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AIR 2008 SUPREME COURT 399 "Lucknow Development Authority v.

Krishna Gopal
Lahori"
(From : Allahabad)
Coram : 2 Dr. A. PASAYAT AND LOKESHWAR SINGH PANTA, JJ.
Civil Appeal No. 5112 of 2007 (arising out of SLP (C) No. 12446 of 2005), D/- 2 -11
-2007.
Lucknow Development Authority v. Krishna Gopal Lahori and Ors. @page-SC400
(A) Land Acquisition Act (1 of 1894), S.23 - ACQUISITION OF LAND - Acquisition
compensation - Large area acquired - Rates fixed for small plots - No absolute rule that
they be kept out of consideration.
Where large area is the subject-matter of acquisition, rate at which small plots are sold
cannot be said to be a safe criteria. It cannot, however, be laid down as an absolute
proposition that in such cases, the rates fixed for the small plots cannot be the basis for
fixation of the rate. For example, where there is no other material it may in appropriate
cases be open to the adjudicating Court to make comparison of the prices paid for small
plots of land. However, in such cases necessary deductions/ adjustments have to be made
while determining the prices. (Paras 15, 16)
(B) Land Acquisition Act (1 of 1894), S.23 - ACQUISITION OF LAND - SALE -
Acquisition compensation - Determination - Comparable sale - Essentials for
constituting.
For sale to be considered as comparable sale it is essential that the sale is within a
reasonable time of the date of notification u/S. 4(1); it should be a bona fide transaction;
it should be of the land acquired or of the land adjacent to the land acquired ; and it
should possess similar advantages. (Para 18)
(C) Land Acquisition Act (1 of 1894), S.23 - ACQUISITION OF LAND - Acquisition
compensation - Deductions towards development charges - For agricultural land or
undeveloped land which has potential value for housing or commercial purposes -
Normally the deduction is 1/3rd amount of compensation - It may vary depending on its
nature, location, expenditure involved etc. - Fact that an area is developed or adjacent to a
developed area - Does not ipso facto make every land situated in area also developed,
particularly, when vast tracts are acquired. (Para 22)
Cases Referred : Chronological Paras
2004 AIR SCW 75 : AIR 2004 SC 1185 (Ref.) (Pt.C) 24
2004 AIR SCW 2089 : AIR 2004 SC 2006 : 2004 All LJ 1438 (Ref.) (Pt. C) 24
(2004) 12 SCC 425 (Ref.) (Pt. C) 24
2003 AIR SCW 1491 : AIR 2003 SC 1987 (Ref.) (Pt. B) 20
2002 AIR SCW 4644 : AIR 2003 SC 202 (Ref.) (Pt. C) 23
AIR 1989 SC 1222 17
AIR 1984 SC 892 15
AIR 1977 SC 1560 15
AIR 1971 SC 2015 15
AIR 1959 SC 429 (Rel. on) (Pt. B) 19
AIR 1939 PC 98 17
Umesh Chandra Sr. Advocate, Krishna Chandra, S. A. Kashif and Shakil Ahmed Syed,
for Appellant; Jayant Bhushan Sr. Advocate Ashwini Garg and Vijay Kumar, for
Respondents.
* F. A. No. 54 of 1998, D/- 9-2-2005 (All).
Judgement
1. Dr. ARIJIT PASAYAT, J.:-Leave granted.
2. Challenge in this appeal is to the judgment of a Division Bench of the Allahabad High
Court, Lucknow Bench dismissing the appeal filed by the appellant under Section 54 of
the Land Acquisition Act, 1894 (in short the 'Act') read with Section 96 of the Code of
Civil Procedure, 1908 (in short 'CPC').
3. In the First Appeal challenge was to the award dated 18.2.1998 passed by the Presiding
Officer, Nagar Mahapalika Tribunal, Lucknow in a reference under Section 18 of the Act
in Land Case No.746 of 1991 titled Krishna Gopal Lahoti v. State of U.P.
4. The factual background in a nutshell is as follows:
A large area of land measuring 194 bigha 19 biswa 14 biswansi and 14 kachwansi
situated in village Purania and Mahibullapur was sought to be acquired by appellant-
Lucknow Development Authority under the Housing and Development Scheme known as
"Timber Nagar Avasiya Yojana". Khasra Plot No. 379 measuring 8 bigha, and Khasra
Plot No. 394 measuring 2 bigha, 8 biswa 15 biswansi situated at village Mahibullapur and
belonging to the claimants Krishna Gopal Lahoti, Sharad Kumar Lahoti, Sunil Kumar
Lahoti and Sudhir Kumar Lahoti were also acquired under the said scheme. The relevant
notification under Section 4 was issued on 26.3.1986. The notification under Section 6 of
the Act was published on 28.5.1986. The possession of the acquired land was taken on
17.12.1986 and Award under Section 11 of the Act was made on 27.5.1988 by the Special
Land Acquisition Officer. The Special Land Acquisition Officer in his Award under
Section 11 of the Act determined the market value of the land in question at the rate of
Rs. 2.20 per sq. ft.
@page-SC401
5. Aggrieved by the aforesaid Award, reference under Section 18 was preferred by the
land owners, inter alia, stating that adjoining to the land in question, there is Lucknow-
Sitapur Highway and nearby the acquired land there are number of colonies such as
Aliganj Colony, Kapurthala Complex, P and T Colony, Arif Complex, Public Service
Commission and Office of Geological Survey of India.
6. According to the landowners, the land in question has great potential value and the
market value as determined by the Special Land Acquisition Officer is quite inadequate.
The market value of the land at the rate of Rs. 60/- per sq.ft. was claimed by the
respondents besides statutory benefit under Act 68 of 1984.
7. The Lucknow Development Authority and the State of U.P. filed written statements
separately. It was stated that the compensation as determined and awarded by the Special
Land Acquisition Officer is quite adequate and the claimants are not entitled to the
benefits of the provisions of Act 68 of 1984. It was stated that claim petition is barred by
time. It is also barred by the provisions of the Urban Land Ceiling Act, 1976 (in short
'ULC' Act) and by the provisions of Section 31 of the Act.
8. Both the parties led oral and documentary evidence.
9. The learned Tribunal could not find any substance in the pleas raised by the appellants
regarding claim being barred under various heads as alleged in the written statements and
all the issues were decided in negative against the appellant. The Tribunal further found
that the claimants are entitled to the benefit of provisions of Act of 68 of 1984 and on the
basis of the evidence on record, the Tribunal determined the market value of the land at
Rs. 6/- per sq. ft. and accordingly compensation was awarded by the impugned Award.
10. Against the Award, the First Appeal was filed before the High Court. Primarily, it was
contended before the High Court that the Tribunal had not properly evaluated the
evidence on record and wrongly placed reliance on a sale deed relating to a small piece of
land. It was also submitted that without any proper appreciation of materials on record
the compensation was enhanced.
11. Stand of the respondents before the High Court was that there was no illegality in the
Award passed by the reference court. It was submitted that the land was situated near
densely populated area having great potential value and the appellate authority is selling
the same land at the rate of Rs. 300/- per sq. ft. The reference court on the basis of oral
and documentary evidence has awarded compensation at the rate of Rs. 6/- per sq. ft.
along with other benefits as provided under the Act. The High Court found that the
claimants had filed number of sale deeds of varying rates ranging between Rs.10/- per sq.
ft. to Rs. 5/- per sq. ft. but the sale deed relating to the Plot No.166 situated at
Mahibullahpur was relied upon by the Tribunal and the reasons for enhancing the
compensation were assigned which according to the High Court did not call for any
interference. The High Court did not find any substance in the plea of the appellant that
the sale deed (Ex.C-38) was unduly relied upon by the Tribunal. It was pointed out that
the sale deed is related to a very small piece of land as against the large area of more than
10 bighas involved in the present case. The High Court referred to certain decisions of
this Court to hold that while determining the market value of the land, the potentiality of
the land is a very material consideration and several factors like location of the land, its
surroundings, available facilities thereon in the vicinity, nature of the land have to be
taken into account. The High Court also found that there was no similarity between the
land which was the subject matter of dispute in Land Acquisition Case No. 204 of 1992
where the rate fixed was Rs.1.85 per sq. ft.
12. The High Court further found that two sale deeds (Ga 26 and Ga 27) reflected that the
rate was Rs. 3/- per sq. ft. However, instances were referred to in holding that the market
value is much higher. After granting deduction of 25% on account of expenses to be
incurred towards plotting and development charges, the rate was fixed at Rs. 6/- per sq. ft.
Therefore, the High Court did not find any substance in the stand that the deduction
should be at least 40% and not 25% as done. Accordingly, appeal as noted above was
dismissed.
13. In support of the appeal, learned counsel for the appellant reiterated the stand taken
before the High Court.
14. In response, learned counsel for the respondents submitted that three sale deeds
namely, C-38, 39 and 40 clearly show that
@page-SC402
rate is much higher. It was pointed out that this Court has depending on the facts of the
case, allowed deductions ranging between 20% to 33%. That cannot be a hard and fast
rule and in fact it would depend upon various factors.
15. Where large area is the subject-matter of acquisition, rate at which small plots are
sold cannot be said to be a safe criteria. Reference in this context may be made to three
decisions of this Court in The Collector of Lakhimpur v. Bhuban Chandra Dutta (AIR
1971 SC 2015); Prithvi Raj Taneja (dead) by LRs. v. The State of Madhya Pradesh and
Anr. (AIR 1977 SC 1560) and Smt. Kausalya Devi Bogra and Ors. etc. v. Land
Acquisition Officer, Aurangabad and Anr. (AIR 1984 SC 892).
16. It cannot, however, be laid down as an absolute proposition that the rates fixed for the
small plots cannot be the basis for fixation of the rate. For example, where there is no
other material it may in appropriate cases be open to the adjudicating Court to make
comparison of the prices paid for small plots of land. However, in such cases necessary
deductions/adjustments have to be made while determining the prices.
17

. In the case of Suresh Kumar v. Town Improvement Trust, Bhopal (1989 (1) SVLR (C)
399) in a case under the Madhya Pradesh Town Improvement Trust Act, 1960 this Court
held that the rates paid for small parcels of land do not provide a useful guide for
determining the market value of the land acquired. While determining the market value of
the land acquired it has to be correctly determined and paid so that there is neither unjust
enrichment on the part of the acquirer nor undue deprivation on the part of the owner. It is
an accepted principle as laid down in the case of Vyricherla Narayana Gajapatiraju v.
Revenue Divisional Officer, Vizagapatam (AIR 1939 PC 98) that the compensation must
be determined by reference to the price which a willing vendor might reasonably expect
to receive from the willing purchaser. While considering the market value, disinclination
of the vendor to part with his land and the urgent necessity of the purchaser to buy it must
alike be disregarded, neither must be considered as acting under any compulsion. The
value of the land is not to be estimated as its value to the purchaser. But similarly this
does not mean that the fact that some particular purchaser might desire the land more
than others is to be disregarded. The wish of a particular purchaser, though not his
compulsion may always be taken into consideration for what it is worth. Section 23 of the
Act enumerates the matters to be considered in determining compensation. The first
criterion to be taken into consideration is the market value of the land on the date of the
publication of the notification under Section 4(1). Similarly, Section 24 of the Act
enumerates the matters which the Court shall not take into consideration in determining
the compensation. A safeguard is provided in Section 25 of the Act that the amount of
compensation to be awarded by the Court shall not be less than the amount awarded by
the Collector under Section 11. Value of the potentiality is to be determined on such
materials as are available and without indulgence in any fits of imagination.
Impracticability of determining the potential value is writ large in almost all cases. There
is bound to be some amount of guess work involved while determining the potentiality.
AIR 1989 SC 1222

18. It can be broadly stated that the element of speculation is reduced to minimum if the
underlying principles of fixation of market value with reference to comparable sales are
made:
(i) when sale is within a reasonable time of the date of notification under Section4(1);
(ii) it should be a bona fide transaction;
(iii) it should be of the land acquired or of the land adjacent to the land acquired; and
(iv) it should possess similar advantages.
19. It is only when these factors are present, it can merit a consideration as a comparable
case (See The Special Land Acquisition Officer, Bangalore v. T. Adinarayan Setty (AIR
1959 SC 429).
20

. These aspects have been highlighted in Ravinder Narain and Anr. v. Union of India
(2003 (4) SCC 481). 2003 AIR SCW 1491

21. The deduction to be made towards development charges cannot be proved in any
strait-jacket formula. It would depend upon the facts of each case.
22. It is well settled that in respect of agricultural land or undeveloped land which has
potential value for housing or commercial purposes, normally 1/3rd amount of
compensation has to be deducted out of the amount of compensation payable on the
@page-SC403
acquired land subject to certain variations depending on its nature, location, extent of
expenditure involved for development and the area required for roads and other civic
amenities to develop the land so as to make the plots for residential or commercial
purposes. A land may be plain or uneven, the soil of the land may be soft or hard bearing
on the foundation for the purpose of making construction; may be the land is situated in
the midst of a developed area all around but that land may have a hillock or may be low-
lying or may be having deep ditches. So the amount of expenses that may be incurred in
developing the area also varies. A claimant who claims that his land is fully developed
and nothing more is required to be done for developmental purposes, must show on the
basis of evidence that it is such a land and it is so located. In the absence of such
evidence, merely saying that the area adjoining his land is a developed area, is not
enough particularly when the extent of the acquired land is large and even if a small
portion of the land is abutting the main road in the developed area, does not give the land
the character of a developed area. In 84 acres of land acquired even if one portion on one
side abuts the main road, the remaining large area where planned development is
required, needs laying of internal roads, drainage, sewer, water, electricity lines,
providing civil amenities etc. However, in cases of some land where there are certain
advantages by virtue of the developed area around, it may help in reducing the percentage
of cut to be applied, as the developmental charges required may be less on that account.
There may be various factual factors which may have to be taken into consideration while
applying the cut in payment of compensation towards developmental charges, may be in
some cases it is more than 1/3rd and in some cases less than 1/3rd. It must be
remembered that there is difference between a developed area and an area having
potential value, which is yet to be developed. The fact that an area is developed or
adjacent to a developed area will not ipso facto make every land situated in the area also
developed to be valued as a building site or plot, particularly, when vast tracts are
acquired, as in this case, for development purpose.
23

. The aforesaid aspects were highlighted in Kasturi and Ors. v. State of Haryana (2003 (1)
SCC 354). 2002 AIR SCW 4644
24

. A reference may also be made to what has been stated in Kiran Tandon v. Allahabad
Development Authority and Anr. (2004 (10) SCC 745); State of West Bengal v.
Kedarnath Rajgarhia Charitable Trust Estate (2004 (12) SCC 425) and V. Hanumantha
Reddy (dead) by LRs. v. Land Acquisition Officer and Mandal R. Officer (2003 (12)
SCC 642). 2004 AIR SCW 2089
2004 AIR SCW 75

25. Keeping in view the general principles and the factual scenario as evident from the
materials brought on record, we sustain the market value fixed (i.e. Rs.8/- sq.ft.) but
instead of 25% development charges one-third has to be deducted. The entitlements shall
be worked out on that basis.
26. The appeal is allowed to the aforesaid extent with no order as to costs.
Appeal allowed.
AIR 2008 SUPREME COURT 403 "Oriental Insurance Co. Ltd. v. Raj Kumari"
(From : Punjab and Haryana)*
Coram : 2 Dr. A. PASAYAT AND LOKESHWAR SINGH PANTA, JJ.
Civil Appeal No. 5209 of 2007 (arising out of SLP (C) No. 2511 of 2006),D/- 14 -11
-2007.
Oriental Insurance Co. Ltd. v. Smt. Raj Kumari and Ors.
(A) Constitution of India, Art.141 - PRECEDENT - Precedent - Principle on which
question before Court is decided - Constitutes precedent - Not every observations made
in judgment.
Every decision contains three basic postulates : (a) findings of material facts, direct and
inferential. An inferential finding of facts is the inference which the Judge draws from the
direct, or perceptible facts; (b) statements of the principles of law applicable to the legal
problems disclosed by the facts; and (c) judgment based on the combined effect of the
above. A decision is an authority for what it actually decides. What is of the essence in a
decision is its ratio and not every observation found therein nor what logically flows from
the various observations made in the judgment. The enunciation of the reason or principle
on which a question
@page-SC404
before a Court has been decided is alone binding as a precedent. Observations of courts
are neither to be read as Euclid's Theorems nor as provisions of the statute and that too
taken out of their context. (Paras 11, 12)
(B) Motor Vehicles Act (59 of 1988), S.147 - MOTOR VEHICLES - INSURANCE -
Liability of insurer - Limited to certain sum - Insured a transport company - No evidence
adduced to show that claimant would have difficulty in recovering sum awarded from
insured - Insurer cannot be directed to pay entire compensation and subsequently recover
excess paid from insured. (Para 16)
Cases Referred : Chronological Paras
2002 AIR SCW 259 : AIR 2002 SC 651 6
1998 AIR SCW 1327 : AIR 1998 SC 1433 7
1996 AIR SCW 4020 (Rel. on, Pnt A) 11
1995 AIR SCW 1142 : AIR 1995 SC 1113 7
AIR 1988 SC 719 7
(1972) 2 WLR 537 (Ref., Pnt A) 13
(1971) 1 WLR 1062 (Ref., Pnt A) 13
(1970) 2 All ER 294 (Ref., Pnt A) 13
AIR 1968 SC 647 (Ref. on, Pnt A) 11
1951 AC 737 : (1951) 2 All ER 1 (Ref. Pnt A) 12
1901 AC 495 (HL) (Ref.) 11
M. K. Dua and Kishore Rawat, for Appellant; Dinesh Chander Yadav and Dr. Kailash
Chand, for Respondents.
* F. A. F. O. No. 1029 of 1986, D/- 13-7-2005 (PandH).
Judgement
1. Dr. ARIJIT PASAYAT, J.:- Leave granted.
2. Challenge in this appeal is to the order passed by a learned Single Judge of the Punjab
and Haryana High Court. By the impugned judgment, the High Court held that though the
liability of the appellant (hereinafter referred to as the insurer) was limited to Rs. 50,000/-
yet it was to first pay the amount awarded to the claimants and recover amount in excess
of Rs. 50,000/- from the owner and driver of the offending vehicle.
2A. Factual position in a nutshell is as follows:
One Karan Singh, conductor of the bus No. DEP-3514 lost his life in an accident which
took place on 14.7.1984. The bus belonged to M/s. Mewat Transport Company Private
Limited (hereinafter referred to as the insured). The bus was driven by deceased Karan
Singh and it dashed in a tanker No. HRG-2852. The impact was so intense and severe
that several persons sitting in the bus died, while many others sustained injuries. The
widow, minor children and parents of aforesaid Karan Singh lodged claim petition
claiming compensation of Rs.1,40,000/-. The Tribunal took several claim petitions
together and in respect of the claim under consideration awarded compensation of Rs.
57,600/- along with 12% interest p.a. from the date of institution of the claim petition. It
was, however, held that liability of the insurer was limited to Rs. 50,000/-.
3. The claimants filed appeal before the Punjab and Haryana High Court. By the
impugned order the High Court enhanced claim of compensation to Rs.1,25,200/-. It was
held, as was done by the Tribunal, that the liability of the insurer was limited to Rs.
50,000/- in terms of the insurance policy. However, it was held that the entire amount was
to be paid by the insurer to the claimants and it was entitled to recover the amount in
excess of Rs. 50,000/- from the owner and the driver of the vehicle.
4. In support of the appeal, learned counsel for the appellant submitted that having held
that the liability of the insurance company was limited to Rs. 50,000/-, the High Court
was not justified in directing payment of the entire amount by it and to recover the
differential amount.
5. There is no appearance on behalf of the respondents.
6

. It would be appropriate to take a note of what was held by the Constitution Bench of
this Court in New India Assurance Co. Ltd. v. C.M. Jaya and Ors. (2002 (2) SCC 278). In
that case it was held, inter alia, as follows: 2002 AIR SCW 259, Para 13
"In the circumstances, we hold that the liability of the appellant-insurance company is
limited to Rs. 50,000/-, as held by the Tribunal. In the view we have taken, it is
unnecessary to go into the question relating to either maintainability of cross-objections
before the High Court against the appellant alone or as to the enhancement of
compensation when the owner and driver have not filed appeal against the impugned
judgment."
7. The questions that were considered by the Constitution Bench are as follows:

"The question involved in these appeals 1995 AIR SCW 1142


1998 AIR SCW 1327

@page-SC405
is whether in a case of insurance policy not taking any higher liability by accepting a
higher premium, in case of payment of compensation to a third party, the insurer would
be liable to the extent limited under Section 95(2) or the insurer would be liable to pay
the entire amount and he may ultimately recover from the insured. On this question, there
appears to be some apparent conflict in the two three-Judge Bench decision of this Court-
(1) New India Assurance Co. Ltd. v. Shanti Bai (1995 (2) SCC 539) and (2) Amrit Lal
Sood v. Kaushalya Devi Thapar (1998 (3) SCC 744).

2. In the latter decision, unfortunately the decision in New India Assurance case (supra)
has not been noticed though reference has been made to the decision of this Court in
National Insurance Co. Ltd. v. Jugal Kishore [(1988) 1 SCC 626], which was relied upon
in the earlier three-Judge Bench Judgment. In view of the apparent conflict in these two
three-Judge Bench decisions, we think it appropriate that the records of this case may be
placed before my Lord, the Chief Justice of India to constitute a larger Bench for
resolving the conflict. We accordingly so direct. The record may now be placed before
the Hon'ble the Chief Justice of India." AIR 1988 SC 719

8. It would be evident from the conclusions of this Court the liability of the insurance
company would in the instant case be limited to quantum which was to be indemnified in
terms of the policy. The Tribunal and the High Court have held accordingly.
9. In Oriental Insurance Co. Ltd. vs. Shakuntala Garg and Ors. (Civil Appeal No. 104 of
2000, disposed of on 10.1.2003), it was held as follows:
"Learned counsel for the appellant at this stage expressed an apprehension that by virtue
of the terms of the Award, the appellant may be required to pay the entire amount and
recover it from the owner. In the light of the modification of the impugned Award, such
question does not arise."
10. It is true that in certain cases this Court has, after looking into the fact situation,
directed the insurance company to make payment with liberty to recover the amount in
excess of the liability from the insured. Those decisions were given on the facts-situation
of the cases concerned.
11

. Reliance on the decision without looking into the factual background of the case before
it is clearly impermissible. A decision is a precedent on its own facts. Each case presents
its own features. It is not everything said by a Judge while giving a judgment that
constitutes a precedent. The only thing in a Judges decision binding a party is the
principle upon which the case is decided and for this reason it is important to analyse a
decision and isolate from it the ratio decidendi. According to the well-settled theory of
precedents, every decision contains three basic postulates (i)findings of material facts,
direct and inferential. An inferential finding of facts is the inference which the Judge
draws from the direct, or perceptible facts; (ii) statements of the principles of law
applicable to the legal problems disclosed by the facts; and (iii) judgment based on the
combined effect of the above. A decision is an authority for what it actually decides.
What is of the essence in a decision is its ratio and not every observation found therein
nor what logically flows from the various observations made in the judgment. The
enunciation of the reason or principle on which a question before a Court has been
decided is alone binding as a precedent. (See: State of Orissa v. Sudhansu Sekhar Misra
and Ors. (AIR 1968 SC 647) and Union of India and Ors. v. Dhanwanti Devi and Ors.
(1996 (6) SCC 44). A case is a precedent and binding for what it explicitly decides and no
more. The words used by Judges in their judgments are not to be read as if they are words
in Act of Parliament. In Quinn v. Leathem (1901) AC 495 (H.L.), Earl of Halsbury LC
observed that every judgment must be read as applicable to the particular facts proved or
assumed to be proved, since the generality of the expressions which are found there are
not intended to be exposition of the whole law but governed and qualified by the
particular facts of the case in which such expressions are found and a case is only an
authority for what it actually decides.1996 AIR SCW 4020

12. Courts should not place reliance on decisions without discussing as to how the factual
situation fits in with the fact-situation of the decision on which reliance is placed.
Observations of Courts are neither to be read as Euclid's Theorems nor as provisions of
the statute and that too taken out of their context. These observations must be read in the
context in which they appear to have been stated. Judgments of Courts
@page-SC406
are not to be construed as statutes. To interpret words, phrases and provisions of a statute,
it may become necessary for Judges to embark into lengthy discussions but the discussion
is meant to explain and not to define. Judges interpret statutes, they do not interpret
judgments. They interpret words of statutes; their words are not to be interpreted as
statutes. In London Graving Dock Co. Ltd. V. Horton (1951 AC 737 at p.761), Lord Mac
Dermot observed:
"The matter cannot, of course, be settled merely by treating the ipsissima verba of Willes,
J as though they were part of an Act of Parliament and applying the rules of interpretation
appropriate thereto. This is not to detract from the great weight to be given to the
language actually used by that most distinguished judge."
13. In Home Office v. Dorset Yacht Co. (1970 (2) All ER 294) Lord Reid said, "Lord
Atkins speech.....is not to be treated as if it was a statute definition. It will require
qualification in new circumstances." Megarry, J in (1971) 1 WLR 1062 observed: "One
must not, of course, construe even a reserved judgment of Russell L.J. as if it were an Act
of Parliament." And, in Herrington v. British Railways Board (1972 (2) WLR 537) Lord
Morris said:
"There is always peril in treating the words of a speech or judgment as though they are
words in a legislative enactment, and it is to be remembered that judicial utterances made
in the setting of the facts of a particular case."
14. Circumstantial flexibility, one additional or different fact may make a world of
difference between conclusions in two cases. Disposal of cases by blindly placing
reliance on a decision is not proper.
15. The following words of Lord Denning in the matter of applying precedents have
become locus classicus:
"Each case depends on its own facts and a close similarity between one case and another
is not enough because even a single significant detail may alter the entire aspect, in
deciding such cases, one should avoid the temptation to decide cases (as said by
Cordozo) by matching the colour of one case against the colour of another. To decide
therefore, on which side of the line a case falls, the broad resemblance to another case is
not at all decisive."
*** *** ***
"Precedent should be followed only so far as it marks the path of justice, but you must cut
the dead wood and trim off the side branches else you will find yourself lost in thickets
and branches. My plea is to keep the path to justice clear of obstructions which could
impede it."
16. In the instant case the insurer was a private limited company doing transport business.
There was no material placed before the High Court to show that the claimants would
have any difficulty in recovering the awarded amount from it. That being so, the High
Court's order is modified to the extent that the insurer shall pay an amount of Rs.50,000/-
with interest awarded to claimants. The balance has to be paid by the insured.
17. Another point urged before this Court in support of the appeal was that the rate of
interest is high. The liability of the insurance company is limited to Rs.50,000/? with
interest @ 9% p.a. from the date of the application. The rate is being fixed considering
the date of accident. The insured shall forthwith make payment of the balance amount
with interest to the claimants and in any event not later than 3 months from the date of
this order.
18. The appeal is allowed to the aforesaid extent with no order as to costs.
Order accordingly.
AIR 2008 SUPREME COURT 406 "Thankachan v. State of Kerala"
(From : 2005 Cri LJ 2385 (Kerala))
Coram : 2 Dr. A. PASAYAT AND P. SATHASIVAM, JJ.
Criminal Appeal No. 1535 of 2007 (arising out of SLP (Cri.) No. 3646 of 2006), D/- 13
-11 -2007.
Thankachan and Anr. v. State of Kerala.
(A) Penal Code (45 of 1860), S.300, Exception 1 and Exception 4 - MURDER - Murder
or culpable homicide not murder - Exception 4 deals with a case of prosecution not
covered by Exception 1 - Exceptions 1 and 4 are founded upon same principle namely
absence of premeditation - But, while in the case of Exception 1 there is total deprivation
of self-control, in case of Exception 4, there is only that heat of passion which clouds
men's sober reason and urges them to deeds which they would not otherwise do - There is
provocation
@page-SC407
in Exception 4 as in Exception 1; but injury done is not direct consequence of that
provocation.
2006 AIR SCW 1678, Rel. on. (Para 10)
(B) Penal Code (45 of 1860), S.300, S.304, Part I - MURDER - CULPABLE HOMICIDE
- Murder or culpable homicide - Sudden quarrel - Accused persons allegedly inflicted
injuries on deceased with chopper - Prosecution version itself showed that deceased first
assaulted one of accused with broken bottle causing injury - Accused had given knife
blow to deceased in sudden quarrel in heat of passion - Conviction of accused would be,
therefore, under S. 304, Part I and not under S. 302.
2005 Cri LJ 2385 (Ker.), Reversed. (Paras 10, 12)
Cases Referred : Chronological Paras
2006 AIR SCW 1678 : 2006 Cri LJ 2111, (Rel. on) 11
C. N. Sree Kumar, P. R. Nayak and Harshad V. Hameed, Advocates for Appellants; G.
Prakash, Advocate for Respondent.
Judgement
Dr. ARIJIT PASAYAT, J.:-Leave granted.
2. Challenge in this appeal is to the order passed by a Division Bench of the Kerala High
Court, dismissing the appeal filed by the appellants who were described as A2 and A3
indicating their position before the trial court, while allowing the appeals filed by the two
other accused persons (A1 and A4).
3. The conviction of the appellants for offence punishable under Section 302 read with
Section 34 of the Indian Penal Code, 1860 (in short the 'IPC') and sentence of
imprisonment for life and a fine of Rs.20,000/- with default stipulation was upheld.
4. The prosecution version in a nutshell is as follows:
On 7.2.1997 at or about 6.45 p.m. at Ayamkudy Kara in Muttuchira Village of Vaikom
Taluk in Kotayam District, the 4th accused came driving his goods autorickshaw (pick-u-
auto) along with A1 to A3 in the said goods carrier and pulled up in front of Marangattil
House of Sathyadevan @ Sahadevan @ Sahadi (hereinafter referred to as the 'deceased').
The deceased was the driver of a mini lorry. A2 straightway went over to the deceased
who was sitting along with PW2 in the veranda of his house. A2 caught hold of the
deceased by the tuck of his dhoti and dragged him on to the Ezhumanthuruthi Kapoola
road in front. The deceased picked up a soda bottle from the parapet of his house. Seeing
this A2 went and picked a soda bottle from the adjacent grocery shop run by Rajamma
(PW 7), the wife of the deceased and came on to the road. From the southern mud road
(road margin) in front of the aforesaid grocery shop, A2 struck the deceased on the head
with the soda bottle. Then the deceased also hit A2 on the head with the soda bottle in his
hand and inflicted an injury. Seeing this A2 sprinkled chilly powder on the eyes of the
deceased. The chilly powder got into the eyes of the deceased who stood there with both
hands held against his face and rubbing his eyes. A1 then exhorted his companions to cut
Sahadevan to death. Thereupon A2 drew a chopper from inside his shirt and cut the
deceased on his head inflicting injuries. A3 stabbed the deceased on his right arm with a
knife inflicting injury. A4 then cut the deceased on the back of his head with a chopper.
The deceased fell on the road and was taken by PWs.1, 2 and 8 to the Kottayam Medical
College Hospital. The deceased who had become unconscious on account of the injuries
sustained by him succumbed to the same at about 2.10 p.m. on 8.2.1997. Since the
aforesaid acts were done by A1 to A4 in prosecution of their common intention to do so,
the accused persons were charged for having committed the offence of murder punishable
under Section 302 read with Section 34 IPC.
On the accused pleading not guilty to the charge framed against them by the court below
for the aforementioned offence, the prosecution was permitted to adduce evidence in
support of its case. The prosecution examined 16 witnesses as PWs 1 to 16 and got
marked 17 documents as Exts. P1 to P17 and 8 material objects as MOs. 1 to8.
After the closure of the prosecution's evidence the accused were questioned under Section
313(1) of the Code of Criminal Procedure, 1973 (in short 'Cr.P.C.') with regard to the
incriminating circumstances appearing against them in the evidence for the prosecution.
They denied those circumstances and maintained their innocence. They admitted that
Exts. P16 and P17 are the wound certificates pertaining to A2 and A3 respectively.
When called upon to enter on their
@page-SC408
defence, the accused examined the Secretary of the Ayamkudy Branch of KPMS as DW1.
5. Placing reliance on the evidence of PWs 2, 3, 7 and 8 the trial Court recorded
conviction. As noted above, appeal was preferred before the High Court by all the four
accused persons, and the appeal filed by the present appellants was dismissed while that
of co-accused was allowed.
6. In support of the appeal learned counsel for the appellant submitted even if prosecution
version accepted in toto offence under Section 302 IPC is not made out. As a matter of
fact it is the prosecution version that the deceased first assaulted appellant No.1 with a
broken bottle and caused several injuries.
7. Learned counsel for the respondent on the other hand submitted that the trial Court and
the High Court have rightly found the accused persons guilty of offence punishable under
Section 302 IPC.
8. In essence the stand of learned counsel for the appellant is that Exception IV to Section
304 IPC would apply to the facts of the case.
9. For bringing in operation of Exception 4 to Section 300 IPC, it has to be established
that the act was committed without premeditation, in a sudden fight in the heat of passion
upon a sudden quarrel without the offender having taken undue advantage and not having
acted in a cruel or unusual manner.
10. The Fourth Exception to Section 300 IPC covers acts done in a sudden fight. The said
Exception deals with a case of prosecution not covered by the First Exception, after
which its place would have been more appropriate. The Exception is founded upon the
same principle, for in both there is absence of premeditation. But, while in the case of
Exception 1 there is total deprivation of self-control, in case of Exception 4, there is only
that heat of passion which clouds men's sober reason and urges them to deeds which they
would not otherwise do. There is provocation in Exception 4 as in Exception 1; but the
injury done is not the direct consequence of that provocation. In fact Exception 4 deals
with cases in which notwithstanding that a blow may have been struck, or some
provocation given in the origin of the dispute or in whatever way the quarrel may have
originated, yet the subsequent conduct of both parties puts them in respect of guilt upon
equal footing. A "sudden fight" implies mutual provocation and blows on each side. The
homicide committed is then clearly not traceable to unilateral provocation, nor in such
cases could the whole blame be placed on one side. For if it were so, the Exception more
appropriately applicable would be Exception 1. There is no previous deliberation or
determination to fight. A fight suddenly takes place, for which both parties are more or
less to be blamed. It may be that one of them starts it, but if the other had not aggravated
it by his own conduct it would not have taken the serious turn it did. There is then mutual
provocation and aggravation, and it is difficult to apportion the share of blame which
attaches to each fighter. The help of Exception 4 can be invoked if death is caused (a)
without premeditation; (b) in a sudden fight; (c) without the offender having taken undue
advantage or acted in a cruel or unusual manner; and (d) the fight must have been with
the person killed. To bring a case within Exception 4 all the ingredients mentioned in it
must be found. It is to be noted that the "fight" occurring in Exception 4 to Section 300
IPC is not defined in IPC. It takes two to make a fight. Heat of passion requires that there
must be no time for the passions to cool down and in this case, the parties have worked
themselves into a fury on account of the verbal altercation in the beginning. A fight is a
combat between two or more persons whether with or without weapons. It is not possible
to enunciate any general rule as to what shall be deemed to be a sudden quarrel. It is a
question of fact and whether a quarrel is sudden or not must necessarily depend upon the
proved facts of each case. For the application of Exception 4, it is not sufficient to show
that there was a sudden quarrel and that there was no premeditation. It must further be
shown that the offender has not taken undue advantage or acted in cruel or unusual
manner. The expression "undue advantage" as used in the provision means "unfair
advantage".
11

. The above position is highlighted in Sandhya Jadhav v. State of Maharashtra (2006) 4


SCC 653). 2006 AIR SCW 1678

12. Considering the background facts, appropriate conviction would be under Section
304 Part I IPC and not Section 302 IPC. The conviction is accordingly altered. Custodial
sentence of ten years would suffice.
@page-SC409
Fine amount is reduced to Rs.5,000/-. In case fine is not paid, default sentence would be
two years.
13. Appeal is allowed to the aforesaid extent.
Appeal allowed.
AIR 2008 SUPREME COURT 409 "Antram v. State of Maharashtra"
(From : Bombay)*
Coram : 2 Dr. A. PASAYAT AND P. SATHASIVAM, JJ.
Criminal Appeal No. 1529 of 2007 (arising out of SLP (Cri.) No. 376 of 2007), D/- 12
-11 -2007.
Antram v. State of Maharashtra.
Penal Code (45 of 1860), S.300, S.299, Exception 2 - Evidence Act (1 of 1872), S.32 -
MURDER - DYING DECLARATION - EVIDENCE - ASSAULT - Murder -
Circumstantial evidence - Accused allegedy assaulted his wife with axe - Relation
between accused and deceased were not cordial - Authenticity of dying declarations of
deceased was established - Dying declarations, both oral and written, did not suffer from
any infirmity - And were sufficient to fasten guilt of accused - Plea that deceased could
have survived with proper medical care and that death is not referable to cause of death in
ordinary course of nature due to ante mortem injuries - Not tenable - Plea clearly
overlooks Exception 2 to S. 299 - Conviction of accused is proper.
AIR 1996 SC 2962 and AIR 1974 SC 2328, Relied on. (Paras 10, 14)
Cases Referred : Chronological Paras
1996 AIR SCW 1174 : AIR 1996 SC 2962 : 1996 Cri LJ 1872, (Rel. on) 12
AIR 1974 SC 2328 : 1975 Cri LJ 16, (Rel. on) 13
Mrs. S. Usha Reddy, for Appellant; R. K. Adsure, for Respondent.
* Cri. Appeal No. 218 of 2005, D/- 24-6-2005 (Bom).
Judgement
Dr. ARIJIT PASAYAT, J.:-Leave granted.
2. Challenge in this appeal is to the judgment of a Division Bench of the Bombay High
Court, Aurangabad Bench dismissing the appeal filed by the appellant upholding his
conviction for offence punishable under Section 302 of the Indian Penal Code, 1860 (in
short the 'IPC')and the sentence of imprisonment for life and fine of Rs.200/- with default
stipulation. The judgment impugned before the High Court was delivered by learned
Second Additional Sessions Judge, Latur in Sessions case No. 24 of 2004.
3. Prosecution version in a nutshell is as follows:
On 28.11.2003 at about 9:30 a.m., appellant Antram caused death of his wife Shobha by
brutally assaulting her with an axe. Shobha was married to the accused long back. Two
sons and the daughter were the children born from said wedlock. About 3 years prior to
alleged incident, Shobha had started residing at village Kamkheda with the children,
which is place of her parents. Accused belongs to village Zari Khurd. He used to
intermittently visit Shobha and children at village Kamkheda. The relations between
husband and wife had not remained cordial because accused used to object to Shobha
undertaking any job. This was because he used to suspect her character.
Accused had been to village Kamkheda about 8 days prior to alleged incident. There is no
eye witness to the incident. Prosecution case rests on circumstantial evidence. Accused
and deceased were in the house at the time of incident. A quarrel took place between the
couple during which accused brutally assaulted Shobha with an axe and thereafter ran
away. Sangeeta (PW-5), daughter of deceased and accused, was about to proceed to
school when the quarrel had started. It was Friday and there was Saraswati Puja in the
school. At the suggestion of teacher, Sangeeta returned home for bringing some flowers.
Since she noticed that house was locked from outside she enquired from the neighbour
about her mother. Ultimately, she returned home, opened the door to find mother Shobha
lying on the floor in injured condition with bleeding injuries on her head, face etc. A
blood stained axe was also lying there. She enquired from her mother as to what had
happened. She disclosed that she was assaulted by Sangeeta's father i.e., accused.
Sangeeta reported the matter to her maternal uncle Tukaram (PW-2), who arrived at the
spot and enquired from Shobha when she repeated that she was assaulted by accused.
Tukaram (P.W.2) and his uncle Ganpat took Shobha to Hospital at Renapur in an auto
rickshaw. At the advice of Medical Officer, Renapur, she was
@page-SC410
shifted to Civil Hospital, Latur. The Medical Officer at Civil Hospital, Latur, advised
them to take her to S.R.T. Medical College, Ambajogal. The relatives, however, took her
to Dr. Sham Agroya (P.W.6) a private medical practitioner and neuro surgeon at Latur.
Tukaram went to Police Station, Renapur and reported the matter to Police. His report
was reduced to writing and the same was treated as FIR (Exh.24), which set law into
motion.
4. Although prosecution does not have any direct evidence about the incident on record, it
relies upon dying declaration of deceased Shobha on more than one occasions. Apart
from oral narration to daughter Sangeeta and cousin brother Tukaram, the dying
declaration has also come on record in the form of history of incident as recorded by
Medical Officer Dr. Warad (P.W.4), who was then attached to Primary Health Centre,
Renapur, where injured Shobha was taken immediately after incident. As it was a medico
legal case, Dr. Agroya, while admitting Shobha, gave intimation of the same to Police
Station by a written letter, whereupon Police Inspector visited the hospital on 29.11.2003
and in presence of Dr. Agroya, he recorded statement of injured Shobha. Shobha was
subjected to surgical treatment by Dr. Agroya on 29.11.2003 and subsequently she was
discharged from the hospital on 09.12.2003 as cured patient. However, Shobha expired
on 10.12.2003.
5. Consequently, the offence, which was initially registered under Section 307 of IPC was
converted to one under Section 302 of IPC. On completion of the investigation, charge
sheet was filed in the Court of competent Magistrate and upon committal, Sessions Judge
recorded conviction and sentence as described hereinabove at the conclusion of Sessions
trial.
6. The accused in his statement, recorded under Section 313 of the Code of Criminal
Procedure, 1973 (in short the 'Code'), pleaded innocence. Before the trial court ten
witnesses were examined to further prosecution version.
7. Before the High Court the stand of the appellant essentially was that the dying
declarations are not reliable. As a matter of fact there were four dying declarations
recorded; two were oral and two were recorded. Apart from oral narration to Sangeeta
(PW-5) daughter of the deceased , Tukaram (PW2) cousin brother's statement was
recorded as dying declarations by PW.4 Dr. Vilas Warad, Medical Officer, Primary Health
Centre, Renapur who initially examined the injured and recorded her statement. Dr.
Agroya (PW-6) while admitting the deceased gave intimation to the Police station . It was
also submitted that the offences were not covered under Section 302 IPC, 304 Part I and
304 Part II IPC. The trial court did not accept this stand and recorded conviction and
sentence as noted above. The accused and the State reiterated the respective stand before
the High Court. High Court found that the dying declarations were reliable and there was
not much variation in the version. However, the dying declaration as contained in Exh. 36
was kept out of consideration, and the dying declarations before the doctor and the cousin
brother were accepted. Coming to the plea that the case was not covered under Section
302 IPC, the High Court referred to the factual aspects, the injuries sustained and came to
the conclusion that case was clearly covered under Section 302 IPC.
8. The stand taken by the appellant before the High Court was reiterated.
9. Learned counsel for the State supported the judgment of the courts below.
10. So far as the dying declarations are concerned as rightly observed by the High Court
even if Exhibit 36 is kept out of consideration, the dying declarations both oral and
written were sufficient to fasten the guilt of the accused. The High Court has elaborately
dealt with the authenticity of the dying declarations and had rightly come to the
conclusion that they did not suffer from any infirmity.
11. Coming to the question as to applicability of Section 302 IPC, great emphasis was
laid on the evidence of Dr. S.K. Shinde (PW-7). It was contended that the death was due
to medical negligence and therefore accused could not have been convicted under Section
302 IPC. It was submitted that had the patient been given proper care, there was a
possibility of removing thick mucus and food particles from trachea and bronchi by using
certain instruments and with proper
@page-SC411
medicines, she could have survived. The High Court noted that the throwing out the
vomit by the deceased was not a natural course but it was a result of two injuries i.e.
injuries Nos. 3 and 4. The High Court found that the presence of mucus and food
particles in the trachea and bronchi cannot be totally delinked from the injuries inflicted
by the accused. It was the stand of the accused that the death was due to Septicaemia and
therefore, it is not referable to cause of death in the ordinary course of nature due to ante
mortem injuries.
12

. In State of Haryana v. Pala and Ors. (AIR 1996 SC 2962) it was noted as follows.
1996 AIR SCW 1174, (Para 3)

"In answering the question whether a wound is dangerous to life, the danger must be
assessed on the probable primary effects of the injury. Such possibilities as the
occurrence of tetanus or septicaemia, later on, are not to be taken into consideration."
13. In Sudershan Kumar v. State of Delhi (AIR 1974 SC 2328) it was noted as follows:
"The fact that the deceased lingered for about 12 days would not show that the death was
not the direct result of the act of the accused in throwing acid on her. So also the fact that
the deceased developed symptoms of malaena and respiratory failure and they also
contributed to her death could not in any way affect the conclusion that the injuries
caused by the acid burns were the direct cause of her death."
14. As noted above it was emphasized by learned counsel for the appellant that with
proper medical care the deceased could have survived and therefore Section 302 IPC has
no application. The plea clearly overlooks Exception 2 to Section 299 IPC, which reads
as follows:
"Explanation 2.- Where death is caused by bodily injury, the person who causes such
bodily injury shall be deemed to have caused the death, although by resorting to proper
remedies and skilful treatment the death might have been prevented."
15. When the background facts are examined on the touchstone of the principles of law
highlighted, the inevitable result is that the appeal is without merit, deserves dismissal,
which we direct.
Appeal dismissed.
AIR 2008 SUPREME COURT 411 "State of U. P. v. Atar Singh"
(From : Allahabad)*
Coram : 2 Dr. A. PASAYAT AND D. K. JAIN, JJ.
Criminal Appeal No. 54 of 2001, D/- 12 -11 -2007.
State of U.P. v. Atar Singh and Ors.
(A) Penal Code (45 of 1860), S.300 - MURDER - Murder - Proof - Non-explanation of
injuries on accused by prosecution - Not by itself sufficient to reject other probable,
consistent and creditworthy evidence - Moreso when injuries are simple or superficial in
nature.
It is not an invariable rule that the prosecution has to explain the injuries sustained by the
accused in the same occurrence. If the witnesses examined on behalf of the prosecution
are believed by the Court in proof of guilt of the accused beyond reasonable doubt,
question of obligation of prosecution to explain injuries sustained by the accused will not
arise. When the prosecution comes with a definite case that the offence has been
committed by the accused and proves it's case beyond any reasonable doubt, it becomes
hardly necessary for the prosecution to again explain how and under what circumstances
injuries have been inflicted on the person of the accused. It is more so when the injuries
are simple or superficial in nature. In the case at hand, trifle and superficial injuries on
accused are of little assistance to them to throw doubt on veracity of prosecution case.
AIR 1990 SC 1459, AIR 1972 SC 2593, 2003 AIR SCW 6905, Rel. on.
(Paras 12, 13)
(B) Penal Code (45 of 1860), S.300 - MURDER - ASSAULT - WITNESS -
INVESTIGATION - Murder - Proof - Accused persons assaulted deceased - No
immediate motive proved - No corroboration to prosecution version by any independent
witnesses - Presence of alleged eye- witness on spot not established - Persons whose
name noted in FIR as witnesses, not examined - Statement of deceased recorded by
investigating officer under S. 161 of Cr. P. C. cannot be treated to be dying declaration -
Non- recording of dying declaration in presence of Magistrate not explained - Held in
@page-SC412
circumstances acquittal of accused, cannot be interfered with. (Para 14)
Cases Referred : Chronological Paras
2006 AIR SCW 3568 : AIR 2006 SC 2667 : 2006 Cri LJ 3634 10
2003 AIR SCW 4065 : AIR 2003 SC 3609 : 2003 Cri LJ 3892 10
2003 AIR SCW 5044 : AIR 2003 SC 4407 : 2003 Cri LJ 5010 10
2003 AIR SCW 5095 : AIR 2003 SC 4664 : 2003 Cri LJ 5040 10
2003 AIR SCW 6905 : AIR 2004 SC 742 (Rel. on) 13
2002 AIR SCW 1532 : AIR 2002 SC 1621 : 2002 Cri LJ 2024 10
2000 AIR SCW 1430 : AIR 2000 SC 1833 : 2000 Cri LJ 2212 10
1996 AIR SCW 2438 : AIR 1996 SC 2035 : 1996 Cri LJ 2867 10
AIR 1990 SC 1459 : 1990 Cri LJ 1510 (Rel. on) 12
AIR 1988 SC 863 : 1988 Cri LJ 925 13
AIR 1976 SC 2263 : 1976 Cri LJ 1736 12
AIR 1974 SC 2165 : 1974 Cri LJ 1486 5
AIR 1973 SC 2622 : 1973 Cri LJ 1783 10
AIR 1972 SC 2593 : 1973 Cri LJ 44 (Rel. on) 13
AIR 1968 SC 1281 : 1968 Cri LJ 1479 12
Ratnakar Dash, Sr. Advocate, Sanjay Singh, Anuvrat Sharma, for Appellant; Ms. Kusum
Chaudhary, for Respondents.
* Cri. A. No. 2124 of 1980, D/- 13-4-2000, reported in 2000 All LJ 2012 : 2000 Cri LJ
4933 (All.)
Judgement
Dr. ARIJIT PASAYAT, J.:- Challenge in this appeal is to the judgment rendered by a
Division Bench of the Allahabad High Court which by the impugned judgment acquitted
the respondents and set aside the conviction recorded by the learned Additional Sessions
Judge in .Sessions Trial No.316 of 1979. Each of the accused had been convicted by the
trial court and sentenced to life imprisonment under Section 302 of the Indian Penal
Code, 1860 (in short the 'IPC') read with Section 149 IPC, three months RI under Section
323 read with Section 149 IPC, six months RI under Section 324 IPC read with Section
149 IPC and two years RI under Section 452 IPC. Accused Jai Singh, Atar Singh, Mohan
Singh, Beer Singh and Baburam were further convicted under Section 147 IPC and
sentenced to nine months RI. Accused Ramesh and Lal Singh were however convicted
under Section 148 IPC and sentenced to one year's RI. All the sentences were directed to
run concurrently. The High Court reversed the judgment and directed acquittal in the
appeal filed by the accused persons.
2. Prosecution version as unfolded during trial is as follows:
One Ram Murti (hereinafter referred to as 'deceased') lost his life in the incident whereas
three others namely, Shyam Pal (PW 1), Sohan Pal (PW 3) and Katori Devi sustained
injuries. The incident took place on 4.5.1979 at about 6.30 P.M. in village Balli Nagla,
Police Station Qadarchowk, District Budaun. The report of the incident was lodged by
Shyam Pal (PW 1) on 5.5.1979 at 3.15 A.M. The distance of police station from the place
of occurrence is 8 kms. The accused-respondents Lal Singh and Ramesh were allegedly
armed with spears whereas rest had lathis. The accused-respondents Jai Singh, Atar
Singh, Lal Singh, Mohar Singh and Beer Singh are the sons of Dallu who also allegedly
participated in the incident but died after few days of the incident. About 6 months before
this incident, Durgapal-brother-in-law of Shyam Pal (PW 1) had abducted Dhika daughter
of Dallu. Accused-respondents began to bear ill will against him and his family members
on this account. On 4-5-79 at about 6.30 P.M., exchange of hot words and abuses took
place between Shyam Pal (PW 1) and Dallu at the Chaupal of Nek Ram in connection
with abduction of Dhika. Some persons intervened in the matter and Shyam Pal went to
his home. A little later, all the accused-respondents along with Dallu entered the house of
Shyam Pal. As mentioned earlier, Lal Singh and Ramesh were armed with spears whereas
rest had lathis. Dallu asked the other accused persons to teach a lesson to Shyam Pal and
his family members for defaming him. All the accused-respondents then started
assaulting Shyam Pal (PW 1) and his brothers Sonpal and Ram Murti who were present
there. When their mother Katori Devi came to their rescue, she was also beaten up. Nathu
Singh (PW 2), Ulnfat Irfan, Prem Pal and others also arrived there. Shyam Pal (PW 1),
Ram Murti, Sohan Pal (PW 3) and their mother Katori Devi sustained injuries. Shyam Pal
(PW 2) with his nephew Prempal went to the police station and lodged a report by oral
narration on 5.5.1979 at 3.15 A.M. which was taken down by head constable Baburam
(PW 4). Investigation was undertaken and on completion thereof, charge sheet was filed.
Accused persons pleaded innocence. In order to
@page-SC413
further accusations, prosecution examined eleven witnesses. Learned trial Judge recorded
conviction primarily relying on the evidence of injured witnesses.
3. It was firstly noticed by the High Court that the motive assigned by the prosecution
against the accused respondents did not stand the test of logic. The incident of kidnapping
and abduction of Dhika daughter of Dallu by Durgapal-brother-in-law of Shyam Pal
(PW-1) had taken place about six months before. Even no FIR had been lodged against
Durgapal from the side of accused persons regarding that incident. It was admitted by
PW-1 that even no Panchayat was convened. Further Shyam Pal (PW-1) had admitted
that at the time of exchange of hot words with Dallu at the Chaupal of Nek Ram, two
persons namely, Nek Ram and Urman Singh were there who had intervened. None of
them was produced by the prosecution to indicate the origin of the incident. Dallu himself
was a T.B. patient and the High Court found it hard to believe that after alleged exchange
of hot words at the Chaupal of Nek Ram, he with all his sons, brother and nephew would
have appeared in the house of PW-1 to assault him and his family members. Accordingly,
it was held that even there was no immediate motive for the alleged occurrence.
4. It was also noted that there was no corroboration to the prosecution version by any
independent witnesses. Nathu Singh (PW-2) was resident of another village who claimed
to be present at the place of occurence. He stated that he had come to the village to meet
his relative. According to him the house of Rajpal was situated at a distance of 15-16
paces from the place of incident. The High Court noted that the existence of Rajpal's
house in the vicinity of place of occurrence had not been shown in the site plan. The High
Court found that some parts of his statement could not be reconciled with other parts eg.
that he had reached the village of incident at 6.30 a.m. and was present at the time of
incident which took place about 12 hours later. His statement was to the effect that he had
gone to his son- in-law Rajpal as the latter was about to go to his father-in-law's house
and he wanted to send some cows to his father-in-law. He wanted to send this information
to his father-in-law but his cousin-in-law was not available. He also stated that after some
time he had returned to his village. The High Court found his presence to be not
established. The High Court also noted that Sohan Pal (PW-3) who claimed to be an eye
witness was the brother of PW-1.
5. The High Court noted that even though in the FIR names of some other persons have
been noted as witnesses, none of them had been examined. The High Court was of the
view that statement of the deceased recorded by the investigating officer under Section
161 of the Code of Criminal Procedure, 1973 (in short the 'Cr.P.C.') cannot be treated to
be the dying declaration. The investigating officer (PW-11) noted that when he reached
the spot in the morning of 5.5.1979 subsequent to the lodging of the FIR at about 3.15
a.m. he had found the deceased, Sohan Pal and Katori to be lying there in injured
condition. He recorded the statement of the deceased (Exh.Ka. 20). The High Court
referred to the bed head ticket of the deceased in which it was stated that his general
condition was noted low when he was admitted in the hospital on 5.5.1979. The High
Court also noted the admitted position that the investigating officer did not follow the
instructions contained in Rule 115 of the U.P. Police Regulations relating to recording of
dying declaration. Reference was made to a decision of this Court in Palak Ram v. State
of U.P. ( AIR 1974 SC 2165) wherein it was noted that it would not be prudent to base
conviction on a dying declaration made to the investigating officer which is not signed by
the persons making it and has not been taken in the presence of two witnesses.
6. The High Court also noted that there was no explanation offered as to why the dying
declaration was not recorded in the presence of the Magistrate which is the usual course,
though he died on 7.5.1979 at about 4.00 p.m. Therefore, the High Court treated the same
to be a statement recorded in terms of Section 161 of Cr.P.C. which cannot be treated to
be a dying declaration.
7. The High Court also noted another factor which according to it was significant, i.e. the
presence of large number of injuries on accused Mohar Singh for which no explanation
was offered. This according to the High Court cast a genuine doubt about the actual time,
place, number of assailants and weapons for the injuries. The High Court noted that
injuries on accused Mohar Singh were not superficial and some of them were even
incised wounds. The investigating officer had admitted that Mohar Singh was
@page-SC414
arrested on 6.5.1979. The High Court found it rather unusual that he was produced for
medical examination before a Doctor Shiv Kumar Saxena (PW?5) on 5.5.1979 at 5.20
p.m. by a constable of the Police Station. Therefore, the High Court noted that if there
was no explanation offered as to why he was not arrested on 5.5.1979, the FIR was
claimed to have been lodged at 3.15 a.m. on that day. The High Court noted that though
PW-1 and PW-3 were stated to be injured witnesses in the background facts the
prosecution version was highly improbabilised. The evidence of PW-2 was found to be
not truthful. As a cumulative result of the discussions the High Court found that the
prosecution has not been able to substantiate its version.
8. As noted above, the State has questioned correctness of the conclusions recorded by
the High Court. With reference to the evidence of injured witnesses, PW-1 and PW-3 it is
stated that they are injured witnesses and their version was to be taken as credible and
cogent. There was no reason as to why the injured person would falsely implicate the
innocent person.
9. None appeared for the respondents when the matter was called.
10

. There is no embargo on the appellate Court reviewing the evidence upon which an order
of acquittal is based. Generally, the order of acquittal shall not be interfered with because
the presumption of innocence of the accused is further strengthened by acquittal. The
golden thread which runs through the web of administration of justice in criminal cases is
that if two views are possible on the evidence adduced in the case, one pointing to the
guilt of the accused and the other to his innocence, the view which is favourable to the
accused should be adopted. The paramount consideration of the Court is to ensure that
miscarriage of justice is prevented. A miscarriage of justice which may arise from
acquittal of the guilty is no less than from the conviction of an innocent. In a case where
admissible evidence is ignored, a duty is cast upon the appellate Court to re-appreciate
the evidence where the accused has been acquitted, for the purpose of ascertaining as to
whether any of the accused really committed any offence or not. [See Bhagwan Singh
and Ors. v. State of Madhya Pradesh (2002 (2) Supreme 567)]. The principle to be
followed by appellate Court considering the appeal against the judgment of acquittal is to
interfere only when there are compelling and substantial reasons for doing so. If the
impugned judgment is clearly unreasonable and relevant and convincing materials have
been unjustifiably eliminated in the process, it is a compelling reason for interference.
These aspects were highlighted by this Court in Shivaji Sahabrao Bobade and Anr. v.
State of Maharashtra (AIR 1973 SC 2622), Ramesh Babulal Doshi v. State of Gujarat
(1996 (4) Supreme 167), Jaswant Singh v. State of Haryana (2000 (3) Supreme 320), Raj
Kishore Jha v. State of Bihar and Ors. (2003 (7) Supreme 152), State of Punjab v. Karnail
Singh (2003 (5) Supreme 508 and State of Punjab v. Pohla Singh and Anr. (2003 (7)
Supreme 17) and V.N. Ratheesh v. State of Kerala (2006(10) SCC 617). 2002 AIR
SCW 1532
1996 AIR SCW 2438
2000 AIR SCW 1430
2003 AIR SCW 5095
2003 AIR SCW 4065
2003 AIR SCW 5044
2006 AIR SCW 3568

11. As is rightly contended by learned counsel for the appellant-State in isolation the
circumstances highlighted by the High Court may not be sufficient to direct acquittal.
Two important factors which have been noted by the High Court are (i) non explanation
of injuries on accused Mohar Singh and (ii) the reason for his non arrest on 5.5.1979
when he had appeared before the police officers and had been sent for medical
examination.
12

. We shall first deal with the question regarding non-explanation of injuries on the
accused. Issue is if there is no such explanation what would be its effect? We are not
prepared to agree with the learned counsel for the defence that in each and every case
where prosecution fails to explain the injuries found on some of the accused, the
prosecution case should automatically be rejected, without any further probe. In Mohar
Rai and Bharath Rai v. The State of Bihar (1968 (3) SCR 525), it was observed: AIR
1968 SC 1281, Para 6

"...In our judgment, the failure of the prosecution to offer any explanation in that regard
shows that evidence of the prosecution witnesses relating to the incident is not true or at
any rate not wholly true. Further those injuries probabilise the plea taken by
@page-SC415
the appellants."

In another important case Lakshmi Singh and Ors. v. State of Bihar (1976 (4) SCC 394),
after referring to the ratio laid down in Mohar Rai's case (supra), this Court observed:
AIR 1976 SC 2263

"Where the prosecution fails to explain the injuries on the accused, two results follow:
(1) that the evidence of the prosecution witnesses is untrue; and (2) that the injuries
probabilise the plea taken by the appellants."
It was further observed that:
"In a murder case, the non-explanation of the injuries sustained by the accused at about
the time of the occurrence or in the course of altercation is a very important circumstance
from which the Court can draw the following inferences:
(1) that the prosecution has suppressed the genesis and the origin of the occurrence and
has thus not presented the true version;
(2) that the witnesses who have denied the presence of the injuries on the person of the
accused are lying on a most material point and, therefore, their evidence is unreliable;
(3) that in case there is a defence version which explains the injuries on the person of the
accused assumes much greater importance where the evidence consists of interested or
inimical witnesses or where the defence gives a version which competes in probability
with that of the prosecution one."

