted by the Board of Directors had afterwards been cancelled as a result of the resolution passed by the general body of members, the appellant could not constitute the respondent company as trustee and therefore he was entitled to implement his original intention by executing the deed of trust. In the Supreme Court, the appellant relied on the plea that he had been granted a license and acting upon the license he had executed a work of permanent character and incurred expenses in the execution thereof and therefore under section 60(b) of the , the license was irrevocable. Held, That a Director is also a Trustee of the assets of the company and is in a fiduciary relationship with the company; therefore he could not do anything in regard 87 to the assets of the Company which would prejudicially affect its rights. A person cannot create a trust in regard to land which belonged to another person nor could he by an unilateral act create a lease in his own favour in regard to the land over which he has raised a super structure. The offer and the acceptance of the terms of the trust deed being wholly different from what had been executed by the appellant and from the manner in which the new trust had been constituted into a lessee of the company without the company 's agreement it was not possible for a Court in equity to accept the new trust as a bar to the respondent 's claim for possession and there are no equities in the appellant 's favour which he is entitled to enforce by way of defence to the suit. Held, further, that no case of license really arises but if it does, the license was to construct the building and hand it over to the respondent company as trust property. There was no license to create another kind of trust which has been sought to be created. It cannot be said, therefore, that there was an irrevocable license which fall under section 60(b) of the . Even such a license is deemed to be revoked under section 62(f) of the Act where the license is granted for a specific purpose and the purpose is attained or abandoned or becomes impracticable. G. E. By. vs Rurner , Manzoor Ahmad vs Muhammad. Abdul Jamil, (1933) 1. L. R. 56 All. 207 and Dominion of India vs B. B. Sohan Lal, A. 1. R. 1950 E.P. 40, referred to.

Appeal No. 340 of 1959. Appeal by special leave from the judgment 953 and order dated May 21, 1958, of the Punjab High Court in Revision Application No. 27 of 1958. M.C. Setalvad, Attorney General of India, section N. Andley, Rameshwar Nath and P. L. Vohra, for the appellant. H.N. Sanyal, Additional Solicitor General of India, and I. N. Shroff, for the respondent. March 20. The Judgment of the Court was delivered by DAS, J. This is an appeal by special leave from the judgment and order of a learned single Judge of the Punjab High Court dated May 21, 1958, hi Civil Revision application No. 27 of 1958 of that Court. By that order the learned single Judge dismissed an application in revision made by the appellant herein in the following circumstances. The appellant, Maharaj Jagat Bahadur Singh is the owner of the premises known as Ranzor Hall in Simla. The respondent, Badri Prasad Seth, is in occupation of the premises as a tenant and is running a cinema ' therein which is known as Revoli theatre or Revoli cinema. The correspondence between the parties shows that on or about April 12, 1956 the Executive Engineer, Simla Provincial Division, inspected the cinema building on behalf of the Licensing Authority, namely, Deputy Commissioner, Simla, and noted six defects, one of which was, to use the words of the Executive Engineer, "the right hand pillar of the screen has cracked and has gone out of plumb. " The existence of these defects was communicated to the respondent and also to the Municipal Committee, Simla. The respondent in his turn communicated the existence of these defects to the appellant by a letter dated April 17, 1956. In that letter the respondent suggested to the appellant that the defect in the pillar should be removed before the beginning of June, 1956, when the rains were likely to 954 commence. The respondent removed the other defects which were of a minor nature; but getting no reply from the appellant, he again wrote to him on September I 'd, 1956, and asked him to take early steps to repair the pillar to avoid any mishap. The respondent also intimated to the appellant that the cost of repairs to the pillar was likely to be in the neighbourhood of Rs. 5000/ . The appellant took no action in the matter for some time. On September 24, 1956 the East Punjab Urban Rent Restriction Act, 1949 'East Punjab Act No. III of 1949) (hereinafter referred to as the Act) was amended and a clause was inserted in section 13(3)(a) thereof which entitled the landlord to apply to the Rent Controller for an order directing the tenant to put the landlord in possession in the case of any building if he required it to carry out any building work at the instance of the Government or local authority or any Improvement, Trust under some improvement or development scheme or if the building had become unsafe or unfit it for human habitation. Oil April 9, 1956, the appellant wrote to the President, Simla Municipal Committee, asking him to get the pillar in the Ranzor Hall inspected by the Executive Engineer in order to have his opinion whether the pillar was really in a dangerous condition and required any action on the part of the Municipal Committee under section 116 of the Punjab Municipal Act, 1911 (Punjab Act III of 1911). On October 30, 1956, the Secretary, Municipal Committee, Simla, wrote to the respondent about the defect in respect of the right hand pillar of the screen and required the respondent by means of a notice to do the repairs within fifteen days of the receipt of the notice. The Secretary issued the notice purporting to act under so. 113 and 114 of the Punjab Municipal Act, 1911. It appears that the Municipal Committee had the pillar inspected again in November, 1956, by the Executive Engineer, 955 Simla Central Division. This time the Executive Engineer suggested that the two end. walls (pillars) supporting the beams for the screen were cracked and therefore must be replaced by thicker walls. The Municipal Committee considered this report and came to the conclusion that as a precautionary measure what was necessary was to fill the doorway in the pillar with masonry so that the whole might become a solid block. On April 11, 1957, the Municipal Committee wrote to the appellant asking the latter to fill the doorway with masonry so that the whole pillar might become a ,solid block. This was in modification of the earlier notice which had suggested more extensive repairs to the pillar. But before April 11, 1957, when the new notice from the Municipal Committee was received, the appellant had already made an application on December 1,1956, under section 13 of the Act praying for an order from the Controller directing the respondent to put the appellant in possession of the property on the ground that the appellant required the building for replacing the end walls supporting the beams of the screen by thicker walls. This application was contested by the respondent mainly on the ground that the appellant 's claim was not bona fide and that the appellant did not really require the building to be vacated for the purpose of making the repairs to the pillar in question. The Rent Controller came to the conclusion that the case was fully covered by cl. (iii) of 8.13 (3)(a) of the Act inasmuch as on the evidence on the record it was established that the appellant required the building to carry gut the necessary building work which the Municipal Committee, Simla, had directed to be done,. There was an appeal from the order of the Rent Controller to the District Judge who was the relevant appellate authority under s.15 of the Act. The learned District Judge came to the conclusion that the notices under a. 113 and 114 of the Punjab Municipal 1, had been manipulated by the landlord after the amendment made in a. 13 of the Act on September 24, 1956, and that the appellant did not bona fide require the building for carrying out the repairs in question. The learned District Judge pointed out that on April 11, 1957 the Municipal Committee had asked the landlord to fill the doorway with masonry so that the whole might become a solid block and though the Municipal Committee bad modified its earlier requirement of thicker walls by means of a notice after the filing of the application by the appellant, it was open to the Court to take into consideration facts which had come into existence after the filing of the application. He also pointed out that the evidence of the Executive Engineer, Central P.W.D., showed that he inspected the building on June 8, 1957, in the compliance with the directions of the Court and was satisfied that the pillar had been satisfactorily repaired. In this view of the matter the learned District Judge allowed the appeal and dismissed the application. Then, there was an application in revision under a. 15(5) of the Act to the High Court. This application was dealt with by K. L. Gosain, J. who wrongly proceeded on the footing ,that the application in revision was one under section 115, Code of Civil Procedure. Though the learned Judge said that he had gone through the evidence and agreed with the findings arrived at by the District Judge,. he came to the conclusion that as no question of jurisdiction was involved within the meaning of s.115, Code of Civil Procedure, he saw no reasons to interfere and dismissed the application in revision. The present appeal is directed against this order of the learned single Judge. The learned Attorney General who appeared on behalf of the appellant has rightly pointed out that the, learned Judge of the High Court was in 957 error in disposing of the case as though the application in revision made to the High Court was an application under a. 115, Code of Civil Procedure. The application was really an application under a. 15(5) of the Act which is in these terms "15. (5) The High Court may, at any time, on the application of any aggrieved party or on its own motion, call for and examine the records relating to any order passed or proceedings taken under this Act for the purpose of satisfying itself as to the legality or propriety of such order or proceedings and may pass such order in relation thereto as it may deem fit. " It is manifest that the scope of sub a. (5) of a. 15 of the Act is not the same as the scope of a. 115, Code of Civil Procedure. The learned Attorney General has submitted, rightly in our opinion, that the scope of sub a. (5) of a. 15 of the Act is wider and is not confined to questions of jurisdiction only. But even if the learned Judge of the High Court was in error in treating the application as one under a. 115, Code of Civil Procedure, the fact ' still remains that he affirmed the findings of the learned District Judge and one of these findings was that the landlord did not require the building to carry out the repair work which was suggested by the Municipal Committee. The Municipal Committee had suggested a very simple work of repair, namely, filling up of the doorway in the pillar so that the pillar might be one solid wall to support the screen. It has not been seriously disputed before us that such repairs could be easily carried out with. out the necessity of asking the respondent to vacate the building. As a matter of fact the learned Dis trict Judge has pointed out that the Executive Engineer, Central P.W.D. had, subsequent to the application, examined the pillar and found that 958 the repair work had already been done 'by the respondent. The learned Attorney General has contended that the learned District judge was in error in holding that the appellant had manipulated the notices under section 113 and 114 of the Punjab Municipal Act. We think it unnecessary to go into that question because the relevant provision in section 13(3)(a) of the Act makes it quite clear that the landlord is entit led to an order from the Controller directing the tenant to put the landlord in possession of the building only when the landlord requires it to carry out any building work etc. The relevant provision reads as follows .lm15 "13. (1) A tenant in possession of a building or rented land shall not be evicted therefrom x. x x except in accordance with the provisions of this section, x x x. (2) x x x. (3) (a) A landlord may apply to the Controller for an order directing the tenant to put the landlord in possession (1) x x x (ii) x x x (iii)in the case of any building or rented land if he requires it to carry out any building work at the instance of the Government or local authority or any Improvement Trust under some improvement or development scheme or if ' it has become unsafe or unfit for human habitation. x x X. We emphasise the word "requires" in the provision. Having regard to the scheme and purpose of the legislation it is abundantly clear that cl. (iii) of 959 a.13(3)(a) of the Act is attracted only when the building work is such that the landlord requires that the building be vacated by the tenant in order to carry out the work ; in other words, the repairs needed are so extensive and fundamental in character that they cannot be carried out if the tenant remains in possession. Then only it can be said that the landlord requires the building to carry out the building work. We think that it is absurd to suggest that any such small work as whitewashing, or filling up the gap in the doorway as in the present cage, comes within el. (iii) of section 13(3)(a) of the Act. The learned Attorney General has argued that the learned District Judge wrongly took into consideration facts which had come into existence after the filing of the application under section 13 of the Act. Here again we think that having regard to the scheme and purpose of the. legislation it was open to the learned District Judge to take into considera tion such facts as existed at the time when the order for vacation was to come into effect. Section (13) says that the Controller shall, if he is satisfied that the claim of the landlord is bona fide, make an order directing the tenant to put the landlord in possession of the building on such date as may be specified by the Controller. In the present case the Controller made the order in July, 1957, and directed the building to be vacated by September 25, 1957. But long before that date, namely, on June 8, 1957, the Executive 'Engineer, Central P.W.D., had inspected the building and found that the pillar had been repaired satisfactorily. The ,Controller did not accept the testimony of the Executive Engineer and the learned District Judge pointed out that the testimony of the Executive Engineer had been rejected by the Controller on very insufficient grounds. It was, open to the learned District Judge to take into consideration the testimony of the Executive Engineer and having regard 960 to that testimony, the learned District Judge rightly came to the conclusion that cl. (iii) of a. 13(3) (a) of the Act was not attracted to the case. For these reasons we have come to the conclusion that there is no merit in the appeal which is accordingly dismissed with costs. Appeal dismissed.

Appellant landlord applied to the Rent Controller for eviction of the Respondent tenant on 1.12.56 under section 13(3) of the Punjab Urban Rent Restriction Act for remedying certain defects in the based building. The Municipal Commi ttee on 11.4.57 issued an amended notice requiring only that the cracked pillar be reinforced so as to make it a solid block. Respondent carried out the repairs. On June 8, 1957, the Executive Engineer inspected again in compliance with tile order of the Rent Controller And was satisfied that the pillar had been repaired satisfactorily. The Rent Controller held that the case fell within section 13 (3) (a) of the Act and ordered eviction of the Respondent. On appeal the District judge taking note of the state of repairs allowed the appeal. In revision under section 15(5) of the Act the High Court judge held that the powers of the High Court in revision were similar to those under section 115 of the Civil Procedure Code and that there was no question of jurisdiction involved in the case. He, however, affirmed the decision after considering the evidence. Held, that the powers of the High Court under section 15 (5) of the Act were manifestly wider than those under section 115 of the Civil Procedure Code and were not confined to questions of jurisdiction. That under section 13(3z(a) the requirement of vacant possession. by the landlord could only be for the purpose of carrying out such fundamental and extensive repairs as could not be carried out without evicting the tenant and not for minor repairs and that it Was open to the District Judge to consider the subsequent events upto the time when eviction was ordered by the controller in view of the scheme and purpose of the legislation.

Appeal No. 507 of 1960. Appeal from the judgment and decree dated March 19, 1958, of the ' Punjab High Court (Circuit Bench) at Delhi in R. F. A. No. 299 of 1951. K. L. Gosain, R. Ganapathy Iyer and G. GopalaKrishnan, for the appellant. B. Sen and P. D. Menon, for the. respondent. March 27. The Judgment of the Court was delivered by WANCHOO, J. This appeal on a certificate granted by the Punjab High Court raises a question as to the interpretation of article 31 of the Limitation Act. The appellant had brought a suit in forma pauperis for recovery of a sum of over Rs. 24,000/from the Union of India in connection with non delivery of certain goods booker with the railway. The appellant was trading in Crujranwala, which is now in Pakistan, under the name and style of G. M. Bootamal and Company and also under the name and style of Gopal Metal Rollin(, Mills and Company he being the sole proprietor of both. On August 5, 1947, just before the partition the appellant handed over two consignments to the North Western 72 Railway at Gujranwala for carriage to Jagadhari and these consignments were booked on the same day by two railway receipts. The consignments however did not reach Jagadhari. The appellant made inquiries and when no delivery was made he made a claim on the railway on November 30, 1947, for the price of the goods not delivered. Later, on January 22, 1948, the appellant gave notice to the railway under section 80 of the Code of Civil Procedure in which it was said that the goods booked under the two railway receipts had not been delivered in spite of repeated reminders and demands from the officials concerned. It was further said that the value of the goods booked was Rs. 24,189/4/ and that the railway was liable for this loss which was due to the negligence of the railway. It was further stated that the cause of action arose on August 21 and 30, 1947 and on subsequent dates when the appellant met with refusal. It was finally said that if the amount was not paid a suit would be brought against the railway. It seems however that in spite this notice correspondence went on between the appellant and the railway and on December 1, 1948, the railway informed the appellant that the two consignments were still lying at Gujranwala and that their despatch had been withheld by the North Western Railway due to restrictions imposed by the Pakistan Government on export. The railway therefore requested the appellant to secure a permit from the Chief Controller , Exports and Imports, Karachi and also from the Custodian of Evacues Property West Punjab and to send the same to the Station Master Gujranwala to enable the goods being sent to Jagadhari. The appellant was also told that in case he failed to produce the requisite permits the consignments would be disposed of in accordance with the law in force in Pakistan, and the railway administration would not be responsible for any loss, damage or destruction to the goods. This seems to have been the end of the correspon 73 dence between the railway and the appellant, and the appellant brought the present suit on December 13, 1949. The suit was resisted by the Union of India and a number of defenses were raised with which we are however not concerned in the present appeal. As many as. seven issues 'Were framed by the trial court, the most important being of limitation. The trial court found in favour of the appellant on all the issues including limitation and gave him a decree for Rs. 24,189/4/ . It however ordered the parties to bear their own costs. Thereupon there was an appeal by the respondent to the High Court, and the main point pressed there was that the suit as filed on December 13, 1949, was barred by limitation. Under article 31 of the Limitation Act time begins to run against a carrier for compensation for non delivery of or delay in delivering goods from the time "when the goods ought to be delivered". The question canvassed in the High Court was the interpretation of these words in article 31. It appears that there had been difference of opinion in the High Court as to the meaning.to be attached to these words in Art 31 and a reference had been made to a Full Bench in another case, namely, Dominion of India vs Firm Aminchand Bholanath (C.A. 97 of 1949, decided on May 2, 1956). In that reference the Full Bench held that "the limitation tinder article 31 starts on the expiry of the time fixed between the parties and in the ' absence of such agreement, the limitation starts on the expiry of reasonable time which is to be decided according to the circumstances of each case. " The High Court therefore followed the view taken in that case and held after taking into account the circumstances prevailing in August 1947 that the goods ought to have been delivered at the most within five or six months of the booking and therefore the suit was 'barred by limitation as it was brought in December 1949, the period of limitation being only one year. The High Court therefore allowed the appeal, set aside the decree of the trial court and dismissed the suit. It however ordered the parties to bear their costs. As the case involved a substantial question of law the High Court granted a certificate to the appellant; and that is how the matter has come up before us. Article 31 reads as follows ____________________________________________________________ Description of suit Period of Time from limitation which period beings to run. ____________________________________________________________ x x x x x x x x x 31 Against a carrier One year When the goods for compensation for ought to be delivered. non delivery of, or delay in delivering goods. Its interpretation has been the subject of a number of decisions by various High Courts in India and the question that has been considered in these decisions is as to the time from which the period begins to run. Under the Article, the time begins .to run ,when the goods ought to be delivered" and one should have thought that there would be no difficulty in finding out the meaning of these words. Ordinarily, the words of a statute have to be given their strict grammatical meaning and equitable considerations are out of place, particularly in provisions of law limiting the period of limitation for filing suits or legal proceedings. ' This was laid down by the Privy Council in two decisions in 75 Nagendranath vs Suresh(1)and General Accident Fire and Life Assurance Corporation Limited vs Janmahomed Abdul Rahim (2). In the first case the Privy Council observed that "the fixation of periods of limitation must always be to some extent arbitrary and may frequently result in hardship. ' But in construing such provisions equitable considerations are out of place, and the strict grammatical meaning of the words is the only safe guide". In the latter case it was observed that "a limitation Act ought to receive such a construction as the language in its plain meaning imports. . Great hardship may occasionally be caused by statutes of limitation in cases of poverty, distress and ignorance of rights, yet the statutory rules must be enforced according to their ordinary meaning in these and in other like cases. " Two lines of reasoning seem to have governed the decisions of various High Courts on the interpretation of these words in the third column of article 31. The first is based on the consideration that it was for the railway to prove what time ought to 'be taken for the delivery of the goods and therefore limitation can only start when the railway says finally that it cannot deliver the goods. The second line of reasoning seems to be based on the principle of estoppel and is to the effect that where the railway enters into correspondence and says that efforts are being made to trace the goods the railway would be estopped from pleading that the time began to run from sometime anterior to the period before the correspondence on the question came to an end. It may however be noted that though the majority of the decisions follow these two lines of reasoning and hold that time begins to run only when the railway finally refuses to deliver the goods, here and there a dissentient note has also been struck. We shall consider some of these cases later. (1) A.I.R. (1932) P.C. 165. (2) 76 Let us first see what these words in article 31 mean on a plain grammatical construction. It would be noticed that article 31 as it now stands after the Limitation Act of 1877 and 1909, governs two class of cases, namely, (i) where there has been no delivery of goods and (ii) where there has been delay in delivering goods. In both class of cases the time begins to run from the date when the goods ought to be delivered. These words therefore in column three of the Article must have a meaning which will apply equally to the two situations envisaged in column one. Whether there has been nondelivery or there has been delay in delivery, in either case limitation would run from the date when the goods ought to be delivered. Now it is not in dispute that if there is a term in a contract of carriage fixing when the goods have to be delivered that would be the time "when the goods ought to be delivered" within the meaning of the words used in the third column of article 31. The difficulty however ' arises in that class of cases where there is no term in the contract of carriage, whether express or im. plied, from which the date on which the goods have to be delivered, can be inferred. It is in these cases that the question of interpretation of the words in the third column of article 31 seriously arises. But these words can only mean one thing whether it is a case of late delivery or of nondelivery. Reading the words in their plain grammatical meaning they are in our opinion capable of only one interpretation, namely, that they contemplate that the time would begin to run after a reasonable period has elapsed on the expiry of which the delivery ought to have been made. The words "when the goods ought to be delivered" can only mean the reasona ble time taken (in the absence of any term in the contract from which the time can be inferred expressly or impliedly) in the carriage of the goods from the place of despatch to the place of destination. Take the case, where the cause of action is 77 based on delay in delivering the goods. In such a case the goods have been delivered and the claim is based on the delay caused in the delivery. Obviously the question of delay can only be decided on the basis of what would be the reasonable time for the carriage of goods from the place of despatch to the place of destination. Any time taken over and above that would be a case of delay. Therefore, when we consider the interpretation of these words in the third column with respect to the case of non. delivery, they must mean the same thing, namely, the reasonable time taken for the carriage of goods from the place of despatch to the place of destination. The view therefore taken by some of the High Courts that the time begins from the date when the railway finally refuses to deliver cannot ,be correct, for the words in the third column of article 31 are incapable of being interpreted as meaning the final refusal of the carrier to deliver. We may in this connection compare the language used in the third column of article 31 with certain other articles of the Limitation Act which will show that. where the legislature intended that time should run from the date of refusal it has used appropriate words in that connection. For example, in article 18, which provides for a suit for compensation against Government when the acquisition is not completed, the time begins to run from "the date of the refusal to complete". Similarly, in article 78 which provides for a suit by the payee against the drawer of a bill of exchange which has been dishonoured by non acceptance, time begins to run from "the date of the refusal to accept". Again in article 131 which provides for a suit to establish a periodically recurring right, ' the limitation begins to run "when the plaintiff is first refused the enjoyment of the righe '. Therefore, if the legislature intended that in case of non delivery, the limitation would start on the final refusal of the carrier to deliver, such a case would have been provided for by a separate article and we 78 would have found appropriate words in the third column thereof. The very fact that article 31 deals with both cases of non delivery of goods and delay in delivering the goods shows that in either case the starting point of limitation is after reasonable time has elapsed for the carriage of goods from the place of despatch to the place of destination. The fact that what is reasonable time must depend upon the circumstances of each case and the further fact that the carrier may have to show eventually what is the reasonable time for carriage of goods would .in our opinion make no difference to the interpretation of the words used in the third column of article 31. Nor do we think that their could be generally speaking any question of estoppel in the matter of the starting point of limitation because of any correspondence carried on between the carrier and the person whose goods are carried. But, undoubtedly, if the correspondence discloses anything which may amount to an acknowledgement of liability of the carrier that will give a fresh starting. point of limitation. A we have said already, the words in 'the third column refer to reasonable time taken for the carriage of goods from the place of despatch to the place of destination and this reasonable time generally speaking cannot be Affected by the subsequent conduct of the parties. We are therefore of opinion that the answer given by the Full Bench in the case of Aminchand Bholanath (supra) that "the limitation in such cases starts on the expiry of the time fixed between the parties and in the absence of any such agreement the limitation starts of the expiry of reasonable time which is to be decide according to the circumstances of each case," is correct. We shall now consider some of the representative cases decided by High Courts in this connection. In Jugal Kishore vs The Great Indian Peninsala Railway(1) it was observed that "when the X.I. Railway Company, by its own conduct made the (1) All 43. 79 plaintiff await the result of the inquiry, it is rather ,startling to find the plea of limitation raised in defence on its behalf". It was further observed that "the correspondence between the parties shows that the matter was being inquired into and that there was no refusal to deliver, up to well within a year of the suit ; in the circumstances of the case we are unable to hold that the suit was instituted more than a year from the expiry of a reasonable, time within which the goods should have been delivered. " This decision seems to suggest that the meaning of the relevant words in the third column is that limitation starts from the expiry of the reason. able time within which the goods should have been delivered. But it has taken into account the subsequent conduct of the railway and the fact that there was no refusal to deliver the goods till much later. It was therefore held that as the suit was brought within one year of the final refusal to deliver, it was within time. With respect, it is rather difficult to understand how the subsequent correspondence between the railway and the consignor or the consignee can make any difference to the starting point of limitation, when that correspondence only showed that the railway was trying to trace the goods. The period that might be taken in tracing the goods can have no relevance in determining the reasonable time that is required for the carriage of the goods from the place of despatch to the place of destination. In Bengal and North Western Railway Company vs Maharajadhiraj Ramhwar Singh Bahadur(1) it was held that "the defendants (i.e. Railway) by a deliberate process of ignoring the plantiff"s repeated requests for attention to his claim misled him into delaying his suit and it is not open to them (1) Pat. 67, 77. 80 now to contend that the suit has been brought too late. " This case seems to be based on estoppel. But here again we find it difficult to understand how the starting point of limitation under. article 31 could be changed because the railway ignored the plaintiff 's requests for attention to his claim. In Jai Narain vs The Governor General of India (1) it was held that ""the time 'when the goods ought to be delivered ' within the meaning of article 31 is not the time when they should have been delivered in the normal course, it least in a case where there is no time fixed for delivery, but the time when they ought to be delivered according to the sub sequent promises by the railway which informs the parties that it is carrying on enquiries. " With respect we, find it difficult to find bow in the face of the clear words in the third column of article 31 the starting point of limitation can be changed because of the subsequent conduct of the railway, which informed. the consignor or consignee that ' it was making enquiries to trace the goods. Finally in, Governor General in Council vs section Ahmed(2). it was held that "cannot be overlooked that for some time the railway authorities themselves were hoping to deliver the remaining packages and were making inquiries all along the route. In such cases it is not fair to expect the plaintiff to rush to Court with a suit without waiting for the result, of the inquiries. Limitation can therefore begin only when there was a definite statement by the railway authorities that they were not in a position to deliver the goods". With respect, this case seems to read in the third column as if the starting point of limitation is from the final refusal of the railway to deliver the goods, when the actual words may that limitation starts from the time when the goods ought to be delivered i.e. in the absence of any term fixing the time in the contract from (1) A.I.R. (1951) Cal. (2) A.I.R (1952) Nag. 81 the expiry of the reasonable time taken for carriage from the place of despatch to the place of destination. It was however urged for the appellant that even though the words in the third column plainly mean that the time starts when the reasonable period which may be taken for the carriage of the goods from the place of despatch to the place of destination expires, the subsequent conduct of the railway a,% disclosed in the correspondence that might pass between the railway and the consignor or the consignee, might have a bearing on this reasonable time. Now if the correspondence is only about tracing the goods that would not be material in considering the question as to when the goods ought to have been delivered. On the other hand if the correspondence discloses material which might throw light on the question of determining the reasonable time for the carriage of the goods from the place of despatch to the place of destination, then it may be open to the court to take into account the correspondence. Further, if there is anything in the correspondence which has a bearing on the question of reasonable time and the railway wants to go back on that, to that extent the railway may be estopped from denying that. But the correspondence can only be taken into account to determine what would be the reasonable time and not to show that because of the subsequent conduct of the railway the reasonable time got extended by the time taken by the railway in tracing the goods. Where however the correspondence provides material from which reasonable time in a particular case may ' be found out the .correspondence would be relevant to that extent. For example, take a case where the correspondence ,shows that a certain bridge between the place of despatch and the place of destination ' has been ' destroyed on account of floods and that is the reason why the goods have not reached 82 the place of destination. In such a case the correspondence may well be taken into account to find out the reasonable time for the carriage of the goods in the circumstances. This will show that reasonable time will depend upon the facts of each case and that in the absence of any special circumstances the reasonable time would practically be. the same between two stations as would normally or usually or ordinarily be taken for the carriage of goods from the one station to the other. Further there may be no difficulty in finding out the reasonable time where bulk of the goods have been delivered and only a part has not been delivered, for in such a case in the absence of special circumstances it should be easy to see that the reasonable time is that within which the bulk of the goods have been delivered. We may in this connection refer to Union of India vs Meghraj Agarwalla (1) and Gajanand Rajgoria vs Union of India (2) where it has been held that where a part of the consignment has been delivered, that should, in spite of the correspondence regarding inquiries and in the absence of circumstances leading to the contrary view, be taken to be the date when the goods ought to have been delivered as a whole within the meaning of those words in article 31. The view taken therefore by the High Court in Aminchand Bholanath 's case as to the interpretation of the words in the third column of article 31 is in our opinion correct. Let us therefore see what was the reasonable time within which the goods ought to. have reached Jagadhari from Gujranwala in the present case. The appellant himself in his replication stated that the goods in ordinary course should have reached Jagadhari before August 15, 1947. Further in their notice that he gave on January 22, 1948, he stated that the cause of action arose on August 21 and 30, 1947, and on subsequent dates when he met with (1) A.I.R. (1958) Cal. (2) A.I.R. (1955) Pat 182. 83 refusal to deliver the goods. The fact that the appellant gave notice under section 80 of the Code of Civil Procedure in January 1948 in our opinion shows that even taking into account the extra ordinary conditions prevailing on account of the partition of India in August 1947, the appellant was satisfy that the goods ought to have been delivered before January 22, 1948 when he gave the notice. If that was not so and if the cause of action had not arisen, there was no reason why the appellant should have given the notice under a. 80 in January 1948. We can see no difficulty therefore on the facts of this case 'in agreeing with the High Court that the goods 'ought to have been delivered even taking into account the extraordinary circumstances prevailing on account of partition within five or six months of the date on which they were sent, namely, August 5, 1947. This is also home out by the fact that the appellant gave notice on January 22, 1948 i.e. about 5 1/2 months after the goods had been consigned. In the circumstances the suit which was brought in December 1949 would be clearly barred by time, for we cannot take the reasonable time within which the goods ought to have been delivered in the circumstances of this case beyond January 22, 1948, when the notice under section 80 was given. As to the correspondence between the parties it in enough to say that there is nothing in the correspondence which has any bearing on the reasonable time taken for the carriage of goods from Gujranwala to Jagadhari. It is true that on December 1, 1948, the appellant was informed by the Railway that the goods were still lying in Gujranwala because of the restrictions imposed by the Pakistan Government and he was asked to get the necessary permits from that Government ; but that in our opinion has nothing to do with the question of reasonable time to be taken for the carriage of goods from Gujran wala to Jagadhari. In the circumstances, the High Court was right in holding that the suit was barred by limitation under article 31. 84 Learned. counsel for the appellant however drew our attention to the Displaced Persons (Institution of Suits) Act(No. XLVII of 1948) as amended by the Displaced Persons (Institution of suits and legal proceedings) amendment Act, (No. LXVIII of 1950) and contended that the appellant being a displaced person would be entitled to file this suit under section 8 of this Act as amended upto March 31, 1952. It appears that in part 9 of the plaint, the appellant relied on his being a displaced person in order to give jurisdiction to the court in Delhi where he filed the suit. But he does not seem to have relied on his being a displaced person on the question of limitation. The respondent in the written statement denied that the appellant was a displaced person and nothing further happened with respect to this aspect of the matter. Learned counsel for the appellant urges that in fact the appellant is a displaced person and would be entitled to the benefit of the Act of 1948 as amended by the Act of 1950 and on that basis his suit would be within time and that the suit might be remanded to allow the appellant to bring his case under the Act of 1948 as amended. Ordinarily we would not have allowed such a prayer when the point was not raised in the plaint ; but considering that the appellant claims to be a displaced person who is registered in Delhi and also considering that he had to file this suit in forma pauperis probably on account of the circumstances arising from the partition of India, we think that the appellant should be given a chance to prove his case under the Act of 1948 as amended by the Act of 1950. We express no opinion on the question whether the appellant is a displaced person or whether he is entitled to the benefit of the Act of 1948 as amended by the Act of 1950. But we think in the interest of justice he should be given a chance to bring his case under the Act of 1948 as amended, by the Act of 1950 in the matter of limitation subject to his 85 paying all the costs incurred by the respondent upto date irrespective of the result of the suit. We therefore allow the appeal and remand the case to the trial court for considering only the question of limitation on the basis of the Displaced Persons (Institution of Suits) Act, (No. XLVII of 1948) as amended by the Displaced Persons (Institution of suits and legal proceedings) Amendment Act ( No. LXVIII of 1950) after giving parties a chance to lead evidence in this connection, if necessary. If the court comes to the conclusion that the suit is within time on the basis, of these two Acts, a decree for the amount claimed minus the costs incurred upto this date by the respondent will be passed in favour of the appellant. If on the other hand the court comes to the conclusion that the suit is not within limitation ,p a under these two acts the suit will be finally, dismissed Costs incurred hereinafter will be in the discretion of the court Appeal allowed.

On August 5, 1947, the appellant booked two consigments by the N. W. Railway from Gujranwala, now in Pakistan, to jagadhari. The consignments were not delivered and, on January 22, 1948, the appellant gave a notice to the railway under section 80 of the Code of Civil Procedure claiming the value of the goods by way of compensation. It was stated in the notice that the cause of action had arisen on August 21 and 30, 1947, when delivery was refused. On December 1, 1948, the railway informed the appellant that the consignments were still lying at Gujranwala and could be despatched on the appellant obtaining the necessary permits from the Pakistan authorities. On December 13, 1949, the appellant bro ught a suit for compensation for non delivery of the goods. The respondent contended that the suit was beyond time as it was not filed within one year from the time "when the goods ought to be delivered" as prescribed by article 31 of the Limitation Act. Held, that the suit was barred by time. The words "when the goods ought to be delivered" in article 31 had to be given their strict grammatical meaning and equitable consi derations were out of place. Under article 31 limitation started on the expiry of the time fixed between the parties for delivery of the goods and in the absence of any such agreement the limitation started after reasonable time had elapsed on the expiry of which the delivery ought to have been made. The reasonable time was to be determined according to the circumstances of each case. The view taken by some High Courts that time began to run from the date when the railway finally refused to deliver was not correct ; where the legislature intended that time should run from ' the date of refusal it had used appropriate words in that connection. The starting point of limitation could not generally be affected by the conduct of the parties or by the correspondence between them, unless it contained an acknowledgment of liability by the carrier or showed something affecting the reasonable time In the present case delivery ought to have been made within five or six months, as is also indicated by the s, 80 notice given 71 by the appellant and the suit was filed more than a year after that expiry of that time. Dominion of India vs Firm Aminchand Bholanath (F. B.) decided by Punjab High Court on May 2, 1956, approved. Jugal Kishore vs The Great Indian Peninsular Rat (1923) I. L. R. 45 All. 43 ; Bengal and North Western Railway Company vs Maharajadhiraj Kameshwar Singh Bahadur, (1933) I. L. R. 12 Pat. 67, 77 ; Jai Narain vs The Governor General of India, A. I. R. ; and Governor General in Council vs section G. Ahmed, A. 1. R. , disapproved. Nagendranath vs Suresh, A. 1. R. and General Accident Fire and Life Insurance Corporation Limited vs Janmahomed Abdul Rahim, A. I. R. , referred to.

iminal Appeal No. 46 of 1958. Appeal from the judgment and order dated March 17, 1958, of the Allahabad High Court in Criminal Appeal No. 1635 of 1953, 123 A. section R. Chari, section Pichai and section Venkatakrishnan, for the appellant. SarjooPrasad, G.C.Mathur and G.P.Lal, for the respondent. March 28. The Judgement of the Court was delivered by GAJENDRAGADKAR, J. The appellant R.R. Chari was a permanent employee in a gazetted post under the Government of Assam. In 1941, his services were lent to the Government of India. The first appointment which the appellant held under the government of India was that of the Deputy Director of Metals in the Munitions Production Department at Calcutta. Then he came to Delhi on similar work in the office of the Master General of Ordnance which was the Steel Priority Authority during the War period. He was subsequently trans ferred to Kanpur as Assistant Iron a Steel Controller in 1945. Sometime thereafter, he become the Deputy Iron & Steel Controller, Kanpur Circle; which post he held for one month in September, 1945. From January, 1946, be was appointed to the said post and he held that post until September 20 1946. The period covered by the charges which were eventually formed against the appellant and, others is from January 1, 1946 to September 20, 1946. On the latter date, the appellant proceeded on leave for four months and did not return to ' service either under the Government of India or under the Assam Government. It appears that while the appellant had proceeded on leave the Government of India wrote to the Assam Government on February 8, 1947, intimating that it had desided to replace the services of the appellant at the disposal of the Assam Government on the expiry of the leave granted to him with effect from September, 21, 1946. The Government of India also added that the exact 124 period of the leave granted to the appellant would be intimated to the Assam Government later. On April 28, 1947, leave granted to the appellant was gazetted with effect from September 21, 1946 for a period of four months. A subsequent notification issued by the Central Government extended the leave up to May 13, 1947. On this latter date, the Central Government suspended the appellant, and on a warrant issued by the District Magistrate, Kanpur, he was arrested on the October 28, 1947. Subsequently, he was released on bail. Thereafter, the Government of India accorded sanction for the prosecution of the appellant under section 197 of the Criminal Procedure Code on the January 31, 1949. A Charge sheet was submitted by the prosecution alleging that the appellant along with three of his former assistants had committed various acts of conspiracy, corruption and forgery during the period 1, 1.1946 to 20 9 1946 The other persons who were alleged to be co conspirators with the appellant, were vaish, a clerk in charge of licensing under the appellant, Rizwi and Rawat who were also working as clerks under the appellant. Bizwi abs conded to Pakistan and Rawat died. In the result, the case instituted on the ,,aid charge sheet proceeded against the appellant and Mr. Vaish. Broadly stated the prosecution case was that during the period December 1945 to September 20, 1946, the appellant and Vaish and other entered into a criminal conspiracy to do illegal acts, such as the commission of offenses under, sections 161, 165, 467. Indian Penal Code or in the alternative, Offenses such as were prescribed by r. 47 (3) read with r. 47 (2) of the Defence of India Rules, 1939 and. abetment in the acquisition and sale of Iron and .steel, in contravention of the Iron and Steel (Control of Distribution) Order 1941 ; and that in pursuance of the said conspiracy, they did commit the aforesaid illegal acts from time to time and thus rendred themselves liable to be punished under s.120 B 125 of the Indian Penal Code. That was the substance of the first charge. The Second Charge was in regard to the commission of the offence under section 161 and it set out in detail the bribes accepted by the appellant from 14 specified persons. In the alternative, it was alleged that by virtue of the fact that the appellant accepted valuable things from the persons specified, he had committed as offence under section 165 Indian Penal Code. The third charge was under section 467 Indian Penal Code or in the alternative, under r. 47(3) read with r. 47(2) (a) of the Defence of India Rules. The substance of this charge was that in furtherance of the conspiracy, the appellant fraudulently or dishonestly made, signed or executed fourteen documents specified in clauses (a) to (n) in the charge. Amongst these documents were included the orders prepared in the names of several dealers and licences issued in their favour. The fourth charge was that the appellant had abetted the firms specified in clauses (a) to (k) in the commission of the offence under r 81(2) of the Defence of India Rules. That, in brief, is the nature of the prosecution case against the appellant as set out in the several charges. At the initial stage of the trial, the appellant took a preliminary objection that the sanction accorded by the Government of India to the prosecution of appellant under section 197 Code of Criminal Procedure was invalid. This objection was considered by Harish Chandra J. of the Allahabad High Court and was rejected on the July, 18th 1949. The learned Judge directed that since he found no substance in the preliminary contention raised by the appellant, the record should be sent back to the trial Court without delay so that it may proceed with the trial of the case. On 126 May 7 1953, the appellant alone with Vaish was tried by the Additional District and Sessions Judge at Kanpur. The charge under section 120 B was tried by the learned Judge with the aid of assessors, whereas the remaining charges were tried by him with the aid of the jury. Agreeing with the opinion of the assessors and the unanimous verdict of the jury, the learned Judge convicted the appellant under section 120 B and sentenced him to two years ' rigorous imprisonment. He also convicted him under section section 161 and sentenced him to two years Rigorous imprisonment and a fine of Rs, 25,000/ . in default to suffer further rigorous imprisonment for six months. For the offence under section 467 Indian Penal Code of which the appellant was convicted, the learned Judge sentenced him to four years ' rigorous imprisonment. Be was also convicted under r. 81 (4) read with r. 121 and cls. 4,5, 11 b (3) and 12 of the Iron and Steel Order of 1941 and sentenced to two years 'rigorous imprisonments. All the sentences thus imposed on the appellant were to run concurrently. Vaish who was also tried along with the appellant was similarly convicted and sentenced to different terms of imprisonment. The appellant and Vaish then appealed to the High Court against the said order of convictions and sentence. It was urged on their behalf before the High Court that the charge delivered by the Judge to the jury suffered from grave misdirections and non directions amounting to misdirections. his plea was accepted by the High Court and so, the High Court examined the evidence for itself. In the main, the High Court considered the ten instances adduced by the prosecution for showing that the appellant had accepted illegal gratification and had committed the other offenses charged, and came to the conclusion that the prosecution evidence in respect of eight instances could not be acted upon, whereas the said evidence in respect of two instances could be safely acted upon. These two instances 127 were deposed to by Lala Sheo Karan Das and other witnesses and by Sher Singh Arora and other witnesses. In the result, the High Court confirmed the appellant 's conviction under sections 161 and 467 and the sentences imposed by the trial Court in that behalf. His conviction under section 120 B Indian Penal Code, and under r. 81(4) read with r. 121 Defence of India Rules was set aside and he was acquitted of the said offenses. The High Court directed that the sentences imposed on the appellant under sections 161 and 467 should run concurrently. The appeal preferred by Vaish was allowed and the order of conviction and sentence passed against him by the trial Court in respect of all the charges was set aside. This order was passed on March 17th, 1958. The appellant then applied for and obtained a certificate from the High Court and it is with that certificate that he has come to this Court in appeal. At, this stage, it would be useful to indicate briefly the main findings recorded by the High Court against the appellant. As we have just indicated, there are only two instances out of ten on which the High Court has made a finding against the appellant. The first is the case of Lala Sheo Karan Das. According to the prosecution case, as a motive or reward for issuing written orders and expediting supply of iron by the stock holders ' Association Kanpur to Lala Sheo Karan Das, the appellant accepted from him Rs. 4,000/ on 31.3.1946, Rs. 2,000/ on 9.4.1946; Rs. 1,060/ on 11.4.1946 and Rs. 1,000/ on 12.5 1946 as illegal gratification. That is the basis of the charge under section 161. The prosecution case further is that in regard to the supply of iron to Lala Sheo Karan Das, certain documents were forged and it is alleged that the written orders issued in that behalf Exhibits P 341 and P 342 were ante dated and the licences issued in that behalf were similarly ante dated. In support of this case, oral evidence was given by 128 Lala Sheo Karan Das himself, his son Bhola Nath and Parshotam Das, his nephew who is a partner with him. This oral evidence was sought to be corroborated by relevant entries in kachhi rokar books. These entries indicated that the several amounts had been paid by the firm to the appellant. The High Court considered the oral evidence and held that the said evidence was corroborated by entries in the account books. The argument that dacca rokar books had not been produced did not appear to the High Court to minimise the value of the kachhi rokar books which were actually produced, and the contention that the books of Account kept by accomplices themselves could not, in law, corroborate their oral evidence, did not appeal to the High Court as sound. It held that even though Sheo Karan Das, his son and his nephew may be black marketeers, it did not necessarily follow that they were liars. Besides, the High Court took the view that there were certain pieces of circumstantial evidence which lent support to the oral testimony of the accomplices. The ante dating of the orders, and the supply of a large quantity of iron, were two of these circumstances. It is on these grounds that the High Court accepted the prosecution case against the appellant under section 161 Indian Penal Code. The High Court then examined the evidence in support of the charge under section 467 and it held that the manner in which the dates in the quota register had been tampered with supported the oral testimony of the witnesses that the applications made by Sheo Karan Das had been deliberately and fraudulently ante dated and orders passed on them and the licences issued pursuant to the said orders all were fraudulent documents which proved the charge under section 467 as well as under r. 47 (3) read with 47(2)(a). On these grounds, the appellant 's conviction under section 467 was also confirmed. As to the prosecution case in respect of the bribes offered by Sher Singh Arora, the High Court 129 was not satisfied with the evidence adduced in respect of the actual offer of money, but it held that the evidence adduced by the prosecution in respect of the offer and acceptance of certain valuable things was satisfactory. These valuable things were a three piece sofa sot, a centre piece, two stools and a revolving chair (Exts. 16 to 21). These were offered on behalf of Sher Singh Arora and accepted by the appellant in January, 1946. In dealing with this part of the prosecution case, the High Court considered the statements made by the appellant and ultimately concluded that the charge under section 161 had been proved in respect of the said articles. In regard to the charge under section 467, the High Court adopted the same reasons as it had done in dealing with the said charge in respect of Sheo Karan Das 's transactions and held that the said .charge had been proved. The licences which are alleged to have been ante dated are Exts. P 535 and P 536. The application which is alleged to have been ante dated is Ext. P 294, and the High Court thought that the relevant entries in the quota register showed that the dates had been tampered with. In the result, the charge under section 467 in respect of this transaction was held to be established. An alternative charge was also proved against the appellant under r. 47(3) read with r. 47(2) (c) Defence of India Rules. The first point which Mr. Chari has raised before us is that the Addl. District & Sessions Judge had no jurisdiction to try this case, because at the relevant time, the Criminal Law Amendment Act, 1952(46 of 1952) had come into operation and the case against the appellant could have been tried only by a Special Judge appointed under the said Act. This argument has been rejected by the High Court and Mr. Chari contends that the decision Of the High Court in erroneous in law. In order to deal with the merits of this point, it is necessary to 130 refer to some dates. The order of commitment was passed in the present proceedings on March 1, 1952. It appears that thereafter a list of defence witnesses was tiled by the appellant before the Commiting Magistrate on July 24, 1952. On July 28, 1952, the Criminal Law Amendment Act came into force. On August 14, 1952, Vaish filed a list of witnesses before the committing Magistrate and requested that one of the prosecution witnesses should be recalled for cross examination. On September 18, 1952, the District & Sessions Judge at Kanpur was appointed a Special Judge under the Act. On December 19, 1952, the case was taken up before the Special Judge and the question as to where the case should be tried was argued. The Special judge held that the question had been considered by the Madras High Court in the case of P. K. Swamy and it had been held that the Special Judge had no jurisdiction to hear the case because the order of commitment ' had been passed prior to the passing of the Criminal Law Amendment Act. Since the order of commitment in the present case had also been passed before July 28, 1952, the Special Judge held that the case against the appellant must be tried under the provisions of the Criminal Procedure Code and not under the provisions of the Criminal Law Amendment Act; and so, an order was passed that the trial should be held by the Additional District & Sessions Judge at Kanpur. After the case was thus transferred to the Add1. Sessions Judge at Kanpur, it was actually taken up before him on May 7, 1953, when the charge was read out to the accused persons and the jury was empanelled. It is in the light of these facts. that the question about the jurisdictions of the trial Judge has to be determined. Two provisions of the Criminal Law Amendment Act fall to be considered in this connections Section 7 provides that notwithstanding anything contained in the Code of Criminal Procedure, or in 131 any other law, the offenses specified in sub section (1) of section 6 shall be triable by a Special Judge only, Offenses under sections 161 and 165 Indian Penal Code are amongst the offenses specified by section 6(1). Section 7(2)(b) provides that when trying any case, a Special Judge may also try any offence other than an offence specified in section 6 with which the accused may, under the Code of Criminal Procedure be charged at the same time. Therefore, if the offence under section 161 falls under section 7(1) and has to be tried by a Special Judge, the other offenses charged would also have to be tried by the same Special Judge as a result of section 7(2)(b). It is clear that the provisions of a. 7 are prospective. This position is not disputed. But it would be noticed that section 7 does not provide for the transfer of pending cases to the special Judge and so, unless the appellant 's case falls under the provisions of section 10 which provides for transfer, it would be tried under the ordinary law in spite of the fact that the main offence charged against the appellant falls under section 6(1) of the Criminal Law Amendment Act. That takes us to section 10 which deals with the transfer of certain pending cases. This section provides that all cases triable by a special Judge under section 7 which immediately before the commencement of the Act, were pending before any Magistrate shall, on such commencement, be forwarded for trial to the special Judge having jurisdiction over such cases. It is thus clear that of the cases made triable by a special Judge by section 7, it is only such pending cases as are covered by s.10 that would be tried by the special Judge. In other words, it is only cases triable by a special Judge under section 7 which were pending before any Magistrate immediately before the commencement of this Act that would tie transferred to the special Judge and thereafter tried by him. So, the question to consider is whether the appellant 's case could be said to have been pending 132 before any Magistrate immediately before the commencement of the Act. This position also is not in dispute. The dispute centres round the question as to whether the appellant 's case can be said to have been pending before a magistrate at the relevant time, and this dispute has to be decided in the light of the provisions contained in section 219 of the Code of Criminal Procedure. This section occurs in Chapter 18 which deals with the enquiry into cases triable by the Court of Sessions or High Court. We have already seen that on March 1, 1952, an order of commitment had been passed in the present case and that means that the jurisdiction of the committing Court had been exercised by the said Court under section 213 of the Code. Mr Chari contends that though the order of commitment had been passed, that does not mean that the case had ceased to be pending before the committing Magistrate. It is not disputed that once an order of commitment is made, the committing Magistrate has no jurisdiction to deal with the said matter; he cannot either change the order or set it aside. So far as the order of commitment is concerned, the jurisdiction of the Magistrate has come to an end. The said order can be quashed only by the High Court and that too on a point of law. That is the effect of section 215 of the Code. It is, however, urged that section 216 confers jurisdiction on the committing magistrate to summon witnesses for defence as did not appear before the said Magistrate and to direct that they should appear before the Court to which the accused had been committed. Similarly, before the said Magistrate, bonds of complainants and witnesses can he executed as prescribed by section 217. Section 219 confers power on the committing Magistrate to summon and examine supplementary witnesses after the commitment and before the commencement of the trial, and to bind them over in manner here in before provided to appear and give evidence. It is on the 133 provisions of this section that the appellant 's case rests. The argument is that since the committing magistrate is given power to summon supplementary witnesses even after an order of commitment has been passed, that shows that the committing magistrate still hold jurisdiction over the case and in that sense, the case must be deemed to be pending before him. We are not impressed by this argument. The power to summon supplementary witnesses and take their evidence is merely a supplementary power for recording evidence and no more. This supplementary power does not postulate the continuance of jurisdiction in the committing magistrate to deal with the case. It is significant that this power can be exercised even by a Magistrate other than the committing magistrate, provided he is empowered by or under section 206 and clearly, the case covered by the commitment order passed by one magistrate cannot be said to be pending before another magistrate who may be empowered to summon supplementary witnesses. When section 10 of the Criminal law Amendment Act refer to cases pending before any magistrate, it obviously refers to cases pending before magistrates who can deal with them on the merits in accordance with law and this requirement is plainly not satisfied in regard to any case in which a commitment order had been passed by the committing magistrate. After the order of commitment is passed, the case cannot be said to be pending before the committing magistrate within the meaning Of section 10. Therefore, we are satisfied that the High Court was right in coming to the conclusion that section 10 did not apply to the present case and so, the Addl. Sessions Judge had jurisdiction to try the case in accordance with the provisions of the Code of Criminal Procedure. It is true that in dealing with this point, the High Court has pro ceeded on the consideration that the appellant 's trial had actually commenced befere the 134 Addl. Sessions Judge even prior to July 28, 1952. In fact, it is on that basis alone that the High Court has rejected the appellant 's contention as to absence of jurisdiction in the. trial Judge. We do not think that the reason given by the High Court in support of this conclusion is right, because the trial of the appellant could not be said to have commenced before May 7, 1953. However, it is unnecessary to pursue this point any further because we are inclined to take the view that the appellant 's case does not fall under section 10 of the Criminal Law Amendment Act and that is enough to reject the contention of the appellant on this point. The next argument raised is in regard to the validity of the sanction given by the Government of India to the prosecution of the appellant. This sanction Ext. P 550 purports to have been granted by the Governor General of India under section 197 of the Code for the institution of criminal proceedings against the appellant. It has been signed by Mr. section Boothalingam, Joint Secretary to the Government of India on January 31, 1949. The sanction sets out with meticulous care all the details of the prosecution case on which the prosecution rested their charges against the appellant and so, it would not be right to contend that the, sanction has been granted as a mere matter of formality. The several details set out in the sanction indicate that prima facie, the whole case had been considered before the sanction was accorded. Mr. Chari, however, attempted to argue that on the face of it, the sanction does not show that the Governor General granted the sanction after exercising his individual judgment. Section 197 of the code at the relevant time required that sanction for the prosecution of the appellant should have been given by the Governor General exercising his individual Judgment, and since, in terms ' , it does not say that the Governor General in exercise of his individual 135 judgment had accorded sanction, the requirement of section 197 is not satisfied. That is the substance of the contention. In support of this contention, reliance is sought to be placed on certain statements made by Mr. Boothalingam in his evidence. Mr. Boothalingam stated that sanction of the Governor General was conveyed by him as Joint Secretary to the Government of India. He also added that authorities of the Government of India competent to act in this behalf accorded the sanction and he conveyed it. His evidence also showed that the matter had been considered by the competent authorities and that he was one of those authorities. Mr. Chari argues that Mr. Boothalingam has not, expressly stated that the Governor General applied his individual mind to the problem and exercising his individual Judgment, came to the conclusion that the sanction should be accorded. This contention had not been raised at any stage before and the point had not been put to Mr. Boothalingam who gave evidence to prove the sanction. If the point had been expressly put to Mr. Boothalingam be would have either given evidence himself on that point or would have adduced other evidence to show that the Governor General had exercised his indi vidual judgment in dealing with the matter. Therefore, we do not think that this plea can be allowed to be raised for the first time in this Court. The next ground of attach against the validity of the sanction is based on the assumption that at the time when the sanctions was (riven, the appellant had ceased to be in the employment of the Government of India and had reverted to the Assam Government. .If it is established that at the relevant time, the ,appellant was a person employed in connection with the affairs of the Assam State, then of course, it is the Assam Government that would be competent to give the sanction. The High Court has found that at the relevant time, the appellant continued to be 136 in the employment of the affairs of the Federation and had not reverted to the Assam Government ; and in our opinion, this finding of the High Court is right. We have already referred to the course of events that led to the granting: of the leave to the appellant by the Government of India; to the extension of the leave by the said Government and to his subsequent suspension. The appellant 's argument is that after he went on leave, he moved the Assam Government for extension of his leave and was, in fact, asked by the Assam Government to appear before a medical board appointed by it. We do not think that these facts are enough to prove that the appellant had reverted to the service of the Assam Government. In fact., it is clear that the Government of India had intimated to the Assam Government that the appellant continued to be under its employment and that the Assam Government had expressly told the Government of India that it had no desire that the appellant should revert to its service until the 'criminal proceedings instituted against him were over. The Assam Government also pointed out that the appellant himself did not wish to rejoin in his post of Superintendent of the Assam Government 's Press but had only asked for Leave Preparatory to Retirement following medical advice. It is thus clear that though the Government of India had originally thought of replacing the appellant 's services with the Assam Government at the end of the leave which was proposed to be granted to him, subsequent events which led to an investigation against the appellant and his suspension caused a change in the attitude of the Government of India and it decided to continue him in its employment in order that he should face a trial on the charges which were then the subject matter of investigation. There is no order reverting him to the Assam Government passed by the Govt. of India and there is no order passed by the Assam Government at all on this subject. Therefore 137 there can be no doubt that at the relevant time, the appellant continued to be employed in the affairs of the Federation. It was then sought to be argued that the effect of SR 215 was that the reversion of the appellant to the Assam Government should be deemed to have taken effect from the date when the leave was granted to him by the Government of India. In our opinion, there is no substance in this argument. The portion on which the appellant relies is merely an administrative direction under the Rule and it cannot possibly over ride the specific orders issued by the Government of India in respect of the appellant 's leave and reversion. Besides, even the requirements of the said Rule are not satisfied in the present case. Therefore, the conclusion is inescapable that the appellant was employed in the affairs of the Federation at the time when the sanction was accorded. That takes us to the question as to whether the Government of India was competent to grant the sanction even if the appellant was at the relevant time a person employed in connection with the affairs of the Federation. Mr. Chari contends that in the case of the appellant whose services had been loaned by the Assam Government to the Government of India, it could not be said that he was a parson permanently employed in connection with the affairs of the Federation and so, cl. (a) of section 197 (1) would not apply to him at all. He was a person permanently employed in connection with the affairs of a State and that took the case under cl. (b) which means that it is the Governor of Assam exercising his individual judgment who could have a(, corded valid sanction to the appellant 's prosecution. We are not impressed by this argument. It is clear that the first part of section 197 (1) provides a special protection, inter alia, to public servants who are not removable from their offices save by or with the 138 sanction of the State Government or the Central Government where they are charged with having committed offenses while acting or purporting to act in the discharge of their official duties; and the form which this protection has taken is that before a criminal court can take cognizance of any offence alleged to have been committed by such public servants, a sanction should have been accorded to the said prosecution by the appropriate authorities. In other words, the appropriate authorities must be satisfied that there is a prima facie, case for starting the prosecution and this prima facie satisfaction has been interposed as a safeguard before the actual prosecution commences. The object of section 197(1) clearly is to save public servants from frivolous prosecution, Vide, Afzelur Rahman vs The King Emperor(1). That being the object of the section, it is clear that if persons happened to be employed in connection with the affair 's of the Federation, it was the Governer General who gave sanction and if persons happened to be employed in connection with the affairs of the State, it was the Governor. What is relevant for the purpose of deciding as to who should give the sanction, is to ask the question where is the public servant employed at the relevant time ? If he is employed in the affairs of the Federation, it must be the Governor General in spite of the fact that such employment may be temporary and may be the result of the fact that the services of the public servant have been loaned by the State Government to the Government of India. Therefore, having regard to the fact that at the relevant time the appellant was employed in connection with the affairs of the Federation, it was the Governor General alone who was competent to accord sanction. Therefore, our conclusion is that the sanction granted by the Governor General for the prosecution of the appellant is valid. That still leaves the validity of the sanction to be tested in the light of the provisions of (1) ,12. 139 a. (6) of the prevention of the Corruption Act, 1947. At the relevant time, section 6 read thus: "No court shall take cognizance of an offence punishable under section 161 or section 165 of the Indian Penal Code (XIV of 1860) or under sub section (2) of section 5 of this Act, alleged to have been committed by a public servant, except with the previous sanction: (a) In the case of a person who is employed in connection with the affairs of the Federation and is not removable from his office save by or with the sanction of the Central Government or some higher authority, Central Government. (b) In the case of a person who is employed in connection with the affairs of a province and is not. removable from his office save by or with the sanction of the Provincial Government or some higher authority, Provincial Government: (c) in the case of any other person, of the authority competent to remove him from his service". It would be noticed that the scheme of this section is different from that of section 197 of the Code of Criminal Procedure. The requirement of the first part of section 197 (1) which constitutes a sort of preamble to the provisions of section 197(1)(a) & (b) respectively, has been introduced by s.6 severalty in cls. (a) and (b). In other words, under els. (a) and (b) of section 197(1) the authority competent to grant the sanction is determined only by reference to one test and that is the test provided by ,,the affairs in connection with which the public servant is employed"; if the said affairs are the affairs of the Federation, the Governor General grants the sanction ; if the said affairs are the affairs of a Province, the 140 Governor grants the sanction. That is the position under section 197(1) as it then stood. The position under section 6 of the Prevention of Corruption Act is substantially different. Clauses (a) & (b) of this section deal with persons permanently employed in connection with the affairs of the Federation or in connection with the affairs of the Province respectively, and in regard to them, the appropriates authorities are the Central Government and the Provincial Government. The case of a public servant whose services are loaned by one Government to the other, does not fall either under cl. (a) or under cl.(b), but it falls under el. Having regard to the scheme of the three clauses of section 6, it is difficult to construe the word "employed in cls. (a) & (b) as meaning "employed for the time being". The said Words, in the context, must mean ,,,permanently employed". It is not disputed that if the services of a public servant permanently employed by a Provincial Government are loaned to the Central Govt., the authority to remove such public servant from office would not be the borrowing Government but the loaning Government which is the Provincial Government, and so, there can be no doubt that the employment referred to in cls. (a) & (b) must mean the employment of a permanent character and would not include the ad hoc or temporary employment of an officer whose services have been loaned by one Government to the other. Therefore, the appellant 's case for the purpose of sanction under section 6 will fall under el. (c) and that inevitably means that it is. only the Provincial Government of Assam which could have given a valid sanction under section 6. At the relevant time, section 6 had come into operation, and section 6 expressly bars the cognizance of offenses under s.161 unless a valid sanction had been obtained as required by it. Therefore, in the absence of a valid sanction, the charge against the appellant under a. 161 and section 163 could not have been tried and that renders the 141 proceedings against the appellant in respect of those two charges without jurisdiction. The result is that the contention of the appellant that the sanction required for his prosecution under section 161 and section 165 is invalid, succeeds and his trail in respect of those two offenses must, therefore, be held to be invalid and without jurisdiction. That being so, it is unnecessary to consider whether the finding of the High Court in respect of the charge under section 161 is justified or not. So, we do not propose to consider the evidence led by the prosecution in respect of the said charge in relation to the two cases of Lala Shoo Karan Das and Sher Singh Arora. The charge under section 467 or the alternative charge under Defence of India Rules still remains to be considered, because the said offenses are outside the scope of section 6 of the Prevention of Corruption Act and the sanction accorded by the Governor General in respect of the appellant 's prosecution for the said offenses is valid under section 197 of the Code of Criminal Procedure. What, then, are the material facts on which the conclusion of the High Court is based? The first point on which stress has been laid both by Mr. Chari and Mr. Sarjoo Prasad relates to the background of the case. Mr. Chari contends that the prosecution of the appellant is, in substance, the result of the attempts successfully made by the back marketeers in Kanpur to involve the appellant in false charges and in support of his plea, Mr. Chari has very strongly relied on the evidence of Mr. Kanhaiya Singh. This witness was, at the relevant time, an Inspecting Assistant Commissioner of Income tax at Kanpur and his evidence seems to show that unlike his predecessor Mr. Talwar, the appellant gave whole hearted co operation to the witness in discovering the illegal dealings of black marketeers in Kanpur in 142 iron. According to the witness, the black marketeers came to know about the cooperation between him and the appellant and that disturbed them very rudely. Some lists were prepared by the appellant giving the witness detailed infor mation about the activities of the black marketeers and the witness suggested that in order to destroy the papers thus supplied to him by the appellant, a burgulary was arranged in his house in May or June, 1946. A similar burgulary took place in the appellant 's house. There was also a fire in the appellant 's house. The witness was asked whether any of the persons who have given evidence against the appellant in the present case, were included in the list supplied by the appellant to him, and the witness refused to answer the said question and. claimed protection under section 54 of the Income Tax Act. Mr Chari 's argument is that the activities of the appellant in cooperation with Mr. Kanhaiya Singh frightened the black marketeers and so, they organised the present plot to involve the appellant in a false case. In that connection, Mr. Chari also relies on the fact that out of the ten instances, the story deposed to in respect of eight has been rejected by the High Court. On the other hand, Mr. Sarjoo Prasad has argued that as soon as the appellant took charge from Mr. Talwar, he evolved a very clever scheme of establishing personal contacts with the black marketeers; dispensed with the enquiry which used to be held prior to the granting of licences to them and. thus introduced a practice of direct dealings with the black marketeers which facilitated the commission of the offenses charged against him. He has also referred us to the evidence given by Mr. Sen which tends to show that the appellant was frightened by the prospect of investigation and so, suddenly left Kanpur under the pretext of illness. In other words, Mr. Sarjoo Prasad 's argument is that the appellant deliberately adopted a very clever 143 modus operandi in discharging his duties as a public servant and has, 'in fact, committed the several offenses charged against him. We do not think that the ultimate decision of the narrow point with which we are concerned in the present_ appeal can be determined either on the basis that the appellant is more sinned against than a sinner or that he is a cold blooded offender. Ultimately, we will have to examine the evidence specifically connected with the commission of the offence and decide whether that evidence can legitimately sustain the charge under section 467. Let us take the case as disclosed by the evidence of Sheo Karan Das in respect of the charge under section 467. According to Sheo Karan Das, the two applications Exts. 35 and 36 were given by him in the office of the appellant on the 29th or 30th March, 1946, but the appellant asked the witness to get other applications in which the date should be prior to 23rd of March. Accordingly, the witness put the date 22nd March on his applications. On the 29th or 30th March when the witness met the appellant, he asked for 130 tons and the appellant told him that he could give him more than that, provided, of course, the appellant got his profit. Accordingly, after these applications were antedated, the appellant passed orders and licences were issued. Thus, it would be seen that the prosecution case is that the applications which were presented by Sheo Karan Das on the 29th or 30th of March, were deliberately ante dated in order that the orders subsequently passed by the appellant and the licences issued thereunder should also appear to have been issued prior to the 23rd of March and that, in substance, is the essence of the charge under section 467. When this case was put to the appellant, he made a somewhat elaborate statement which it is necessary to consider. According to this statement, 144 the appellant left Kanpur on March 23, 1946, for a meeting with Mr. Spooner who was the Iron Steel Controller at Calcutta. Mr. Spooner told him in confidence that there would be no more need to issue licences after March 31, on account of decontrol. He also expressly desired that no further licences need be issued by any Regional Dy. Iron & Steel Controller after March 26, 1946. The appellant returned to Kanpur on March 28, and attended office on ,he 29th. He then found that the office had placed on his table a number of licences for which he had already issued orders before he left Kanpur on the 23rd. Some new applications had also come thereafter and these included applications from Government bodies and other public institutions. These were also placed on his table. The appellant urged that statutorily he had the power to issue licences until March 31, even so, in order to comply with the desire expressed by Mr. Spooner, he ordered that all licences should be issued as on March 23. The appellant emphasised that even if he had dated the licences and his own orders as on the 30th or 31st March, that would have introduced no invalidity in the orders or licences respectively, and so, he contended that even though in form, the orders and the licences can be said to have been ante dated, the ante dating did not introduce, any criminal element at all. It appears that after his return to Kanpur on the 28th, a large number of licences were issued in this way. This statement of the appellant thus shows that even on applications admittedly received after the 23rd, licences were issued as on the 23rd and orders had been passed by the appellant in support of the issue of such licences. This antedating of the licences is a circumstance on which the prosecution strongly relies in support of the charge under section 467. It is, however, significant that besides the testimony of the accomplices, there is no other 145 evidence on the record to show that the applications given by Sheo Karan Das had been brought to the office of the appellant for the first time on the 29th or 30th of March as deposed to by him. No register had been produced from the office showing the date of the receipt of the said applications. It is true that in the quota register, dates had been tampered with, but there is no evidence to show who tampered with those dates and so, the fact that dates had been tampered with will not afford any legal evidence in support of the case that the applications presented by Sheo Karan Das had in fact, been presented for the first time on the 29th of March and had not been filed on the 22nd of March as pleaded by the appellant. The ante dating of the applications is a very important fact and of this fact there is no other evidence at all. Therefore, in our opinion, the crucial fact on which the charge under section 467 is based is deposed to only by accomplice witnesses and their statements are Dot corroborated by any other evidence on the record. The admission made by the appellant does not necessarily show that the applications had been ante dated. Indeed, it is very curious that the appellant should have passed necessary orders and should have directed the issue of licences as on the 23rd of March even in regard to the applications received by him subsequent to the 23rd March and this has been done in respect of applications received from Government bodies and public institutions. This fact lends some support to the appellant 's theory that he did not want to appear to have contravened the desire expressed by Mr. Spooner that no license should be issued subsequent to the 26th March. There is no doubt that the appellant was competent to issue licences until the 31st of March and so, it is not as if it was essential for him to ante date his orders or to ante date the licences issued in accordance with them. Then as to the orders passed by the appellant on the applications presented by 146 Sheo Karan Das, there is no date put by the appellant below his signature, though the date 22nd March appears at the top of the document. But it may be assumed that the order was passed on the 29th. That, however, does not show that the applications were made on the 29th and without proving by satisfactory evidence that the applications were made on the 29th, the prosecution cannot establish its charge against the appellant under section 467. In our opinion, the High Court appears to have misjudged the effect of the admissions alleged to have been made by the appellant when it came to the conclusion that the said admissions corroborated the accomplice 's case that the applications had been presented by him for the first time on the 29th March. The fact that there is no evidence offered by any of the prosecution witnesses examined from the appellant 's office to show the dates when the applications were received, has not been considered by the High Court at all. Therefore, the finding of the High Court on the essential part of the prosecution story in respect of the charge under section 467 really rests on the evidence of the accomplice uncorroborated by any other evidence. That being so, we must hold that the High Court erred in law in making a finding against the appellant in respect of the charge under section 467 as well as the alternative charge under the relevant Defence of India Rules. What we have said about this charge in respect of the licences issued to Sheo Karan Das applies with the same force to the said charge in respect of the licences issued to Sher Singh Arora. In respect of those licences also, there is no evidence to show that the applications made by Sher Singh Arora had been ante dated, and so, the charge in respect of the said licences also cannot be held to have been established. The result is, the finding Of the High Court in respect of the charge against the appellant under section 467 or the alternative charge under the relevant Defence of India Rules must be reversed, his 147 conviction for the, said offenses set aside and be should be ordered to be acquitted and discharged in respect of those offenses. That raises the question as to whether we should order a retrial of the appellant for the offence under section 161. Mr. Sarjoo Prasad has argued that the interests of justice require that the appellant should be asked to face a new trial in respect of the charge under a. 161, Indian Penal Code if and after a valid sanction is obtained for his prosecution for the same. We are not inclined to accept this argument. Two facts have weighed in our minds in coming to the conclusion that a retrial need not be ordered in this case. The first consideration is that the accused has had to face a long and protracted criminal trial and the sword has been hanging over his head for over 14 years. The accused was suspended in 1947 and since then these proceedings have gone on all the time, The second factor which has weighed in our minds is that though the prosecution began with a charge of a comprehensive conspiracy supported by several instances of bribery, on the finding of the High Court it is reduced to a case of bribery offered by two persons; and then again, the substantial evidence is the evidence of accomplices supported by what the High Court thought to be corroborating circumstances. It is true that offenses of this kind should not be allowed to go unpunished, but having regard to all the facts to which our attention has been drawn in the present case, we are not inclined to take the view that the ends of justice require that the accused should be ordered to face a fresh trial. The result is that the conviction of the appellant under section 161 is set aside on the ground that his trial for the said offence was without jurisdiction since his prosecution in that behalf was commenced without a valid sanction as required by s.6 of the prevention of Corruption Act. Appeal allowed.