In Mohar Rai's case (supra) it is made clear that failure of the prosecution to offer any
explanation regarding the injuries found on the accused may show that the evidence
related to the incident is not true or at any rate not wholly true. Likewise in Lakshmi
Singh's case (supra) it is observed that any non-explanation of the injuries on the accused
by the prosecution may affect the prosecution case. But such a non-explanation may
assume greater importance where the defence gives a version which competes in
probability with that of the prosecution. But where the evidence is clear, cogent and
creditworthy and where the Court can distinguish the truth from falsehood the mere fact
that the injuries are not explained by the prosecution cannot by itself be a sole basis to
reject such evidence, and consequently the whole case. Much depends on the facts and
circumstances of each case. These aspects were highlighted by this Court in Vijayee
Singh and Ors. v. State of U.P. (AIR 1990 SC 1459). AIR 1968 SC 1281
AIR 1976 SC 2263

13

. Non-explanation of injuries by the prosecution will not affect prosecution case where
injuries sustained by the accused are minor and superficial or where the evidence is so
clear and cogent, so independent and disinterested, so probable, consistent and
creditworthy, that it outweighs the effect of the omission on the part of prosecution to
explain the injuries. As observed by this Court in Ramlagan Singh v. State of Bihar (AIR
1972 SC 2593) prosecution is not called upon in all cases to explain the injuries received
by the accused persons. It is for the defence to put questions to the prosecution witnesses
regarding the injuries of the accused persons. When that is not done, there is no occasion
for the prosecution witnesses to explain any injury on the person of an accused. In Hare
Krishna Singh and Ors. v. State of Bihar (AIR 1988 SC 863), it was observed that the
obligation of the prosecution to explain the injuries sustained by the accused in the same
occurrence may not arise in each and every case. In other words, it is not an invariable
rule that the prosecution has to explain the injuries sustained by the accused in the same
occurrence. If the witnesses examined on behalf of the prosecution are believed by the
Court in proof of guilt of the accused beyond reasonable doubt, question of obligation of
prosecution to explain injuries sustained by the accused will not arise. When the
prosecution comes with a definite case that the offence has been committed by the
accused and proves it's case beyond any reasonable doubt, it becomes hardly necessary
for the prosecution to again explain how and under what circumstances injuries have
been inflicted on the person of the accused. It is more so when the injuries are simple or
superficial in nature. In the case at hand, trifle and superficial injuries on accused are of
little assistance to them to throw doubt on veracity of prosecution case. (See Surendra
Paswan v. State of Jharkhand (2003) 8 Supreme 476). 2003 AIR SCW 6905

14. Considering the cumulative effect of circumstances which have weighed with the
@page-SC416
High Court to direct acquittal, it cannot be said that the view taken by the High Court is
not a plausible view. That being so, we are not inclined to interfere with the order of
acquittal. The appeal deserves to be dismissed which we direct.
Appeal dismissed.
AIR 2008 SUPREME COURT 416 "P. Vaikunta Shenoy and Co., M/s. v. P. Hari Sharma"
(From : 2001 (3) Kant LJ 357)
Coram : 2 A. K. MATHUR AND MARKANDEY KATJU, JJ.
Civil Appeal No. 5540 of 2001, D/- 31 -10 -2007.
M/s. P. Vaikunta Shenoy and Co. v. P. Hari Sharma.
Karnataka Money Lenders Act (12 of 1962), S.2(10) - MONEY LENDERS - WORDS
AND PHRASES - Money lender - Definition has to be given purposive interpretation -
Person advancing money to supplier of goods to ensure regular supply - Not a money
lender.
2001 (3) Kant LJ 357, Reversed.
In business various methods are adopted by a businessman for ensuring the smooth
running of his business. Very often, one of the methods is that the businessman advances
money to his supplier of goods to ensure that the supplies are regular and are made to him
rather than being diverted to other parties. There is nothing illegal in this practice and it is
widespread. In such cases the object of advancing the loan is not to earn interest thereon
but to ensure the regular supply of goods. Though, no doubt, interest is charged on these
loans yet that was not the principal object of advancing the loan. Such a person cannot be
said to be a money lender. The purpose of the Act is to prevent the malpractice of
oppression by money lenders to take advantage of peoples' poverty. Keeping in view the
object of Act a purposive interpretation has to be given to the definition of money
lenders.
2001 (3) Kant LJ 357, Reversed. (Paras 7, 8, 9, 10, 13)
Cases Referred : Chronological Paras
AIR 1988 SC 2239 (Ref.) 12
AIR 1963 SC 1207 (Foll.) 11
V. B. Joshi, Kailash Pandey, for Appellant; G. V. Chandrashekhar, P. P. Singh, for
Respondent.
Judgement
1. MARKANDEY KATJU, J.:-This appeal has been filed against the impugned judgment
of the Karnataka High Court dated 25.03.2000 in R.F.A. No. 531 of 1997. We have heard
learned counsel for the parties and perused the record.
2. The plaintiff-appellant has alleged that he was carrying the business of commission
agent. The defendant was having an areca nut (supari) garden and he used to supply the
areca nuts to the plaintiff. The defendant used to receive money from the plaintiff off and
on, which the plaintiff used to advance him to secure regular supply of the areca nuts. It
was alleged by the plaintiff that defendant had borrowed Rs.72,044.43 paise as per the
ledger account regularly maintained by the plaintiff. Hence the plaintiff filed a suit for
recovery of this amount with interest at the rate of 18 per cent per annum.
3. The defendant denied the plaintiffs case and advanced the plea that plaintiff was a
money-lender and he did not have a licence as required by the Karnataka Money Lenders
Act, 1961. Consequently, the defendant alleged that the suit was not maintainable as the
plaintiff had not taken a licence under the aforesaid Act.
4. The Trial Court decreed the suit of the plaintiff but the said decree was set aside by the
High Court. Hence this appeal.
5. Learned counsel for the plaintiff-appellant has submitted that the plaintiff was not a
money-lender as defined in Section 2 (10) of the Karnataka Money Lenders Act. The
aforesaid Section 2 (10) states that a money-lender is one who "carries on the business of
money lending in the State."
Section 2 (2) defines the business of money lending as follows:-
'Business of money lending means business of advancing loan whether or not in
connection with or in addition to any other business.'
6. Learned counsel for the respondent submits that in view of the aforesaid definitions the
appellant was clearly a money-lender. We do not agree.
7. It may be mentioned that the purpose of the Act was to prevent the malpractice of
oppression by money-lenders to take advantage of people's poverty.
8. In the money lending business the object of the money-lender is to earn interest on the
loan he has advanced. In the
@page-SC417
present case the object of advancing the loan by the appellant was not to earn interest
thereon but to ensure the regular supply of areca nuts. Though, no doubt, interest at the
rate of 18 per cent per annum was charged on these loans yet that was not the principal
object of advancing the loan.
9. In business various methods are adopted by a businessman for ensuring the smooth
running of his business. Very often, one of the methods is that the businessman advances
money to his supplier of goods to ensure that the supplies are regular and are made to him
rather than being diverted to other parties. There is nothing illegal in this practice and it is
widespread.
10. When we construe the provisions of the Karnataka Money Lenders Act we must see
the object for which it was made and we have to adopt the purposive construction.
11. As observed by this Court in New India Sugar Mills v. Commissioner of Sales Tax
[AIR 1963 SC 1207, p. 1213 : 1963 Supp (2) SCR 459]:-
"It is a recognized rule of interpretation of statutes that expressions used therein should
ordinarily be understood in a sense in which they best harmonize with the object of the
statute, and which effectuate the object of the legislature." (See also the decisions
mentioned in G.P. Singh's "Principles of Statutory Interpretation: 9th Edition 2004 at
Page 110).
12. To give an example, under the U.P. Bhoodan Yagna Act, 1953 the lands which were
donated by large landholders could be allotted to landless persons. It was held by this
Court in U.P. Bhoodan Yagna Samiti v. Braj Kishore [AIR 1988 SC 2239: 1988 (4) SCC
274] that the expression landless persons should be interpreted to mean landless peasants
and not landless businessman. If a literal meaning was given to the expression 'landless
persons' then even a very rich businessman who possessed hundreds of crores of rupees
can claim allotment of a piece of land on the ground that he was a landless person as he
owns no land. That could not possibly be the object of the Act. The object of the Act was
to give land to landless peasants only.
13. In view of the above discussion we are of the opinion that a purposive interpretation
has to be given to the definition of money-lenders. From this angle the appellant could
not be said to be a money-lender as he was not really doing the business of money
lending in the strict sense but was only advancing loans to secure the regular supply of
areca nuts.
14. In view of the above this appeal is allowed, impugned judgment of the High Court is
set aside and the judgment of the trial court is restored. No order as to costs.
Appeal allowed.
AIR 2008 SUPREME COURT 417 "State of Haryana v. Navneet Verma"
(From : 2004 (5) Serv LR 242 (Punj and Hary))
Coram : 2 TARUN CHATTERJEE AND P. SATHASIVAM, JJ.
Civil Appeal No. 5064 of 2007 (arising out of SLP (C) No. 23499 of 2004), D/- 31 -10
-2007.
State of Haryana and Ors. v. Navneet Verma.
(A) Constitution of India, Art.16, Art.226 - EQUALITY IN PUBLIC EMPLOYMENT -
WRITS - Abolition of post - Powers of Govt. - Scope of interference by Court - Limited
to cases where abolition is activated by mala fide.
The power of Govt. to abolish posts and the scope of power of Courts to interfere can be
summarized as follows :-
(a) The power to create or abolish a post rests with the Government;
(b) Whether a particular post is necessary is a matter depending upon the exigencies of
the situation and administrative necessity;
(c) creation and abolition of posts is a matter of Government policy and every sovereign
Government has this power in the interest and necessity of internal administration;
(d) creation, continuance and abolition of posts are all decided by the Government in the
interest of administration and general public;
(e) the Court would be the least competent in the face of scanty material to decide
whether the Government acted honestly in creating a post or refusing to create a post or
its decision suffers from mala fide, legal or factual;
(f) as long as the decision to abolish the post is taken in good faith in the absence of
material, interference by the Court is not warranted. (Para 11)
@page-SC418
(B) Constitution of India, Art.16 - EQUALITY IN PUBLIC EMPLOYMENT -
CONSTITUTIONALITY OF AN ACT - SERVICE MATTERS - Abolition of post -
Validity - Posts of Account Executive in State Bureau of public enterprise - Posts purely
temporary - Respondent appointed as Accounts Executive - Abolition of posts challenged
by him as being means to weed him out - Misunderstanding between him and his superior
and enquiry held against him pleaded in support - Record, however, showing that
abolition was made after assessment of work load and on basis of report of Committee -
Many more posts in Bureau have been abolished subsequently in effort to control non-
planned expenditure - Abolition of posts of Accounts Executive cannot be said to be mala
fide.
2004 (5) Serv LR 242 (Pand H), Reversed. (Paras 15, 16)
Cases Referred : Chronological Paras
2006 AIR SCW 1797 : AIR 2006 SC 3413 (Ref.) 10
AIR 1980 SC 1255 : 1980 Lab IC 710 (Ref.) 10
AIR 1976 SC 1199 : 1976 Lab IC 849 (Ref.) 10
AIR 1973 SC 2641 : 1973 Lab IC 1593 (Ref.) 10
AIR 1972 SC 873 : 1972 Lab IC 433 (Ref.) 10
Manjit Singh, AAG., P. N. Misra, Sr. Advocate, Hari Kesh Singh and T. V. George, with
them for Appellants; M. K. Dua and Satbir Singh, for Respondent.
Judgement
P. SATHASIVAM, J.:-Leave granted.
2. Whether the abolition of the post has been done in good faith or whether it is a
camouflage to cover up and conceal the real intention of weeding out the respondent from
service is the only question to be decided in this appeal.
BRIEF FACTS:
3. The respondent-herein was appointed as Accounts Executive in the Haryana Bureau of
Public Enterprises (in short the HBPE) on 16.07.1993. While continuing so, his services
were terminated on 31.12.1994 on the ground that the post of Accounts Executive has
been abolished. According to the respondent-herein, the third appellant applied for the
post of Financial Adviser. Even though she did not fulfill the prescribed requirement of
three years experience after doing chartered accountancy, she had been appointed as
Financial Adviser and the respondent-herein who was appointed as Accounts Executive
was required to report to her due to which she wanted him to work as her personal staff.
He did not carry out petty directions. When he brought these facts to the notice of the
Member Secretary, HBPE, he wanted him to resign the job. The Member Secretary and
the Financial Adviser seemed to have different attitude and started planning to eliminate
him. Having no other option, on 26.07.1994, he made a representation to the then Chief
Minister of Haryana. In the meanwhile, the Financial Adviser-third appellant herein
lodged a false and baseless complaint against him to the Member Secretary. Based on the
complaint of the Financial Adviser, a preliminary inquiry was conducted. However, no
action was taken against him on the basis of the report of the Inquiry Officer. But instead
of taking any action, in accordance with law, his services have been dispensed with
consequent upon the abolition of the posts of Accounts Executives.
4. According to the respondent, there is no justification for abolition of the posts of
Accounts Executive and it was done with a mala fide intention to dispense with his
services without any basis. Though two posts of Accounts Executives were advertised,
only one post was filled up by appointing him. Thus, according to him, the post was not
abolished in good faith, but this was a device to weed him out from service. Therefore,
the order of termination on the ground of abolition of post is liable to be set aside.
5. It is the case of Haryana Government and HBPE that the abolition of posts of Accounts
Executives was not done with mala fide intention or extraneous reasons. According to
them, in January, 1994, it was felt that the work of Bureau was not being performed as
per official requirements and it required restructuring of the staff vis-a-vis the work load
of the Bureau and it was observed that the contribution of two posts of Accounts
Executives, especially, when there are two posts of Accountants were not result oriented
and the work could smoothly be carried out on even without the two posts of Accounts
Executives. It was further stated that the Accountants can send their case directly to the
Financial Advisor, who was the head of the financial wing in giving advice regarding
financial offers. Consequently, two posts of Accounts Executives were abolished and
services of the respondent
@page-SC419
were terminated as he was no longer required.
6. Though a complaint was received from the Financial Adviser regarding mis-behaviour
by the respondent-herein, preliminary inquiry was conducted into the allegations made,
but no action was taken and the preliminary inquiry has no relevance with regard to the
decision taken on the abolition of the posts. The said decision was taken to abolish the
posts of Accounts Executives after obtaining permission of the government.
7. The Learned Single Judge of the Punjab and Haryana High Court, after finding that the
abolition of posts of Accounts Executives have not been done in good faith but only
intended to get rid of the respondent-writ petitioner herein, quashed the order dated
30.12.1994 abolishing the posts of Accounts Executive and consequential termination of
services of the writ petitioner. In the same order, the learned Judge issued direction for
reinstatement with all consequential benefits. The said order was challenged by the
Government of Haryana, HBPE as well as Smt. Kiran Lekha Walia, Financial Adviser,
HBPE in Letters Patent Appeal No. 163 of 1999. The Division Bench, by impugned
order, accepted the conclusion arrived at by the learned Single Judge and finding no merit
in the appeal dismissed the same with no order as to costs. Questioning the order of the
High Court, the appellants have filed the above appeal by way of special leave.
8. We have heard Mr. P.N.Misra, learned senior counsel, appearing for the appellants and
Mr. M.K.Dua, learned counsel, appearing for the respondent.
9. As observed earlier, we have to find out whether the abolition of posts of Accounts
Executive has been done in good faith or whether it is a camouflage to cover up and send
out the respondent-herein from service.
10. Before proceeding to ascertain the answer for the above question, it is useful to refer
to the appointment order of the Government of Haryana dated 13.07.1993 wherein the
respondent-herein was appointed as Accounts Executive in HBPE. Among the other
terms, clause 2 of the said order is relevant which reads as under:-
"This offer of appointment is purely against temporary post which is liable to be
abolished at any time and carries no promise of subsequent permanent employment. No
offer of permanent vacancy can be made to him at present. Consequently his services can
be terminated without notice whenever there is no vacancy against which he can be
retained."
It is clear that the respondent-herein was appointed purely against temporary post and it is
liable to be abolished at any time. The said clause makes it clear that the post has no
assurance or promise for a permanent employment. It also makes it clear that his services
can be terminated without notice whenever there is no vacancy against which he can be
retained. Now, with this background, let us consider the law laid down by this Court with
regard to power of the Government in abolishing temporary/permanent post.

i) M. Ramanatha Pillai v. The State of Kerala and Another, (1973) 2 SCC 650, a
Constitution Bench of this Court held as under: AIR 1973 SC 2641

"23. A post may be abolished in good faith. The order abolishing the post may lose its
effective character if it is established to have been made arbitrarily, mala fide or as a
mask of some penal action within the meaning of Article 311(2)."

ii) Shri Kedar Nath Bahl v. The State of Punjab and Others, (1974) 3 SCC 21, a three-
Judge Bench of this Court held in para 11 as under: AIR 1972 SC 873
"... ... ....If, in the interest of the Administration, the temporary post is abolished, the
question as to what were the personal relations between the appellant and his superiors
was irrelevant. Moreover, all that the appellant has been able to say is that his immediate
superiors in the Department were hostile to him. But here we are concerned not with the
action of his immediate superiors but the action of the Government. The decision to
discontinue the post was the decision of the Government and it is not alleged in the Writ
Petition that in taking this decision the Government acted mala fide. We, therefore, agree
with the High Court that there is no substance in the allegation that the post was
discontinued or abolished in order to punish the appellant."

iii) State of Haryana v. Shri Des Raj Sangar and Another, (1976) 2 SCC 844, this Court,
in para 8, has held: AIR 1976 SC 1199, Para 7

@page-SC420
"... ... ... The fact that the post to be abolished is held by a person who is confirmed in that
post and the post which is not abolished is held by a person who is not permanent would
not affect the legality of the decision to abolish the former post as long as the decision to
abolish the post is taken in good faith.

iv) Dr. N.C. Singhal v. Union of India and Others, (1980) 3 SCC 29. Similar issue was
considered in detail. Accepting the stand of the Government of India in abolishing the
post, this Court held thus: AIR 1980 SC 1255

"18. . ... ... ... The need for the post of the requirements of the hospital, or the need for an
ad hoc or additional appointment is a matter which the Government is competent to
decide and in the absence of requisite material the Court cannot interpose its own
decision on the necessity of creation or abolition of posts. Whether a particular post is
necessary is a matter depending upon the exigencies of the situation and administrative
necessity. The Government is a better Judge of the interests of the general public for
whose service the hospitals are set up. And whether a hospital catering to the needs of
general public providing medical relief in different specialities has need for a particular
post in a particular speciality would be better judged by the Government running the
hospital. If Government is a better judge it must have the power to create or abolish the
posts depending upon the needs of the hospital and the requirements of general public.
Creation and abolition of posts is a matter of Government policy and every sovereign
Government has this power in the interest and necessity of internal administration. The
creation or abolition of post is dictated by policy decision, exigencies of circumstances
and administrative necessity. The creation, the continuance and the abolition of post are
all decided by the Government in the interest of administration and general public (see
M.Ram-anatha Pillai v. State of Kerala.) [1974] 1 S.C.R. 515 at 520. The Court would be
the least competent in the face of scanty material to decide whether the Government acted
honestly in creating a post or refusing to create a post or its decision suffers from mala
fide, legal or factual." AIR 1973 SC 2641
v) In the recent decision - Avas Vikas Sansthan and Another v. Avas Vikas Sansthan
Engineers Assn. and Others, (2006) 4 SCC 132, analyzing all earlier decisions, this Court
has concluded:2006 AIR SCW 1797, Para 56

"59. It is well settled that the power to abolish a post which may result in the holder
thereof ceasing to be a Government Servant has got to be recognized. The measure of
economy and the need for streamlining the administration to make it more efficient may
induce any State Government to make alterations in the staffing pattern of the civil
services necessitating either the increase or the decrease in the number of posts or abolish
the post. In such an event, a Department which was abolished or abandoned wholly or
partially for want of funds, the Court cannot, by a writ of mandamus, direct the employer
to continue employing such employees as have been dislodged."
11. We summarize the power of government in abolishing a post and role of the court for
interference:
a) the power to create or abolish a post rests with the government;
b) whether a particular post is necessary is a matter depending upon the exigencies of the
situation and administrative necessity;
c) creation and abolition of posts is a matter of government policy and every sovereign
government has this power in the interest and necessity of internal administration;
d) creation, continuance and abolition of posts are all decided by the government in the
interest of administration and general public;
e) the court would be the least competent in the face of scanty material to decide whether
the government acted honestly in creating a post or refusing to create a post or its
decision suffers from mala fide, legal or factual;
f) as long as the decision to abolish the post is taken in good faith in the absence of
material, interference by the court is not warranted.
12. With the above principles, let us consider whether the abolition of the posts of
Accounts Executives are justified and consequential order of termination terminating the
respondent-herein from the said post is sustainable.
13. The main grievance of the respondent herein was that since he was also
@page-SC421
equally qualified as that of Financial Adviser, appellant No.3 herein, she was not in
favour of continuing him in HBPE as Accounts Executive. The other grievance was that
appellant No.3 used to humiliate by insulting him. According to him, instead of taking
any action against him under the service Rules, his services have been dispensed with by
abolishing the post of Accounts Executive. In other words, it is his specific case that the
abolition of post of Accounts Executive was done with a mala fide intention to dispense
with his service without any basis. The materials placed before the High Court as well as
this Court show that HBPE as well as the Financial Adviser denied those allegations. In
the light of the complaint, allegations and counter allegations, we verified the relevant
records which are available in the paper book. The first complaint (Annexure R1) dated
15.09.1993 shows that there was some misunderstanding between the Accounts
Executive and Financial Adviser, however, scrutiny of the said complaint clearly shows
that only Personal Assistant to Financial Adviser was responsible for the alleged
misbehaviour. In the complaint, Accounts Executive has specifically stated, The P.A.
attached to the F.A. grossly misbehaves and uses foul and abusive language on the
instigation of the F.A. We also perused the letter of the Member Secretary, HBPE dated
21.09.1993 addressed to the Accounts Executive and subsequent correspondence which
are available in the appeal paper book. As observed earlier, though certain
misunderstanding arose between the Accounts Executive and the Financial Adviser, it is
impossible to believe that for this reason the Government abolished the post of Accounts
Executive and consequently terminated the service of the respondent herein.
14. Learned senior counsel appearing for the appellants, by placing relevant materials,
submitted that taking note of lesser activities of HBPE and after assessing the work load
as well as sanctioned staff and after full deliberations by responsible officers, it was
recommended to the Government for abolition of two posts of Accounts Executives. On
accepting the recommendations of the Committee constituted by HBPE, the Government
passed an order according sanction to abolish two temporary posts of Accounts
Executives sanctioned for HBPE from 31.12.1994 (A/N) vide order dated 30.12.1994
(Annexure R-13). The said Government Order was issued in the name of Governor of
Haryana and with the concurrence of Finance Department. Based on the said decision of
the Government and in view of Condition No.2 of the appointment letter of the
respondent bearing No. 2/8/88-Estt-1 dated 13.07.1993, his services has been terminated
from 31.12.1994 (AN). In paragraph supra, we already referred to Condition No.2 of the
appointment order which makes it clear that the appointment of the respondent was fully
against temporary post and the same is liable to be abolished at any time and without
notice. In such circumstances, we are unable to accept the claim of the respondent that
there was no bona fide in terminating his service and the High Court has committed an
error in accepting the said claim.
15. It is also relevant to point out that by office order dated 05.08.1994 HBPE has
earmarked various types of works/subjects to be handled by Financial Adviser, 3rd
appellant herein, and Accounts Executive, respondent herein. A perusal of the said office
order, filed as Annexure R-7 in the appeal paper book, clearly demarcates various types
of work to be handled by the Financial Advisor and the Accounts Executive. Learned
senior counsel appearing for the appellants has also brought to our notice various minutes
of the meetings and the ultimate decision by HBPE for pruning their staff considering
less work load and present position of the staff sanctioned. Proceedings dated 12.01.1994
(Annexure R-3) shows that in order to assess the work load and present position of the
staff sanctioned for the HBPE a meeting of the officers of the Bureau was held by the
Chairman, HBPE on 11.09.1994 in which the Member Secretary, Personnel Adviser,
Financial Adviser and Assistant Research Officer of HBPE were participated. In the said
meeting, the Chairman felt that the work of the Bureau was not being performed as per its
mandate and suggested some restructuring of staff vis-a-vis the workload of the Bureau.
He further observed that when there are three professional posts to handle the financial
affairs, Management Affairs and Personnel Affairs of all the State Public Enterprises then
there was no necessity of having two posts of Accounts Executives having the similar
qualifications and experience as the Financial Adviser. It was also suggested that in the
next officers level meeting, the complete restructuring of
@page-SC422
staff vis-a-vis officers oriented nature of work of the Bureau and sanctioned staff may be
put up with details. Thereafter on 11.04.1994 (Annexure R-4), a meeting was held. The
minutes of the meeting shows that the details of the sanctioned staff, work load and re-
structuring was discussed in detail. It further shows that the instructions on economy in
expenditure issued by the State Government from time to time were also brought to the
notice of the Chairman for which he desired that these should also be made applicable for
the staff of the Bureau. The Chairman had also made clear that the Bureau should not
have excess staff as compared to the work load. In the said meeting while assessing the
work load and staff in the Financial Wing, it was observed that the contribution of two
posts of Accounts Executives especially when there are two posts of Accountants was not
result oriented and the work can smoothly be carried on even without the two posts of
Accounts Executives. The Chairman desired that MS/HBPE should assess the work load
and the staff strength of Finance and Accounts Wing and discuss in detail in the next
officers level meeting. It is also relevant to point out that before taking final decision; the
respondent herein by letter dated 26.07.1994 made a complaint to Hon'ble the Chief
Minister of Haryana about his difficulty in working as an Accounts Executive with HBPE
which is annexed as Annexure R-5. The complaint makes it clear that the Accounts
Executive had some grievance against the Member Secretary and the Financial Advisor
regarding the distribution of work. Further materials placed show that on the basis of the
complaint, a preliminary enquiry was conducted and ultimately no action was taken
based on the same. Finally, as stated earlier, after getting all the required details regarding
the work load and sanctioned staff of HBPE and on the basis of the report of the
Committee, a decision was taken by the Chairman that there was no requirement for two
posts of Accounts Executives and can be abolished without affecting the work of the
Bureau. Based on the said decision, the Government while accepting the same accorded
sanction to abolish two temporary posts of Accounts Executives sanctioned earlier. In
those circumstances, it is impossible to accept the stand of the respondent herein that the
posts of Account Executives were abolished in order to terminate him from the said
service. We are of the view that the High Court has committed an error in accepting the
claim of the respondent herein.
16. Rejoinder affidavit filed on behalf of the HBPE before this Court clearly shows the
various steps taken by the Committee and the ultimate decision of the Chairman for
reduction of the staff strength. It is specifically stated in the reply that in accordance with
the instructions of the Government, the requirement of posts for HBPE has been reviewed
from time to time and various posts have been abolished even after the decision to
abolish two posts of Accounts Executives. The information about the abolition of the
various posts given in the rejoinder affidavit dated 20.07.2005 is relevant which reads as
under:

S.No. Name of the Post No. of posts Date of abolition


1. Accounts Executive 2 31.12.1994
2. Senior Research Officer 1 29.6.1999
3. Assistant Research Officer 1 28.8.2000
4. Asstt. District Attorney 1 1.3.2000
5. Computer Operator 1 1.6.2001
6. JSS/Steno Typist 4 31.12.94/22.10.2001
7. Clerk 1 22.10.2001
8. Peon 4 31.12.94/22.10.2001
9. Personnel Advisor 1 14.5.2004
10. Accountant 1 14.5.2004

@page-SC423
It is clear from the materials placed in the rejoinder affidavit that the Government of
Haryana has been making earnest efforts to control its non-planned expenditure. The
rejoinder affidavit also shows that due to various efforts including the action taken by the
HBPE non-planned expenditure has been substantially reduced. In the light of the
particulars furnished, we are of the opinion that the decision to abolish the posts of
Accounts Executives was taken on the basis of the overall assessment of the work load
and staff requirement of the Bureau and the same was finally approved and sanctioned by
the Government and consequent to the said decision, the service of the respondent herein
was terminated. We hold that the entire action was taken in good faith and there is no
substantial material to arrive at a conclusion that the abolition of the post was due to
revenge against the respondent herein.
17. In the light of the above discussion, we are unable to accept the conclusion arrived at
by the High Court and we are in agreement with the decision taken by the Bureau and the
Government. Consequently, the orders passed by the High Court in L.P.A. No. 163 of
1999 dated 16.03.2004 and in C.W.P. No. 442 of 1995 dated 29.01.1999 are set aside. The
appeal is, accordingly, allowed. There shall be no order as to costs.
Appeal allowed.
AIR 2008 SUPREME COURT 423 "I. Laxma Reddy v. A. P. S. R. T. C."
(From : Andhra Pradesh)*
Coram : 2 Dr. A. PASAYAT AND P. SATHASIVAM, JJ.
Civil Appeal No. 4511 of 2005, D/- 22 -11 -2007.
I. Laxma Reddy v. A. P. S. R. T. C. and Ors.
Industrial Disputes Act (14 of 1947), Sch.2, Item 6 - INDUSTRIAL DISPUTE -
REINSTATEMENT - Reinstatement in service - Refixation of pay - National increments
earned during period of his absence - Cannot be take into consideration.
2003 (2) SCC 212, 2005 AIR SCW 3809, Rel. on. (Paras 6, 7)
Cases Referred : Chronological Paras
2005 AIR SCW 3809 : AIR 2005 SC 3791 (Rel. on) 7
(2003) 2 SCC 212 (Rel. on.) 3, 6, 7
2001 (4) Andh LD 568 2, 3
V. Sridhar Reddy and Abhijit Sengupta for Appellant; D. Mahesh Babu for Respondents.
* W. A. No. 1092 of 2003, D/- 10-7-2003 (AP).
Judgement
Dr. ARIJIT PASAYAT, J. :- Challenge in this appeal is to the order passed by a Division
Bench of the Andhra Pradesh High Court allowing the writ appeal filed by the
respondent-Andhra Pradesh State Road Transport Corporation (in short the Corporation)
and its functionaries.
2. A writ petition was filed by the appellant claiming that since an award was passed by
the Labour Court directing his re-instatement, his pay has to be fixed after taking into
consideration the notional increments. Learned Single Judge relied on a Division Bench's
decision in APSRTC Khammam Region and Anr. v. P. Nageswara Rao (2001 (4) ALD
568 (DB)) and allowed the writ petition.
3. Present respondents filed a writ appeal before the High Court questioning correctness
of the judgment. The High Court noticed that the view expressed by the Division Bench
in P. Nageswara Rao's case (supra) was dis-approved by this Court in A.P.S.R.T.C. v. S.
Narsagoud (2003 (2) SCC 212) and, therefore, allowed the writ appeal directing dismissal
of the writ petition.
4. In support of the appeal, learned counsel for the appellant submitted that when an order
of re-instatement is passed for all practical purposes there will be continuity in service
and, when the re-instatement is done the pay has to be fixed after taking into
consideration the notional increments which would have otherwise accrued.
5. Learned counsel for the respondents on the other hand supported the order passed by
the High Court.
6. The principles of law on the point are no more res integra. This Court in S.
Narsagoud's case (supra) succinctly crystallized principle of law in para 9 of the
judgment :
"We find merit in the submission so made. There is a difference between an order of
reinstatement accompanied by a simple direction for continuity of service and a direction
where reinstatement is accompanied by a specific direction that the employee shall be
entitled to all the consequential benefits, which necessarily flow from reinstatement or
accompanied by a specific direction that
@page-SC424
the employee shall be entitled to the benefit of the increments earned during the period of
absence. In our opinion, the employee after having been held guilty of unauthorized
absence from duty cannot claim the benefit of increments notionally earned during the
period of unauthorized absence in the absence of a specific direction in that regard and
merely because he has been directed to be reinstated with the benefit of continuity in
service.
7

. The position was re-iterated in A.P. State Road Transport Corporation and Ors. v. Abdul
Kareem (2005 (6) SCC 36). In view of what has been stated by this Court in S.
Narsagoud and Abdul Kareem cases (supra), there is no merit in this appeal which is
accordingly dismissed. There will be no order as to costs. 2005 AIR SCW 3809

Appeal dismissed.
AIR 2008 SUPREME COURT 424 "P. J. Chacko v. Chairman, L.I.C. of India"
(From : Kerala)
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Civil Appeal No. 5322 of 2007 (arising out of SLP (C) No. 23951 of 2005), D/- 20 -11
-2007.
P. J. Chacko and Anr. v. Chairman, Life Insurance Corporation of India and Ors.
(A) Insurance Act (4 of 1938), S.45 - INSURANCE - CONTRACT - Insurance policy -
Repudiation - Deliberate wrong answer given by insured having a great bearing on
contract of insurance - Policy may be repudiated.
Contract Act (9 of 1872), S.126.
A deliberate wrong answer which has a great bearing on the contract of insurance, if
discovered, may lead to the policy being vitiated in law. The purpose for taking a policy
of insurance is not very material. It may serve the purpose of social security but then the
same should not be obtained with a fraudulent act by the insured. Proposal can be
repudiated if a fraudulent act is discovered. The proposer must show that his intention
was bona fide. It must appear from the face of record. (Para 16)
In a case where insured although had in fact undergone an operation for Adenoma
thyroid, in the application form for obtaining policy answer 'no' was given to the
question whether insured had been operated, the insured died within 6 months of taking
policy and the policy was obtained through his brother who was an authorised agent of
L.I.C., it was not necessary for the insurer to establish that the suppression was
fraudulently made by the policy holder or that he must have been aware at the time of
making the statement that the same was false or that the fact was suppressed which was
material to disclose. The repudiation of policy was held proper. (Paras 16, 21)
It is true that Life Insurance Corporation being a State within the meaning of Aricle 12 of
the Constitution of India, its action must be fair, just and equitable but the same would
not mean that it shall be asked to make a charity of public money, although the contract
of insurance is found to be vitiated by reason of an act of the insured. (Para 20)
(B) Evidence Act (1 of 1872), S.115 - ESTOPPEL - CONTRACT - INSURANCE -
Estoppel - Contract of life insurance - Person making a wrong statement with knowledge
of consequence therefor - Estopped from pleading that even if such a fact had been
disclosed, it would not have made any material change.
Insurance Act (4 of 1938), Pre. (Para 15)
Cases Referred : Chronological Paras
2001 AIR SCW 161 : AIR 2001 SC 549 (Disting.) 21
AIR 1962 SC 814 9, 13
AIR 1960 Mad 484 (Disting. and Explan.) 8, 17, 19
AIR 1959 Pat 413 24
AIR 1938 Cal 641 22
R. Sathish, for Appellants; Paramjit Singh Patwalia, Sr. Advocate, S. Rajappa, for
Respondents.
Judgement
S. B. SINHA, J. :- Leave granted.
2. Application of Section 45 of the Insurance Act, 1938 is in question in this appeal which
arises out of a judgment and order dated 17th December, 2004 passed by a Division
Bench of the High Court of Kerala at Ernakulam in A.F.A. No. 18 of 2000 setting aside
the judgment and order of a learned Single Judge dated 23rd September, 2000 passed in
Appeal Suit No.633 of 1993 confirming the judgment and decree passed by the
Subordinate Judge of Kozhikode in OS No. 240 of 1990 dated 27th February, 1993.
@page-SC425
3. Plaintiffs in the suit are the appellants herein. They filed the said suit inter alia for
recovery of the amount of insurance on the death of one Chackochan (hereinafter referred
to as 'the insured'). The insured took an insurance policy on 21st February, 1987. He
died on 6th July, 1987. On his death, the appellants herein claimed the insured amount.
On the premise that the insured suppressed material facts, the policy had been repudiated
by the respondent on 10th February, 1989. Non-disclosure and mis-statement in the
proposal form to the various questions to which answers were given by the insured is said
to be the reason for the aforementioned repudiation of the contract of insurance.
4. It now stands admitted that the insured had undergone an operation for Adenoma
Thyroid. The particulars furnished by him while filling up the application form for
obtaining the said policy were as under :-
(a) Did you ever have any operation, accident or injury? The answer was "No". (b)
Have your remained absent from place of your work on ground of health during the last 5
years ? To which answer was "No". (c) What has been your state of health? The answer
was good.
The fact that the said answers were incorrect is not in dispute. The suit filed by the
appellants, however, was decreed.
5. On an appeal preferred by the respondents, on the premise that despite such wrong
answers, as the injured died on account of "polyneuritis", a learned Single Judge of the
High Court opined that there was nothing to indicate that if the injured had disclosed the
factum of previous operation, the appellant-Corporation might not have inclined to insure
and insisted on a higher premium and thus there was no material to show that the non-
disclosure was of a material fact justifying repudiation of the policy by the Corporation.
6. On an intra court appeal, the Division Bench of the High Court, however, by reason of
the impugned judgment opined that the parties are bound by the warranty clause
contained in the agreement which is also clear from the declaration signed by the insured
and the non-disclosure related to a material fact which was required to be answered
correctly under question No.22(a).
7. Mr. R. Sathish, learned counsel appearing on behalf of the appellants would submit
that a clear finding of fact having been arrived at by the trial court that despite
undergoing Adenoma Thyroid operation four years prior to the date of proposal of policy,
the cause of insured's death being 'polyneuritis' which had no connection with the
operation and the judgment of the trial court having been affirmed by the learned Single
Judge, should not have been interfered with by the Division Bench. Our attention was
further drawn to the fact that the medical officer had noted a black mole on lower aspect
of left side of neck and from Ext. A1 wherefrom it appeared that there had been no past
history suggestive of allergies, injuries, operations, diseases like rheumatic fever, syphilis
etc. and the deceased having no other complaint due to operation, the impugned judgment
cannot be sustained.
8. Life Insurance policy, it was submitted is a requirement of social security. In that view
of the matter, a suppression could not have been led to repudiation of policy, particularly
when the doctor who examined the insured was appointed by the respondent-Corporation
itself. Our attention in this behalf has been drawn to the decision of the Madras High
Court in All India General Insurance Co. Ltd. and another v. S.P. Maheshwari : AIR
1960 Madras 484 for the proposition that there exists a distinction between a
'representation' and a 'warranty'.
9

. Mr. Patwalia, learned Senior Counsel, appearing on behalf of the respondents, on the
other hand, submitted that having regard to the provisions contained in Section 45 of the
Insurance Act and the policy having been repudiated within a period of 2 years, the
impugned judgment should not be interfered with. It was submitted that undergoing of an
operation having a direct nexus with the health of the insured, suppression thereof has
rightly been considered with all seriousness by the Corporation. It was argued that the
operation underwent by the insured being a major one, was a material fact which ought to
have been disclosed. Not only the insured had given wrong answers to the questions, his
brother himself being a Life Insurance Corporation's agent and furthermore in view of the
fact that a declaration was given by the insured that no untrue averment was made
therein, the contract of insurance was null and void and all monies which had been paid
in respect thereof would stand forfeited to the AIR 1962 SC 814

@page-SC426
Corporation. Learned counsel for the Corporation has placed strong reliance on Mithoolal
Nayak v. Life Insurance Corporation of India : 1962 Suppl (2) SCR 571.
10. The basic fact of the matter is not in dispute. The insured had undergone an operation
for Adenoma Thyroid. It was a major operation. Although the said operation was
undergone by him four years prior to the date of the proposal made by him, he did not
disclose thereabout prior to obtaining the insurance policy. We may notice that he died
within six months from the date of taking of the policy i.e. on 6th July, 1987, policy
having taken on 21st February, 1987.
11. Section 45 of the Insurance Act reads as under :-
45. Policy not to be called in question on ground of mis-statement after two years,-
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 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 :
Provided that nothing in this section shall prevent the insurer from calling for proof of
age at any time if he is entitled to do so, and no policy shall be deemed to be called in
question merely because the terms of the policy are adjusted on subsequent proof that the
age of the life insured was incorrectly stated in the proposal.
12. Section 45 postulates repudiation of such policy within a period of two years. By
reason of the aforementioned provision, a period of limitation of two years had, thus,
been specified and on the expiry thereof the policy was not capable of being called in
question, inter alia on the ground that certain facts have been suppressed which were
material to disclose or that it was fraudulently been made by the policy holder or that the
policy holder knew at the time of making it that the statement was false. Statute,
therefore, itself provides for the limitation for valid repudiation of an insurance policy. It
takes into account the social security aspect of the matter
13. There are three conditions for application of second part of Section 45 of the
Insurance Act which 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.

[See Mithoolal Nayak (supra)] AIR 1962 SC 814

14. The insured's brother was an agent of the Life Corporation of India. It was he, who
had asked the insured to take the insurance policy. He, being an authorized agent of the
Life Insurance Corporation, presumably knew the effect of misstatement of facts.
Misstatement by itself, however, was not material for repudiation of the policy unless the
same is material in nature.
15. The insured furthermore was aware of the consequence of making a misstatement of
fact. If a person makes a wrong statement with knowledge of consequence therefor, he
would ordinarily be estopped from pleading that even if such a fact had been disclosed, it
would not have made any material change.
16. The purpose for taking a policy of insurance is not, in our opinion, very material. It
may serve the purpose of social security but then the same should not be obtained with a
fraudulent act by the insured. Proposal can be repudiated if a fraudulent act is discovered.
The proposer must show that his intention was bona fide. It must appear from the face of
the record. In a case of this nature it was not necessary for the insurer to establish that the
suppression was fraudulently made by the policy holder or that he must have been aware
at the time of making the statement that the same was false or that the fact was
suppressed which was material to disclose. A deliberate wrong answer which has a great
bearing on the
@page-SC427
contract of insurance, if discovered may lead to the police being vitiated in law.
17

. It is no doubt true that there exists a distinction between a 'representation' and a


'warranty'. A Division Bench of the Madras High Court in S.P. Maheshwari (supra) upon
taking into consideration the history of insurance laws in United States of America, in
England and in India stated :- AIR 1962 SC 814

"(10) One great principle of insurance law is that a contract of insurance is based upon
utmost good faith Uberrima fides; in fact it is the fundamental basis upon which all
contracts of insurance are made. In this respect there is no difference between one
contract of insurance and another. Whether it be life or fire or marine the understanding is
that the contract is uberrima fides and though there may be certain circumstances from
the peculiar nature of marine insurance which require to be disclosed, and which do not
apply to other contracts of insurance, that is rather an illustration of the application of the
principle than a distinction in principle. From the very fact that the contract involves a
risk and that it purports to shift the risk from one party to the other, each one is required
to be absolutely innocent of every circumstance which goes to influence the judgment of
the other while entering into the transaction."
18. While the parties entered into a contract of insurance the same shall, subject to
statutory interdict, be governed by the ordinary law of contract. The insurer may not rely
upon the disclosures made by the insured. It may gather information from other sources.
The Madras High Court, although in our opinion, has rightly issued a note of caution to
construe a representation and warranty as a general proposition which may operate
harshly against the policy holders, itself noticed :-
"(12) The principles underlying the doctrine of disclosure and the rule of good faith
oblige the proposer to answer every question put to him with complete honesty. Honesty
implies truthfulness. But it happens that no man can do more than say what he believes to
be the truth."
19. Whether in a given case the court should take judicial notice of practice followed in
such cases or not would depend upon the facts and circumstances of each case. If it is
found that the agent himself was interested in getting the policy executed by the Life
Insurance Corporation, such common knowledge takes a back seat.

In S.P. Maheshwari (supra), it was stated : AIR 1960 SC 484

"(27) This brings us on finally to the topics of non-disclosure or misrepresentation which


are practically the positive and negative aspects of the same thing. The effect of
misrepresentation on the contract is precisely the same as that of non-disclosure; it
affords the aggrieved party a ground for avoiding the contract. There are a number of
dicta and one decision to the effect that life insurance is an exception to the general rule
that innocent misrepresentation may afford grounds for avoiding a policy and that the
misrepresentation must be fraudulent to have this effect upon a policy of life insurance.
But in order to give the insurer grounds for avoidance both under non-disclosure as well
as misrepresentations, both must relate only to material information."
The said decision, therefore, is of no assistance to the appellants herein.
20. We are not unmindful of the fact that Life Insurance Corporation being a State within
the meaning of Article 12 of the Constitution of India, its action must be fair, just and
equitable but the same would not mean that it shall be asked to make a charity of public
money, although the contract of insurance is found to be vitiated by reason of an act of
the insured. This is not a case where the contract of insurance or a clause thereof is
unreasonable, unfair or irrational which could make the court carried the bargaining
powers of the contracting parties. It is also not the case of the appellants that in framing
the aforesaid questionnaire in the application/proposal form, the respondents had acted
unjustifiably or the conditions imposed are unconstitutional.
21

. In Life Insurance Corpn. Of India and Ors. v. Asha Goel (Smt) and Anr. [(2001) SCC
160], whereupon reliance has been placed by Mr. Sathish, it was held : 2001 AIR
SCW 161, (Para 12)

The contracts of insurance including the contract of life assurance are contracts uberrima
fides and every fact of material (sic material fact) must be disclosed, otherwise, there is
good ground for rescission of the contract. The duty to disclose material facts continues
right up to the conclusion of the
@page-SC428
contract and also implies any material alteration in the character of the risk which may
take place between the proposal and its acceptance. If there are any misstatements or
suppression of material facts, the policy can be called into question. For determination of
the question whether there has been suppression of any material facts it may be necessary
to also examine whether the suppression relates to a fact which is in the exclusive
knowledge of the person intending to take the policy and it could not be ascertained by
reasonable enquiry by a prudent person.
It has not been shown in this case that repudiation of the contract of insurance was not
done by the respondent with extreme care and caution or was otherwise invalid in law.
The Division Bench of the High Court has taken all the aspects of the matter in
consideration and, in our opinion arrived at a just decision.
22. Strong reliance has been placed by the learned counsel for the appellants on Allianz
Und Stuttgarter Life Insurance Bank Ltd. v. Hemanta Kumar Das [AIR 1938 Cal 641]
wherein in regard to some purported statements made by the proposor in regard to his age
was not found to be material as would appear from the following :
It is to be borne in mind that this was an insurance by a man who admittedly was, at any
rate, at the age of over forty-five years. He himself stated that he was fifty four.
Therefore, the transaction came within the category of those proposals which require at
the outset the furnishing by the "proponents" of proof of their age. Noot Behari Das was
required to furnish proof of his age. He produced a horoscope. The horoscope was
accepted by the company as being sufficient. Therefore, we may take that the company
issued the policy upon the footing that they were insuring the life of a man whose age
was fifty four. This is not a case where the proposer says that his age was fifty four and
the Company merely accepted that statement at its face value and proceeded to issue a
policy on that footing and subsequently, either shortly afterwards or a long time
afterwards, admitted the age as stated in the policy in accordance with the provisions of
Cl.9(2) thereof. This was a case where the whole transaction from the very beginning
proceeded upon the basis that the company had satisfied themselves that the proposer was
of the age of fifty four and then issued the policy accordingly. In my view therefore the
admission contained in the endorsement at page 3 of the policy is of such a character that
the defendants when the policy matured could not be heard to say that the age of the
insured was anything different from what he himself had stated it to be in February 1934.
It is not necessary that one should apply in terms of the principle of estoppel, because that
is merely a rule of evidence. In my view, this matter goes far deeper than that. The
question of the age of the deceased was a definite and determining factor in the
transaction from the very outset.
23. It is not a case where the company had further enquired into the matter in regard to
the question as to whether the proposor was operated upon or not.
24. In Ratan Lal and Anr. v. Metropolitan Insurance Co. Ltd. [AIR 1959 Pat 413], a
distinction was made between as to what is material and what is not material. In regard
to the disclosure of facts in that case itself, it was opined :
The well-settled law in the field of insurance is that contracts of insurance including the
contracts of life assurance are contracts uberrima fides and every fact of materiality must
be disclosed otherwise there is good ground for rescission. And this duty to disclose
continues up to the conclusion of the contract and covers any material alteration in the
character of the risk which may take place between proposal and acceptance.
25. Ratio of the said decision, therefore, instead of assisting the case of appellants, runs
counter to his contention.
26. Keeping in view the facts and circumstances of the case, we are of the opinion that no
case has been made out for our interference with the impugned judgment. The appeal
fails and is accordingly dismissed. No costs.
Appeal dismissed.
@page-SC429
AIR 2008 SUPREME COURT 429 "Manohar Shankar Nale v. Jaipalsing Shivlalsing
Rajput"
(From : Bombay)
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Civil Appeal No. 5323 of 2007 (arising out of SLP (C) No. 25959 of 2005), D/- 20 -11
-2007.
Manohar Shankar Nale and Ors. v. Jaipalsing Shivlalsing Rajput and Ors.
(A) Civil P.C. (5 of 1908), S.114, O.47, R.1 - REVIEW - DOCTRINES - Review -
Doctrine of merger - Does not apply when review petition is dismissed.
Where a review petition is dismissed, the doctrine of merger will have no application
whatsoever. It is one thing to say that the judgment debtor was entitled to file an
application for review in terms of S. 114 read with O. 47, R. 1 of Civil P.C. but it is
another thing to say that the decree passed in favour of the decree holder merged with the
order dismissing the review application. Matter might have been different, if the review
application had been allowed either wholly or in part in terms whereof an application for
execution of the decree could have been filed only in terms of the modified decree.
(Para 11)
(B) Civil P.C. (5 of 1908), O.21, R.35, O.47, R.1 - EXECUTION - LIMITATION -
POSSESSION - APPEAL - Execution - Limitation - Decree for possession and mesne
profits - Review petition against, dismissed - Appeal to S. C. against dismissal of review
petition - Stay granted by S. C. to order dismissing review petition - Does not bar
execution of decree - Further direction given by S. C. that computation of mesne profit
would go on and the same would be deposited by the appellant - Does not have effect of
staying operation of decree - Neither order of dismissal of review petition nor stay
granted by S. C. to that order have effect of postponing starting point of limitation or
execution.
Limitation Act (36 of 1963), Art.136.
W. P. No. 5927 of 2004, D/- 26-7-2005 (Bom), Reversed. (Paras 11, 15, 16, 17)
(C) Civil P.C. (5 of 1908), S.2(2) - DECREE - POSSESSION - Decree - Composite
decree - Decree for possession and for computation of mesne profits - Not composite
decree. (Para 10)
Cases Referred : Chronological Paras
2007 AIR SCW 1011 : AIR 2007 SC 1077 (Ref.) 13
2006 AIR SCW 6446 : 2007 CLC 3 (Ref.) 14
2005 AIR SCW 1381 : AIR 2005 SC 1944 (Disting) 17
1999 AIR SCW 3401 : AIR 1999 SC 3421 (Ref.) 13
AIR 1923 Cal 288 (Ref.) 7
Satyajit A. Desai, Mrs. Anangha S. Desai, Amol N. Suryawanshi and Venkateswara Rao
Anumolu for Appellants; Makarand D. Adkar, Vijay Kumar and Vishwajit Singh for
Respondents.
Judgement
S. B. SINHA, J. :- Leave granted.
2. Applicability of the provisions of Article 136 as contained in the Schedule appended to
the Limitation Act, 1963 is in question in this appeal which arises out of a judgment and
order dated 26.7.2005 passed by a learned Single Judge of the Bombay High Court,
Nagpur Bench at Nagpur in Writ Petition No. 5927 of 2004 affirming an order dated
26.10.2004 passed by the Civil Judge, Junior Division in Regular Darkhast No. 32 of
2001.
3. Shivlalsing, predecessor-in-interest of the respondents filed a suit in the Court of Civil
Judge, Junior Division, Malkapur. The said suit was marked as Regular Civil Suit No.
250/1965. It was dismissed on 24.12.1968. An appeal preferred thereagainst was also
dismissed. However, a second appeal filed by the plaintiff-decree holder was allowed
upon setting aside the judgment and decree of the Courts below, the operative portion
whereof reads as under :
"For the reasons stated in the accompanying judgment, the court allows the appeal, sets
aside the decrees of both the courts below dismissing the suit and instead. The Court
orders that the plaintiffs suit for possession of 32 gunthas area, as shown in the copy of
the map Exh. 30, from out of Survey No. 59/1 area 3 acres 12 gunthas, shall stand
decreed with costs throughout. The appellant-plaintiff is also entitled to an enquiry under
the provisions of the Order XX Rule 12(1) C.P.C. for mesne profit in respect of the suit
land from the date of the suit till the actual delivery of possession.
4. An application for review thereof was filed by the predecessor-in-interest of the
appellants herein. The said review petition was dismissed by an Order dated 12.8.1985.
Appellants preferred a special leave petition thereagainst before this Court and leave
having been granted, the matter was marked
@page-SC430
as Civil Appeal No. 1836 of 1986.
5. By an Order dated 21.3.1988, this Court passed an order of stay in the following
terms :
The Application for Stay above mentioned being called on for hearing before this Court
on the 21st day of March, 1988 upon hearing Counsel for the parties herein. This Court
Doth Order that the order of this Court dated the 8th May, 1986 passed in Civil
Miscellaneous Petition No. 10447 of 1986 be and is hereby confirmed and that pending
the hearing and final disposal by this Court of the appeal above mentioned, the operation
of the Order dated the 1st July, 1985 of the High Court of Judicature at Bombay (Nagpur
Bench) Nagpur in Miscellaneous Civil Application No. 134 of 1984 in Second Appeal
No. 158 of 1972 be and is hereby stayed and the Civil Judge, Junior Division, Malkapur,
Maharashtra be and is hereby directed to ascertain the amount of mesne profits which
shall be deposited by the appellant herein.
6. The said appeal, however, came to be dismissed as being incompetent by this Court
opining that no appeal lay in terms of Order 47 Rule 7 of the Code of Civil Procedure
rejecting a review application.
7. Admittedly, an application for executing the said decree was filed by the decree holder
only on 10.12.2001. Appellant, having been noticed in the said execution proceeding,
inter alia, raised a contention about maintainability thereof on the premise that the same
was barred by limitation. The Executing Court by an Order dated 26.10.2004 rejected the
said contention holding :
"It is only a disputed point as to whether the decree was stayed by Hon'ble Apex Court. If
it was stayed, the Darkhast would be within limitation and if not, it would not be Record
of original darkhast is called for copy of writ in respect of stay is on the said record, from
Hon'ble Apex Court stayed the effect and operation of the order passed by Hon'ble High
Court while deciding review petition against the order passed in Second Appeal. It is
submitted by Shri Tarkase, learned counsel for the J.D. that the original decree was not
stayed. It is submitted by Shri Rawant, learned counsel for the D.H. that the said order
had the effect of staying the original decree as it merged into the orders passed by
Hon'ble High Court. I am in agreement with this submission of Shri Rawant. Shri
Tarkase, learned counsel for the J.D. placed his reliance on the decision in the case of
Ram Ratan Choudhary Vs- Upendra Chondru Das, A.I.R. 1923 Cal. 288. But, there was
to stay is that case (sic) and hence the ratio is not applicable to the facts of the present
case. Hence, there is no substance in the submission that the execution is not within
limitation. Hence, I hold that the execution is well within limitation as an order of stay to
the order of Hon'ble High Court was operating.
8. As noticed hereinbefore, a learned Single Judge of the Bombay High Court, Nagpur
Bench, Nagpur by reason of the impugned judgment dated 26.7.2005 dismissed the writ
petition preferred by the appellant thereagainst stating;
"The learned trial court while rejecting the application has found that the judgment and
decree dated 02/09/1983 had merged into the order of this Court while rejecting review
dated 01/07/1985. He, therefore, submits that the effect of the stay granted by the Apex
Court was to stay the execution of the decree and as such the execution of the decree
cannot be proceeded till vacation of the stay by the Apex Court. The execution of
proceedings have been filed within a period of 12 days from the date on which the Apex
Court had vacated the stay.
In that view of the matter, I do not find any perversity or infirmity in the jurisdiction
exercised by the learned trial court so as to warrant any interference of this court in the
extraordinary jurisdiction under Article 227 of the Constitution of India. Hence the
petition is rejected.
9. Mr. Satyajit A. Desai, learned counsel appearing on behalf of the appellant in support
of the appeal would submit that the learned Courts below acted illegally and without
jurisdiction in passing the impugned judgment insofar as they failed to take into
consideration that no order having been passed by this Court staying execution of the
proceedings or operation of the judgment and decree, the impugned judgment must be set
aside being wholly unsustainable in law.
Mr. Makarand D. Adkar, learned counsel appearing on behalf of the respondents, on the
other hand, would submit that a composite decree having been passed by the High Court
and furthermore in view of the fact that this Court in its order dated
@page-SC431
21.3.1988 clearly directed computation of mesne profit, the execution case was not
barred by limitation.
It was further submitted that the remedy of review being a statutory remedy available to
an aggrieved party, an Order passed in such proceedings would merge with the main
judgment and decree.
10. The decree passed by the High Court in the aforementioned Second Appeal No. 158
of 1972 is in two parts. The Court granted a decree for possession. In respect of an area
measuring 32 gunthas, as delineated in the map Exh. 30, out of Survey No. 59/1
measuring 3 acres 12 gunthas. Respondent was also found to be entitled to an enquiry in
terms of Order 20 Rule 12 of the Code of Civil Procedure in regard to computation of
mesne profit from the date of the institution of the suit, till the date of the actual delivery
of possession. It is therefore, not correct to contend that the decree was a composite one.
The proceeding for computation of mesne profit required to be undertaken in terms of
Order 20 Rule 12 of the Code of Civil Procedure was subject to institution of a
proceeding but, by reason thereof, the execution of the decree in regard to the possession
of 30 gunthas of land was not required to be awaited till the outcome.
11. It is also incorrect to contend that in a case of this nature, namely where a review
petition was dismissed, the doctrine of merger will have any application whatsoever.
It is one thing to say that the respondent was entitled to file an application for review in
terms of Section 114 read with Order 47 Rule 1 of the Code of Civil Procedure, but it is
another thing to say that the decree passed in favour of the respondent merged with the
order dismissing the review application. Matter might have been different, if the review
application had been allowed either wholly or in part in terms whereof an application for
execution of the decree could have been filed only in terms of the modified decree.
It is not the contention of the respondent that any order of stay was passed in the review
application. There was, thus, no bar in proceeding with the execution case.
12. Keeping in view the aforenoticed factual backdrop, we may notice the law applicable
herein.
Article 136 of the Limitation Act reads as under:

Description of application Period of limitation Time from which period


begins to run
136 For the execution of any decree (other than a decree granting a mandatory
injunction) or order of any civil Court. Twelve years When the decree or order be
comes enforceable or where the decree or any subsequent order directs any payment of
money or the delivery of any property to be made at a cer-tain date or at recurring
periods,when default in making the pay-ment or delivery in respect of which execution is
sought,takes place :
Provided that an application for the enforcement or execution of a decree granting a
perpetual injunction shall not be subject to any period of limitation.

13

. The decree of possession passed in favour of the respondent became enforceable


immediately on its passing. An execution petition therefor was required to be filed within
a period of 12 years. In W.B. Essential Commodities Supply Corpn. v Swadesh Agro
Farming and Storage Pvt. Ltd., 1999 AIR SCW 3401, Paras 8, 10 and 11)

@page-SC432
[(1999) 8 SCC 315], this Court opined;
"(1) A decree or order is said to be enforceable when it is executable. For a decree to be
executable, it must be in existence. A decree would be deemed to come into existence
immediately on the pronouncement of the judgment. But it is a fact of which judicial
notice may be taken of that drawing up and signing of the decree takes some time after
the pronouncement of the judgment; the Code of Civil Procedure itself enjoins that the
decree shall be drawn up expeditiously and in any case within 15 days from the date of
the judgment. If the decree were to bear the date when it is actually drawn up and signed
then that date will be incompatible with the date of the judgment. This incongruity is
taken care of by Order 20 Rule 7 CPC which, inter alia, provides that the decree shall
bear the date and the day on which the judgment was pronounced."
(2) "Rule 6-A enjoins that the last paragraph of the judgment shall state in precise terms
the relief which has been granted by such judgment. It has fixed the outer time-limit of 15
days from the date of pronouncement of the judgment within which the decree must be
drawn up. In the event of the decree not so drawn Rule 1 of Order 41 CPC without filing
a copy of the decree appealed against and for that purpose the last paragraph of the
judgment shall be treated as a decree. For the purpose of execution also, provision is
made in clause (b) of the said sub-rule which says that so long as the decree is not drawn
up, the last paragraph of the judgment shall be deemed to be a decree. Clause (b) has
thus enabled the party interested in executing the decree before it is drawn up to apply for
a copy of the last paragraph only, without being required to apply for a copy of the whole
of the judgment. It further lays down that the last paragraph of the judgment shall cease
to have the effect of the decree for purposes of execution or for any other purposes when
the decree has been drawn up."
(3) "It follows that the decree became enforceable the moment the judgment is delivered
and merely because there will be delay in drawing up of the decree, it cannot be said that
the decree is not enforceable till it is prepared. This is so because an enforceable decree
in one form or the other is available to a decree-holder from the date of the judgment till
the expiry of the period of limitation under Article 136 of the Limitation Act."

See also Hasham Abbas Sayyad Vs. Usman Abbas Sayyad and Ors. [(2007) 2 SCC 355]
2007 AIR SCW 1011

14

. In Raghunath Rai Bareja and Anr. v. Punjab National Bank And Others [(2006) 13
SCALE 511], this Court opined; 2006 AIR SCW 6446

"9. Under Article 136 to the Schedule of the Limitation Act, 1963 the period for applying
for execution of any decree is 12 years from the date when the decree becomes
enforceable. Since in the present case the final decree was passed and became
enforceable on 15.1.1987, the period of limitation for filing an execution application
expired on 15.1.1999".
15. The order of purported stay passed by this Court in terms of its Order dated 21.3.1988
is also of no assistance to the plaintiff-decree holder. The Special Leave Petition was
filed only against the Order dated 1.7.1985 refusing to review its judgment and decree
dated 2.9.1983. The stay of operation of the Order dated 1.7.1985 for all intent and
purport was meaningless as the review petition already stood dismissed.
16. Further direction of this Court that computation of mesne profit would go on and the
same would be deposited by the appellant is of no consequence inasmuch as by reason
thereof neither proceeding was stayed nor the operation of the judgment and decree had
been stayed. In fact, it was an order passed in favour of the decree holder. The said
direction did not come in his way to execute the decree for possession.
17. We, therefore, do not see any reason to hold that the said order could be construed to
be one passed in favour of the decree holder-respondent as was contended or otherwise.