The appellant was in the permanent service of the Assam Government but his services were lent to the Central Government. At the relevant time, i e , December 1945 to September 1946, he was posted at Kanpur as Deputy Iron & Steel Controller. In connection with the granting of permits to certain persons charges under sections 120B, 161, 165 and 467 Indian Penal Code, and under r. 473(3) read with r.472, Defence of India Rules were leveled ' against him. Sanction for his prosecution was granted by the Central Government on January 31, 1919, and a charge sheet was submitted against him. On March 1, 1952, the appellant was committed to the Court of Sessions for trial. The trial commenced on May, 7, 1953, and the Sessions judge convicted the appellant of all the charges. On appeal the High Court upheld the conviction under sections 161 and 467 Indian Penal Code and set aside the conviction on the other charges. The appellant contended (i) that the trial by the Sessions judge was illegal as after the coming into force of the Criminal Law Amendment Act, 1952, on July 28, 1952, he could only be tried by a Special judge, and (ii) that the sanction granted by the Central Government was invalid and of no avail as sanction for the prosecution of the appellant could only be granted by the Assam Government in whose permanent employment the appellant was. Held, that the Sessions Judge had jurisdiction to hold the trial and it was not required that the appellant should have been tried by a special judge. Though s.7 of the Criminal Law Amendment required all offenses under sections 1 61 and 165 Indian Penal Code to be tried by a Special judge, the section was only prospective and did not provide for transfer of all pending cases. Under s.10 of the Act only such cases triable by a Special Judge under s.7as were ac tually pending before any Magistrate immediately before 122 the commencement of the Act could be transferred to the Special judge. The case against the appellant having already been committed to the Sessions was no longer pending before the Magistrate. The mere fact that the Magistrate still had power, under s.216 of the Code of Criminal, Procedure to summon witnesses for the defence and bind them to appear before the Court of Sessions, did not imply that his jurisdiction to deal with the merits of the case continued. Held, further that though the sanction granted by the Central Government was a good sanction under section 197 of the Code of Criminal Procedure it was not a valid sanction under s.6 of the Prevention of Corruption Act. At the time when the sanction was granted the appellant was in the permanent employment of the Assam Government but he was employed in the affairs of, the Federation. Under s.197, in cases of persons employed in connection with the affairs of the Federation the Governor General was the authority to grant the sanction and in cases of persons employed in connection with the affairs of the States it was the Governor. Under s.6 of the Corruption Act the position was different. Clauses (a) and (b) of the section dealt with persons permanently employed in connection with the affairs of the Federation or of the Provinces and in regard to them, the appropriate authorities were the Central Government and the Provincial Government. The word "employed" in cls.(a) and (b) referred to employment of a permanent character. The case of a public servant whose services were loaned by one Government to another fell under cl.(c) under which sanction could be ranted by the authority competent to remove him from his service. The authority competent to remove the appellant from his service was the Assam Government and that Government alone could have granted a valid sanction for the prosecution of the appellant. Accordingly the trial of the appellant for offenses under sections 161 and 165 was without jurisdiction. Held, further that the convinction of the appellant for the offence under s.467 could not stand as it was based entirely upon the uncorroborated testimony of accomplices.

Appeal No. 242 of 1960. Appeal from the judgment and order dated September 11, 1957, of the Andhra Pradesh High Court in Writ Petition No. 201 of 1952. R. Can apathy Iyer, T. V. R. Tatachari, D. Venkatappaya Sastri and P. D. Menon, for the appellants. K. Bhimasankaram and T. Satyanarana, for the respondent. , March 30. The Judgment of the Court was delivered by WANCHOO, J. This appeal on a certificate granted by the Andhra Pradesh High Court raises a question of the constitutionality of the Madras Estates Land (Reduction of Rent) Act, No. XXX of 1947, as amended, (hereinafter referred to as the Act) and a notification issued thereunder. The brief facts necessary for present purposes are these. The respondent was the sole inamdar of village Chinnavenkatapuram in the Parlakimidi zamindari in the district of Srikakulam. The legislature the composite State of Madras passed the Act, which came into force from January 7, 1948, to provide for the reduction of rents payable by ryots in estates governed by the Madras Estates Land Act, No. 1 of 1908, approximately to the level of the assessments levied on lands in ryotwari areas in the neighborhood and for the collection of such rents exclusively by the State Government. The Act applied to all estates as defined in section 3 (2) of the Madras Estates Land Act. Section 2 provided for the appointment of a special officer for any estate or estates for the purpose of recommending fair and equitable rates of rent for the ryoti lands in such estate or estates and laid down the procedure to be followed by the Special officer for 157 such purpose, and gave power to the special officer to determine after necessary enquiries the extent if any to which the rates of rent payable for each class of ryoti lands should in his opinion be reduced and to fix the rates of rent payable for each class of ryots after such reductions. Under a. 3, the special officer had to submit a report after completion of his inquiry to the State Government on the two points mentioned above and after considering the recommendations of the special officer and the remarks of the Board of Revenue thereon, the State government was empowered by order published in the gazette to fix the rates of rent in respect of each class of ryoti land in each village in the estate, and the order so passed by the State Government was to take effect from the commencement of the Fasli year 1357. Section 3 (4) then provided for the recovery of rents so fixed by the State Government and the amount so recovered in respect of each year, after deducting therefrom the cost of such recovery as may be determined according to the Rules to be framed and also after deducting the peshkash, cesses and other moneys due from the landholder to the State Government, was to be paid to the landholder. Section 3 (7) laid down that the landholder shall not be entitled to collect rents thereafter. Sections 5 and 6 made special provisions with regard to religious, educational and charitable institutions. Section 7 provided for the framing of rules and sections 4, 8 and 9 made incidental provisions which are however not material for our purposes. In pursuance of the provisions of the Act a notifications was issued by the State Government with respect to the estate of the respondent fixing the rates of rent for various classes of ryoti lands in the estate. In the case of wet and dry lands the rate was reduced to half of the then existing rates and in the case of dry land (when agraharam well water 158 was used) the rate was reduced to one sixth of the existing rate. Thereupon the respondent filed a writ petition on March 21. 1952, challenging the above notification. The first challenge was on the ground that the estate of the respondent was not an estate within the meaning of the Madras Estates. Land Act and therefore the Act was not applicable to it. Secondly, it was contended that the reduction in the 'rents made by the notification was so drastic as to result virtually in depriving the respondent of his right to hold and enjoy his property, as the out goings were far in excess of the income after the reduction in rents. Consequently, the notification amounted to an unreasonable restriction on the right of the respondent to hold property under article 19 (1) (f) of the constitution. The petition was opposed on behalf of the State and it was contended that it was incorrect to say that the outgoings were more than the income after the reduction of rents made by the impugned notification. It was pointed out that after meeting the cess, the quit rent and ten per centum for collection charges, the respondent would have a net income of Rs. 603/ and the reduction in the circumstances could not be said to be so drastic as to virtually deprive the respondent of his right to hold property under article 19 (1) (6). When the matter came to be argued before the High Court, three points were raised by the respondent, namely, (i) that the village in dispute was not an estate, (ii) that even if it was an estate the notification under the Act offended article (19) (1) (f) of the Constitution because of the drastic nature of the reduction, and (iii) that the Act itself was ultra vires for the reason that it was contrary to the terms of article 31 of the Constitution and section 299 of the Government of India Act, 1935. The third of these contentions, though it was not raised in the petition by the respondent, was eventually referred to a Full 159 Bench and the question put to the Full Bench was in these terms: "Whether the decision in Rajah of Bobbili V. State of Madras (1) insofar as that Madras Act XXX of 1947 does not offend against section 299 of the Government of India Act, 1935, is good law?" It may be mentioned here that the Act was challenged soon after it was passed by the Rajah of Bobbili on various grounds one of which was that the Act was bad as it contravened section 299 (2) of the Government of India Act. This challenge to the Act was repelled by the Madras High Court in the case of Rajah of Bobbili(1) and it was held that mere reduction of rent was not acquisition of property within the meaning of section 299 (2) of the Government of India Act and the effect of the Act was held to be that the landholder continued to be the owner of the estate as before, his title being left untouched. It was further pointed out that it was the tenant who was entitled 'to possession, the right of the landholder being only to recover rent and that right again was left unaffected by the legislation, the only change being that the collection of rent was to be made not by the landholder but by the Government. Further though the learned Judges in Rajah of Bobbili 's case (1) were apparently of opinion that the acquisition contemplated by section 299 (2) of the Government of India Act was acquisition of title, they went on to say that even assuming that section 299 (2) of the Government of India Act, covered cases of posses sion, there was no such taking of possession in the case before them tinder the Act as would attract that provision. The reference to the Full Bench in the High Court was due to the challenge to the narrow view of the word "acquisition" which was said to have been taken in Rajah of Bobbili '8 case (1) in view of (1) 160 certain later decisions of this Court. Eventually, however, the Full Bench held that even if a wider interpretation was given to the word " 'acquisition ' as used in section 299(2) of the Government of India Act, there was no deprivation of the property of the landholder by the Act within the meaning of s.299(2) and therefore the decision in the Rajah of Bobbili 's case (1) was still good law. The Full Bench also held that the provisions of the Act only regulated the relationship of landholder and tenant and as there was no acquisition by the Government even in the wider meaning to be given to the word "acquisition" in section 299(2) of the Government of India Act, the Act was not hit by article 19(1)(f) and was a reasonable restriction on the right to hold property and in the interest of the general public. The Full Bench further held that, though prima facie .the reduction of rents to the ryotwari level could not be said to be unreasonable, the view expressed in the Rajah of Bobblli 's case (1) that if in a particular case the result of the reduction of rates of rent had the effect of total or substantial deprivation of the landholder of his net income it would offend article 19(1)(f) of the Constitution. After this opinion of the Full Bench, the matter was again placed before a Division Bench, for final decision. At that stage it seems that the point that the village in dispute was not an estate was given up and the only point urged was that the reduction was so drastic as to amount to an unrea sonable restriction on the fundamental right to hold property under article 19(1)(f). The learned Advocate General placed before the Bench the effect of the reduction based on the notification of June 27,1950. It was found that prior to the reduction the net income of the respondent was Rs. 3,875/ , and after the reduction his net income was reduced to Rs. 457/13/8. It was urged by '. the learned Advocate General that the respondent was getting the rent at the highest rate prevalent in the ryotwari (1) 161 areas of the district and that it could not be said that the reduction of rates of rent to the level of the highest ryotwari rate was an unreasonable restriction on the right of the respondent to hold property. The Bench, however, observed that though ordinarily the reduction of rates of rent of the ryotwari level might be reasonable, there might be circumstances in a particular case to hold that the. reduction was so drastic that it would be an unreasonable restriction. It was observed that the State might reduce the rent to such a level after deducting the legal charges and the cost of collection fixed on an arbitrary basic that there might be nothing left to the landholder. In such a case in the name of regulation of rents and collection thereof the State took away the grain and gave the husk to the landholder. The Bench then added that though it was easy to state the principle it was difficult to apply it to the facts of each case. It then :went on to consider the circumstances under which it could be held that reduction was so drastic that the landholder was substantially deprived of his income., and was of opinion that having regard to the object of the Act, if the income of the landholder after reduction of rents did not fall below 25 per centum of his previous income it could be held that the reduction was not an unreasonable restriction on the right to hold property enshrined in article 19 (1) (f). As in this case, however, the income of the respondent fell far below 25 per centum of the income which be was getting before the reduction, the Bench held that the notification was bad. Thereupon the State Government asked for a certificate to appeal to this Court, which was granted; and that is how the matter has come up before us. So far as the constitutionality of the Act is concerned, there was no serious challenge to it by the respondent. If one refers to the main provisions of the Act relating to reduction of rents 162 which we have already set out above, it will appear that the object of the Act was to put a check on rack renting in estate as defined in the Madras Estates Land Act. As such agricultural tenants formed a considerable group of cultivators in the State, it was thought necessary to ameliorate their condition. The Act was therefore enacted under the powers conferred on the provincial legislature under item 21, of List II of Schedule VII to the Government of India Act dealing with land. It provided for reduction of rent to the level at which the rents prevailed in the neighbouring area where there was ryotwari settlement. In these circumstances it cannot possibly be said that the reduction of the prevailing rents to the ryotwari level was an unreasonable restriction on the right of the landholder of an estate to hold property under article 19 (1) (f). We must therefore hold that the Act is constitutional and lays down reasonable restrictions on the right of the landholder to hold his estate. The attack based on reading the term ',acquisition" in s.299 of the Government of India Act, 1935 in the wide sense of any interference with property even when the title thereto does not pass to the State, which was the point debated before the Full Bench is no longer a live issue since the matter is concluded against the respondent by the decision of this Court in Guru Dutt Sharma vs State of Bihar (1). This brings us to the main point that has been argued before us by counsel for the parties. It is urged on behalf of the appellant that the High Court was wrong in holding that where the reduction is such that the previous net income is reduced below 25 per centum there would be an unreasonable restriction on the right to hold property, merely because of this circumstances It is said that the fixation of this percentage at 25 per centum is more (1) 163 or less arbitrary. In any case it means that where a landholder had been successful enough previously to practice rack renting as an art and to increase the rents of his tenants unconscionably, he would get protection because in such a case it was likely that the reduction would be drastic and may even result in the reduced net income being less than 25 per centum of the previous net income. On the other hand in the case of a landholder who was a humane person and did not increase his rents unconscionably, the reduction of 'rents on the basis of the same rate which might be used in the case of the former landholder who was a rack renter may not be hit because in his case the reduction may not be below 25 per centum. So it is urged that if the reasonableness is to depend upon by how much the previous net income is reduced after the reduction, it will always work in favour of a landholder who was a rack renter even though the basis of reduction may be on the same rates in the case of a rack renting landholder and in the case of a humane landholder. Therefore, it is urged that if the reduction is reasonable in the case of a humane landholder because it is brought into line with the prevailing rates of rent in the neighbouring areas under the ryotwari settlement, there is no reason why such reduction should not continue to be reasonable in the case of the other landholder. The fact that in one case the reduction may not be below 25 per centum while in the other case it may go below 25 per centum will make no difference to the reasonab leness of the reduction, for in either case the basis of the reduction is the same. We are of opinion that there is force in this argument and it must be accepted. What we have to see is whether the Act when it provides for reduction of rent proceeds on a reasonable basis i.e. whether the reduction of rent to the level of the prevailing rent for the same class of land in the neighbouring areas where ryotwari settlement prevails is reasonable. This in our 164 opinion is a reasonable basis on which the rent in estates covered by the Madras Estates Land Act can be reduced. Once this basis is accepted 'as reasonable, we fail to see how the ratio between what the landholder was getting before the reduction and what he gets after the ' redaction will ' make what is per se reasonable into an unreasonable restriction. Theoretically. it may be possible to say that the reduction may be so much that nothing may be left to the landholder. This is what the respondent tried to make out in his writ petition, for his case therein was that the rents were so far reduced in his case that instead of getting an income of Rs. 3,875/ he would be getting no income at all and would be actually suffering a net loss of Rs. 655/ by his holding the estate after reduction of rents. ' This of course has been found by the High Court to be incorrect and in actual fact the landholder is left with a net income of Rs. 457/ and odd after the reduction in rent. Therefore. except for the theoretical possibility where the landholder may be left with nothing on reduction of rents, it cannot be said from the mere fact that in some cases the ratio of net income falls after reduction of rent as compared to the net income before reduction below 25 per centum that the restrictions imposed by the Act are unreasonable. , Actually 'we feel that there cannot possible be any case where after the reduction there will be nothing left to the landholder. We cannot therefore agree with the High Court that simply because in a particular case the net income after reduction falls below 25 per centum of the net income before reduction the notification which results in such a position, is an unreasonable restriction on the right of the land holder to hold his estate. As we have said already, the ratio by which the net income will fall after reduction will depend upon whether the landholder whose rents are being reduced was a rack renter or humane person; in the case of a rack renter the 165 fall may be heavier while in the case of a humane person the fall may be less. But if the basis on which the, reduction is made is the same in both cases and is reasonable, we see no reason for holding that a notification which may in a given case result in a fall of the net income which is even below 25 per centum of the previous net income would necessarily be bad as an unreasonable restriction on the right of the landholder to hold his estate. It is important in this connection to remember that the rent allowed to the respondent compares favorably with the highest rent payable by the ryotwari tenants in the locality. Therefore, the basis on which rents are being reduced under the Act being good and reasonable the result of such reduction would not make the,notification in a particular case bad except where that theoretical case is reached where there is no income left to the landholder after reduction, which in our opinion is impossible. We therefore allow the appeal and setting aside the order of the High Court dismiss the writ petition with costs throughout. Appeal allowed.