Mr. Adkar relies upon the decision of this Court in Rekha Mukherjee v. Ashis Kumar Das
and Others [(2005) 3 SCC 427] which has no application in the present case. 2005
AIR SCW 1381

18. We, therefore, are of the opinion that the Executing Court as well as the High Court
committed a manifest error in opining that the Execution Petition was not barred by
limitation. The appeal is allowed. The impugned judgment is set aside with costs.
Counsel fee quantified at Rs. 5,000/-.
Appeal allowed.
@page-SC433
AIR 2008 SUPREME COURT 433 "M. P. State Electricity Board v. Grasim Industries
Ltd."
(From : Madhya Pradesh)*
Coram : 2 Dr. A. PASAYAT AND R. V. RAVEENDRAN, JJ.
Civil Appeal Nos. 1019 with 1026-1034 and 3223 etc. of 2006, D/- 12 -11 -2007.
M. P. State Electricity Board and Anr. v. Grasim Industries Ltd.
(A) Electricity (Supply) Act (54 of 1948), S.49, S.79 - ELECTRICITY - SALE - Sale of
electricity - Security deposit - Board not statutorily obligated to pay interest thereon -
Condition in agreement as to payment of interest - Can be deleted depending on factual
scenario. (Paras 13, 15)
(B) Electricity (Supply) Act (54 of 1948), S.49, S.79 - ELECTRICITY - SALE - Sale of
electricity - Requirement as to security deposit - Object of.
The deposit though called security deposit is really an adjustable advance payment of
consumption charges. The payment is in terms of the agreement interpreting the
conditions of supply. This security deposit is revisable from time to time on the basis of
average consumption charges depending upon the actual consumption over a period.
(Para 11)
Cases Referred : Chronological Paras
1993 AIR SCW 2025 : AIR 1993 SC 2005 (Foll.) 2, 6, 7, 14
M. L. Verma, S. S. Vaidyanathan, M. L. Jaiswal, A. K. Chitale and Kailash Vasdev. Sr.
Advocate Prakash Shrivastava, Akshat Shrivastava, Ms. Pradipti Shrivastava, Miten
Mahapatra, Sakesh Kr. Rohit Singh, Dharmendra Kumar Sinha, M. R. Vij, Niraj Sharma,
Praveen Kumar, K. V. Vishwa-nathan, Vikram Bajaj, Sanjeev Kumar, Vishal Gupta (for
M/s. Khaitan and Co.), S. K. Verma, Sushil Kumar Jain, Sanjay Grover and Nikilesh R.
(for M/s. Temple Law Firm), with them for Appellant.
* W. P. No. 751 of 1996 (107/99), D/- 9-10-2003 (MP) (Indore Bench).
Judgement
Dr. ARIJIT PASAYAT, J. :- In each of the appeals challenge is to the order passed by a
Division Bench of the Madhya Pradesh High Court, Indore Bench, in Letters Patent
Appeals/writ petitions filed by the respondents in each case. CA Nos.1033 and 1034 of
2006 have been filed with leave to file special leave petition. It is to be noted that while
allowing the writ petitions filed, the High Court placed reliance on the judgment rendered
in the Letters Patent Appeal filed under clause 10 of the Letters Patent by Grasim
Cement, Raipur, i.e. LPA 20207 of 1997. In the cases where the Letters Patent Appeals
were filed, learned Single Judge had decided in favour of the appellant-Board.
2

. Challenge in the writ petitions filed, which were decided related to the illegality of
action taken by the appellant-Board in deleting Clauses 21(f) and 21(g) of the Board's
General Conditions for Supply of Electrical Energy and The Sale of Miscellaneous and
General Charges. These related to agreement for payment of interest on security deposits.
The notification is dated 24.1.1996. Learned Single Judge in the cases which were subject
matter of the Letters Patent Appeal held that such a course was permissible. Reliance for
the purpose was placed on a decision of this Court in Ferro Alloys Corpn. Ltd. V. A.P.
State Electricity Board and Anr. (1993 Supp (4) SCC 136). While deciding the appeals
and the writ petitions, the Division Bench held that the view of the learned Single Judge
is not correct and for the purpose relied on paragraph 158 of the judgment in Ferro Alloys
case (supra). 1993 AIR SCW 2025

3. Mr. C.S. Vaidyanathan, learned senior counsel for the appellant-Board submitted that
the Division Bench read only a part of paragraph 158 of the judgment and not the
relevant part which empowers the Board to delete such a condition.
4. It is submitted that notification dated 24/1/1996 was issued in exercise of powers
conferred under Section 49 of the Electricity (Supply) Act, 1948 (in short the 'Supply
Act').
5. Learned counsel for the respondent, on the other hand, observed that this Court
categorically in paragraph 158 noted the lack of power to delete the condition relating to
payability of interest on security deposits.
6

. It is to be noticed that in Ferroy Alloys case (supra), this Court was dealing with two
categories of consumers in different States. One category related to Boards' regulations
for the States of Andhra Pradesh, Uttar Pradesh and Bihar, where there was provision for
payment of interest. In respect of some other States such as, Rajasthan and Orissa, there
1993 AIR SCW 2025

@page-SC434
was no such provision. This Court in paragraphs 143 and 145 held that where there is no
provision for payment of interest, the same is not illegal. We are not concerned with that
category of cases.
7

. Since the fate of these appeals primarily depends upon the view expressed by this Court
in Ferro Alloys case (supra) at paragraph 158, this paragraph needs to be noticed. The
same reads as follows: 1993 AIR SCW 2025, Para 135
"In view of the above finding, upholding the clause relating to non-payment of interest,
for example, Rajasthan and Orissa, what is to happen to such of those cases where
interest is provided like Andhra Pradesh, Uttar Pradesh and Bihar? In all those cases
wherever the Electricity Boards have framed a provision for payment of interest after
adjusting its finances at a stated rate they cannot be allowed to delete such a clause. The
provision for interest has been made by the various Boards having regard to the overall
budgetary and financial position and further, keeping in view the quantum and mode of
security deposit and billing and recovery practice. Nor again, could the Board withhold
payment of interest on the basis of this judgment. However, if there is any change in the
circumstances affecting the budgetary and financial position, the Board can examine the
case and decide the future course of action. But any change resulting in non-payment or
reduction of interest will have to be justified by cogent reasons and materials having a
bearing on the financial position of each Board and facts and circumstances of each
case."
(Underlined for emphasis)
8. Indisputably a bare reading of paragraph 158 quoted above shows that it is permissible
for the Board to take a decision relating to the desirability for payment of interest on
security deposits or otherwise.
9. Each of the Electricity Boards before us is a State within the meaning of Article 12 of
the Constitution of India. The Boards are different from licensees. Each of the Boards has
framed its own terms and conditions of supply. One such condition relates to security
deposits. Such a deposit varies from Board to Board. For example, under the terms and
conditions notified by Andhra Pradesh Electricity Board under Condition No. 28.1.1, the
consumer is required to deposit with the Board a sum in cash equivalent to estimated
three months consumption charges. In the case of Rajasthan, the security is in the form of
cash for one month and bank or insurance guarantee for two months.
10. The legislative sanction behind the power of the Board to direct a consumer to furnish
security may be examined. It has already been seen that the Supply Act is complementary
to the Electricity Act, 1910. Section 26 of the Supply Act states that the Board shall have
all the powers and obligations of a licensee under the Electricity Act. And this shall be
deemed to be a licence of the Board for the purpose of the Act. Under the regulations
framed by the Board in exercise of powers of Section 49 read with Section 79(j) the
consumer is only entitled and the Board has an obligation to supply energy to the
consumer upon such terms and conditions as laid down in the regulations. If, therefore,
the regulations prescribed a security deposit that will have to be complied with. It also
requires to be noticed under Clause (6) of Schedule II of the Electricity Act that the
requisition for supply of energy by the Board is to be made under proviso (a) after a
written contract is duly executed with sufficient security. This, together with the
regulations stated above, would be enough to clothe it with legal sanction. In cases where
regulations have not been made Rule 27 of the Rules made under the Electricity Act
enables the adoption of model form of draft conditions of supply. Annexure VI in Clause
14 states that the licensee may require any consumer to deposit security for the payment
of his monthly bills for energy supplied and for the value of the meter and other apparatus
installed in his premises. Thus, the Board has the power to make regulations to demand
security from the consumers.
11. The next question will be: what is the object in demanding security? The deposit
though called security deposit is really an adjustable advance payment of consumption
charges. The payment is in terms of the agreement interpreting the conditions of supply.
This security deposit is revisable from time to time on the basis of average consumption
charges depending upon the actual consumption over a period. This is the position under
the terms of supply of energy with reference to all the Boards.
12. For supply of electricity the Board needs finance for production, supply and
@page-SC435
other charges necessary for supply of electricity. For this purpose, it takes loans from
various financial institutions. This is best illustrated if one looks at the transactions of
Punjab Electricity Board where electric energy is generated through hydro as well as
thermal plants for ultimate sale to the consumers. Of the total power generated about 50
per cent is through hydro plants. The remaining energy is generated through thermal
power plants which are operated on coal/oil. Due to limited hydro resources within the
State of Punjab the dependency on power on thermal plants is on the increase. The
present requirement for working of thermal plants is more than 52 lakh tonnes of coal per
annum. In addition, 60 thousand kilo litre of furnace oil is required. The coal
companies/Coal India Limited together with major suppliers or power plant like M/s.
BHEL demand cost of coal/spares/ projects in advance for the supply of material. The
Board is also required to purchase power from Central projects N.T.P.C., N.H.P.C. in
order to meet the demand for power by the consumers. For purchase of such power again
advance payments are made by the Board. On such advances the Board is not paid
interest. The effect is, the Board is obliged to bear the liability of hundreds of crores of
rupees per annum. It has no option but to pay the charges and deposits in order to keep
the power available at a level to meet with the demand of the consumers. It is the case of
the Board that it has opened letters of credit by making advance deposits in favour of
National Thermal Power Corporation and the suppliers. Coal India Limited has also
asked the Board to open revolving letters of credit in favour of coal companies/Coal India
Limited. Despatch of coal is only against the letter of credit.
13. In the above premises, it follows that there is nothing to indicate under the scheme of
the Electricity Act or Schedule VI of the Supply Act that interest must be paid on the
security deposit.
14

. These aspects have been highlighted in Ferro Alloys case (supra). 1993 AIR SCW 2025

15. Obviously, the Division Bench of the High Court has not considered the effect of the
underlined observations of this Court regarding the permissibility to delete provisions for
payment on security deposits, as noted in the said paragraph 158. This has to be decided
on the factual position of each case. We find that in the order of the learned Single Judge
which formed the subject matter of challenge in the LPAs, there are certain factual
conclusions arrived at by learned Single Judge. The Division Bench has not dealt with the
acceptability or otherwise of the view and has only referred to paragraph 158 to hold that
it cannot be done, overlooking the underlined portion relating to the permissibility for
such a course to be adopted.
16. In the aforesaid circumstances, we deem it proper to set aside the impugned judgment
in each case and remit the matter to the High Court for a fresh consideration in the light
of what has been stated in paragraph 158 so far as it relates to the Boards' powers to
delete provision relating to payment of interest on security deposits on the factual
scenario. We make it clear that we have not expressed any opinion on the merits of the
case.
17. The appeals are disposed of accordingly with no orders as to costs.
Order accordingly.
AIR 2008 SUPREME COURT 435 "Union of India v. Mahajabeen Akhtar"
(From : Delhi)
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Civil Appeal No. 5087 of 2007 (arising out of SLP (C) No. 6635 of 2005), D/- 1 -11
-2007.
Union of India and Anr. v. Mahajabeen Akhtar.
Constitution of India, Art.39(d), Art.16 - DIRECTIVE PRINCIPLES - EQUALITY IN
PUBLIC EMPLOYMENT - PAY PARITY - Equal pay for equal work - Applicability -
Persons have to be similarly situated in all respects - Equivalence in pay depends on
many factors - Research Asst. (Urdu) - Held not entitled to pay parity with Research Asst.
in other languages.
A large number of factors, namely, educational qualifications, nature of duty, nature of
responsibility, nature of method of recruitment etc. will be relevant for determining
equivalence in the matter of fixation of scale of pay. Art. 39(d) as also Art. 14 of the
Constitution of India must be applied, inter alia, on the premise that equality clause
should be invoked in respect of the people who are similarly situated in all respects.
(Paras 19, 25)
@page-SC436
The respondent was working as Research Assistant (Urdu) in Bureau of Promotion of
Urdu language. The Central Govt. constituted National Council for Promotion of Urdu
Language (NCPUL) in place of the Bureau of Promotion of Urdu Language. NCPUL
started functioning from 1-4-1996. Employees of the Bureau were given an option either
to continue to work in the Govt. Department or get themselves transferred to NCPUL.
Respondent opted for Govt. service. She was redeployed as Librarian in National Gallery
of Modern Art and designated as Assistant Librarian and Information Assistant. The scale
of pay of Research Assistants was revised by 5th Pay Commission. The respondent
claimed pay parity with Research Assistants in Central Hindi Directorate of the Ministry
of Human Resources Development, Department of Education, Central Institute of Indian
Language, commission for Scientific and Technical Terminology, Ministry of Human
Resources Development, Department of Education and Bureau for Promotion on ground
that respondent had been in the job of the Bureau of Promotion of Urdu Language as on
1-1-1996 from which date the recommendations of the Fifth Pay Commission came to be
implemented.
Held when the requisite criteria in regard to appointment (essential qualifications),
promotion, transfer as well as the nature of duties required to be performed by the
incumbents of posts vis-a-vis that of Research Assistant (Urdu) and those of Research
Assistants in other languages is different. Not only that, the nature of duties is also
different. The respondent cannot claim pay parity. Moreover respondents pay has been
revised keeping in view educational qualification and other relevant factors by an expert
body, no exception thereto can be taken. (Paras 17, 18, 24, 26)
Cases Referred : Chronological Paras
2006 AIR SCW 3013 : AIR 2006 SC 2296 : 2006 (4) AIR Kar R 652 : 2006 (4) ALJ 590:
2006 (3) AIR Jhar R 537 (Rel on) 21
2006 AIR SCW 6035 : AIR 2007 SC 262 : 2007 (1) AIR Kar R 555 (Ref) 27
2005 AIR SCW 5632 : AIR 2006 SC 161 : 2005 Lab IC 4322 : 2006 (1) AIR Kar R 80:
2006 (1) AIR Bom R 158 : 2006 (1) AIR Jhar 238 (Rel on) 22
(2004)1 SCC 347 (Rel on) 20
2003 AIR SCW 2278 : AIR 2003 SC 2305 : 2003 Lab IC 1749 : 2003 All LJ 1435
(Disting) 25
2002 AIR SCW 2896 : AIR 2002 SC 2589 : 2002 Lab IC 2630 (Ref) 19, 27
(2000)8 SCC 580 (Ref) 19
1999 AIR SCW 1153 : AIR 1999 SC 1356 : 1999 Lab IC 1639 (Disting) 23
1992 AIR SCW 1071 : AIR 1992 SC 1203 : 1992 Lab IC 1047 (Ref) 19
AIR 1991 SC 1367 : 1991 Lab IC 1120 (Disting) 23
AIR 1989 SC 19 : 1989 Lab IC 1146 19
AIR 1988 SC 1663 :L 1989 Lab IC 1314 (Disting) 25
A. Sharan, ASG, Ms. Sunita Sharma, Ms. Sushma Suri, for Appellants; Sudhir
Kulshreshtha, for Respondent.
Judgement
S. B. SINHA, J. :-Leave granted.
2. Applicability of the doctrine of 'equal pay for equal work' is in question in this appeal
which arises out of a judgment and order dated 19.8.2004 passed by a Division Bench of
the High Court of Delhi in Civil Writ Petition No.3719 of 2002 dismissing the writ
petition filed by the appellant questioning an order dated 11.9.2000 passed in Original
Application No.52 of 2000 by the Central Administrative Tribunal directing to consider
the question of grant of replacement pay-scale of Rs.6500-10500 to the respondent, with
consequential benefits in her favour.
3. Basic fact of the matter is not in dispute.
4. Respondent herein was appointed as Technical Assistant of Urdu Language in the
Bureau of Promotion of Urdu Language. She was placed in the pay scale of Rs.425-700.
She was promoted as Research Assistant in the scale of pay of Rs.550-900. The said scale
of pay was revised to Rs.1640-2900 on the recommendations of the Fourth Pay Revision
Commission.
5. The Central Government constituted National Council for Promotion of Urdu
Language (NCPUL) in place of the Bureau of Promotion of Urdu Language. NCPUL
started functioning from 1.4.1996. Employees of the Bureau were given an option either
to continue to work in the Government Department or get themselves transferred to
NCPUL. Respondent opted for Government service. Her name was, therefore, referred to
surplus cell for redeployment. She was redeployed as Librarian in National Gallery of
Modern Art and designated as Assistant Librarian and Information Assistant. Her pay was
upgraded in the scale of Rs.6500-10500.
@page-SC437
6. Indisputably, the scale of pay of Rs.1640-2900 was revised to Rs.5500-9000.
7. Consequent upon the recommendations of the Fifth Pay Commission, Respondent filed
a representation for upgradation of her pay-scale which was not acceded to. She
thereafter filed an application before the Central Administrative Tribunal. By reason of an
order dated 11.9.2000, the learned Tribunal allowed the said application opining :
"In the above view of the matter the application succeeds and is accordingly allowed. The
respondents are directed to consider the grant of the replacement scale of Rs.6500-
10500/- to the applicant, keeping in view the similarity in essential qualification,
functions in responsibilities with those in CHD, CIIL, CSIT w.e.f 1.1.96, with
consequential benefits. This should be done within four months from the receipt of this
order. Parties to bear their own costs (sic manner)."
In arriving at the said conclusion, the Tribunal held :
"All the institutes including BPU were functioning on 1.1.1996 when the
recommendations of the 5th Pay Commission were implemented. BPU came to be
abolished only on 31.3.1996, and, therefore, there is no reason why the Research
Assistant in BPU should have been treated in a different matter."
8. A writ petition filed by the appellant herein against the said order has been dismissed
by the High Court by reason of the impugned judgment stating :
"The case of the respondent in her OA was that the post of Research Assistant in the
Bureau of Urdu and also in the other sister departments was in the pay scale of Rs.1640-
2900 upto 31.12.1995 and that qualifications required for the incumbents also were the
same and that duties, functions performed were also similar in nature and, therefore, if
post of Research Assistant was placed in the pay scale of Rs.6500-10500 in those
Department under the same Education Department, she was also entitled to the same pay
scale on the principle of equality. We find that there is no specific denial or rebuttal to this
by the petitioners in their reply to the OA. Their stands seems to be couched in general
terms. They also seem to be suffering from some misconception that since the post of
Research Assistant was abolished in the Bureau of Urdu (NCPUL) and, therefore, the
analogy of the pay scale granted to Research Assistant in other sister Departments could
not be applied to her case. What is missed is that respondent was asking for the revised
pay scale at par with the Research Assistants in other offices under the Education
Department on the basis of similarity in the nature of discharging of duties etc. which was
not controverted by the petitioner and to which she was entitled in the absence of any
denial in this regard. Therefore, it can't be said the Tribunal has gone wrong in directing
petitioner to consider this respondent for grant of pay scale of Rs.6500-10500 from
1.1.1996 on the analogy of the scale granted to Research Assistant in other Offices in the
Education Department, in view of the similarity in qualifications functions and
responsibilities of the post of Research Assistant in the Bureau on one hand and in the
CHD, CSTT, CIIL on the other. The Tribunal order is accordingly affirmed and petition is
disposed of."
9. Mr. Amrendra Sharan, learned Additional Solicitor General of India appearing on
behalf of the appellants, submitted that the Tribunal and consequently the High Court
committed a serious error in arriving at the aforementioned conclusion in so far as they
failed to take into consideration the fact that the nature of qualification and other relevant
factors clearly point out that the post of Librarian is not equivalent to that of the post of
Research Assistant in other regional languages.
10. Mr. Kulshreshtha, learned counsel appearing on behalf of the respondent, on the other
hand, would submit that as the respondent had been in the job of the Bureau of Promotion
of Urdu Language as on 1.1.1996 from which date the recommendations of the Fifth Pay
Commission came to be implemented, the impugned judgment and order should not be
interfered with.
11. Promotion of regional languages is undertaken by various bodies including Central
Hindi Directorate of the Ministry of Human Resources Development, Department of
Education, Central Institute of Indian Language, Commission for Scientific and Technical
Terminology, Ministry of Human Resources Development, Department of Education and
Bureau for Promotion.
12. So far as the educational and other
@page-SC438
qualifications required by direct recruits for promotion of the Urdu language are
concerned, following are stated to be the essential qualifications :
"(i) Masters Degree of a recognized University or equivalent.
(ii) Must have taken Urdu as optional subject at the graduation level for 3 years/2 years
degree course in the case of M.As. or must have taken Urdu as a second language upto
2nd years of 3 years degree graduation in case of MA/M.Sc. M.Com or must have taken
Urdu at High School/Higher Secondary School level in the case of M.Sc/M.Com where
offering Urdu as a second language at degree level is not furnished.
(iii) One year's experience of teaching or terminological and/or translation/editing work
in Urdu
Note 1 : Qualifications are relaxable at the discretion of the Union Public Service
Commission in case of candidates otherwise well qualified.
Note 2 : The qualification regarding experience is relaxable at the discretion of the Union
Public Service Commission in the case of candidates belonging to the Scheduled Castes
and Schedules Tribes if, at any stage of selection, the Union Public Service Commission
is of the opinion that sufficient number of candidates from these communities possessing
the requisite experience are not likely to be available to fill up the vacancies reserved for
them.
Desirable : Working knowledge of one or more, modern Indian languages other than
Urdu."
13. However, in respect of Hindi language, the qualifications prescribed are as under :
"(i) For post of Research Assistant (Hindi) : Master's Degree in Hindi or Sanskrit with
Hindi as an elective subject at Degree stage from a recognized university or equivalent
and should have studied English as a compulsory/optional subject at degree level.
(ii) For Post of Research Assistant (Regional Language) Master's Degree in Hindi with
knowledge of regional language concerned and English at Secondary School level or
Master's Degree in the regional language concerned with Hindi and English as
compulsory/optional subject at secondary school examination level. (Regional language
includes only those languages which have been specified in the Eighth Schedule of the
Constitution of India, as amended from time to time, baring Hindi and Sanskrit)
(iii) For post of requiring knowledge of Medicine : Degree in Integrated System of Indian
Medicine Bachelor of Indian Medicine and Surgery/Bachelor of Ayurvedic Medicine and
Surgery or Ayurveda/Pharmacy or equivalent from a recognized university or board with
Hindi and English as compulsory/optional subject at secondary school examination level.
(iv) For post requiring knowledge of Engineering : (Civil, Mechanical, Electrical,
Electronics, Computer Science, Textile, Mineral Leather Technology) : Diploma of a
recognized Institution/University or equivalent in the subject concerned with Hindi and
English as compulsory/optional subject as secondary school examination level.
(v) For post of Research Assistant (Management)/Research Assistant (Public
Administration) : Post-graduate diploma in Management/Public Administration
respectively from a recognized university or equivalent with knowledge of English and
Hindi as compulsory/optional subject at secondary school examination level or
equivalent.
(vi) For post of Research Assistant (Journalism): Masters degree in Hindi with Diploma
in Journalism/Mass Communication with English as compulsory/optional subject at
secondary school examination level.
(vii) For posts in any subject other than these mentioned above : Masters Degree of
recognized University or equivalent in the subject concerned with English and Hindi as
compulsory/optional subject at Secondary School Examination level.
Note 1 : Qualifications are relaxable at the discretion of the Union Public Service
Commission in case of candidates otherwise well qualified.
Note 2 : Selected candidates will have to complete a departmental training programme
during their probation.
Desirable : Only for posts of Research Assistant (Hindi) : Certificate/Diploma from a
recognized Institute in Translation or Applied Linguistics or Functional Hindi."
14. The essential qualifications required for other languages in CIIL are stated to be as
under :
"(i) Master's Degree in
@page-SC439
Linguistic/Comparative Philology/Indian Language and Literature/
Psychology/Education/Sociology/ Anthropology/Folklore/Statutics from recognized
University or equivalent.
(ii) One year's research/teaching experience.
(iii) Proficiency in any Indian Language as a subject at the Secondary School Level in the
case of Master of Arts in Linguistics or Comparative Philology or as a subject at the
degree level in the case of Master of Arts in Subject other than Linguistics and
Comparative philology.
Note 1 : Specific requirement will be indicated at the time of recruitment.
15. We may also note that in the case of recruitment by promotion, deputation, transfer
and grades from which promotion or deputation or transfer to be made, the following are
the requisite qualifications :
Urdu
Promotion :
Technical Assistant (Urdu) working in the Bureau for Promotion of Urdu with 5 years
regular service in the grade.
Transfer or deputation :
(a) Officers under the Central Government/State Government :
(i) holding analogous posts; or
(ii) with 5 years service in posts in the scale of pay of Rs.425-700 or equivalent; and
(b) Possessing the Education qualifications and experience prescribed for direct recruits
under column-7. Period of deputation including period of deputation in another ex-cadre
post held immediately preceding this appointment in the same organization/department
shall ordinarily not exceed 3 years."
Hindi
Transfer on deputation/transfer :
Officers under the Central Government
(a) (i) Holding analogous posts in regular posts on regular basis, or
(ii) With 5 years regular service in post in the scale of pay of Rs.1400-2300/2600 or
(iii) with 15 years regular service in post in the scale of Rs.950-1500 or equivalent.
(b) possessing the educational qualifications and experience prescribed for direct
recruitment under column 8. (period of deputation including period of deputation in
another ex cadre post held immediately preceding this appointment in the same or some
other organization/department of the Central Government shall ordinarily not to exceed 3
years. The maximum age limit for appointment by transfer on deputation including
transfer shall be not exceeding 56 years, as on the closing date of receipt of applications."
16. We may now consider different nature of duties required to be performed by these
categories of officers :
"Urdu
To assist the officer with whom they are attached in implementing the publication
programme BPU at various stages. This includes organizing of subjects panel melting,
implementing their decisions, checking and editing mss, organizing Terminology
committee meeting and preparing of glossary of technical terms maintenance of record of
all the above mentioned activity and programming the duty allotted from time to time in
furtherance of the activity of BPU.
Hindi
To assist in the implementation of schemes relating to periodicals, preparation of
Dictionaries-Lingual Bilingual, Trilingual and Multilingual, preparation of Dictionaries in
Foreign Languages under Cultural Exchange Programme.
Other Regional Languages
To assist in Linguistic and in material production in various Indian Languages including
the non-scheduled languages."
17. The requisite criteria in regard to such appointment, promotion, transfer as well as the
nature of duties required to be performed by the incumbents of posts vis-a-vis that of
Research Assistant (Urdu) therefor, are different. Knowledge of English for Research
Assistant (Urdu) is not necessary whereas for the Research Assistant (Hindi) and other
regional languages, the same is essential.
18. So far as the Research Assistant for CIIL is concerned, the essential qualifications
therefore are absolutely different. So far as the educational qualifications required for
promotion to the said post by the incumbents of the Research Assistant to Research
Assistant (Hindi) is concerned, therefore also different educational qualifications are
required. Not only that, the nature of duties is also different. Whereas the Research
Assistants in respect of Urdu language are required to assist the officer with whom they
@page-SC440
are attached, the Research Assistants in Hindi and Research Assistants of CIIL are
required to assist implementation of the scheme. The Tribunal and consequently the High
Court might not, thus, be correct in opining that the educational qualifications as also the
nature of duty being the same, respondent was entitled to the benefit of the said scale of
pay.
19

. The question came to be considered in a large number of decisions of this Court wherein
it unhesitantly came to the conclusion that a large number of factors, namely, educational
qualifications, nature of duty, nature of responsibility, nature of method of recruitment
etc. will be relevant for determining equivalence in the matter of fixation of scale of pay.
{See Secretary, Finance Department and Ors. v. West Bengal Registration Service
Association and Ors. [1993 Supp.(1) SCC 153]; State of U.P. and Ors. v. J.P. Chaurasia
and Ors. [(1989) 1 SCC 121]; Union of India and Ors. v. Pradip Kumar Dey [(2000) 8
SCC 580] and State of Haryana and Anr. v. Haryana Civil Secretariat Personal Staff
Association [(2002) 6 SCC 72]}. 1992 AIR SCW 1071
AIR 1989 SC 19
2002 AIR SCW 2896

20. In Government of West Bengal v. Traun K. Roy and Ors. [(2004 (1) SCC 347], this
Court held as under :
"Question of violation of Article 14 of the Constitution of India on the part of the State
would arise only if the persons are similarly placed. Equality clause contained in Article
14, in other words, will have no application where the persons are not similarly situated
or when there is a valid classification based on a reasonable differentia."
21

. In U.P. State Sugar Corporation Ltd. and Anr. v. Sant Raj Singh and Ors. [(2006) 9
SCC 82], this Court opined : 2006 AIR SCW 3013

"The doctrine of equal pay for equal work, as adumbrated under Article 39(d) of the
Constitution of India read with Article 14 thereof, cannot be applied in a vaccum. The
constitutional scheme postulates equal pay for equal work for those who are equally
placed in all respects. Possession of a higher qualification has all along been treated by
this Court to be a valid basis for classification of two categories of employees."
22

. Same principle was reiterated by a Three Judge Bench of this Court in State of Haryana
and Ors. v. Charanjit Singh and Ors. [(2006) 9 SCC 321]. 2005 AIR SCW 5632

23

. We are not oblivious of some decisions of this Court wherein salary on the basis of
revised pay scales has been directed to be paid on the premise that no change in the duties
and functions of employees similarly situated had taken place although the concerned
employees were working in the different public sector undertakings {See The Employees
of Tennery and Footwear Corporation of India Ltd. and Anr. v. Union of India and Ors.
[1991 Supp.(2) SCC 565]} or where scale of pay is to be fixed for the judicial officers
posted in the State cadre vis-a-vis Union Territory Cadre {[Alvaro Noronha Ferriera and
Anr. v. Union of India and Ors. [(1999) 4 SCC 408]} but such a question does not arise
herein, as different scale of pay was recommended by an expert body having regard to the
nature of duties and functions. It is not a case where discrimination is sought to be made
on the basis of territory or posting in public sector undertaking. AIR 1991 SC 1367
1999 AIR SCW 1153

24. On the facts obtaining in this case, therefore, we are of the opinion that the doctrine of
equal pay for equal work has no application. The matter may have been different, had the
scales of pay have been determined on the basis of educational qualification, nature of
duties and other relevant factors. We are also not oblivious of the fact that ordinarily the
scales of pay of employees working in different departments should be treated to be at par
and the same scale of pay shall be recommended. Respondent did not opt for her services
to be placed on deputation. She opted to stay in the Government service as a surplus. She
was placed in list as Librarian in National Gallery of Modern Art. She was designated as
Assistant Librarian and Information Assistant. Her pay scale was determined at Rs.6500-
10500 which was the revised scale of pay. Her case has admittedly not been considered
by the Fifth Pay Revision Commission. If a scale of pay in a higher category has been
refixed keeping in view the educational qualifications and other relevant factors by an
expert body, no exception thereto can be taken. Concededly it was for the Union of India
to assign good reasons for placing her in a different scale of pay. It has been done. We
have noticed hereinbefore that not only the essential educational qualifications are
different but the nature of duties is also different.
@page-SC441
Article 39(d) as also Article 14 of the Constitution of India must be applied, inter alia, on
the premise that equality clause should be invoked in respect of the people who are
similarly situated in all respects.
25

. Mr. Kulshreshtha has placed strong reliance on State of U.P. and Ors. v. U.P. Sales Tax
Officers Grade II Association 2003 (6) SCC 250]. In that case the Pay Revision
Commission did not consider cases of a group of employees. On the aforementioned
premise, they were held to be entitled to the scale of pay which had been granted to the
persons similarly situated. We are not concerned with such an issue herein as the case of
the respondent has been considered and she has been given the benefit of a revised scale.
It was not necessary for the Government which had the requisite jurisdiction to remove
anomaly as has been held by this Court in Haryana State Adhyapak Sangh and Ors. v.
State of Haryana and Ors. [(1988) 4 SCC 571], whereupon Mr. Kul-shreshtha relied on.
As the Union of India has already applied its mind and revised the respondents pay in the
scale of pay of Rs.5500-9000, it was for the respondent to show that she had been
discriminated against. We have noticed hereinbefore that neither in fact nor in law, any
case of discrimination has been made out. 2003 AIR SCW 2278
AIR 1988 SC 1663

26. Our attention has been drawn to the findings of the Tribunal that the incumbents to
the post of Research Assistants in the Bureau and Institutions like Central Hindu
Directorate and Central Institution of Indian Languages etc. are similarly qualified and
they have been performing similar functions. There was no factual foundation for arriving
at the same finding. Consequently, the said conclusion was wrongly drawn by the
Tribunal. Furthermore, no formula having mathematical exactitude can be pressed into
service in a situation of this nature. The Tribunal and consequently the High Court, in our
opinion, therefore, was not correct in arriving at the said decision.
27

. Another aspect of the matter, however, cannot be ignored. Respondent has been paid the
amount by way of difference in the scale of pay only for a short period. She has been held
to be entitled only for a sum of Rs.7,000/- and odd. We are, therefore, of the opinion that
this Court, in exercise of its jurisdiction under Article 142 of the Constitution, should
direct that the amount already paid need not be recovered. Similar direction has been
passed by this Court in Haryana Civil Secretariat Personal Staff Association (supra)
stating : 2002 AIR SCW 2896
(Para 10)

"The courts should approach such matters with restraint and interfere only when they are
satisfied that the decision of the Government is patently irrational, unjust and prejudicial
to a section of employees and the Government while taking the decision has ignored
factors which are material and relevant for a decision in the matter. Even in a case where
the court holds the order passed by the Government to be unsustainable then ordinarily a
direction should be given to the State Government or the authority taking the decision to
reconsider the matter and pass a proper order. The court should avoid giving a declaration
granting a particular scale of pay and compelling the Government to implement the same.

{[See also Punjab National Bank and Ors. v. Manjeet Singh and Anr. [(2006) 8 SCC
647]} 2006 AIR SCW 6035

28. We, therefore, although agree with the submissions of learned Additional Solicitor
General, in the facts and circumstances of this case, decline to grant any relief in favour
of the appellant. The appeal is dismissed in view of our observations aforementioned.
There shall, however, be no order as to costs.
Appeal dismissed.
AIR 2008 SUPREME COURT 441 "Paramjit Singh v. State of Punjab"
(From : Punjab and Haryana)*
Coram : 2 PRAKASH PRABHAKAR NAOLEKAR AND B. SUDERSHAN REDDY,
JJ.
Criminal Appeal No. 1474 of 2005, D/- 31 -10 -2007
Paramjit Singh @ Mithu Singh v. State of Punjab, Through Secretary (Home).
(A) Criminal P.C. (2 of 1974), S.154 - Punjab Police Rules (1934), R.2 - FIR - POLICE
OFFICERS - F. I. R. - Recording - Punjab Police Rules do not override provisions of
Criminal P. C. - Plea that under Rules information must be reduced to writing and be
entered in Police Station daily diary and only thereafter FIR is to be issued - Not tenable -
Further truth and veracity of contents of
@page-SC442
FIR cannot in all cases be tested with reference to entries in Police Station daily diary.
A bare reading of the relevant rule under Punjab Police Rules makes it clear that every
information relating to the commission of a cognizable offence, if given orally to an
officer-in-charge of a police station shall be reduced to writing and the substance thereof
shall be entered in a book to be kept in such form as may be prescribed and only
thereafter in the Police Station diary. The procedure prescribed under Criminal P. C. is
required to be followed scrupulously by the Officer-in-charge of the Police Station. The
Punjab Police Rules do not in any manner override the provisions of the Code of
Criminal Procedure. The said rules are meant for the guidance of the Police Officers in
the State and supplement the provisions of the Code of Criminal Procedure but not
supplant them. The truth and veracity of contents of the FIR cannot in all cases be tested
with a reference to the entries made in the Police Station daily diary which is maintained
under the Punjab Police Rules. (Para 13)
The plea that under the Punjab Police Rules information must be reduced to writing and
be entered in the police station daily diary and only thereafter the First Information
Report is to be issued is absolutely untenable. In the instant case, the original of the DDR
has not been filed into the Court and what has been filed was only a photocopy and that
too at the instance of the accused after four years of the closure of evidence. It is clearly
evident from the statement of prosecution witness that the First Information Report was
recorded first and the DDR thereafter. He further stated that the DDR had been recorded
on the basis of the facts recorded in the First Information Report. Thus, it would be
difficult to comprehend as to how to- tally a different version is found in DDR which is
said to be a photocopy of DDR. Thus, the timing and contents of FIR based on the entries
made in DDR cannot be doubted when there are serious doubts about the genuineness of
the very document DDR. (Paras 12, 14)
(B) Criminal P.C. (2 of 1974), S.156 - INVESTIGATION - Investigation - Defect or
procedural irregularity - By itself cannot vitiate and nullify trial based on such erroneous
investigation. (Para 13)
(C) Penal Code (45 of 1860), S.300, S.34 - MURDER - COMMON INTENTION -
EVIDENCE - Murder - Accused were armed with deadly weapons and standing outside
the house of deceased - Deceased and eye-witness going towards their houses - Accused
persons assaulted deceased - Said eye-witness raised alarm which attracted son of
deceased to spot who also witnessed the incident - Thus, presence of both the eye-
witnesses cannot be doubted on ground that they have not made any attempt to rescue
deceased - Moreso, when their presence at the scene of offence is evident from FIR
which was lodged by one of them.
Evidence Act (1 of 1872), S.3. (Paras 15, 16)
(D) Evidence Act (1 of 1872), S.3 - EVIDENCE - MURDER - Murder - Eye-witness, son
of deceased - Testimony of - Credibility of - Fact that he could not spell out accurately
situs of injuries on dead body - Would not make his presence at spot doubtful. (Para
16)
(E) Penal Code (45 of 1860), S.300, S.34 - MURDER - COMMON INTENTION -
WITNESS - Murder - Common intention - Accused persons attacked deceased and
caused injuries - Common intention to kill is evident - Consistent evidence of eye-
witnesses, the direct witnesses - Fact that appellant accused inflicted injuries with deadly
weapon itself shows that he had also shared common intention - Sharing of common
intention by appellant-accused is evident from fact that he was armed with deadly
weapon and inflicted two injuries on victim - Thus, in circumstances whether those
injuries were sufficient in ordinary course to cause death pales into insignificance -
Conviction of accused under S. 302 read with S. 34 - No interference. (Para 18)

Jana Kalyan Das and Avijeet Bhujabal, for Appellant; Kuldip Singh, for Respondent.
* Cri. Appeal No. 25-DBA of 1995, D/- 27-9-2004 (PandH)
Judgement
B. SUDERSHAN REDDY, J. :- The appellant has preferred this appeal under Section
379 of the Code of Criminal Procedure read with provisions of the Supreme Court
(Enlargement of Criminal Appellate Jurisdiction) Act, 1970 impugning the judgment and
order of the High Court of Punjab and Haryana in Criminal Appeal No. 25-DBA of
@page-SC443
1995 whereby the High Court reversed the judgment of acquittal against the appellant,
who was tried along with three other co-accused, recorded by the Additional Sessions
Judge, Sangrur in Sessions Case No. 44 of 1989. The High Court accordingly convicted
the appellant for the offence punishable under Section 302 read with 34 of the Indian
Penal Code (IPC) and sentenced to undergo imprisonment for life and to pay a fine of Rs.
5,000/-, in default of payment, to undergo rigorous imprisonment for six months.

2. The prosecution case, in brief, is that the accused Mukhtiar Singh (A-1) and Gurdial
Singh (A-2) and deceased Harnek Singh were real brothers. The family consists of eight
brothers altogether. Deceased Harnek Singh along with his wife Tej Kaur and son
Gurmail Singh (PW-4) were living jointly with one of his brother Amar Singh (PW-3).
Gurdev Singh and Dalbara Singh, two other brothers were residing together whereas the
others were residing separately in their respective houses located in their agricultural
lands. Dalip Singh, father of Gurcharan Singh (A-3) and Mithu Singh (A-4) were residing
separately. Dalip Singh is stated to have entered into an agreement to sell his house to
Babu Singh, Balak Singh and their sons but the same could not be fructified into regular
sale as Harnek Singh had interfered in the deal. The accused accordingly developed
grudge as against Harnek Singh over his unwarranted interference in the sale transaction.
3. On 6.5.1989 about 7.00 p.m. Amar Singh (PW-3) and deceased Harnek Singh were
going towards their houses in the fields whereas Tej Kaur and Gurmail Singh (PW-4)
were already present in the house. The deceased Harnek Singh and Amar Singh (PW-3)
saw all the four accused standing outside the house of Mukhtiar Singh(A-1). Mukhtiar
Singh(A-1) was armed with a Sumewali Dang, both Gurcharan Singh @ Charna (A-
3)and the appellant were armed with a gandasa each. Gurdial Singh (A-2) shouted a
lalkara that Harnek Singh should be taught a lesson for interfering in Dalip Singh's
property deal and he should be killed, on which the rest of the three accused inflicted
several injuries on Harnek Singh. Amar Singh (PW-3) raised an alarm, which attracted
Tej Kaur and Gurmail Singh to the spot and they too witnessed the incident. The accused
ran away from the scene of occurrence. Harnek Singh was first removed to his farm
house and then to the Civil Hospital, Longowal by Amar Singh (PW-3). It was about 9.10
p.m. Dr. Rakesh Jain (PW-6) having noticed the critical condition of Harnek Singh
immediately referred him to the Civil Hospital, Sangrur. Dr. Rakesh Jain (PW-6) sent
information to SHO, Police Station, Longowal at about 9.25 p.m. Harnek Singh,
however, died soon after reaching the Civil Hospital, Sangrur. Amar Singh (PW-3) along
with his brother Gurdev Singh left the hospital and reached the police station, Longowal
at about 1.15 a.m. on 7.5.1989 and lodged First Information Report. Gurmail Singh (PW-
4) was at the hospital near the dead body. The special report sent to the Illaqa Magistrate,
Sangrur reached at 5.00 a.m. The police on the completion of the investigation filed
charge sheet against Gurcharan Singh @ Charna (A-3) for the offence punishable under
Section 302 of the IPC whereas the other accused were charged under Section 302/34 of
the IPC. The accused pleaded not guilty.
4. The prosecution in order to establish its case relied on the evidence of Dr. K.S. Raikhy
(PW-1), who performed the post-mortem examination on the dead body and found six
injuries thereon, three incised and three lacerated; Amar Singh (PW-3) and Gurmail
Singh (PW-4), the two eye witnesses; ASI, Malikat Singh (PW-5), the Investigating
Officer and Dr. Rakesh Jain (PW-6) who first received the injured at Civil Hospital,
Longowal.
5. The trial court upon appreciation of evidence available on record acquitted all the
accused of the charges. The trial court recorded finding that the presence of the eye-
witnesses Amar Singh (PW-3) and Gurmail Singh (PW-4) was unlikely as they were not
stamped witnesses and had not intervened at the time when Harnek Singh was being
belaboured. The court also found that Gurmail Singh (PW-4) had apparently not been
present at the spot as his ocular version did not correspond with the medical evidence
with regard to the number and situs of the injuries on the dead body. The trial court also
referred to the contents in the DDR (Exh. DX/1) in which it is stated that the accused
were armed with Sotis and there was no reference to any of the accused armed with
gandasa and accordingly held this important circumstance itself nullify the prosecution
story. The trial court also held
@page-SC444
that there was delay in lodging the First Information Report. The trial court accordingly
acquitted all the accused giving them the benefit of doubt.
6. The High Court upon re-appreciation of evidence found that there was no delay in
lodging the First Information Report. The High Court also reversed the finding recorded
by the trial court as regards the presence of the eye-witnesses as it came to the conclusion
that there is no reason to doubt the presence of Amar Singh (PW-3) and Gurmail Singh
(PW-4) at the scene of occurrence. The High Court took the view that the presence of
eye-witnesses was absolutely natural and they had good reason for being present at the
scene of offence. The High Court relied upon the First Information Report in which it has
been mentioned that the accused were armed with gandasas and dangs. The High Court
found the DDR (Exh. DX/1) is the photocopy of the original which was not produced in
the court. Be it noted that the prosecution had closed its evidence on 22.9.1993 and the
statements of all the accused under Section 313 Cr.P.C. had thereafter been recorded and
it is only thereafter the accused moved an application to recall Amar Singh (PW-3) and
Iqbal Rai (PW-7) who had recorded the DDR (Exh. DX/1) which was allowed by the trial
court. The application was ordered about 4 years after the closure of evidence. The High
Court upon appreciation of the evidence, however, found that the so-called entry made in
the DDR (Exh. DX/1) by itself may not make any difference to the prosecution case
inasmuch as the evidence of Iqbal Rai (PW-7) clearly reveals that the First Information
Report had been recorded first and entries in the DDR were made thereafter. The High
Court also found that the injuries found on the body of the deceased were inflicted by
sharp cutting weapons which finds support from the medical evidence. The High Court in
conclusion held:
"As per the ocular version, injuries 1,3 and 4 are incised wounds, which had allegedly
been caused by Gurcharan Singh and Mithu accused and injury No. 2 by Gurcharan
Singh whereas injury No. 5 had been attributed to Mukhtiar Singh accused. There is no
clear cut evidence as to who had caused injury No. 6, which had been detected by Dr.
K.S. Raikhy (PW-1) at the time of post-mortem examination. We also observe that the
Gandasa is a cutting weapon with a Lathi attached to it. It is, therefore, possible that a
Gandasa could have been used Lathiwise as well while causing the lacerated injuries.
Mukhtiar Singh, who was armed with a Dang, has been attributed one simple lacerated
wound 3 cm x 3 cm in dimension. He is, therefore, entitled to claim some benefit in an
appeal against acquittal for an incident, which happened in the year 1989. Gurdial Singh
was unarmed and only a Lalkara has been attributed to him. To be on the safe side, he too
must be dealt with in the same manner as Mukhtiar Singh.
We accordingly dismiss the appeal qua Mukhtiar Singh and Gurdial Singh. We, however,
find that case against Gurcharan Singh and Mithu stands proved beyond doubt. The
appeal qua them is allowed. Gurcharan Singh is held guilty for an offence punishable
under Section 302 of the Indian Penal Code whereas Mithu Singh is held guilty for the
offence punishable under Section 302/34 thereof. They are sentenced to undergo
imprisonment for life and to pay a fine of Rs. 5,000/- each and in default of payment of
fine, to undergo rigorous imprisonment for six months each. The fine, if paid, shall be
paid to Tej Kaur, the widow of the deceased."
7. This appeal has been preferred by Mithu Singh (A-4) alone.
8. The learned counsel appearing for the appellant submitted that the entries made in the
DDR in which it has been mentioned that the accused were armed with Sotis completely
falsify the prosecution story. The learned counsel made an attempt to contend that the
entries were first made in the DDR based on the First Information Report made by Amar
Singh (PW-3) and only thereafter the First Information Report has been recorded making
improvements to implicate the accused in the case. The learned counsel also contended
that the presence of Amar Singh (PW-3) and Gurmail Singh (PW-4) at the scene of
occurrence is highly doubtful for they did not intervene when the deceased was being
attacked. It was also contended that two injuries were simple in nature out of which one
is alleged to have been caused by the appellant herein and, therefore, there is no evidence
of any common intention to kill the deceased.
9. The learned counsel for the State of Punjab submitted that the common intention is
evident from the fact that the appellant was armed with deadly weapon and it
@page-SC445
is immaterial as to the nature of the injuries inflicted by the appellant on the body of the
deceased. The learned counsel supported the findings of the High Court.
10. We have considered the submissions made during the course of hearing of the appeal
and perused the evidence available on record.
11. We shall first deal with the contention with regard to delay in lodging the First
Information Report. The evidence available on record reveals that the incident took place
on 6.5.1989 at 7.00 p.m in village Longowal. The distance between village and police
station is about 3 kms. It is in the evidence of Amar Singh (PW-3) and Gurcharan Singh
(PW-4) that they had immediately removed critically injured Harnek Singh to their farm
house and thereafter to the Primary Health Center, Longowal in a bullock cart and
reached there at 9.10 p.m. Dr. Rakesh Jain (PW-6) who attended the injured sent the ruqa
(Exh. PN) to the Police Station, Longowal at 9.25 p.m. Having regard to the grievous
nature of injuries and condition of the victim Dr. Rakesh Jain (PW-6) referred the injured
to the Civil Hospital, Sangrur. The evidence of Dr. Rakesh Jain (PW-6) in this regard
remains unimpeached and there is absolutely no reason to disbelieve any portion of his
evidence. It is Amar Singh (PW-3) who took the injured to the Civil Hospital at
Longowal and thereafter to the Hospital at Sangrur where the injured succumbed to
injuries. It is only thereafter Amar Singh (PW-3) went to police station which is at a
distance of about 9-10 kms. from the Hospital and lodged First Information Report. Amar
Singh (PW-3) was present not only at the scene of offence but accompanied the injured to
Civil Hospital, Longowal and thereafter to the Hospital at Sangrur. It is only after Harnek
Singh died in the Hospital Amar Singh (PW-3) left to police station to lodge First
Information Report at 1.15 a.m on 7.5.1989. The special report sent by the police reached
the Illaqa Magistrate at 5.00 a.m. In order to determine whether the FIR was lodged at the
time it is alleged to have been recorded, the courts normally look for certain external
checks. One of the checks is the receipt of the copy of the FIR, called a special report, by
the Illaqa Magistrate. In this case, the report has been received by the Illaqa Magistrate in
time. The second external check equally important is the sending of the copy of the FIR
along with the dead body and its reference in the inquest report. This requirement is also
complied with in the present case. The inquest report clearly refers to the lodging of the
First Information Report by Amar Singh (PW-3) at 1.15 a.m. on 7.5.1989 in Police
Station, Longowal and it also refers to the registration of the First Information Report and
dispatch of special report for their delivery to the concerned authorities. Thereafter,
Malkiat Singh, ASI (PW-5) along with some constables and Amar Singh (PW-3) rushed
to the Civil Hospital, Sangrur where the inquest report has been prepared. The sequence
of events clearly reveals that there was any unexplained and unreasonable delay in
lodging the FIR. In the circumstances, it cannot be said that the FIR was ante-timed and
brought into existence after some deliberations.
12. We do not find any merit in the contention that the entries made in the DDR (Exh.
DX/1) in which it has been mentioned that the accused were armed with Sotis falsify the
First Information Report lodged by Amar Singh (PW-3). We have already noted that the
original of the DDR has not been filed into the court and what has been filed was only a
photocopy and that too at the instance of the accused after four years of the closure of
evidence. It is clearly evident from the statement of Iqbal Rai (PW-7) that the First
Information Report was recorded first and the DDR thereafter. He further stated that the
DDR had been recorded on the basis of the facts recorded in the First Information Report.
We find it difficult to comprehend as to how totally a different version is found in DDR
which is said to be a photocopy of DDR. There is obviously something more than meets
the eye. The contention that under the Punjab Police Rules information must be reduced
to writing and be entered in the police station daily diary and only thereafter the First
Information Report is to be issued is absolutely untenable. The relevant rule says:
"Every information covered by Section 154, Criminal Procedure Code must be reduced to
writing as provided in that Section and the substance thereof must be entered in the police
station daily diary which is the book provided for the purpose."
A bare reading of the rule makes it clear that every information relating to the
@page-SC446
commission of a cognizable offence, if given orally to an officer-in-charge of a police
station shall be reduced to writing and the substance thereof shall be entered in a book to
be kept in such form as may be prescribed and only thereafter in the Police Station diary.
13. Chapter XII of the Code of Criminal Procedure, 1973 deals with information to the
police and their powers to investigate. Investigation into allegations relating to
commission of a cognizable offence starts on information given to an Officer-in-charge of
a Police Station and recorded under Section 154 of the Code. If from information so
received or otherwise, the Officer-in-charge of the Police Station, if satisfied that such
information discloses the commission of a cognizable offence, shall either investigate the
case himself or direct the investigation to any police officer subordinate to him, in the
manner provided by the Code. The procedure as regards the registration of information
relating to the commission of a cognizable offence and the procedure for investigation is
structured and regulated by Chapter XII of the Code. The procedure prescribed is
required to be followed scrupulously by the Officer-in-charge of the Police Station. The
Punjab Police Rules do not in any manner override the provisions of the Code of
Criminal Procedure. The said rules are meant for the guidance of the Police Officers in
the State and supplement the provisions of the Code of Criminal Procedure but not
supplant them. In our considered opinion the truth and veracity of contents of the FIR
cannot in all cases be tested with a reference to the entries made in the police station daily
diary which is maintained under the Punjab Police Rules. This avoidable controversy
need not detain us any further since it is well settled that even a defect, if any, found in
investigation, however, serious has no direct bearing on the competence or the procedure
relating to the cognizance or the trial. A defect or procedural irregularity, if any, in
investigation itself cannot vitiate and nullify the trial based on such erroneous
investigation.
14. Amar Singh (PW-3) clearly and categorically stated that the entries in the DDR had
been recorded on the basis of the facts given in the First Information Report. It is difficult
to place any reliance upon the photocopy of the DDR that was produced before the court
after four years of the closure of evidence. There is no explanation as to the fate of
original DDR. It is not possible to doubt the timing and contents of FIR based on the
entries made in DDR. We have serious doubts about the genuineness of the very
document DDR. We wish to say no more on this aspect of the matter.
15. In our considered opinion there is no basis to contend that Amar Singh (PW-3) and
Gurmail Singh (PW-4) were not present at the scene of offence and did not witness the
incident. The contention was that Amar Singh (PW-3) and Gurmail Singh (PW-4) had not
intervened to save Harnek Singh when he was being attacked by the accused. The
evidence available on record reveals that Amar Singh (PW-3) and deceased Harnek Singh
had almost reached their house when they had been waylaid by the accused. The
appellant and Gurcharan Singh (A-3) were armed with gandasas and Mukhtiar Singh (A-
1) with a dang. As has been rightly observed by the High Court that it would be well nigh
impossible to apply a universal yardstick as to how a person would react to a given
situation. The presence of Amar Singh (PW-3) and Gurmail Singh (PW-4) cannot be
doubted on the ground that they have not made any attempt to rescue the deceased. We
cannot ignore the fact that the accused were armed with deadly weapons and the same
may have deterred PW-3 and PW-4 in making any attempt to rescue the victim when he
was under attack.
16. It is true that Gurmail Singh (PW-4) had not been able to spell out accurately the situs
of the injuries on the dead body but the same would not make his presence doubtful. The
victim was under attack from a group of persons armed with deadly weapons. He must
have made attempts to save himself from the attack and in the process may have not
remained static without moving one way or the other. One cannot expect that in such a
situation the witness would graphically describe the nature of injuries and spell out
accurately the situs of the injuries on the body of the victim. Their presence at the scene
of offence is evident from the First Information Report itself which was lodged by Amar
Singh (PW-3) himself. The fact remains Harnek Singh had been waylaid by the four
accused and thereafter inflicted several blows with the gandasas and dang.
@page-SC447
17. It is required to notice that Dr. K. S. Raikhy (PW-1) had found six injuries on the dead
body at the time of post-mortem examination. The injuries found on the body were:
1. Incised wound 12 cms x 5 cms x bone deep on the right parieto-temporal region,
wound placed obliquely bone cut and brain matter and mengis protruding through the
wound; dark clotted blood was present on the wound. On dissection underlying bone was
cut, mengis cut. The brain matter protruding through the wound haematoma was present.
2. Lacerated wound 3 cms x 2 cms on the left clavicular region. The wound was skin
deep. On dissection underlying bone was intact. Haematoma was present.
3.Incised wound 3 cms x 2 cms x 1 cm on the posterior-lateral aspect of left forearm 2
cms above the wrist joint. Dark blood clot was present. On dissection the underlying bone
was intact haematoma was present.
4. Incised wound 10 cms x 3 cms x bone deep on the antero-lateral aspect of left leg,
wound placed obliquely 3 cms below the knee joint. Dark blood clot was present in the
wound. On dissection the underlying tibia bone was cut. Haematoma was present.
5. Lacerated wound 3 cms x 3 cms x skin deep on the anterior aspect of left leg 10 cms
below the tibial tuberosity. Dark blood clot was present. On dissection the underlying
bone was intact.
6. Lacerated wound 4 cms x 2 cms x bone deep on the antero-lateral aspect of right leg 3
cms below the tibial tuberosity. Dark blood clot was present. On dissection the
underlying bone was intact.
It is in the evidence of PW-3 that Gurcharan Singh inflicted injury No. 1 by giving a
gandasa blow on the head of the victim and whereas the appellant herein inflicted injury
Nos. 3 and 4 gandasa blows on his right leg below the knee and another blow on the left
side of the chest using the reverse side of the gandasa. The appellant was armed with
deadly weapon namely gandasa. Dr. K. S. Raikhy (PW-1) stated in his evidence that the
cause of death was shock and haemorrhage and all the injuries were ante-mortem in
nature. It is further stated by him that injury No. 1 itself was sufficient to cause death in
the ordinary course of nature.
18. The learned counsel for the appellants further submitted that the injuries inflicted by
the appellant were not sufficient to cause the death of the victim and, therefore, the
common intention to kill is not evident and, therefore, he cannot be convicted for the
offence punishable under Section 302 read with Section 34 of the IPC. We are unable to
agree. The evidence of PWs-3 and 4 the direct witnesses is consistent and they had
deposed that the appellant inflicted injuries with gandasa to kill the deceased. The fact
that the appellant inflicted injuries with the deadly weapon itself shows that he had also
shared the common intention. In order to convict the person vicariously under Section 34,
it is not necessary to prove that each and every one of them had indulged in such overt act
inflicting deadly injuries. It is enough if the material available on record discloses that the
overt act of one or more of the accused was or were done in furtherance of common
intention. The common intention shared by the appellant is evident from the fact that he
was armed with deadly weapon and inflicted two injuries on the victim. All the accused
attacked the deceased and caused injuries in furtherance of the common intention to
murder the deceased. In such a situation the nature of injuries inflicted by the appellant
on the victim and whether those injuries were sufficient in the ordinary course to cause
death pales into insignificance. The appellant was not a curious onlooker and had not
accompanied the assailant who gave a deadly blow out of any ideal curiosity. Each one of
them is liable for that act of murder as if the act of murder was done by each one of them.
It is true that if the High Court had adopted this reasoning even Mukhtiar Singh (A-1) and
Gurdial Singh (A-2) could not have escaped from conviction. However, we do not
propose to express any firm opinion on that aspect of the matter since there is no appeal
by the State against their acquittal.
19. For the aforesaid reasons we find no merit in this appeal. The appeal shall accordingly
stand dismissed.
Appeal dismissed.
@page-SC448
AIR 2008 SUPREME COURT 448 "Subhash v. State of Haryana"
(From : Punjab and Haryana)*
Coram : 2 S. H. KAPADIA AND B. SUDERSHAN REDDY, JJ.
Criminal Appeal No. 1107 of 2007 (arising out of SLP (Cri.) No. 3992 of 2006), D/- 21
-8 -2007.
Subhash v. State of Haryana.
Penal Code (45 of 1860), S.392, S.397, S.300, S.304, Part II - ROBBERY - MURDER -
CULPABLE HOMICIDE - Robbery and murder - Proof - Accused person allegedly
threw deceased and other person into canal after committing robbery of money and
tractor - Nothing on record to doubt presence of said person at scene of occurrence -
Circumstances of recovery of dead body of deceased, recovery of tractor from possession
of accused and 'Barma' from possession of co-accused proved guilt - Sequence of events
revealed reasons for delay in lodging F. I. R. - Prosecution had established guilt of
appellant beyond all reasonable doubt - However, there was no intention of causing death
of deceased - Appellant is therefore liable to be convicted under Ss. 392, 397 and 304,
Part II - Sentence of 7½ years R. I. already undergone, is sufficient.(Paras 10 , 11, 12, 13,
14, 15, 16, 17)

D. P. Singh, Sanjay Jain, Rajat Singh and Ms. Pranika Singh, for Appellant; Sandeep
Sharma, Rajeev Gaur 'Naseem' and T. V. George, for Respondent.
* Cri. Appeal No. 183 D.B. of 1997, D/- 28-2-2006 (PandH).
Judgement
B. SUDERSHAN REDDY, J.:-Leave granted.
2. This appeal by special leave is directed against the judgment of the Punjab and
Haryana High Court confirming the conviction of the appellant under Section 392 read
with Section 397 IPC and the sentence of rigorous imprisonment for a period of 7 years
and under section 302 read with Section 34, IPC, imprisonment for life and a fine of Rs.
10,000/-, in default of payment of fine to undergo further two years rigorous
imprisonment. Both the sentences were directed to run concurrently. The appellant was
charged with the offences for having robbed tractor and caused the death of Raghbir
Singh-deceased.
3. The prosecution story, briefly stated, is that on 9.10.1991 Raghbir Singh(deceased)
along with Mane Ram (PW-8) after collecting 'Barma' (an instrument for drawing out
water) from Nand Lal (PW-5) resident of village Kailana left for their village- Mandi at
about 12 noon on a Swaraj make tractor. On the way when they reached at village
Pugthala they purchased half bottle of liquor from a liquor vend. Raghbir Singh
(deceased) purchased a nip of liquor separately and carried it with him. Subhash
(appellant-accused) along with son of Basu Sardar and Jai Kumar met Raghbir Singh
(deceased) and Mane Rame (PW -8) near the village Chamrara. Son of Basu Sardar took
the nip of liquor from Raghbir Singh (deceased) and consumed the same. Thereafter all
accused persons went to the house of son of Basu Sardar and again consumed illicit
liquor. After consuming illicit liquor they came back at the place where they had met
Mane Ram (PW-8) and Raghbir Singh (deceased). An altercation took place among son
of Basu Sardar, Subash (appellant-accused) and Jai Kumar wherein the son of Basu
Sardar inflicted injury upon the head of Subhash (appellant-accused) and fled away.
Subhash (appellant-accused) was brought to the village Pugthala in order to get his
wound dressed up from a doctor on the tractor of Amar Singh being driven by Joginder
Singh (accused). Thereafter Joginder (accused) took the tractor towards village Bajana on
the bank of canal. When they reached near the bridge of canal in the village Kasandi
Joginder accused stopped the tractor on which the accused persons started robbing of
money from the pocket of Raghbir Singh (deceased). It was about 8.00 P.M. Enraged by
the intervention of Mane Ram (PW-8) all the accused persons caught hold of Mane Ram
and pressed his neck and threw him into the canal. Thereafter accused persons caught
hold of Raghbir Singh (deceased) by his legs and also threw him into the same canal.
Raghbir Singh (deceased) tried to catch hold of the grass grown on the bank of the canal.
Jai Kumar (accused) and Joginder Singh (accused) gave leg blows on the face of Raghbir
Singh and again thrown into the water and he did not come out of the canal. Mane Ram
(PW-8) knew swimming and came out of the canal after having covered a distance of
three acres and narrated the incident to Jai Singh a resident of village Kasandi. Thereafter,
Mane Ram (PW-8) along with Jai Singh searched for Raghbir Singh (deceased) and the
tractor
@page-SC449
belonging to Amar Singh (PW- 6) but they could not find them. Then Mane Ram (PW-8)
and Jai Singh went to village Mandi. It was about mid-night. They narrated the
occurrence to father of Raghbir Singh (deceased). They went to the city police station,
Gohana. Police party along with Mane Ram (PW-8) and Jai Singh reached at the place of
occurrence at about 10.00 A.M on 10.10.1991 and recorded the statement of Mane Ram
(PW-8). Based on the statement of Mane Ram (PW-8) the Police Station Gohana issued
first information report and registered a P.S. Case No. 259 on 10.10.1991 under Section
392 read with Sections 397 and 302 read with Section 34, IPC against the appellant.
4. After completion of the investigation, the police filed charge sheet under Section 392
read with 397 IPC and under Section 302 read with 34 IPC against all the accused
including the appellant. The prosecution in all examined 11 witnesses (PW?1 to PW-11)
and got marked various documents in evidence. The statement of the accused appellant
under Section 313 Cr.P.C. was recorded in which he took the stand that he was innocent
and falsely implicated of the charge levelled against him
5. The learned Sessions Judge upon appreciation of evidence available on record found
the appellant guilty of the offence punishable under Section 392 read with 397 and 302
read with 34, IPC and the same was affirmed by the High Court.
6. Hence this appeal by special leave.
7. We have heard Shri D.P. Singh, learned counsel appearing on behalf of the appellant-
accused and Shri Sandeep Sharma, learned counsel appearing for the State.
8. In order to consider as to whether the prosecution established the charge against the
appellant for the offence punishable under Section 392 read with 397 and 302 read with
34 IPC beyond reasonable doubt it is just and necessary to appreciate the evidence
available on record.
9. In the facts and circumstances of the case, it is not necessary to consider in detail the
statements of all the prosecution witnesses except PW-8. In our view, the prosecution
case entirely rests on the testimony of Mane Ram ( PW-8) who is an independent and
impartial witness. He deposed that the accused persons threw him and Raghbir Singh
(deceased) into the canal after robbing money and the tractor. The relevant portion of his
testimony is as under:
"The accused started robbing of money from the pocket of Raghbir (deceased). On my
intervention, all the accused caught hold of me and pressed by neck and threw me in
canal. It was about 8 P.M. After throwing me in the canal, the accused caught hold of
Raghbir deceased by the legs and also threw him in the canal. Raghbir deceased tried to
catch hold of the grass grown on the bank of the canal. Thereafter, accused Joginder and
Jai kumar gave leg blows on the face of Raghbir deceased. Thereafter Raghbir was again
thrown in the water and did not come out whereas I kept on swimming with the flow of
water and came out of the canal after having covered a distance of about three acres.
After having out of the water I went to V. Kasandi. I had not seen the tractor on the bank
of the canal."
10. The learned counsel for the appellant urged before us that the prosecution fabricated
the evidence to falsely implicate the appellant. The learned counsel for the appellant
further contended that the presence of PW-8 at the scene of occurrence is highly doubtful.
This theory which is now sought to be propounded is contrary to the very defence set up
by the appellant in the sessions case as is evident from the cross-examination of PW-8. It
was suggested to PW-8 that he along with Raghbir (deceased) in a drunken condition was
present at the Kasandi bridge (scene of occurrence) and they were unable to control
themselves and Raghbir laid on the bank of the canal and accidentally fell into the water
and drowned. This suggestion made to PW-8 that PW-8 along with Raghbir Singh
(deceased) was very much present at the scene of occurrence completely negatives the
submission now made by the appellant's counsel. There is nothing on record to doubt the
presence of PW-8 at the scene of occurrence. Nothing has been suggested to PW-8 as to
why he should have given false evidence against the appellant.
11. We also do not found any merit in the contention of the learned counsel for the
appellant that no specific overt act has such been attributed to the appellant and,
therefore, he is entitled to acquittal of the offence alleged against him. PW-8, in clear and
categorical terms in his evidence stated that Joginder Singh all of a sudden stopped the
tractor when it had reached at the spot in
@page-SC450
between two canals near the bridge of canal in village Kasandi. That all the accused
started robbing of money from the pocket of Raghbir (deceased) and when he intervened
all the accused caught hold of him and pressed his neck and he was thrown into the canal.
That after throwing PW-8 into the canal all the accused caught hold of Raghbir
(deceased) by his legs and threw him into the canal. Raghbir (deceased) tried to catch
hold of the grass grown on the bank of the canal but the accused gave blows on the face
of Raghbir (deceased) and was again thrown into the water. Raghbir (deceased) did not
come out from the water.
12. The evidence and material available on record further reveal circumstances to prove
the guilt of the appellant: (1) The first circumstance is the recovery of the dead body of
Raghbir Singh (deceased) from the place of occurrence. (2) The sub-Inspector Man Singh
(PW-11) recovered the Tractor No. HR-06-8501 from the possession of the accused
persons which was the same tractor robbed by the accused. (3) The third circumstance is
recovery of 'Barma' by Sub-Inspector Man Singh (PW-11) from the possession of
Joginder Singh (co-accused) in pursuance of his disclosure statement.
13. The learned counsel vehemently contended that there is no proper explanation
forthcoming from the prosecution for the delay in lodging the first information report and
the same casts a serious doubt on the case set up by the prosecution against the appellant.
We are not impressed by the submission as the evidence available on record reveals the
sequence of events leading to filing of first information report. The distance between the
Kasandi bridge and Mandi is about 10-12 kms. It is in the evidence of PW-8 that after his
coming out of the canal he went to village Kasandi and met Jai Singh and narrated the
whole story to him; thereafter along with Jai Singh he returned to the scene of occurrence
and searched for Raghbir (deceased) and the tractor but could not find them. Thereafter
along with Jai Singh he went to Mandi on his tractor and narrated the story to the father
of the deceased about the occurrence who reported the matter to the Sarpanch of the
village. Thereafter he along with Jai Singh went to police post Israna who refused to
lodge the report but informed the Gohana police. It is true that the distance between the
Kasandi bridge and the police station Gohana is 5 kms. but PW-8 and his evidence had
narrated the sequence of events which reveals the reasons for the delay, if any, in lodging
the first information report at police station Gohana. There is nothing unnatural on the
part of PW-8 in his first going to Kasandi village nearby to the scene of occurrence and
informing Jai Singh about the incident and thereafter returning to Kasandi bridge along
with Jai Singh. Having found the deceased-Raghbir Singh and the tractor were missing he
along with Jai Singh went to Mandi village to inform the father of the deceased. One does
not expect PW-8 to straightway first go to the nearest police station and lodge the first
information report even without informing the near relatives of the deceased.
14. Be that as it may, it is not the case of the appellant that after occurrence of the
incident some deliberations took place in order to falsely implicate the appellant in the
case. No suggestion of any enmity between the appellant and PW-8 has been made. There
is no reason to disbelieve the sequence of events narrated by PW-8. In such view of the
matter mere delay in lodging the first information report, in the facts and circumstances
of the case cannot be held to be fatal to the prosecution case.
15. For all the aforesaid reasons we hold that the prosecution has been able to establish
the guilt of the appellant beyond all reasonable doubt for conviction under Section 392
read with 397 IPC for having robbed money and tractor. The sentence of rigorous
imprisonment for a period of 7 years for each of the offence under Section 392 read with
397 IPC is accordingly upheld.
16. The question that falls for our consideration is whether the facts and circumstances
and the evidence available on record justify the conviction of the appellant under Section
302 read with 34 IPC for having caused death of Raghbir (deceased)? The evidence
available on record does not suggest that there has been any intention of causing the
death of Raghbir (deceased).The case falls under Part II of Section 304 IPC. The
appellant committed the offence of culpable homicide not amounting to murder. The
appellant is accordingly convicted under Part II of Section 304, IPC and sentenced to
undergo rigorous imprisonment for 7 years. The sentences to run concurrently.
17. It is brought to our notice that the appellant has already served the sentence
@page-SC451
of 7½ years rigorous imprisonment. Sentence already undergone is sufficient to meet the
ends of justice. He is accordingly directed to be released forthwith, unless required in
connection with any other case.
18. The appeal is accordingly allowed in part.
Appeal partly allowed.
AIR 2008 SUPREME COURT 451 "Zenith Steel Tubes and Industries Ltd. v. Sicom
Limited"
(From : Bombay)*
Coram : 2 ALTAMAS KABIR AND B. SUDERSHAN REDDY, JJ.
Civil Appeal No. 5347 of 2007(@ SLP (C) No. 8486 of 2007), D/- 21 -11 -2007.
Zenith Steel Tubes and Industries Ltd. and Anr. v. Sicom Limited.
Sick Industrial Companies (Special Provisions) Act (1 of 1986), S.22 - SICK
INDUSTRIAL UNDERTAKING - LARGER BENCH - Term "proceedings" or "suits" in
S. 22 - Interpretation of - Divergent views expressed in decisions by Coordinate Benches
in 2006 AIR SCW 5718 and 2003 AIR SCW 1358 - Matter referred to larger Bench.
(Para 25)
Cases Referred : Chronological Paras
2006 AIR SCW 5718 : AIR 2007 SC 168 : 2006 CLC 1655 9, 11, 22, 24
2003 AIR SCW 1358 : AIR 2003 SC 1886 : 2003 CLC 339 10, 11, 17, 18, 19, 21, 22, 23,
24
2001 (106) Comp Cas 587 (Bom) 19
2000 AIR SCW 521 : AIR 2000 SC 926 : 2000 CLC 453 20
2000 AIR SCW 2740 : AIR 2000 SC 2553 : 2000 CLC 1492 8, 10, 17
AIR 1998 Bom 247 8
1993 AIR SCW 991 7, 10
AIR 1989 SC 2240 15
AIR 1978 SC 1765 21
AIR 1970 SC 196 : 1970 Lab IC 256 14
AIR 1940 PC 105 15
Shekhar Naphade, Sr. Adv., Shivaji M. Jadhav, Himanshu Gupta, Brij Kishor Sah and
Rahul Joshi, for Appellants; Jay Savla and Ms. Meenashi, for Respondent.
* Appeal No. 1 of 2007 in Misc. Petn. No. 64 of 2000, D/- 29-1-2007 (Bom)
Judgement
ALTAMAS KABIR, J. :- Leave granted.
2. The appellant No.1 company was carrying on business of manufacturing galvanised
pipes. In November, 1992 the appellant-company approached the respondent for financial
assistance amounting to Rs.1,42,000/- to meet a part of the cost for setting up a factory in
village Madap, Taluq Kolhapur in the District of Raigarh for the manufacture of
galvanised pipes. The said amount was duly sanctioned and the said sum of
Rs.1,42,000/- was advanced by the respondent to the appellant company. An agreement
was entered into for a term loan and the appellant-company also created a security for
repayment of the amount by hypothecating its plant and machinery and creating an
equitable mortgage of its factory premises situated in the above mentioned village. A loan
agreement was executed on 30.3.1993 for repayment of the loan in various instalments.
On the same day, the second appellant executed a personal guarantee for repayment of
the loan amount in case of default by the appellant-company.
3. The appellant-company committed several defaults in repayment of the loan amount
compelling the respondent to issue a notice on 16.10.98 calling upon the appellant-
company to pay the overdue amount within a stipulated period. Despite such notice, the
appellant-company failed to make payment and accordingly, by a further notice dated
10.1.1999 the respondent called upon the appellant-company to repay the entire amount
due and payable to the respondent by 3.2.1999 failing which the possession of the assets
of the appellant-company would be taken on 5.2.1999.
4. Since, despite such notice the appellant-company failed and neglected to pay the entire
amount as demanded, the respondent issued a notice to the appellant No.2 on 13.6.2000
calling upon him to pay the entire amount by invoking the personal guarantee given by
the second appellant. As in the case of the appellant-company, the second appellant did
not also make the payment as demanded, and consequently, the respondent filed a
petition against the second appellant under Section 31(1)(aa) of the State Financial
Corporations Act, 1951, on 10.10.2000 for enforcing the personal guarantee given by the
said appellant.
5. In the meantime, the appellant-company applied to the Board for Industrial and
Financial Reconstruction (BIFR) and was declared a sick company by the BIFR under the
provisions of the Sick Industrial Companies (Special Provisions) Act, 1985, (SICA), and
the company is still under the said
@page-SC452
Board.
6. Taking advantage of the aforesaid position, the second appellant contended before the
single Judge of the Bombay High Court that in view of Section 22 of the aforesaid Act,
the personal guarantee given by the second appellant could not be invoked. It was also
contended that the respondent could not enforce the guarantee till such time as the assets
which had been mortgaged in its favour had not been realised. Both the said contentions
were rejected by the learned single Judge upon holding that the liability of the guarantor
was independent of that of the principal debtor, and accordingly, the guarantee could be
invoked and the amount could be recovered from the guarantor. The guarantor was
directed to pay Rs.1,67,89,225/- with further interest on the principal amount of Rs.92
lakhs from the date of the petition till payment at the rate of 12%. The said decision of the
learned single Judge was challenged by the appellants herein before the Division Bench
of the Bombay High Court in Appeal No.1/2007. The Division Bench on consideration
of the different decisions of this Court came to the conclusion that the provisions of
Section 22 of SICA, as amended in 1994, did not prohibit any proceeding, other than a
suit for enforcement of any security against the guarantor. On such finding and also upon
holding that the liability of the guarantor was co-extensive with the principal debtor and
that the creditor was not required to exercise his right as a mortgagee before proceeding
against the guarantor, the Division Bench dismissed the appeal with costs on 29.1.2007.
It is the decision both of the learned single Judge as also the Division Bench of the High
Court which is the subject matter of this appeal.
7

. Appearing in support of the appeal, Mr. Shekhar Naphade, learned Senior Advocate,
submitted that both the learned single Judge and the Division Bench of the High Court
had erred in giving a narrow meaning to the word 'suit' as used in Section 22 of SICA. He
submitted that the context in which the expression 'suit' had been used in Section 22 of
the aforesaid Act made such expression all pervasive to include other proceedings as well
before a court or other authority empowered to recover debts and other dues against the
company. It was urged that in the case of Maharashtra Tubes Limited v. State Industrial
Corporation of Maharashtra Ltd. (1993) 2 SCC 144, it had been held that the expression
"proceedings" in Section 22(1) of SICA must be widely construed and could not be
confined to legal proceedings understood in the narrow sense of proceeding in a court of
law or a legal tribunal for attachment and sale of the debtor's property. However, since
the said decision could be applied to companies only and not to guarantors, the legislature
amended the provisions of Section 22(1) so as to extend the protection given to
companies to guarantors also so that they too were given the protection of Section 22 of
the Act. Mr. Naphade submitted that the object with which the 1985 Act was enacted was
primarily to assist sick industries which had failed to meet their financial obligations. It
was urged that in certain cases it was the Directors of the company who themselves stood
guarantee for the loans advanced to the company and the enforcement of such guarantee
against the Directors would cause obstructions in the way of the BIFR to revive the said
company, which was also one of the objects of the 1985 Act. 1993 AIR SCW 991

. In this regard, Mr. Naphade also referred to the decision of this Court in Patheja Bros.
Forgings and Stamping and Anr. v. ICICI Ltd. and others, 2000 (6) SCC 545, where the
question involved was whether Section 22 of the SICA would cover a suit against a
guarantor of a loan or advance that had been granted to an industrial company. Mr.
Naphade pointed out that upon holding that the words of Section 22 were crystal clear
and there was no ambiguity therein, this Court had held that no suit for enforcement of a
guarantee in respect of a loan or advance granted to the industrial company concerned
would lie or could be proceeded with without the consent of the Board or the Appellate
Authority under the Act. Mr. Naphade also submitted that while dealing with the
aforesaid question, this Court had overruled the decision of the Bombay High Court in
Madalsa International Ltd. v. Central Bank of India, AIR 1998 Bom 247, wherein it had
been held that Section 22 would apply to companies only and not to guarantors who
would be affected personally and the words "of any guarantee in respect of any loan or
advance granted to the industrial company" would have to be read as the guarantee given
by the industrial 2000 AIR SCW 2740

@page-SC453
company itself and none else.
9

. To emphasise his aforesaid submission Mr. Naphade laid particular emphasis on the
decision of this Court in Paramjit Singh Patheja v. ICDS Ltd. (JT 2006 (10) SC 41) where
in connection with the enforcement of an arbitral award and the issuance of an insolvency
notice under Section 9(2) of the Presidency Towns Insolvency Act, 1909 this Court, inter
alia, held that it is a well established rule that a provision must be construed in a manner
which would give effect to its purpose and to cure the mischief in the light of which it
was enacted. It was further observed that the object of Section 22 of SICA in protecting
guarantors from legal proceedings pending a reference to BIFR by the principal debtor
was to ensure that a scheme for rehabilitation would not be defeated by isolated
proceedings adopted against the guarantors of a sick company. In order to achieve such
purpose, it was imperative that the expression "suit" in Section 22 be given its plain
meaning, namely, any proceedings adopted for realisation of a right vested in a party by
law. 2006 AIR SCW 5718

10

. Mr. Naphade then submitted that the Bombay High Court had wrongly relied upon the
decision of this Court in Kailash Nath Agrawal and Ors. v. Pradeshiya Industrial and
Investment Corporation of U.P. Ltd. and Anr. (2003 (4) SCC 305), wherein the decision
rendered by this Court in the Maharashtra Tubes' case (supra) as also in Patheja Bros.
Forging case (supra) were distinguished and it was held that in both the cases while
considering the effects of the amendment to Section 22(1) of SICA, the Courts were
concerned with 'suits' which had been dealt with in the case of Patheja Bros, and not with
'proceedings' indicated in the first part of Section 22(1) of the 1985 Act. Mr. Naphade
added that the decision in the Maharashtra Tubes' case (supra) had been rendered prior to
the amendment of Section 22(1) of SICA, where as Patheja's case, as also the case of
Paramjit Patheja were rendered after the amendment was effected, to extend the
protection of Section 22 to guarantors as well. 2003 AIR SCW 1358
1993 AIR SCW 991
2000 AIR SCW 2740
11

. Mr. Naphade submitted that the decision in Kailash Nath Agrawal's case had been
rendered by this Court in the context of interpretation of the expressions 'suit' and
'proceedings' used in Section 22(1) of SICA, 1985. In construing the said two expressions
this Court was of the view that while the expression 'proceedings' used in Section 22(1)
would have to be confined to companies alone, the expression 'suit' had been introduced
by amendment to extend the protective cover of Section 22 to guarantors as well. It was
submitted that the purpose for which such amendment had been effected, namely, to
extend the protective cover of Section 22 to guarantors also, would be rendered
meaningless if coercive action continued to be taken against guarantors who could even
be the Directors of the company in question. It was urged that the continuing ambiguity
was sought to be explained in the Paramjit Singh Patheja case (supra) wherein it was
explained that the expression 'suit' would have to be understood in a larger context to
include other proceedings as well before a legal forum. 2003 AIR SCW 1358
2006 AIR SCW 5718

12. Mr. Naphade submitted that, in any event, the liability of the appellant No. 2 under
the guarantee given could be enforced under Section 31((1)(aa) of the State Financial
Corporations Act, 1951, only if and when the appellant made a default in repayment of
the loan. Having regard to the fact that the appellant No.1 had made a reference to the
BIFR under Section 15 of the 1985 Act, the liability of the appellant-company stood
suspended under Section 22 of the said Act. As the liability of the appellant-company
stood suspended, there could be no question of any default having been committed by the
appellant company towards repayment of the loan. According to Mr. Naphade, since the
respondent had filed an application under Section 31(1)(aa) of the above Act making only
a monetary claim against the appellant No.2, on a true construction of the above
provisions the said Section permits enforcement only of the security given by the
guarantor and since in the instant case the respondent had filed an application not for
enforcement of any security but for claiming only the amount of guarantee the same
could not be enforced against the appellant No. 2. According to Mr. Naphade the
appellant No. 2 has not given any other security which could be proceeded against by the
respondent.
13. Mr. Naphade submitted that the Bombay High Court had no jurisdiction to
@page-SC454
entertain the application made under Section 31(1)(aa) of the Act and the order passed
there above was a nullity.
14

. It was also submitted that I.A. No.1 of 2007 was filed in the special leave petition for
leave to place on record additional grounds as set out in the application and prayed that
the same be allowed to be placed on record by way of additional grounds. Inasmuch as,
such prayer was objected to on behalf of the respondent, Mr. Naphade referred to the
decision of this Court in the Management of State Bank of Hyderabad v. Vasudev Anant
Bhide etc., 1969 (2) SCC 491, wherein while considering as to whether a claim was
barred under Article 137 of the Limitation Act, an objection was taken that such ground
had not been raised either before the Labour Court or even in the special leave petition
filed in this Court. In the said case, on an application made to permit the appellant to raise
the question of limitation based upon Article 137 of the Limitation Act, this Court
permitted the appellant to raise such plea as no fresh facts were required to be
investigated and the matter could be dealt with as a pure question of law. AIR 1970 SC
196

15

. Mr. Naphade also referred to the decision of this Court in Pandurang Ramchandra
Mandlik v. Shantibai Ramchandra Ghatge and Ors. (1989 Supp (2) SCC 627) which was
a case dealing with ousting of jurisdiction of the Civil Court with regard to the provisions
of Section 80 and Section 85 of the Bombay Tenancy and Agricultural Lands Act, 1948.
Referring to the decision of the Judicial Committee in Secretary of State v. Mask and
Company (AIR 1940 PC 105), where it was observed that the exclusion of the
jurisdiction of the Civil Court was not to be readily inferred, but that such exclusion must
either be explicitly expressed or clearly implied, it was held that there was nothing in the
language or context of Section 80 or Section 85 of the above Act to suggest that the
jurisdiction of the Civil Court was expressly or by necessary implication barred with
regard to the question as to whether the defendants have become statutory owners of the
land. AIR 1989 SC 2240

16. Mr. Naphade concluded his submissions by urging that both the learned single Judge
and the Division Bench of the Bombay High Court had misconstrued the provisions of
Section 22 of the 1985 Act, as amended, in holding that the amended provisions granting
protection to guarantors in suits for enforcement, could not be stretched to include
proceedings for enforcement as well.
17

. Appearing for the respondent, Mr. Jay Savla, learned advocate, contended that the
controversy regarding the protection given by Section 22 of SICA to guarantors had been
set at rest by this Court in Kailash Nath Agrawal's case (supra). He submitted that while
in the case of Patheja Bros. Forgings and Stamping case (supra) this court had to
consider whether a suit against a guarantor would be covered by the protection provided
under Section 22(1) of SICA, the question in Kailash Nath Agrawal's case this Court was
concerned not with a "suit" but a proceeding for recovery of dues and in those
circumstances this Court had examined the use of the expressions "proceeding" and "suit"
used in different parts of Section 22(1) of SICA. It was in that context that this Court
distinguished the earlier decision in Patheja Bros. Forgings and Stampings case and upon
holding that since the legislature had expressly chosen to make a distinction between
suits for recovery of money and enforcement of guarantees and proceedings for the
recovery of money, such distinction had to be given effect to. It was held that even under
the amended provisions only a limited protection had been afforded to guarantors with
regard to the recovery of dues by way of suit, but not by way of proceedings, and,
accordingly, a proceeding for recovery of money against a guarantor would stand outside
the protection afforded under Section 22(1) of the 1985 Act. 2003 AIR SCW 1358
2000 AIR SCW 2740

18

. It was urged that in the instant case, a situation similar to that in Kailash Nath Agrawal's
case had arisen, since the proceeding had been initiated against the guarantor under the
relevant provisions of the State Financial Corporations Act, 1951, which stood outside the
purview of Section 22(1) of SICA. 2003 AIR SCW 1358

19. Mr. Savla submitted that although the decision in Kailash Nath Agrawal's case was
not referred to by the Division Bench of the Bombay High Court, a similar decision
rendered by the Division Bench of the Bombay High Court in Dewal Singhal v. State of
Maharashtra (2001 (106) Company Cases 587) was relied upon. In the said decision it
was held that the protection conferred on
@page-SC455
guarantors under Section 22 of SICA is a limited protection and the bar is restricted only
to a suit and did not apply to any other proceedings.
20

. Mr. Savla referred to the decision of this Court in BSI Ltd. and Anr. v Gift Holdings Pvt.
Ltd. and Another, (2000 (2) SCC 737), which was rendered in a slightly different
situation involving a fine imposed on a company in a criminal case against the company
and its Directors under Section 138 of the Negotiable Instruments Act, 1881. It was held
in that case that the ban envisaged in Section 22(1) of SICA would not be attracted in
case of punishment of fine imposed on the company for such offence if it was with the
consent of the BIFR. Furthermore, the ban imposed under the said provision of SICA
against maintainability of a suit for recovery of money would not cover prosecution
proceedings for an offence under Section 138 of the Negotiable Instruments Act. This
Court observed that as the ambit of "suit" has been clearly delineated in Section 22(1)
itself, it could not be stretched by employing the maxim that contemporaneous exposition
is the best and strongest in law. 2000 AIR SCW 521

21

. Mr. Savla urged that a proceeding under the State Financial Corporations Act could not
be equated with a suit as had been held by this Court in Gujarat State Financial
Corporation v. M/s. Natson Manufacturing Co.(P) Ltd. (1979 (1) SCR 372) and having
regard to the decision in Kailash Nath Agrawal's case (supra) such a proceeding would
not be entitled to the protection envisaged under Section 22(1) of SICA. AIR 1978 SC
1765
2003 AIR SCW 1358

22

. As to the second limb of Mr. Naphade's submission regarding the right of the respondent
to proceed against the guarantor before realising its securities, Mr. Savla reiterated the
High Court's view that the claim against the guarantor was against him personally and
was independent of the sureties given in mortgage by the Principal Debtor. Mr. Savla
submitted that the decision rendered in Kailash Nath Agrawal's case does not appear to
have been brought to the notice of the Hon'ble Judges deciding the Paramjeet Singh
Patheja case (supra) and same was decided on other earlier decisions of this Court which
dealt essentially with suits for recovery of dues. 2003 AIR SCW 1358
2006 AIR SCW 5718

23. It was submitted that since the Division Bench of the High Court took a view which
finds support in Kailash Nath Agrawal's case, no case had been made out for interference
with the same.
24

. In the decisions of this Court cited before us, two divergent views have been expressed
in respect of the same issue involved in this appeal. In the other decisions, this Court had
no occasion to go into the said issue which involved the interpretation of the Section
22(1) of the SICA in respect of either proceedings or 'suits' respectively. In Kailash Nath
Agrawal's case (supra) this Court has taken the view that the legislature appears to have
knowingly used two different expressions in Section 22(1) of SICA, namely, 'proceeding'
in the first part and the expression 'suit' in the second part and the protection of Section
22 extended to guarantors in respect of suits alone and the use of the expression
'proceeding' could not be extended to include suits as well nor could the expression 'suit'
be extended to include the expression 'proceeding' also. On the other hand, in Paramjeet
Singh Pathejas case (supra) it was held that the expression 'suit' which extends the
protection of Section 22(1) to guarantors, would have to be interpreted to include
'proceeding' also, in view of the intention of the legislature to protect sick industrial
companies where references were pending before the BIFR. It is also evident from the
decision in Paramjeet Singh Patheja's case (supra) that the views expressed in Kailash
Nath Agrawal's case (supra) had not been brought to the notice of the learned Judges who
decided the matter. Even if we are inclined to agree with one of the two interpretations,
the anomalous situation will continue since the decisions are that of coordinate Benches.
2003 AIR SCW 1358
2006 AIR SCW 5718

25. In such circumstances, we consider it fit and proper that the matter should be referred
to a larger Bench to resolve the existing anomaly resulting from the different views
expressed in the two above-mentioned cases.
26. Accordingly, the Registry is directed to place this matter before the Hon'ble the Chief
Justice of India for appropriate orders in the light of what has been stated hereinbefore.
Order accordingly.
@page-SC456
AIR 2008 SUPREME COURT 456 "O. N. G. C. Ltd. v. Garware Shipping Corporation
Ltd."
(From : Bombay)*
Coram : 2 Dr. A. PASAYAT AND S. H. KAPADIA, JJ.
Civil Appeal No. 5210 of 2007 (arising out of SLP (C) No. 15036 of 2005), D/- 14 -11
-2007.
O. N. G. C. Ltd. v. Garware Shipping Corporation Ltd.
(A) Arbitration and Conciliation Act (26 of 1996), S.34 - ARBITRATION AND
CONCILIATION - Award - Setting aside - Charter of ships by ONGC - Dispute over
computation of cost of repairs and maintenance (R and M) of vessels to be paid to
lessors - Arbitrator passing award on basis that year of operation of vessel would be
relevant factor for cost of R and M - Terms of agreement fixing a normative value as per
SCI vessels, escalation @ 9.5% per year and reimbursement of difference between
normative amount given and the actual R and M expense of SCI's ships of 5400 BHP -
Stress, therefore, is on reimbursement - Year of operation is thus immaterial - Award
passed on year of operation basis liable to be set aside. (Para 27)
(B) Arbitration and Conciliation Act (26 of 1996), S.34 - ARBITRATION AND
CONCILIATION - Setting aside of award - Award based on wrong basis and perverse
conclusions - Liable to be set aside - No proposition that Courts could be slow to interfere
with arbitrator's Award, even in such cases. (Para 28)

Ashok Desai, Sr. Advocate, Gopal Jain, Vipin Nair, P. B. Suresh, Ms. Mridul (for M/s.
Temple Law Firm), for Appellant; R. F. Nariman, Mukul Rohatgi, Sr. Advocates, Biren
Saraf, Santosh Paul, Abhishek K. Rao, Praji K. J., M. J. Paul, for Respondent.
* Appeal No. 57 of 2005 in A. P. No. 329 of 2004, D/- 1-3-2005 (Bom).
Judgement
Dr. ARIJIT PASAYAT, J. :-Leave granted.
2. Challenge in this appeal is to the judgment rendered by a Division Bench of the
Bombay High Court dealing with an appeal questioning the correctness of the order
passed by a learned Single Judge who dismissed the appellant's appeal under Section 34
of the Arbitration and Conciliation Act, 1996 (in short the Act) questioning the Arbitrators
award.
3. The controversy lies within a very narrow compass.
4. The factual background is almost undisputed and is essentially as follows:
The appellant required off shore vessels (in short OSVs) inter alia, for supplying material
from its onshore bases to its offshore installations. After initially meeting its requirements
by chartering foreign OSVs, the appellant decided to develop a fleet of Indian Flag
vessels. Various Indian companies including the respondent and the Shipping Corporation
of India (in short SCI) acquired OSVs, with a view to chartering them to the appellant.
The respondent acquired five vessels (named Garware I to Garware V) which were
handed over to the appellant in the months of November and December, 1983 and
January and March, 1984.
The dispute pertains to the cost of repairs and maintenance of the respondent's OSVs for
the eleventh to the sixteenth year of their operation. Even though there is no dispute
regarding the first two terms of five years each, reference to the manner in which the
rates for the same were arrived at is necessary. A working group under the Director
General of Shipping was constituted by the Ministry of Petroleum to determine the floor
day rate in respect of the vessels keeping two objects in mind, i.e. (a) long term
availability of the OSVs for the appellant and (b) economic viability to ensure the
respondents survival in the business. The report was submitted by the working group on
8.3.1984 suggesting the day rate which comprised of two components, i.e. (a) capital
recovery factor and (b) operating expenses. Contracts were accordingly entered into for
the first five year period beginning from 1983-84. The Government of India by an order
dated 18.8.1984 approved the report in certain respects only. There is no dispute between
the parties regarding the payments of operating costs for the first five years. The charter
was extended by another five years. A committee presided over by Dr. A.N.Saxena was
formed to review the operating costs payable for the extended term. The Government
approved the report of the Committee on 5.8.1993. There is no dispute between the
parties in respect of the payments regarding the second five year period also.
5. The present dispute relates to the period beyond ten years so far as relates to
@page-SC457
the basis for computing the rates for repairs and maintenance. By an order dated
29.4.1993 the charter was extended by a further six years. By an order dated 16.3.1995
and as modified by an order dated 14.9.1995, a committee also presided over by Dr. A.N.
Saxena was formed to recommend a suitable formula for the charter rate for the further
extended period.
6. The committee submitted its report on 14.9.1997. This committee made
recommendations inter alia in respect of repair and maintenance expenses. The reference
to arbitration was confined only to the payment of these repairs and maintenance
expenses.
7. The Government of India by a letter dated 15.6.1998 accepted the recommendations of
the second Dr. A.N. Saxena Committee only partially. Representations were thereafter
made by the Indian Shipping Companies including the respondent for reconsideration of
the recommendations. Pursuant thereto, the Government of India appointed a High Level
Working Group presided over by Mr. Naresh Narad for considering the outstanding
pending issues. The following recommendations of the High Power Committee are
relevant:

?Pending Issues.
1. Determination of year from which R and M expenses are to be actualized. a) 1 to
5 years as per payments already made. Settled cases Not to be reopened.
b) 6 to 10 years as per norms fixed by Dr. Saxena Committee of 1995-77.
c) 11 and 12 years to actualized on the basis of S.C.Is OSVs as recommended by Dr.
Saxena Committee of 1995-77.?

8. Disputes and differences arose between the appellant and inter alia the respondent and
others regarding the method to the adopted for calculating rates payable with reference to
the eleventh to the sixteenth years. The respondent, therefore, filed Writ Petition No.2788
of 2001 for various reliefs.
9. By an order dated 7.12.2001 a Division Bench of the High Court recorded that the Writ
Petition involved certain contractual disputes and that both the parties had agreed to refer
the disputes raised in the Writ Petition to the sole arbitration of Mr. Justice M.L.Pendse (a
former Judge of the Bombay High Court and the former Chief Justice of the Karnataka
High Court). The order which is a short one, reads as follows:
"This writ petition involves certain contractual disputes relating to repairs and
maintenance expenses etc. contract between the parties contain an arbitration clause.
Both the parties agree to refer the disputes raised in the writ petition to sole arbitration of
Justice M.L. Pendse (Retd.). Parties further agree that in case Justice Pendse is not in a
position to take up the arbitration, Justice D.R. Rege (Retd.) shall be the arbitrator for the
disputes between the parties. Arbitrator is requested to dispose of the arbitration as
expeditiously as possible.
Petition is disposed of."
10. The learned arbitrator noted the respondents submission that while calculating the
payments due for the 11th to 16th years of the operation of the OSVs of the respondent,
the appellant has overlooked the important fact that the OSVs of the respondent were
taken on charter one year prior to the appellant obtaining the OSVs of the SCI. The
respondent, therefore, contended that it was not correct that the corresponding years of
SCI should be taken into account while determining amounts payable to the respondent.
The learned arbitrator rejected the appellants contention. He held that the committee
nowhere recommended that irrespective of the period of induction,
@page-SC458
the years should be calculated of that of the SCI. He held that the respondent had not
questioned the recommendations made by the High Level Working Group Report and the
second Saxena Committee Report but merely contended that the mode of implementation
thereof was incorrect. The arbitrator further observed and accepted that it was not open
for him to go behind the report and the only area of enquiry is whether or not the report
was correctly implemented. He came to the conclusion that on a close scrutiny of the
reports, it was clear that neither of the committees examined whether the entitlement of
each OSV is to be determined with reference to the years of actual user or only with
reference to the calendar years. He also came to the conclusion that for the computation
of repairs and maintenance expenses, it was necessary to take into consideration the years
of operation and not the calendar years. It was held that the 12th year of operation of
SCIs OSVs should be equated with the 13th year of operation of the OSVs of the
respondent and so on. He also held that the interpretation suggested by the appellant
would lead to great injustice. For instance, the OSV of the respondent would complete 11
years of operation while the OSVs of the SCI would have operated only for 10 years.
11. Appellant questioned correctness of learned Arbitrators conclusion by filing an appeal
under Section 34 of the Act. Learned Single Judge dismissed the appeal holding that the
conclusion was rational. An appeal filed was also dismissed.
12. According to the Division Bench, the learned arbitrator has considered and construed
the reports while arriving at his conclusions. The entire dispute in the Writ Petition and
before the learned arbitrator centered around this issue. The basis of the calculation
adopted by the learned arbitrator was, not only logical but just and fair. The provisions of
the said reports are not such that they required no interpretation and were merely to be
applied without anything more. They called for a proper interpretation and construction
before being applied to the facts of the case. The learned arbitrator did so.
13. The learned Single Judge held that undoubtedly there was no reference so far as the
period of 13 to 16 years are concerned to the learned Arbitrator. But the prayers and the
writ petitions clearly indicated that even for that period an issue was raised.
14. The Division Bench was of the view that even if the mode of calculation as applied
by the arbitrator is not very appropriate in its effect, that could not be a ground for
exercise of power under Section 34.
15. It noted that the reference in fact did not include the 13th to the 16th year to inspect
that the arbitrator thought it improper to open the same. The High Court was of the view
that a narrow technical reading of the Award cannot be made.
16. In support of the appeal, learned counsel for the appellant submitted that both learned
Single Judge and the Division Bench failed to notice that the Award made by the
Arbitrator was beyond the reference made. The arbitrators view that the corresponding
year could be a more appropriate factor is without foundation. The Bench mark of SCI in
a particular year could not be departed from. There was no scope for shifting of figures.
There is no rule of universal application that the cost of maintenance would be more
when the vehicle becomes older. The normative figure for third period remained constant.
The order of operation is the operating order and the financial order is defining. Though
in the Writ Petition there was challenge to 13 to 16 years, a bare reading of the writ
petition shows that it did not relate to the said period.
17. In response, learned counsel for the respondent submitted that two views are possible
and, therefore, High Court's view should not have interfered. Arbitrator had accepted one
view which is possible. No one says that it is dehors the Committees report. It is a case
where no interference is called for under Article 136 of the Constitution of India, 1950 (in
short the Constitution) as substantive justice had been done, even though the order may
be wrong on some parts.
18. Some of relevant parts of the Report of HLWG need to be noted:
" This High Level Working Group therefore, concludes that Rand M expenses are to be
actualized with effect from the 11th year of operation."
It was further noted as follows:
"This Committee was seized of the anomaly of lower rates being paid to those owners
who exercised greater management effectiveness by ensuring lower capital costs,
@page-SC459
lower interest rates and lower debt equity ratios."
19. The High Level Working Group, therefore, felt that though it is now not possible to
correct any anomalies that may have crept in during the first twelve years, at least for the
last term of four years the formula should reflect, as far as practicable, the principle of
equal pay for equal work.
20. It is to be noted that the anomalies referred to in the subsequent paragraphs relate to
the anomaly of lower rates being paid to owners to exercise greater management
effectiveness by ensuring lower capital because of lower interest rate and lower rate
equality ratio.
21. The recommendations of the HLWG are as follows:

1. Determination of year from which R and M expenses are to be actualized a.1st to


5th year as per payments already made. Settled cases not to be reopened.
b. 6th to 10th year as per norms fixed by the Dr. Saxena Committee of 1995-97.
c.11th and 12th years to be actualised on the basis of SCIs OSVs as recommended by the
Dr. Saxena Committee of 1995-97.
5. Ceiling rates for A type Vessels only pertaining to the period beyond 12 years of
operation a. From 1st to 5th year ceiling rates as already paid by ONGC.
b. From 6th to 10th year floor rates to be paid by ONGC.
c. For the 11th and 12th years ceiling rates to be paid by ONGC
6. Compensation in lieu of CRF a. The Operating Expenses (including Crew Salary
and Wages covering agreements between INSA and MUI/ NUSI) as determined on the
last day of the 12th year of operation for each vessel, (as per recommendations of the Dr.
Saxena Committee and further modified by this Working Group) to be fixed and made
applicable for the next four year i.e. from the 13th to the 16th year.

22.Operating costs are to be calculated on the basis of actual expenditure incurred by SCI
in operating SCIs OSVs for full (first) one year period.
23. The committee observed that the actual expenses of SCI have not followed any
uniform pattern. The scale to be suggested by the committee needed to be based on some
normative amount for a base year over which an escalation of 9.5% per annum may be
considered for a block of five years and for subsequent block of five years the base may
be changed in the same pattern as that of victualling cost. The committee observed
@page-SC460
that the total cost of repair and maintenance for the block of five years, that is, 1988-89 to
1992-93 of SCI's OSVs is Rs.106.482 lacs per OSV as against the recommended amount
of Rs.97.618 lacs given in the JS and FA committee report. The committee considered
that the SCIs audited statement of Rand M expenses may be considered as appropriate
amount for reimbursement to shipowners. The difference between SCIs audited Rand M
expenses and the normative amount was to be reimbursed to the shipowners on receipt of
SCIs audit statement from time to time in proportion to the BHP of the respective OSVs.
24. As the concept of reimbursement is the measure fixed, the year of operation can vary
is an irrelevant factor. The repair and maintenance expenses have also been dealt by the
Committee.
25. In accordance with the deliberation of the Committee on this at para 3.5.5, the
committee recommended the normative Rand M expenses of OSV of 5400 BHP for the
year 1988-89 to 1993-94 to be same as given in the JSand FA Committee report. The
Rand M expenses for the subsequent years were recommended at the rate of 9.5%
escalation per annum on the expense of the year 1993-94 upto 1998-99 and the amount
for of subsequent years @ 9.5% escalation per annum. The difference between the
recommended normative amount given and the actual Rand M expense of SCI's OSVs
of 5400 BHP (audited statements) were to be reimbursed on year to year basis after
receipt of the audited statement from SCI additional reimbursement of corresponding
overhead expenses in the ratio of 15:85 of the differential amount will also be made. The
differential amounts for other OSVs were recommended to be calculated pro rata basis of
the BHP of the respective OSVs w.r.t. above differential amount for OSVs of 5400 BHP.
26. Though there was some controversy as to whether the year referred to is the financial
year as reimbursement was on year to year basis after receipt of the auditors statement
from SCI the norms obviously relate to financial year.
27. A few factual aspects need to be noted. So far as Essar is concerned, the year is same
as SCI. In case of Bann, there was one time settlement and it is only JESCO which
challenged the report. SCIs first year of operation was 1984-85. The figures for that year
provide some material for rationalization. It is to be noted that stress is on re-
imbursement. Thus the measure is fixed and, therefore, year of operation is immaterial. It
needs no reiteration that claim was for 11th and 12th years and the award also covered
from 13th to 16th year. It is also to be noted that the HLWG referred to certain anomalies.
But they related to the previous years. The Bench Mark is the figure of SCI of particular
year. So when entry to business was made is irrelevant.
28. There is no proposition that the Courts could be slow to interfere with the arbitrators
Award, even if the conclusions are perverse, and even when the very basis of the
Arbitrators award is wrong. In any case this is a case where interference is warranted and
we set aside the norms prescribed by the Arbitrator as upheld by the learned Single Judge
and the Division Bench.
29. The appeal is allowed to the aforesaid extent with no order as to costs.
Order accordingly.
AIR 2008 SUPREME COURT 460 "United India Insurance Co. Ltd. v. Serjerao"
(From : Bombay)*
Coram : 2 A. PASAYAT AND P. SATHASIVAM, JJ.
Civil Appeal No. 5201 with 5202 to 5205, 5207 and 5208 of 2007 (arising out of SLP (C)
No. 9417 with 9418 to 9423 of 2005), D/- 14 -11 -2007.
United India Insurance Co. Ltd. v. Serjerao and Ors.
(A) Motor Vehicles Act (59 of 1988), S.147 - MOTOR VEHICLES - INSURANCE -
Liability of insurer - Labourers travelling in tractor trollies - Insurance Company has no
liability. (Para 8)
(B) Motor Vehicles Act (59 of 1988), S.140, S.173 - MOTOR VEHICLES - APPEAL -
No fault liability - Order passed on basis of - Appealable u/S. 173. (Para 6)
Cases Referred : Chronological Paras
2007 AIR SCW 3734 : AIR 2007 SC 1971 (Rel. on, Pnt. A) 8
2007 AIR SCW 4590 : AIR 2007 SC 2582 (Foll., Pnt. B) 6, 8
Sudhir Kumar Gupta, for Appellant.
* W. P. No. 4187 of 2003, D/- 20-4-2004 (Bom) (Aurangabad Bench)
Judgement
Dr. ARIJIT PASAYAT, J. :- Leave granted.
@page-SC461
2. Challenge in these appeals is to the order passed by a learned Single Judge of the
Bombay High Court, Aurangabad Bench dismissing the writ petitions filed by the
appellant (described hereinafter as 'the Insurance Company'). The controversy lies within
a very narrow compass.
3. The respondents were travelling in the trolly attached to a tractor as labourers. They
claimed to have suffered injuries because the tractor with the trolly in each case met with
an accident. Petitions claiming compensation under the Motor Vehicles Act, 1988 (in
short 'the Act') were filed along with application under Section 140 of the Act. Order was
passed by the learned Additional District Judge and Ex-officio Member, Motor Accident
Claims Tribunal, Latur (in short 'the MACT') on the principle of no fault liability. The
Insurance Company took the stand that it had no liability in respect of the persons
travelling in the Trolly and the owner of the Tractor is liable to pay compensation. This
plea was rejected by the MACT. Appeal in terms of Section 173 of the Act in each case
was preferred before the High Court. Learned Single Judge, prima facie, was of the view
that the appeal was not maintainable. Nevertheless, he referred the matter to the Division
Bench, which, it appears referred it to a Full Bench. While the matter was pending
consideration by the Full Bench, execution proceedings were filed. Therefore, writ
petitions were filed before the High Court. The High Court, by the impugned order in
each case, dismissed the writ petitions holding that though arguable questions were
involved, the writ petitions did not deserve consideration.
4. In support of the appeals, learned counsel for the appellant-Insurance Company
submitted that the appeals in terms of Section 173 of the Act were maintainable and in
any event, the Insurance Company has no liability in respect of the persons travelling in
trollies attached to the tractors.
5. There is no appearance on behalf of the respondents when the matter was called.
6

. So far as the question of maintainability aspect is concerned, the issue is concluded by a


judgment of this Court in Smt. Yallwwa and Ors. v. National Insurance Co. Ltd. and Anr.
(2007 (8) SCALE 77). 2007 AIR SCW 4590

7. In paragraphs 16 to 19 of the judgment, it was observed as follows:


"16. The question which is required to be considered is what would be the meaning of the
term 'award' when such a contention is raised. Although in a given situation having regard
to the liability of the owner of the vehicle, a Claim Tribunal need not go into the question
as to whether the owner of the vehicle in question was at fault or not, but determination
of the liability of the Insurance Company, in our opinion, stands on a different footing.
When a statutory liability has been imposed upon the owner, in our opinion, the same
cannot extend the liability of an insurer to indemnify the owner, although in terms of the
insurance policy or under the Act, it would not be liable therefor.
17. In a given case, the statutory liability of an Insurance Company, therefore, either may
be nil or a sum lower than the amount specified under Section 140 of the Act. Thus, when
a separate application is filed in terms of Section 140 of the Act, in terms of Section 168
thereof, an insurer has to be given a notice in which event, it goes without saying, it
would be open to the Insurance Company to plead and prove that it is not liable at all.
18. Furthermore, it is not in dispute that there can be more than one award particularly
when a sum paid may have to be adjusted from the final award. Keeping in view the
provisions of Section 168 of the Act, there cannot be any doubt whatsoever that an award
for enforcing the right under Section 140 of the Act is also required to be passed under
Section 168 only after the parties concerned have filed their pleadings and have been
given a reasonable opportunity of being heard. A Claims Tribunal, thus, must be satisfied
that the conditions precedent specified in Section 140 of the Act have been substantiated,
which is the basis for making an award.
19. Furthermore, evidently, the amount directed to be paid even in terms of Chapter-X of
the Act must as of necessity, in the event of non-compliance of directions has to be
recovered in terms of Section 174 of the Act. There is no other provision in the Act
which takes care of such a situation. We, therefore, are of the opinion that even when
objections are raised by the Insurance Company in regard to its liability, the Tribunal is
required to render a decision upon the issue, which would attain finality and,
@page-SC462
thus, the same would be an award within the meaning of Section 173 of the Act."
8

. So far as the question of liability regarding labourers travelling in trollies is concerned,


the matter was considered by this Court in Oriental Insurance Company Ltd. v. Brij
Mohan and Ors. (2007 (7) SCALE 753) and it was held that the Insurance Company has
no liability. In view of the aforesaid two decisions of this Court, we set aside the
impugned order in each case and remit the matters to the High Court to consider the
matters afresh in the light of what has been stated by this Court in Smt. Yallwwas case
(supra) and Brij Mohans case (supra). 2007 AIR SCW 3734
2007 AIR SCW 4590

9. The appeals are accordingly disposed of with no order as to costs.


Order accordingly.
AIR 2008 SUPREME COURT 462 "Gali Venkataiah v. State of A. P."
(From : Andhra Pradesh)*
Coram : 2 Dr. A. PASAYAT AND P. SATHASIVAM, JJ.
Criminal Appeal No. 1533 of 2007 (arising out of SLP (Cri.) No. 5907 of 2006), D/- 12
-11 -2007.
Gali Venkataiah v. State of A.P.
(A) Evidence Act (1 of 1872), S.3 - EVIDENCE - WITNESS - PLEA - FALSE
IMPLICATION - Interested witness - Relationship - Does not affect credibility - If plea
of false implication is made foundation therefor has to be laid.
AIR 1953 SC 364, Rel. on. (Para 7)
(B) Penal Code (45 of 1860), S.300, Exception 4 - MURDER - CULPABLE HOMICIDE
- Murder - Sudden fight - Accused and deceased brothers - Relationship between them
strained - Incident starting with exchange of hot words, then quarrel between the two and
culminating in accused inflicting knife blow on chest of deceased - Accused entitled to
benefit of Exception 4 to S. 300 - Conviction liable to be altered to one under S. 304, Part
I. (Paras 14, 16, 18)
(C) Penal Code (45 of 1860), S.300, Exception 4 - MURDER - Sudden fight - Benefit of
Exception 4 to S. 300 when available - Scope of explanation unfolded. (Para 11)
Cases Referred : Chronological Paras
(2007) 1 SCC 699 (Ref.) (Pt. A) 13
2006 AIR SCW 1678 : 2006 Cri LJ 2111 : 2006 (3) AIR Bom R 321 : 2006 (2) AIR Jhar
R 666 (Ref.) (Pt. B) 17
2004 AIR SCW 7376 : AIR 2005 SC 1460 (Ref.) (Pt. A) 13
2002 AIR SCW 4271 : AIR 2002 SC 3633 : 2003 Cri LJ 41 12
(2002) 3 SCC 76 12
AIR 1974 SC 276 : 1974 Cri LJ 331 (Ref.) (Pt. A) 9
AIR 1973 SC 2407 : 1973 Cri LJ 1589 12
AIR 1965 SC 202 : 1965 (1) Cri LJ 226 (Ref.) (Pt. A) 11
AIR 1957 SC 614 : 1957 Cri LJ 1000 (Ref.) (Pt. A) 9
AIR 1953 SC 364 : 1953 Cri LJ 1465 (Rel. on) 8, 10
AIR 1952 SC 54 : 1952 Cri LJ 547 10
Sidharth Luthra, Sr. Advocate, Sameer Parekh, Lalit Chauhan, Ms. Ranjeet Rohtagi and
Ms. Diksha Rai (for M/s. Parekh and Co. ), for Appellant; Mrs. D. Bharathi Reddy, for
Respondent.
* Cri. Appeal No. 1105 of 2003, D/- 31-10-2005 (AP)
Judgement
1. Dr. ARIJIT PASAYAT, J. :- Leave granted.
2. Challenge in this appeal is to the order passed by a Division Bench of the Andhra
Pradesh High Court upholding the conviction of appellant for offence punishable under
Section 302 of the Indian Penal Code, 1860 (in short the 'IPC') and sentence of
imprisonment for life and fine of Rs.1,000/- with default stipulation in terms of the
judgment of learned 4th Additional Sessions Judge, Nellore.
3. Background facts in a nutshell are as follows:
One Gali Krishnaiah (hereinafter referred to as the 'deceased') Gali Seethaiah and the
appellant are brothers and the relation between them was strained. Prior to the incident,
the appellant threatened the deceased that he would kill him. While so, on 13.09.1999, at
about 8.30 a.m. the appellant with an intent to kill the deceased, armed with a knife, went
to him, pulled him and stabbed on his left side of the chest and caused vital stab injury,
besides causing another cut injury over middle of the left forearm. The knife pierced into
the chest of the deceased and struck. When the sons of the deceased raised hue and cry,
the
@page-SC463
appellant left the spot leaving the knife there itself. On the way to the hospital, the
deceased succumbed to the injuries sustained by him. Based on the complaint presented
by the wife of the deceased (PW1), a case in Crime No. 161 of 1999 on the file of the II
Town (L and O) P.S., Nellore was registered and the same was investigated into. After
completion of investigation, charge-sheet was filed. Accused denied the charges and
claimed false implication. During trial, twelve witnesses were examined to further
prosecution version. Placing reliance on the evidence of eye-witnesses PWs 1 to 3,
conviction as noted above, was recorded and sentence imposed.
4. Challenging correctness of the judgment rendered by the trial court an appeal was
preferred before the High Court. The primary stand was that the witnesses PWs 1 to 3
were the wife and the sons of the deceased and were, therefore, interested witnesses.
Further the other witnesses who were independent did not support the prosecution
version. In any event it was submitted that an offence under Section 302, IPC is not
made out.
5. The prosecution supported the judgment of the trial court. The High Court noticed that
the evidence of P.Ws. 1 to 3 is clear, cogent and credible and therefore the conviction
cannot be faulted. It was also noticed that the evidence of PW6 was to the effect that he
found the appellant and the deceased struggling with each other and therefore it was of
the view that the conviction as recorded by the trial court did not suffer from any
infirmity.
6. In support of the appeal learned counsel for the appellant submitted that the evidence
of P.Ws. 1 to 3 should not have been relied upon as they were related to the deceased.
Further the evidence of P.Ws. 4 and 6 who did not support the prosecution version in its
entirety should not have been acted upon. In any event, it was contented that the assault
was made in course of sudden quarrel.
7. We shall first deal with the contention regarding interestedness of the witnesses for
furthering prosecution version. Relationship is not a factor to affect credibility of a
witness. It is more often than not that a relation would not conceal actual culprit and
make allegations against an innocent person. Foundation has to be laid if plea of false
implication is made. In such cases, the court has to adopt a careful approach and analyse
evidence to find out whether it is cogent and credible.
8

. In Dalip Singh and Ors. v. The State of Punjab (AIR 1953 SC 364) it has been laid
down as under: (Para 26)

"A witness is normally to be considered independent unless he or she springs from


sources which are likely to be tainted and that usually means unless the witness has
cause, such as enmity against the accused, to wish to implicate him falsely. Ordinarily a
close relation would be the last to screen the real culprit and falsely implicate an innocent
person. It is true, when feelings run high and there is personal cause for enmity, that
there is a tendency to drag in an innocent person against whom a witness has a grudge
along with the guilty, but foundation must be laid for such a criticism and the mere fact of
relationship far from being a foundation is often a sure guarantee of truth. However, we
are not attempting any sweeping generalization. Each case must be judged on its own
facts. Our observations are only made to combat what is so often put forward in cases
before us as a general rule of prudence. There is no such general rule. Each case must be
limited to and be governed by its own facts."
9

. The above decision has since been followed in Guli Chand and Ors. v. State of
Rajasthan (1974 (3) SCC 698) in which Vadivelu Thevar v. State of Madras (AIR 1957
SC 614) was also relied upon. AIR 1974 SC 276

10

. We may also observe that the ground that the witness being a close relative and
consequently being a partisan witness, should not be relied upon, has no substance. This
theory was repelled by this Court as early as in Dalip Singh's case (supra) in which
surprise was expressed over the impression which prevailed in the minds of the Members
of the Bar that relatives were not independent witnesses. Speaking through Vivian Bose,
J. it was observed: AIR 1953 SC 364, (Para 25)

"We are unable to agree with the learned Judges of the High Court that the testimony of
the two eye-witnesses requires corroboration. If the foundation for such an observation is
based on the fact that the witnesses are women and that the fate of seven men hangs on
their testimony, we know of no
@page-SC464
such rule. If it is grounded on the reason that they are closely related to the deceased we
are unable to concur. This is a fallacy common to many criminal cases and one which
another Bench of this Court endeavoured to dispel in 'Rameshwar v. State of Rajasthan'
(AIR 1952 SC 54 at p. 59). We find, however, that it unfortunately still persists, if not in
the judgments of the Courts, at any rate in the arguments of counsel."
11. Again in Masalti and Ors. v. State of U.P. (AIR 1965 SC 202) this Court observed
(pp. 209-210 para 14):
"But it would, we think, be unreasonable to contend that evidence given by witnesses
should be discarded only on the ground that it is evidence of partisan or interested
witnesses.......The mechanical rejection of such evidence on the sole ground that it is
partisan would invariably lead to failure of justice. No hard and fast rule can be laid
down as to how much evidence should be appreciated. Judicial approach has to be
cautious in dealing with such evidence; but the plea that such evidence should be rejected
because it is partisan cannot be accepted as correct."
12

. To the same effect is the decision in State of Punjab v. Jagir Singh (AIR 1973 SC 2407),
Lehna v. State of Haryana (2002 (3) SCC 76) and Gangadhar Behera and Ors. v. State of
Orissa (2002 (8) SCC 381). 2002 AIR SCW 4271

13

. The above position was highlighted in Babulal Bhagwan Khandare and Anr. v. State of
Maharashtra [2005(10) SCC 404] and in Salim Saheb v. State of M.P. (2007(1) SCC
699). 2004 AIR SCW 7376

14. It appears from the evidence of the witnesses that the relationship between the
appellant and the deceased was strained and much before the assault was made, there was
exchange of hot words between the accused and the deceased and they were quarrelling
with each other.
15. For bringing in operation of Exception 4 to Section 300, IPC, it has to be established
that the act was committed without premeditation, in a sudden fight in the heat of passion
upon a sudden quarrel without the offender having taken undue advantage and not having
acted in a cruel or unusual manner.
16. The Fourth Exception to Section 300, IPC covers acts done in a sudden fight. The
said Exception deals with a case of prosecution not covered by the First Exception, after
which its place would have been more appropriate. The Exception is founded upon the
same principle, for, in both there is absence of premeditation. But, while in the case of
Exception 1 there is total deprivation of self-control, in case of Exception 4, there is only
that heat of passion which clouds men's sober reasons and urges them to deeds which
they would not otherwise do. There is provocation in Exception 4 as in Exception 1; but
the injury done is not the direct consequence of that provocation. In fact Exception 4
deals with cases in which notwithstanding that a blow may have been struck, or some
provocation given in the origin of the dispute or in whatever way the quarrel may have
originated, yet the subsequent conduct of both parties puts them in respect of guilt upon
equal footing. A "sudden fight" implies mutual provocation and blows on each side. The
homicide committed is then clearly not traceable to unilateral provocation, nor in such
cases could the whole blame be placed on one side. For, if it were so, the Exception more
appropriately applicable would be Exception 1. There is no previous deliberation or
determination to fight. A fight suddenly takes place, for which both parties are more or
less to be blamed. It may be that one of them starts it, but if the other had not aggravated
it by his own conduct it would not have taken the serious turn it did. There is then mutual
provocation and aggravation, and it is difficult to apportion the share of blame which
attaches to each fighter. The help of Exception 4 can be invoked if death is caused. (a)
without premeditation; (b) in a sudden fight; (c) without the offender having taken undue
advantage or acted in a cruel or unusual manner; and (d) the fight must have been with
the person killed. To bring a case within Exception 4 all the ingredients mentioned in it
must be found. It is to be noted that the "fight" occurring in Exception 4 to Section 300,
IPC is not defined in IPC. It takes two to make a fight. Heat of passion requires that there
must be no time for the passions to cool down and in this case, the parties have worked
themselves into a fury on account of the verbal altercation in the beginning. A fight is a
combat between two or more persons whether with or without weapons. It is not possible
to enunciate any general rule as to what shall be deemed to be a sudden quarrel. It is a
question of fact
@page-SC465
and whether a quarrel is sudden or not must necessarily depend upon the proved facts of
each case. For the application of Exception 4, it is not sufficient to show that there was a
sudden quarrel and there was no premeditation. It must further be shown that the offender
has not taken undue advantage or acted in cruel or unusual manner. The expression
"undue advantage" as used in the provision means "unfair advantage".
17

. The above position is highlighted in Sandhya Jadhav v. State of Maharashtra, (2006) 4


SCC 653. 2006 AIR SCW 1678

18. Considering the factual background we are of the view that the appropriate conviction
would be in terms of Section 304, Part I, IPC, custodial sentence of ten years would meet
the ends of justice. The appeal is allowed to the aforesaid extent.
Order accordingly.
AIR 2008 SUPREME COURT 465 "Larsen and Toubro Ltd. v. Fertilizer and Chemicals
Travancore Ltd."
(From : Kerala)*
Coram : 2 Dr. A. PASAYAT AND LOKESHWAR SINGH PANTA, JJ.
Civil Appeal No. 5159 with 5160 of 2007 (arising out of SLP (C) Nos. 4014 with 4015 of
2006), D/- 12 -11 -2007.
Larsen and Toubro Ltd. v. Fertilizer and Chemicals Travancore Ltd.
Arbitration and Conciliation Act (26 of 1996), S.11 - ARBITRATION AND
CONCILIATION - APPOINTMENT - AMENDMENT - Appointment of Arbitrator -
Dispute as to withholding of certain amount in breach of conditions of purchase order -
Purchase order contained Special Conditions, Standard Terms and Conditions - Articles
25 and 26 of Standard Conditions contained provision for appointment of named
Arbitrator - Amendments incorporated to Articles 25 and 26 by Special Conditions only
provided that provisions of relevant Arbitration Act will be applicable - And that venue of
arbitration shall be Cochin - It cannot be said Special Conditions superseded Standard
Conditions - Apprehension that named Arbitrator may not act fairly is without any
foundation.
AIR 1988 SC 1099, Relied on. (Paras 8, 11, 12)
Cases Referred : Chronological Paras
AIR 1988 SC 1099 (Rel. on.) 10
AIR 1988 SC 2232 (Rel. on) 9
V. A. Mohta, Sr. Advocate, Nilkanta Nayak, Ms. Shweta Bharti, Ms. Aditi Mohan, Ms.
Neelam and Ms. Niranjana Singh, for Appellant; C. N. Sree Kumar, for the Respondent.
* A. R. No. 29 of 1999, D/- 18-12-1999 (Ker)
Judgement
Dr. ARIJIT PASAYAT, J. :-Leave granted.
2. Challenge in these appeals is to the order passed by the learned Single Judge of the
Kerala High Court disposing of arbitration request filed before him.
3. Background facts in a nutshell are as follows:-
Appellant and the respondent entered into a contract vide purchase order No. 3020/02-
2701/016/1018, dated 7.1.1995. Alleging that in breach of the terms and conditions of the
purchase order certain amounts were withheld, the appellant invoked the arbitration
agreement purportedly in terms of new Article 26 of the Special Conditions and
suggested three names for appointment of an independent sole arbitrator and called upon
the respondent to name one out of the three names. The respondent took the stand that it
is only the Managing Director of the respondent who can be appointed as a named
arbitrator as per Article 26 of the Standard Conditions and refused to appoint a sole
independent arbitrator. The High Court of Kerala was moved seeking appointment of an
arbitrator by Arbitration Request 29/99. Learned Single Judge declined the arbitration
request on the ground that terms and conditions of the purchase order provides for
arbitration by the Chairman and Managing Director of the respondent. A writ petition was
filed under Article 226 of the Constitution of India, 1950 (in short the 'Constitution').
During pendency of the said writ petition this Court in CA Nos. 3777, 4168 and 4169 of
2003 held that the order passed under Section 11 of the Arbitration and Conciliation Act,
1996 (in short the 'Act') is a judicial order and writ petition challenging the said order
under Article 226 of the Constitution is not maintainable. Therefore, this appeal has been
filed.
4. In support of the appeals, learned counsel for the appellant submitted that the provision
contained in Article 26 of the Standard Conditions is not the actual provision for
arbitration. The same is contained in the Special Terms and Conditions attached to the
purchase order and the work order
@page-SC466
respectively. The purchase order and the work order contained Special Conditions,
Standard Terms and Conditions. By Article 16 of the Special Terms and Conditions of
the purchase, there is amendment to Article 25 of the Standard Conditions. There is
similar amendment to Article 26 of the standard terms so far as it related to
commissioning. The provisions contained in the Standard Conditions in both the cases, it
was submitted by learned counsel for the appellant, is not actual provision for
arbitration.The general condition stated that all disputes and differences are required to be
referred to the Chairman and Managing Director of the respondent-company for his
decision and it will be binding on the parties. It was further contended that the provisions
contained in the Special Conditions by themselves do not have any provision for
arbitration. It does not have any clause that disputes and differences shall be settled by
arbitration. In both the cases, the Special Conditions specifically state that it is by way of
amendment of general condition only and not in supersession of that provision. The
Chairman and the Managing Director of the respondent-company cannot be treated as
independent person to be appointed as arbitrator. This was essentially the stand which
did not find acceptance. It is submitted by learned counsel for the appellant that certain
changes were suggested by the respondent.
5. Learned counsel for the respondent on the other hand submitted that the High Court
view is unexceptionable.
6. At this juncture it would be necessary to take note of the few conditions :
Clause 16 of the Work Order reads as follows:-
"16. Work Order Conditions:
The order shall be governed by the above conditions as well as by the conditions
stipulated in Attachment I, II and III of this Work Order, except the following:
The order shall be governed by the present Special Conditions of work (W.O. Attachment
III) as well as by the conditions stipulated in Attachment I, and II of this Work Order,
except the following:
Spec. No.3020/CS/04: Standard Terms and Conditions of Erection and Commissioning.
Art. 4.0.0 Taxes, Duties and Levies (Comment)
Taxes shall be as per Article 4.0.0. However, at present conditions; tax on this Work
Order is not applicable.
Art. 13.0.0 Termination (Comment)
FACT can terminate the Work Order without giving any reason provided that reasonable
cost for termination and actual out-of-pocket expenses will be reimbursed.
Art. 15.0.0 Changes (Amendment)
FACT shall issue amendment orders which provide for changes in the scope of work
required by FACT under the Work Order, and for equitable adjustment in the price and
delivery/completion time, if any, hereunder.
Art. 21.0.0 Tests on Completion and Taking Over (New Article Added).
Art. 21.5.0 (New Article)
The Primary Reformer Package under the scope of this Work Order shall be deemed to be
taken over by FACT immediately after satisfactory pre-commissioning is over within 10
days of Contractor's notice to Owner for commencement of commissioning after pre-
commissioning, whichever is earlier. In case taking over is delayed due to no fault of
Contractor, after the notice given by Contractor in this regard about the Completion, the
entire Primary Reformer Package is deemed to be taken over by FACT.
Art. 24.0.0 Indemnification
Secondary liability such as indemnification for loss caused by stoppage of plant of like
will be excluded from Contractor's liabilities under the Work Order.
Art. 26.0.0 Applicable Law and Settlement of Disputes (Amendment)
The provisions of the Indian Arbitration Act, 1940 and the rules thereunder, any statutory,
modifications there for the time being in force will be applied.
The venue for the arbitration shall be Cochin, and the language of the proceedings shall
be the English language.
During the arbitration proceedings, both parties shall continue to discharge their
obligations under the Work Order."
7. There was addition and not substitution of condition. Without amendment there was
arbitration clause and if there was no amendment the only substitution, then that there
was no arbitration clause. In the arbitration request in the statement of facts it
@page-SC467
has been clearly stated that Article 26 of the Standard Terms and Conditions of purchase
form part of the Work Order. The same read as follows:
"Article 26: Work Order shall be subject to and shall in all respects be governed by Indian
law. Any dispute or difference connected with or arising out of WORK ORDER which
cannot be settled by mutual agreement of the parties shall be referred to the Chairman
and Managing Director of FACT, and his decision will be binding on the parties. Any
legal proceeding relating to this WORK ORDER shall be limited to Courts of law under
the jurisdiction of the Kerala High Court at Ernakulam District, Kerala State, India."
8. The stand of the learned counsel for the appellant that the Special Conditions of the
work order superseded the Standard Terms and Conditions, is not correct. The mere fact
that the arbitrator was named does not render the arbitration proceedings invalid.
9

. In Secretary to Government, Transport Deptt., Madras v. Munuswamy Mudliar and Anr.