The Respondent, the sole inamdar of village Chinnaven katapuram in the Parlakimidi Zamindari in the District of srikakulam filed a Writ Petition before the High Court chal lenging lnter alia the notification issued under section 3 (4) of the Madras Estates Land (Reduction of Rent) Act by which the rents in respect of ryoti lands included in his Estate were reduced. He also challenged the provisions of the Act. The High Court accepted the challenge to the notification on the ground that the net income from rents was reduced to less than 25% of the original income and that the reduction was so substantial as to amount to an unreasonable restriction on the respondent 's right to hold property under article 19 (1) (f ) of the Constitution. On appeal by a certificate. Held, that the provisions of the Act were valid as they laid down reasonable restrictions in the interest of ameliorating the conditions of tenants of ryoti land in 'Estates ' who were at a disadvantage compared to tenants of ryotwari lands. Held, further, that it is only in a theoretical case where a land holder would be virtually ' deprived of his income by the reduction of rents that it can be said that the reduction was unreasonable. By the reduction the income of the Respondent was brought on a par with that of the highest prevailing rents in ryotwari lands and so it cannot be said that the reduction of rents made by the notification was violative of the land holders ' rights under article 19 (f ). The method of comparing the rents prior to reduction with the rents after reduction for the purpose of deciding the unreasonableness of the restriction was not sound as not humane landholders but those who were charging unconscionable rents would benefit thereby.

Appeal Nos. 252 and 253 of 1958. Appeals by Certificate and special leave from the judgment and order dated August 5, 1955, of the former Andhra High Court in Writ Appeal No. 13 of 1955. AND VICE VERSA D. Narsaraju, Advocate General for the State of Andhra Pradesh, D. Parsanna Kumari, P. V. R. Tatachari and P. D. Menon., for the, appellant (In C. A. No. 252 of 58) and Respondent No, 1 (In C. A. NQ 253 of 58). 175 P. Ram Reddy, for the the appellants (In C. A. No. 253 of 58) and Respondent No. 1 to 3 (In C. A. No. 252 of 58). A. V. Vishwanatha Sastri and K. R. Choudhri, for the respondent No. 2 (In C. A. No. 253 of 58). April 2. WANCHOO, J. These are two connected appeals arising out of the same judgment of the, Andhra Pradesh High Court. The main appeal No. 252 is by the State of Andhra Pradesh while the other appeal No. 253 is by Duvvura Balarami Reddy and others. We shall dispose of them by this common judgment and will hereinafter refer to the State of Andhra Pradesh as the appellant and Duvvuru Balarami Reddy and others at the respondents. The brief facts necessary for present are these. The respondents had filed a writ petition for the issue of a writ in the nature of mandamus or any other ap propriate writ directing the appellant to give permission to the respondents to carry on mica mining operations in survey No.49/1 in the village of Ananthamadugu in Rapur Taluk of Nellore district subject to the respondents executing as agreement in the manner provided under the Mineral Conces sion Rules, 1949 (hereinafter referred to as the Rules) and conforming to the conditions mentioned therein. The case of the respondents was that they had obtained leases for mica mining purposes from various co owners in the shrotriem village of Ananthamadugu on March 24, 1952. Thereafter on May 27, 1953, this village was notified under the Madras Estates (Abolition and Conversion into Ryotwari) Act, No. XXVI of 1948, (hereinafter referred to as the Act) and the interest of the shrotriem owners was taken over by the appellant. The leases granted to the respondents were for a period of one year and one of the terms provided that the lessors were bound to extend and renew the period 176 of lease for such period as may be desired by the lessess subject to the Rules. After the estate was taken over, the question arose whether the leases were enforceable against the Government under s.20 "1 of the Act. In November 1953, the Manager of Estates, appointed on behalf of the Government, held that the leases were enforceable against the Government. This order was confirmed by the Collector of Nellore. Thereupon there was a revision petition by one of the co owners of the shrotriem who was not a party to the leases before the Board of Revenue. The respondents also applied to the Government for permission to work the mines. The Government however did not grant such permission. The respondents contended that the Government had no right to withheld permission to work the mines. Therefore, the writ petition was filed asking for the issue of a writ in the nature of mandamus or any other appropriate writ directing the appellant to give permission to the respondents to carry on mica mining in accordance with the leases. The petition was opposed on behalf of the appellant and the main contention on its behalf was that the village in question being a shrotriem inam village there was no presumption that the inam grant included the grant of sub soil rights also to the shrotriemdars. Therefore, the respondents could not claim any rights higher than these of their lessors. In effect, the appellant had contended that the lessors had no rights to the minerals and therefore the leases even if not void within the meaning of s.20 of the Act would not confer any rights on the respondents to claim as a matter of right the grant of permission to work the mines from the appellant and that it was entirely within the discretion of the State whether to grant a mining lease or not in accordance with the Rules. It was also stated in that the revision filed before the Board of Revenue had been stayed as the Points 177 raised before the Board were covered by the questions involved in the writ petition. On these pleadings the main question that arose for decision was whether the shrotriemdars had any rights in the minerals at all and were entitled to grant leases thereof If the shrotriemdars had no right in the minerals the grant of lease by them would be of no value and would not entitle the respondents to claim a mining lease under the Rules from the appellant as a matter of right. The learned Single Judge who heard the writ petition came to the conclusion that there was nothing to show that the inam grant in the present case covered the right to minerals. In consequence, it was held that the respondents did not get any rights under the said leases to the minerals. The learned Judge then considered the other points raised in the petition with which we are however not concerned and eventually dismissed it. The respondents went in appeal to a Division Bench of the High Court, and the appeal court seems to have held on a review of the various,standing orders of the Board of Revenue of the composite State of Madras that the State was only entitled to impose a royalty on minerals taken out by the shrotriem inamdar. It was pointed out that this seemed to be in accordance with common sense as the "grantee is entitled to the surface rights and the grantor to the sub soil rights and as the latter rights can only be exercised by entering upon the surface. it is only natural and just that they should share what is produced by working the mine, since one cannot enter upon the land, as he has no right to do so and the other cannot work the mine, as he has no right to the land". This would seem to suggest that the appeal court held that the sub soil right,,; belonged to the State and not to the inamdars; but because of the difficulty that arose on account of 178 the surface rights being in the inamdar and sub soil rights being in the State, it apparently head that the inamdar and the Government should share what is produced by working the mine. Finally, however, the appeal court dismissed the appeal on the ground that the period of one year for which the leases had been granted had expired and the period of renewal which the respondents could get under the Rules also had expired before the decision of the appeal court. It relied in this connection on the decision of this Court in K. N. Guruswamy vs The State of Mysore (1) : but as the respondents had failed on account of the expiry of time they were allowed their costs. This was followed by an application by the State for a certificate which was granted, and that is how the State 's appeal has come up before us. As for the appeal by special leave by the respondents, they contend that the decision being in their favour on the merits, the High Court should have ordered the State to grant them a lease even though the period fixed in the original leases and the period of renewal permissible under the Rules had expired. The main question therefore that fails for decision in these appeals is whether shrotriemdars can be said to have rights in the minerals. This matter has been the subject of consideration by the Madras High Court on a number of occasions and eventually the controversy was set at rest by the decision of the Judicial Committee in Secretary of State for India in Council vs Srinivasa Chariar (2) That case came on appeal to the Judicial Committee from the decision of the Madras High Court in the Secretary of State for India in Council vs,. Sreenivasa Chariar (3). The controversy before the Madras High Court was with respect to a shrotriem inam which was granted by the Nawab of Carnatic (1) ; (2) (1920) L.R. 48 I. A. 56. (3) Mad. 179 in 1750 and had been enfranchised by the, British Government in 1862. The inamdar started quarrying stones in the land granted to him and '. the Government claimed that it had a right to levy royalty or seigniorage fee on stones quarried by the inamdar. The inamdar contended on the other hand that an enfranchised inam was exactly. in the same position as a zamindari estate under the permanent settlement and that he was entitled to the entire sub soil rights and the Government was not entitled to levy royalty or seigniorage fee on stones quarried by him. The High Court held that under the terms of the grant, the grantor conveyed all that the grantor had in the. soil including sub soil rights and therefore it was not open to the Government to levy any royalty or seigniorage fee on stones quarried by the inamdar. In effect, the decision of the High Court negatived the claim of the Government to sub soil rights, for the Government could only levy royalty or seigniorage fee if it bad sub soil rights and the inamdar had no such rights. This decision was taken in appeal to the Judicial Committee as already indicated above, and the controversy between the parties, was that the inamdar claimed a decree establishing his full rights to the said village to the rocks and hills within its boundaries. The State on the other hand while admitting that there had been an inam grant of the village to the inamdar contended that there was no conveyance of the rights to minerals in the village. The Judicial Committee held that the grant of a village in inam might be no more than an assignment of revenue, and even where there was included a grant of land, what interest in the land pawed must depend on the language of the instrument and the circumstances of each case. The Judicial 'Committee also considered the standing orders of the Board of Revenue of 1890 and 1907 ,which have been referred to by the appeal court in 180 the judgment under appeal. This decision thus establishes that the mere fact that a ' person is the holde 'r of an inam grant would not by itself be enough to establish that the inam grant included the grant of sub soil rights in addition to the surface rights and that the grant of sub soil rights would depend upon the language used in the grant. If there are no words in the grant from which the grant of subsoil rights can be properly inferred the inam grant, would only convey the surface rights to the grantee, and the inam grant could not by itself be equated to a complete transfer for value of all that was in the grantor. In particular, the Judicial Committee stressed the use of the words "the produce of the seasons each year" used in the grant to show that, only the surface rights were granted in that case. It is not disputed that eversince the decision of the Judicial Committee in Srinivasa Chariar 's case(1) that has been the law with respect to sub soil rights of inamdars as distinct from zamindars under. the permanent settlement. The Boards standing orders of 1890 and 1907 to which the appeal court has referred in its judgment were also considered by the Judicial Committee and it is now too late in the day to use them to find out the rights of the inam dars and the Government in the minerals under the soil. As the decision of ' the Judicial Committee, shows, the standing orders of the Board of Revenue themselves show how the views of the Government changed from time to time on this question. , The older view seems to have been that the sub soil rights were in the inamdars but from 1907 at any rate the Government has taken the view that. sub soil rights are in the Government unless there: is anything in the grant to the contrary. It is this later view which was upheld by the Judicial, Committee in Srinivasa Chariar 's case(1).and this view has ever since prevailed as to the rights of the Government in the minerals under the soil in the case of (1) (1920) L.R.48 I.A. 56. 181 inams. We are unable to see bow this decision as to the rights of the Government to the minerals under the soil can be distinguished on the ground that the decision dealt only with the question of royalty. It is obvious that the Government could charge royalty only if it had the right to the minerals under the soil and not the inamdars. What therefore we have to see is whether on the terms of the grant in this case the shrotriemdars can be said to have been granted the sub soil rights also. So far as, this matter is concerned, here does not seem to have been a serious controversy in the High Court and it does not appear that the respondents contended that under the term$ of the grant to the shrotriemdars the latter were entitled to sub soil rights. We have already referred to that part of the judgment of the appeal court which suggests that ' even the appeal court was of the view that the subsoil rights were in the Government in this case and the surface rights were in the shrotriemdars. The orioinal grant is not available and all that we have is the inam fair register of 1861 and all that is stated in that register is that the grant is for the personal ad vantage of the holder. There is nothing therefore in the inam fair register to show that the grant included the grant of sub soil rights. It is however urged on behalf of the respondents that the grant included Poramboke, and from the fact that Poramboke was also included it should be inferred that mere surface rights were not the subject matter of the grant. Reliance in this connection has been placed on the decision of the Judicial Committee in Secretary of State vs Krishna Rao. The dispute in that case related to levy of water cess under the Madras Irrigation Cess Act, .(No. 7 of 1865). The Judicial Committee pointed out that the inam grant in that case included not only dry, wet. and garden land but also poramboke (1) (1945) L.R. 721.A. 211 182 i.e. unculturable land. This was held to indicate that full proprietary rights were granted and therefore the Government could not charge any water cess. It is urged for the respondents that this case shows that where poramboke is also granted, the grantee gets all the rights including the sub soil rights in full proprietorship. It should however be remembered. that the dispute in that case was whether the inamdar was entitled to free irrigation from water sources lying in the shrotiem village by virtue of the grant or whether the grantor could levy a cess under the Madras Irrigation Cess Act. There was no dispute as to the sub soil rights 'in that case, the dispute being confined to surface rights relating to water. The Government contended in that case that the grant to .the inamdar was only of the melvaram or the right of the revenue from the lands. while the respondent 's contention was that the grant I carried not only the meraram but also the proprietary interest in the land itself and therefore the Government had no right to levy the irrigation cess. It was in that connection that the Judicial Committee held that the grant of poramboke i. e. unculturable land, was one of the factors that indicated that it was not a mere grant of melvaram but full proprietary right. It is remarkable however that though the Judicial Committee came to the. conclusion in that case that full proprietary right had been granted, it referred to the earlier decision in Srinivasa Chariar 's case during the course of the .judgment. This later decision therefore in our opinion cannot be read in such a way as to lay down that wherever poramboke is included in the grant, a presumption must be drawn that the inam grant included sub soil rights also all that may be possible to infer by the inclusion of poramboke on the basis of this decision is that all the surface rights were granted and not merely the melvaram as 183 was contended in that case. The fact therefore that in the inam fair register in this case the grant includes poramboke would not by itself ' establish that sub soil rights were also included in the grant. So far as sub soil rights are concerned, they can only pass to the grantee if they are conferred as such by the grant or if it can be inferred from the grant that sub soil rights were also included therein. We have already remarked that the original grant in this case is not available and we have only the inam fair register to go ' by. There can be no doubt therefore on the facts of this case that the learned Single Judge was right in holding that the grant of sub soil rights to shrotriemdars is not established. The appeal court also does not appear to differ from this view of the learned Single Judge. Once the conclusion is reached that sub soil rights were not granted to the shrotriemdars it seems to us that the inference is plain ' that it was not open to the shrotriemdars to grant any lease of minerals lying under the soil to any one. Therefore, the leases granted by the shrotriemdars to the respondents in this case would be of no legal effect in conveying any right to them in the minerals under the soil. In the circumstances the respondents cannot put forward the leases in their favour to claim a mining leases under the Rules. With respect, we have not been able to understand how the difficulty which may arise in practice, on account of the sub soil rights being in the Government and the surface rights being in the shrotriemdars, in the working of the mines would make the shrotriemdars shares in the sub soil rights and therefore entitled to grant a lease of the sub soil rights. Whatever may have been the practice in the past and howsoever the Government may have been getting over the practical difficulty in the past would not confer any right to the minerals upon the shrotriemdar so as to enable 184 him to grant a mining lease to; any one. It follows therefore that the mining,, leases granted in this case were granted by persons who had no right to the minerals and therefore confer no rights on the respondents to claim at; of right from the Government that they should be granted a mining lease under the Rules. In view of the above decision appeal No. 252 must be allowed and appeal No. 253 must fail. We therefore allow appeal No. 252 and setting aside the order of the appeal court dismiss the writ petition with costs to the State throughout. Appeal No. 253 is hereby dismissed but in the circumstances parties will bear their own costs. C. A. No. 252 of 1958 allowed. C. A No. 253 if 1958 dismissed.

The, respondents has obtained leases for mining mica from the owners of a certain shrotriem village for one year with a stipulation that the lessors were bound to renew the leases for such periods as may be desired by the lessees. Shortly, there. after, the village waseanoified and the estate of the owners was resumed by the appellant. The respondent contended that 174 the appellant was bound to renew the leases. The appellant contended that the shrotriemdars had no right in the minerals, that they could not have granted any leases for mining the minerals and that as such no question of renewing the leases arose. Held, that shrotriemadras had no rights in the minerals and the leases granted by them to the respondent had no legal effect, The mere fact that a person was the holder of an inam grant was not by itself enough to establish that the inam grant included the grant of sub soil rights in addition to surface rights. The grant of sub soil rights depended upon the language used in the grant ; if there were no words in the grant from which grant of sub soil rights could be properly inferred it would only convey surface rights to the grantee. The original grant in the present case was not available and the inam fair register did not show that the grant included the grant of sub soil rights. No inference could he drawn of the grant of sub soil rights from the fact that the inam grant included poramboke (unculturable land) also. The difficulty that may arise in the working of the mines on account of the mines vesting in the state and the surface rights vesting in the shrotriemdars could not make the shrotriemdars co sharers in the sub soil rights so as to entitle them to grant leases of the subsoil rights. Secretary of State for India in Council vs Srinivasa Chariar, (1920) L. R. 48 1. A. 56, applied. Secretary of State vs Krishna Rao, (1945) L. R. 72 1. A. 21 1, distinguished.