(1988 Suppl SCC 651) it was noted as follow: AIR 1988 SC 2232

"7. Pursuant to this the Superintending Engineer of that Circle, at the relevant time, was
previously appointed as arbitrator. There was succession to that office by another
incumbent and the succeeding Superintending Engineer wanted to continue the
arbitration proceedings but before that an application was made under Section 5 of the
Arbitration Act, 1940 (hereinafter called 'the Act') for removal of the arbitrator, before the
learned Judge of the City Civil Court, Madras."
10. Again in paras 11 to 13 it was noted as follows:
"11. This is a case of removal of a named arbitrator under Section 5 of the Act which
gives jurisdiction to the court to revoke the authority of the arbitrator. When the parties
entered into the contract, the parties knew the terms of the contract including arbitration
clause. The parties knew the scheme and the fact that the Chief Engineer is superior and
the Superintending Engineer is subordinate to the Chief Engineer of the particular Circle.
In spite of that the parties agreed and entered into arbitration and indeed submitted to the
jurisdiction of the Superintending Engineer at that time to begin with, who, however,
could not complete the arbitration because he was transferred and succeeded by a
successor. In those circumstances on the facts stated no bias can reasonably be
apprehended and made a ground for removal of a named arbitrator. In our opinion this
cannot be, at all, a good or valid legal ground. Unless there is allegation against the
named arbitrator either against his honesty or capacity or mala fide or interest in the
subject-matter or reasonable apprehension of the bias, a named and agreed arbitrator
cannot and shou1d not be removed in exercise of a discretion vested in the Court under
Section 5 of the Act.
12. Reasonable apprehension of bias in the mind of a reasonable man can be a ground for
removal of the arbitrator. A predisposition to decide for or against one party, without
proper regard to the true merits of the dispute is bias. There must be reasonable
apprehension of that predisposition. The reasonable apprehension must be based on
cogent materials. See the observations of Mustill and Boyd, Commercial Arbitration,
1982 edn., page 214. Halsbury's Laws of England, 4th edn., Volume 2, para 551, page
282 describe that the test for bias is whether a reasonable intelligent man, fully apprised
of all the circumstances, would feel a serious apprehension of bias.

13. This Court in International Airports Authority of India v. K. D. Bali (1988 (2) SCC
360) held that there must be reasonable evidence to satisfy that there was a real likelihood
of bias. Vague suspicions of whimsical, capricious and unreasonable people should not be
made the standard to regulate normal human conduct. In this country in numerous
contracts with the Government, clauses requiring the Superintending Engineer or some
official of the Government to be the arbitrator are there. It cannot be said that the
Superintending Engineer, as such cannot be entrusted with the work of arbitration and
that an apprehension, simpliciter in the mind of the contractor without any tangible
ground, would be a justification for removal. No other ground for the alleged
apprehension was indicated in the pleadings before the learned Judge or the decision of
the learned Judge. There was, in our opinion, no ground for removal of the arbitrator.
Mere imagination of a ground cannot be an excuse for apprehending bias AIR 1988 SC
1099

@page-SC468
in the mind of the chosen arbitrator."
11. The apprehension that named arbitrator may not act fairly is without any foundation.
The High Court has rightly held that by Article 16 of the Special Terms and Conditions of
purchase there was an amendment to Article 25 which reads as follows:-
"The provisions of the Indian Arbitration Act, 1940, and the rules thereunder, any
statutory modifications thereof of the time being in force will be applied. The venue of
the arbitration shall be Cochin, and the language of the proceedings shall be the English
Language. During the arbitration proceedings, both parties shall continue to discharge
their obligations under the Purchase Order."
12. Similar was the amendment to Article 26 of the Standard Terms and Conditions for
erection and commissioning in Article 16 of the Special Conditions of work attached to
the Work Order. The Special Conditions themselves show that Articles 25 and 26
contained provisions for arbitration. The amendments incorporated by the Special
Conditions only provide that the provisions of the relevant Arbitration Act and the Rules
made thereunder and any statutory modifications thereof for the time being in force will
be applicable and the venue of arbitration and language of the proceedings.
13. The appeals are sans merit, deserve dismissal, which we direct.
Appeals dismissed.
AIR 2008 SUPREME COURT 468 "Jaswant Talkies, M/s. v. Commercial Taxes Officer,
Bhilwara"
(From : Rajasthan)*
Coram : 2 Dr. A. PASAYAT AND D. K. JAIN, JJ.
Civil Appeal No. 5161 of 2007 (arising out of SLP (C) No. 7053 of 2006), D/- 12 -11
-2007.
M/s. Jaswant Talkies v. Commercial Taxes Officer, Bhilwara.
Rajasthan Sales Tax Act (22 of 1995), S.65 - Rajasthan Entertainment and Advertisement
Tax Act (24 of 1957), S.10 (as amended in 1998) - SALES TAX - ENTERTAINMENT
TAX - AMENDMENT - Penalty - Levy of - Ticketless viewers found in Cinema Hall of
assessee much before amendment - Quantum of penalty provided in S. 10 is Rs. 500/- per
contravention - To make provision stringent, shift was made by Amendment Act to per
viewer - Amendment is neither clarificatory nor retrospective - Levy of penalty @ of Rs.
500 per viewer not proper.
S. B. Civil (Sales Tax) Revn. No. 173 of 2000, D/- 3-2-2006 (Raj), Reversed. (Paras
9, 10)
Cases Referred : Chronological Paras
2004 (1) STT 237 (Raj) 4
2003 (1) WLC (Raj) 306 4
Dr. Manish Singhvi, P. V. Yogeswaran, for Appellant; Aruneshwar Gupta, AAG, Naveen
Kumar Singh, Mukul Sood and Shashwat Gupta, for Respondent.
* S. B. Civil (Sales Tax) Revn. No. 173 of 2000, D/- 3-3-2006 (Raj), (at Jodhpur)
Judgement
1. Dr. ARIJIT PASAYAT, J. :-Leave granted.
2. Challenge in this appeal is to the order passed by a learned Single Judge of the
Rajasthan High Court at Jodhpur, allowing the revision filed by the respondent. The said
revision petition was filed under Section 86 of the Rajasthan Sales Tax Act, 1994 (in
short the 'Act').
3. Factual position which is almost undisputed is as follows:
The appellant is an exhibitor of cinematograph films. On 3.2.1996 cinema hall of the
appellant was inspected by the Commercial Tax Inspectors. At that time a movie
"Alladdin" was being shown in the morning show. At the time of inspection, 878 viewers
were found watching the movie without tickets. It was found that the daily collection
register maintained by the appellant was not properly maintained. The inspectors put their
signatures after drawing a line in the register so that no entry can be made thereafter.
Alleging that the appellant admitted 878 viewers without tickets, a show cause notice was
issued under Section 10 of the Rajasthan Entertainment and Advertisement Tax Act, 1957
(in short the 'Entertainment Act') prima facie being of the view that offence under
Sections 6(1) and 6(2) of the Entertainment Act has been committed. The appellant
submitted its reply and stated that girl students of a school had gone to watch the movie
which was meant for children and in any event there was no scope for imposition of
penalty of Rs.500/- in respect of each viewer. The Commercial Tax Officer, Bhilwara was
of the view that penalty at the rate of Rs. 500/- per viewer was to be imposed and in
addition penalty of Rs. 500/- under Section 10(3)(b) was also to be
@page-SC469
imposed. The officer was of the view that mere fact that children of Mahila Aashram
were being shown the picture and the tickets were to be handed over to the school
authorities after counting the number of children was not relevant.
The inspection was done at 10.00 a.m. when the school children had just entered the Hall
and, therefore, even before the show started the inspection was done. The order of
assessment was challenged before the Commissioner (Appeals). The said authority found
that all the tickets were with the Manager of the Cinema, but since each viewer did not
possess a ticket there was contravention. Therefore, penalty under Section 10(3)(a) of the
Entertainment Act was upheld while setting aside the penalty imposed under Section
10(3)(b)(iii).
The appellant preferred an appeal against the said order before the Rajasthan Taxation
Board, Ajmer (in short the 'Taxation Board'). Before the Taxation Board, it was contended
that the total cost of the tickets was Rs. 3006/- and penalty of Rs. 4,39,000/- at the rate of
Rs. 500/- per viewer was unconscionable. The Taxation Board found that the penalty that
was imposed was not imposable at the rate of Rs. 500/- per viewer and the maximum
penalty imposable was Rs. 500/-.
Revenue filed a revision petition as noted above and by the impugned order penalty
imposed by the Assessing Officer was restored.
4. In support of the appeal, learned counsel for the appellant submitted that the High
Court has relied on a decision of its own Court in Maharana Talkies, Bhilwara v. State of
Rajasthan and Ors. (2004 (1) STT 237 (Raj.HC)) ignoring the view expressed in State of
Rajasthan and Ors. v. RTT and Ors. (2003 WLC (Raj.)) which held that no penalty can be
levied per person. The High Court also, it is pointed out, held in that case that the
subsequent amendment was not clarificatory.
5. Learned counsel for the State on the other hand supported the order.
6. The legislative history of the statutory provision needs to be noted.
Section 10 of the Rajasthan Entertainment and Advertisement Act, 1957 existing pre-
1982
10. Offence and penalties.- (1) Notwithstanding anything contained in any law for the
time being in force, a ticket for admission to an entertainment shall not be resold for
profit by the holder thereof.
(2) Whoever re-sells any ticket for admission in contravention to the provisions of sub-
section (1) shall, on conviction before a Magistrate, be liable to pay fine which may
extend to two hundred rupees.
(3)(a) The proprietor of any entertainment or any person employed by him in any place of
entertainment, who admits any person to any place of entertainment in contravention of
the provisions of sub-section (1) or sub-section (2) of Section 6, or
(b) The proprietor of an entertainment who-
(i) fails to pay the tax due from him under this Act within the prescribed time, or
(ii) fraudulently evades the payment of tax due from him under this Act,
(iii) contravenes any of the provisions of this Act or the rules framed thereunder for
which no other penalty has been provided under this Act.
shall be liable to pay by way of penalty, in addition to the amount of tax payable by him a
sum not exceeding Rs. 500/-.
Section 10 of the Rajasthan Entertainment and Advertisement Act, 1957 from 1982
10. Offence and penalties.- (1) Notwithstanding anything contained in any law for the
time being in force, a ticket for admission to an entertainment shall not be resold for
profit by the holder thereof.
(2) Whoever re-sells any ticket for admission in contravention to the provisions of sub-
section (1) shall, on conviction before a Magistrate, be liable to pay fine which may
extend to two hundred rupees.
(3)(a) The proprietor of an entertainment or any person employed by him in any place of
entertainment, who admits any person to any place of entertainment in contravention of
the provisions of sub-section (1) or sub-section (2) of Section 6, or
(b) The proprietor of an entertainment who-
(i) fails to pay the tax due from him under this Act within the prescribed time, or
(ii) fraudulently evades the payment of tax due from him under this Act, or
(iii) contravenes any of the provisions of
@page-SC470
this Act or the rules framed thereunder for which no other penalty has been provided
under this Act,
shall be liable to pay by way of penalty-
(i) in respect of cases referred to in clause (a) and sub-clauses (i) and (iii) of clause (b) in
addition to the amount of tax payable by him, a sum not exceeding Rs. 500/- and
(ii) in respect of cases referred to in sub-clause (ii) of clause (b) in addition to the amount
of tax payable by him a sum not exceeding rupees five hundred or double the amount of
tax evaded whichever is higher.
(4) The prescribed authority not below the rank of an Assistant Commercial Taxes Officer
may, after affording a reasonable opportunity of being heard to the person affected,
impose the penalty mentioned in sub-section (3).
(5) The person affected may, within one month of the communication of the order
directing payment of any sum by way of penalty under sub-section (3) appeal to the
prescribed authority.
Amended Section 10 of the Rajasthan Entertainment and Advertisement Act, 1957 with
effect from 31.7.1998
10. Offence and penalties- (1) Notwithstanding anything contained in any law for the
time being in force a ticket for admission to an entertainment shall not be resold for profit
by the holder thereof.
(2) Whoever re-sells any ticket for admission in contravention to the provisions of sub-
section (1) shall, on conviction before a Magistrate, be liable to pay fine which may
extend to two hundred rupees.
(3)(a) The proprietor of an entertainment or any person employed by him in any place of
entertainment, who admits any person to any place of entertainment in contravention of
the provisions of sub-section (1) or sub-section (2) of Section 6, or
(b) the proprietor of an entertainment who-
(i) fails to pay the tax due from him under this Act within the prescribed time, or
(ii) fraudulently evades the payment of tax due from him under this Act, or
(iii) contravenes any of the provisions of this Act or the rules framed thereunder for
which no other penalty has been provided under this Act shall be liable to pay by way of
penalty-
(i) in respect of cases referred to in clause (a) and sub-clause (1) of clause (b) regarding
entertainment tax, in addition to the amount of tax payable by him, a sum not exceeding
Rs.100/- per person;
(ii) in respect of cases referred to in sub-clause (1) of clause (b) regarding advertisement
tax and in respect of cases referred to in sub-clause (iii) of clause (b) in addition to the
amount of tax payable by him, a sum not exceeding Rs.500; and
(iii)in respect of cases referred to in sub-clause (ii) of clause (b) in addition to the amount
of tax payable by him a sum not exceeding Rupees five hundred or double the amount of
tax evaded whichever is higher.
(4) The prescribed authority not below the rank of an Assistant Commercial Taxes Officer
may, after affording a reasonable opportunity of being heard to the person affected,
impose the penalty mentioned in sub-section (3).
7. It is to be noted that Section 10 of the Entertainment Act has been amended w.e.f. 31st
July, 1998. The amended provision permits imposition of penalty per person. Section
10(3)(b) contemplates two types of penalties. The first relates to cases covered by clause
(a) and sub-clauses (i) and (ii) of Clause (b). The second relates to sub-clause (ii) of
Clause (b) of sub-section 3 of Section 10. The case at hand relates to clause (a) of sub-
section (3) of Section 10. If the position was clear as contended by learned counsel for
the State that the penalty is to be at the rate of Rs. 500/- per person, there was no reason
for the amendment which specifically provided for imposition of penalty per person.
8. The Statement of Objects and Reasons for the amendment also throw considerable
light on this position. The same reads as follows:
B. Amendment in the Rajasthan Entertainment and Advertisements Tax Act, 1957
Certain amendments in the Rajasthan Entertainment and Advertisements Tax Act, 1957
have been considered necessary and were under consideration for quite some time past.
Owing to repeal of the Rajasthan Sales Tax Act, 1954 and coming into force of new Act
of 1994, definition of the term 'Sales Tax Act', and due to proposed induction of certain
new provisions in the 'Act of 1957', definitions of the terms 'appellate authority', 'Tax
Board' and 'Tribunal' are proposed to be inserted vide clause 9 of the Bill.
@page-SC471
To provide for limitation for assessments, new section 5BB, to ensure effective recovery
of the outstanding entertainment tax by providing special mode of recovery, substitution
of section 9, to enable payment of outstanding dues in installments, new section 5BB, to
enable the Commissioner to reduce or waive interest and penalty under the Act in case of
genuine hardship, new section 9C are proposed to be inserted, substituted or inserted, as
the case may be, vide clauses 12, 13 or 14 of the Bill respectively.
Moreover to make the penalty provision more practicable, section 10 (3) (b) is proposed
to be substituted vide clause 15 of the Bill.
Besides above, to provide for statutory remedy of first appeal, new section 13-A, to
provide for appeal against order of appellate authority, new section 13-B, to provide for
revision to tribunal, new section 13-C provide for powers of revision to Commissioner in
case of an order passed by the prescribed authority being erroneous or prejudicial to the
interest of State revenue, new section 13D, and to provide for rectification of mistakes
apparent from the record, new section 13-E; are proposed to be inserted vide clause 19 of
the Bill.
Some of the consequential or minor amendments are also proposed in various sections of
the Act of 1957 vide clauses 10, 11, 17, 20 and 21 of the Bill.
Extract of the Rajasthan Finance Bill, 1998, Relevant portion:
15. Amendment of Section l0, Rajasthan Act No. 24 of 1956:
In section 10 of the principal Act,-
(a) for existing clause (b) of sub-section (3), the following clause shall be substituted,
namely:
"(b) the proprietor of any entertainment who-
(i) fails to pay the tax due from him under this Act within the prescribed time, or
(ii) fraudulently evades the payment of tax due from him under this Act, or
(iii) contravenes any of the provisions of this Act or the rules framed thereunder, for
which no other penalty has been provided under this Act, shall be liable to pay by way of
penalty:
(i) in respect of cases referred to in clause (a) and sub-clause (i) of clause (b) regarding
entertainment tax, in addition to the amount of tax payable by him, a sum not exceeding
Rs.100/- per person.
(ii) in respect of cases referred to in sub-clause (i) of clause (b) regarding advertisement
tax and in respect of cases referred to in sub-clause (iii) of clause (b), in addition to the
amount of tax payable by him, a sum not exceeding Rs. 500; and
(iii) in respect of cases referred to in sub-clause (ii) of clause (b) in addition to the
amount of tax payable by him a sum not exceeding Rupees five hundred or double the
amount of tax evaded whichever is higher."
(b) sub-section (5) shall be deleted.
9. It is also irrational that as against a tax liability of Rs. 3006/-, penalty of Rs. 4,39,000/-
was to be imposed. Though in all cases quantum would not be a relevant factor, but on
analyzing the scheme of the Statute it is clear that the stress is on the contravention. The
contravention essentially is of admitting persons without valid ticket and at the relevant
point of time, had no nexus with the number of persons. To make the provision stringent
the shift has been made to per person. But the amendment has no retrospective effect and
as noted above is not clarificatory.
10. As noted above, the amendment does not appear to be clarificatory in nature as
contended by learned counsel for the respondent-State. The view of the High Court,
therefore, is not correct. The conclusion of the Taxation Board was the correct view.
11. The appeal deserves to be allowed which we direct. There shall be no order as to
costs.
Appeal allowed.
AIR 2008 SUPREME COURT 471 "Mohan Kumar Rayana v. Komal Mohan Rayana"
(From : Bombay)*
Coram : 2 C. K. THAKKER AND ALTAMAS KABIR, JJ.
Civil Appeal Nos. 5088-5097 of 2007 (arising out of SLP (C) Nos. 15167-15176 of
2007), D/- 1 -11 -2007.
Mohan Kumar Rayana v. Komal Mohan Rayana. @page-SC472
Hindu Minority and Guardianship Act (32 of 1956), S.6 read with S.7 - MINORITY
AND GUARDIANSHIP - HIGH COURT - APPEAL - Custody of minor daughter -
Visitation rights of farther - Directions given by High Court pending appeal - Not
observed strictly by both parties - Order granting access to father to meet minor kept in
abeyance by High Court pending appeal till receipt of report of Psychiatrist - Appeal
against by father - Court after meeting parties as well as minor in chamber forusing view
that father should not be denied complete access to child pending disposal of appeals by
High Court - Further directions as to visitation time passed - Since welfare of minor is
involved, directions also given to dispose of matter expeditiously. (Paras 15, 16, 17)
Dr. A. M. Singhvi, Sr. Advocate, Sudhanshu Batra, S. Jayaram, Pramit Saxena, Amit
Yadav, Dr. Kevic Setalwad and S. V. Deshpande, for Appellant; Ms. Indu Malhotra, Sr.
Advocate, R. I. Lalwani, Ms. S. I. Jayakar (Lalwani), Ms. Sunieta Ozha, Nitin Ramesh
and Ms. Anitha Shenoy, for Respondent.
* From the interim Judgments and Orders dated 12-7-2007, 19-7-2007, 27-7-2007, 6-8-
2007 of the High Court of Bombay in F. C. A. Nos. 61 and 29, C. A. No. 81 with 39 with
169 in F. C. A. No. 29 of 2007.
Judgement
1. ALTAMAS KABIR, J. :-Leave granted.
2. Since both the parties to the special leave petitions are before us, Notice of the Appeals
is waived on behalf of the respondent, Komal Mohan Rayana.
3. The appeals arise out of circumstances wherein owing to disputes and differences
between a married couple, the child born of the wedlock has become the object of a tussle
for custody between the two parents.
4. The subject-matter of these appeals are four orders passed by the Bombay High Court
on 12th July, 2007, 19th July, 2007, 27th July, 2007 and 6th August, 2007 in two appeals
from a Petition No.D-65/2005 before the Family Court. In order to appreciate the
circumstances in which these orders came to be passed, it will be necessary to state a few
facts leading to the commencement of the proceedings before the Family Court.
5. Admittedly, the appellant herein, who is the husband of the respondent, married the
respondent on 2nd March, 2002. A daughter was born to them and she was named
Anisha. Initially there were no disputes as such between the parties but after the
daughter's birth, the atmosphere in the marital home began to change. We shall not go
into the causes as alleged by the respondent since such allegations are not relevant for our
purpose, but we can only observe that one of the reasons given by the respondent for the
changed circumstances was the change in behaviour of the appellant towards her, on
account of addiction to alcohol in the company of his friends.
6. In any event, there appears to have been some marital discord, which resulted in the
respondent leaving the matrimonial house in July 2004 with her minor daughter and
seeking shelter with her parents at Bandra. According to the respondent, during the said
period she continued to send Anisha to the Kinder Campus School at Chembur, the area
where the appellant was residing and permitted him on occasions to keep back Anisha at
his residence. The respondent has alleged that in October 2005, taking advantage of such
a situation, the appellant kept Anisha back with him and did not return her to the
respondent's custody. This compelled the respondent to meet her daughter in the school
campus, but since this arrangement did not also work out, in the last week of November
2005, she approached the Chembur police and with their help got back the custody of her
daughter. A series of allegations were thereafter made that on 30th November, 2005 the
appellant, with the help of some of his associates, forcibly removed Anisha from the
respondent's custody and made her completely inaccessible to the respondent. It is in such
compelling circumstances that she moved the Family Court seeking custody of her minor
daughter under Section 6 of the Hindu Minority and Guardianship Act, 1956 read with
Ss. 7 and 25 of the Guardians and Wards Act, 1890.
7. The appellant herein also filed a Custody Petition, being D-66 of 2005, and both the
applications were taken up for hearing together by the learned Family Court. By its
judgment dated 2nd February, 2007 the Family Court dismissed the appellant's
application for custody and allowed the application filed by the respdondent by passing
the following order :
ORDER
The Respondent/Mohan Kumar Rayana is directed to hand over custody of the minor
daughter Anisha to the petitioner/mother Komal Rayana immediately after completion of
her final terms of the current
@page-SC473
academic session 2006-2007.
The Respondent/father shall take all the steps to provide all facilities to the minor
daughter to enjoy her extra-curricular activities and studies.
After the child Anisha goes to the custody of the mother as ordered above, the
Respondent/father would be at liberty and privilege to avail her access every alternate
weekends, meet her at school at any time and share 50% of her school vacations, as per
mutual arrangement with the petitioner/mother.
The petitioner/mother should in consultation with the Respondent/father decide the
question of her further academic education and she should not move the child out of the
jurisdiction of the Court without its prior permission and of course after due intimation to
the Respondent/father.
The father/respondent shall meet all the expenses for the education, food and clothes etc.
of the minor daughter Anisha and the Petitioner/mother of her own accord may contribute
to the same for the child and she should not be prohibited by the respondent/father from
giving the child Anisha anything for her own comfort and pleasant living. This
arrangement for custody is made on the basis of the prior consideration for the welfare of
the minor Anisha and in the event of change of circumstances either of the parents shall
be at liberty and privilege to approach this Court for fresh direction on the basis of
changed circumstances.
The custody petition D-65/05 moved by the Respondent/father Mohan Kumar Rayana
stands dismissed with visitation and access rights as ordered above."
8. Aggrieved by the said Judgment and order of the Family Court, the appellant filed
Family Court Appeal No. 29/2007 before the Bombay High Court on 23.2.2007 and the
same was admitted on 7th March, 2007 and was said to have been per-emptorily fixed for
final hearing on 26th March, 2007. On 26th March, 2007 the respondent also filed an
appeal, being Family Court Appeal No.61/2007, challenging the operation of the
judgment of the Family Court dated 2.2.2007 granting access to the appellant to meet
Anisha. The said appeal was also admitted on 3rd May, 2007. On the same day, the
directions contained in the order of the Family Court dated 2.2.07 regarding access to the
appellant to meet Anisha, were modified by the High Court by directing that the minor
child would be available to the appellant as and when he was physically present in
Bombay at his house. It was also stipulated that whenever the appellant was not available
in Bombay the child should remain with the respondent. It was specifically mentioned
that the child should not be removed by the appellant out of Bombay for any reason
whatsoever, except in the circumstances mentioned in the order.
9. A Special Leave Petition was filed by the appellant against the order of the High Court
dated 3.5.07 and the same was disposed of on 18.6.07 with a direction upon the High
Court to hear the Family Court appeal expeditiously.
10. Certain circumstances intervened which prompted the Division Bench of the Bombay
High Court to modify its order dated 3.5.07 on 12.7.07 by reducing the access granted to
the appellant and limited such access only to the day time on the ensuing Saturday and
Sunday. The said order passed in the two above-mentioned appeals is one of the orders
forming the subject matter of the appeals before us.
11. Subsequently, after interviewing the parties and the minor child, the High Court
passed a further order on 19.7.07 directing the appellant and the respondent to visit a
psychiatrist with the child and to obtain a report from him. The access granted to the
appellant on Saturdays and Sundays from 9 A.M. to 9 P.M. was continued. The said order
passed in application No.81/2007 filed by the respondent herein in Family Court Appeal
No.61/2007, is one of the other orders which form the subject matter of the present
appeals before us.
12. A third order was passed by the Bombay High Court on 27.7.07 directing the
appellant and the respondent to seek appointment with a psychiatrist within a week, and
he was also directed to submit his report within 2 weeks after the parties were examined.
The interim arrangement made earlier was directed to continue. The said order is the third
order which is impugned in the present appeals. The fourth order impugned in these
appeals was passed on 6.8.07 in the pending Civil Application No.81/2007, whereby, in
view of the intervening circumstances, the High Court passed the following order.
@page-SC474
"IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE
JURISDICTION FAMILY COURT APPEAL NO.61 OF 2007 ALONGWITH
CIVIL APPLICATION NO.81 OF 2007 ALONGWITH
FAMILY COURT APPEAL NO.29 OF 2007
Mr. R.T. Lalwani, Advocate for the applicant/wife
Mr. Kevic Settalwad Advocate i/b D.H. Law and Associates for Respondent/husband
CORAM : J.N. PATEL AND A.S. SAYED, JJ
DATE : AUGUST 6, 2007 P.C. (Per J.N. Patel, J.):
Heard. We find from the conduct of the parties that the parties are repeatedly moving this
Court in the matter on one pretext or the other. It is highly impossible for the Court to
monitor each and everything. This being matrimonial matter relating to access of the
child, the Court has issued directions from time to time and it is expected that both the
parties shall comply with the directions of this Court and facilitate each other and
cooperate with each other in the matter. But it appears that the parties are trying to
interpret the order in the manner they want, without being concerned about the welfare of
the child, which is of paramount importance. This Court has suggested to the parties to
go for counselling and already a psychiatric of J.J. Hospital is appointed for the same.
Recent development is represented by the counsel for the parties shows that on the last
date of access there was some quarrel between the parties, which lead to hospitalisation
of the wife, for injuries suffered by her and she is presently admitted in Lilawati Hospital
and likely to be discharged today or tomorrow.
2. In our considered opinion the respondent/wife deserves an opportunity to place her
affidavit on record.
3. In view of the recent development as brought to our notice, we are left with no option,
but hold all our interim orders/relief to grant access to father, in abeyance till this Court
receives report of the psychiatrist. We make it clear that the parties, if fail to cooperate
with the Court in resolving the issue, this Court would remove the matter from its board.
It is not expected from the parties to resolve their domestic quarrel in the court and ask
the Court to adjudicate each and every issue, whether minor or major, relevant or
irrelevant. We hope that the parties would maintain some discipline in observing the
orders of the Court and cooperate.
4. Parties are at liberty to mention the matter only after they comply with the orders of
this Court and report of the psychiatrist is received. Thereafter this Court proposes to pass
the further orders. The matter stands adjourned for 4 weeks. We make it clear that on the
mean time we would not entertain any application for interim relief, or for permitting the
parties to meet the child, or to take matter on board, which has led this Court to hold all
orders passed earlier in abeyance.
(A.A.SAYED, J.) (J.N. PATEL, J.)
TRUE COPY"
13. By the aforesaid order all access to the appellant was kept in abeyance till the Court
received the report of the psychiatrist. The main grievance of the appellant is that by the
order of 6.8.07 he was completely denied any access to the minor child. He was also
aggrieved by the reduction of access time by the other orders as well.
14. Since these appeals have been preferred against the interim orders passed by the
Bombay High Court in the two pending Family Court Appeals, learned counsel for the
appellant, submitted that in these appeals the only grievance of the appellant was with
regard to denial of complete access to his child. He prayed that the visitation rights
which had been granted by the Family Court be restored during the pendency of the two
appeals in the Bombay High Court.
15. Since we are only called upon to decide the said issue, we are not required to go into
any other question relating to the appeals pending before the Bombay High Court. We
have met the appellant, the respondent and also the minor child, Anisha, separately, in
chamber, to ascertain what each had to say regarding the making of interim arrangements
to allow the appellant to have access to Anisha.
16. After having looked through the materials on record and after considering the views
of the parties and the minor girl, we are of the view that the appellant should not be
denied complete access to his minor child, even if there has been a default in complying
with the directions of the High Court and that pending the disposal of the appeals he
@page-SC475
should be allowed to have access to his minor child, at least to some extent.
17. We, accordingly, dispose of these appeals with the following directions :-
i) Since the welfare of a minor child is involved, the High Court is requested to try and
dispose of the pending appeals as expeditiously as possible, but preferably within three
months from the date of communication of this order;
ii) The appellant/father of the minor, will be entitled to have access to Anisha on
weekends on Saturdays and Sundays and will be entitled, if the child is willing, to keep
her with him on Saturday night. For the said purpose, the appellant shall receive the child
from the respondent at 10.00 a.m. on Saturday from her residence at Bandra or from a
mutually agreed upon venue and shall return the child to the respondent on Sunday by
2.00 p.m. In the event Anisha is unwilling to stay with the appellant overnight, the
appellant will then make her over to the respondent on Saturday itself by 9.00 p.m.; in
that case, the appellant will be entitled to take Anisha out on Sunday also between 9.00
a.m. to 5.00 p.m.;
iii) Both the appellant as well as the respondent must co-operate with each other in
making the aforesaid arrangements work. The respondent shall not prevent the appellant
from having access to Anisha in the manner indicated above. Likewise, once Anisha is
handed over to the appellant he too must honour the aforesaid arrangements and not keep
Anisha with him beyond the time stipulated. In the event of either of the parties violating
the aforesaid arrangement, the other party would be at liberty to pray for appropriate
orders before the Bombay High Court in the pending appeals;
iv) The aforesaid arrangement is being made so that the appellant can have access to his
minor daughter and also to ensure that the childs education does not suffer in any way
during the week.
18. The appeals are, accordingly, disposed of with the aforesaid modifications of the
interim orders passed by the High Court and save as aforesaid, all the other interim
directions shall continue to remain operative.
19. Since, in terms of our earlier directions, the expenses of the respondent and Anisha
for coming from Bombay to Delhi and other litigation expenses is said to have been
deposited by the appellant with the Registry of this Court, the respondent shall be entitled
to withdraw the same. There shall be no further order as to costs in these appeals.
Order accordingly.
AIR 2008 SUPREME COURT 475 "Haryana Urban Development Authority v. Om Pal"
(From : Punjab and Haryana)*
Coram : 2 S. B. SINHA AND MARKANDEY KATJU, JJ.
Civil Appeal No. 1869 of 2007 (arising out of SLP (C) No. 23386 of 2004), D/- 10 -4
-2007.
Haryana Urban Development Authority v. Om Pal.
(A) Industrial Disputes Act (14 of 1947), S.25F, S.25B - INDUSTRIAL DISPUTE -
RETRENCHMENT - DAILY-WAGE WORKERS - Retrenchment - Reckoning
continuity of service - Period during which workman, daily wager, was working in one
establishment - Would not enure to his benefit when he was recruited separately in
another establishment - Moreso, when he was not transferred from one division to the
other.
In the instant case the workman, daily wager worked for a period of 145 days in Sub-
Division No. 2. He, however, subsequently worked in Sub-Division No. 3 for a period of
90 days. His services were terminated. It has not been denied or disputed that the two
Sub-Divisions constituted two different establishments. Only because there is one
Controlling Authority, the same by itself would not mean that the establishments were not
separate. The workman was not shown to be appointed in both the establishments by the
same authority. Thus, once two establishments are held to be separate and distinct having
different cadre strength of the workmen, if any, the period during which the workman
was working in one establishment would not enure to his benefit when he was recruited
separately in another establishment, particularly when he was not transferred from one
Sub-Division to the other. Therefore, the order directing the reinstatement of workman
with full back wages and continuity of service would be liable to be set aside.
2006 AIR SCW 5630, Ref. (Paras 5, 8)
@page-SC476
(B) Industrial Disputes Act (14 of 1947), S.11A - INDUSTRIAL DISPUTE -
TRIBUNALS - REINSTATEMENT - BACK WAGES - Powers of Tribunal - Workman
worked for short period as daily wager in 1994-95 - Award directing his reinstatement
with full back wages passed in year 2003 - Illegal. (Para 8)
Cases Referred : Chronological Paras
2006 AIR SCW 5630 (Ref) 6
Satinder Gulati, Kamaldeep Narang and Dr. Kailash Chand, for Appellant; Sanjay Bansal,
Reepak Kansal and G. K. Bansal, for Respondent.
* C. W. P. No. 5948 of 2004, D/- 8-4-2004 (PandH).
Judgement
S. B. SINHA, J. :-Leave granted.
2. Respondent herein was appointed as a daily-wager. From October, 1994 to February,
1995, he worked for a period of 145 days in Sub-Division No.2, Panipat. He, however,
worked in Sub-Division No.3 for a period of 90 days from March 1995 to July, 1995. His
services were terminated. An industrial dispute was raised questioning validity of the said
order of termination. The said industrial dispute was referred by the Appropriate
Government to the Industrial Tribunal-cum-Labour Court, Panipat, for its determination.
It was registered as Reference No.59 of 1999. By an award dated 28.2.2003, the
Industrial Court on the premise that the services rendered by the respondent in both the
Sub-Divisions should be counted for the purpose of Section 25F read with Section 25B of
the Industrial Disputes Act, 1947, directed his reinstatement with continuity of service
and full back-wages from the date of demand notice i.e. 14.9.1995. A writ petition filed
thereagainst by the appellant herein was dismissed. The appellant has, therefore, filed
this appeal by special leave.
3. The short question which arises for consideration by us in this appeal is as to whether
in the aforementioned fact situation, the Industrial Tribunal-cum-Labour Court was
justified in directing reinstatement of the respondent with full back-wages and continuity
of service. It has not been denied or disputed that the two Sub-Divisions constituted two
different establishments. Only because there is one Controlling Authority, the same by
itself would not mean that the establishments were not separate.
4. Respondent did not produce before the Industrial Tribunal-cum-Labour Court his
offers of appointment. If offers of appointment had been issued in his favour by the two
Sub-Divisions separately, the same ipso facto would lead to the conclusion that they were
separate and distinct. If his appointment was only on the basis of entry in the muster
roll(s), the designation of the authority who was authorised to appoint him as a daily-
wager would be the determinative factor. It is not the case of the respondent that he was
appointed in both the establishments by the same authority.
5. The Industrial Tribunal-cum-Labour Court unfortunately did not go into the said
question at all. If both the establishments are treated to be one establishment, for the
purpose of reckoning continuity of service within the meaning of Section 25B of the Act,
as was held by the Tribunal, a person working at different point of time in different
establishments of the statutory authority, would be entitled to claim reinstatement on the
basis thereof. However, in that event, one establishment even may not know that the
workman had worked in another establishment. In absence of such a knowledge, the
authority retrenching the workman concerned would not be able to comply with the
statutory provisions contained in Section 25F of the Act. Thus, once two establishments
are held to be separate and distinct having different cadre strength of the workmen, if
any, we are of the opinion that the period during which the workman was working in one
establishment would not enure to his benefit when he was recruited separately in another
establishment, particularly when he was not transferred from one Sub-Division to the
other. In this case he was appointed merely on daily wages.
6

. In Union of India and Others v. Jummasha Diwan [(2006) 8 SCC 544], this Court
opined : 2006 AIR SCW 5630, Para 8

".........There are several establishments of the Railway Administration. If a workman


voluntarily gives up his job in one of the establishments and joins another, the same
would not amount to his being in continuous service. When a casual employee is
employed in different establishments, may be under the same employer, e.g., the Railway
Administration of India as a whole, having different administrative set-ups, different
requirements and different projects, the concept of continuous service cannot be applied
and it cannot be said that even in such a situation he would be entitled to a higher status
being in continuous service.
@page-SC477
It is not in dispute that the establishment of Appellant 3 herein had started a project. His
recruitment in the said establishment would, therefore, constitute a fresh employment. In
a case of this nature, the Respondent would not be entitled to his seniority. If the project
came to a close, the requirements of Section 25-N of the Act were not required to be
complied with."
7. Moreover, it is now also well-settled that despite a wide discretionary power conferred
upon the Industrial Courts under Section 11A of the 1947 Act, the relief of reinstatement
with full back-wages should not be granted automatically only because it would be lawful
to do so. Grant of relief would depend on the fact situation obtaining in each case. It will
depend upon several factors; one of which would be as to whether the recruitment was
effected in terms of the statutory provisions operating in the field, if any.
8. Respondent worked for a very short period. He only worked, as noticed hereinbefore,
in 1994-95. The Industrial Tribunal-cum-Labour Court, therefore, in our opinion
committed an illegality, while passing an award in the year 2003, directing the
reinstatement of the respondent with full back-wages. Although we are of the opinion that
the respondent was not entitled to any relief, whatsoever, we direct the appellant to pay
him a sum of Rs.25,000/-.
9. This appeal is allowed to the aforementioned extent. However, in the facts and
circumstances of this case, there shall be no order as to costs.
Order accordingly.
AIR 2008 SUPREME COURT 477 "D. S. Lahoriya v. State of Rajasthan"
(From : Rajasthan)
Coram : 2 C. K. THAKKER AND P. K. BALASUBRAMANYAN, JJ.
Criminal Appeal No. 728 of 2007 (arising out of SLP (Cri.) No. 4570 of 2006), D/- 14 -5
-2007.
D. S. Lahoriya @ Rajeev Sudan @ Vinay Kr. v. State of Rajasthan.
(A) Extradition Act (34 of 1962), S.3, S.12, S.21 - Penal Code (45 of 1860), S.468 -
Explosive Substances Act (6 of 1908), S.4 - EXTRADITION - FORGERY -
EXPLOSIVE - SUPREME COURT - Extradition - Appellant was allegedly involved in
conspiracy of kidnapping to exert pressure on Government to release an alleged
Khalistani terrorist - Plea that appellant could not have been prosecuted in Indian Court
considering Extradition Treaty between America and Great Britain and extradition order
passed by American Court - Supreme Court had dealt with all contentions relating to
extradition in cognate matter - And allowed extradition of appellant for trial under
Explosive Substances Act - Prosecution, conviction and sentence of appellant under said
Act is, therefore, proper. (Paras 13, 14)
(B) Constitution of India, Art.134 - Penal Code (45 of 1860), S.364A, S.420 - Arms Act
(54 of 1959), S.4 - APPEAL - KIDNAPPING - CHEATING - FIRE ARMS - Infructuous
appeal - Kidnapping to press demand for release of terrorist - Appellant convicted under
S. 364A, I. P. C. - Order to undergo life imprisonment upheld by Supreme Court -
Appellant challenged his conviction and sentence whereby he was ordered to undergo
imprisonment for seven years - He had already undergone said sentence - No useful
purpose will be served by entertaining into merits of matter - Appeal having become
infructuous, therefore, disposed of. (Paras 12, 15, 16)
Cases Referred : Chronological Paras
2007 AIR SCW 5013 : AIR 2007 SC 2774 : 2007 Cri LJ 4080 3
2001 AIR SCW 1731 : AIR 2001 SC 1716 : 2001 Cri LJ 2188 5
Sushil Kumar, Sr. Advocate, Ms. Kamini Jaiswal, Dasvir Singh Dalee, Ms. Shomila
Bakshi, Ms. Sunita Dwivedi, Vinay Arora and Sudarshan Singh Ravat, with him for
Appellant; Milind Kumar (for Aruneshwar Gupta, Addl. Advocate General), for
Respondent.
Judgement
C. K. THAKKER, J.:-Leave granted.
2. The present appeal is filed against the judgment and order dated December 6, 2005
passed by a Single Judge of the High Court of Judicature for Rajasthan (Jaipur Bench) in
S.B. Criminal Appeal No. 332 of 2005. By the said order, a Single Judge of the High
Court dismissed the appeal filed by the appellant herein who had been convicted by the
Additional Sessions Judge (Fast Track Court) No.1, Jaipur City, Jaipur in Sessions Case
No. 27 of 2003.
3

. It is not necessary to set out facts in detail since we have stated all the facts in
reported in 2007 AIR SCW 5013

@page-SC478
Criminal Appeal No. 867 of 2006 (Suman Sood @ Kamal Jeet Kaur v. State of
Rajasthan) and a cognate matter which we have decided today. Suffice it to state that a
complaint being First Information Report (FIR) No. 84 of 1995 was registered at Malviya
Nagar Police Station, Jaipur on February 26, 1995 against Daya Singh, appellant herein,
Suman Sood @ Kamal Jeet Kaur (accused No.2) and one Harnek Singh @ Surender
Verma (absconding) for offences punishable under Sections 353, 420, 468, 471, 472, 473,
474 read with Section 120B Indian Penal Code ('IPC' for short), for offences punishable
under Sections 4 and 5 of the Explosive Substances Act, 1908, Sections 7 and 25 of Arms
Act, 1959 and Section 18 of TADA etc.
4. The case of the prosecution was that the appellant herein along with his wife Suman
Sood @ Kamal Jeet Kaur fabricated Registration Certificate for purchasing several
vehicles in order to carry out conspiracy of kidnapping and abducting one Rajender
Mirdha, son of Shri Ram Niwas Mirdha to exert pressure on the Government of India to
release one Devendra Singh Bhullar, an alleged Khalistani terrorist who was being held
in custody by the police. It was also alleged that the appellant was found to be in
possession of prohibited arms and ammunition allegedly recovered from House No. B-
117, Model Town, Ashok Nagar during police raid where the appellant was staying.
5

. Initially, prosecution was launched in the Designated Court at Ajmer since the
provisions of TADA were also invoked. The appellant herein, however, challenged his
prosecution under TADA. In Daya Singh Lahoria v. Union of India and Ors., (2001) 4
SCC 516, this Court upheld the challenge since the prosecution of the accused could only
be maintained in accordance with the Extradition Treaty and the Decree of Extradition
under which the accused were extradited by the United States of America to India.2001
AIR SCW 1731

6. Thereafter, the case was registered as Sessions Case No. 27 of 2003 under the Indian
Penal Code and also under the Explosive Substances Act, 1908. The trial Court, after
considering the evidence on record, convicted accused No.1 (appellant herein) as under:
Under Section 420 IPC : to 7 years R.I. and a fine of Rs.500/-, in default of payment of
fine, to further undergo 6 months S.I.
Under Section 468 IPC : to 7 years R.I. and a fine of Rs.500/-, in default of payment of
fine, to further undergo 6 months S.I.
Under Section 471 IPC : to 2 years R.I.
Under Section 4 of the Explosive Substances Act: to 7 years R.I. and a fine of Rs.500/-,
in default of payment of fine, to further undergo 6 months S.I.
7. So far as accused No.2 (Suman Sood) is concerned, she was acquitted by the Court
observing that the prosecution was unable to prove the case beyond doubt against her.
8. The appellant, being aggrieved by the order of conviction and sentence, preferred an
appeal in the High Court of Rajasthan. Likewise, the State of Rajasthan, being aggrieved
by an order of acquittal passed by the trial Court against Suman Sood instituted an
application for leave to appeal against acquittal.
9. A Single Judge of the High Court refused to grant leave against accused No.2 (Suman
Sood) holding that the trial Court was right in recording an order of acquittal against her
and no case had been made out to grant leave. Leave was accordingly refused.

10. So far as the appellant is concerned, at the time of hearing of appeal, it was stated by
the learned counsel for the appellant that maximum sentence awarded to the appellant
was of seven years and all sentences were ordered to run concurrently. The appellant had
already remained in jail for seven years and thus he had already undergone the sentence
of imprisonment. He, therefore, did not press the appeal. The High Court disposed of the
appeal and observed :
"At the very outset, the learned counsel Mr. G. S. Fauzdar for the accused-appellant Daya
Singh contended that maximum sentence in the present case was seven years and all the
sentences were ordered to run concurrently and appellant has already completed his
sentence of imprisonment of seven years, therefore, in these circumstances, he does not
press the appeal filed on behalf of Daya Singh, challenging his order of conviction and
sentence passed by the trial Court as mentioned above. In view of the above statement of
the learned counsel for the appellant-Daya Singh @ Vinay Kumar,
@page-SC479
the S.B. Cr. Appeal No. 332/05 filed by Daya Singh is hereby dismissed as not pressed."
11. Ms. Kamini Jaiswal, appearing for the appellant, challenged the order of conviction
and sentence. When her attention was invited by the Court to the above paragraph, she
submitted that she did not dispute that such a statement was made on behalf of the
accused in the High Court, but submitted that, she be permitted to argue the appeal,
particularly when in other Special Leave Petitions, leave was granted and appeals were
heard on merits. She also submitted that the impugned judgment and order of conviction
and sentence are ex facie, illegal, unlawful and liable to be set aside. She also submitted
that considering the Extradition Treaty of 1931 between United States of America and
Great Britain and the Extradition Order passed by the American Court on June 11, 1997,
the appellant could not have been prosecuted in Indian Court and the trial of the appellant
was without authority of law. On merits also, no case had been made out by the
prosecution. The other accused (Suman Sood) was acquitted on the same evidence and
leave to appeal against an order of acquittal was refused by the High Court. The
conviction recorded by the trial Court against the appellant on the same evidence is also
vitiated and deserves to be set aside.
12. We would have considered the prayer of the learned counsel particularly when the
case relates to administration of criminal justice and other matters were pending. In the
facts and circumstances, however, we are of the considered opinion that no useful
purpose would be served in entering into the merits of the matter.
13. So far as extradition of the appellant is concerned, we have already dealt with all
contentions relating to Extradition Treaty as well as Extradition Order exhaustively in the
other matter. There we have noted that extradition of the appellant was also allowed for
trial of offences punishable under the Explosive Substances Act, 1908.
14. In our opinion, therefore, prosecution, conviction and sentence of the appellant for
offences punishable under Explosive Substances Act, 1908 cannot be said to be without
jurisdiction or in excess of authority of law. The said contention, therefore, has no force
and must be negatived.
15. So far as the other contention is concerned, we have dismissed the appeal filed by the
appellant against his conviction for an offence punishable under Section 364A, IPC
wherein the appellant-accused has been ordered to undergo imprisonment for life. No
useful purpose, therefore, will be served by entering into the merits of the matter as the
maximum punishment awarded by the trial Court and confirmed by the High Court in the
present appeal was of seven years for the offences said to have been committed by the
appellant and the appellant had already undergone the said sentence. The counsel
appearing for the appellant in the High Court appears to have kept in view the above
position and did not press the appeal. In the light of the finding recorded by us in the
cognate matter, this appeal is, more or less, academic and has become infructuous in view
of the following circumstances;
(i) the appellant has been convicted for an offence punishable under Section 364A, IPC
and has been ordered to undergo sentence of imprisonment for life and we have upheld
the said order; and
(ii) in the present appeal, the appellant has challenged his conviction and sentence
whereby he has been ordered to undergo imprisonment for seven years. The appellant has
remained in jail for seven years and the said period is over.
16. For the foregoing reasons, the appeal deserves to be disposed of and is accordingly
disposed of without entering into merits of the case.
Order accordingly.
AIR 2008 SUPREME COURT 479 "Amarsingh Munnasingh Suryawanshi v. State of
Maharashtra"
(From : Bombay)
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Criminal Appeal No. 97 of 2006, D/- 27 -9 -2007.
Amarsingh Munnasingh Suryawanshi v. State of Maharashtra.
(A) Evidence Act (1 of 1872), S.32 - DYING DECLARATION - Dying declaration -
Credibility - Thumb impression of deceased taken - Endorsement of Medical Officer also
obtained to the effect that deceased had all along been conscious when her dying
declaration was recorded - Contradiction in deposition of doctor making endorsement -
On first day of examination he stated that he had made endorsement after dying
declration was recorded - But after he was recalled
@page-SC480
for re-examination and cross-examination he stated that he had made his signature on
margin of blank paper on which dying declaration was recorded - Such contradiction
liable to be ignored because doctor was examined after more than six years after date of
making endorsement. (Paras 19, 20)
(B) Evidence Act (1 of 1872), S.32 - DYING DECLARATION - Dying declaration -
Credibility - Two dying declarations - Both recorded in different languages - Deceased
proficient in both languages - Dying declarations cannot be challenged. (Para 21)
(C) Evidence Act (1 of 1872), S.32 - DYING DECLARATION - POLICE OFFICERS -
MAGISTRATE - Dying declaration - Credibility - First dying declaration recorded by
Police Officer after consulting doctor and after satisfying himself on basis of advice by
doctor that deceased was in fit mental condition to give statement - Second dying
declaration recorded by Special Judicial Magistrate when Medical Officer was present at
that place - Dying declarations cannot be challenged on ground that it was obligatory on
part of Police Officer or Special Judicial Magistrate to put question to deceased about
whether she was in mental condition to make her statement.(Paras 32, 33)
(D) Evidence Act (1 of 1872), S.32 - DYING DECLARATION - WITNESS - Dying
declaration - Credibility - Witness who recorded dying declaration categorically stating
that he had been asking questions to which deceased was giving replies - Fact that dying
declaration was not in question and answer form - Not material. (Para 15)
(E) Penal Code (45 of 1860), S.300 - MURDER - WITNESS - Murder of wife by
husband - Proof - Son of deceased residing with relatives of accused-husband for six
years before he came to Court for deposition - Fact that he went back from statement
made by him under S. 161, Cr. P. C. and did not support prosecution case - Would not
lead to conclusion that prosecution failed to prove its case.
Evidence Act (1 of 1872), S.154. (Para 34)
(F) Penal Code (45 of 1860), S.300 - MURDER - PLEA - Murder - Proof - Murder of
wife by husband - Plea of alibi not proved by accused - No explanation offered by him as
to why he was absconding for about a month - Husband and wife with their children
living in one room and besides their children only husband and wife were present in
house at time of occurrence - Fact that kerosene was put on wife's body and fire was lit
was proved - Husband must be held to be aware that such act was likely to cause death in
ordinary course of nature - No evidence to show that death was result of accident -
Conviction of accused for murder upheld. (Paras 35 , 36, 37)
Cases Referred : Chronological Paras
2007 AIR SCW 295 : 2007 (2) AIR Jhar R 177 : 2007 Cri LJ 1174 (Foll.) Pt.G) 35
2007 AIR SCW 4820 : AIR 2007 SC 2666 : 2007 Cri LJ 3737 : 2007 (5) AIR Kar R 275
31
2007 AIR SCW 5995 : 2007 Cri LJ 4722 31
2007 AIR SCW 6021 31
2006 AIR SCW 1037 : AIR 2006 SC 1448 : 2006 Cri LJ 1625 : 2006 (2) AIR Jhar R 325
(Foll.) 28
2006 AIR SCW 1053 : AIR 2006 SC 1319 : 2006 Cri LJ 1629 : 2006 (2) AIR Jhar R 292
(Disting.) 29
AIR 1976 SC 1994 : 1976 Cri LJ 1548 30
AIR 1958 SC 465 : 1958 Cri LJ 818 37
S. D. Singh, Vijay Kumar, Vishwajit Singh and Makarand D. Adkar, for Appellant;
Chinmoy Khaladkar and Ravindra Keshavrao Adsure, for Respondent.
Judgement
S. B. SINHA, J.:-Appellant is before us being aggrieved by and dissatisfied with the
judgment dated 19.7.2005 passed by a Division Bench of the Bombay High Court,
Aurangabad Bench, in Criminal Appeal No. 576 of 1996 dismissing the appeal preferred
by him against the judgment and order of conviction and sentence dated 7.9.1996 of the
learned Additional Sessions Judge, Jalna under Section 302, I.P.C. in Sessions Case No.
24 of 1991.
2. Kamlabai, the deceased, was married to the appellant 15 years prior to the incident
which took place at about 9.00 p.m. on 7.6.1990. The couple had five children - two
daughters and three sons - all being minor at the material time. Appellant was not doing
any work. He was said to be addicted to liquor. Deceased used to work as a labourer in
Bajrang Dal Mill.
3. It is the case of the prosecution that she had all along been ill-treated by her
@page-SC481
husband. On the fateful day of 7.6.1990, she came from work at about 6.30 p.m. She had
prepared food. At about 9 p.m. when she was serving food to the appellant, he took out
kerosene from the lamp, poured it on her and set her ablaze. He, thereafter, fled away
from the place.
4. On hearing her cries, the neighbours came and extinguished the fire. But she was left at
lurch. It appears that somebody informed her uncle-Laxmansingh who visited her next
day morning. He took her to the Civil Hospital, Jalna.
5. The said incident having been reported to the police authorities, the Officer In-charge
of the Police Station asked the Head Constable Sitaram to visit the hospital. He visited
the hospital at about 8.45 p.m. and recorded the dying declaration of the deceased which
was marked as Exhibit 37 before the learned trial Judge. On the said basis, a First
Information Report was lodged. Another dying declaration was recorded by the Special
Judicial Magistrate at about 3.15 p.m. on the same day. The said dying declaration was
marked as Exhibit 43 before the learned Sessions Judge.
6. We may notice that the deceased breathed her last on 22.6.1990, i.e., about 15 days
after the incident.
7. Despite the appellant having been named in the First Information Report, in the
aforementioned two dying declarations, he could not be arrested as he was absconding.
He surrendered only on 5.7.1990.
8. Before the learned trial Judge twelve witnesses were examined on behalf of
prosecution. Apart from P.W.2-Vinod son of the deceased, no other witness was examined
by the prosecution to prove the act of commission of the offence. He, however, turned
hostile. It also appears that other prosecution witnesses also did not support the
prosecution case.
9. We may, however, notice that the defence of the appellant was that at the relevant time
he was in Bombay. In support of the said defence, however, he did not examine any
witness.
10. Learned trial Judge upon consideration of the materials on record, recorded a
judgment of conviction against the appellant. He was sentenced to undergo rigorous
imprisonment for life. Appeal preferred by him has been dismissed by the High Court by
reason of the impugned judgment.
11. Learned counsel appearing on behalf of the appellant would submit;
(i) none of the two dying declarations Exhibits 37 and 43 being reliable, the learned trial
Judge as also the High Court committed a serious error in recording a judgment of
conviction against the appellant;
(ii) no certificate having been obtained to the effect that the deceased was in a fit mental
condition to make the said statement, the dying declaration should not have been relied
upon;
(iii) one of the dying declarations having been recorded in Marathi language and another
in Hindi, a doubt is created as to whether the deceased understood the implication of the
statements made by her;
(iv) P.W.2-Vinod was the only eye-witness to the incident and he having not supported
the prosecution case, the impugned judgment is wholly unsustainable;
(v) The learned trial Judge as also the High Court failed to apply their mind in regard to
various infirmities in the prosecution case.
12. Mr. Chinmoy Khaladkar, learned counsel appearing for the State, on the other hand,
supported the impugned judgment.
13. Indisputably, apart from the two dying declarations, no substantive evidence has been
brought on record to prove the prosecution case. We will at the outset consider as to
whether the said two dying declarations are trustworthy in nature. The first dying
declaration was recorded by P.W.6-Head Constable Sitaram. He before recording the
dying declaration took the opinion of the Medical Officer. He was told that the deceased
was conscious and fit to make a statement. Only thereafter the statement of Kamlabai was
recorded.
14. We have been taken through the deposition of Sitaram. It may be true that on the body
of dying declaration, he did not mention as to whether the left thumb or the right thumb
impression had been taken, but as has been noticed by the learned trial Judge that her left
hand fingers being burnt and there being only some burn injuries on the right hand, only
inference which could be drawn was that in the absence of any material having been on
record to show that the thumb impression of the deceased was a forged one, it was the
right thumb impression.
@page-SC482
15. The said witness categorically stated that he did take down the statement of the
deceased in Marathi language although the mother tongue of the deceased was Hindi.
Both the witnesses knew Hindi. They also knew Marathi. Before P.W.6- Head Constable
Sitaram the deceased gave her statement in Marathi, which was recorded in the said
language. The first dying declaration was not in the question and answer form, but it was
not necessary. The witness had categorically stated that he had been asking questions to
which the deceased was giving replies.
16. The other dying declaration, as noticed, hereinbefore, was recorded by P.W.8-Sharad
who was the Special Judicial Magistrate. He was asked by P.W.6 to record the dying
declaration of the deceased. Before recording the dying declaration, this witness took the
necessary precaution of obtaining the opinion of the medical officer as to whether she
was in a fit mental condition to give her statement and having received the answer in the
affirmative, he had recorded the statement of the deceased in question and answer form.
17. In the said dying declaration (Exhibit 43), not only the thumb impression of the
deceased was taken but endorsement of the medical officer was also obtained to the effect
that she had all along been conscious when her dying declaration was recorded and an
endorsement to that effect was also made by Dr. Shantilal who examined himself as
P.W.12.
18. From the evidence of Dr. Shantilal, it appears that the deceased had suffered
superficial to deep burns being to the extent of 43-45%. She died of septicaemia with
shock due to extensive burns with cardio-respiratory failure.
19. The only contradiction which appears to have been brought on record in his
deposition is that on the first day of the examination he stated that he had made the
endorsement after the dying declaration was recorded, but after he was recalled for re-
examination and cross-examination he stated that he had made his signature on the
margin of blank paper on which the dying declaration was recorded.
20. Learned trial Judge, in our opinion, has rightly ignored the aforementioned minor
contradiction having regard to the fact that he was examined after more than six years
after the date of making the aforementioned endorsement.
21. So far as the submission of learned counsel that the first dying declaration was
recorded in Marathi and the second dying declaration in Hindi is concerned, the same, in
our view, does not make any difference as she was proficient in both the languages. Her
mother tongue being Hindi she evidently knew that language, but the same would not
mean that she being resident of Maharasthra for a long time would not know the Marathi
language. Admittedly, the appellant (her husband) is a Marathi.
22. The deceased, as noticed hereinbefore, suffered superficial to deep burn injuries and
as such injuries were on the organs such as hands, fingers, legs, etc. She did not suffer
any burn injury on the upper part of the body. She suffered agony and pain throughout the
night of 7.6.1990.
23. We have noticed hereinbefore that on both the occasions the medical officer certified
that she was in a fit mental state to give her dying declaration.
24. Both the witnesses who recorded her dying declarations satisfied themselves that the
deceased answered the questions after understanding the effect thereof.
25. Learned counsel submitted that in the dying declaration dated 8.6.1990, the deceased
in answer to the question as to who was at home, disclosed that besides she and her
husband nobody else was there, although according to the prosecution case, P.W.2 Vinod
was present.
26. It may be noticed that while answering the question which was posed to her, namely,
when the incident happened who was at home? In answer thereto she had stated "I and
my husband were there nobody else was there" which evidently would mean that no
outsider was present. It is not the case of the appellant that children on the date of
occurrence were residing somewhere else.
27. It is now a well settled principle of law that a conviction can be based on the dying
declaration alone, subject of course, to the satisfaction of the Court that the same is
trustworthy.
28

. In Ravi Kumar alias Kutti Ravi vs. State of Tamil Nadu, (2006) 9 SCC 240, this Court
held as under: 2006 AIR SCW 1037, (Para 4)

"5. ... The dying declaration is admissible


@page-SC483
upon consideration that the declarant has made it in extremity, when the maker is at the
point of death and when every hope of this world is gone, when every motive to the
falsehood is silenced and the mind is induced by the most powerful consideration to
speak the truth. Notwithstanding the same, care and caution must be exercised in
considering the weight to be given to these species of evidence on account of the
existence of many circumstances which may affect their truth. The court has always to be
on guard to see that the statement of the deceased was not the result of either tutoring or
prompting or a product of imagination. The court has also to see and ensure that the
deceased was in a fit state of mind and had the opportunity to observe and identify the
assailant. Normally, therefore, the court in order to satisfy itself that the deceased was in
fit mental condition to make the dying declaration, has to look for the medical opinion.
Once the court is satisfied that the declaration was true and voluntary, it undoubtedly, can
base its conviction on dying declaration without any further corroboration. It cannot be
laid down as an absolute rule of law that the dying declaration cannot form the sole basis
of conviction unless it is corroborated. The rule requiring corroboration is merely the rule
of prudence."
29
. Learned counsel appearing on behalf of the appellant, however, has strongly relied upon
a decision of this Court in P. Mani vs. State of Tamil Nadu, (2006) 3 SCC 161. In that
case this Court noticed the factual matrix thus: 2006 AIR SCW 1053

"12. ...........The incident admittedly took place inside a small room. It had two doors. The
prosecution witnesses knocked on both the doors. Their call to the deceased to open the
door remained unanswered and only then they took recourse to breaking open the door.
According to them, not only the appellant herein was with them at that point of time, but
also he took part in dousing the flames. Indisputably, he took the deceased to the hospital.
If the version of the deceased in her dying declaration is accepted as correct, the
witnesses and in particular the neighbours would have lodged a First Information Report
and in any event would not have permitted the appellant to take her to the hospital."
"14. Indisputably conviction can be recorded on the basis of dying declaration alone but
therefor the same must be wholly reliable.
(Emphasis supplied)
The said decision, therefore, is of no assistance to the appellant as apart from the fact that
factual matrix of the matter was different, as a proposition of law it has clearly been laid
down that conviction can be based on dying declaration alone.
30

. In K. Ramachandra Reddy and another vs. The Public Prosecutor, (1976) 3 SCC 618,
whereupon reliance has been placed this Court came to the conclusion that the
prosecution case was not reliable at all. A large number of discrepancies were also found
in the evidence of the doctor vis-a-vis the Magistrate who had recorded the said dying
declaration. It was noticed: AIR 1976 SC 1994

"11.....The Magistrate P.W. 11 who recorded the dying declaration has admitted that the
injured was suffering from pain and he was not in a position to sign and so his thumb
impression was taken. The Magistrate further admitted that the injured was taking time to
answer the questions. The Magistrate further admitted that the injured was very much
suffering with pain. In spite of these facts the Magistrate appears to have committed a
serious irregularity in not putting a direct question to the injured whether he was capable
mentally to make any statement."
31

. In Mehiboobsab Abbasabi Nadaf Vs. State of Karnataka (2007 (9) SCALE 473, this
Court held: 2007 AIR SCW 4820

"6. Conviction can indisputably be based on a dying declaration. But, before it can be
acted upon, the same must be held to have been rendered voluntarily and truthfully.
Consistency in the dying declaration is the relevant factor for placing full reliance
thereupon. In this case, the deceased herself had taken contradictory and inconsistent
stand in different dying declarations. They, therefore, should not be accepted on their face
value. Caution, in this behalf, is required to be applied.
Recently, in State of Rajasthan vs. Parthu (2007 (11) SCALE 460), it was held: 2007
AIR SCW 5995

"(12) It is now a well settled principles of law that a judgment of conviction can be
recorded on the basis of the dying declaration alone subject of course to the
@page-SC484
satisfaction of the Court that the same was true and voluntary. For the purpose of
ascertaining truth or voluntariness of the dying declaration, the Court may look to the
other circumstances. Apart from the fact, as noticed hereinbefore, that the homicidal
nature of death was not disputed by the respondent herein and furthermore as he in his
statement under Section 313 had raised a positive defence that she died of an accident, we
are of the opinion the High Court adopted a wrong approach. It is not disputed that the
deceased and the appellant were living separately from their family. It has also not been
disputed that at the time when the incident occurred, the respondent was in his house
together with the deceased. It is furthermore not in dispute that after the incident took
place, the respondent was not to be found. He was arrested only on 20-6-1995. If the
deceased and the respondent were together in their house at the time when the incident
took place which was at about 10 O'clock in the night, it was for the respondent to show
as to how the death of the deceased took place."

(See also Nallapati Sivaiah vs. Sub-Divisional Officer, Guntur, A.P.-2007 (11) SCALE
477). 2007 AIR SCW 6021

32. Learned counsel would submit that it was obligatory on the part of both P.W.6 Head
Constable Sitaram and P.W.8 Special Judicial Magistrate-Sharad to satisfy themselves
that the deceased was in a mental condition to make her statement and to prove the said
fact it was obligatory on their part to put a question in that behalf to the deceased.
33. In this case as noticed hereinbefore, when the dying declaration was recorded by
P.W.6 Head Constable Sitaram, he consulted the doctor and recorded the dying
declaration only after he satisfied himself on the basis of the advice given to him that the
patient was in a fit mental condition to give her statement. So far as dying declaration
recorded by P.W.8 Special Judicial Magistrate-Sharad is concerned, we have noticed
hereinbefore that he took all the precautions and in fact a medical officer was present
when the said dying declaration was being recorded.
34. P.W.2 Vinod was the son of the appellant. He had remained with the relatives of the
appellant for six years before he came to the court for deposition. If he had gone back
from his statement made by him under Section 161, Cr.P.C., and did not support the
prosecution case, the same, in our opinion, by itself would not lead to the conclusion that
the prosecution has failed to prove its case.
35

. There cannot be any doubt whatsoever that the appellant had not been able to prove his
alibi. He did not examine any witness to support his case. He did not offer any
explanation whatsoever as to why for about a month he was absconding. In a situation of
this nature where admittedly the husband, wife and children were residing in one room,
the prosecution having been able to prove that apart from the minor children, at the time
of occurrence it was he and the deceased alone who were residing in the house, it was for
the appellant to prove that how the deceased had met her death. This aspect of the matter
was considered by this Court in Raj Kumar Prasad Tamarkar vs. State of Bihar and
Another,(2007) 1 SCALE 19. 2007 AIR SCW 295

36. The cause of death is not in dispute. What was contended by the appellant was that
the death was not homicidal in nature but it was a result of an accident. Yet again, nothing
has been brought on record to show that the death was a result of any accident.
37

. The fact remains that the kerosene was put on her body and fire was lit. We, thus, cannot
accept the plea of the learned counsel appearing on behalf of the appellant that there was
no intention on the part of the accused to cause her death. He must be held to be aware
that such an act was likely to cause death in the ordinary course of nature. (See Virsa
Singh vs. State of Punjab, 1958 SCR 1495). AIR 1958 SC 465

38. For the reasons aforementioned we do not find any merit in this appeal. The appeal is
dismissed accordingly.
Appeal dismissed.
AIR 2008 SUPREME COURT 484 "National Insurance Co. Ltd. v. Cholleti
Bharatamma"
(From : Andhra Pradesh)*
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Civil Appeal Nos. 4845-4847 with 4848-4850, 4851, 4852-54 of 2007 (arising out of SLP
(C) Nos. 7237-7239 with 7241-7243, 7248 and 7288-7290 of 2003), D/- 12 -10 -2007.
National Insurance Co. Ltd. v. Cholleti Bharatamma and Ors.
(A) Motor Vehicles Act (59 of 1988), S.147 (before amendment in year 1994) - MOTOR
VEHICLES - CARRIAGE OF GOODS - INSURANCE - - Goods carriage - Carrying
passengers
@page-SC485
Accident - Insurance Company would be liable for death and injury of said passengers.
A. A. O. Nos. 1387, 1901 and 1923 of 1998, D/- 13-11-2002 (AP), Partly Reversed.
(Paras 12, 14)
(B) Motor Vehicles Act (59 of 1988), S.147 - MOTOR VEHICLES - CARRIAGE OF
GOODS - INSURANCE - Liability of insurer - Goods carriage - No proof that deceased
was travelling in lorry along with driver or cleaner, as owner of goods - Travelling with
goods itself does not entitle anyone to protection under S. 147 - Deceased held, not
entitled to protection under S. 147. (Para 18)
(C) Motor Vehicles Act (59 of 1988), S.147 - MOTOR VEHICLES - INSURANCE -
CARRIAGE OF GOODS - Liability of insurer - Goods carriage - Carrying 20 persons -
Premium paid only for one person travelling as owner - Claimants of deceased who was
travelling as owner of goods, held entitled to compensation.(Paras 23, 24)
(D) Motor Vehicles Act (59 of 1988), S.147 - MOTOR VEHICLES - INSURANCE -
CARRIAGE OF GOODS - Liability of insurer - Goods carriage carrying passengers -
Accident - Evidence of one of passengers showing that he was travelling in vehicle with
his goods as owner and not the deceased - Deceased thus was gratuitous passenger and
policy would not cover his life - Insurance Company not liable.
A. A. O. Nos. 1387, 1901 and 1923 of 1998, D/- 13-11-2002 (AP), Reversed. (Para
31)
Cases Referred : Chronological Paras
2007 AIR SCW 1505 : AIR 2007 SC 1334 : 2007 (3) ALJ 193 : 2007 (2) AIR Jhar R 772
(Foll.) (Pt. A) 11
2007 AIR SCW 3734 : AIR 2007 SC 1971 11
(2005) 12 SCC 243 (Foll.) Pt. A) 10
2004 AIR SCW 212 : AIR 2004 SC 1340 (Foll.) (Pt.A) 10
2002 AIR SCW 5259 : AIR 2003 SC 607 (Foll.) (Pt.A) 9, 10, 29
2001 AIR SCW 3291 : AIR 2001 SC 3363 7
1999 AIR SCW 255 : AIR 1999 SC 589 9
1999 AIR SCW 4337 : AIR 2000 SC 235 5, 6, 9, 13, 16, 23, 29, 30
1996 AIR SCW 2466 : AIR 1996 SC 2054 15
Dr. Laxmi Shashtri, Ms. Kiran Suri, Kishore Rawat, M. K. Dua, Pramod Dayal, Vishnu
Mehra and B.K. Satija, for Appellant; Dr. Sushil Balwada, Vidya K. Sagar, B. D. Sharma,
Ms. Asha Gopalan Nair, A. V. Rao, Prabhakar Parnam and Venkateswara Rao Anumolu,
for Respondents.
* A. A. O. Nos. 1387, 1901 and 1923 of 1998, D/- 13-11-2002 (AP).
Judgement
1. S. B. SINHA, J.:-Leave granted in all the Special Leave Petitions.
2. The question involved in these appeals centres around the liability of the insurance
company to indemnity the owner of the vehicle in respect of death of passengers
travelling in goods carriage. The dates of accident being different, different provisions
would apply. We would notice the law operating in the field at the outset and apply the
same in each case separately.
3. The relevant portion of Section 147 of the Motor Vehicles Act (for short "the Act"),
prior to its amendment, reads as under:
"Requirements of policies and limits of liability.- (1) In order to comply with the
requirements of this Chapter, a policy of insurance may be a policy which-
(a) ***
(b) insures the person or classes of persons specified in the policy to the extent specified
in sub-section (2)-
(i) against any liability which may be incurred by him in respect of the death of or bodily
injury to any person or damage to any property of a third party caused by a or arising out
of the use of the vehicle in a public place;
(ii) ***
Provided that a policy shall not be required-
(i) to cover liability in respect of the death, arising out of and in the course of his
employment, of the employees insured by the policy or in respect of bodily injury
sustained by such an employee arising out of and in the course of his employment other
than a liability arising under the Workmen's Compensation Act, 1923, in respect of the
death of, or bodily injury to, any such employee-
(a) ***
(b) ***
(c) if it is a goods vehicle, being carried in the vehicle; or
(ii) except where the vehicle is a vehicle in which passengers are carried for hire or
reward or by reason of or in pursuance of contract of employment, to cover liability in
respect of the death of or bodily injury to persons being carried in or upon or
@page-SC486
entering or mounting or alighting from the vehicle at the time of the occurrence of the
event out of which a claim arises..."
4. The said provision underwent an amendment in the year 1994 by Motor Vehicles
Amendment Act, 1994 which reads as under:
"147 - Requirements of policies and limits of liability
(1) In order to comply with the requirements of this Chapter, a policy of insurance must
be a policy which-
(a) ***
(b) insures the person or classes of persons specified in the policy to the extent specified
in sub- section (2)-
(i) against any liability which may be incurred by him in respect of the death of or bodily
[injury to any person, including owner of the goods or his authorised representative
carried in the vehicle] or damage to any property of a third party caused by or arising out
of the use of the vehicle in a public place;
(ii) ***
5

. In New India Insurance Co. v. Satpal Singh and Ors. [(2000) 1 SCC 237], this Court
proceeded on an assumption that the provisions of 1939 Act and the provisions of 1988
Act are in pari materia. 1999 AIR SCW 4337

6. In Satpal Singh (supra), interpreting the provisions contained in Sections 147 and 149
of the Motor Vehicles Act, this Court held:
"...Hence, under sub-section (2), there is no upper limitation for the insurer regarding the
amount of compensation awarded in respect of death or bodily injury of a victim of the
accident. It is, therefore, apparent that the limit contained in the old Act has been
removed and the policy should insure the liability incurred and cover injury to any person
including owner of the goods or his authorised representative carried in the vehicle . The
legislature has also taken care of even the policies which were in force on the date of
commencement of the Act by specifically providing that any policy of insurance
containing any limit regarding the insurers liability shall continue to be effective for a
period of four months from commencement of the Act or till the date of expiry of such
policy, whichever is earlier. This means, after the said period of four months, a new
insurance policy consistent with the new Act is required to be obtained.
11. The result is that under the new Act an insurance policy covering third-party risk is
not required to exclude gratuitous passengers in a vehicle, no matter that the vehicle is of
any type or class. Hence the decisions rendered under the old Act vis-a-vis gratuitous
passengers are of no avail while considering the liability of the insurance company in
respect of any accident which occurred or would occur after the new Act came into
force."
7
. In Ramesh Kumar v. National Insurance Co. Ltd. and Anr. [(2001) 6 SCC 713], this
Court categorized the cases arise out of the Motor Vehicles Act, 1939, stating: 2001
AIR SCW 3291

"The first category of cases arise out of the Motor Vehicles Act, 1939 (hereinafter
referred to as "the old Act"). The question raised for this category is:
'Whether the insurance company is liable to pay the compensation on account of the
death or bodily injury of the gratuitous passengers including the owner of the goods or
his representative, travelling in a goods vehicle under Section 95 of the said Act?'

The second category of cases arise out of the Motor Vehciles Act, 1988 (hereinafter
referred to as "the new Act") prior to its amendment in 1994. In this category also a
similar question is raised. The third category of cases also arises under the new Act but
after its amendment by Act 54 of 1994. In this category also the same question is raised."
8. The Act does not contemplate that a goods carriage shall carry a large number of
passengers with small percentage of goods as considerably the insurance policy covers
the death or injuries either of the owner of the goods or his authorized representative.
9

. Correctness of the decision in Satpal Singh (supra) came up for consideration before a
three-Judge Bench of this Court in New India Assurance Co. Ltd. v. Asha Rani and others
[(2003) 2 SCC 223]. 1999 AIR SCW 4337
2002 AIR SCW 5259

In Asha Rani (supra), having regard to various definitions involving the legal question, it
was held:

"23. The applicability of the decision of this Court in Mallawwa v. Oriental Insurance Co.
Ltd., in this case must be considered 1999 AIR SCW 255

@page-SC487
keeping that aspect in view. Section2(35) of the 1988 Act does not include passengers in
goods carriage whereas Section2(25) of the 1939 Act did as even passengers could be
carried in a goods vehicle. The difference in the definitions of "goods vehicle" in the
1939 Act and "goods carriage" in the 1988 Act is significant. By reason of the change in
the definitions of the terminology, the legislature intended that a goods vehicle could not
carry any passenger, as the words "in addition to passengers" occurring in the definition
of goods vehicle in the 1939 Act were omitted. Furthermore, it categorically states that
"goods carriage" would mean a motor vehicle constructed or adapted for use "solely for
the carriage of goods". Carrying of passengers in a "goods carriage", thus, is not
contemplated under the 1988 Act.
24. We have further noticed that Section 147 of the 1988 Act prescribing the requirements
of an insurance policy does not contain a provision similar to clause (ii) of the proviso
appended to Section 95 of the 1939 Act. The decision of this Court in Mallawwa case
must be held to have been rendered having regard to the aforementioned provisions.
25. Section 147 of the 1988 Act, inter alia, prescribes compulsory coverage against the
death of or bodily injury to any passenger of "public service vehicle". Proviso appended
thereto categorically states that compulsory coverage in respect of drivers and conductors
of public service vehicle and employees carried in a goods vehicle would be limited to
the liability under the Workmen's Compensation Act. It does not speak of any passenger
in a "goods carriage."
26. In view of the changes in the relevant provisions in the 1988 Act vis-a-vis the 1939
Act, we are of the opinion that the meaning of the words "any person" must also be
attributed having regard to the context in which they have been used i.e. "a third party".
Keeping in view the provisions of the 1988 Act, we are of the opinion that as the
provisions thereof do not enjoin any statutory liability on the owner of a vehicle to get his
vehicle insured for any passenger travelling in a goods vehicle, the insurers would not be
liable therefor.
27. Furthermore, sub-clause (i) of clause (b) of sub-section (1) of Section 147 speaks of
liability which may be incurred by the owner of a vehicle in respect of death of or bodily
injury to any person or damage to any property of a third party caused by or arising out of
the use of the vehicle in a public place, whereas sub-clause (ii) thereof deals with liability
which may be incurred by the owner of a vehicle against the death of or bodily injury to
any passenger of a public service vehicle caused by or arising out of the use of the
vehicle in a public place.

28. An owner of a passenger-carrying vehicle must pay premium for covering the risks of
the passengers. If a liability other than the limited liability provided for under the Act is
to be enhanced under an insurance policy, additional premium is required to be paid. But
if the ratio of this Court's decision in New India Assurance Co. v. Satpal Singh, is taken to
its logical conclusion, although for such passengers, the owner of a goods carriage need
not take out an insurance policy, they would be deemed to have been covered under the
policy wherefor even no premium is required to be paid." 1999 AIR SCW 4337

10

. The effect of 1994 amendment came up for consideration in National Insurance Co. Ltd.
v. Baljit Kaur and Ors. [(2004) 2 SCC 1], wherein this court following Asha Rani (supra)
opined that the words "injury to any person" would only mean a third party and not a
passenger travelling on a goods carriage whether gratuitous or otherwise. The question
came up for consideration again in National Insurance Co. Ltd. v. Bommithi
Subbhayamma and Ors. [(2005) 12 SCC 243] wherein upon taking into consideration a
large number of decisions, the said view was reiterated. 2004 AIR SCW 212

11

. Yet again in New India Assurance Co. Ltd. v. Vedwati and Ors. [(2007) 3 SCALE 397]
this Court held: 2007 AIR SCW 1505

"13. The difference in the language of "goods vehicle" as appear in the old Act and
"goods carriage" in the Act is of significance. A bare reading of the provisions makes it
clear that the legislative intent was to prohibit goods vehicle from carrying any passenger.
This is clear from the expression "in addition to passengers" as contained in definition of
"goods vehicle" in the old Act. The position becomes further clear because the expression
used is "goods carriage" is solely for the carriage of goods. Carrying of passengers in a
goods carriage is not contemplated in the Act. There is no provision
@page-SC488
similar to Clause (ii) of the proviso appended to Section 95 of the old Act prescribing
requirement of insurance policy. Even Section 147 of the Act mandates compulsory
coverage against death of or bodily injury to any passenger of "public service vehicle".
The proviso makes it further clear that compulsory coverage in respect of drivers and
conductors of public service vehicle and employees carried in goods vehicle would be
limited to liability under the Workmen's Compensation Act, 1923 (in short 'WC Act").
There is no reference to any passenger in "goods carriage".
14. The inevitable conclusion, therefore, is that provisions of the Act do not enjoin any
statutory liability on the owner of a vehicle to get his vehicle insured for any passenger
travelling in a goods carriage and the insurer would have no liability therefor."

[See also Oriental Insurance Co. Ltd. v. Brij Mohan and Ors. 2007 (7) SCALE 753]
2007 AIR SCW 3734

CA @ SLP (C) Nos.7237-7239 of 2003


12. The claimants were travelling in a lorry. It was a goods carriage carrying goods like
rice, tent hours articles, chairs, utensils and vegetables required on the occasions of
marriage. The marriage of one D. Bhaskar was to take place. When the lorry reached Ali
Nagar cross road at about 8.30 a.m., as a result of rash and negligent driving of the driver,
the accident took place as the lorry struck to a stationary truck. Several people suffered
injuries. Two of them died. Several claim applications were filed on behalf of the injured
as also the dependents of the deceased.
The date of accident being 16.12.1993, the amendment carried out in the year 1994 in
Section 147 of the Motor Vehicles Act would not be applicable.
13. The Motor Accident Claims Tribunal, Nalgonda, by a judgment and award dated
13.11.1997 awarded various sums overruling the defence of the appellant herein that they
were unauthorized passengers. The High Court, however, by reason of the impugned
judgment, relying on or on the basis of a decision of this Court in Satpal Singh (supra)
directed as under:

"The learned counsel for the Insurance Company submitted that the issue involved in
these appeals is squarely covered by the decision of the Supreme Court in the case
reported in New Indian Assurance Company Ltd. v. Satpal Singh, 2000 ACJ 1, wherein
their Lordships held that under the Motor Vehicles Act, 1988 all insurance policies
covering third party risks are not required to exclude gratuitous passengers in the Vehicle
though Vehicle is of any type or class. 1999 AIR SCW 4337

In view of the proposition of law laid down by the Supreme Court in the decision stated
supra, these appeals are dismissed. No costs."
14. Following the aforementioned principles, the impugned judgment cannot be sustained
which is set aside. The appeals are allowed accordingly.
CA @ SLP (C) No.7241-7243/03
15. In the aforementioned case, accident took place on 24.12.1993. Respondents herein
filed a claim petition claiming compensation for the death of one Kota Venkatarao who
had allegedly paid a sum of Rs. 20/- for travelling in the lorry. The Tribunal held:

"In the absence of rebuttal evidence from the deceased and some others travelled in the
said vehicle in the capacity of owner of the luggage which was carried by them at the
time of accident. It cannot be said that it is a violation of the policy, since it is not
fundamental breach so as to afford to the insurer to eschew the liability altogether as per
the decision reported in AIR 1996 Supreme Court 2054." 1996 AIR SCW 2466

16. The High Court, however, relying upon Satpal Singh (supra) opined:

"This issue raised in this appeal is covered by the decision of the Supreme Court in New
India Assustance Co. Ltd. v. Satpal Singh [(2000) 1 SCC 237] wherein their Lordships
held that under the Motor Vehicles Act, 1988 all Insurance policies covering third party
risks are not required to exclude gratuitous passengers in the vehicles though the vehicle
is of any type or class. Following the same, the appeal is dismissed. No order as to costs."
1999 AIR SCW 4337

17. It is now well settled that the owner of the goods means only the person who travels
in the cabin of the vehicle.
18. In this case, the High Court had proceeded on the basis that they were gratuitous
passengers. The admitted plea of the respondents themselves was that the
@page-SC489
deceased had boarded the lorry and paid an amount of Rs.20/- as transport charges. It has
not been proved that the deceased was travelling in the lorry along with the driver or the
cleaner as the owner of the goods. Travelling with the goods itself does not entitle anyone
to protection under Section 147 of the Motor Vehicles Act.
19. For the reasons aforementioned, this appeal is dismissed.
CA @ SLP (C) No.7248/03
20. The accident in this case took place on 3.1.1991. Twenty persons were travelling in
the truck. The policy covered the risk only of the owner of the goods. Before the learned
Tribunal, it was contended that the risk of the owners of the goods is covered by the
policy. It was held:
"On a careful consideration of the various authorities cited by the learned counsels for
both the parties, Section 147, 149; Rule 277(3) and 252 of Rules framed under M.V. Act I
have no hesitation to conclude that the risk of the owner of the goods is also covered by
the policy issued by the insurance companies, from the evidence of R.W.1 who is no
other than the employee of R-2 as well as terms of Ex.B-2 Policy, it is obvious that the
risk of the owner of the goods is covered, but it is restricted only to one person as owner
of the goods. Thus, there can be no doubt that the owner of the goods can travel in the
goods vehicle and if they are involved in the accident, their risk is covered subject to the
terms and conditions of the policy issued by the insurance companies.
21. The learned Tribunal, however, noticed:
"...Thus, the claim form corroborate the testimony of the petitioners that deceased or the
injured as the case may be travelled in the vehicle as owner of goods. But it is mentioned
in Ex.B-3 claim form as well as in Ex.B1 permit that the seating capacity of the lorry is
only '3' including driver and cleaner which would go to show that only one passenger can
travel in it..."
22. Upon considering the evidences on record, it was held:
"As the permitted seating capacity of the lorry is only '3' including the driver and cleaner
and as only one non-fare paying passenger as owner of goods can travel in the cabin and
as the deceased has admittedly travelled in the cabin beyond seating capacity and
contrary to the terms of the permit as well as Rule 252(2) of the Motor Vehicles Rules. I
am of the view that R-2 cannot be fastened with the liability to pay compensation along
with R-1 to all the injured and legal representatives of deceased. At best it is liable to pay
compensation jointly and severally along with R-1 only in respect of one non-fare paying
passengers, who is the owner of the goods. As per the endorsement I.M.T. 14(b) unless
additional premium is paid for the number of persons who travelled in the lorry, as
owners. I am of the view that R-2 cannot be fastened with liability. Further all the
petitioners and deceased cannot be deemed to have travelled as owners of the paddy as
the paddy is said to be in bags and orally kept in loose in the lorry and it is enough if any
one of them have travelled in the lorry on behalf of all, as owner of the lorry. Rule 277(3)
of A.P. Motor Vehicles Rules, clearly shows that no person shall be carried in the goods
vehicle except as provided in the Rule under the statute and as the only person, who are
permitted to carry in goods vehicles are the owner of hirer or bona fide employee of
owner of hirer and total number of such persons, who could be carried in goods vehicles
is not more than seven including the driver. As per Rule 252(2) person shall be carried in
the cab of the vehicle beyond the seating capacity as per clause (2). No person shall be
carried on the load or otherwise. Rule 4 empowers the R.T.A. to allow large number of
persons to be carried. As the seating capacity of the lorry is only '3' as per Ex.B1 and B3
and as the risk of only owner of goods is covered by Ex.B2 policy, whereas about 40 to
42 persons travelled in the lorry by sitting on the load, which is not permitted and as there
is no material to show that R.T.A. permitted carriage of more than seating capacity but on
the other hand the permit is cancelled. I am in agreement with the contention of the
learned counsel for the respondent that it cannot be fastened with the liability for
compensation."
23

. The High Court, however, dismissed the appeals preferred by the respondents relying
upon Satpal Singh (supra). Submission of the learned counsel appearing on behalf of the
respondent is that within the aforementioned twenty persons, it is the respondents having
preferred an appeal, this Court 1999 AIR SCW 4337

@page-SC490
should hold that at least the claimants-respondents are entitled to compensation as the
deceased was travelling as owner of the goods. The learned Tribunal discussed the matter
in great details. It is not in dispute that premium has been paid only for one person.
24. In the facts and circumstances of this case, we are of the opinion that the contention
of the respondent should be accepted. This appeal is, thus, dismissed.
CA @ SLP (C) Nos.7288-7290/03
25. In this case, the accident took place on 1.5.1997. Indisputably, the respondent was
travelling as a passenger. The Tribunal, while determining the issue as to whether the
accident took place due to rash and negligent driving of the first respondent- driver of
lorry AEW 5199, held:
"...The lorry was overturned and caused the instantaneous death of four passengers. He
received small injuries. He also deposed that the accident took place due to the
negligence of the driver of the said lorry. On perusing his evidence I am satisfied that he
is a truthful witness. He was travelling in the crime vehicle along with deceased along
with his goods as per his evidence..."
26. The learned counsel appearing for the respondent, submitted that from the
aforementioned finding, it is evident that the respondent was travelling as the owner of
the goods. We do not think that the said submission is correct. PW-2, in his evidence,
stated:
"I am doing Tamarind business. I witnessed the accident which took place about 3 years
back at about 6 a.m. at Borrampalem junction beyond Talluru. At the time of the accident
I was in the crime lorry by the side of the driver. Myself and 6 others were carrying
tamarind in that lorry belonging to us. We boarded the lorry along with our load of
tamarind at Dharamavaram to go to Rajanagaram. We were selling the Tamarind at
Rajanagaram in retail by taking the tamarind there in our lorry from our village of
Dharmavaram."
27. The Tribunal, therefore, correctly recorded that according to PW-2, he was travelling
with his goods as owner thereof and not the deceased.
28. Shaik Shabbeer Pasha and Shaik Nazeer Pasha are the Driver and owner respectively
of the lorry which was travelling to Rajahmundry from Visakhapatnam. At Borrampalem,
while trying to overtake another speeding lorry, the same turned turtle. Three persons
who were travelling in the vehicle had been killed. Claim for compensation were filed
before the Motor Accident Claims Tribunal. The appellants therein opposed the claim.
Tribunal awarded compensation to the legal heirs of the deceased.
29

. Challenging the legality of the award of the Tribunal, learned counsel for the appellant
contended that the deceased were gratuitous passengers and the policy did not cover their
lives. Learned counsel also submitted that the decision in Satpal Singh's case (supra)
being referred to a Larger Bench in Asha Rani's case (supra), the same was not a binding
authority. 1999 AIR SCW 4337
2002 AIR SCW 5259

30. While stating that the submissions of learned counsel for insurance company could
not be sustained, the High Court dismissed the appeal of the insurance company
following Satpal Singh (supra).
31. In view of the nature of evidence available before us, we have no other option but to
set aside the judgment. These appeals are, therefore, allowed accordingly. There shall be
no order as to costs in each case.
Order accordingly.
AIR 2008 SUPREME COURT 490 "New India Assurance Co. Ltd. v. Kendra Devi"
(From : Uttaranchal)
Coram : 2 TARUN CHATTERJEE AND P. SATHASIVAM, JJ.
Civil Appeal No. 5067 of 2007 (arising out of SLP (C) No. 7686 of 2006), D/- 31 -10
-2007.
New India Assurance Co. Ltd. v. Kendra Devi and Ors.
Motor Vehicles Act (59 of 1988), S.147 - Constitution of India, Art.133 - MOTOR
VEHICLES - APPEAL - INSURANCE - Liability of insurer - Accident of taxi - Owner
driving it died - Insurance policy covering only risk of paid driver - Considering fact that
deceased was only bread earner of family - S. C. refused to interfere with award. (Para
7)
Cases Referred : Chronological Paras
(2006) 9 SCC 174 (Ref.) 6
Sanjiv Sharma, Harinder Singh, Ms. Manjusha Jha, Arun K. Sinha, Rakesh Singh,
Mukesh Kumar Sinha, for Appellant;
@page-SC491
A. S. Rawat, K. S. Rana, for Respondents.
Judgement
P. SATHASIVAM, J.:-Leave granted.
2. Questioning the orders of the High Court of Uttaranchal at Nainital dated 24.08.2004
in A.O. No. 436 of 2001 and dated 27.10.2005 in R.A. No.8 of 2005, New India
Assurance Company Ltd. through its Regional Manager, New Delhi has filed the above
appeal.

3. Brief facts are as follows: Smt. Kendra Devi, respondent No.1 herein, filed Claim
Petition - M.A.C. No.4 of 1994, before the Motor Accident Claims Tribunal, Uttarkashi,
claiming compensation of Rs.4,67,000/- on account of death of her husband in a motor
vehicle accident. According to respondent No.1 herein, her husband, Prakash Singh
Parmar, was the owner and driver of Taxi No. UMX 491. On 10.11.1993 while her
husband was going from Matali to Uttarkashi, he lost control over the vehicle and met
with an accident due to which the vehicle rolled into the river Bhagirathi near Barrthi.
Her husband sustained fatal injuries in the accident and succumbed to the injuries at the
spot. According to respondent No.1, at the time of the accident her husband was earning
Rs.3000/- per month.
4. Before the Tribunal, the appellant, New India Assurance Co. Ltd. contended that the
vehicle was insured only for five persons whereas it was carrying eight passengers,
therefore, the owner and driver of the vehicle violated the terms and conditions of the
Insurance Policy, in view of the same, they are not liable to pay compensation to the
claimants. The Tribunal, based on the materials before it, after finding that the driver of
the vehicle had valid licence and taking note of the age of the deceased i.e., 50 years, by
applying multiplier of ten, awarded a total compensation of Rs.1,25,000/- along with
interest @ 12%. Aggrieved by the said award, the Insurance Company filed an appeal
before the High Court. The High Court, after finding no infirmity and illegality in the
order passed by the Motor Accident Claims Tribunal, dismissed the appeal and the review
application filed by the Insurance Company was also dismissed. Against the said orders
of the High Court, the New India Assurance Company Ltd. filed the present appeal.
5. Heard learned counsel appearing for the appellant-New India Assurance Company as
well as the respondents-claimants.
6. The only contention of the learned counsel for the appellant-Insurance Company, is
that inasmuch as the insurance policy was issued for paid driver and not for owner who
also happened to drive the vehicle himself at the time of the accident. In support of his
contention, learned counsel drew our attention to the Insurance Policy(Annexure P-3).
Perusal of the Schedule of Premium mentioned in the Insurance Policy, shows that apart
from liability to public risk, the owner has paid premium only for paid driver and/or
conductor. By contending that in the case on hand, the deceased being the owner-cum-
driver and without additional premium/coverage for owner-cum-driver, the insurance
company is not liable to pay any compensation for death of the deceased who was owner-
cum-driver and not paid driver as mentioned in the Schedule of Premium. In support of
his contention, learned counsel for the appellant heavily relied on Section 147 of the
Motor Vehicles Act, 1988 which speaks about the statutory liabilities and a decision of
this Court in New India Assurance Co. Ltd. Vs. Meera Bai and Ors., (2006) 9 SCC 174.
7. We have carefully considered the above provision as well the decision of this Court.
Taking note of the peculiar fact that the claimants have lost their only breadwinner, we
are not inclined to interfere with the concurrent orders of the Tribunal as well as the High
Court. Consequently, the appeal fails and the same is dismissed. No cost.
Appeal dismissed.
AIR 2008 SUPREME COURT 491 "Girja Kumar v. State of H. P."
(From : 2000 AIHC 4274 (H.P.))
Coram : 2 TARUN CHATTERJEE AND P. SATHASIVAM, JJ.
Civil Appeal No. 6616 of 2000, D/- 31 -10 -2007.
Girja Kumar and Ors. v. State of H.P. and Anr.
Specific Relief Act (47 of 1963), S.34 - Limitation Act (36 of 1963), Art.64, Art.65 -
DECLARATION OF TITLE - LIMITATION - ADVERSE POSSESSION - REMAND
OF MATTER - Suit for declaration of title on basis of adverse possession - Plaintiff
claiming possession for 40 years - No defence raised by defendants either before trial
Court or even before High Court that plaintiff was ejected by Settlement Officer and suit
was barred by limitation - Plaintiff claiming that order was passed by
@page-SC492
Settlement Officer without notice and without hearing - No material produced by
defendants that order was validly passed - Dismissal of suit on limitation improper -
Matter remanded. (Para 5)

Himinder Lal, for Appellants; J. S. Attri, for Respondents.


Judgement
1. P. SATHASIVAM, J.:-The plaintiffs who succeeded before the trial Court, lower
appellate Court and lost their suit before the High Court filed the above appeal.
2. Brief facts required for the disposal of this appeal are as follows:
According to the plaintiffs-appellants, they were in possession of the suit land for more
than 40 years. The suit was filed in 1989 for declaration of title on the ground of adverse
possession and for injunction. The trial Court decreed the suit and the appeal filed by the
defendants was dismissed by the first appellate Court. When the second appeal was filed
before the High Court, the High Court, after finding that there is no evidence, remanded
the matter to the trial Court for taking further evidence. The said order of the High Court
was challenged before this Court by way of C.A. No. 1348 of 1999. By judgment dated
8.3.1999, this Court, after recording a finding that the High Court was in error and not
justified in sending the matter back to cure any lacuna in the evidence, set aside the order,
restored Second Appeal No. 304 of 1992 to the file of the High Court and directed it to
dispose of the same afresh on the available evidence.
3. Pursuant to the said direction, the High Court formulated two substantial questions of
law which are as under:
"1. Whether the suit was barred in view of the provisions of Section 163(3) of the H.P.
Land Revenue Act, 1953?
2. Whether the suit of the plaintiff, in the facts of the case that on 2nd April, 1970, an
order of ejectment was passed ordering the ejectment of the plaintiff under Section 163 of
the H.P. Land Revenue Act, 1954, can be said to be within the period of limitation?
While considering the first question, the High Court concluded that inasmuch as an order
of ejectment of the plaintiffs from the land in dispute under Section 163 of the H.P. Land
Revenue Act, 1953 was passed on 2.4.1970 by the Settlement Officer, the suit having
been filed about 19 years after such order is barred by limitation. After arriving at such
conclusion on question No.1, the High Court, without going into the second question or
adverting to the case of the plaintiffs i.e., adverse possession, by order dated 04.01.2000,
allowed the second appeal, set aside the judgments and decrees passed by the trial Court
as well as by the lower appellate Court and dismissed the suit of the plaintiffs as being
time barred. Challenging the said order, the plaintiffs have filed the present appeal.
4. Heard Mr. Himinder Lal, learned counsel appearing for the appellants and Mr. Vivek
Singh Attri, learned counsel appearing for the respondents.
5. We have already extracted the first substantial question of law which relates to
limitation. The High Court proceeded the said issue on the ground that though the order
of ejectment of the plaintiffs from the land in dispute came to be passed by the Settlement
Officer on 2.4.1970 however, the plaintiffs filed the Suit No. 41 of 1989 only on
23.2.1989 before the Senior Sub-Judge, Mandi which was barred by limitation. The High
Court, in arriving at such a conclusion, relied on Section 163 of the H.P. Land Revenue
(Amendment) Act No.15 of 1989. Learned counsel for the respondents herein pointed out
that the order said to have been passed on 2.4.1970 by the Settlement Officer was not
communicated to them. It is also their claim that they were not issued notice or afforded
an opportunity to put forth their case before making an entry/passing an order by the
Settlement Officer. In fact, neither before the Courts below nor before the High Court, the
proceedings dated 2.4.1970 was produced by the defendants. In fact, there is no specific
plea in the written statement as to the limitation and no issue was framed by the trial
Court and no point was determined by the lower appellate Court. We verify the defence
stated in the written statement, issues framed by the trial Court and the points determined
by the lower appellate Court. There is no such plea and issue as to the limitation. Though
it would be open to the parties to the suit to raise the plea of limitation before the High
Court as pointed out earlier, the defendants have not taken any effort to place the alleged
proceedings dated 2.4.1970 of the Settlement Officer. It is not clear how the High Court
arrived at a specific conclusion that suit filed by the plaintiffs was barred by limitation.
Even according to the
@page-SC493
defendants, the entire records relating to the said proceedings were lost. We have already
referred to the fact that such issue was not raised and argued before the Courts below. On
the other hand, the plaintiffs concentrated that they are entitled to decree in respect of the
suit property based on the continuous and uninterrupted possession for over a period of
40 years, that too, to the knowledge of the defendants. In view of the assertion of the
plaintiffs that they were neither heard nor afforded an opportunity in the alleged
proceedings dated 2.4.1970, the onus is on the defendants/Department to place those
relevant record to show that there was valid order by the competent authority. Admittedly,
such record was not called for and no material was placed before the Courts below
including the High Court. On the other hand, based on the acceptable oral and
documentary evidence regarding the claim of adverse possession, the trial Court decreed
the suit which was affirmed by the lower Court. Inasmuch as the High Court dismissed
the suit only on the ground of limitation and not gone into the claim of adverse
possession by plaintiffs, in view of our conclusion and disagreement with the High
Courts decision, we have no other option except to remand the matter once again to the
High Court for disposal of the second appeal afresh in respect of other issue i.e., adverse
possession.
6. Under these circumstances, the judgment and decree dated 4.1.2000 passed by the
High Court of Himachal Pradesh in R.S.A. No. 304 of 1992 is set aside and the matter is
remitted to the High Court to decide the issue relating to adverse possession. However, it
is made clear that except the finding relating to limitation, we have not expressed any
opinion on the conclusion of the courts below relating to the other issues; hence it is for
the High Court to decide the same on merits one way or the other with the available
materials. Inasmuch as the plaintiffs suit is of the year 1989 and even the RSA is of the
year 1992, we request the High Court to dispose of the matter within a period of four
months from the date of receipt of this judgment.
7. The appeal is allowed to the extent mentioned above. No order as to costs.
Order accordingly.
AIR 2008 SUPREME COURT 493 "A. Lewis v. M. T. Ramamurthy"
(From : Karnataka)
Coram : 2 TARUN CHATTERJEE AND P. SATHASIVAM, JJ.
Civil Appeal No. 5066 of 2007 (arising out of SLP (C) No. 19240 of 2006), D/- 31 -10
-2007.
A. Lewis and Anr. v. M. T. Ramamurthy and Ors.
Transfer of Property Act (4 of 1882), S.53A - CONTRACT - DECLARATION OF
TITLE - POSSESSION - Part performance - Benefit of protection under S. 53-A - Not
available to transferee who remains passive - Suit for declaration of title and possession
by purchaser of property - Defendants claiming to have been put in possession in part
performance of earlier agreement for sale - Not intimating their intention to perform their
part of contract - No evidence to show that plaintiff had notice of earlier agreement -
Defendants not entitled to protection of S. 53-A. (Para 6)
S. Balaji, for Appellants; K. K. Mani, C. K. R. Lenin Sekar, K. Narayanan, Mayur R.
Shah, for Respondents.
Judgement
P. SATHASIVAM, J.:-Leave granted.
2. This appeal is directed against the final judgment dated 13.07.2006 passed by the High
Court of Karnataka at Bangalore in R.F.A. Nos. 827 and 718 of 2000 whereby the High
Court dismissed the appeals preferred by the appellants.
BRIEF FACTS:
3. The appellants filed the above appeal seeking declaration of ownership over the suit
property with recovery of possession and mesne profits. The suit property in question is
in respect of two different portions of premises bearing No. 26, Nissan Huts, Austin
Town, Bangalore which originally belonged to Muniyappa, respondent No.3 herein (since
deceased). On 23.12.1982, a registered sale deed was executed by respondent No.3 herein
in favour of respondent No.1. Respondent No.1 issued a notice to respondent No.3 and
the other occupants of the suit property for handing over possession of the suit property.
A reply was sent by counsel on behalf of Defendant No.1 in each suit claiming that the
sale deed pleaded by respondent No. 1 was not genuine and contending that respondent
No.3 had entered into an agreement of sale on 04.10.1982 in respect of the said suit
@page-SC494
property in favour of the appellants herein for a sale consideration of Rs.14,000/-. It was
also stated that an amount of Rs.10,000/- had already been paid as part of sale
consideration and actual possession was also delivered to the said purchasers in part
performance of the agreement to sell. Therefore, Respondent No.1 herein filed two suits
bearing O.S. No. 10607 of 1985 and O.S. No. 10609 of 1985 on the file of the XXVIII
Additional City Civil and Sessions Judge, Mayo Hall at Bangalore claiming that he is the
absolute owner of the suit schedule property and for possession from first defendant,
respondent No.2 herein, along with mesne profits. By common judgment, the learned trial
Judge decreed the suits declaring respondent No.1 herein, as the owner of the suit
schedule property and directed the appellants herein to deliver possession of the suit
property to the plaintiff within six months from the date of the receipt of the order and
also directed that the plaintiff is entitled to mesne profits from 10.7.1985 and a further
direction was also given to initiate an enquiry for determination of mesne profits under
Order XX Rule 12 C.P.C. Challenging the said judgment, defendant Nos. 3 and 4,
appellants herein, filed R.F.A. Nos. 827 and 718 of 2000 and defendant No.2, respondent
No.3 herein, filed R.F.A. Nos. 730 and 830 of 2000 before the High Court. The High
Court dismissed all the four appeals with costs and directed defendant Nos. 1, 3 and 4 to
hand over vacant possession of the suit property within six months. Aggrieved by the
judgment in R.F.A. Nos. 827 and 718 of 2000, this appeal has been preferred by way of
special leave before this Court.
4. We heard Mr. S. Balaji, learned counsel for the appellants and Mr. K.K. Mani, learned
counsel for the respondents and perused all the relevant materials and records filed in this
Court.
5. Learned counsel for the appellants mainly contended that the High Court committed an
error in dismissing their appeals on the ground that Ex.D-1 Agreement to sell dated
04.10.1982 is antedated. According to him, in view of the fact that it was not the case of
the contesting respondents herein, the High Court ought not to have reversed the finding
of the fact in the appeal. On the other hand, learned counsel appearing for the contesting
respondents, after taking us through the entire materials including the pleadings of both
the parties, conclusion of the trial Judge and the decision arrived at by the High Court,
submitted that there is no valid ground for interference. In view of the assertion of the
counsel for the appellants, we have carefully perused the judgment of the High Court as
well as the other materials. It is true that the High Court in para 21 of its judgment has
concluded "considering these factors, I am of the opinion that this document, Ex.D-1
must have come into existence subsequent to the sale deed to defeat the rights of the
plaintiff and, therefore, Additional issue No.5 in each case has to be answered in the
negative." First of all, there is no specific finding either by the trial Court or by the High
Court to the effect that Ex.D-1 Agreement to sell is antedated. On the other hand, the trial
Court as well as the High Court considered the claim of the plaintiffs based on Ex.P-1
dated 23.12.1982 as well as the defence of the contesting defendants based on agreement
of sale dated 04.10.1982.
6. As rightly pointed out by the High Court, the existence of right to claim protection
under Section 53-A of the Transfer of Property Act would not be available if the
transferee just kept quiet and remained passive without taking effective steps. Further, he
must also perform his part of the contract and convey his willingness. On the other hand,
the factual finding is that there was no intimation by defendant Nos. 3 and 4 to perform
their part of contract to claim protection of Section 53-A of the Transfer of Property Act.
Likewise, as rightly concluded by the courts below, there is no material to show that the
plaintiff had notice of agreement of sale Ex.D-1 in favour of defendant Nos. 3 and 4. The
conclusion of the High Court that defendant Nos. 3 and 4 or even defendant No.1 who
claims through them are not entitled to protection of Section 53-A of the Transfer of
Property Act is acceptable and the argument contrary to the said conclusion is liable to be
rejected.
7. As rightly pointed out, the sale deed executed by the second defendant in favour of the
plaintiff is not only a registered document but the plaintiff apart from offering his
evidence, has also examined the scribe of the document and both the courts below rightly
found that Ex.P-1 has been proved in accordance with law. It is not in dispute that Ex.D-1
is an unregistered document. It is also not in dispute that the said document has not been
produced until
@page-SC495
defendant Nos. 3 and 4 were impleaded. Considering the evidence and of the claim that
second defendant was in need of money for discharging his antecedent debts and for
family maintenance etc., both the Courts disbelieved his version and rightly concluded it
was highly doubtful that the agreement of sale had been executed by him prior to the sale
deed. Only after analyzing all the above-mentioned material aspects, the High Court has
rightly concluded that Ex.D-1 must have come into existence subsequent to the sale deed
in order to defeat the rights of the plaintiff. If the High Court dismissed the appeal based
on the only reason as argued by learned counsel for the appellants, it would be
appropriate to remit it to the High Court for fresh disposal on all aspects. However, as
observed earlier, the High Court as the first appellate court analyzed the entire evidence
and concluded that the plaintiff had proved that the sale deed had been executed in his
favour by Defendant No.2 under Ex.P-1, consequently confirmed the decision of the trial
Court in decreeing the suits as prayed for. We are in entire agreement with the said
conclusion and unable to accept the argument of learned counsel for the appellants.
8. In the light of the above discussion, the appeal fails and is dismissed. No costs.
Appeal dismissed.
AIR 2008 SUPREME COURT 495 "People's Union For Civil Liberties v. Union of
India"
Coram : 2 Dr. A. PASAYAT AND S. H. KAPADIA, JJ.
I. A. Nos. 34, 35, 37, 40, 49, 54, 58-62, 77 in W. P. (C) No. 1966 of 2001, D/- 20 -11
-2007.
People's Union For Civil Liberties v. Union of India and Ors.
Maternity Benefit Act (53 of 1961), S.28 - MATERNITY BENEFIT - SUPREME
COURT - EQUALITY IN PUBLIC EMPLOYMENT - National Maternity Benefit
Scheme - Modification of and introduction of new Scheme called Janani Suraksha Yojna
- Centre providing 100% funds - Some States not utilising such funds to fullest extent -
Supreme Court directed Central Govt. to ensure that such funds is not utilised for any
other purpose etc. - Central Govt. directed to make amendments to ensure that benefit of
scheme is not given against concept of family planning and to mothers who have married
despite being below prohibited age.
Constitution of India, Art.16. (Paras 14, 15)

Mohan Parasaran, ASG, Mrs. Jayshree Anand, Addl. AG, Colin Gonsalves, T. S. Doabia,
Jaideep Gupta, Anil Diwan, Sr. Advocates, Vipin M. Benjamin, Jai Singh, Ms. Jyoti
Mendiratta, J. S. Attri, Vivek Singh Attri, D. S. Mahra, Ms. Sushma Suri, B. K. Sood, R.
C. Kathia, Kh. Nobin Singh, Tarun Jamwal, Dr. Kailash Chand, Venkateshwara Rao
Anumolu, Ravindra Keshavrao Adsure, Gautam Godara, K. K. Mahalik, Ms. Sunita
Sharma, Jana Kalyan Das, Ms. Hemantika Wahi, Ms. Shivangi, B. V. Balaram Das, Ms.
Indra Sawhney, Aruneshwar Gupta, Naveen Kumar Singh, Shashwat Gupta, Riku Sarma
(for M/s. Corporate Law Group), Ms. Rachana Srivastava, S. V. Deshpande, Manoj
Saxena, Rajnish Kr. Singh, Rahul Shukla, T. V. George, Ms. Kamini Jaiswal, Ranjan
Mukherjee, S. C. Ghosh, V. G. Pragasam, S. Joseph Aristotle, S. Prabu
Ramasubramanian, Jatinder Kumar Bhatia, Ravi Prakash Mehrotra, Gopal Singh, B. S.
Banthia, Tara Chandra Sharma, Ms. Neelam Sharma, B. B. Singh, Kumar Rajesh Singh,
Anil Shrivastava, Ritu Raj, Gopal Prasad, Prakash Shrivastava, Ramesh Babu M. R., Mrs.
D. Bharathi Reddy, Amit Kr. Chawla, Sanjay R. Hegde, U. Hazarika, Satya Mitra, Ms.
Sumita Hazarika, R. K. Maheshwari, Ms. A. Subhashini, Uday B. Dube, Kuldip Singh,
Prashant Kumar, Vishwajit Singh, Anis Suhrawardy, Ashok Bhan, S. W. A. Qadri, Jubair
Ahmed Khan, K. V. Mohan, Manish Sharma, Ms. Suparna Srivastava, Ms. Nidhi
Minocha, Rajesh Srivastava, Anuvrat Sharma, K. N. Madhusoodhanan, R. Sathish, R. C.
Kaushik, Pradeep Misra, G. Prakash, Ms. Malvika Trivedi, Anil Kumar Jha, Gopal Singh,
Sib Shankar Mishra, A. Mariarputham, Mrs. Aruna Mathur (for Arputham Aruna and
Co.), for appearing parties.
Judgement
1. Dr. ARIJIT PASAYAT, J. :-By this order two IAs. No.37 of 2004 and No.54 of 2005
stand disposed of. IA No.37 of 2004 is an application by the Union of India for
permission to modify the National Maternity Benefit Scheme (in short NMBS) and to
introduce a new scheme called the Janani Suraksha Yojana (in short JSY). IA No.54 of
2005 is an application by the petitioner questioning legality of the discontinuation of the
benefit under the NMBS due to introduction of JSY. By order dated 27.4.2004 this Court
directed as follows:
@page-SC496
"No Scheme...in particular........... National Maternity Benefit Scheme shall be
discontinued or restricted in any way without prior approval of the Court."
2. Again by order dated 9.5.2005 this Court directed as follows:
"By LA 37, permission is sought to modify The National Maternity Benefit Scheme
(NMBC) and to introduce a new scheme namely Janani Suraksha Yojana (JSY). Whereas
in IA 54, the prayer is that the Scheme should not be modified by reducing, abridging or
qualifying in any way the social assistance entitlements created under the original scheme
of NMBS for expecting BPL mothers, including rash entitlement of Rs.500/- provided
therein. We have requested learned Additional Solicitor General to place on record further
material in the form of affidavit to effectively implement the new Scheme sought to be
introduced. The further material shall include the approximate distance of Public Health
Centre from the residential complexes and the facility of transportation etc. The
Commissioner shall also examine the matter in depth and file a report. The response to
the application may be filed within eight weeks. Meanwhile, the existing National
Maternity Benefit Scheme will continue."
3. The Government set a numerical ceiling of 57.5 lakh beneficiaries as the annual target
for NMBS. However, the number of beneficiaries under JSY in 2006-07 was only 26.2
lakh i.e. 45.5% and in the year 2005-06 this was as low as 5.7 lakh i.e. 10%. While there
has been an improvement in the last one year, the coverage under this scheme is still way
below the target number of women to be covered by the NMBS.
4. According to the Union of India the JSY was introduced to put a premium on the
willingness of poor women to go in for institutional delivery instead of home delivery.
But it was recognized that in States with lower institutional delivery rates, one of the
reasons for low performance have been lesser availabilities of facilities in the Health
Centres, which act as disincentive for the poor illiterate women to seek the services.
5. Pursuant to the order of this Court dated 9.5.2005 the Commissioner had prepared a
report.
6. After discussions with the Commissioner appointed by this Court, senior officials, the
Central Government took a decision to modify the JSY Scheme to continue benefits of
NMBS and also to improve upon such benefits for non-institutional delivery, where the
woman chooses to deliver her baby at home. In this connection, a letter dated 13.7.2006
was written to the Commissioner by the Secretary, Health and Family Welfare under the
amended JSY. The Low Performing States and High Performing States were defined as
follows:
"4.1 The scheme focuses on the poor pregnant woman with special dispensation for
States having low institutional delivery rates namely the States of Uttar Pradesh,
Uttaranchal, Bihar, Jharkhand, Madhya Pradesh, Chhattisgarh, Assam, Rajasthan, Orissa
and Jammu and Kashmir. While these States have been named as Low Performing States
(LPS), the remaining States have been named as High Performing States (HPS)."
7. The table below gives details of the number of beneficiaries under JSY (all these would
have received Rs.500/- under NMBS irrespective of place of delivery) vis-a-vis the
annual targets set by the Government of India for NMBS.
Percentage of Eligible Beneficiaries Covered Under NMBS

@page-SC497

8. The scheme as the details above go to show has virtually not taken off in many States.
Delhi has given the benefit under the NMBS to only 20 women in 2006-07, while in
Chandigarh the number of beneficiaries is 0. In Sikkim, Meghalaya, Himachal Pradesh,
Uttar Pradesh, Haryana and Dadra and Nagar Haveli less than even 10% of the eligible
beneficiaries have been covered under the NMBS. Except for the States of Andhra
Pradesh, Jammu and Kashmir, Rajasthan, Madhya Pradesh, Assam, Orissa and Mizoram
where more than 75% of the eligible beneficiaries seem to have been reached out to, the
performance of this scheme has been very poor in all other States.
Indicated below are percentage of Home delivery figures
@page-SC498

9. In the States of Madhya Pradesh, Haryana, Manipur and Delhi there are almost no JSY
beneficiaries who had a home delivery. This indicates that in these States the scheme's
focus continues to be only on institutional deliveries and not all deliveries. Even in the
States of Assam, Rajasthan, Meghalaya, Orissa and Chhattisgarh the JSY has been
disproportionately given to only those who have had institutional deliveries.
10. At this juncture, the financial performance needs to be noted.
11. The Janani Suraksha Yojana is a centrally-sponsored scheme with the Centre
providing 100% of the funds. Some States e.g. Andhra Pradesh make their own
contribution thereby increasing the amount of cash assistance for institutional deliveries.
Tamil Nadu has introduced a separate scheme for providing mothers with Rs.1000/? per
month for six months i.e. three months prior to the delivery and three months after. Given
below are the details of allocation and utilization of the funds provided by the Central
Government.
12. Out of the funds provided for JSY for 2006-07, about 71.2% of the funds allocated
have been utilized in the year 2006-07.
Utilization of funds allocated by JSY

13. Looking at the State-wise break-up it is seen that States like Delhi, Nagaland and
Arunachal Pradesh, and Union Territories of Chandigarh and Daman and Diu have not at
all utilized the funds allocated to them for the purpose of JSY. Among other States,
Manipur, Jharkhand and Haryana utilized less than 20% of the funds released to them.
Only 10 States spent more than 70% of the funds allocated to them under JSY.
14. At the time of hearing of the applications, learned counsel for the petitioner and the
Union of India highlighted various
@page-SC499
aspects. Considering the submissions and the material data placed on record we direct as
follows:-
(a) The Union of India and all the State Governments and the Union Territories shall (i)
continue with the NMBS and (ii) ensure
@page-SC500
that all BPL pregnant women get cash assistance 8-12 weeks prior to the delivery.
(b) The amount shall be Rs.500/- per birth irrespective of number of children and the age
of the woman.
(c) The Union of India, State Governments and the Union Territories shall file affidavits
within 8 weeks from today indicating the total number of births in the State, number of
eligible BPL women who have received the benefits, number of BPL women who had
home/non-institutional deliveries and have received the benefit, number of BPL women
who had institutional deliveries and have received the benefit.
(d) The total number of resources allocated and utilized for the period 2000-2006.
(e) All concerned Governments are directed to regularly advertise the revised scheme so
that the intended beneficiaries can become aware of the scheme.
(f) The Central Government shall ensure that the money earmarked for the scheme is not
utilized for any other purpose. The mere insistence on utilization certificate may not yield
the expected result.
(g) It shall be the duty of all the concerned to ensure that the benefits of the scheme reach
the intended beneficiaries. In case it is noticed that there is any diversion of the funds
allocated for the scheme, such stringent action as is called for shall be taken against the
erring officials responsible for diversion of the funds.
15. At this juncture it would be necessary to take note of certain connected issues which
have relevance. It seems from the scheme that irrespective of number of children, the
beneficiaries are given the benefit. This in a way goes against the concept of family
planning which is intended to curb the population growth. Further the age of the mother
is a relevant factor because women below a particular age are prohibited from legally
getting married. The Union of India shall consider this aspect while considering the
desirability of the continuation of the scheme in the present form. After considering the
aforesaid aspects and if need be, necessary amendments may be made.
16. The IAs are accordingly disposed of.
Order accordingly.
AIR 2008 SUPREME COURT 500 "Santosh v. Saraswathibai"
(From : AIR 2006 Karnataka 85)
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Civil Appeal No. 5321 of 2007 (arising out of S.L.P. (C) No. 5437 of 2006), D/- 20 -11
-2007.
Santosh and Ors. v. Saraswathibai and Anr.
Hindu Succession Act (30 of 1956), S.14(1) - SUCCESSION - POSSESSION -
Enlargement of estate of female Hindu - Property given to wife by her deceased-husband
for maintenance - Her possession to suit property accepted by defendants, other heir of
deceased in consent decree passed in previous suit - Pre-existing right of wife for
maintenance getting thus crystallised by consent decree - She cannot be divested of her
absolute ownership by invoking S. 14(2). (Paras 13, 17)
Cases Referred : Chronological Paras
2006 (13) Scale 408 12
2005 AIR SCW 2203 12
1996 AIR SCW 229 : AIR 1996 SC 855 (Foll.) 16
1995 AIR SCW 3885 : AIR 1996 SC 172 16
AIR 1977 SC 1944 (Foll.) 15, 16
AIR 1959 SC 577 (Rel. on) 9, 12
AIR 1957 Cal 557 12
C. G. Solshe and Vinesh Solshe, for Appellants; Basava Prabhu S. Patil, V. N.
Raghupathy, B.Subrahmanya Prasad, Narayan P. Kengasur and B. B. Patil, for
Respondents.
Judgement
1. S. B. SINHA, J. :-Leave granted
2

. Application of Section 14(1) of the Hindu Succession Act, 1956 (hereinafter referred to
as 'the Act') calls for consideration in this appeal which arises out of a judgment and order
dated 15th November, 2005 passed by a learned Single Judge of the Karnataka High
Court at Bangalore in Regular Second Appeal No. 276 of 2003. Reported in AIR 2006
Kant 85

3. The short factual matrix involved may be noticed at the threshold.


4. For the said purpose, we may notice the genealogy of the family.

5. Original Suit bearing No. 34 of 1964 was filed by Sundrabai, first wife of Trimukhrao
(respondent No.1 herein) against Mallikarjun (since deceased) and Kashibai (defendant
No.4 therein). A
@page-SC501
consent decree was passed in that suit, the relevant clauses whereof were as under :-
"1. The plaintiff and the defendant No.2 are the wives of deceased Trimbakrao. The
defendant No.1 is the son of Trimbakrao. The plaintiff Sundrabai and Mallikarjun and his
mother Kashibai resides separately.
2. That as per compromise the land Sy. No.73 Kh. No.145 to the extent of measuring 6
acres 33 guntas. R.A. Rs.9.00 situated at Khandala, on north side bounded in the east the
land of Shivalingappa Biradar in the west public way. In the north the land of
Shankarappa in the south remain land Sy. No.73, was given to the plaintiff for her
maintenance. She is in possession of that portion of land since 5/6 years. The defendants
will not interfere and obstruct in the peaceful possession of that portion of land which
was given to the plaintiff for her maintenance, till her death. The defendant Nos.1 and 2
will remain in possession of remaining half portion of land Sy.No.73 on south side as
owner. The plaintiff will not alienate (through gift or sale) land which was given for her
maintenance.
3. That after the death of the plaintiff the land given to her will be reversed to the
defendant Nos.1 and 2. The parties will bear their costs of the cost.""
6. Mallikarjun died in the year 1987. Sundrabai died in 1992. Respondents herein who
are heirs and legal representatives of Sundrabai filed Original Suit No.210 of 1993
claiming the said land admeasuring 6 Acres 33 guntas from the Northern side of Survey
No. 73 on the ground that she had become owner thereof in terms of Section 14(1) of the
Act. Appellants who were arrayed in the suit as defendants inter alia contended that
Sundrabai was not the absolute owner of the said property having been allotted to her by
reason of the consent decree. It was furthermore contended that the land in suit was
allotted to her by way of maintenance which she could keep in possession only during her
lifetime and, therefore, Section 14(2) of the Act and not Section 14(1) of the Act would
apply.
7. The said suit was dismissed on the premise that the plaintiffs were not the owners and
were not in possession of the suit property.
8. On an appeal having been preferred thereagainst, the Principal District Judge Bidar by
his judgment and order dated 2nd January, 2003 allowed the said appeal opining that
Section 14(1) of the Act being
@page-SC502
applicable, the plaintiffs became the owners of the suit property. By reason of the
impugned judgment the second appeal preferred by the appellants has been dismissed.
9

. Mr. Solashe, learned counsel appearing on behalf of the appellants, in support of this
appeal inter alia would submit that the High Court committed a serious error of law in so
far as it failed to take into consideration that Sundrabai on partition could not have been
allotted 6 Acres 33 guntas of land and in that view of the matter, although the land which
could fall in her share would be covered by Section 14(1) of the Act, but according to the
learned counsel the share of Sundrabai in the joint family being 7/24 in the total land of
joint family being 12 acres 33 guntas, share of Sundrabai would come only to 3 acres 29
guntas. It was submitted that the word "possessed" contained in Section 14 (1) of the Act
must be construed to mean ownership as has been held by this Court in [1959] Supp 1
SCR 968, Gummala-pura Taggina Matada Kotturuswami vs. Setra Veeravva and others.
AIR 1959 SC 577

10. Mr. Patil, learned counsel appearing on behalf of the respondents, on the other hand,
would support the judgment. It was moreover contended that there is nothing on record to
show that the total agricultural lands belonging to the joint family was only to the extent
of 12 acres 33 guntas. In fact, Mr. Patil would urge that there were other properties of the
joint family besides, the suit land.
11. Sub-sections (1) and (2) of Section 14 of the Act reads as under:-
"14. Property of a female Hindu to be her absolute property- (1) Any property possessed
by a female Hindu, whether acquired before or after the commencement of this Act, shall
be held by her as full owner thereof and not as a limited owner.
Explanation.- In this sub-section, property includes both movable and immovable
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 the marriage, or by her own skill or exertion, or by purchase or
by prescription, or in any other manner whatsoever, and also any 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."
12
. In Gummalapura Taggina Matada (supra) on which reliance has been placed by the
learned counsel, this Court held that Section 14(1) of the Act has wide application. It not
only takes within its sweep a land which was not only in possession of the female Hindu
but also covers the land over which she has a right to possess stating:-- AIR 1959 SC
577, Para 11

"Of course, possession referred to in section 14 need not be actual physical possession or
personal occupation of the property by the Hindu female but may be possession in law.
The possession of a licensee, lessee or a mortgagee from the female owner or the
possession of a guardian or a trustee or an agent of the female owner would be her
possession for the purpose of section 14. The word "possessed" is used in section 14 in a
broad sense and in the context possession means the state of owning or having in one's
hands or power. It includes possession by receipt of rents and profits. The learned Judges
expressed the view that even if a trespasser were in possession of the land belonging to a
female owner, it might conceivably be regarded as being in possession of the female
owner, provided the trespasser had not perfected his title. We do not think that it is
necessary in the present case to go to the extent to which the learned Judges went. It is
sufficient to say that "possessed" in section 14 is used in a broad sense and in the context
means the state of owning or having in one's hand or power. In the case of Gostha Behari
v. Haridas Samanta, P. N. Mookherjee, J., expressed his opinion as to the meaning of the
words "any property possessed by a female Hindu" in the following words :- AIR
1957 Cal 557 at P. 559

"The opening words in "property possessed by a female Hindu" obviously mean that to
come within the purview of the section the property must be in possession of the female
concerned at the date of the commencement of the Act. They clearly contemplate the
female's possession when the Act came into force. That possession might have
@page-SC503
been either actual or constructive or in any form recognised by law, but unless the female
Hindu, whose limited estate in the disputed property is claimed to have been transformed
into absolute estate under this particular section, was at least in such possession, taking
the word "possession" in its widest connotation, when the Act came into force, the section
would not apply."