ION: Criminal Appeal No. 120 of 1961. Appeal by special leave from the judgment and order dated March 17, 1961 of the Punjab High Court in Criminal Writ No. 2 of 1961. WITH Petition No. 147 of 1961. Petition under article 32 of the Constitution of India for enforcement of Fundamental Rights. The appellant/petitioner in person. H. section Doabia, Additional Advocate General, Punjab, Gopal Singh and P. D. Menon. for respondent (in the appeal and the petition.) 1961. November 2. 'The Judgment of Sinha, C. J., Subba Rao, Shah and Mudholkar, JJ, was delivered by Subba Rao, J. Dayal, J. delivered a separate Judgment. SUBBA RAO, J. Both these matters are connected and raise the same questions, and they may be disposed of together. Ranbir Singh Sehgal, the petitioner in the writ petition, is now a prisoner in the Central Jail Ambala, in the State of Punjab. He was prosecuted for committing offence in different places. On June 13, 1961, he was convicted by the Additional District Magistrate, Ambala, under section 5 of the Indian Explosive Substances Act and sentenced to 298 5 years rigorous imprisonment and to pay a fine of Rs. 2,000/ . The petitioner has preferred an appeal against the said conviction and sentence, and the said appeal is now pending the High Court of Punjab. On January 30, 1961, the Additional Sessions Judge (II), Ambala, convicted the petitioner under sections 120 B and 399 of the Indian Penal Code and sentenced him to 7 years rigorous imprisonment and a fine of Rs. 2,000/ under the former section, d to 5 years rigorous imprisonment and a fine of Rs. 2,000/ under the latter section. The petitioner preferred an appeal against this conviction and sentence to the High Court of Punjab and the same is now pending there. The other eases are not disposed of and they are still pending in various courts. The petitioner was arrested by the Ambala, police on September 11, 1958, and was detained in police custody for a period of about 8 months, and on May 7, 1959, he was transferred to judicial custody at Ambala. On June 13,1960, he was convicted under the Indian Arms Act, and from that date he is in the Central Jail, Ambala,, as a convicted prisoner. On December 15, 1960, the Governor of Punjab ordered that the petitioner should be treated as a 'B ' class prisoner. On February 9, 1961, he filed a petition under article "26 of the Constitution in the High Court of Punjab at Chandigarh, questioning inter alia his confinement in that prison on the ground that para. 575 of the Punjab Jail Manual where under he was confined to a separate cell in the prison, offended article 14 of the Constitution, and that in fact discriminatory treatment was meted out to him not for the maintenance of discipline but for extraneous reasons. That petition was dismissed by the said High Court on March 17, 1961, and Criminal Appeal No. 120 of 1961 was filed against the said order by special leave granted by this Court. That apart he also filed the present writ petition (Writ Petition No. 147 of 1961) in this Court under article 32 of the Constitution covering the same ground. The prisoner 299 argued his own case. He raised before us two points, namely, (1) para. 575 of the Punjab Jail Manual offends article 14 of the Constitution in as much as it confers arbitrary power on the Superintendent of Jail to deal with a prisoner under the colour of the said provision in a brutal way circumventing other stringent provisions of the Prisons Act and other paragraphs of the Punjab Jail Manual conceived in the interest and fair treatment of prisoners, (2) the Superintendent of Jail, for extraneous reasons on the pretext of disciplinary action, gave him solitary confinement in a cell since the date he was transferred to that Jail, and thus acted with mala fide. that apart, he discriminated him in the matter of treatment from other prisoners and even from the co accused, who were convicted along with him, and thus offended article 14 of the Constitution. The first question falls to be decided on the relevant provisions of the Indian Penal Code, the Prisons Act, and the Punjab Jail Manual. There are three types of punishment, namely, (i) solitary confinement,(ii) cellular confinement, and (iii) separate confinement. Solitary Confinement means such confinement with or without labour as entirely secludes the prisoner both from sight of, and communication with, other prisoners. The punishment of solitary confinement can be imposed by a Court only, and, in view of its dangerous potentialities stringent conditions are imposed thereon. No person can be sentenced to undergo solitary confinement for more than three months. There is a limit prescribed on the punishment of solitary confinement that can be imposed on a prisoner: it shall not exceed (a) one month, if the term of imprisonment does not exceed six months, (b) two months, if the term of imprisonment exceeds six months, but does not exceed one year, and (c) three months if the term exceeds one year: (vide section 73 of the Indian Penal Code). Section 74 of the Indian Penal Code says, 300 In executing a sentence of solitary confinement, such confinement hall in no case exceed fourteen days at a time with intervals between the periods of solitary confinement of not less duration than such periods, and when the imprisonment awarded shall exceed three months, the solitary confinement shall not exceed seven days in any one month of the whole imprisonment awarded, with intervals between the periods of solitary confinement of not less duration than such periods. " Section 29 of the Prisons Act reads, "No cell shall be used for solitary confinement unless it is furnished with the means of enabling the prisoner to communicate at any time with an officer of the prison, and every prisoner so confined in a cell for more than twenty four hour, whether as a punishment or otherwise, shall be visited at least once a day by the Medical officer or Medical Subordinate." Cellular confinement is a punishment which can be imposed on a prisoner by a Superintendent of Jail. A Superintendent of Jail can punish in a suitable case a prisoner by imposing on him cellular confinement for a period not exceeding fourteen days, provided that after each period of cellular confinement an interval of not less than such period must elapse before the prisoner is again sentenced to cellular or solitary confinement. Cellular confinement in defined to mean such confinement with or without labour as entirely secludes a prisoner from communication with, but not from sight of, other prisoners. Separate confinement is defined to mean such confinement with or without labour as secludes a prisoner from communication with, but not from sight of, other prisoners, and allows him not less than one hour 's exercise per diem and to have his meals in association with one or more 301 other prisoners. Separate confinement for a period not exceeding three months can be imposed on prisoner in a suitable case by the Superintendent of Jail. (Vide section 46(8) of the Prisons Act). Section 47 of the Prisons Act prohibits the combination of cellular confinement with separate confinement so as to prolong, the total period of seclusion to which a prisoner shall be liable. Solitary confinement can he given only by a court and the other two by a Superintendent of Jail for jail offences. The provisions conceived in the interest of the physical, moral and mental health of prisoners impose stringent conditions in carrying out those sentences in order to prevent their abuse. But in the interest of maintaining discipline among the inmates of jail, the Prisons Act and the Jail Manual prescribe rules for a separation of prisoners. The separation of prisoners depends upon the nature of the prisoner, the class to which he belongs and the availability of adequate number of cells. Section 27 of the Prisons Act provides that, (1) in a prison containing female as well as male prisoners, the females shall be imprisoned in separate buildings, or separate parts of the same building, in such manner as to prevent their seeing, or conversing or holding any intercourse with the male prisoners (2) in a prison where male prisoners under the age of twenty one are confined, means shall be provide for separating them altogether from the other prisoners and for separating those of them who have arrived the age of puberty from those who have not (3) unconvicted criminal prisoners shall be kept apart from convicted Criminal prisoners; and (4) civil prisoners shall be kept apart from criminal prisoners. Section of the said Act says, "Subject to the requirements of the last foregoing section, convicted criminal prisoners may be confined either in association or 302 individuals in cell or partly in one way and partly in the other". Presumably in exercise of the power conferred on the State Government by section 59 of the Prisons Act, certain rules were framed for the separation of prisoners and they are contained in the Jail Manual. Under para. 571 of the Jail Manual, 'shall convicts shall, so far as the requirements of labour and the cell accommodation of the Jail will allow, be kept separate both by day and by night. " Paragraph 572 deals with the occupation of vacant cells, and para. 573 says that " 'convicts of the habitual class shall be subjected to the system of separation prescribed in the preceding rules, in rotation. " Paragraph 574 provides. If, at any time, there are more cells in any jail than suffice for the separation of all convicts of the habitual class, prisoners of the casual class shall be confined in cells, both by day and night, in rotation. " Then comes the impugned provision, namely, para. 576, which reads: "A convict who would ordinarily came under the operation of any of the preceding rules relating to the separation of prisoners, but cannot be confined in a cell by day, by reason that he is required for some jail service, shall be confined in a cell by night. " There rules, along with the provisions of the Prisons Act, form an integrated scheme conceived for the maintenance of discipline of prisoners, and the preferential treatment in the allotment of cells is based upon sex, age, nature of the crime committed and the nature of the prisoners, and also the availability of cells. The question is whether para. 575 of the Jail Manual offends Act. 14 of the Constitution. The said provision is only in a group of rules providing for the separation of prisoners and it only says that if a prisoner to whom any of the prison rules 303 applies cannot be confined to a cell by day shall be confined in a cell by night. It pre supposes that the prisoner concerned belongs to the category to whom a separate cell is allotted and, by reason of his being required for jail service, cannot be confined to the cell by day: in such a case it says that he shall be confined to the cell by night. It is only a rule providing for a contingency when a prisoner who should be so confined in a cell both by day and night cannot be confined by day in such a cell. But the objection may be taken to mean that the other rules, along with this rule enable a Superintendent of Jail to put a prisoner in a cell offends article 14 of the Constitution. It is settled law that article 14 of the Constitution permits classification, and the said classification must bear just and reasonable relation to the object of the legislation. The object of the said provision is to maintain discipline among the inmates of jail. The classification is made on the basis of sex and the nature of the prisoners and also on the availability of cells. The classification has certainly a reasonable relation to the object sought to be achieved by the legislation nor can the power conferred on the Superintendent to separate prisoners be said to be arbitrary. The object of the conferment of the said power is very limited, and the provisions clearly lay down the conditions for separation. The power to separate is entrusted to the highest officer in the jail premises, who may ordinarily be expected to not reasonably, objectively and without bias. In these circumstances, we must hold that para. 575 of the Jail Manual in it setting does not offend the provisions of article 14 of the constitution. The next question is whether in purported exercise of the said power the Superintendent in the present case acted with mala fide and meted out discriminatory treatment to the petitioner and thus offended article 14 of the constitution the 304 affidavit filed in the Writ Petition, the petitioner made certain allegations against the Superintendent in respect of his treatment in jail. The said allegations may be summarized thus: The petitioner was transferred to the judicial custody at the Central Jail Ambala, on May 7, 1959, after protracted police custody of over eight months. On the very day of his arrival in the Jail, the petitioner was looked up in solitary confinement in a cell in the condemned prisoners block and lock up period of 24 hours inside the cell was clamped." Though several representations were made by the relatives of the petitioner to the higher authorities, no redress was given to him. He was sought to be kept in the cell for 13 months till June 13, 1 when he was convicted in one of the cases filed against him. On June 14, 1960, the Superintendent of the Jail again ordered the petitioner to be looked up in complete solitary confinement under para. 575 of the Punjab Jail Manual, and again a confinement of 24 hours inside the cell was "clamped". On December 15, 1960, the Governor of Punjab ordered that the petitioner should be treated as a 'B ' class prisoner, and even thereafter he was not transferred to the general ward of the prison where others ' class prisoners were kept confined, but he was kept in the same condemned prisoners wards Though the look up period of 24 hours inside the cell was considerably reduced the ban imposed on his association with other prisoners had not been relaxed. The petitioner was not allowed even to meet his co accused who were in the general ward of the prison. While the other prisoners in the jail including the petitioner 's co accused were given numerous facilities i.e. of association work and recreation he was completely segregated in a cell without any such facilities. The jail authorities adopted this method of torture for ulterior purposes, 305 The Superintendent of the Jail filed a counter affidavit. His answer to the grave allegations may be stated thus: on the very day of his arrival in the jail the petitioner behaved rudely and impertinently towards the jail staff and in a defiant way tried to undermine jail discipline. he was not kept in solitary cell for ulterior motives. He committed 12 jail offences and he was punished for them. After he was convicted he was put in a separate cell and that he was allowed one hour in the morning and one hour in the evening for exercise and also to have his bath outside the courtyard. After he was classified as a 'B ' class prisoner, he was given amenities to which a 'B ' class prisoner was entitled under the rules, but in the interest of jail discipline he was segregated from other prisoners. The cell in which the petitioner was kept was one of the cells in block of 32 cells out of which only were allocated for condemned prisoners and the rest were utilized for separate confinement for the segregation of hardened and troublesome convicted criminal prisoners. The petitioner was confined in the cell only for the night and he could move about in the open compound of the cell throughout the day. The affidavit and the counter affidavit disclose the following admitted facts: The cell in which the petitioner was and is confined is one of the cell in the block of 32 cells out of which 8 cells are used for condemned prisoners. The cell has a small separate enclosure of its own. From the date the petitioner entered the prison, that is, on May. 7, 1959, till he was convicted, that is, on June 13, 1960, when he was an under trial prisoner, he was separately confined to a cell. though the superintendent vaguely says that the petitioner was not looked up in a solitary cell, he practically admits that the petitioner was given separate confinement in a cell as punishment for jail offences committed by him. Though he 306 denies that the petitioner was kept in a cell for 24 thee hours, he does not say what facilities were provided for him to move about or mix with other prisoners. The statement of offences committed by the J. petitioner and the punishments inflicted on him filed by the Superintendent does not contain any details and is thus vague. Section 12 of the Prisons Act enjoins on a Superintendent to maintain a punishment book, and section 51 thereof requires him to enter the details therein. But the statement before us does not strictly comply with that section and it is represented in court that no other register is maintained in the jail. The statement, vague as it is, shows that even on the first day of imprisonment, the petitioner was kept in a separate cell and the offence alleged to have been committed by him is that he was rude and impertinent. The subsequent entries show that the petitioner attempted to break articles and even struck his head against wall or door. These acts of the petitioner appear to us to be more due to the effect of the inhuman and discriminatory treatment given to him even when he was an under trial prisoner rather than a conscious attempt on his part to commit any jail offences. Be that as it may, we are not concerned at this stage whether the petitioner had committed those offences, for those were committed at a time when he was an under trial prisoner with which we are not now directly concerned. The facts remain that even as an under trial prisoner from the date he entered the premises of the jail, he was segregated from other prisoners and kept in a separate cell. Now coming to the second period, that is, the period commencing from the date he was convicted till he was classified as a 'B ' class prisoner, that is from June 14 1960 to December 15, 1960, the petitioner alleges that he was kept in solitary confinement as before throughout 24 hours of the day. In the counter affidavit of the Superintendent 307 it is not denied that the petitioner was kept in a separate cell, but it is stated therein that he was given one hour in the morning and one hour in the evening for exercise and also he was allowed to have his bath outside the courtyard of the cell. The Superintendent does not state that he allowed the petitioner to communicate with others or to talk to other prisoners. It is not stated whether he was allowed for exercise to go out of the separate enclosure of the cell or whether he was allowed to mix up with other prisoners or to talk to them. During this period, the petitioner did not commit any jail offences and, therefore, his separate confinement in a cell could not be a punishment for an offence, but only for the maintenance of discipline in the jail and for convenience of accommodation. There is nothing on the record to suggest that he was guilty of any indiscipline during this period. If so, his confinement in a separate cell for a period of six months without allowing`him to communicate with others is a punishment of either cellular confinement, separate confinement or solitary confinement. The restrictions imposed on the prisoner on the pretext of separate allotment of a cell ignored even the limitations on the said confinements prescribed by section 73 of the Indian Penal Code or section 46 of the Prisons Act. The confinement of the prisoner in a separate cell in the manner it was done was certainly illegal. Coming to the third period after he was classified as a 'B ' class prisoner, the petitioner says that he was kept in the same condemned prisoners ' book with the exception that the look up period of 24 hours inside the cell was considerably reduced, but the ban imposed on his association with other prisoners was not relaxed. The Superintendent does not say that the petitioner was allowed to communicate or to speak with other prisoners. He also admits that the petitioner was continued to the 308 cell only in the night and that he can move about within the open compound of the cell throughout the days to put it in other words, the Superintendent admit that the petitioner is confined in a cell J. with a small separate enclosure and that the prisoner can only move in that enclosure in the morning. This kind of confinement is either a solitary confinement or cellular confinement, for it secludes the prisoner from communicating with or from the sight of other prisoners. If it is not a solitary confinement, it would certainly be a cellular confinement. Even in a separate confinement as a punishment the prisoner should be allowed to have one hour 's exercise per diem and to have his meals in association with one or more prisoners. The Superintendent therefore, acted illegally in confining the prisoner in the manner he did, and he is not entitled to do so under the rules prescribed for separation of prisoners. It may also be mentioned that during this period, there is no allegation that the petitioner 's conduct was otherwise bad. It is said that the confinement is neither solitary, cellular or separate, for he is allowed to go to courts. The fact that a prisoner is to be sent to a court on summons has no bearing on the question whether the confinement is legal or not. On the facts disclosed in the case, we have no doubt that, for one reason or other, which is not clear from the record, the petitioner was discriminated from other prisoners and, under the colour of the rules for separation, was illegally confined in a manner not authorized by law. Before closing we would like to make some general remarks. The modern development of criminology has revolutionized the system of treatment of convicted prisoners. The old brutal treatment has given place to more humane one. The concept of vengeance by society and of the deterence is fast disappearing and is being replaced by the concept of correction and rehabilitation. 309 Though our jail administration is moving with times, it is not keeping pace with advanced countries. A statute may reflect the modern trend and may contain salutary provisions for fair treatment of prisoners; but in practice much depends upon the Superintendent, who is expected to implement them in the spirit in which they are conceived. A superintendent of a jail may be a good disciplinarian, but it is not enough: he should also be a humanitarian possessing conscience and having an awareness that to his care is entrusted an abnormal class of society deserving more a sympathetic approach and sincere attempt at rehabilitation than that of vindictiveness. In this case, the Superintendent, as we have already stated, not only did not carry out the spirit of the rules but also broke the letter of the law and illegally placed the petitioner practically in solitary confinement from May 7, 1959 up to date. In the result we hold that the confinement of the petitioner in a separate cell in the manner it is being done in this case is illegal and we direct the respondent to confine the petitioner in the prison in strict compliance with the provisions of the Prisons Act and the rule made thereunder. It is for the Government to consider, in the circumstances of this case, whether it is a fit case for transferring the petitioner to some other jail. Writ Petition No. 147 of 1961 is allowed to the said extent, and there will be a similar order in criminal Appeal No. 120 of 1961. RAGHUBAR DAYAL, J. I have had the advantage of perusing the judgment prepared by my learned brother, Subba Rao J., and agree with him that paragraph 575 of the Punjab Jail Manual does not offend the provisions of the Constitution. I however do not agree that there had been any illegal confinement of the appellant. 310 The appellant was admitted to the jail as an undertrial prisoner for offences under section 19 of the Indian Arms Act and under section 5 of Indian Explosive Substances Act and the allegation was that he was concerned in a conspiracy with others to muder certain persons and to create disorder and anarchy in India. He behaved rudely and impertinently on admission into jail and showed a defiant attitude. In there circumstances, according to the affidavit of the Superintendent of the Jail, the appellant was ordered to be kept in cell under paragraph 569 A of the Jail Manual to maintain jail discipline. The entry in the punishment register, in this connection, states in the column meant for noting the offences: 'He is very rude and impertinent. He has defiant attitude and tries to undermine the jail discipline. ' I am of opinion that it was not necessary for the jail authorities to make a more detailed note in the register with respect to the various acts committed or words spoken by the appellant on the occasion. Section 51 of the Prisons Act provides what is to be recorded in this punishment book and requires to be recorded, among other matters, the prison offence of which the prisoner is guilty. It does not require a detailed account of the actions of the prisoner which constituted the prison offences. The description of the offences committed, suffices for the purpose of this register. The entry is not made for the purpose of adjudication of the offences or for the purposes of the appellate authority, if any. It is just a record of the conduct of the accused and the action taken. The Superintendent, in this case, did not inflict any punishment of solitary confinement or separate confinement on the appellant for his conduct. He simply ordered that the appellant be kept in a cell under paragraph 469 A of the Jail Manual. There had been eleven other occasions when the appellant committed prison offences. Those 311 offences and the action taken there are also mentioned in the punishment register and a copy of those entries has been filed in Court. What I have said in connection with the nature of the entry in connection with the incident on the day of admission, applies equally to the other entries mentioned above. The Superintendent has denied the allegations made by the appellant that he was kept in a separate cell, not in the interests of the jail discipline, but for ulterior motives or under orders of a vindictive Government. There is no material on the record to suggest that the Superintendent of the jail was actuated, in passing the order for keeping the appellant in a separate cell, by any consideration other than that of the interests of jail discipline. Therefore, the mere fact that the appellant was kept in a separate cell from the moment of his admission in jail does not indicate malafides on the part of the jail Superintendent. The appellant was kept segregated in a separate cell after his conviction as well, in view of paragraph 575 of the Jail Manual. He was allowed an hour in the morning and an hour in the evening for exercise. He was allowed to have a bath in the court yard outside the cell. The fact that the Superintendent did not state in his affidavit that he allowed the petitioner to communicate with others or to talk to other prisoners or that the appellant was allowed to mix up with other prisoners or to converse with them, does not necessarily mean that he disallowed any such thing or that, if he did so, the Superintendent acted against rules of law. The Superintendent denied that the appellant 's request to meet Hari Das was disallowed. There is no allegation that he had not been afforded the facilities which are to be provided to a prisoner or to a B class prisoner kept in a cell and therefore there was no occasion for the Superintendent to state about matters not complained of. 312 The mere fact that a person is kept in a separate cell will not make his confinement solitary, cellular or separate, though the difference between it and any of them be not appreciable. Section 27 of the prisons Act provides for separation of prisoners. If there happens to be only one prisoner of a particular category, he is necessarily to be kept separate from others. His being kept alone from other prisoners and his not being allowed to mix with other prisoners will not be called solitary or cellular or separate confinement. It is just an incident that he happens to be the only prisoner of a particular category and had therefore to be kept separated from all other prisoners in the jail. Section 28 allows convicted criminal prisoners to be confined either in association or individually in cells or partly in one way and partly in the other. The discretion is with the Superintendent of the Jail. The Act contemplates an individual prisoner to be kept in a cell. It is clear from the provisions of paragraphs 571 to 575 of the Jail Manual that the rules contemplate convicted prisoner to be kept separate. Paragraph 571 of the Jail Manual provides that all convicts, subject to cell accommodation and requirements of labour, be kept separate both by day and by night, and justifies the segregation of the appellant as a convicted criminal in a separate cell. Paragraphs 572, 573 and 574 lay down the order in which convicted prisoners are to be selected for being kept separate in cells when each of them cannot be so kept. All these provisions are consistent with what is enacted in section 28 of the Prisons Act. Paragraph 575 reads: "A convict who would ordinarily come under the operation of any of the preceding 313 rules relating to the separation of prisoners, but cannot be confined in a cell by day, by reason that he is required for some jail service, shall be confined in a cell by night. Note 1 Separation under paragraphs 571 to 575 is distinct from 'solitary ' confinement and 'separate ' confinement inflicted as a punishment under section 46 of the Prisons Act, and is restricted merely to the separation of individual prisoners either by day or night for purposes of jail management; such separation is not to have any irksome conditions attached to it. Note 2 Paragraphs 571 to 575 are of general application. If, in the opinion of the Superintendent, the presence of any convict in association with others, is detrimental to good order and discipline or is likely to encourage or lead to the commission of any offence, such convict should be kept separate, in preference to others of his class. " These provisions provide an exception to the provisions of paragraphs 571 to 574 and allow the convicted prisoner to be kept in a cell during night only instead of both by day and by night, in case he cannot be confined in the cell by day for reasons that he be required for jail service. Note 1 makes it clear that keeping prisoners separate in view of the provisions of paragraphs 571 to 575 is not 'solitary ' or 'separate ' confinement which can be inflicted as punishment and is merely separation of the prisoner for purposes of jail management. Further, Note 1 enjoins that no irksome conditions be attached to such separation. We are not shown that any such conditions were attached to the order for keeping the appellant in a cell. Note 2 further empowers the Superintendent of the Jail to keep a convict separate if he be of opinion that his association with others of his class 314 is detrimental to good order and discipline in the jail. The Superintendent states in his affidavit he that he was of such opinion. The entire scheme of the Act and the rules is that ordinarily a prisoner should be kept separated from others and that it is only in view of limitations of providing separate cells for each prisoner that prisoners of a particular category are kept together in a large hall. The order classifying the appellant as a B class prisoner further necessitated his being kept separate from other prisoners. There is no provision in the Act or the rules that a prisoner kept in a cell be specially allowed to associate or mix with other prisoners. The main grievance of the appellant is that he was not allowed to associate with his co accused, even for purpose of consultation with respect to the defence to be put up and the grounds to be taken in the appeal. The whole object of keeping convicted prisoners segregated in jail is defeated if they are allowed to meet and discus matters even when they are under special orders for being kept separate on account of their conduct being considered detrimental to jail discipline. If it was really necessary for the appellant to have consultations with his co accused for the purpose of the case, it was open to him to obtain orders of the Court and facilities for such consultations, if considered necessary, could have been given just as facilities are provided for accused to consult their counsel. I am therefore of opinion that the Jail authorities committed no discriminatory or illegal act against the appellant in keeping him in a separate cell. I would therefore dismiss both the writ petition and the appeal. BY COURT. In accordance with the opinion of the majority, the Writ Petition and the Appeal are allowed to the extent indicated in the majority judgment.

In May, 1959, the appellant was sent to Ambala Jail as an undertrial prisoner. On account of certain jail offences alleged to have been committed by him the Superintendent of Jail segregated him from other prisoners and kept him in a separate cell. He was convicted in June, 1960. Though he was 296 not alleged to be guilty of any jail offence or indiscipline after this date he was still confined in a separate cell without being allowed to communicate with other prisoners; he was only allowed to come out in the compound attached to the cell for one hour in the morning and for one hour in the evening. In December, 1960, the Governor ordered that the appellant be treated as a B" class prisoner. Even after this he was still kept in a separate cell with this difference that he locked up only at night and was allowed to move in the compound attached to the cell during the day. But he was still not allowed to communicate with others. The Prisons Act provided for the separation of prisoners and s.28 thereof permitted convicted criminal prisoners to be confined in cells either in association or individually. Paragraph 571 of the Punjab Jail Manual provided that so far as possible all convicts shall be kept separate both by day and by night. Paragraph 575 provided that a convict who could not be confined in a cell by day by reason that he was required for some jail service shall be confined in a cell by night. The appellant contended that his confinement was under para 575, that para 575 offended article 14 of the Constitution and that the Superintendent of Jail acted mala fide and discriminated against him by keeping him in solitary confinement. ^ Held, that para 575 of the Punjab Jail Manual did not offend article 14 of the Constitution. This paragraph was a part of an integrated scheme for the maintenance of discipline of prisoners by providing for their separation. The classification was made on the basis of sex and the nature of the prisoners and depended on the availability of cells; is had a reasonable relation to the object sought to be achieved. The power to separate was entrusted to the highest officer in the jail who was ordinarily expected to act reasonably, objectively and without bias. Held, further (per Sinha, C. J., Subba Rao, Shah and Mudholkar, JJ.) that the confinement of the appellant in a separate cell in the manner it was being done was illegal. The separation of the appellant so as to seclude him from communicating with or from the sight of other prisoners certainly amounted to cellular confinement if not to solitary confinement. This could only be done as a measure of punishment, and even then the prisoner was entitled to have one hour 's exercise every day and to have his meals in association with one or more prisoners. The appellant was discriminated from other prisoners and, under the colour of the rules for separation, was illegally confined in a manner of authorised by law. Per Dayal,J. There was no discrimination or illegality in keeping the petitioner in a separate cell. The mere fact 297 that a person was kept in a separate cell did not make his confinement solitary, cellular or separate. Paragraph 571 of the Jail Manual provided that subject to cell accommodation and requirement of labour all convicts be kept separate both by day and by night. Paragraph 575 provided an exception that where the convict could not be kept separate by day he could be kept separate by night. The entire scheme of the Prisons Act and the rules was that ordinarily a prisoner was to be kept separate and that only in cases of limitation of providing separate cells were prisoners to be kept together. There was no provision that a prisoner kept in a cell was to be specially. allowed to associate or mix with other prisoners.