(See also (2005) 5 SCC 390, Shakuntla Devi vs. Kamla and others and 2006 (13) SCALE
408, Chandrika Singh (D) by L.Rs. vs. Sarjug Singh and another. 2005 AIR SCW 2203

13. Sundrabai's possession in respect of 6 acres 33 guntas of land even prior to the
institution of the suit has been accepted in the said consent decree. Appellants herein
undertook not to interfere in her peaceful possession thereover. Admittedly after the death
of Trimukhrao who died after coming into force of the Act, Sundrabai became one of the
co-owners of the property being one of his wives who had half share in the joint
properties. Succession thereof was governed by Sections 6, 8 and 12 of the Act. It is,
therefore, not a case where she had no right to possess the said land. If she had a right to
possess the said land as a co-owner, the question of divesting her of the said right by
invoking sub-section (2) of Section 14 of the Act would not arise.
14. The stipulations made in the consent decree dated 20th July, 1964 must thus be
construed having regard to the well settled legal position. It is now a well settled principle
of law that in considering a deed, the legal position obtaining in this behalf should be
kept in mind.
15

. Legal position in regard to the right of a female Hindu was laid down by this Court in
(1977) 3 SCC 99, V. Tulasamma and others vs. Sesha Reddy (dead) by L.Rs., wherein
the legal consequences were summarized as under :-AIR 1977 SC 1944

"(1) The Hindu female's right to maintenance is not an empty formality or an illusory
claim being conceded as a matter of grace and generosity, but is a tangible right against
property which flows from the spiritual relationship between the husband and the wife
and is recognised and enjoined by pure Shastric Hindu Law and has been strongly
stressed even by the earlier Hindu jurists starting from Yajnavalkya to Manu. Such a right
may not be a right to property but it is a right against property and the husband has a
personal obligation to maintain his wife and if he or the family has property, the female
has the legal right to be maintained therefrom. If a charge is created for the maintenance
of a female, the said right becomes a legally enforceable one. At any rate, even without a
charge the claim for maintenance is doubtless a pre-existing right so that any transfer
declaring or recognising such a right does not confer any new title but merely endorses or
confirms the pre-existing rights.
(2) Section 14(1) and the Explanation thereto have been couched in the widest possible
terms and must be liberally construed in favour of the females so as to advance the object
of the 1956 Act and promote the socio-economic ends sought to be achieved by this long
needed legislation.
(3) Sub-section (2) of Section 14 is in the nature of a proviso and has a field of its own
without interfering with the operation of Section 14(1) materially. The proviso should not
be construed in a manner so as to destroy the effect of the main provision or the
protection granted by Section 14(1) or in a way so as to become totally inconsistent with
the main provision.
(4) Sub-section (2) of Section 14 applies to instruments, decrees, awards, gifts, etc. which
create independent and new titles in favour of the females for the first time and has no
application where the instrument concerned merely seeks to confirm, endorse, declare or
recognise pre-existing rights. In such cases a restricted estate in favour of a female is
legally permissible and Section 14(1) will not operate in this sphere. Where, however, an
instrument merely declares or recognises a pre-existing right, such as a claim to
maintenance or partition or share to which the female is entitled, the sub-section has
absolutely no application and the females limited interest would automatically be
enlarged into an absolute one by force of Section 14(1) and the restrictions placed, if any,
under the document would have to be ignored. Thus where a property is allotted or
transferred to a female in lieu of maintenance or a share at partition, the instrument is
taken out of the ambit of sub-section (2) and would be governed by Section 14(1) despite
any restrictions placed on the powers of the transferee.
(5) The use of express terms like
@page-SC504
'property acquired by a female Hindu at a partition', 'or in lieu of maintenance', or 'arrears
of maintenance', etc. in the Explanation to Section 14(1) clearly makes sub-section (2)
inapplicable to these categories which have been expressly excepted from the operation
of sub-section (2).
(6) The words 'possessed by' used by the Legislature in Section 14(1) are of the widest
possible amplitude and include the state of owning a property even though the owner is
not in actual or physical possession of the same. Thus, where a widow gets a share in the
property under a preliminary decree before or at the time when the 1956 Act had been
passed but had not been given actual possession under a final decree, the property would
be deemed to be possessed by her and by force of Section 14(1) she would get absolute
interest in the property. It is equally well settled that the possession of the widow,
however, must be under some vestige of a claim, right or title, because the section does
not contemplate the possession of any rank trespasser without any right or title.
(7) That the words 'restricted estate' used in Section 14(2) are wider than limited interest
as indicated in Section 14(1) and they include not only limited interest, but also any other
kind of limitation that may be placed on the transferee."
16

. In Nazar Singh and others vs. Jagjit Kaur and others : (1996) 1 SCC 35, this Court
following Tulasamma (supra) held as under :- 1996 AIR SCW 229, Para 8
AIR 1977 SC 1944

"The principles enunciated in this decision have been reiterated in a number of decisions
later but have never been departed from. According to this decision, sub-section (2) is
confined to cases where property is acquired by a female Hindu for the first time as a
grant without any pre-existing right under a gift, will, instrument, decree, order or award,
the terms of which prescribe a restricted estate in the property. It has also been held that
where the property is acquired by a Hindu female in lieu of right of maintenance inter
alia, it is in virtue of a pre-existing right and such an acquisition would not be within the
scope and ambit of sub-section (2) even if the instrument, decree, order or award allotting
the property to her prescribes a restricted estate in the property. Applying this principle, it
must be held that the suit lands, which were given to Harmel Kaur by Gurdial Singh in
lieu of her maintenance, were held by Harmel Kaur as full owner thereof and not as a
limited owner notwithstanding the several restrictive covenants accompanying the grant.
(Also see the recent decision of this Court in Mangat Mal v. Punni Devi, where a right to
residence in a house property was held to attract sub-section (1) of Section 14
notwithstanding the fact that the grant expressly conferred only a limited estate upon her.)
According to sub-section (1), where any property is given to a female Hindu in lieu of her
maintenance before the commencement of the Hindu Succession Act, such property
becomes the absolute property of such female Hindu on the commencement of the Act
provided the said property was "possessed" by her. Where, however, the property is given
to a female Hindu towards her maintenance after the commencement of the Act, she
becomes the absolute owner thereof the moment she is placed in possession of the said
property (unless, of course, she is already in possession) notwithstanding the limitations
and restrictions contained in the instrument, grant or award whereunder the property is
given to her. This proposition follows from the words in sub-section (1), which insofar as
is relevant read : "Any property possessed by a female Hindu....after the commencement
of this Act shall be held by her as full owner and not as a limited owner". In other words,
though the instrument, grant, award or deed creates a limited estate or a restricted estate,
as the case may be, it stands transformed into an absolute estate provided such property is
given to a female Hindu in lieu of maintenance and is placed in her possession. So far as
the expression "possessed" is concerned, it too has been the subject-matter of
interpretation by several decisions of this Court to which it is not necessary to refer for
the purpose of this case. 1995 AIR SCW 3885

(Emphasis supplied)
17. In view of the aforementioned binding authoritative pronouncements of this Court,
we are of the opinion that the pre-existing right of Sundrabai was crystallized by reason
of the said consent decree. Furthermore there is nothing on record to show that 12 acres
33 guntas of land was the only property belonging to the joint family and thus, she had
been granted more lands to which she was not entitled to.
18. In view of the matter, we do not find
@page-SC505
any infirmity in the impugned judgment. The appeal is accordingly dismissed with costs.
Counsels fees assessed at Rs.10,000/-.
Appeal dismissed.
AIR 2008 SUPREME COURT 505 "D. Sailu v. State of Andhra Pradesh"
(From : Andhra Pradesh)*
Coram : 2 Dr. A. PASAYAT AND AFTAB ALAM, JJ.
Criminal Appeal No. 1592 of 2007(arising out of SLP (Cri.) No. 3627 of 2006), D/- 20
-11 -2007.
D. Sailu v. State of A.P.
(A) Evidence Act (1 of 1872), S.3 - EVIDENCE - WITNESS - Interested witness -
Testimony of - Reliability - Relationship is not a factor to affect credibility of a witness -
It is more often than not that a relation would not conceal actual culprit and make
allegations against an innocent person - Plea that witness being a close relative and
partisan witness should not be relied upon - Is, therefore, untenable.
2002 AIR SCW 4271; 2004 AIR SCW 7376; 2007 (1) SCC 699; AIR 1953 SC 364; AIR
1974 SC 276; AIR 1957 SC 614; AIR 1965 SC 202; AIR 1973 SC 2407; 2002 (3) SCC
76, Relied on. (Paras 11, 14)
(B) Evidence Act (1 of 1872), S.60, S.45 - EVIDENCE - WITNESS - Ocular evidence
vis-a-vis medical evidence - Evaluation of - Medical evidence at variance with ocular
evidence - It would be erroneous to accord undue primacy to hypothetical answers of
medical witnesses to exclude eye-witnesses' account which has to be tested
independently.
2003 AIR SCW 3688, Relied on. (Para 19)
(C) Penal Code (45 of 1860), S.300, Exception 1 and Exception 4 - MURDER - Murder
or culpable homicide - Distinction between First and Fourth Exception to S. 300, stated.
The Fourth Exception to Section 300, IPC covers acts done in a sudden fight. The said
Exception deals with a case of prosecution not covered by the First Exception, after
which its place would have been more appropriate. The Exception is founded upon the
same principle, for, in both there is absence of premeditation. But, while in the case of
Exception 1 there is total deprivation of self-control, in case of Exception 4, there is only
that heat of passion which clouds men's sober reason and urges them to deeds which they
would not otherwise do. There is provocation in Exception 4 as in Exception 1; but the
injury done is not the direct consequence of that provocation. For the application of
Exception 4, it is not sufficient to show that there was a sudden quarrel and that there was
no premeditation. It must further be shown that the offender has not taken undue
advantage or acted in cruel or unusual manner. The expression "undue advantage" as used
in the provision means "unfair advantage".
2006 AIR SCW 1678, Relied on.
(Para 26)
(D) Penal Code (45 of 1860), S.300, S.304, Part I - MURDER - CULPABLE
HOMICIDE - Murder or culpable homicide - Proof - Sudden quarrel - Accused allegedly
stabbed deceased with knife - There was evidence of eye-witnesses - Medical evidence
was not contrary to ocular evidence as claimed - Doctor had clearly stated as to under
what circumstances lacerated injury can be caused by knife - Occurrence took place in
course of sudden quarrel and verbal altercation - Conviction of accused under S. 300,
therefore, altered to one under S. 304, Part I.
Cri. A. No. 287 of 2003, D/- 15-7-2005 (A. P.), Reversed. (Paras 22, 28)
Cases Referred : Chronological Paras
(2007) 1 SCC 699 (Rel. on) 17
2006 AIR SCW 1678 : 2006 Cri LJ 2111 (Rel. on) 27
2004 AIR SCW 7376 : AIR 2005 SC 1460 (Rel. on) 17
2003 AIR SCW 3688 : AIR 2003 SC 2978 : 2003 Cri LJ 3705 (Rel. on) 21
2002 AIR SCW 4271 : AIR 2002 SC 3633 : 2003 Cri LJ 41 (Rel. on) 6
(2002) 3 SCC 76 (Rel. on) 16
AIR 1974 SC 276 : 1974 Cri LJ 331 (Rel. on) 13
AIR 1973 SC 2407 : 1973 Cri LJ 1589 (Rel. on) 16
AIR 1965 SC 202 : 1965 (1) Cri LJ 226 (Rel. on) 15
AIR 1957 SC 614 : 1957 Cri LJ 1000 (Rel. on) 13
AIR 1953 SC 364 (Rel. on) 12, 14
AIR 1952 SC 54 : 1952 Cri LJ 547 14
@page-SC506

Ajay Sharma, for Appellant; Mrs. D. Bharathi Reddy, for Respondent.


* Cri. A. No. 287 of 2003, D/- 15-7-2005 (A. P.)
Judgement
1. Dr. ARIJIT PASAYAT, J.:- Leave granted.
2. Challenge in this appeal is to the order passed by a Division Bench of the Andhra
Pradesh High Court upholding the conviction of the appellant (hereinafter referred to as
'Accused No.1') for offence punishable under Section 302 of the Indian Penal Code, 1860
(in short the 'IPC') and sentence of imprisonment for life and fine of Rs.200/- with default
stipulation.
3. Background facts as projected by the prosecution are as follows:
Accused persons D. Sailu, Ramaiah, D. Pentamma and Yadaiah are described as A-1, A-
2, A-3 and A-4. Samuel (hereinafter referred to as the deceased) was the husband of
Shantamma (P.W.1). A-1 is the son of the elder brother of the deceased, A-2 is the father
of A-1, A-3 is the wife of A-2 and A-4 is the younger brother of A?1. The deceased and
the accused were not on good terms as they quarrelled with each other over bore water
for the fields. Fifteen days prior to the date of incident, the accused and the deceased
quarrelled with each other. On the date of incident i.e. 24.11.1999 at about 8.00 p.m., A-1
asked the deceased as to why he (deceased) scolded the mother of A-1. The deceased told
him that he did not scold his mother. Then P.W.1, the wife of the deceased, caught hold of
the hands of A-1. A-4, the younger brother of A-1, came and attempted to beat the
deceased. P.W.1 pushed the younger brother of A-1. A-2 beat P.W.1 with hands and A-1
stabbed the deceased at the instigation of A-2 with a knife on the left side of the stomach.
As a result, the deceased fell down. A-3 also came there along with A-2 and beat P.W.1.
Thereafter, the deceased was taken to the Sangareddy Hospital in an auto.
4. The Village Administrative Officer gave Ex.P8 report to P.W.14, who registered the
case in Cr.No. 82 of 1999 under Section 302 read with 34, IPC against Al to A4. P.W.15
took up investigation, visited the scene of offence and conducted scene of offence
panchanama in the presence of P.W.10 and another and seized controlled earth from the
scene. Thereafter, he proceeded to Government Hospital and held inquest on the dead
body of the deceased in the presence of P.W.12 and others. He seized blood-stained
clothes from the body of the deceased. On inquest it was found that the deceased died as
a result of the injuries sustained by him. P.W.8 is the Doctor, who conducted the autopsy,
opined that the deceased died due to shock and hemorrhage due to injury to vital organ.
On 13.11.1999, A-1 to A-4 were arrested by the Sub-Inspector of Police, Kondapur and
produced before P.W.15. P.W.15 interrogated A-1 and A-1 gave confessional statement in
Ex.P6 and in pursuance of the confessional statement, a knife was recovered under
Ex.P7. As A-1 also sustained injuries, he was referred to hospital and examined by the
Doctor and Ex.P.10, wound certificate was issued. After receipt of the Forensic Sciences
Laboratory Report, he filed the charge sheet against A-1 and A-3 for the offence under
Section 302 read with 34, IPC. As A-4 was juvenile, he was produced before the Judicial
First Class Magistrate, Nizamabad, which is a juvenile Court. A-2 was absconding.
5. The learned Additional Judicial First Class Magistrate, Modak at Sangareddy, after
considering the material on record, came to the conclusion that the offence alleged
against the accused is exclusively triable by the Court of Session and, therefore, he
committed the case to the Court of Session. The learned Sessions Judge took the case on
file in S.C. No. 129 of 2001 and after hearing the prosecution and the defence and after
considering the material on record, charge for commission of offence punishable under
Section 302 read with 34, IPC was framed against A-1 and A-3. As A-1 and A-3 denied
the charge levelled against them, the prosecution examined P.Ws. 1 to 15 and marked
Exs. P1 to P12 besides marking of M.O.1 to prove its case. PWs. 1 to 4 were stated to be
eye-witnesses to the occurrence.
6. The stand of the appellant before the trial court was that the evidence of PWs 1 to 4
cannot be believed particularly when they are related to deceased and the presence of A2
and A3 at the time of incident is very much doubtful as they belong to some other village.
It was also contended that the medical evidence corroded credibility of ocular testimony
of PWs 1 to 4 as the injuries noticed were lacerated injuries which could not been caused
by a knife. P.Ws. 1 to 4 falsely implicated the accused. The trial court found the evidence
of PWs 1 to 4 to be credible and cogent and therefore convicted the accused-appellant. It
did not accept the plea of the accused that offence under
@page-SC507
Section 302, IPC is not made out.
7. The learned Sessions Judge accepting the evidence of P.Ws. 1 to 4, to be cogent and
credible came to the conclusion that A-1 caused injuries to the deceased and therefore he
was convicted and sentenced as stated above. Benefit of doubt was given to A-3 and
accordingly he was acquitted.
8. The judgment of the trial court was challenged before the High Court and the pleas
canvassed before the trial court were reiterated. The High Court as noted above did not
find any substance in the appeal and upheld the conviction and sentence imposed.
9. It was submitted by learned counsel for the appellant in support of the present appeal,
that PWs. 1 to 4 were related to the deceased and therefore their version is tainted. The
medical evidence rendered the ocular version improbable.
10. Learned counsel for the respondent-State supported the judgments of lower Court and
High Court.
11. We shall first deal with the contention regarding interestedness of the witnesses for
furthering prosecution version. Relationship is not a factor to affect credibility of a
witness. It is more often than not that a relation would not conceal actual culprit and
make allegations against an innocent person. Foundation has to be laid if plea of false
implication is made. In such cases, the court has to adopt a careful approach and analyse
evidence to find out whether it is cogent and credible.
12

. In Dalip Singh and Ors. v. The State of Punjab (AIR 1953 SC 364) it has been laid down
as under:- Para 26 of AIR

"A witness is normally to be considered independent unless he or she springs from


sources which are likely to be tainted and that usually means unless the witness has
cause, such as enmity against the accused, to wish to implicate him falsely. Ordinarily a
close relation would be the last to screen the real culprit and falsely implicate an innocent
person. It is true, when feelings run high and there is personal cause for enmity, that there
is a tendency to drag in an innocent person against whom a witness has a grudge along
with the guilty, but foundation must be laid for such a criticism and the mere fact of
relationship far from being a foundation is often a sure guarantee of truth. However, we
are not attempting any sweeping generalization. Each case must be judged on its own
facts. Our observations are only made to combat what is so often put forward in cases
before us as a general rule of prudence. There is no such general rule. Each case must be
limited to and be governed by its own facts."
13

. The above decision has since been followed in Guli Chand and Ors. v. State of
Rajasthan (1974 (3) SCC 698) in which Vadivelu Thevar v. State of Madras (AIR 1957
SC 614) was also relied upon. AIR 1974 SC 276
14

. We may also observe that the ground that the witness being a close relative and
consequently being a partisan witness, should not be relied upon, has no substance. This
theory was repelled by this Court as early as in Dalip Singh's case (supra) in which
surprise was expressed over the impression which prevailed in the minds of the Members
of the Bar that relatives were not independent witnesses. Speaking through Vivian Bose,
J. it was observed: AIR 1953 SC 364, Para 25

"We are unable to agree with the learned Judges of the High Court that the testimony of
the two eye-witnesses requires corroboration. If the foundation for such an observation is
based on the fact that the witnesses are women and that the fate of seven men hangs on
their testimony, we know of no such rule. If it is grounded on the reason that they are
closely related to the deceased we are unable to concur. This is a fallacy common to many
criminal cases and one which another Bench of this Court endeavoured to dispel in
Rameshwar v. State of Rajasthan (AIR 1952 SC 54 at p.59). We find, however, that it
unfortunately still persists, if not in the judgments of the Courts, at any rate in the
arguments of counsel."
15. Again in Masalti and Ors. v. State of U.P., (AIR 1965 SC 202) this Court observed
(p. 209-210 para 14):
"But it would, we think, be unreasonable to contend that evidence given by witnesses
should be discarded only on the ground that it is evidence of partisan or interested
witnesses.......The mechanical rejection of such evidence on the sole ground that it is
partisan would invariably lead to failure of justice. No hard and fast rule can be laid down
as to how much evidence should be appreciated. Judicial approach has to be
@page-SC508
cautious in dealing with such evidence; but the plea that such evidence should be rejected
because it is partisan cannot be accepted as correct."
16

. To the same effect is the decision in State of Punjab v. Jagir Singh (AIR 1973 SC 2407);
Lehna v. State of Haryana (2002 (3) SCC 76) and Gangadhar Behera and Ors. v. State of
Orissa (2002 (8) SCC 381). 2002 AIR SCW 4271

17

. The above position was highlighted in Babulal Bhagwan Khandare and Anr. v. State of
Maharashtra [2005 (10) SCC 404] and in Salim Saheb v. State of M.P. (2007 (1) SCC
699). 2004 AIR SCW 7376

18. The further plea related to primacy of medical evidence. The ocular testimonies has
been analysed in great detail and has been rightly held to be cogent.
19. Coming to the plea that the medical evidence is at variance with ocular evidence, it
has to be noted that it would be erroneous to accord undue primacy to the hypothetical
answers of medical witnesses to exclude the eye-witnesses' account which had to be
tested independently and not treated as the "variable" keeping the medical evidence as the
"constant".
20. It is trite that where the eye-witnesses' account is found credible and trustworthy,
medical opinion pointing to alternative possibilities is not accepted as conclusive.
Witnesses, as Bentham said, are the eyes and ears of justice. Hence the importance and
primacy of the quality of the trial process. Eye-witnesses' account would require a careful
independent assessment and evaluation for its credibility which should not be adversely
prejudged making any other evidence, including medical evidence, as the sole touchstone
for the test of such credibility. The evidence must be tested for its inherent consistency
and the inherent probability of the story; consistency with the account of other witnesses
held to be creditworthy; consistency with the undisputed facts, the "credit" of the
witnesses; their performance in the witness box; their power of observation etc. Then the
probative value of such evidence becomes eligible to be put into the scales for a
cumulative evaluation.
21

. The above position was reiterated in Krishan and another v. State represented by
Inspector of Police [(2003) 7 SCC 56]. 2003 AIR SCW 3688

22. Even otherwise, factually also the medical evidence is not contrary to ocular evidence
as claimed. On the contrary the doctor (PW 8) has clearly stated as to under what
circumstances lacerated injury can be caused by a knife.
23. Learned counsel for the appellant submitted that the occurrence took place in course
of sudden quarrel and, therefore, the trial court and the High Court were not justified in
holding the accused-appellant guilty of offence punishable under Section 302, IPC.
24. In essence the stand of learned counsel for the appellant is that Exception IV to
Section 304, IPC would apply to the facts of the case.
25. For bringing in operation of Exception 4 to Section 300, IPC, it has to be established
that the act was committed without premeditation, in a sudden fight in the heat of passion
upon a sudden quarrel without the offender having taken undue advantage and not having
acted in a cruel or unusual manner.
26. The Fourth Exception to Section 300, IPC covers acts done in a sudden fight. The
said Exception deals with a case of prosecution not covered by the First Exception, after
which its place would have been more appropriate. The Exception is founded upon the
same principle, for, in both there is absence of premeditation. But, while in the case of
Exception 1 there is total deprivation of self-control, in case of Exception 4, there is only
that heat of passion which clouds men's sober reason and urges them to deeds which they
would not otherwise do. There is provocation in Exception 4 as in Exception 1; but the
injury done is not the direct consequence of that provocation. In fact Exception 4 deals
with cases in which notwithstanding that a blow may have been struck, or some
provocation given in the origin of the dispute or in whatever way the quarrel may have
originated, yet the subsequent conduct of both parties puts them in respect of guilt upon
equal footing. A "sudden fight" implies mutual provocation and blows on each side. The
homicide committed is then clearly not traceable to unilateral provocation, nor in such
cases could the whole blame be placed on one side. For if it were so, the Exception more
appropriately applicable would be Exception 1. There is no previous deliberation or
determination to fight. A fight suddenly takes place, for which both parties are more or
less to be
@page-SC509
blamed. It may be that one of them starts it, but if the other had not aggravated it by his
own conduct it would not have taken the serious turn it did. There is then mutual
provocation and aggravation, and it is difficult to apportion the share of blame which
attaches to each fighter. The help of Exception 4 can be invoked if death is caused (a)
without premeditation; (b) in a sudden fight; (c) without the offender having taken undue
advantage or acted in a cruel or unusual manner; and (d) the fight must have been with
the person killed. To bring a case within Exception 4 all the ingredients mentioned in it
must be found. It is to be noted that the "fight" occurring in Exception 4 to Section 300
IPC is not defined in IPC. It takes two to make a fight. Heat of passion requires that there
must be no time for the passions to cool down and in this case, the parties have worked
themselves into a fury on account of the verbal altercation in the beginning. A fight is a
combat between two or more persons whether with or without weapons. It is not possible
to enunciate any general rule as to what shall be deemed to be a sudden quarrel. It is a
question of fact and whether a quarrel is sudden or not must necessarily depend upon the
proved facts of each case. For the application of Exception 4, it is not sufficient to show
that there was a sudden quarrel and that there was no premeditation. It must further be
shown that the offender has not taken undue advantage or acted in cruel or unusual
manner. The expression "undue advantage" as used in the provision means "unfair
advantage".
27

. The above position is highlighted in Sandhya Jadhav v. State of Maharashtra (2006) 4


SCC 653). 2006 AIR SCW 1678

28. Considering the background facts, appropriate conviction would be under Section 304
Part I IPC and not Section 302 IPC. The conviction is accordingly altered. Custodial
sentence of ten years would suffice.
29. Appeal is allowed to the aforesaid extent.
Appeal allowed.
AIR 2008 SUPREME COURT 509 "State of Rajasthan v. M/s. Khandaka Jain Jewellers"
(From : Rajasthan)
Coram : 2 A. K. MATHUR AND MARKANDEY KATJU, JJ.
Civil Appeal No. 5273 of 2007 (arising out of SLP (C) No. 19439 of 2006), D/- 16 -11
-2007.
State of Rajasthan and Ors. v. M/s. Khandaka Jain Jewellers.
(A) Stamp Act (2 of 1899), S.17, S.2(12) - Rajasthan Stamp Law (Adaptation) Act (7 of
1952), S.47A(1) (as inserted by Raj. Act 10 of 1982) - STAMP DUTY - SALE DEED -
EXECUTION - Stamp duty - Assessment - Relevant date for determining market value -
Stamp duty on sale deed - Current market value at time of execution has to be seen - Fact
that purchaser had to litigate for getting sale deed executed - Immaterial.
AIR 1998 AP 252, Overruled.
D. B. Civil Spl. Appeal Writ No. 427 of 2002, D/- 23-11-2005 (Raj), Reversed.
The valuation of property mentioned in instrument has to be done at current market value
at time of its execution. Fact that purchaser had to litigate for long to get the instrument
(Sale Deed) registered is immaterial. Section 17 stipulates that all the instruments
chargeable with duty and executed by person of India shall be stamped before or "at the
time of execution". The word "execution" has been defined in Section 2(12) which says
that "Execution" used with reference to the instruments, mean "signed" and "signature". It
shows that the document which is sought to be registered has to be signed by both the
parties. Till that time the document does not become an instrument for registration. A
reading of Section 2(12) with Section 17 clearly contemplates that the document should
be complete in all respects when both the parties should have signed it with regard to the
transfer of the immovable property. The expression "execution" read with Section 17
leaves no manner of doubt that the current valuation is to be seen when the instrument is
sought to be registered. Therefore, the market value of the instrument has to be seen at
the time of the execution of the sale deed, and not at the time when agreement to sale was
entered into. An agreement to sell is not a sale. An agreement to sale becomes a sale after
both the parties signed the sale deed. A taxing statute has to be construed strictly and
considerations of hardship or equity have
@page-SC510
no role to play in its construction.
AIR 1998 AP 252, Overruled.
D. B. Civil Spl. Appeal Writ No. 427 of 2002, D/- 23-11-2005 (Raj), Reversed.
(Paras 10, 13, 14)
(B) INTERPRETATION OF STATUTES - PRINCIPLES - Interpretation of Statutes -
Taxing statute - To be construed strictly principle of "Actus curie neminem gravabit" -
Does not affect the Principles of interpretation of a taxing statute. (Para 14)
Cases Referred : Chronological Paras
AIR 1998 Andh Pra 252, (Overruled)3, 14, 15
AIR 1957 SC 657 (Rel.on) 11
V. Madhukar, Sumit Ghosh and Aruneshwar Gupta, for Appellants; Dr. Manish Singhvi
and P. V. Yogeswaran, for Respondent.
Judgement
1. A. K. MATHUR, J. :- Leave granted.
2. This appeal is directed against the judgment dated 23.11.2005 passed by the Division
Bench of the High Court of Judicature for Rajasthan at Jaipur Bench, Jaipur in SBCWP
No. 133/1997 and DBCSA No. 427/2002 whereby the division bench has affirmed the
order of the learned Single Judge.
3. Brief facts which are necessary for the disposal of this appeal are as under:
The S.B. Civil Writ Petition No. 133/97 was filed by M/s. Khandaka Jain Jewellers,
petitioner (respondent herein) in the High Court of Judicature for Rajasthan, Jaipur
Bench, Jaipur who prayed that a direction may be issued to the respondent Nos. 2and 3
to register the sale deeds sent by the Court of additional district Judge No. 1, Jaipur city
in execution application No. 15/94 and 16/94 and to send back the same to the Court
immediately after registration. It was also prayed that the respondents may be directed to
register the sale deeds on the stamps on which it is executed by the executing court and
not to charge more stamp duty from respondent (herein). It was further prayed to quash
and set aside the proceedings taken under Section 47A(2) of the Stamps Act, 1952 in case
No. 442/95 and 443/95 on 4th March, 1997 for determination of the valuation of the sale
deed for registration.
The respondent is a registered firm and it entered into two agreements for purchase of
properties with Shri Prem Chand Ajmera, resident of 2148, Haldiyon Ka Rasta Jaipur by
one agreement dated 20th October, 1983. The property was agreed to be purchased for a
sum of Rs. 1,41,000/- out of which Rs. 20,000/- were paid at the time of the agreement.
As the vendor failed to comply with the terms of the agreement, the respondent vendee
filed a suit for specific performance of the contract in the Court of district Judge, Jaipur
city which was later on transferred to the Court of additional district Judge No.1, Jaipur
city under registration No. 216/86. The suit was decreed by the Judgment and decree
dated 2nd February,1994. In pursuance of the said decree, the respondent firm deposited
an amount of Rs. 1,21,000/- in the Court on 9th May, 1994. Since the vendor did not
execute the sale deed, therefore, the respondent firm filed the execution application No.
16/90 before the Court of additional district Judge No. 1, Jaipur city.
In another agreement dated 20th October, 1983 the vendor Premchand agreed to sell a
portion of property for a sum of Rs. 50,000/- out of which Rs. 10,000/- was paid at the
time of agreement. The respondent firm purchased the stamp papers and got the sale deed
typed. In this case also the vendor failed to fulfill the condition of agreement and to
execute the sale deed. Consequently, the respondent firm filed another suit for specific
performance of the contract in the Court of district Judge, Jaipur city. It was also
transferred to the court of additional district Judge No. 1, Jaipur city under registration
No. 151/91. The suit was decreed vide judgment and decree dated 2nd February, 1994
and the respondent firm was directed to deposit the remaining amount of Rs. 40,000/- and
the judgment debtor would execute the sale deed. If the judgment debtor fails to comply
with the decree, the decree holder would be entitled to get the sale deed registered and to
get the possession. In compliance of the judgment and decree passed by the Court, the
respondent firm deposited an amount of Rs. 40,000/- in the court but the judgment debtor
did not execute the sale deed. The execution application No. 15/94 was filed before the
Court of additional district Judge No. 1, Jaipur city. Both these applications No. 15/94
and 16/94 were taken up by the executing court and the respondent firm was directed to
submit the stamp papers for the execution of the two sale deeds. The stamp papers for a
sum of Rs.14,100/- and
@page-SC511
Rs. 5,000/- for execution of the sale deeds in respect of properties purchased for a sum of
Rs. 1,41,000/- and Rs. 50,000/- respectively, were submitted by the respondent firm.
The learned executing court executed the sale deeds and sent the same on 17th March,
1995 for registration before the Sub-Registrar, Registration Department, Collectorate
Bani Park, Jaipur. The Sub-Registrar exercising its powers under Section 47A(1) of the
Stamp Act sent these two sale deeds to Collector (Stamps) Jaipur for determining the
market value and to assess the charge of the stamp duty. The Collector (stamps)
registered these two cases No. 442/95 and 443/95 of the respondent firm and passed the
order dated 5th March, 1997. In case No. 442/95 he assessed value of the property as Rs.
5,60,000/- and deficient stamp duty was raised to the extent of Rs. 41,900/- and deficient
registration fees as Rs 1500/- and he also levied the penalty of Rs. 1000/-. Thus, the total
amount against the respondent firm raised was Rs. 44,400/-. In the second case No.
443/95 he assessed value of the property as Rs. 3,87,580/- and deficient stamp duty to the
extent of Rs. 33,758/- and deficient registration fees as Rs. 1500/- and the penalty of Rs.
1000/-. Thus the total amount directed to be recovered from the respondent firm was Rs.
36,258/-. The respondent firm filed writ petition challenging both these orders and the
contention of the respondent firm was that the valuation of the property should be taken
when the agreement of sale deed was executed, and not at the time of the registration of
the sale deed. The learned Single Judge relying on the judgment in the case of Sub
Registrat, Kodad Town and Mandal v. Amaranaini China Venkat Rao and Others
reported in AIR 1998 Andhra Pradesh 252 allowed the writ petition and observed that
since the vendor backed out and did not execute the sale deed of the property in
pursuance of the agreement on 20th October, 1983 therefore, the respondent firm filed a
suit for specific performance of contract in 1986 and the suit was decreed. The
respondent firm was ready and willing to pay the amount, and therefore, it was not his
fault. The same was the position regarding the second suit which was filed in 1991. The
learned Judge after considering the matter directed to set aside both the orders and held
that for the purpose of charging stamp duty, etc, the relevant date for assessment of the
market value shall be the date on which the suit for specific performance of the
agreement to sale was filed. Consequently the order dated 4th March, 1997 (Annexures 5
and 6) was quashed and the authorities were directed to pass a fresh order regarding the
market value of the property in question for the purpose of levy of the stamp duty as on
the date of filing of the suit and also directed to undertake this exercise keeping in view
the observation of the judgment within a period of one month from the date of receipt of
the certified copy of the order after notice to respondent firm.
4. Aggrieved against this order, an appeal was preferred before the Division Bench of the
Rajasthan High Court at Jaipur Bench and the Division Bench affirmed the order of the
learned single Judge. Aggrieved against the order of the Division Bench, the present
appeal was preferred by the State of Rajasthan and Ors., appellants herein.
5. We have heard learned counsel for the parties and perused the records.
6. The question is whether the valuation should be assessed on the market rate prevailing
at the time of registration of the sale deed or when the parties entered into agreement to
sell.
7. Learned counsel for the State has submitted that the Stamp Act is a taxing statute and a
taxing statute has to be construed strictly. Whatsoever may have been the consideration
for the vendor not to get the sale deed executed is a matter between both the parties, but
when the matter is before the registering Authority the registering Authority has to see the
valuation of the property at the market rate at the time of the registration as per Section
17 of the Act. Therefore, a notice under Section 47A of the (Rajasthan Amendment)
Stamp Duty Act was given and proper valuation was determined for registration. As
against this, the learned counsel for the respondent submitted that Section 3 of the Act is
a charging section. The registering authority has to see the instrument and the
consideration mentioned therein for payment of duty as per Section 27 of the Act. If he
finds it undervalued then he can hold an inquiry with regard to market value which was
prevailing at the time of agreement to sell.
8. In order to appreciate the controversy involved in the matter, it is necessary to
@page-SC512
reproduce the relevant provisions of the Stamp Act which are as under:
Section 2(12) of the Act reads as under:
"(12) "Executed", and "execution", used with reference to instruments, mean "signed"
and "signature"."
Section 3 of the Act reads as under:
"3. Instruments chargeable with duty - Subject to the provisions of this Act and the
exemptions contained in Schedule I, the following instruments shall be chargeable with
duty of the amount indicated in that Schedule as the proper duty therefor, respectively,
that is to say-
(a) every instrument mentioned in that Schedule which, not having been previously
executed by any person, is executed in (India) on or after the first day of July, 1899;
(b) every bill of exchange payable otherwise than on demand or promissory note drawn
or made out of India on or after that day and accepted or paid, or presented for acceptance
or payment, or endorsed, transferred or otherwise negotiated, in India; and
(c) every instrument (other than a bill of exchange or promissory note) mentioned in that
Schedule, which, not having been previously executed by any person, is executed out of
India on or after that day relates to any property situate, or to any matter or thing done or
to be done, in India and is received in India:
Provided that no duty shall be chargeable in respect of-
(1) any instrument executed by, or on behalf of, or in favour of, the Government in cases
where, but for this exemption, the Government would be liable to pay the duty chargeable
in respect of such instrument;
(2) any instrument for the sale, transfer or other disposition, either absolutely or by way
of mortgage or otherwise, of any ship or vessel, or any part, interest, share or property of
or in any ship or vessel, registered under the Merchant Shipping Act, 1894, or under Act
19 of 1938, or the Indian Registration of Ships Act, 1841 (10 of 1841) as amended by
subsequent Acts.
(3) Any instrument executed, by or on behalf of, or in favour of the Developer, or Unit or
in connection with the carrying out of purposes of the Special Economic Zone.
...
..."
Section 17 of the Act reads as under:
"17. Instruments executed in India - All instrument chargeable with duty and executed by
any person in India shall be stamped before or at the time of execution."
Section 27 of the Act reads as under:
"27. Facts affecting duty to be set forth in instrument.- The consideration (if any) and all
other facts and circumstances affecting the chargeability of any instrument with duty, or
the amount of the duty with which it is chargeable, shall be fully and truly set forth
therein."
Section 47-A inserted by Rajasthan(Amendment) State Stamp Act reads as under:
"S.47-A. Instruments under-valued, how to be valued.- (1) Notwithstanding anything
contained in the Registration Act, 1908 (Central Act XVI of 1908) and the rules made
thereunder as in force in Rajasthan where in the case of any instrument relating to an
immovable property chargeable with an ad valorem duty on the market value of the
property as set forth in the instrument, the registering officer has, while registering the
instruments, reason to believe that the market value of the property has not been truly set
forth in the instrument, he may either before or after registering the instrument, send it in
original to the Collector for determination of the market-value and to assess and charge
the duty in conformity with such determination together with a penalty not exceeding ten-
times the deficient stamp duty chargeable and surcharge, if any, payable on such
instrument.
(2) On receipt of the instrument under sub-section(1), the Collector shall, after giving the
parties a reasonable opportunity of being heard and after holding an enquiry in the
prescribed manner determine the market-value and the duty including penalty and
surcharge, if any, payable thereon; and if the amount of duty including penalty and
surcharge, if any, already paid, is deficient, the deficient amount shall be payable by the
person liable to pay the duty including penalty and surcharge, if any.
(2-A) Where it appears to a person having by law or consent of parties authority to
receive evidence or a person in charge of a public office, during the course of inspection
or otherwise, except an officer of a police, that an instrument is undervalued, such person
shall forthwith make a
@page-SC513
reference to the Collector in that matter.
(3) The Collector may, suo motu, or on a reference made under sub-section (2-A) call for
and examine any instrument not referred to him under sub-section (1), from any person
referred to in sub-section (2-A) or the executant or any other person for the purpose of
satisfying himself as to the correctness of the market-value of such property has not been
truly set forth in the instrument, he may determine in accordance with the procedure
provided in sub-section (2), the market-value and the amount of stamp duty together with
a penalty not exceeding ten times the deficient stamp duty chargeable on it, which shall
be payable by the person liable to pay the stamp duty and penalty.
(4) Where for any reason the original document called for by the Collector under sub-
section (3) is not produced or cannot be produced, the Collector may after recording the
reasons for its non-production call for a certified copy of the entries of the document
from the registering officer concerned and exercise the powers conferred on him under
sub-section (3).
(5) For the purpose of enquiries under this section, the Collector shall have power to
summon and enforce the attendance of witnesses including the parties to the instrument
or any of them, and to complete the production of documents by the same means, and so
far as may be in the same manner, as is provided in the case of Civil Court under Code of
Civil Procedure, 1908 (Central Act V of 1908)."
9. The contention of the learned counsel for the State that as per Section 17 of the Act, the
market value has to be taken into consideration because Section 17 stipulates that all the
instruments chargeable with duty and executed by person of India shall be stamped
before or "at the time of execution". The word "execution" has been defined in Section
2(12) of the Act which says that "Execution" used with reference to the instruments,
mean "signed" and "signature". Therefore, it shows that the document which is sought to
be registered has to be signed by both the parties. Till that time the document does not
become an instrument for registration. A reading of Section 2(12) with Section 17 clearly
contemplates that the document should be complete in all respects when both the parties
should have signed it with regard to the transfer of the immovable property. It is
irrelevant whether the matter had gone in for litigation.
10. It may be mentioned that there is a difference between an agreement to sell and a sale.
Stamp duty on a sale has to be assessed on the market value of the property at the time of
the sale, and not at the time of the prior agreement to sell, nor at the time of filing of the
suit. This is evident from section 17 of the Act. It is true that as per Section 3, the
instrument is to be registered on the basis of the valuation disclosed therein. But Section
47-A of the Rajasthan(Amendment) Stamp Duty Act contemplates that in case it is found
that properties are under-valued then it is open for the Collector (Stamps) to assess the
correct market value. Therefore, in the present case when the registering authority found
that valuation of the property was not correct as mentioned in the instrument, it sent the
document to the Collector for ascertaining the correct market value of the property. The
expression "execution" read with Section 17 leaves no manner of doubt that the current
valuation is to be seen when the instrument is sought to be registered. The Stamp Act is in
the nature of a taxing statute, and a taxing statute is not dependant on any contingency.
Since the word "execution" read with Section 17 clearly says that the instrument has to be
seen at the time when it is sought to be registered and in that if it is found that the
instrument has been undervalued then it is open for the registering authority to enquire
into its correct market value. The learned single Judge as well as the Division Bench in
the present case had taken into consideration that the agreement to sell was entered into
but it was not executed. Therefore, the incumbent had to file a suit for seeking a decree
for execution of the agreement and that took a long time. Therefore, the Courts below
concluded that the valuation which was in the instrument should be taken into account. In
our opinion this is not a correct approach. Even the valuation at the time of the decree is
also not relevant. What is relevant in fact is the actual valuation of the property at the
time of the sale. The crucial expression used in Section 17 is "at the time of execution".
Therefore, the market value of the instrument has to be seen at the time of the execution
of the sale deed, and not at the time when agreement to sale was entered into. An
agreement to sell is not a sale. An
@page-SC514
agreement to sell becomes a sale after both the parties signed the sale deed. A taxing
statute is not contingent on the inconvenience of the parties. It is needless to emphasize
that a taxing statute has to be construed strictly and considerations of hardship or equity
have no role to play in its construction. VISCOUNT SIMON quoted with approval a
passage from ROWLATT, J. expressing the principle in the following words
"In a taxing Act one has to look merely at what is clearly said. There is no room for any
intendment. There is no equity about a tax. There is no presumption as to tax. Nothing is
to be read in, nothing is to be implied. One can only look fairly at the language used."
11. The same view was expressed by Hon'ble Bhagwati J. in the case of A.V. Fernandez v.
State of Kerala reported in AIR 1957 SC 657. The principle is as follows:
"In construing fiscal statutes and in determining the liability of a subject to tax one must
have regard to the strict letter of the law. If the revenue satisfies the court that the case
falls strictly within the provisions of the law, the subject can be taxed. If on the other
hand, the case is not covered within the four corners of the provisions of the taxing
statute, no tax can be imposed by inference or by analogy or by trying to probe into the
intention of the Legislature and by considering what was the substance of the matter."
Hon'ble Shah J. has formulated the principle thus: "In interpreting a taxing statute,
equitable considerations are entirely out of place. Nor can taxing statutes be interpreted
on any presumptions or assumptions. The court must look squarely at the words of the
statute and interpret them. It must interpret a taxing statute in the light of what is clearly
expressed; it cannot imply anything which is not expressed; it cannot import provisions in
the statute so as to supply any assumed deficiency."
Therefore, a taxing statute has to be read as it is. In other words, the literal rule of
interpretation applies to it.
12. In this back-ground, if we construe Section 17 read with Section 2(12) then there is
no manner of doubt that at the time of registration, the Registering Authority is under an
obligation to ascertain the correct market value at that time, and should not go by the
value mentioned in the instrument.
13. Learned counsel for the respondent submitted that if we construe Section 3 read with
Section 27 of the Act then the Registering Authority is under an obligation to only see the
value mentioned in the instrument. In our opinion Section 3 which is the charging section
cannot be read in isolation but has to be read along with Section 17 of the Act. From a
composite reading of Sections 3,17 and 27, it becomes abundantly clear that the valuation
given in an instrument is not conclusive. If any doubt arises in the mind of the
Registering Authority that the instrument is under-valued then as per Section 47-A of the
Rajasthan (Amendment) the instrument can be sent to the Collector for determination of
the correct market value. Under Section 47-A read with Sections 3,17 and 27, it becomes
clear that the Registering Authority has to ascertain the correct valuation given in the
instrument regarding market value of the property at the time of the sale.
14

. Learned Counsel for the respondent strenuously urged before us that in fact when the
agreement to sell was not executed by the vendor, the respondent had no option but to file
a suit and a long time was taken for obtaining a decree for execution of the agreement. He
was not at fault and as such the valuation given in the instrument should be taken into
consideration because during the litigation the valuation of the property has shot up. In
this connection, learned counsel has invited our attention to the principle "Actus curie
neminem gravabit" meaning thereby that no person shall suffer on account of litigation.
Hence learned counsel submitted that since the matter had been in the litigation for a long
time, the respondent cannot be made to suffer. He invited our attention to the decision of
the Andhra Pradesh High Court Sub-Registrar, Kodad Town and Mandal (supra). It is
true that no one should suffer on account of the pendency of the matter but this
consideration does not affect the Principles of interpretation of a taxing statute. A taxing
statute has to be construed as it is all these contingencies that the matter was under
litigation and the value of the property by that time shot up cannot be taken into account
for interpreting the provisions of a taxing statute. As already mentioned above a taxing
statute has to be construed strictly and if it is construed strictly then the plea that AIR
1998 AP 252

@page-SC515
the incumbent took a long time to get a decree for execution against the vendor that
consideration cannot weigh with the Court for interpreting the provisions of the taxing
statutes. Therefore, simply because the matter have been in the litigation for a long time
that cannot be a consideration to accept the market value of the instrument when the
agreement to sale was entered. As per Section 17, it clearly says at the time when
registration is made, the valuation is to be seen on that basis.
15. In the case of Sub-Registrar, Kodad Town and Mandal (Supra), the learned single
Judge of the Andhra Pradesh High Court felt persuaded on account of 30 years' long
litigation and therefore, declined to send the papers back to the Collector for valuation at
the market value. With great respect, the view taken by the learned single Judge is against
the principles of interpretation of a taxing statute. Therefore, we are of the opinion that
the view taken by the learned single Judge of the Andhra Pradesh High Court is not
correct.
16. Accordingly, we are of the opinion that the view taken by the learned single Judge as
well as by the Division Bench cannot be sustained and the same is set aside. The
Collector shall determine was the valuation of the instrument on the basis of the market
value of the property at the date when the document was tendered by the respondent for
registration, and the respondent shall pay the stamp duty charges and surcharge, if any, as
assessed by the Collector as per the provisions of the Act. The appeal of the State is
allowed. No order as to costs.
Appeal allowed.
AIR 2008 SUPREME COURT 515 "Mahmood v. State of U. P."
(From : Allahabad)*
Coram : 2 ALTAMAS KABIR AND B. SUDERSHAN REDDY, JJ.
Criminal Appeal No. 402 of 2006, D/- 15 -11 -2007.
Mahmood and Anr. v. State of U.P.
(A) Criminal P.C. (2 of 1974), S.157 - INVESTIGATION - MAGISTRATE - Sending
special report to Magistrate - Time required by Station House Officer after recording FIR
- No universal rule as to, can be laid down - Each case turns on its own facts.
2002 AIR SCW 4290, AIR 1975 SC 1962, AIR 1975 SC 1193, Rel. on. (Para 12)
(B) Criminal P.C. (2 of 1974), S.154 - FIR - FIR - Informant alone rushed to police
station 9 Kms. away from place of occurrence by bicycle and lodged written FIR within 1
1/2 hours of incident - His evidence showing that he took about 15-20 minutes to prepare
his report and nobody advised him in its preparation - Said version cannot be disbelieved
- Stating details of incident in written FIR nor unnatural or unusual - Nothing artificial in
FIR - Cannot be said to be contrived one brought into existence after due deliberations -
Moreover Inquest Report prepared later on refers to lodging of FIR by informant - Mere
fact that crime number is not mentioned in it is of no significance - Further arrest of one
person from place of occurrence at 3.00 P.M. by investigating officer in connection with
another case - Would not militate against time of FIR as shown in police papers - Held,
FIR is not ante time and ante dated. (Paras 16, 17, 18, 21)
(C) Penal Code (45 of 1860), S.300, S.149 - MURDER - UNLAWFUL ASSEMBLY -
ASSAULT - Murder - Unlawful assembly - Accused persons assaulted deceased with fire
arms and lathi - Son of deceased proved to be present in his fields situated nearby place
of occurrence - He gave detailed version as to manner of assault and role played by each
of accused - His presence cannot be doubted merely because he made no attempt to save
his father - Names of other witnesses also mentioned as eye- witnesses in FIR itself
-Thus said witnesses were not chance witnesses and their presence cannot be disbelieved
on basis of medical evidence - Their testimony cannot be disbelieved - Specific overt act
of accused need not be established as membership of unlawful assembly already
established - Conviction of accused - No interference. (Paras 22, 23, 26, 27)
(D) Evidence Act (1 of 1872), S.45 - EVIDENCE - Expert evidence - Medical Officer - Is
not ballistic expert - He was not expected to answer whether injury in question could
have been caused by bullet alone.
The Medical Officer is not ballistic expert. He was not expected to answer as to whether
injury in question could have been caused
@page-SC516
by bullet alone. His opinion to that extent is of no consequence. It is well settled that
medical evidence is only an evidence of opinion and it is not conclusive and when oral
evidence is found to be inconsistent with the medical opinion, the question of relying
upon one or the other would depend upon the facts and circumstances of each case. No
hard and fast rule can be laid down therefor. The ocular evidence if otherwise is
acceptable has to be given importance over medical opinion. However, where the mdical
evidence totally improbabilises the ocular version the same can be taken to be a factor to
affect credibility of the prosecution version. Thus no reliance can be placed upon the
opinion of the Medical Officer that the injury in question could have been caused only
with bullet since he is not a ballistic expert. This part of the evidence of the Medical
Officer cannot be considered to be the opinion of an expert and the same has no
evidentiary value.
(Para 25)
(E) Penal Code (45 of 1860), S.149 - UNLAWFUL ASSEMBLY - Unlawful assembly -
Its membership once established, prosecution need not establish any specific overt act to
any of the accused for fastening of liability with aid of S. 149. (Para 26)
Cases Referred : Chronological Paras
2006 AIR SCW 2686 : AIR 2006 SC 2500 : 2006 Cri LJ 2886 14
2002 AIR SCW 4290 : AIR 2002 SC 3648 : 2003 Cri LJ 17 (Rel. on) 11
2001 AIR SCW 2833 : AIR 2001 SC 3173 : 2001 Cri LJ 3969 9
1994 AIR SCW 2210 : 1995 Cri LJ 427 8
AIR 1975 SC 1193 : 1974 Cri LJ 908 (Rel. on) 13
AIR 1975 SC 1962 : 1975 Cri LJ 1734 (Rel. on) 13
Harjinder Singh, Sr. Advocate, R. C. Kohli, Ms. Shikha Tyagi, Ms. Seema Juneja, for
Appellants; Shail Kumar Dwivedi, AAG, A. K. Jha, Prashant Choudhary, Ms. Vandana
Mishra, Manoj Dwivedi, for Respondent.
* Cri. A. No. 367 of 1980, D/- 17-5-2005 (All) (LB).
Judgement
B. SUDERSHAN REDDY, J. :- This is an appeal by special leave preferred by the
appellants-Mahmood and Khaliq. The appellant-Mahmood has been convicted for the
offence punishable under Section 302 read with Section 149 of IPC and sentenced to
imprisonment for life. He has been also convicted under Section 148 of IPC and
sentenced to undergo rigorous imprisonment for 1½ year. The second appellant has been
convicted for the offence punishable under Section 302 read with Section 149 and
sentenced to undergo life imprisonment. He has been further convicted under Section 147
of IPC and sentenced to undergo one year rigorous imprisonment and further convicted
under Section 379 of IPC and sentenced to undergo rigorous imprisonment for a period of
two years.
2. Put briefly the prosecution case is as follows :
On 19th February, 1977 at about 4.45 p.m. the accused Ram Samujh and Mahmood
appellant No.1 both armed with guns, Khalid-appellant No.2, Bajrang and one
unidentified person armed with lathi assaulted deceased Ram Singh at Galiyara near the
fields of Ram Sewak Ahir, while he was returning to his village Badipur on his
motorcycle. It was alleged that the accused Ram Samujh and Mahmood fired four shots,
as a result of which the deceased fell down injured and thereafter Khaliq snatched the
licensed revolver belonging to the deceased and all the five fled away from the scene.
Ram Singh died on the spot. The incident of murderous attack was witnessed by Jaikirat
Singh (P.W.1) who is none other than the son of deceased-Ram Singh, Ram Ratan
(P.W.2), resident of village Sujerpur hamlet of Bodipur and Ram Adhar (P.W.3). P.W.1
lodged written First Information Report Ext.Ka.1 on the same day at 4.45 p.m. naming all
the accused and the manner in which the murderous attack on the deceased had taken
place. Jagdamba Prasad Dwivedi (P.W.7) the office in-charge of Police station, Kothi
rushed to the scene of offence at about 6.00 p.m. and found the dead body of Ram Singh
and his motorcycle in galiyara near the fields of Ram Sewak Ahir. The broken pieces of
the skull of the deceased and broken three teeth were seized from the place of occurrence.
The discharged cartridge and tickli were also seized from the spot. P.W.7 after preparing
the Inquest Report (Ext. Ka.7) sent the dead body for conducting post-mortem. Dr. R.S.
Katiyar P.W.5 performed the autopsy on the dead body on 20th February, 1977 at about
9.45 a.m. and found as many as five ante-mortem gun shot wounds. A cap of cartridge
was extricated from the brain of the deceased. Scalp bones were found fractured. It was
found that vital organs like peritoneum, liver, kidneys
@page-SC517
were badly ruptured. In the opinion of the doctor, the cause of death was due to shock and
hemorrhage resulting from ante-mortem injuries. The investigation of the case was
transferred in the first week of March, 1977 to CBCID. Inspector M.L. Gautam having
completed rest of the investigation submitted charge-sheet against the appellants and
other accused.
3. The accused have denied the charges framed against them and took the plea that they
have been falsely implicated due to enmity. The accused were accordingly put on trial.
The prosecution in order to establish its case in altogether examined 8 witnesses and got
marked 39 documents as Exts. Ka.1-39. Amongst the witnesses examined by the
prosecution, Jaikirath Singh, Ram Ratan and Ram Adhar (P.Ws. 1,2 and 3) respectively
were eye-witnesses to the murderous attack on the deceased. The accused also led
evidence and examined Virendra Singh DW 1, Laxmi Narain Sinha DW 2 and Bindra
Charan DW 3.
4. The learned Sessions Judge upon appreciation of the oral evidence and material on
record found all the accused guilty of the charges framed against them and sentenced
them to various terms of imprisonment. On appeal the High Court of Allahabad
confirmed the conviction and sentences imposed by the learned Sessions Judge. The
appellants who are accused Nos.2 and 3 respectively alone have preferred this appeal by
special leave, challenging their conviction and sentence.
5. We have elaborately heard the learned senior counsel Shri Harjinder Singh and Shri
R.C. Kohli as well as Shri Shail Kumar Dwivedi, learned Additional Advocate General
for the State.
6. The learned senior counsel Shri Harjinder Singh mainly contended that the FIR lodged
by P.W.1 Jaikirath Singh was ante-timed and ante-dated and brought into existence after
due deliberations and consultations with the police.
7. According to the learned senior counsel, the special report required to be sent to the
superior authorities and a copy of check FIR to the Illaqua Magistrate as required under
Section 157 of the Code of Criminal Procedure was not sent by the police. That apart
arrest of Maiku Bhujwa before 3.40 p.m. and his detention in the police station at 5.30
p.m. and also the fact that some seizure memos, prepared by Investigating Officer on the
same day which do not bear any crime number, are more than sufficient to doubt the
timings of FIR Ext.Ka.1.
8

. There is no doubt that FIR in a criminal case and particularly in murder case is a vital
and valuable piece of evidence for the purpose of appreciating evidence led by the
prosecution at the trial. FIR is the earliest information regarding the circumstances under
which the crime was committed, including the names of the actual culprits and the part
played by them, the weapons, if any, used as also the names of the eye-witnesses, if any.
Delay in lodging the FIR may result in embellishment, which is a creature of an after
thought. This court in Meharaj Singh vs. State of U.P.1observed that with a view to
determine whether the FIR was lodged at the time it is alleged to have been recorded, the
courts generally look for certain external checks. One of the check is the receipt of the
copy of the FIR, called as a Special Report in a murder case, by the local Magistrate. "If
this report is received by the Magistrate late it can give rise to an inference that the FIR
was not lodged at the time it is alleged to have been recorded, unless, of course, the
prosecution can offer a satisfactory explanation for the delay in despatching or receipt of
the copy of the FIR by the local Magistrate. The second external check equally important
is sending of copy of the FIR along with the dead body and its reference in the Inquest
Report". 1994 AIR SCW 2210

1 (1994) 5 SCC 188.