Appeals Nos. 228 to 230 of 1960. Appeals from the judgment and decree dated February ' 4, 1957, of the Madhya Pradesh High Court (Indore Bench) at Indore in Civil Reference No.15 of 1952. B. Se??,, B. K. B. Yaidu and 1. N. Shroff, for the appellants. A. V. Viswanatha Sastri, K. A. Chitale, J. B. adachanji, section N. Andley, Rameshwar Nath and P. L. Vohra for the respondents. April 3. AYYANGAR, J. Rule 4 (1)(b) of Sch. 1 headed ((Rules for the computation of profits for the purposes of War Profits Tax" of the Gwalior War Profits Tax Ordinance, Samvat 2001 (hereinafter referred to as the Ordinance), provided: "4. In computing the profits of a business carried on by a company, no deduction shall be made in respect of (1) remuneration paid to directors if during any part of the accounting period concerned they had controlling interest in the company; 207 Provided that this sub rule shall not apply (a). . . . . . . . (b) to the remuneration of any managing agent where such remuneration is included in the profits of The managing agents ' business for the purposes of the War Profits Tax". The respondent Binod Mills Co. Ltd. which had its business at Ujjain in the State of Gwalior was a company whose profits were liable to War Profits Tax under the Ordinance. The company was managed by a managing agency firm M/s. Binodiram Balchand which had, by reason of its shareholding exceeding 50% of the issued sharecapital, a controlling interest in the company. The respondent company was assessed to War Profits Tax for three chargeable accounting, periods July 1, 1944, to December 31, 1944 , January 1, 1945, to December 31, 1945, and January 1, 1946, to June 30, 1946. During each of these accounting periods the respondent company had paid remuneration to its managing agents and claimed to deduct the remuneration so paid in the computation of its business profits during these three periods. The assessingofficer disallowed the claim on the ground that the remuneration received by the managing agency firm had not been factually assessed in the hands of the managing agent and that consequently the matter was covered by the opening words of r. 4 and not saved by proviso (b) to the rule. An appeal against this order of assessment was dismissed by the appellate authority and thereafter by the Commissioner of War Profits Tax in revision. But at the request of the respondent the Commissioner submitted a reference under section 46 (1) of the Ordinance to the 208 High Court of Madhya Pradesh of the following question for its decision: "Whether in computing the profits of a business carried on by a company deduction shall be made in respect of any remuneration to any managing agent where such remuneration is included in the profits of the managing agent 's business for the purposes of the War Profits Tax ?" There was a consolidated reference in respect of the three chargeable accounting periods. The learned Judges of the High Court answered the question in favour of the respondent and held that the remuneration, even though paid to a managingagent who had a controlling interest in the company, was a permissible deduction for the purpose of computing the profits of the company for the purposes of the War Profits Tax. The High Court was thereafter moved by the appellant for the grant of certificates of fitness for appeals to this Court under section 47 of the Ordinance and the certificates having been granted these three appeals, which relate to the three chargeable accounting periods have been preferred to this Court. Before proceeding further it might be convenient to set out certain facts to appreciate the form of the question which might provoke some enquiry. There was not much dispute, and even if there was, it was abandoned fairly early, that M/s. Binodiram Balchand were "directors" of the company within the meaning of the Ordinance and bad a controlling interest in the company. In this connection we might advert to the definition of ,director ' in section 2(10) of the Ordinance: "2. 'director ' includes any person occupying the position of a director by what ever name called and also includes any person who (i) is a manager of the company or 209 concerned in the management of the business; and (ii) is remunerated out of the funds of the business; and (iii) is the beneficial owner of not less than 20 per cent of the ordinary share capital of the company". The controlling interest being established, it was common ground that the remuneration paid to the managing agent could not be deducted in computing the profits of the company unless it fell within proviso (b) of r. 4(1). Before the departmental authorities it was suggested on behalf of the company that the expression 'included ' in proviso (b) meant ",disclosed in the return of the director" and on this basis it was contended that as M/s Binodiram Balchand had. , in the statement of their own Profit & Loss account for Samvat 2000, 2001 and 2002, disclosed the managing agency commission received by them the remuneration had been "included" in their profits for the purposes of the War Profits Tax, though for reasons which are unnecessary to discuss they claimed that the sum was not liable to be brought to tax and this claim was accepted. This argument which was rejected by the departmental authorities is however responsible for the form of the question referred to the High Court. This contention however was not apparently repeated before the High Court and does not figure in the judgment as part of the reasoning of the learned Judges in the judgment now under appeal and has not been relied upon before us. We shall therefore say no more about it, but proceed to deal with the substantial question raised. The facts being as above stated the entire question in the appeals turns on the mean of the 210 expression "is included in the profits of the managing Agency business" in r.4(1) proviso (b) of Sch. 1 of the Ordinance. Before however entering on a discussion of the words underlined and of proviso (b) in particular, it would be necessary to set out broadly the scheme underlying the levy of the tax under the Ordinance. Section 4(1) of the Ordinance is the charging section and it enacts : "4. (1) Subject to the provisions of this Ordinance, there shall, in respect of any business to which this Ordinance applies, be charged, levied and paid on the amount by which the profits during any chargeable period exceed the standard profits, an excess profit tax (in this Ordinance referred to as the 'War Profits Tax ') which shall be equal to 60 per cent. of the aforesaid amount. " The "business" to which the Ordinance applies has to be gathered from the terms of section 2 (5) which defines the term 'business '. That clause reads : " business ' includes any trade, commerce or manufacture or any adventure in the nature of trade, commerce or manufacture or any profession or vocation ' but does not include a profession carried on by an individual or by individuals in partnership, if the profits of the profession depend wholly or mainly on his or their personal qualifications, unless such profession consists wholly or mainly in the making of contracts on behalf of other persons or the giving to other persons of advice of a commercial nature in connection with the making of contracts : Provided that where the functions of a company or of a society incorporated by or under any enactment consist wholly or mainly in the holding of investments or other property or both, the holding thereof shall be 211 deemed for the purpose of this definition to be a business carried on by such company or society; Provided further that all businesses to which this Ordinance applies carried on by the same person shall be treated as one business for the purposes of this Ordinance". The second proviso uses the term 'person ' which is defined by section 2 (13) to include "any company or body of individuals or any other association of persons whether incorporated or not and also includes a Hindu undivided family". The 'Profits ' which is referred to in the charging section is, by reason of the definition of the term in section 2 (16), to mean ,profits as determined in accordance with the provi sions of this Ordinance and its First Schedule". The provisions of the Ordinance relating to the computation of profits do not bear upon the point now in controversy, but what is of relevance are certain of the Rules for the computation of the profits in Sch.1. From the terms of the charging section read with the other provisions of the Ordinance to which we have adverted it would be seen that it is the profits accruing from business that is brought to charge and that each person whether he be an individual or comprehended within the inclusive definition of the term ',person" is an independent unit of assessment whose profits are computed by aggregation of all of its sources of income from every business which that unit may carry on. How the profits of each unit is to be computed for the purposes of tax has to be gathered, apart from the provisions of the Ordinance which, as stated earlier, are not relevant to the present case, from Sch. 1 headed "Rules for the computation of profits for the purposes of War Profits Tax". Rule 1 of these Rules which generally follows the pattern of the Indian Income Tax Act in setting out the list of 212 permissible deductions, provides as one of such deductions in r. I. (1) '(xi) ,,any expenditure (not being in the nature of capital expenditure or personal expense of the person to whose business this Ordinance applies) laid out or expanded wholly and exclusively for the purposes of such business". If this provision were applied for computing the profits of a company as an unit of assessment, there, could be no dispute that generally speaking the remuneration paid to a managing agent would be an admissible deduction. It hardly needs to be mentioned that the remuneration received by a managing agent would be profits from business on which he would be, liable to tax under the Ordinance, being a profit from business as defined in section 2(5) subject only to the condition that the amount of the profit brought it within the taxable limit. To this prima facie rule as regards the manner in which the profits derived by a company are to be computed r. 4 enacts an exception, in the case of those companies in which the Directors have a controlling interest. But the application of this special rule as regards companies under the management of Directors with controlling interest is, however, subject, among others, to proviso (b) not applying to the case. In other words, if proviso (b) saved the case, the special rule as to controlled companies would cease to be applicable and the remuneration paid would be deductible in the computation of the companies ' profits. This turns on whether the remuneration paid to the managing agent "is included in the profits of the managing agent 's business". The words used being "is included" there is no doubt that an actual inclusion is posited. But this, however, does not solve the problem, for the , 'inclusion in the profits" might refer to three distinct "inclusions" : (1) the inclusion by the managing agents as an assessee for the purposes of his individual assessment, i.e., in his return, (2) the inclusion by the assessing authority in the order of 213 assessment made against the managing agent, (3) the inclusion under the terms of the Ordinance of the remuneration as an amount chargeable to the tax as part of the profits of the managing agent. In passing we might observe that r. 7 (2) (b) of Sch. 1 to the Excess Profits Tax Act, 1940, on which the Ordinance is modeled is in the same terms as the proviso (b) to r.4(1) of the Ordinance but the proper interpretation of the rule in the Excess Profits Tax Act has never come up before the Courts for decision. The contention urged on behalf of the appellant, before the learned Judges of the High Court was that the inclusion referred to an inclusion by the "essment officer of the remuneration in the assessment of the managing agent and that unless the remuneration sought to be excluded in the computation of the profits of the company was actually assessed in the hands of the managing, the company could not claim the benefit of proviso (b). The learned Judges repelled this submission by holding that the proviso could not be construed as to vest in the assessing authority an absolute discretion to assess either the company or the managing agent. They read the words ",is included" as equivalent to "is liable to be included" and that as it was not contested before them that if the assessment officer had been so minded he could have included this sum in the profits of the managing agent 's business, the terms of proviso (b) were satisfied. Mr. Sen learned Counsel for the appellant did not pursue the same line of argument as in the Court below. We should add that we consider that Mr. Sen was right in not attempting to support the argument which was rejected by the learned Judges of the High Court. Though tax laws occasionally make provision for the assessing authority to proceed against a particular unit of assessment on one or 214 more alternative bases, it would require 'very explicit and unambiguous language to permit an assessing authority to choose one of two units for assessment, particularly in, the context of there being no provision for the inter se adjustment of the rights and liabilities in the event of one unit benefiting at the expense of the other by reason of the exercise of the option and when admittedly the unit does not receive the income as agent for the other unit. Besides, if the company had been first assessed to tax because let us say its return had been filed earlier, or the enquiry as regards the correctness of the return was completed earlier, there is no provision /in the Ordinance or in the Rules for excluding the sum in the personal assessment of the managing agent, so that it could not be urged that the assessing authority had any option in the matter to tax either the company or the managing agent. If the managing agent is ex roncessis liable to have his remuneration included in his assessment for the tax, unless the income or the business is not within the Ordinance, it would be most anomalous to suggest that in order that the benefit of proviso (b) should be available to a company, the assessment of the managing agent should have been completed first a matter not always within the control of a company. We do not think it necessary to dilate further on this construction since Mr. Sen did not commend it for our acceptance. His submission, on the other hand, was that this was a special provision designed to meet the cases of companies in which the directors had a controlling interest. In such cases it was these directors who had to submit and submitted the return on behalf of the company and who, of course, had to submit their own returns in their individual capacity as persons in receipt of taxable profits. In these circumstances 215 he urged that the proviso should be read as conferring an option upon the directors either to include their remuneration in their own returns, get them taxed and pay the tax themselves or to include it in the company 's return and have the amount taxed in the company 's assessment. His further submission was that having regard to the manner in which the proviso was worded, where the managing agent failed to include his remuneration in his own return and have it assessed as part of his profits, the effect was the same as if he had opted to have the sum taxed in the company 's assessment. The option, it was urged, was that of the managing agent who controlled the affairs of a company and therefore in effect represented it and who in one capacity acted for himself and in another acted for the company. In effect the submission of learned Counsel was that the provision was designed to obviate double taxation of the same income and for this purpose vested the controlling Director with a discretion to render the company immune from tax where the sum was included in his own return and was assessed in his hands. The theory propounded regarding the provision being one for avoidance of double taxation in the manner above indicated by vesting a discretion in the controlling Director breaks even on a cursory examination. Let us assume that the managingagent opts to have the company taxed and submits a return on behalf of the company in which no deduction is claimed in respect of this item and an assessment is made accepting that return. On the terms of the Ordinance this would not afford any relief to the managing agent in his personal assessment, for admittedly there is, as pointed out earlier, no provision in the Ordinance or in the Schedule exempting the managing agent from the inclusion of this remuneration in his taxable profits, and this 216 must obviously be so, because for the purposes of the charging section he would be an independent unit of assessment. He would have to include in the computation of his personal income for the purpose of the War Profits Tax the remuneration received by him. This might be expressed in a slightly different form by stating that proviso (b) to r. 4(1) does not operate in the reverse direction, that is by exempting the managing agent from tax on the remuneration derived by him, merely because the deduction of that item has been denied to the company. Obviously therefore r. 4(1)(b) is not a rule designed for the avoidance of double taxation in the sense in which learned Counsel for the appellant suggests that it is. There are also other reasons why we find it unable to accept the submission of Mr. Sen that by the words is "included" is meant the inclusion in the return by the managing agent with the result that in cases where he does not so include, the company would not be entitled to the deduction. The option suggested by Mr. Sen to the managing agent was that he might either elect to pay the tax himself or get the company to pay it. Obviously it would always be in the interest of the managing agent to have the tax paid by the company if by that means, as is suggested by Mr. Sen, he could obtain absolution from the obligation of paying the tax himself, for if the tax is paid by the company the loss involved in the payment of the tax would fall on him only to the extent of his shareholding, being for the rest shared by the other share holders of the company. It is really difficult to understand the principle by which one could construe a rule of this nature as enabling a managing agent who holds, say 51% of the share capital of the company to visit 49% of the burden of tax which normally one would expect to be paid by him, to be paid by the other shareholders of the company merely because 217 he happens to be the managing agent holding a controlling interest by the extent of his share holding. We consider that the construction suggested by Mr. Son which leads to such an unreasonable result and inflicts an unjust injury on the other shareholders is not any proper interpretation of the provision. Besides, there are other grounds why the meaning attributed to the words "is included" as referring to "included ' by the managing agent" cannot be accepted. Suppose the managing agent includes it in his return but the assessing authority does not include it in the computation of his return but prefers to disallow the deduction in the case of a company. Would that be "inclusion in his pro fits?" Again, suppose the managing agent does not include it in his return but the assessing authority does, and tax is paid by the managing agent, would there be no exclusion? These illustrations serve to bring out the anomalies that would arise if it were held that the words ",is included" meant "is included in his return by the managing agent". This leaves for consideration the meaning that "is included" refers to the inclusion under the provisions of the Ordinance. If this meaning were accepted it would not matter whether the managing agent has or has not included the sum in his return or whether the assessing authorities have or have not done their duty by having the remuneration included in the taxable profits of the managingagent. If the managing agent has not done so being under an obligation imposed by the law to include it, the return would be liable to be revised by the assessing officer and if the failure to include the sum was due to any suppression, the managing agent would, besides having the sum included in his assessable profits, be liable to appropriate penalties for filing a wailfully incorrect return. Similarly, the assessing officer being under a statutory duty to include the sum in the assessment of the managingagent would, if he failed to do so, render the order 218 liable to be revised. The remedy for the failure either of the managing agent or of the assessing authorities to conform to the requirements of the law certainly cannot be the disallowance of the sum in the computation of the profits of the company. The entirety of this reasoning, it would be noted, proceeds on the basis that the managing agent was liable to include his remuneration in his assessable profits. In such a contingency it stands (to reason that neither the default of the managing agent as an assessee or of the assessing authority to include the sum in the profits of the managing agent could prejudice the rights of the company in the matter of the computation of its income. Where the remuneration of the managingagent was not under the Ordinance liable to be brought to tax the position would be different and that is just what is indicated as that which would render the proviso inapplicable. For instance, section 5(1) of the Ordinance enacts; ". Provided further that this Ordinance shall not apply to (a). . . . . . . . . (b) profit from a business carried on wholly on behalf of a religious or charitable institution and the profits of which are applied solely to the purpose of the institution and enure for the benefit of the public, and (i) the business is carried on in the course of the carrying out of a primary purpose of the institution, and (ii) the work in, connection with the busi ness is carried on by the beneficiaries of the institution". If for instance, the business of the managing agency was being carried on for or on behalf of a trust of 219 the character indicated by the provision just now read, the remuneration of the managing agent would not be liable to tax for the reason that it is outside the ambit of the Ordinance and to such a case the terms of proviso (b) to r. 4(1) would not be attracted, with the result that the managingagent not being liable to tax under the Ordinance on the remuneration derived by him, the company, if it were a controlled company. would not be entitled to the deduction of that remuneration in the computation of its profits. Except in case where the remuneration received by a managing agent is not liable to tax under the Ordinance, it is the managing agent that would be liable to pay tax on his remuneration and notwithstanding that the company is a controlled company the remuneration paid by it to the managing agent would be a permissible deduction by reason of the exception to the opening words of r. 4(1) contained in proviso (b). It is unnecessary for our present purpose to consider whether besides section 5(1)(b), already referred to, there are other contingencies in which remuneration received by a Director could be held not to be ,included ' in the latter 's profits under the Ordinance, since in the case before us it is admitted that the remuneration received by the managing agent was liable to be include in the computation of his profits for the purposes of the War Profits Tax and therefore neither the fact that the managing agent did not "include" the sum in his return, nor the default of the assessing authority to correct this error by " 'including" the sum in his assessment, is any reason for depriving the respondent company of the benefit of proviso (b) to r. 4(1). We therefore consider that the learned Judges of the High Court answered the question referred to them correctly. The appeals fail and are dismissed with costs. Appeals dismissed.

Sub rule (1) of r. 4 of Sch. 1 to the Gwalior. War Profits Tax Ordinance, Samvat 2001, provided: "In computing the profits of a business carried on by a company, no deduction shall be made in respect of the remuneration paid to directors if during any part of the accounting period concerned, they had controlling interest in the company; provided that this sub rule shall not apply (a). . (b) to the remuneration of any managing agent where such remuneration is included in the profits of the managing agents ' business for the purposes of the War Profits Tax". The respondent company was ' managed by a managing agency firm which had, by reason of its shareholding exceeding 50% of the issued share capital, a controlling interest in the company. The company was assessed to War Profits Tax under the provisions of the Gwalior War Profits Tax Ordinance, Samvat 2001, for three chargeable accounting periods between 1944 and 1946. During each of these accounting periods the company had paid remuneration to its managing ,agent and claimed to deduct the remuneration so paid in the computation of its business profits during these three periods. The assessing officer disallowed the claim on the ground that as the remuneration received by the managing agency firm had not been factually assessed in the hands of the managing agent, proviso (b) to r.4(1) of Sch. I was not applicable. It was found that the managing agents had in their statement of their own Profit and Loss account for the relevant years disclosed the managing agency commission received by them but they claimed before the assessing authority that the sum was not liable to be taxed and this claimed was accepted. Held, that the remuneration paid to the managing agents, even though they had a controlling interest in the 206 company, was a permissible deduction for the purpose of computing the profits of the company under the War Profits Tax Ordinance, Samvat 2001, ' because by virtue of proviso (b) to r.4(i) of Sch. 1 to the Ordinance, the managing agent was liable to include this remuneration in his assessable profits. The words "is included" in proviso (b) to r.4(1) refer to the inclusion under the provisions of the Ordinance. Neither the default of the managing agent as an assessee nor of the assessing authority to include the sum in the profits of the managing agent could prejudice the rights of the company in the matter of the computation of its income.

Appeal No. 538 of 1960. Appeal from the judgment and order dated September ' 3, 1958, of the Punjab High Court in Civil Reference No. 2 of 1956. B. Sen, D. Gupta and P. D. Menon for the appellant. The respondent did not appear. April 3. The Judgment of the Court was delivered by DAs GUPTA, J. In an appeal against the assessment of house tax of bungalow No. 127 B, Bank Road, Ambala Cantonment, by the assessment committee of the Cantonment Board, Ambala, three questions arose as regards the liability of the assessee on which the officer bearing the appeal entertained reasonable doubt and accordingly made a reference to the High Court of Punjab under a. 84 (2) of the , for the decision of these questions. Admittedly half of this Bungalow had been. appropriated under the provisions of the Cantonments (House Accommodation) Act No. VI of 1923 on a lease by the Central Government and was being used at the relevant time by some military officer for his residence. It was also admitted that the assessment list was signed originally by three of the four persons who formed the assessment committee and was signed by the fourth member a few days later. The appellate officer set out these circumstances in 198 his statement and then formulated the three questions thus .lm15 "1. Whether the occupation of the property by a Military Officer under the above circumstances amounts to user thereof for the public purpose. Whether the occupation of the Military officer of the portion of the Bungalow appropriated under Act No. 6 of 1923 amounts to its occupation by the Central Government, within the meaning of a. 99 (2)(6) of the . 3. Whether the authentication of the Assessment list in the present case is valid as required by the provisions of Section 69, ". The appellate officer who is required by section 84 (2) to state his own opinion on the points referred stated that in his opinion the occupation by the Military Officer, did not amount to user for a public purpose nor did it amount to occupation by the government and further that authentication of the assessment list was valid. The High Court answered the two questions in the affirmative and the third in the negative. In other words, the High Court 's opinion is that the occupation of the property by the Military Officer amounts to user or the public purpose an also amount to occupation by the Central Government within the meaning of section 99 (2) (f) of the and that the authentication was valid. Against the High Court 's decision on the second question the Cantonment Board has filed this appeal on the strength of a certificate granted by the High Court. 199 The assessee was not represented before us but we were taken through all the relevant provisions of law by Mr. Sen who appeared for the Cantonment Board. For a proper decision of the question in controversy it is necessary first to take note of the scheme of appropriation of houses under the Cantonments (House Accommodation) Act, No. VI of 1923. Under section 5 every house situate in a Cantonment is liable to appropriation by the Central Government on a, lease in the manner and subject to the conditions provided in the Act. Section 6 provides that (a) where a military officer stationed in the Cantonment or a President of a military mess in the Cantonment applies in writing to the officer commanding of the Station that he is unable to secure suitable accommodation by private agreement and no government property is available for the purpose and the Officer Commanding is satisfied of the truth of the facts stated or(b) the Officer Commanding is satisfied on enquiry that there is not in the cantonment a sufficient and assured supply of houses available at reasonable rates of rent by private agreement, the Officer Commanding may serve a notice on the owner of any house which appears to him to be suitable requiring him to permit the house to be inspected, measured and surveyed. Under section 7 if a Officer Commanding is satisfied thereafter that the house is suitable for occupation by a military officer or a military mess, he may by notice require the owner to execute a lease of the house to the Central Government; require the .existing occupier, if any, to vacate the house; and require the owner to execute the necessary repairs. The section further provides that on the expiry of the lease the house shall be re delivered to the owner in a state of reasonable repair. Section 11 of the Act provides that if a house is unoccupied, a notice under section 7 may require the owner to give possession of the same to the Officer Commanding within 21 days from the service of the notice and 200 if a house is occupied, a notice issued under section 7 shall not require its vacation in less than thirty days from the service of the notice. Section 12 provides that if the owner fails to give possession of a house to the Officer Commanding in pursuance of a notice issued under section 7, or if the existing occupier fails to vacate a house in pursuance of such a notice, the District Magistrate, shall enter the premises and enforce the surrender of the house. It is clear from this resume of some of the provisions of the Act that where as the appropriation can take place under the conditions mentioned in s.6" what happens on the appropriation having been made is that the house is made over to the possession of the Officer Commanding on behalf of the Central Government. What if; done with the house thereafter is not dealt with by the Act. Coming now to the provisions of the , we have to consider first section 65, which is in these words : "65. Save as otherwise expressly provided in the notification imposing the tax, every tax assessed on the annual value of buildings or lands or of both shall be leviable primarily upon the, actual occupier of the property upon which the said tax is I assessed, if he is the owner of the buildings or lands or holds them on a building or other lease granted by or on behalf of the government or the Board or on a building lease from any person. In any other case, the tax shall be primarily leviable as follows, namely a) if the property is let, upon the ' lessor; (b) if the property is sub let, upon the superior lessor; (c) if the property is unlet, upon the 201 person in whom the right to let the same rests. On failure to recover any sum due on account of such tax from the person primarily liable, there may be recovered from the occupier of any part of the buildings or lands in respect of which the tax is due such portion of the sum due as bears to the whole amount due the same ratio which the rent annually payable by such occupier bears to the aggregate amount of rent so payable in respect of the whole of the said buildings or lands, or to the aggregate amount of the letting value thereof, if any stated in the authenticated assessment list. An occupier who makes any payment for which he is not primarily liable under this section, in the absence of any contract to the contrary, be entitled to be reimbursed by the person primarily liable for the payment, and, if so entitled, may deduct the amount so paid from the amount of any rent from time to time becoming due from him to such person. " The right to impose the tax is conferred by a. 60. Section 99 (2) contains the provisions for exemption from the tax on property. It is in these words: "The following buildings and lands shall be exempt from any tax on property other than a tax imposed to cover the cost of specific services rendered by the Board, namely : (a) places set apart for public workshop and either actually so used for no other purpose; (b) buildings used for educational purposes 202 and public libraries, play grounds and dharam salas which are open to the public and from which no income is derived; (c) hospitals and dispensaries maintained wholly by charitable contributions; (d) burning and burial grounds, not being the property of the Government or a Board, which are controlled under the provisions of this Act; (e) buildings or lands vested in a Board; and ( f) any buildings or lands,used or acquired for the public service or for any public pur pose,which are the property of the State or in the occupation of the central or any State Government. The tax in the present case is not one imposed to cover the cost of specific services rendered by the Board and so if the property falls within any of the clauses mentioned in cis. (a) to (f) it will be entitled to exemption. We are not concerned, however, with cls. (a) to (e) as the only claim to exemption which has been made by the owner of the_ property is that it falls within el. The question is whether that claim is justified. It appears to us to be clear that to be entitled to the exemption under el. (f) the building or land must satisfy two conditions. First, that it has 'been used or acquired for public service or for public purpose, and secondly, that it is either the property of the State or in the occupation of the Central or any State Government. The finding of the High Court that the building was being used at .the relevant date for a public purpose is not disputed before us. That question therefore need not be further considered. What is disputed however is : Was it in the occupation of the Central 203 Government ? On behalf of the appellant, the Cantonment Board, Mr. Sen has strenuously urged that the portion of the building with which we are concerned in this appeal was in fact being occupied by a Military officer and such occupation is not occupation of the Government. It is to be made clear that while it is known that this portion of the building was appropriated by the government on lease under section 7 of the Cantonments ( House Accommodation) Act, it is not the appellant 's case that the occupation of the Military Officer was as a sub lessee of the government. Mr. Sen 's argument proceeded on the basis that the government being the lessee of this portion of the building permitted a Military Officer to occupy it. The question we have to consider is whether oil such occupation by the Military Officer the building ceased to be in ', ,he occupation of the Central Government, the lessee. It is worth noticing that while section 65 (1) speaks of actual occupation by the owner and makes the tax primarily leviable on the owner if he is the actual occupier, section 99(2) uses the words ((in the occupation of the Central or any State Government" and not "in the actual occupation of the Central or the State Government". Even so, it has been argued by Mr. Sen that the word "occupation" without anything more, should ordinarily be interpreted as actual occupation. While this may be correct, we find it difficult to agree that when a person, entitled to actual occupation by reason of his lease permits another to occupy it, then it ceases to be in the actual occupation of the person so permitting. Where the Central or the State Government after obtaining the lease under s.7 leases it out to any person, it is itself not entitled to actual occupation but has to put the sub lessee into occupation. In such a case it may be reasonably said that the government has ceased to be in occupation. 204 In the case where the government after taking the lease merely gives a licence to some person to come and live in it, it is entitled to take away the permission at any time and thus to come into possession itself. We can see no reason for thinking that in such a case the fact that the person to whom permission has been given is residing in the building, makes it anytheless the actual occupation of the government. If that was so, the fact that the Military Officer may be away for months together and the members of his family or his servants are residing would make the building cease to be in occupation of the Military Officer. That is on the face of it absurd. In our opinion, where the person entitled to occupy, permits some other person to be in the building, he is in actual occupation through such other person. Accordingly, we are of opinion that the building in question was in occupation of the Central Government through the Military Officer whom it has permitted to reside in it. The answers given by the High Court were therefore correct. The appeal is accordingly dismissed. But, as there was no appearance for the other side, there will be no order as to costs.

One half of bungalow No. 127 B, Bank Road, Ambala Cantt., was taken on lease by the Central Government and was being used by some Military Officer for his Residence The Assessment Committee of 'the Cantonment Board, Ambala, made an assessment of house tax but the assessment list was signed Originally by three out of four persons who formed the assessment committee and was signed by the fourth a few days later. The officer bearing the appeal entertained reasonable doubt and made a reference to the High Court under s.84(2) of the , for the decision of those questions. The questions referred to the High Court were : (1) Whether the occupation of the property by a Military Officer amounts to a user thereof for public purposes. (2) Whether the occupation of the Military Officer of the portion of the bungalow appropriated under Act VI of 1923 amounts to its occupation by the Central Government within the meaning of section 99(2)(f) of the Cantonment Act, 1924. (3) Whether the authentication of assessment list in the present form is valid as required by the provisions of section 96 of the . The High Court answered the two questions in the affirmative and the third in the negative. The opinion of the High Court was that the occupation of the property by the Military officer amounted to user for public purpose and also amounted to occupation by the Central Government and the authentication was valid. Against the decision of the High Court on the second questions the Cantonment Board went in appeal to the Supreme Court on the strength of a certificate granted by the High Court. 197 Held,, that the building in question was in occupation of the Central Government through the Military Officer whom it had permitted to reside in it. Where the person entitled to occupy, permits some other person to be in the building, he is in actual occupation through the other person.

Appeal No. 331 of 1961. Appeal by special leave from the judgment and order dated April 20, 1961, of the Punjab High Court in Civil Writ No. 460 of 1961. section P. Sinha and. M. K. Madan, for the appellant. Har Prasad and J. P. Goyal, for respondents Nos;. 1 and 2. section M. Sikri, Advocate General, Punjab, N. section Bindra and P. D. Menon, for the respondent No. 3. 1,962. April 4. The Judgment of the Court was delivered by AYYANGAR, J. ,The point arising for decision in this,appeal by special leave is,, a, very Shortly one and relaters to the proper construction of the definition of 'damaged area ' in section 2(d) of the Punjab 244 Development and Damaged Areas Act, 1951 which will hereafter be referred to as the Act. A few facts are necessary to be stated in order to appreciate how this point arises. The appellant claims to be the trustee of a Public Trust created for the management of certain properties situated in Amritsar. Of the properties belonging to the trust is one which is said to be a dharamshala. By a resolution of the Amritsar Improvement Trust dated March 21, 1957 the Improvement Trust decided to acquire a portion of this property for the purpose of widening a road under a development scheme framed under section 3 of the Act. This section enacts; "3. The Trust may frame a scheme or schemes for the development of a damaged area, providing for all or any of the matters mentioned in section 28 of the Punjab Town Improvement Act, 1922; and any scheme already framed or sanctioned in respect of a damaged area under the provisions of that Act shall be deemed to have been framed or sanctioned under this Act". Section 4 makes provision for the publication of the schemes setting out with particularity the properties which would be affected by the scheme and specifying the period within which the objections to the scheme would be received. Section 5 makes provision for the consideration of the objections which might be put forward under a. 4 and sub sections (3) and (4) of this section read; "5. (3) The State Government shall then notify the scheme either in original or as modified by it and the scheme so published shall be deemed to be the sanctioned scheme. (4) The publication under subsection (3) shall be conclusive evidence that a scheme has been duly framed and sanctioned," 245 Thereafter section 6 proceeds to make provision for the acquisition of property in the ', 'damaged area" and there are other provisions as regards the ascertainment and payment of compensation but as these are not relevant to the appeal, no reference to them is needed. It is common ground that a scheme has been framed under section 3 and this has been finalised after considering objections. It was in pursuance of this scheme that the Improvement Trust took steps to effect the acquisition of the property bearing Municipal No. 2320/1, 884/9 belonging to the appel lant trust. The appellant filed a suit for a declaration that the acquisition proceedings were illegal and ultra vires and for a permanent injunction restraining the Improvement Trust from proceeding with the acquisition. The suit was, however, withdrawn by reason of a Consent Memo which was filed and subsequently the appellant filed a petition under article 226 of the Constitution in the Punjab High Court challenging the validity of the action of the Improvement Trust and praying for appropriate reliefs quashing the proceedings for the acquisition. The petition, however, was summarily dismissed by the High Court by order dated April 20, 1961. The further petition filed by the appellant praying for a certificate of fitness under article 133(1)(c) was also dismissed. Thereafter the appellant obtained special leave of this Court to prefer an appeal against the judgment of the High Court and that is bow the appeal is now before us. Though several points have been, taken in the memorandum of appeal to this Court, learned Counsel confined his arguments to only one point to which we shall refer immediately and which alone requires to be dealt with in the appeal. We have already pointed out that the acquisition now sought to be made and which, it is contended, is illegal and not justified by law, is under a scheme 247 under the Act of 1947 vis a vis the definition in section 2(d) of the Act. By a proclamation issued under section 93 of the Government of India Act, 1935 the Governor of the Punjab assumed to himself the powers vested in the Punjab Provincial Legislature and under the powers so vested he enacted the Punjab Damaged Areas Act, 1947 (Punj. Act 11 of 1947). Section 3 of that enactment enabled the Provincial Government by notification "to declare any urban area, or any portion thereof to be a damaged area" and it was in Pursuance of this provision that the notification of April 1948, to which we have referred, was issued. It might at once be stated that the Act of 1947 contained no provision for framing schemes or for acquisitions of property for implementing such schemes, but this feature might not be very material for ,he purposes of this case. Section 93 of the Government of India Act, 1935 which made provision in cases of failure of constitutional machinery in the Provinces enacted by sub s.(4): "93.(4). If the Governor by a proclamation under this section assumes to himself any power of the Provincial Legislature to make laws, any law made by him in the exercise of that power shall, subject to the terms thereof, continue to have effect until two years have elapsed from the date on which the proclamation ceases to have effect unless sooner repealed or reenacted by an Act of the appropriate Legislature. . ." The rule of the Governor under s.93 ended on ' August 15, 1947 and in consequence this enactment which was temporary would have lapsed on August 15, 1949. Section 93 of the Government of India Act, 1935 was repealed by the Governor General under the powers vested in him by s.8 of 248 the Indian Independence Act, 1947 by virtue of the India (provisional Constitution) Order, 1947, but cl.6 of this order enacted: "6. Where any law made by the Governor of a Province by virtue of Section 93 of the Government of India Act, 1935, is in force immediately before the appointed day, the said law, notwithstanding that the said section is directed to be omitted is in Schedule to this Order or that by reason of such omission a Proclamation under the said section ceases to have effect, shall remain in force for the period for which it would have remained in force if the said section bad been At all material times in operation. " The result was that the Punjab Act of 1947 continued till August 15,1949 and no further. It was to make provision for the gap that would be caused by the expiry of this Act in 1949 that the Fast Punjab Damaged Areas Act, 1949, which is referred to in s.2(d) of the Act of 1951, was enacted. The Act of 1949 reproduced sub stantially the terms of the Act which it was replacing. Section 2 contained definitions which were in terms indentical with the definitions in the Act of 1947, subject to changes necessitated by the partition of the country and Lahore ceasing to be within India and s.3 which enabled the State Government by notification to declare an urban area to be a (damaged area" was brought into force at once, i.e., in April 1949 when the Governor 's assent was received, and by section 1(3) the State Government reserved the power to direct that the other provisions of the Act viz. ss.4 to 21 may come into force from such date as it may by notification appoint. In spite of diligent research no notification under section 1(3) bringing the rest of 249 the Act into force could be discovered in any event, there is nothing to show that the rest of the sections were brought into force before August 15, 1949 when owing to the laps; of two years prescribed by section 93(4) of the Government of India Act, the Act of 1947 expired and ceased to be in force. Based on the fact that the Act of 1949 practically reproduces, the earlier Act of 1947 the contention urged before us was that the Act of 1947 was in effect repealed and re enacted 'by the Act of 1949, that by virtue of section 22 of the Punjab General Clauses Act, which runs: "22 Where any Punjab Act is repealed and re enacted with or without modification, then, unless it is otherwise expressly provided, any appointment, notification, order, scheme rule, form or bye law, made or issued under the repealed Act, shall, so far as it is not inconsistent with the provisions reenacted, continue in force, and be deemed to have been made or issued under the provisions so re enacted, unless and until it is superseded by any I appointment, notification, order, scheme, rule, form or bye law made or issued under the provisions so re enacted." the notification issued under the Act of 1947 should be deemed to have been issued under the Act of 1949 and that in consequence the reference to a notification under the Act of 1949 in section 2(d) of the Act of 1951 would include the notification of 1948 made under the Act of 1947. We are unable to accept this argument. In the first place, there was no repeal of the Act of 1947 to attract the application of the rule of construction embodied in section 22 of the Punjab General Clauses Act. No doubt, even temporary enactments could be repealed and re enacted so as to attract the operation of provisions like a. 22 of 250 the Punjab General Clauses Act vide, for instance State of Punjab vs Mohar Singh (1). It is however conceded that here there is no express repeal of the Act of 1947. Learned Counsel for the respondents ,submitted that by reason of the very existence of the enactments of 1947 and 1949 on the Statute Book in terms identical with each other, the earlier ,statute should be held to have been impliedly repealed by the later enactment. If, as we have pointed out earlier, the first Act was temporary and ,Its place was taken by a later enactment after the former ceased to be in force, it is obvious that there could be no scope for invoking the principal embodied in section 22 of the Punjab Central Clauses Act. Further, apart from the larger question as the whether implied repeals are within the contemplation of section 22 of the Punjab General Clauses Act or similar provisions in like enactments, we 'consider that there is no basis for invoking the doctrine of implied repeal in the present case for that assumes that there is an inconsistency between the two enactments such that the two cannot stand together. It is a maxim of the law that, implied 'repeals are not to be favoured, and where two statute,% are entirely affirmative and identical no question of inconsistency could arise. Where the Operative terms of the two enactments are identical and the enactments, so to speak, run parallel to each other, there would be no scope for the application of the doctrine of implied repeal and that would be so particularly in a case where the earlier ,enactment is one of temporary duration while the later is a permanent enactment, even ignoring the fact that sections 4 to 21 'of the Act of 1949 were not in force during the life of the Act of 1947. Ultimately, the question would have to be decided on the pro per interpretation of section 2 (d) of the Act 'of 1951 under which the impugned scheme (1) [19S6] I S.C.R. 893 251 was framed and proceedings for acquisition are sought to be taken. It is clear that besides the areas notified under the Act of 1951 the only other areas contemplated are those which were notified under the Act of 1949 which on any normal and reasonable construction could only include the areas which were the subject of notification under section 3 of the Act of 1949 and not those under the Act of 1947 but which are deemed to be areas notified under the Act of 1949 assuming every submission of the respondent to be correct. In this view we consider that the appellant is entitled to the relief sought because the acquisition was in respect of a scheme for an area which it was not within the power of the Improvement Trust to frame under section 3 of the Act. Learned Counsel for the Improvement Trust made a furl her submission that the appellant was precluded from challenging the validity of the scheme by reason of the provisions of section 5 (4) of the Act (already extracted) which imparted a conclusive effect as to the legality of the scheme which had received the approval of the government and had been published under section 5 (3) of the Act. We are clearly of the opinion that there is no substance in this argument. The foundation of the jurisdiction of the Improvement Trust to frame a scheme and for the government to approve of the same depends upon the scheme relating to a "damaged area" and if, as we have held, the property now sought to be acquired is within an area which does not fall within the definition of a 'damaged area ' under section 2 (d) of the Act, it follows that there was total lack of jurisdiction on the part of the Improvement Trust or the government to frame a scheme for this area. The position is not very different from what it would have been if the Act itself bad not been extended to an area in regard to which a scheme 252 has been framed. The conclusive effect postulated by section 5(4) can only be in regard to the formalities prescribed 'by as. 3, 4 and 5 and does not touch a case where there is complete lack of jurisdiction in the authorities to frame a scheme. , The result is that the appeal succeeds and there will be a direction that the proceedings for the acquisition of the property belonging to the appellant under the Punjab Development of Damaged Areas Act, 1951 be quashed. The appellant will be entitled to its costs here. Appeal allowed.

The Amritsar Improvement Trust framed a scheme under section 3 of the Punjab Development and Damaged Areas Act, 1951, which empowered it to frame a scheme for the development of a damaged area, It passed a resolution to acquire certain property of the appellant for widening a road under the scheme. The appellant contended that the scheme was without jurisdiction as the area was not a "damaged area" within section 2 (d) of the Act which contemplated only two classes of areas, i. e. (i) areas which may, by notification, under the Act be declared by the Government to be "damaged areas", and (ii) areas already notified under the Punjab Damaged Areas Act, 1949. The respondents contended that a notification 243 issued under the Punjab Damaged Areas Act, 1947, which declared the entire walled City of Amritsar as a "damaged area" should be deemed to be a declaration" under the 1949 Act because of the operation of section 22 of the Punjab General Clauses Act and was sufficient to sustain the scheme and that the scheme could not be challenged as it had been notified by the State Government and under section 5 (4) of the Act the publication was conclusive evidence that the scheme had been duly framed and sanctioned. Held, that the scheme was without jurisdiction and that the proceedings for the acquisition of the appellant 's property were illegal. Admittedly the area had not been declared a "damaged area either under the 1951 Act or under the 1949 Act. The declaration under the 1947 Act was of no avail, firstly, because there was no basis for the argument that it would be "deemed to be a declaration" under the Act of 1949 and secondly even if it were so deemed the same was not within the definition of damaged area" in the Act of 1951. The appellant was not precluded by section 5 (4) from challenging the scheme and the acquisition ; since the collusiveness postulated by section 5 (4) was only in respect of the formalities prescribed by sections 3,4 and 5 and did not touch a case where there was complete lack of jurisdiction in the authorities to frame a scheme.

Appeal No. 105 of 1952. Appeal from the Judgment and Decree dated the 16th September, 1949, of the High Court of Judicature at Madras (Subba Rao and Chandra Reddi JJ.) in Appeal No. 162 of 1946 arising out of Judgment and Decree dated the 30th November 1945 of the Court of the Subordinate Judge of Tanjore in Original Suit No. 34 of 1945. section Ramachandra Iyer, for the appellant. T. R. Srinivasan, for the respondents. February 27. The Judgment of the Court was delivered by MAHAJAN J. One Thangathammal who was a dasi (dancing girl) lived in the Tanjore district in Madras State and died possessed of some properties. She left her surviving three daughters, Saraswathi, Jagadambal and Meenambal. Jagadambal filed the suit out of which 941 this appeal arises against her sisters for partition of the movable and immovable properties set out in the plaint and for allotment of a third share to her therein. She alleged that her mother was married to one Thyagaraja Pillai, that the properties in suit were the stridhanam properties of her mother who died intestate on 26th July, 1943, and that according to the law or custom of the community to which the parties belonged she and her sisters were entitled to share equally the properties of her mother. Saraswathi Ammal, the 1st defendant contested the suit. She pleaded that her mother was not a married woman but a dasi who followed her hereditary occupation and was attached to Shri Saranatha Perumal temple at Tiruchurai in the Tanjore district, that of the three daughters the plaintiff and the 2nd defendant married and lived with their husbands, while she (1st defendant) was duly initiated as a dasi in the said temple and remained unmarried and that according to the law and custom of the community, the mother 's property devolved solely on her to the exclusion of the plaintiff and the 2nd defendant. The 2nd defendant supported the 1st defendant 's case. The material issue in the suit was issue No. 1 which was in these terms: " Who is the proper heir of Thangathammal. Whether according to custom as set tip by the plaintiff, all the daughters are heirs, or according to the custom put forward by the 1st defendant, the unmarried daughters alone are entitled to inherit." The Subordinate Judge dismissed the suit holding that Thangathammal was a dasi and not a married woman, that according to the custom of the dasi community in South India, a dasi daughter is regarded as a nearer heir to the mother than a married daughter and that the 1st defendant was entitled to remain in possession of the suit properties. Against this decision an appeal was taken to the High Court. The High Court reversed the decree of the Subordinate Judge and held that the custom pleaded by the 1st defendant 942 was not proved and that the rule of propinquity of Hindu law as a rule of justice, equity and good conscience, governed the succession and the married and dasi daughters were equally entitled to the inheritance. It was further held that a dasi daughter was not in the status of a maiden or unmarried daughter for purposes of succession to stridhanam property. Leave to appeal to the Supreme Court was granted under article 133 of the Constitution. After bearing the learned counsel for the appellant, we feel no hesitation in concurring with the decision of the High Court. It was contended that the High Court was in error in holding that the custom set up by the defendant was not proved. To prove the custom that a dasi daughter was a preferential heir and excluded her married sisters reliance was placed on, the evidence of some members of the community and reference was also made to certain instancese same kind of evidence was led by the plaintiff support of her case. The evidence of both the parties on the the issue of custom is of an unsatisfactory and inconclusive character and from it no inference can be drawn of the existence of a uniform, certain and ancient custom prevailing in the community on this point. Out of the defendant 's witnesses, the first witness, Rajagopal Pillai, deposed that his wife was the daughter of dasi Kamakshi who had six daughters of whom three were married and three were dasis, that on Kamakshi 's death, her dasi daughters alone would take the inheritance and that his wife, would be excluded. This statement does not hurt him in any way as his wife will not be bound by what be might state. His bald assertion about the custom in the community is not of much value. He does not disclose any source of his information. In cross examination he admitted that he did not know a single specific instance where such a custom was enforced . The second witness on the point is the first defendant. She stated that one Tulasi 's sister Mangalam got no share in her mother Ammani 's properties. In cross examination it was admitted that Mangalam died about fort years ago, 943 i.e., some time before the defendant was born. She could therefore have no personal knowledge about Ammani 's instance. No written record of that inheritance is forthcoming. Mangalams son Govindaswami Pillai appeared as D. W. 3. He deposed that Mangalam 's mother Ammani had divided her properties between her dasi daughters in her lifetime. The instance therefore is not an instance concerning succession and cannot be treated as relevant in this enquiry. The 1st defendant further deposed to an instance in Srirangam when succession opened out on the death of dasi Chellappa. It was said that her property was taken by her dasi daughter Visalakshi to the exclusion of her married daughters Marakatham and Rukmini and that the assets were worth a lakh of rupees. One would have expected some written documents about that sucession if it took place in the manner deposed to. In the absence of any evidence from the descendants of Chellappa and in the absence of any documentary evidence regarding that succession it is difficult to place any reliance on this so called instance. Defendant No. I stated that her knowledge of it was only from hearsay, and the requirements of section 32 of the Evidence Act not being fulfilled, her evidence on this point cannot be treated as admissible. The third witness, about whom reference has already been made, apart from deposing as to Mangalam 's instance also deposed about the instance of dasi Meenakshi. Her daughter Jeevaratnam is married to the witness. He said that Meenakshi 's dasi daughters inherited her property and that his wife was excluded. The only property alleged to belong to Meenakshi was a house, the value of which is not known. The succession is said to have occurred over twenty years ago. None of the daughters of Meenakshi have been examined as witnesses in the case, to enable the court to find out the details about it and merely on the statement of this witness the instance cannot be held proved. The fourth witness for the defendant is her non contesting sister. She said nothing on the on the question of custom. She, however, stated 944 that she was not entitled to a share in the assets of her mother. When asked why she was making that statement, she said that she was saying so because her husband and some. elders (whose names were. not disclosed) had told her so. Evidence of this character on the question of custom cannot be seriously considered. Venugopal Pillai is the fifth,witness for the defendant. He is the husband of the second defendant. His evidence regarding the instance of Chellappa is purely, hearsay. He deposed that he had learnt that a dasi 's married daughter is not entitled to claim a share as she is not her heir in the presence of a dasi daughter and therfore he told his wife not to claim a share. He did not disclose the source of his information. Janaki Ammal, the sixth witness, is a dasi. She deposed that she has five daughters of whom two are married, one is a dasi and the other two are young girls and that according to their caste custom her properties on her death would devolve on her dasi daughters and that the married daughters must remain content with the presents given at their marriage. In cross examination she admitted that she was deposing about the caste custom not from any specific instance in which the custom was observed but at the request of the defendant, and that she bad heard of this custom from her elders whose names she did not disclose. She further admitted that she had an uncle living but she did not even ask him about the custom. The witness, it appears, knows nothing about the custom and is giving evidence in order to oblige the defendant. The next witness 'Who gave evidence on the issue is D. W. 8, Kamalathammal, a dasi. Her mother was also a dasi. She deposed that her mother 's properties were divided between her and her other dasi sister and Amba, her third sister, who was married, was not given a share. In cross examination she admitted that Amba never asked for a share. Neither was Amba produced, nor any written munici pal records showing that the witness actually inherited the property of her mother to the exclusion of Amba. It is difficult to hold this incident proved merely on the 945 vague testimony of this witness. Pappathi Ammal, the next witness in the case, is also a dasi. She deposed that her father 's mother 's property devolved on her two dasi daughters on her death and that there was no married daughter in existence. This evidence is of a neutral character and is not of much use on the question of custom pleaded in the case. Apart from asserting that in this community dasi 's property devolves on her death only on the dasi daughters to the exclusion of married daughters, she cited the instance of Chellappa, a dasi of Srirangam. It was elicited in cross examination that Chellappa left a house and landed properties. No explanation is forthcoming why documentary evidence of revenue records about this instance has been withheld. Oral evidences as to instances which can be proved by documentary evidence cannot safely be relied upon to establish custom, when no satisfactory explanation for withholding the best kind of evidence is given. The last witness in the case is Rajamani Ammal, another dasi who does service in Sri Ranganathaswami temple. She also referred to the instance of Chellappa. She said that her jewels which were worth Rs. 1,000 would pass on her death to her dasi daughter. She went to the length of saying that if a dasi leaves an only child who is a married woman, even then her properties will pass to a next heir such as a cousin and not a married daughter. This is all the evidence led by the defendant to prove custom. On this meagre and unsatisfactory material we cannot hold that the custom pleaded is proved. The opinion evidence is not of a convincing character and evidence as to specific instances in support of the custom is really nil. Our attention was also drawn to a decision of the Madras High Court in Shanmugathammal vs Gomathi Ammal(l) In that case the plaintiff, a member of the dasi community, claimed to succeed to her deceased maternal aunt and pleaded that the three surviving sisters of the deceased who were impleded as defendants were not entitled to inherit because one of them (1) 122 946 had been adopted by another dancing girl and the other two had become married. The issue raised in the case was whether the custom set up by the plaintiff that among dancing women married women are excluded by a woman who continues to be ' a dasi is true, valid and enforceable. Certain dasis gave evidence in support of the custom. No evidence whatever was given to the contrary and the custom pleaded was held proved in the circumstances of that case. Emphasis was laid on the circumstance that there was no evi dence whatsoever against the plaintiff and defendants 2 and 3 who denied the existence of the custom in their written statements did not venture to deny it on oath in the witness box. The dasi community concerned in that case was a small one consisting originally of twenty houses of which only seven or eight were then in existence and in that situation it was said that the custom might well be one that was well recognized and so much a part of the consciousness of the community, that any dispute like the present dispute amongst so small a body of women would be an extremely rare occurrence and therefore impossible of proof and that the plaintiff could not reasonably be expected to search the presidency for witnesses to speak to some similar dispute in other places. In our opinion, that decision does not furnish a good judicial instance in respect of the custom pleaded in the present case. There is no evidence that the customs of that small community of dasis are applicable to the community of dasis in the present case which form a considerable community in this district. Moreover, the case was decided on the peculiar circumstances of that case on very meagre materials and did not lay down any general custom of dasis on this point. It is unnecessary to examine the plaintiff 's evidence in detail. Suffice it to say that it is more than sufficient to rebut the evidence led by the defendant and it neutralizes its effect, if any. In the absence of proof of existence of a custom governing succession the decision of the case has to rest on the rules of justice, equity and good conscience because admittedly no 947 clear text of Hindu law applies to such a case. The High Court thought that the just rule to apply was one of propinquity to the case, according to which the married and dasi daughters would take the mother 's property in equal shares. No exception can be taken to this finding given by the High Court. No other rule was suggested to us leading to a contrary result. It was argued that the dasis have a distinct status in Hindu society and, that a rule has been evolved by judicial decisions under which the state of degradation by itself furnishes a rule of preference in a competition between dasi daughters and married daughters. The juidicial decisions referred to concern the community of prostitutes and the rule evolved concerning them has been abrogated by later decisions. It was contended that though the said rule had been abrogated and was no, longer applicable to that community concerning which it was evolved, it should by analogy be applied to cases of succession to dasis. Narasanna vs Oangu(1) was the first case cited. There, an adopted niece of a prostitute dancing girl was preferred to a brother remaining in caste. It was said that the legal relation between a prostitute dancing girl and her undegraded relations remaining in caste becomes severed and they are therefore not entitled to inherit the estate. In Subbaratna Mudali vs Balakrishnaswami Naidu(2), the next, case cited, the facts were that a deceased woman Palani inherited the property in dispute from her mother Nagu, who inherited it from her mother Mottai who again inherited it from her father Arunachalam. Arunachalam had two brothers Ramaswami and Mathurbutham and the question in that case was whether Mathurbutham 's daughter Seethai or Ramaswami 's daughter 's son Marudamuthu Mudali was the heir of Palani. The learned judges held that Mathurbutham 's daughter was preferential heir to Ramaswami 's daughter 's son. It was pointed out that the rule of preference based on degradation was no longer good law. It was, however, (1) I.L.R. (2) 33 M.L.J. 207. 948 added that in cases of dancing girls the law remained as it was before. Our attention was also drawn to certain observations in Subbaraya Pillai vs Ramaswami Pillai(1) at page 177, and to the decision in Balasundaram vs Kamakshi Ammal(2). In the former case the learned Judges rejected the broad proposition that Degradation of a woman in consequence of her unchastity entails in the eye of the law cessation of the tie of kindred between her and the members of her natural family and also between her and the members of her husband 's family. We think that decision on this point is sound in law. Degradation of a woman does not and cannot sever the ties of blood and succession is more often than not determined by ties of blood than by the moral character of the heir. In Balasundaram vs Kamakshi Ammal(2) it was held that the property acquired by the mother had been acquired by her as a married woman and notwithstanding her lapse into unchastity, it devolved on her daughters clothed with the ordinary character of property acquired by a Hindu female, that is to say, the daughters took a life estate in it. The learned counsel attempted to persuade us to hold the custom pleaded proved by the assistance of decisions given in analogous cases and by applying the principles of the rules said to have been, enunciated in some of them. Those cases were decided on their own facts and in some of them a rule was enunciated that degraded people are a class by themselves and their degraded relations are preferential heirs to the undegraded ones. As already said, we cannot subscribe to the view that any such rule can be evolved merely on logical grounds. Its existence can only be justified on the basis of established custom. No trustworthy evidence has been led in this case to establish that the daughters of a dasi by marriage lose their right of inheritance and form a separate community. The correct approach to a case where a party seeks to prove a custom is the one pointed out by their Lordships of the (1) I.L.R. (2) 949 Privy Council in Abdul Hussein Khan vs Soma Dero(1). It was there said that it is incumbent on a party setting up a custom to allege and prove the custom on which he relies and it is not any theory of custom or deductions from other customs which can be made a rule of decision but only any custom applicable to the parties concerned that can be the rule of decision in a particular case. It is well settled that custom cannot be extended by analogy. It must be estabished inductively, not deductively and it cannot be established by a priori methods. Theory and custom are antitheses, custom cannot be a matter of mere theory but must always be a matter of fact and one custom cannot be deduced from another. A community living in one particular district may have evolved a particular custom but from that it does not follow that the community living in another district is necessarily following the same custom. The last point taken by the learned counsel was that under Hindu law the 1st defendant as a maiden was entitled to preference over her married sisters. Defendant No. I was admittedly married to the idol and she has been on her own show. living a life of prostitution. The text of the Mitakshara dealing with the case of a virgin can. not be applied to her case. [Vide Tara vs Krishna(1)]. It is inconceivable that when the sages laid down the principle of preference concerning unmarried daughters they would have intended to include a prostitute within the ambit of that text. For the reasons given above we see no force in this appeal and it is dismissed with costs. Appeal dismissed, Agent for appellant: section Subramaniam. Agent for respondent No. I : M. section K. Aiyangar.

The evidence on record did not establish the custom which had been pleaded, namely that among the community of dasis 940 (dancing girls) in South India a dasi daughter succeeded to her mother in preference to the married daughters; and in the absence of such custom, succession to a dasi must be governed by the rule of propinquity of Hindu law as a rule of justice, equity and good conscience and dasi daughters and married daughters would succeed to their mother 's property in equal shares. A rule that degraded relations are preferential heirs to undegraded ones cannot be evolved merely on logical grounds the existence of such a rule can only be justified on the basis of established custom. Custom cannot be extended by analogy. It must be establish ed inductively, not deductively, and it cannot be established by a priori methods. It cannot be a matter of mere theory but must always be a matter of fact and one custom cannot be deduced from another. Shanmugathammal vs Gomathi Ammal , distin guished. Narasanna vs Gangu (I.L.R. , Subbaratna Madali vs Balakrishna Naidu (33 M.L.J. 207), Subbaraya Pillai vs Ramaswami Pillai (I.L.R. , Balasundaram V. Kamakshi Ammal , and Abdul Husein Khan vs Soma Dero (I.L.R. P.C.) referred to. The rule of Hindu law by which a maiden is a preferential heir to her married sisters does not apply to daughters who are admittedly married to an idol and lead a life of prostitution. Tara vs Krishna (I.L.R. referred to.

Appeal No. 455/59. Appeal by special leave from the judgment and order dated January 16, 1956, of the former 429 Nagpur High Court, in Misc. Petition No. 448 of 1954. N. section Bindra and D. Gupta, for the appellants. Purshottam Trikamdas, G. J. Ghate and Naunit Lal, for the respondents. April 6. The Judgment of the Court was delivered by MUDHOLKAR, J. The respondent was a proprietor of mauza Bhivapur, Tehsil Umerer, District Nagpur. His proprietary interest in the village was abolished by the Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act, 1950 (M.P. 1 of 1951). By virtue of section 4 of the Act, ill rights, titles and interests, among others, in all pathways, village sites, hats, bazars and melas in Bhivapur vested in the State of Madhya Pradesh for the purposes of the State free from all encumbrances under section 4(1)(a) of the Act. Under the provisions of the those rights vested in the State of Bombay and now by virtue of Bombay Re Organisation Act, 1960 (11 of 1960) in the State of Maharashtra. The provisions of section 4(1)(a) are as follows: " All rights, title and interest vesting in the proprietor or any person having interest in such proprietary right through the proprietor in such area including land (cultivable or barren) grass land, scrub jungle, forest, trees, fisheries, wells, tanks, ponds, waterchannels, ferries, pathways, village sites, hats, bazars and melas;. . shall cease and be vested in the State for purposes of the State free of all encumbrances; and the mortgage debt or charge or any proprietary right shall be a charge on the amount of compensation payable for such proprietary right to the proprietor under the provisions (if this Act" 430 After the Act came into operation proceedings for compensation in respect of the village Bhivapur were started in the court of the Compensation Officer, Umrer, in Revenue case No. 583/1 A 4/1950 51 decided on January 19, 1952. The Compensation Officer held that 0. 14 acres of land out of Khasra No. 61/1 which is recorded in the village papers as abadi wherein a bazar is held, should be settled with the respondent under section 5(a). On a portion of the land which was used for bazar, ottas and chabutras, with or without sheds, and separated by passages, exist. It is common ground that they belong to the respondent. It is also common ground that the land covered by ottas and chabutras on which sheds have been constructed were ordered to be settled on the respondent in the revenue case referred to above. The respondent 's contention, however, was that not only the sheds and the land on which those sheds were erected but also the open uncovered ottas and chabutras should also have been settled with him by virtue of the provisions of section 5(a) of the Act along with the land appurtenant to those structures. The total area of this land, according to him, is 2.85 acres. The respondent, therefore, preferred an appeal against the order of the Compensation Officer which directed settling only 0.14 acres of land on him. That appeal was. however, dismissed by the Additional Commissioner of Land Reforms and Additional Commissioner of Settlement, Madhya Pradesh, on March 28, 1952. The respondent thereafter was asked to remove his ottas and chabutras. Even so, the matter of settling land covered. by ottas and chabutras on the expropriators was being considered by Government. On May 16, 1952, a press note was issued by the Directorate of Information and Publicity, Government, of Madhya Pradesh the material portion of which runs thus: "The Government consider that the option 431 given to expropriators to remove the material etc., might cause hardship to them in such cases. Government have, therefore, decided on the following lines of action in such matters: (i) where the ottas and chabutras were, constructed in brick and stone, they should be allowed to remain with the exproprietors and the land thereunder should be settled with them under section 5(a) of the Madhya Pradesh Abolition of Proprietary Rights Act, 1950 (1 of 1951) on terms and conditions determined by the Government; and (ii) where the ottas and chabutras are in mud, the land Under them should be deemed to have vested in the State Government. But after this press note was issued the Government, apparently on the advice of its law officers, issued instructions to the Deputy Commissioners on June 22, 1954, to give one month 's notice all ex proprietors to remove the materials, clear the site of ottas and chabutras other than those on which there were sheds. In pursuance of this, a notice was issued to the respondent on July 13, 1954. Feeling aggrieved by this, the respondent preferred a petition under article 226 of the Constitution before the High Court of Nagpur for issue of a writ of mandamus or certiorari or other appropriate to writ to quash the orders passed by the Commpensation Officer and the appellate authority as well as the order of the State Government of Madhya Pradesh dated June 22, 1954, and the notice issued in pursuance thereto on July 13, 1954. The High Court allowed the petition and set aside the impugned orders and directed the State Government to settle the on tire area of Khasra No. 61 /1 of Bhivapur 432 with the respondent on such terms and conditions as may be determined by it. It may be mentioned that the entire area of Khasra No. 61/1 is 12.85 acres or so. The State of Madhya Pradesh sought a certificate from the High Court under article 133(1)(c) of the Constitution. But the certificate was not granted. Thereupon a special leave petition was made before this Court under article 136 of the Constitution. Leave was granted by this Court by its order dated March 18, 1957. That is how the appeal has come up before us. It may be mentioned that the High Court granted the petition of the respondent on the view that ottas and chabutras etc. , are buildings within the meaning of section 5(a) of the Act and that consequently the State Government was bound to settle the land covered by them with ex proprietors along with land appurtenant to those structures. In the application made before the High Court for grant of certificate, the following three grounds were raised: "5. For that the total market area as claimed by the non applicant being only 2.85 the entire abadi area of 12.85 acres in Khasra No. 61/1 could not be granted and settled with the ex proprietor. For that the ottas and chabutras in the bazar area could not be held to be buildings contemplated under section 5(1)(a) read with section 4 (1) (a) of the Act 1 of 1941 and could not be settled with the ex proprietor under the law. For that the buildings envisaged in the provisions 5(1)(a) are those buildings which are situated in the abadi and not those stand ing in bazars even though the bazar may also be located in the abadi and that ottas and chabutras etc., in the bazar being an integral part thereof are clearly different from those other 433 buildings used for agricultural or domestic purposes. " It would, however, appear from para. 2 of the order of the High Court refusing certificate that the learned Advocate General for "the State did not challenge the correctness of the meaning given by the High Court to the word "buildings" in section 5(a) of the Act. But the contention he pressed was that the words "ottas and chabutras" must be restricted to structures standing on the abadi of the village excluding that on which bazar was held, which under section 4(1)(a) vests in the State. Before us however, Mr. Bindra reiterated the contention which was originally pressed in the High Court that ottas and chabutras cannot be regarded as buildings within the meaning of that word in section 5(a) of the Act. According to him the concession made by the learned Advocate General was on a question of law and the State is entitled to withdraw that concession. In our opinion the question whether ottas and chabutras fall within the term " 'buildings" is not purely one of law and the State is not entitled to withdraw that concession. It would also appear from grounds 5 and 6 in the special leave petition that what was really sought to be urged before this Court was the contention actually pressed by the learned Advocate General in support of the application for grant of certificate. All the same we allowed Mr. Bindra to urge the contention that ottas and chabutras are not included in the term "buildings" in section 5(a) of the Act. The relevant portion of section 5(a) of the Act reads thus: "Subject to the provisions in sections 47 and 63 all open enclosures used for agricultural of domestic purposes and in continuous possession for twelve years immediately before 1948 49; all open house sites purchased for 434 consideration; all buildings;. . . within the limits of a village site belonging to or held by the out going proprietor or any other person, shall continue to belong to or be held by such proprietor or other person as the case may be; and the land thereof with the areas appurtenant thereto shall be settled with him by the State Government on such terms and conditions as it may determine;" "Village site" means the abadi in an estate or a mahal. Section 5(a) is an exception to section 4(1)(a) of the Act. No. doubt, section 4(1)(a) provides for the vesting in the State of the land on which bazar is held. But reading that section along with section 5(a) it is clear that where any buildings belonging to the proprietor exist on any portion of the abadi land that land, together with the land appurtenant to those buildings, bad to be settled with the ex proprietor. Land on which the bazar is held is part of the village abadi land and, therefore, all buildings standing on such land would fall within section 5(a) of the Act and would have to be settled with the ex proprietor. The only question, therefore, is whether ottas and chabutras can be regarded as buildings. A perusal of that provision would show that where the ex proprietor has spent money on constructing something within the limits of the village sites, that thing had to be settled with him. The word "buildings" should, therefore, be given its literal meaning as something which is built. Mr. Bindra 's contention, however, is that for a structure to be regarded as a building, it should have walls and a roof and in support of this contention lie relied upon the decision in Moir vs Williams (1) In that case Lord Esher has observed that the term building generally means all (1) 435 enclosures of brick and stone covered by a roof. But he has also made it clear that the meaning to be given to that word must depend upon the enactment in which the word is used and the context in which it is used. There, what was being considered was the provisions of the Metropolitan Buildings Act, 1855 (10 & 19 Vict. c. 122) which dealt with residential houses. He also relied upon the decision in Morrison vs Commissioners of Inland Revenne (1). That was a case under the Finance (10 Miw. 7 c. 8). The observations on which he relied are as follows: " It is quite clear that the expression 'buildings ' does not mean everything that can by any means be described as built: it means buildings in a more narrow sense than struct ures, because there are other structures of a limited class which under the terms of the sub section may also be taken into considera tion. " Far from these observations helping him they clearly show that the natural or ordinary meaning to be given to the word "Buildings", is something which has been built. That meaning would be modified if the provisions of law justify giving some other meaning. Finally he relied upon the decision in Samuel Small vs Parkway Auto Supplies (2). The observations relied on by him are as follows: "The word 'building ' in its ordinary sense denotes 'a structure or edifice including a. space within its walls and usually covered with a roof, such as a house, a church, a shop, a barn or a shed. ' The word 'building ' cannot be held to include every Species of erection on land, such as fences, gates or other like structures. Taken (1) (1915) I K. B. 176 at 722. (2) 49 A.I.R. 1361 at 1363. 436 in its broadest sense, it can mean only an erection intended for use and occupation as a habitation or for some purpose of trade, manufacture, ornament or use, constituting a fabric or edifice, such as a house, a store, a church, a shed. . These observations must Be considered in the context of the Act which was being construed and in the context in which they were made. There the Court bad to consider whether erection of gasoline pumps and construction of under ground gasoline tanks and pits with concrete sides sunken in the ground are within a restrictive covenant that no building of any kind shall be erected or maintained within a certain distance of a street. In the particular context buildings had, according to the Court, to be given its popular meaning. That case, therefore, does not assist the appellants. In our opinion the High Court was quite right in holding that even uncovered ottas and chabutras fall within the term "building" as used in section 5(a) of the Act and, therefore, along with the land appurtenant to them they must be settled with the respondent. Mr. Bindra pointed out that the High Court was in error in asking the Government to settle the whole of Khasra No.61/1 on the respondent because whereas its area is 12.85 acres, the land covered by the structures, including the appurtenant land, does not measure more than 2.85 acres. Mr. Purushottam Trikamdas, learned counsel for the respondent readily conceded this fact and said that the High Court has committed an error through an oversight and that all that the respondent wants is 2.85 acres of land and nothing more. Mr. Bindra then said that it would not be proper to give a direction to the Government to settle any particular area of the land and it should be left to the revenue authorities 437 to determine the precise area covered by the structures and the passages separating these various structures. We agree with him. It would be sufficient to direct the Government to settle with the respondent the whole of the land covered by the structures as well as land appurtenant to those structures from out of Khasra No. 61/1. What the area of that land would be is a matter to be determined during the settlement proceedings. With this modification we dismiss the appeal with costs. Appeal dismissed.

The proprietary interest of the respondent in his village was abolished by the M. P. Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act, 1950, and all rights, title and interest were vested in the State by section 4. Section 5(a) of the Act provide that where any "buildings" belonging to the proprietor exist on any portion of the abadi land, that land together with the land appurtenant to those buildings shall be settled with the ex proprietor. Land covered by ottas and chabutras on which sheds had been constructed was settled with the respondent but not the land on which open uncovered ottas and chabutras existed. Held, that the respondent was entitled under section 5(a) of the Act to have the land on which uncovered ottas an chabutras existed, as also the land appurtenant thereto, settled with him. Uncovered ottas and chabutras fell within the term "buildings" as used in section 5(a). The provisions showed that where the proprietor had spent money on constructing something on an abadi site within the limits of the village sites, that site had to be settled with him. Accordingly the word "buildings" has to be given its literal meaning as something which is built. Moir vs Williams, , Morrison vs Commissioners of Inland Revenue, and Samuel Small vs Parkway Auto Supplies, , distinguished.

Appeal No. 49 of 1958. Appeal from the judgment and decree dated April 17, 1954, of the former Nagpur High Court in F. As. Nos. 95 and 103 and 1946. section P. Sinha, Yogeshwar Prasad and M. 1. Khowaja, for the appellants. Achhru Ram and Ganpat Rai, for respondents Nos. 1 (a) to 1 (d), (2) and 4. 1962. April 10. The Judgment of the Court was delivered by MUDHOLKAR, J. This is an appeal by certificate from the decree of the High Court of Nagpur dismissing the appellants ' suit for setting aside sale of two villages mauza Amaldihi and mouza Gondhami situate in Mungali tehsil, district Bilaspur. It is common ground that the two villages, along with several others, were the Joint family property of the appellant, and their father the third 650 defendant, Gorelal. On April 8, 1944, Gorelal, acting for himself and as guardian of his minor son Balramdas, appellant No. 2 and Radhakrishnadas, appellant No. 1 describing himself as a major executed a sale deed in favour of two persons, Pandit Ramlal, son of Motiram, defendant No. 2 and Kaluram the first defendant for a consideration of Rs. 50,000/ . It was stated in the sale deed that the executants were transferring full 16 annas interest in the village Amaldihi and Gondkhami ', 'together with sir and khudkast lands, grass, kothar padia gochar rivers, brooks, wells, tanks, bandkies, orchards and gardens and houses and the like, as well &is the cultivated and the uncultivated lands in the village with all the rights and privileges. " The entire sixteen annas share in mauza Gondkhami and twelve annas share in mauza Amaldihi was sold to Kaluram for Rs. 37,500/ and the remaining four annas share of Amaldihi to Pandit Ramlal for Rs. 12,500/ . Out of the consideration of Rs. 50,000/ a sum of Rs. 30,491/8/ was kept with Kalaram for satisfying a mortgage decree obtained against the family by one Gayaram in respect of these two village; as ' well as two other villages. Similarly a further amount of Rs. 2,000/ was allowed to be retained by Kaluram for paying the land revenue due in respect of these villages. The balance of the amount was received in cash. It was further stated in the sale deed that this amount was required for performing the marriages of the appellant No. 1 Radhakrishnadas and Gorelal 's daughter Ramjibai, who were both stated to be majors. The possession of the property sold was handed over to the defendant 1 and 2 who are respondents 1 and 2 to the appeal. On May 5, 1945, the two appellants instituted a suit out of which this appeal arises. It was contended in the suit that since the income of the 651 family was Rs. 7,000/. per year, considerable savings could be made out of it after defraying the expenses of the family. There was, therefore, no necessity for executing the sale deed. It was further stated that the consideration for the sale was extremely low, bearing in mind the value of the two villages. It was further stated that the appellant No. I who was one of the executants of the sale deed was in fact a minor on the date of its execution and, therefore, the document is void in so far as his interest in the property sold is concerned. It was then stated that the sale deed did not purport to transfer the cultivating rights in the sir lands in the two villages and, therefore, in any case only the proprietary interest in the sir land could pass to the respondents 1 and 2 under the sale. The trial court negatived the appellants ' contention about the want of legal necessity for the sale and found as a fact that Rs. 10,000 were required for the marriages of the appellant No. 1 and his sister Ramjibai, Rs;. 7, 508 8 0 for paying various creditors, Rs. 1,655 2 0 for the payment of land revenue and the balance to satisfy the mortgage decree of Gayaram Sao. It, however, found that the appellant No. 1 was a minor at the date of the execution of the sale deed and that its execution by him was void and ineffective. But it held that he is bound by the sale deed as his father Gorelal, who is respondent No. 3 to the appeal, is to be deemed to have executed the sale deed as Manager of the family. It, however, upon a construction of the sale deed, came to the conclusion that cultivating rights in sir were not transferred thereunder and, therefore, passed a decree in favour of the appellants for possession of the sir lands in the suit as these lands had become their ex proprietary occupancy lands by virtue of section 49 (1) of the C. P. Tenancy Act, 1920 (C. P. 1 of 1920). The appellants preferred an appeal before the High Court against that part of the decree which dismissed their claim 652 for the possession of their share in the villages. The respondents 1 and 2 preferred a cross appeal. These appeals were heard together and while the appellants ' appeal was dismissed, that of the respondents was allowed. Before us Mr. section P. Sinha accepts the position that Rs. 45,000/. out of the consideration of Rs. 50,000/ was in fact for debts binding on the family, but contends that even so it cannot be said that there was legal necessity for the sale. His argument is that a sum of Rs. 5,000 or so for which, according to him, legal necessity had not been established was not a negligible part of the consideration of Rs. 50,000/ . This argument is based upon a misapprehension of the true legal position. It is well established by the decisions of the Courts in India and the Privy Council that what the alience is required to establish is legal necessity for the transaction and that it is not necessary for him to show that every bit of the consideration which he advanced was actually applied for meeting family necessity. In this connection we may refer to two decisions of the Privy Council. One is Sri Krishan Das vs Nathu Ram (1). In that case the considera tion for the alienation was Rs. 35,000/ . The alience was able to prove that there was legal necessity only to the extent of Rs. 3,000/ and not for the balance. The High Court hold that the alienation could be set aside upon the plaintiff 's paying Rs. 3,000/ to the alience. But the Privy Council reversed the decision of the High Court observing that the High Court had completely misapprehended the principle of law applicable to a case of this kind. What the alience has to establish is the necessity for the transaction. If he establishes that then he cannot be expected to establish how the consideration furnished by him was applied by the alienor. The reason for this, as has been stated by the Privy Council in some other cases, is that the (1) I L.R. 49 All. 149 (P.C.) 653 alience can rarely have the means of controlling and directing the actual application of the money paid or advanced by him unless he enters into the management himself. This decision was followed by the Privy Council in Niamat Rai vs Din Dayal where at p. 602 and 693 it has observed : "It appears from the judgment of the learned Judges of the High Court that if they had been satisfied that the whole of the Rs. 38, 400 paid out of the sale proceeds was paid in discharge of debts incurred before the negotiation of sale, they would have been of opinion that the sale ought to have been upheld. With this conclusion their Lordships agree, but they are of opinion that undue importance was attached by the learned Judges to the question whether some of the payments where made in discharge of debts incurred i n the interval between the negotiation of the sale and the execution of the sale deed. Even if there had been no joint family business, proof that the property had been sold for Rs. 43,500 to satisfy pre existing debts to the amount of Rs. 38,000 would have been enough to support the sale without showing how the balance had been applied, as held by their Lordships in the recent case of Krishan Das vs Arathu Ram. (2) " Both these decisions stale the correct legal position, Mr. Sinha 's argument must, therefore, be rejected. His next argument is that the appellant No. 1 Radhakrishnadas having been found to be a minor on the date of the transaction, that transaction cannot bind his interests. If the appellants ' father, Gorelal, who was admittedly the manager of the family, had not joined in the sale deed, the appellant No. 1 could have contended with profit that the transaction does not bind him. As it is, his joining (1) 1. L. R (2) 1 L. R. 49. 149 (P.C.) 654 as an executant in the sale deed does not make any difference. The fact that sale deed had been executed also by his father who was the manager of the family makes the transaction binding upon him just as it is admittedly binding upon his brother, the second appellant, who was then a minor. Mr. Sinha, however, contended that the fact that the appellant No. I was required by the alience, respondents 1 and 2. to join in the transaction clearly shows that Gurelal in executing the sale deed did not and could not act for him. We cannot accept the argument. For ascertaining whether in a particular transaction the manager purports to act on behalf of the family or in his individual capacity one has to see the nature of the transaction and the purpose for which the transaction has been entered into. A manager does not cease to be a manager merely because in the tran saction entered into by him a junior member of the family, who was a major, or believed to be a major also joined. It is not unusual for alienees to require major members of the family to join in transactions entered into by managers for ensuring that later on no objections to the transaction are raised by such persons. Further, such circumstance is relevant for being considered by the court while determining the existence of legal necessity for such a transaction. But that is all. Here we find that Gorelal acted not merely for himself but also expressly for his minor son appellant No. 2. The money was required partly for paying antecedent debts, partly for paying public demands, partly for paying other creditors and partly for performing the marriages of appellant No. 1 and the latter 's sister Ramjibai. It is thus clear that Rs. 45,000/ out of the consideration of Rs. 50,000/ were required for the purposes of the family. Even where such a transaction has been entered into solely by a manager it would be deemed to be on behalf of the family and binding on it. The position is not worsened by the fact that 655 a junior member joins in the transaction and certainly not so when the joining in by such junior member proves abortive by reason if the fact that member has no capacity to enter into the transaction because of his minority. In this connection we may make a mention of three decisions Gharib Ullah vs Khalak Singh (1); Kanti Chunder Goswami vs Bisheswar Goswami (2); Bijrai Nopani vs Pura Sundary Dasee (3) each of which proceeds upon the principle that if one of the executants to a sale deed or mortgage deed has the capacity to bind the whole estate, the transaction will bind the interest of all persons who have interest in that estate. We have, therefore, no doubt that the second contention of Mr. Sinha is equally devoid of substance. Lastly, Mr. Sinha contended that the High Court was in error in reversing the decree of the trail court in so far as the sir land is concerned. He has laid particular stress on the fact that the sale deed at no place says in express terms that cultivating rights in sir land have also been trans ferred and said that the absence of such a recital in the sale deed clearly entitles the alienor to retain possession of the sir land, under the exception set out in cl. (a) of section 49 (1) of the C. P. Tenancy Act. The relevant portion of section 49(1) of the Act runs thus: "A proprietor who loses under a transfer his right to occupy his sir land as a proprietor, shall, at the date of such loss, become an occupancy tenant of such sir land except in the following cases, (a) when a transfer of such sir land is made (1) I.L.R. 25 All. 407,415 (P.C.) (2) F.B. (3) 656 by him expressly agreeing to transfer his right to cultivate such sir land. . " What this provision no doubt requires is an express agreement between the transferor and the transferee concerning the transfer of the cultivating rights in sir land. We have already quoted the Precise language used in the document describing the interest which has been transferred under the sale deed. The recital shows that the executant of the sale deed not only transferred sir and khudkast lands, cultivated and uncultivated lands, but transferred these properties along with "all rights and privileges". If the intention was not to transfer the cul tivating rights in sir lands the concluding words were not necessary. Each interest which has been specified in the recital is governed by the concluding words ,all the rights and privileged contained in that recital. In the absence of these words what would have passed under the sale deed, in so far as the sir land is concerned, would have been only the proprietary interest in that land. The question is, what is the effect of the addition of those words ? According to Mr. Sinha they only emphasise the fact that the entire proprietary in the sir land is transferred. If we accept the interpretation then those words would be rendered otiose. That would not be the right way of interpreting a formal document. To look at it in another way, where a person transfers sir lands together with "all rights and privileges" therein he transfers everything that he has in that land. which Must necessarily include the cultivating right. It would follow from this that where there is a transfer of this kind no kind of interest in sir land is left in that person thereafter. Mr. Sinha further said that when the statute requires that cultivating rights in sir land must be expressly transferred it makes it obligatory on the parties to say clearly in the documents that cultivating rights in the sir land have also been transferred. We see no reason for placing 657 such an interpretation on the provisions of cl. (a) of section 49(1) of the C. P. Tenancy Act. When it says that the transfer of cultivating rights in sir land has to be made expressly all that it means is that a transfer by implication will not be enough. Finally Mr. Sinha 's point is that the words "all the rights and privileges" in the recital do not govern the interests specified in the clause just preceding these words but they govern following words "sixteen anna in muza Gondkhami and twelve anna in mauza Amaldihi to Seth Kaluram etc. " Apart from such a construction rendering the expression meaningless it would be ungrammatical to read the expression as applying to "sixteen anna in mauza Gondkhami and twelve anna in mauza Amaldihi etc. " Therefore, there is no substance in the appeal and accordingly we dismiss it with costs. Appeal dismissed.

R and his father executed a sale for Rs. 50,000/ transfer. ring 16 annas interest in two villages belonging to the joint family ,together with sir and khudkashat lands. . as well as the cultivated and the uncultivated lands in the village with all the rights and privileges". Subsequently. R filed a suit to set aside the sale on the grounds that actually he was a minor when he executed the sale deed and that the legal necessity was only for Rs. 45,000/ . He further contended that the cultivatory rights in the sir lands were not transferred and claimed possession over them. Held, that the alienation was for legal necessity and was valid and binding, The alience was only required to establish legal necessity for the transaction and it was not necessary for him to show that every bit of the consideration was applied for meeting family necessity. The transaction being for legal necessity the father was competent to execute the sale deed binding on the entire family and the joining of R, even though he was a minor, did not affect its validity or binding character. 649 Sri Krishan Das vs Nathu Ram, 1. L. R. 49 All. 149 (P. C.) and Naimat Rai vs Din Dayal, 1. L. R. relied on. Gharib Ullah vs Khalak Singh, I. L. R. 25 All. 407 (C.) Kanti Chunder Goswami vs Bisheswar Goswami, 25 Cal.585 Biraj Nopani Pura Sundary Dasee, C.), referred to. Held, further, that cultivating rights in the sir lands bad also been expressly transferred to the vendees by the sale deed. The provisions of section 49 (1) of the C. P. Tenancy Act, 1920, that there must be an express agreement between the transferor and the transferee concerning the transfer of the cultivating rights in sir land are satisfied where the sale deed not only transferred sir and Khudkashat lands, cultivated and uncultivated lands but transferred these properties along with "all rights and privileges", since they would include cultivating rights in sir land.

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

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