9

. This court while construing Section 157 of the Code of Criminal Procedure in Anil Rai
vs. State of Bihar2observed that the said provision is designed to keep the Magistrate
informed of the investigation of such cognizable offence so as to be able to control the
investigation and if necessary to give appropriate direction under Section 159 of the
Code. "But where the FIR is shown to have actually been recorded without delay and
investigation started on the basis of the FIR, the delay in sending the copy of the report to
the Magistrate cannot by itself justify the conclusion that the investigation was tainted
and the prosecution insupportable." 2001 AIR SCW 2833

2 (2001) 7 SC 318
10. This court further took the view that the delay contemplated under Section 157
@page-SC518
of the Code for doubting the authenticity of the FIR is not every delay but only extra-
ordinary and unexplained delay. We do not propose to burden this short judgment of ours
with various authoritative pronouncements on the subject since the law is so well settled
that delay in despatch of FIR by itself is not a circumstance which can throw out the
prosecutions case in its entirety, particularly in cases where the prosecution provides
cogent and reasonable explanation for the delay in despatch of the FIR.
11

. The same principle has been reiterated by this court in Alla China Apparao and Ors. v.
State of A.P.3wherein this court while construing the expression "forthwith" in Section
157 (1) of Code of Criminal Procedure observed that "it is a matter of common
experience that there has been tremendous rise in the crime resulting into enormous
volume of work, but increase in the police force has not been made in the same
proportion. In view of the aforesaid factors, the expression "forthwith" within the
meaning of Section 157(1) obviously cannot mean that the prosecution is required to
explain every hours delay in sending the first information report to the magistrate, of
course, the same has to be sent with reasonable despatch, which would obviously mean
within a reasonable possible time in the circumstances prevailing. Therefore, in our view,
the first information report was sent to the magistrate with reasonable promptitude and no
delay at all was caused in forwarding the same to the magistrate. In any view of the
matter, even if magistrates court was closed by and the first information report reached
him within six hours from the time of its lodgment, in view of the increase in work load,
we have no hesitation in saying that even in such a case it cannot be said that there was
any delay at all in forwarding the first information report to the magistrate." 2002
AIR SCW 4290

3 2002 (8) JT (SC) 167


12. It is not possible to lay down any universal rule as to within what time the special
report is required to be despatched by the Station House officer after recording the FIR.
Each case turns on its own facts.
13

. The learned senior counsel invited our attention to the judgments of this court in Balaka
Singh and ors. vs. State of Punjab4and Datar Singh vs. The State of Punjab5in which this
court highlighted the importance of despatch of special report to the Illaqua Magistrate.
There is no dispute with the proposition that it is the duty of the Station House Officer to
despatch Special Report to the Illaqua Magistrate as is required under Section 157(2) of
the Code of Criminal Procedure. But there may be variety of factors and circumstances
for the delay in despatch of the FIR and its receipt by the local Magistrate. The existence
of FIR and its time may become doubtful in cases where there is no satisfactory and
proper explanation from the investigating agencies. AIR 1975 SC 1193

4 AIR 1975 SC 1962


5 (1975) 4 SCC 272
14

. In Budh Singh and Ors. vs. State of UP6, this court while making reference of the
regulations made by the State of U.P. in terms of the U.P. Police Act held the regulations
to be statutory in nature. The regulations provide the procedure as to how and in what
form the information relating to commission of a cognizable offence when given to an
officer in-charge of a police station is to be recorded and sent to superior officers. The
regulations are procedural in nature which are meant for the guidance of the police. The
regulations do not supplant but supplement the provisions of Code of Criminal
Procedure. 2006 AIR SCW 2686

6 2006 (11) JT (SC) 503


15. We shall now consider the facts of the present case and apply the law declared by this
court in more than one decision.
16. It is in the evidence of Jaikirath Singh (P.W.1) that he rushed to the police station by a
bicycle and lodged written FIR Ext.Ka.1 within 1½ hours of the incident. The distance
between the place of occurrence and the police station is about 9 kms. It is in his evidence
that he took about 15-20 minutes to prepare his report and nobody advised him in
preparation of the report. He went to the police station all alone. We do not find any
reason whatsoever to disbelieve this version given by PW 1. There is nothing unnatural
and unusual in PW 1 stating the details of the incident in his written FIR Ext.Ka.1. The
behavioural pattern and response of individuals in a given situation may differ from
person to person. From a bare reading of the FIR Ext.Ka.1 we do not find anything
artificial in it. It cannot be said to be a contrived one brought into existence after due
deliberations as contended by the counsel for the appellant.
17. Be it noted, Jagdamba Prasad
@page-SC519
Dwivedi, PW 7, the officer in-charge of police station, Kothi having received the relevant
papers in village Sethmau, rushed to the place of occurrence and reached there at about
6.00 p.m. where he found the dead body of Ram Singh. The inquest report Ext.Ka.7 was
prepared on the spot and the body was sent for post-mortem examination. The Inquest
Report Ext.Ka.7 specifically refers to the lodging of FIR by PW 1 at 4.45 p.m. on
19.02.1977. The mere fact that crime number is not mentioned in the Inquest Report is of
no significance.
18. The sequence of events, namely, that Jagdamba Prasad Dwivedi -PW 7 reached the
scene of offence at 6.00 p.m. and prepared Inquest Report duly mentioning about lodging
of the FIR by PW 1 at 4.45 p.m. on 19th February, 1977 followed by despatch of the dead
body to the hospital which reached the hospital by 9.30 p.m. and the post-mortem
examination at 9.30 a.m. on 20th February, 1977 in clear and unequivocal terms reveal
that the FIR was lodged at the time it is stated to have been recorded. It cannot be treated
as an ante-timed and ante-dated one. It is required to note that 20th February, 1977 being
Sunday, the Illaqua Magistrate received special report on 21st February, 1977. The
special report was despatched by dak.
19. Arrest of one Maiku Bhujwa on 19th February, 1977 at 3.00 p.m. in Crime No.17
under Section 147 etc. and his being lodged in police station at about 5.30 p.m. by two
constables Ram Naresh and Ram Tool Misra as shown in Exts. Ka. 3 and 4 has been used
as a sheet anchor to challenge the time of FIR Ext.Ka.1 by saying that if the two
constables were summoned by Station Officer, on reaching the place of occurrence, then
in all probability Station Officer reached the place of occurrence by 3.00 p.m. even before
the FIR was issued.
20. The High Court adverting to this aspect of the matter observed "the investigating
officer Sri Dwivedi does not say that he arrested Maiku Bhujwa. Moreover, arrest of
Maiku was not in connection with the murder in question, but was in connection with
another case. Most importantly, what could have been the object behind delaying the time
of occurrence of reaching Sri Dwivedi, on the spot, has not been made clear by Sri
Kidwai. We are of the view that arrest of Maiku at about 3.00 p.m. and his lodging in
Hawalat at 5.30 p.m. by two constables, does not militate against the time of FIR Ext.Ka-
1 as shown in police papers. It is also possible that some manipulation was made in the
context of the arrest of Maiku, to make the case against him more sound".
21. We do not find any fallacy or error in the reasoning of the High Court. For the
aforesaid reasons we do not find any substance in the submission made by the learned
senior counsel about the ante-time and ante-dating of the FIR. The findings in this regard
as recorded by Sessions Judge as well as the High Court are supported by acceptable
evidence and there is no reason to take a different view. It is well settled that this court
normally does not reappreciate the evidence unless it is shown that the findings are
patently erroneous or perverse in nature. However, in order to satisfy ourselves we have
looked into the evidence of PWs 1,2,3 and 7 and we are satisfied that the FIR was lodged
on the date and time as stated by the prosecution.
22. The prosecution story entirely rests upon the direct evidence of PW Nos. 1, 2 and 3.
PW-1 is none other than the son of deceased Ram Singh. He was present in his fields
situated nearby the place of occurrence where his father was attacked. Jaikirat (PW-1) no
doubt was doing his part time G.N.S. in plantation at Lucknow but that itself would not
make his presence doubtful at the scene of offence on the fateful day. The defence did not
elicit anything in the cross-examination casting any doubt about the presence of PW-1 at
the scene of offence. There is nothing unnatural about the conduct of PW-1 at the scene
of occurrence. He gave detailed version as to the manner of assault and the role played by
each of the accused. The names of PW-2 and PW-3 were also mentioned as eye-witnesses
in the First Information Report itself. In the circumstances, PW-2 and PW-3 cannot be
treated as chance witnesses. The Trial Court and as well as the High Court did not
commit any error in relying on the testimony of PW-2 and PW-3 as eye-witnesses of the
occurrence which fully stands corroborated with the testimony of PW-1. Be that as it
may, there was not even a suggestion to PW-2 and PW-3 that they had animosity towards
the accused persons. They are independent witnesses and there is no reason for them to
speak against the accused.
23. However, it was strenuously urged that the presence of Jaikirat (PW-1) at the
@page-SC520
scene of offence is highly doubtful as he made no attempt whatsoever to save his father
from being further assaulted. We find no substance in this contention. It is in the evidence
of Jaikirat (PW-1) that all the four shots were fired in quick succession and at that
moment PW-1 was at some distance from the actual place of attack. Be it noted that at
least 2 accused were armed with fire-arms and one with lathi and they were using the
weapons with all impunity. In such circumstances, Jaikirat (PW-1) may not have
mustered his courage to jump into the fray and risk his own life. It is very difficult to
predict or express any opinion as to what could have been normal or natural conduct of a
person in such a situation. Response of individuals in such situations may differ from
person to person. It is not possible to reject the evidence or doubt the presence of PW-1
on that ground.
24. The post-mortem examination of the deceased Ram Singh was performed by
Dr.R.S.Katiyar (PW-5). The post-mortem report is exhibit Ka-4. The Medical Officer
found the following ante-mortem injuries on the person of the deceased:
1. A gun shot wound (wound of entry) 3 cm x 1 cm. over left side of face just above the
left side of the lower lip. Wound of Ext. 3 cm x 2 cm. over the right parietal bone, 7 cm.
Above the right ear.
2. A gun shot wound 2.5 cm x 1 cm. over the right side of face below max. prominence.
3. Multiple gun shot wounds in an area of 13 cm x 11 cm. over the right side of back
below the inferior angle of scapula.
4. A gun shot wound (wound of entry) 2 cm x 2 cm over the right side of the back 2 cm.
Right to 12th thoracic vertebra.
5. Multiple gun shot wounds in an area of 9 cm. X 4 cm. over the back and middle of
right arm.
25. Relying on his evidence the learned counsel for the appellant contended that the oral
account as given by PW-1, 2 and 3 is at variance with medical evidence available on
record. It is contended that while according to the eye-witnesses all the four shots were
fired from the gun, from right side of the victim, wound No.1 (wound of entry) was on
the left side of the face and caused by bullet and this evidence belies the claim of eye
witnesses that they saw the assault on Ram Singh. It is true that to a pointed query in
cross-examination as regards the nature of injury No. 1, the Medical Officer stated that
the said injury was caused by bullet only. The learned counsel contended that weapons in
the hands of the accused even according to PW-1 were of 12 bore guns and not any
pistols or revolvers. No bullet injury could have been caused with the fire-arms that were
alleged to be in the hands of the assailants. We find no substance in this submission. The
Medical Officer is not ballistic expert. He was not expected to answer as to whether
injury No. 1 could have been caused by bullet alone. His opinion to that extent is of no
consequence. It is well settled that medical evidence is only an evidence of opinion and it
is not conclusive and when oral evidence is found to be inconsistent with the medical
opinion, the question of relying upon one or the other would depend upon the facts and
circumstances of each case. No hard and fast rule can be laid down therefor. The ocular
evidence if otherwise is acceptable has to be given importance over medical opinion.
However, where the medical evidence totally improbabilises the ocular version the same
can be taken to be a factor to affect credibility of the prosecution version. We are not
inclined to place any reliance upon the opinion of the Medical Officer that the injury
No.1 could have been caused only with bullet since he is not a ballistic expert. This part
of the evidence of the Medical Officer cannot be considered to be the opinion of an
expert and the same has no evidentiary value. It is not possible to disbelieve the evidence
of PWs-1, 2 and 3 and their presence at the scene of occurrence based on the medical
evidence. The High Court rightly observed that the controversy as regards injury No. 1
and whether the same could have been caused by bullet or pellet to be without any basis.
26. The learned counsel for the State rightly contended that in case of attack by members
of un-lawful assembly on the victim in furtherance of common object, it is not necessary
for the prosecution to establish overt act done by each accused. It is required to be
noticed that Ram Smujh (A-1) who had fired two shots, convicted by the Sessions Court,
did not even challenge his conviction in the High Court. The appellants have been rightly
convicted under Section 302 read with aid of Section 149 of IPC. PW-5 in his evidence
stated that all the injuries sustained by the deceased were from gun. It is further stated
that from the body of
@page-SC521
deceased one bullet, one cover tikli, two dat and 40 'chare' shots were taken out, put in
packet and sealed........" It is also stated in his evidence that injuries caused on the body of
the deceased were sufficient in the normal course to cause death. This part of the medical
evidence if juxtaposed with the oral evidence of PWs-1, 2 and 3 it becomes unnecessary
to go into the question as to which accused caused what injury and which was a fatal one.
Once a membership of an unlawful assembly is established, it is not incumbent on the
prosecution to establish any specific overt act to any of the accused for fastening of
liability with the aid of section 149 of the IPC. Commission of overt act by each member
of the unlawful assembly is not necessary. The common object of the unlawful assembly
of the accused in the present case is evident from the fact that some of them were armed
with deadly weapons. None of them were curious onlookers or spectators to the macabre
drama that was enacted on 19.2.1977 at 3.30 p.m. at galiyara, village Badipur.
27. For the aforesaid reasons, we find no merit in this appeal. The appeal is accordingly
dismissed.
Appeal dismissed.
AIR 2008 SUPREME COURT 521 "Union of India v. State of U. P."
(From : 2001 All LJ 611)
Coram : 2 A. K. MATHUR AND MARKANDEY KATJU, JJ.
Civil Appeal No. 2549 of 2001, D/- 1 -11 -2007.
Union of India and Ors. v. State of U.P. and Ors.
Constitution of India, Art.285 - CESS - PROPERTY TAX - WATER TAX - Exemption of
property of Union from State taxation - Service charges for supply of water and
maintenance of sewerage system of Railway colonies as provided by Jal Sansthan - Is fee
and not tax - Not violative of Art. 285.
U.P. Water Supply and Sewerage Act (43 of 1975), S.52.
Service charges for supply of water and maintenance of sewarage system of Railway
colonies, as provided by Jal Sansthan cannot be said to be tax on the property of the
Union and it is fee. Hence it is not violative of Art. 285. So far as supply of water and
maintenance of sewerage is concerned, the Jal Sansthan is to maintain it and it is they
who bear all the expenses for the maintenance of sewerage and supply of water. It has to
create its own funds and therefore, levy under the Act is a must. In order to supply water
and maintain sewerage system, the Jal Sansthan has to incur the expenditure for the same.
It is in fact a service which is being rendered by the Jal Sansthan to the Railways, and the
Railways cannot take this service from the Jal Sansthan without paying the charges for
the same. Though the expression 'tax' has been used in the Act of 1975 but in fact it is in
the nature of a fee for the services rendered by the Jal Sansthan. Moreover what is
contemplated under Art. 285 is taxation on the property of the Union. It is a plain and
simple charge for service rendered by the Jal Sansthan for which the Jal Sansthan has to
maintain staff for regular supply of water as well as for sewerage system of the effluent
discharge by the railway over their platform or from their staff quarters.
(Paras 9, 23)
Cases Referred : Chronological Paras
2006 AIR SCW 4031 : AIR 2006 SC 2897 (Ref.) 20
2005 AIR SCW 256 : AIR 2005 SC 635 (Ref.) 19
2004 AIR SCW 466 : AIR 2004 SC 2912 (Foll.) 17
2004 AIR SCW 4665 : AIR 2004 SC 4499 (Ref.) 21
1997 AIR SCW 2851 : AIR 1997 SC 2847 (Disting.) 17, 22
(1996)7 SCC 542 (Disting.) 4, 16
1992 AIR SCW 1737 : AIR 1992 SC 1597 (Disting.) 4, 14, 16
AIR 1963 SC 1760 (Disting.) 10, 21
Shail Kumar Dwivedi, AAG (UP), T. S. Doabia, Sr. Advocates, Ms. Kiran Bhardwaj, Ms.
Asha G. Nair, Vishal Nayar, Manpreet Singh Doabia, R. C. Kathia, D. S. Mahra, Mrs.
Anil Katiyar, Rajesh, Wasim Ahmad Qadri, Manoj Kumar Dwivedi, G. Venkateswara
Rao, Ms. Chitra Markandaya, Vivek Vishnoi, Mukesh Verma, Manish Shanker, M. R.
Shamshad, Yash Pal Dhingra, for appearing parties.
Judgement
1. A. K. MATHUR, J. :- This appeal is directed against the judgment dated 12.12.2000
passed by the Division Bench of the Allahabad High Court whereby the Division Bench
has dismissed the writ petition filed by the appellants and upheld the recovery
proceedings initiated against the appellants for the demand raised by the Jal
@page-SC522
Sansthan, Allahabad as water and sewer charges.
2. The Union of India and two others filed a writ petition before the High Court of
Allahabad challenging the orders of recovery dated 1.7.1999 and 20.12.1999 issued by
the Executive Engineer, Jal Sansthan, Khusru Bagh, Allahabad on account of service
charges on Railway properties situated at Allahabad for the period from October, 1994 to
March, 1999. The appellants also challenged the recovery certificate issued by the
Tahasildar, Sadar, Allahabad for recovery of a sum of Rs.26,23,360/- from the appellant
No.2 i.e. the Divisional Railway Manager, Northern Railway, Allahabad. It was alleged
by the Jal Sansthan that the appellants were liable to pay the sewerage charges for 3125
seats at the rates notified under Allahabad Jal Sansthan Notification published in U.P.
Gazette dated 19.11.1994. The plea of the appellants was that they were holding the
property of the Central Government for which the service charges were not payable under
Article 285 of the Constitution of India as such charges were in the nature of a tax. It was
submitted that in view of the policy taken by the Ministry of Railways, Government of
India such charges cannot be recovered as this was totally exempted but the respondent
Jal Sansthan did not heed to it and they moved the Tahasildar, Sadar, Allahabad for
effecting recovery. Therefore, the appellants were constrained to file the present writ
petition before the High Court of Allahabad.
3. The writ petition was contested by the respondents and they filed their reply and
pointed out that in view of various circulars of the Ministry of Railways, the appellants
have been paying the service charges to the Jal Sansthan and in that connection it was
pointed out that other Central Government Offices situated in Allahabad i.e. Telephone
Department; Post Offices; Accountant General Office; Central Excise Department;
Income Tax Offices were all making regular payment of service charge and sewerage
charge to the Jal Sansthan, Allahabad. It was also pointed out that earlier the demand of
service charges was being paid by the Railway Administration to the Allahabad Nagar
Mahapalika but with the establishment of Allahabad Jal Sansthan under the U.P. Water
Supply and Sewerage Act, 1975 (hereinafter to be referred to as 'the Act') the aforesaid
charges were being levied and realized by the Allahabad Jal Sansthan.
4

. On the basis of these pleadings the question that came up before the Division Bench of
the High Court was whether such demand raised by Allahabad Jal Sansthan for the
services rendered by it to the Railway colonies was sustainable or not. The short question
was whether Article 285 of the Constitution of India will exempt the Railway
Administration from paying the water and sewerage charges under the Act of 1975. In
this connection, reference was specially made to two decisions of this Court i.e. Union of
India v. Purna Municipal Council and Ors. [(1992) 1 SCC 100] and Union of India and
Anr. v. Ranchi Municipal Corporation, Ranchi and Ors. [(1996) 7 SCC 542]. There is no
dispute that the bulk of water is supplied by the Jal Sansthan for maintenance of the
railway platforms as well as railway colonies and the Jal Sansthan is catering to the need
of maintaining the sewerage system not only at the railway stations but in the adjoining
areas and also the residential quarters, offices, godowns, shades are being maintained by
the Union of India through the Railways. The contention of the appellants in the writ
petition was that in view of the aforesaid two decisions of this Court the question is no
more res integra and the Jal Sansthan cannot charge for the supply of water and
maintenance of sewerage system. In this connection, Section 184 of the Railways Act,
1989 was also referred to which lays down that the railway administration shall not be
liable to pay any tax in aid of the funds of any authority unless the Central Government
by notification declares the railway administration to be liable to pay the tax specified in
such notification. In this connection, Clause (I) of Article 289 of the Constitution was
also pressed into service. But the High Court did not dwell on this aspect in absence of
the material placed in support thereof and did not permit to raise this plea. 1992 AIR
SCW 1737

5. As against this, it was contended on behalf of the respondents that the writ petitioner-
appellants herein were paying its predecessors the amount for water and sewerage
charges and there was no reason why they should discontinue the payment for the same.
However, it was contended by the appellants that merely because they were paying the
charges that does not become law or a vested right accrued in favour of the
@page-SC523
respondents to continue with the charges.
6. It was contended by the Jal Sansthan that the so called water and sewer charges is not a
tax and it is a fee for the services rendered by the Jal Sansthan. Hence the exemption
granted to the property of the Union from the State taxation under Article 285 of the
Constitution has no relevance to the present case as the property of the Union of India
was not being subjected to any tax. It was only a fee which has been charged for the
services rendered and this has been the practice which is prevalent since long as other
departments of the Central Government have been paying the same. In this background,
the Division Bench of the High Court after exhaustively dealing with several cases on the
subject came to the conclusion that in view of the provisions of the Act of 1975 and with
reference to Article 285 and Article 289 of the Constitution of India, consumption charges
on water or such services which are rendered under the statutory obligation for which the
Jal Sansthan is to maintain its own funds is a fee and not tax. Hence, the writ petitioners
were liable to pay such charges and they must honour the bills which have been served
upon them. It was also observed that the appellants have been uninterruptedly paying
such bills as a contractual obligation. It was also pointed out that the railway is not being
charged with any tax but what is being charged is a fee for the service rendered by the Jal
Sansthan. Aggrieved against this order passed by the Division Bench of the High Court,
the present appeal was filed by the appellants.
7. We have heard learned counsel for the parties and perused the record. One thing is very
clear from the facts, namely, that the Jal Sansthan which has been established under the
Act of 1975, has taken over certain duties of the Municipality i.e. supply of water and
maintenance of sewer. It is also not in dispute that prior to this, the railways were paying
for the services like water and sewer to the then Municipality and likewise other
departments of the Central Government are also paying the same charges. Therefore, the
question is whether the service charges like supply of water and sewerage can be said to
be a tax on the properties of the Railways.
8. Article 285 exempts the property of the Union from State taxation. Article 285 of the
Constitution reads as under :
"285. Exemption of property of the Union from State taxation.- (1) The property of the
Union shall, save in so far as Parliament may by law otherwise provide, be exempt from
all taxes imposed by a State or by any authority within a State.
(2) Nothing in clause (1) shall, until Parliament by law otherwise provides, prevent any
authority within a State from levying any tax on any property of the Union to which such
property was immediately before the commencement of this Constitution liable or treated
as liable, so long as that tax continues to be levied in that State."
9. From a perusal of Article 285 it is clear that no property of the Union of India shall be
subject to tax imposed by the State, save as Parliament may otherwise provide. The
question is whether 'the charges for' supply of water and maintenance of sewerage is in
the nature of a tax or a fee for the services rendered by the Jal Sansthan. There is a
distinction between a tax and a fee, and hence one has to see the nature of the levy
whether it is in the nature of tax or whether it is in the nature of fee for the services
rendered by any instrumentality of the State like the Jal Sansthan. There is no two
opinion in the matter that so far as supply of water and maintenance of sewerage is
concerned, the Jal Sansthan is to maintain it and it is they who bear all the expenses for
the maintenance of sewerage and supply of water. It has to create its own funds and
therefore, levy under the Act is a must. In order to supply water and maintain sewerage
system, the Jal Sansthan has to incur the expenditure for the same. It is in fact a service
which is being rendered by the Jal Sansthan to the Railways, and the Railways cannot
take this service from the Jal Sansthan without paying the charges for the same. Though
the expression tax has been used in the Act of 1975 but in fact it is in the nature of a fee
for the services rendered by the Jal Sansthan. What is contemplated under Article 285 is
taxation on the property of the Union. In our opinion the Jal Sansthan is not charging any
tax on the property of the Union; what is being charged is a fee for services rendered to
the Union through the Railways. Therefore, it is a plain and simple charge for service
rendered by the Jal Sansthan for which the Jal Sansthan has to maintain staff for regular
supply of water as well as for sewerage system of the effluent discharge by the railway
over their
@page-SC524
platform or from their staff quarters. It is in the nature of a fee for service rendered and
not any tax on the property of the Railways.
10. The distinction has to be kept in mind between a tax and a fee. Exemption under
Article 285 is on the levy of any tax on the property of the Union by the State, and
exemption is not for charges for the services rendered by the State or its instrumentality
which in reality amounts to a fee. In this connection, a reference was made to the decision
of this Court in Re : Sea Customs Act (1878), S.20(2) [AIR 1963 SC 1760]. This was a
case in which a reference was made by the President of India with regard to levy of
custom and excise duties on the State under Article 289 of the Constitution of India
wherein Sinha, CJ., Gajendragadkar, Wanchoo and Shah,JJ. answered the question at
paragraph 31 as follows :
"(31) For the reasons given above, it must be held that the immunity granted to the States
in respect of Union Taxation does not extend to duties of customs including export duties
or duties of excise. The answer to the three questions referred to us must, therefore, be in
the negative.
11. But a contrary view was taken by S.K.Das, Sarkar and Das Gupta,JJ. They concluded
in paragraph 71 as follows:
"(71) For the reasons given above our opinion is that the answers to the three questions
referred to this court must be in the affirmative and against the stand taken by the Union."
12. Hidayatullah, J. answering the question in paragraph 121, held as follows :
"(121) My answers to the questions are:
(1) The provisions of the Art. 289 of the Constitution preclude the Union from imposing
or authorizing the imposition of, customs duties on the import or export of the property of
a State used for purpose other than those specified in cl. (2) of that Article, if the
imposition is to raise revenue but not to regulate external trade.
(2) The provisions of Art. 289 of the Constitution of India preclude the Union from
imposing, or authorizing the imposition of excise duties on the production or manufacture
in India of the property of a State used for purposes other than those specified in cl.(2) of
that Article."
13. Ayyangar,J. has also expressed a separate opinion concurring with the Chief Justice.
This decision on reference of the President of India only dealt with the question of Article
289 of the Constitution and we are not concerned in the present case with the effect of
Article 289 which is, so far as the present controversy is concerned, of no useful
assistance.
14

. Learned counsel for the appellant has relied on the decision of this Court in Union of
India v Purna Municipal Council (supra). In this case, the Railways challenged the notice
of demand issued by Purna Municipal Council claiming Rs.28,400/- by way of 'service
charges' due for the period from 1954 to 1960. The Union of India made a reference to
Article 285 of the Constitution of India read with Section 135 of the Indian Railways Act,
1890. It is not clear from this decision whether the service charge demanded by the Purna
Municipal Council was in reality a tax on the property of the Union or a charge for some
service rendered, rather the decision proceeded on the assumption that it was a tax and
not a fee. The Court disposed of the matter holding as follows: 1992 AIR SCW 1737,
Para 5

"The interplay of the constitutional and legal provisions being well cut and well defined
requires no marked elaboration to stress the point. Accordingly, we allow this appeal, set
aside the judgment and order of the High Court and issue the writ and direction asked for
in favour of the Union of India restraining the respondent council from raising demands
on the railway in regard to service charges. We make it clear that the rights of the local
authority as flowing under Section 135 of the Indian Railways Act, 1890 stand preserved
in the event of the Central Government moving into the matter, if not already moved. In
the circumstances of the case, however, there will be no order as to costs."
15. From this it is not clear whether the impugned demand was a charge for some service
rendered, such as that which is involved in the present case with regard to water supply or
with regard to sewerage. As already pointed out, what is prohibited by Article 285 is
taxation on the property of the Railways and it does not prohibit charge of a fee on
account of some service rendered by the local bodies or instrumentality of the State like
supply of water or maintenance of sewerage. Such a charge would be in the nature of a
fee and not a tax.
16

. The other decision which has been 1992 AIR SCW 1737

@page-SC525
heavily relied on by the appellants in Ranchi Municipal Corporation, Ranchi and Ors.
(supra). In this case, their Lordships merely followed the decision in Purna Municipal
Council (supra) and disposed of the matter. Again the question is what was the nature of
the demand raised by the State against the Railways. In this case, their Lordships after
following the judgment in Purna Municipal Council (supra) observed as follows :
"Therefore, it cannot be construed that there is any contract between the Union of India
and the Municipality. In view of the fact that the Municipality has no right to demand
service charges from the Union of India, the demand made by the Municipality is clearly
ultra vires its power. It is true that earlier WP No.2844 of 1992 was filed and was
dismissed by the High Court and the special leave was refused by this Court on the
ground of gross delay."
It was also observed at paragraph 5 as follows :
"It is now settled law that the summary dismissal does not constitute res judicata for
deciding the controversy. Moreover, this being a recurring liability which is ultra vires the
power, earlier summary dismissal of the case does not operate as a res judicata."
17

. Therefore, from the perusal of these two decisions what emerges is that no property of
the Union of India can be subjected to State taxation, but these decisions do not deal with
a charge for services rendered by any State or an instrumentality of the State. In this
connection, our attention was invited to a decision of this Court in New Delhi Municipal
Council v. State of Punjab and Ors. [ (1997) 7 SCC 339]. This was also a case where
Articles 289, 246(4), 245(1) and 1(2), 3(b) and 285 came up for consideration. As per the
majority it was held that levy of property tax on such lands/buildings which are not used
or occupied for the purpose of any trade or business carried on by the State Government
with profit motive was invalid and incompetent by virtue of Article 289(1). But if the
levy is on lands/ buildings used or occupied for any trade or business carried on by or on
behalf of the State Governments, then by virtue of Article 289(2), the levy would be
valid. It was also observed that it was for the authorities under the enactments to
determine with notice to the affected State Governments, which land or building is used
or occupied for the purposes of any trade or business carried on by or on behalf of the
State Government. As against this, the minority view was that the States are entitled to
exemption from levy of property tax on their lands/ buildings situated within NCT
including those occupied for trade or business purposes. This case also does not throw
any light on the question whether the services which are being given by the State
Government or its instrumentality or the local bodies like supply of water and
maintenance of sewerage will have the exemption under Article 285 of the Constitution ?
This was also a case with regard to levy on the property of the State. So far as we are
concerned in the present case, there is no levy on the property of the Union of India.
Therefore, this case also does not provide us any useful assistance. As against this, our
attention was invited to a subsequent decision of this Court in Municipal Corporation,
Amritsar v. Senior Superintendent of Post Offices, Amritsar Division and Anr. [(2004) 3
SCC 92]. In this case, their Lordships were directly dealing with charges for the water
supply, street light, drainage services being rendered to P and T Department's buildings
situated within the Municipal limits. In that context, their Lordships held as follows :
1997 AIR SCW 2851
2004 AIR SCW 466, Para 7

"The demand so made was with regard to the services rendered to the respondents'
Department, like water supply, street-lighting, drainage and approach roads to the land
and buildings. In the counter, the respondents averred that they are paying for the services
rendered by the appellant Corporation by way of water and sewerage charges and power
charges separately. It is also categorically averred that no other specific services are being
provided to the respondents for which the tax in the shape of service charges can be
levied and realized from the respondents. There is no provision in the Municipal
Corporation Act for levying service charges. The only provision is by way of tax.
Undisputedly, the appellant Corporation is collecting the tax from general public for
water supply, street-lighting and approach roads etc. Thus, the "tax" was sought to be
imposed in the garb of "service charges". The interplay of the constitutional and legal
provisions being well cut and well defined, it was clearly not within the competence of
the Corporation to impose tax on the property of the Union of India, the same
@page-SC526
being violative of Article 285(1) of the Constitution."
18. In this case, what is clear is that in fact the P and T Department was paying for
water supply and sewerage separately and it was over and above that some service
charges were levied under the garb of service charges which was exempted by the
Constitution. In the present case, what is being charged is in fact water supply and
sewerage. Therefore, so far as this part is concerned, it is affirmed by this Court in the
aforesaid decision. But what is not accepted was that over and above the charges for
supply of water and sewerage and power charges, the Municipal Corporation was levying
service charges which were not contemplated under the Municipal Corporation Act for
levying such service charges. Therefore, indirectly so far as demand for water supply,
sewerage was concerned, it was accepted by the P and T Department and they were
paying the same to the Municipal Corporation.
19

. Our attention was invited to another decision of this Court in Sona Chandi Oal
Committee and Ors. v. State of Maharashtra [(2005) 2 SCC 345]. In this case, the
question was whether levy of inspection fee for renewal of moneylender's licence was
valid or not. Their Lordships held that fee charged is regulatory in nature to further the
objects of the Act and it has nexus with services rendered to moneylenders. However, it
was observed that service to be rendered is not a condition precedent and there should be
reasonable relationship between levy of fee and services rendered and in that context,
their Lordships affirmed the validity of levy of fee under the Bombay Money-Lenders
Act, 1946. 2005 AIR SCW 256

20

. Our attention was also invited to a decision of this Court in Vijayalashmi Rice Mill and
Ors. v. Commercial Tax Officers, Palakol and Ors. [(2006) 6 SCC 763]. In this case, their
Lordships considered the distinction between fee, cesses and taxes. Their Lordships held
that ordinarily a tax generates general revenue not for any service rendered. However, the
nomenclature is not important. Sometimes a 'tax' may be in reality a fee, depending upon
its nature. It was observed that the earlier concept of fee has undergone a sea change and
rendering of some specific service to a particular payer of fee is no longer considered
necessary to sustain the levy of fee provided there is a broad and general correlationship
between the totality of the fee imposed and the totality of the expenses on the service
rendered. This discussion makes it clear that the distinction between a tax and a fee
remains, even though the concept of a fee has undergone a sea change. 2006 AIR
SCW 4031

21

. A reference was also made to another decision of this Court in Karya Palak Engineer,
CPWD, Bikaner v. Rajasthan Taxation Board, Ajmer and Ors. [(2004) 7 SCC 195]. In
this case, a three Judge Bench held that Article 285 which contemplates exemption of
Union property from State tax, does not extent to exemption from levy of indirect tax. In
this case, the question was exemption of sales tax in a works contract for erection of
barbed wire. CPWD in terms of the contract supplied the construction materials after
purchasing the same on payment of consideration and was adjusting the value of the
materials in the final bills of the contractor. The question was whether there was
immunity for the property of the Union from the State taxation under Article 285. Their
Lordships held that from the case law it is clear that the Union is not exempted from the
levy of indirect tax under Article 285. Their Lordships after examining the decision in
Re : Sea Customs Act (1878), S.20(2) (supra) in reference by a nine Judge Bench
observed that Article 285 is a mandate and not indirect tax such as sales tax. Their
Lordships concluded with reference to sales tax which reads as follows : 2004 AIR
SCW 4665, Para 15
AIR 1963 SC 1760

"We may in this connection contrast sales tax which is also imposed with reference to
goods sold, where the taxable event is the act of sale. Therefore, though both excise duty
and sales tax are levied with reference to goods, the two are very different imposts; in one
case the imposition is on the act of manufacture or production while in the other it is on
the fact of sale. In neither case therefore can it be said that the excise duty or sales tax is a
tax directly on the goods for in that event they will really become the same tax."
22

. The aforesaid decision came up for consideration in New Delhi Municipal Council
(supra). Their Lordships concluded at paragraph 16 as follows : 1997 AIR SCW 2851

@page-SC527
"From the above judgment of this Court, it is clear that the Union is not exempted from
the levy of indirect tax under Article 285 of the Constitution. The above discussion also
shows that reliance placed on the judgment of this Court in the case of New Delhi
Municipal Council by one of the learned counsel for the appellants is wholly
misconceived and is opposed to his contention with reference to Article 285 of the
Constitution."
23. Though these observations were in reference to Sales Tax Act but the reasoning
equally applies in this case also. In this case what is being charged is for service rendered
by the Jal Sansthan i.e. an instrumentality of the State under the Act of 1975. Section 52
of the Act states that the Jal Sansthan can levy tax, fee and charge for water supply and
for sewerage services rendered by it as water tax and sewerage tax at the rates mentioned
therein. Though the charge was loosely termed as 'tax' but as already mentioned before,
nomenclature is not important. In substance what is being charged is fee for the supply of
water as well as maintenance of the sewerage system. Therefore, in our opinion, such
service charges are a fee and cannot be said to be hit by Article 285 of the Constitution. In
this context it is to be made clear that what is exempted by Article 285 is a tax on the
property of the Union of India but not a charge for services which are being rendered in
the nature of water supply, for maintenance of sewerage system. Therefore, in our
opinion, the view taken by the Division Bench of the Allahabad High Court is correct that
the charge is a fee, being service charges for supply of water and maintenance of
sewerage system, which cannot be said to be tax on the property of the Union. Hence it is
not violative of the provisions of Article 285 of the Constitution.
24. As a result of our above discussion, we do not find any merit in this appeal and the
same is dismissed. There will be no order as to costs.
Appeal dismissed.
AIR 2008 SUPREME COURT 527 "Didigam Bikshapathi v. State of A. P."
(From : Andhra Pradesh)*
Coram : 2 Dr. A. PASAYAT AND TARUN CHATTERJEE, JJ.
Criminal Appeal No. 1643 of 2007 (arising out of SLP (Cri.) No. 2205 of 2006), D/- 29
-11 -2007.
Didigam Bikshapathi and Anr. v. State of A.P.
(A) Criminal P.C. (2 of 1974), S.482 - INHERENT POWERS - Inherent powers - Courts
have all such powers as are necessary to do right and to undo wrong in course of
administration of justice on principle that when the law gives a person anything it gives
him that without which it cannot exist. (Para 7)
(B) Criminal P.C. (2 of 1974), S.482 - INHERENT POWERS - HIGH COURT - Inherent
powers - Powers possessed by High Court are very wide - Requires great caution in its
exercise - Inherent power should not be exercised to stifle a legitimate prosecution.
(2005) 13 SCC 540, 2006 AIR SCW 2330, AIR 1992 SC 604, Relied on. (Paras 9, 10)
(C) Penal Code (45 of 1860), S.306 - Criminal P.C. (2 of 1974), S.482 - ABETMENT TO
SUICIDE - INHERENT POWERS - Abetment to commit suicide - Proceedings for -
Quashing of - Victim committed suicide having been insulted and humiliated by
utterances made by accused - Suicide note clearly referred to background in which victim
took extreme step of taking away his own life - Further, acts of accused-appellants and
roles played by them were also referred in suicide note - Prayer to quash proceedings is
liable to be rejected.
2005 AIR SCW 1326, Disting. (Paras 11, 12)
Cases Referred : Chronological Paras
2006 AIR SCW 2330 : AIR 2006 SC 1937 : 2006 Cri LJ 2468 (Rel. on) 10
2005 AIR SCW 1326 : AIR 2005 SC 1775 : 2005 Cri LJ 1737 (Disting Pnt. C) 5, 11
(2005) 13 SCC 540 (Rel. on) 10
AIR 1992 SC 604 : 1992 Cri LJ 527 (Rel. on) 9
AIR 1960 SC 866 : 1960 Cri LJ 1239 (Rel. on, Pnt. B) 8
G. V. Choudhari and K. Shivraj Choudhuri, for Appellants; P. Vinay Kumar and Mrs. D.
Bharathi Reddy, for Respondent.
@page-SC528

* Cri. Petn. No. 2758 of 2002, D/- 29-3-2006 (AP).


Judgement
1. Dr. ARIJIT PASAYAT, J.:-Leave granted.
2. Challenge in this appeal is to the judgment rendered by a learned Single Judge of the
Andhra Pradesh High Court, dismissing the petition filed by the appellants under Section
482 of the Code of Criminal Procedure, 1973 (for short 'the Code'). Prayer was to quash
the proceedings in SC No.498 of 2001 on the file of VII Additional Metropolitan
Sessions Judge, Hyderabad, initiated against them for commission of offence punishable
under Section 306 of the Indian Penal Code, 1860 (in short 'IPC').
3. Accusations which led to the institution of the proceedings are essentially are as
follows:
Budida Krishnamurthy (hereinafter referred to as the 'deceased') had close friendship with
the appellant (A1). About four years back he appointed deceased and others as field
officers in his finance firm namely; Uma Hire Purchase and Finance. While so, the
appellant No.1 joined as a partner in Kanaka Mahalaxmi Real Estate Ventures run by
Mekala Ravi and Mekala Venu. The deceased and two other field officers namely; Budida
Laxmaiah (L.W.7) and Thandra Mallaiah (L.W.8) sold about 15 plots in that group to
Kommaipalli villagers and collected various amounts from them and handed over the
same to the appellant No.1. As he did not pay the money to the Kanaka Mahalaxmi Real
Estate Ventures, the other partners did not register the plots in favour of the persons, who
paid the money to the deceased. Since the deceased demanded for registration of the plots
in favour of the prospective purchasers, he (appellant No.1) escaped with his family from
Jangaon and was staying at his in-laws house. The deceased went there and demanded
registration of the plots, but the appellants abused him in filthy language and the accused
neither registered the plots nor returned the amount. Due to the mental harassment and
unable to bear the pressure from the purchasers of the plots, the deceased committed
suicide by falling under an un-known train in the night of 17.4.2001 leaving a suicide
note narrating the reasons for his committing suicide.
4. Before the High Court the stand was that the ingredients necessary to constitute
offence under Section 306 IPC are absent. There is no element of abetment. The High
Court did not accept the contention taking note of the statement made in the suicide note.
The High Court felt that this was not a fit case where the jurisdiction under Section 482
of the Code is to be exercised.
5. In support of the appeal learned counsel for the appellant submitted that there was no
question of abetment. Merely because the person committed suicide having been insulted
and humiliated due to the comments or utterances made by the accused, that does not
constitute an offence punishable under Section 306 IPC. Therefore, the High Court ought
to have quashed the proceedings. Strong reliance was placed on a decision of this Court
in Netai Dutta v. State of West Bengal (2005 AIR SCW 1326). Further it was submitted
that there was only a vague reference to appellant No.2 wife of appellant No.1, and on
that score, the appeal deserves to be allowed so far as she is concerned.
6. In response, learned counsel for the respondent submitted that the suicide note clearly
refers to various acts of the appellants due to which the unfortunate step of committing
suicide was taken by the victim and in any event it is not a fit case where jurisdiction
under Section 482 is to be exercised.
7. Section 482 does not confer any new powers on the High Court. It only saves the
inherent power which the Court possessed before the enactment of the Code. It envisages
three circumstances under which the inherent jurisdiction may be exercised, namely, (i) to
give effect to an order under the Code (ii) to prevent abuse of the process of court, and
(iii) to otherwise secure the ends of justice. It is neither possible nor desirable to lay down
any inflexible rule which would govern the exercise of inherent jurisdiction. No
legislative enactment dealing with procedure can provide for all cases that may possibly
arise. Courts, therefore, have inherent powers apart from express provisions of law which
are necessary for proper discharge of functions and duties imposed upon them by law.
That is the doctrine which finds expression in the section which merely recognizes and
preserves inherent powers of the High Courts. All courts, whether civil or criminal
possess, in the absence of any express provision, as inherent in their constitution, all such
@page-SC529
powers as are necessary to do the right and to undo a wrong in course of administration
of justice on the principle "quando lex aliauid alicui concedit, concedere videtur et id sine
guo res ipsae esse non potest" (when the law gives a person anything it gives him that
without which it cannot exist). While exercising powers under the section, the court does
not function as a court of appeal or revision. Inherent jurisdiction under the section
though wide has to be exercised sparingly, carefully and with caution and only when such
exercise is justified by the tests specifically laid down in the section itself. It is to be
exercised ex debito justitiae to do real and substantial justice for the administration of
which alone courts exist. Authority of the court exists for advancement of justice and if
any attempt is made to abuse that authority so as to produce injustice, the court has power
to prevent abuse. It would be an abuse of process of the court, to allow any action which
would result in injustice and prevent promotion of justice, in exercise of the powers court
would be justified to quash any proceeding if it finds that initiation/continuance of it
amounts to 'abuse of the process of court or quashing of these proceedings would
otherwise serve the ends of justice. When no offence is disclosed by the report, the court
may examine the question of fact. When a report is sought to be quashed, it is permissible
to look into the materials to assess what the report has alleged and whether any offence is
made out even if the allegations are accepted in toto.
8. In R.P. Kapur v. State of Punjab AIR 1960 SC 866 this Court summarized some
categories of cases where inherent power can and should be exercised to quash the
proceedings.
(i) where it manifestly appears that there is a legal bar against the institution or
continuance e.g. want of sanction;
(ii) where the allegations in the first information report or complaint taken at its face
value and accepted in their entirety do not constitute the offence alleged;
(iii) where the allegations constitute an offence, but there is no legal evidence adduced or
the evidence adduced clearly or manifestly fails to prove the charge.
9

. In dealing with the last category, it is important to bear in mind the distinction between a
case where there is no legal evidence or where there is evidence which is clearly
inconsistent with the accusations made, and a case where there is legal evidence which,
on appreciation, may or may not support the accusations. When exercising jurisdiction
under Section 482 of the Code the High Court would not ordinarily embark upon an
enquiry whether the evidence in question is reliable or not or whether on a reasonable
appreciation of it accusation would not be sustained. That is the function of the trial
Judge. Judicial process should not be an instrument of oppression, or, needless
harassment. Court should be circumspect and judicious in exercising discretion and
should take all relevant facts and circumstances into consideration before issuing process,
lest it would be an instrument in the hands of a private complainant to unleash vendetta to
harass any person needlessly. At the same time the section is not an instrument handed
over to an accused to short-circuit a prosecution and bring about its sudden death. The
scope of exercise of power under Section 482 of the Code. and the categories of cases
where the High Court may exercise its power under it relating to cognizable offences to
prevent abuse of process of any court or otherwise to secure the ends of justice were set
out in some detail by this Court in State of Haryana v. Bhajan Lal (1992 Supp (1) SCC
335). A note of caution was, however, added that the power should be exercised sparingly
and that too in rarest of rare cases. The illustrative categories indicated by this Court are
as follows: AIR 1992 SC 604
"(1) Where the allegations made in the first information report or the complaint, even if
they are taken at their face value and accepted in their entirety do not prima facie
constitute any offence or make out a case against the accused.
(2) Where the allegations in the first information report and other materials, if any,
accompanying the FIR do not disclose a cognizable offence, justifying an investigation
by police officers under Section 156 (1) of the Code except under an order of a
Magistrate within the purview of Section 155 (2) of the Code.
(3) Where the uncontroverted allegations made in the FIR or complaint and the evidence
collected in support of the same do not disclose the commission of any offence and make
out a case against the accused.
(4) Where the allegations in the FIR do
@page-SC530
not constitute a cognizable offence but constitute only a non-cognizable offence, no
investigation is permitted by a police officer without an order of a Magistrate as
contemplated under Section 155 (2) of the Code.
(5) Where the allegations made in the FIR or "complaint are so absurd and inherently
improbable on the basis of which no prudent person can ever reach a just conclusion that
there is sufficient ground for proceeding against the accused.
(6) Where there is an express legal bar engrafted in any of the provisions of the Code or
the Act concerned (under which a criminal proceeding is instituted) to the institution and
continuance of the proceedings and/or where there is a specific provision in the Code or
Act concerned, providing efficacious redress for the grievance of the aggrieved party.
(7) Where a criminal proceeding is manifestly attended with mala fide and/or where the
proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on
the accused and with a view to spite him due to private and personal grudge."
10

. As noted above, the powers possessed by the High Court under Section 482 of the Code
are very wide and the very plenitude of the power requires great caution in its exercise.
Court must be careful to see that its decision in exercise of this power is based on sound
principles. The inherent power should not be exercised to stifle a legitimate prosecution.
The High Court being the highest court of a State should normally refrain from giving a
prima facie decision in a case where the entire facts are incomplete and hazy, more so
when the evidence has not been collected and produced before the Court and the issues
involved, whether factual or legal, are of magnitude and cannot be seen in their true
perspective without sufficient material. Of course, no hard and fast rule can be laid down
in regard to cases in which the High Court will exercise its extraordinary jurisdiction of
quashing the proceeding at any stage.( See State of Orissa v. Saroj Kumar Sahoo (2005)
13 SCC 540 and Minu Kumari v. State of Bihar AIR 2006 SC 1937). 2006 AIR
SCW 2330

11

. The suicide note clearly refers to the background in which the victim took the extreme
step of taking away his own life by committing suicide. It is not a case where there is no
reference to any act by the accused. In Netai Dutta's case (supra) para 6 it was observed
as follows: 2005 AIR SCW 1326

"6. In the suicide note, except referring to the name of the appellant at two places, there is
no reference of any act or incidence whereby the appellant herein is alleged to have
committed any wilful act or omission or intentionally aided or instigated the deceased
Pranab Kumar Nag in committing the act of suicide. There is no case that the appellant
has played any part or any role in any conspiracy, which ultimately instigated or resulted
in the commission of suicide by deceased Pranab Kumar Nag."
12. In the instant case the suicide note clearly refers to the acts of the accused-appellants
and the roles played by them. Therefore, the High Court rightly rejected the prayer of
exercise of power under Section 482 of the Code. We make it clear that any observation
made by the High Court and by us while dismissing of the present appeal shall be
construed to be determinative factor in the trial.
Appeal dismissed.
AIR 2008 SUPREME COURT 530 "Chaturbhuj v. Sita Bai"
(From : Madhya Pradesh)*
Coram : 2 Dr. A. PASAYAT AND AFTAB ALAM, JJ.
Criminal Appeal No. 1627 of 2007 (arising out of SLP (Cri.) No. 4379 of 2006), D/- 27
-11 -2007.
Chaturbhuj v. Sita Bai.
Criminal P.C. (2 of 1974), S.125 - MAINTENANCE - WORDS AND PHRASES -
Maintenance - Claim by deserted wife - Wife earning some income - Does not disentitle
her - Phrase "unable to maintain herself" - Means unable to maintain herself in way she
was living with her husband.
The respondent had filed an application under Section 125 of Cr.P.C. claiming
maintenance from the appellant. The appellant and the respondent had entered into
marital knot about four decades back and for more than two decades they were living
separately. In the application it was claimed by respondent that she was unemployed and
unable to maintain herself. The object of the maintenance proceedings is not to punish a
person for his past neglect, but to prevent
@page-SC531
vagrancy by compelling those who can provide support to those who are unable to
support themselves and who have a moral claim to support. The phrase "unable to
maintain herself" would mean that means available to the deserted wife while she was
living with her husband and would not take within itself the efforts made by the wife after
desertion to survive somehow. Under the law the burden is placed in the first place upon
the wife to show that the means of her husband are sufficient. There is no dispute that the
appellant has the requisite means. But there is an inseparable condition which has also to
be satisfied that the wife was unable to maintain herself. These two conditions are in
addition to the requirement that the husband must have neglected or refused to maintain
his wife. The appellant has placed material to show that the respondent-wife was earning
some income. That is not sufficient to rule out application of Section 125. It has to be
established that with the amount she earned the respondent-wife was able to maintain
herself. Whether the deserted wife was unable to maintain herself, has to be decided on
the basis of the material placed on record. Where the personal income of the wife is
insufficient, she can claim maintenance under Section 125. The test is whether the wife is
in a position to maintain herself in the way she was used to in the place of her husband.
The conclusions of Courts that respondent-wife unable to maintain herself was factual
and cannot be interfered with in absence of perversity.
AIR 1978 SC 1807, 2005 AIR SCW 1601, AIR 1975 SC 83, Relied on.
(Paras 5, 7, 8, 9)
Cases Referred : Chronological Paras
2005 AIR SCW 1601 : AIR 2005 SC 1809 : 2005 Cri LJ 1241 (Rel. on) 5
AIR 1978 SC 1807 : 1979 Cri LJ 3 (Rel. on) 5
AIR 1975 SC 83 : 1975 Cri LJ 40 (Rel. on) 8
Shashindra Tripathi, Mrs. Sharad Tripathi and Debasis Misra, for Appellant; Shashi
Bhushan Kumar, for Respondent.
* Misc. Cri. Case No. 1385 of 2006, D/- 31-3-2006 (MP), (Indore Bench).
Judgement
Dr. ARIJIT PASAYAT, J.:- Leave granted.
2. Challenge in this appeal is to the order passed by a learned Single Judge of the
Madhya Pradesh High Court, Indore Bench, dismissing the revision petition filed by the
appellant in terms of Section 482 of the Code of Criminal Procedure, 1973 (in short
'Cr.P.C.'). The challenge before the High Court was to the order passed by learned
Judicial Magistrate, First Class, Neemuch, M.P. as affirmed by the learned Additional
Sessions Judge, Neemuch, M.P. The respondent had filed an application under Section
125 of Cr.P.C. claiming maintenance from the appellant. Undisputedly, the appellant and
the respondent had entered into marital knot about four decades back and for more than
two decades they were living separately. In the application it was claimed that she was
unemployed and unable to maintain herself. Appellant had retired from the post of
Assistant Director of Agriculture and was getting about Rs.8,000/- as pension and a
similar amount as house rent. Besides this, he was lending money to people on interest.
The appellant claimed Rs.10,000/- as maintenance. The stand of the appellant was that
the applicant was living in the house constructed by the present appellant who had
purchased 7 bighas of land in Ratlam in the name of the applicant. She let out the house
on rent and since 1979 was residing with one of their sons. The applicant sold the
agricultural land on 13.3.2003. The sale proceeds were still with the applicant. The
appellant was getting pension of about Rs.5,700/- p.m. and was not getting any house rent
regularly. He was getting 2-3 thousand rupees per month. The plea that the appellant had
married another lady was denied. It was further submitted that the applicant at the
relevant point of time was staying in the house of the appellant and electricity and water
dues were being paid by him. The applicant can maintain herself from the money
received from the sale of agricultural land and rent. Considering the evidence on record,
the trial Court found that the applicant-respondent did not have sufficient means to
maintain herself.
3. Revision petition was filed by the present appellant. Challenge was to the direction to
pay Rs.1500/- p.m. by the trial Court. The stand was that the applicant was able to
maintain herself from her income was reiterated. The revisional court analysed the
evidence and held that the appellant's monthly income was more than Rs.10,000/- and the
amount received as rent by the respondent-claimant was not sufficient to maintain herself.
The revision was accordingly dismissed. The matter was further
@page-SC532
carried before the High Court by filing an application in terms of Section 482 Cr.P.C. The
High Court noticed that the conclusions have been arrived at on appreciation of evidence
and, therefore, there is no scope for any interference.
4. Section 125 Cr.P.C. reads as follows:
"125. (1) If any person having sufficient means neglects or refuses to maintain-
(a) his wife, unable to maintain herself, or
(b) his legitimate or illegitimate minor child, whether married or not, unable to maintain
itself, or
(c) his legitimate or illegitimate child (not being a married daughter) who has attained
majority, where such child is, by reason of any physical or mental abnormality or injury
unable to maintain itself, or
(d) his father or mother, unable to maintain himself or herself,
a Magistrate of the First Class may, upon proof of such neglect or refusal, order such
person to make a monthly allowance for the maintenance of his wife or such child, father
or mother, at such monthly rate not exceeding five hundred rupees in the whole, as such
Magistrate thinks fit, and to pay the same to such person as the Magistrate may from time
to time direct:
Provided that the Magistrate may order the father of a minor female child referred to in
clause (b) to make such allowance, until she attains her majority, if the Magistrate is
satisfied that the husband of such minor female child, if married, is not possessed of
sufficient means.
Explanation.- For the purposes of this Chapter,
(a) 'minor' means a person who, under the provisions of the Indian Majority Act, 1875 (9
of 1875), is deemed not to have attained his majority;
(b) 'wife' includes a woman who has been divorced by, or has obtained a divorce from,
her husband and has not remarried."
["(2) Any such allowance for the maintenance or interim maintenance and expenses of
proceeding shall be payable from the date of the order, or, if so ordered, from the date of
the application for maintenance or interim maintenance and expenses of proceeding, as
the case may be.";]
(3) If any person so ordered fails without sufficient cause to comply with the order, any
such Magistrate may, for every breach of the order, issue a warrant for levying the
amount due in the manner provided for levying fines, and may sentence such person, for
the whole, or any part of each month's allowance4 [allowance for the maintenance or the
interim maintenance and expenses of proceeding, as the case may be] remaining unpaid
after the execution of the warrant, to imprisonment for a term which may extend to one
month or until payment if sooner made:
Provided that no warrant shall be issued for the recovery of any amount due under this
section unless application be made to the Court to levy such amount within a period of
one year from the date on which it became due:
Provided further that if such person offers to maintain his wife on condition of her living
with him, and she refuses to live with him, such Magistrate may consider any grounds of
refusal stated by her, and may make an order under this section notwithstanding such
offer, if he is satisfied that there is just ground for so doing.
Explanation.- If a husband has contracted marriage with another woman or keeps a
mistress, it shall be considered to be just ground for his wife's refusal to live with him.
(4) No wife shall be entitled to receive an4 [allowance for the maintenance or the interim
maintenance and expenses of proceeding , as the case may be] from her husband under
this section if she is living in adultery, or if, without any sufficient reason, she refuses to
live with her, husband, or if they are living separately by mutual consent.
(5) On proof that any wife in whose favour an order has been made under this section is
living in adultery, or that without sufficient reason she refuses to live with her husband, or
that they are living separately by mutual consent, the Magistrate shall cancel the order."
5

. The object of the maintenance proceedings is not to punish a person for his past neglect,
but to prevent vagrancy by compelling those who can provide support to those who are
unable to support themselves and who have a moral claim to support. The phrase "unable
to maintain herself" in the instant case would mean that means available to the deserted
wife while she was living with her husband and would 2005 AIR SCW 1601

@page-SC533
not take within itself the efforts made by the wife after desertion to survive somehow.
Section 125 Cr.P.C. is a measure of social justice and is specially enacted to protect
women and children and as noted by this Court in Captain Ramesh Chander Kaushal v.
Mrs. Veena Kaushal and Ors. (AIR 1978 SC 1807) falls within constitutional sweep of
Article 15(3) reinforced by Article 39 of the Constitution of India, 1950 (in short the
'Constitution'). It is meant to achieve a social purpose. The object is to prevent vagrancy
and destitution. It provides a speedy remedy for the supply of food, clothing and shelter
to the deserted wife. It gives effect to fundamental rights and natural duties of a man to
maintain his wife, children and parents when they are unable to maintain themselves. The
aforesaid position was highlighted in Savitaben Somabhai Bhatiya v. State of Gujarat and
Ors. (2005 (2) Supreme 503).
6. Under the law the burden is placed in the first place upon the wife to show that the
means of her husband are sufficient. In the instant case there is no dispute that the
appellant has the requisite means.
7. But there is an inseparable condition which has also to be satisfied that the wife was
unable to maintain herself. These two conditions are in addition to the requirement that
the husband must have neglected or refused to maintain his wife. It has to be established
that the wife was unable to maintain herself. The appellant has placed material to show
that the respondent-wife was earning some income. That is not sufficient to rule out
application of Section 125 Cr.P.C. It has to be established that with the amount she earned
the respondent-wife was able to maintain herself.
8. In an illustrative case where wife was surviving by begging, would not amount to her
ability to maintain herself. It can also be not said that the wife has been capable of
earning but she was not making an effort to earn. Whether the deserted wife was unable
to maintain herself, has to be decided on the basis of the material placed on record.
Where the personal income of the wife is insufficient she can claim maintenance under
Section 125 Cr.P.C. The test is whether the wife is in a position to maintain herself in the
way she was used to in the place of her husband. In Bhagwan v. Kamla Devi (AIR 1975
SC 83) it was observed that the wife should be in a position to maintain standard of living
which is neither luxurious nor penurious but what is consistent with status of a family.
The expression "unable to maintain herself" does not mean that the wife must be
absolutely destitute before she can apply for maintenance under Section 125 Cr.P.C.
9. In the instant case the trial Court, the Revisional Court and the High Court have
analysed the evidence and held that the respondent wife was unable to maintain herself.
The conclusions are essentially factual and they are not perverse. That being so there is
no scope for interference in this appeal which is dismissed.
Appeal dismissed.
AIR 2008 SUPREME COURT 533 "Kapildeo Mandal v. State of Bihar"
(From : 2004 (22) East Cri C 345 Patna)
Coram : 2 PRAKASH PRABHAKAR NAOLEKAR AND D. K. JAIN, JJ.
Criminal Appeal Nos. 432-433 of 2005, D/- 29 -11 -2007.
Kapildeo Mandal and Ors. v. State of Bihar.
(A) Evidence Act (1 of 1872), S.3 - EVIDENCE - WITNESS - Eye-witness - Credibility
- Not to be judged merely on basis of his relationship with deceased and strained relation
with accused. (Para 8)
(B) Penal Code (45 of 1860), S.300 - Evidence Act (1 of 1872), S.3 -MURDER -
EVIDENCE - WITNESS - Murder - Allegation that accused persons caused fire arm
injuries to deceased and other family members - Eye-witnesses relatives of deceased -
Their relation with accused strained - Testimony that accused were identified in torch and
lantern light - But no lantern or torch seized by I. O. - Evidence of identification is thus
doubtful - Non-recovery of cartridges /pellets from house - Doctor also did not find any
fire arm injury on body of deceased - Medical evidence thus totally inconsistent with
ocular evidence - Evidence of eye-witnesses doubtful - Accused entitled to benefit of
doubt.
2004 (2) East Cri C 345 (Pat.), Reversed. (Paras 9, 10, 12)
(C) Evidence Act (1 of 1872), S.3 - EVIDENCE - Ocular evidence vis-a-vis medical
evidence - In case of variance between two ocular evidence to get primacy - But in case
of total inconsistency - Medical
@page-SC534
evidence assumes importance. (Para 11)
Cases Referred : Chronological Paras
2004 AIR SCW 5754 : AIR 2004 SC 5056 : 2004 Cri LJ 4973 (Rel. on, Pt. A) 8
2003 AIR SCW 2837 : AIR 2003 SC 3975 : 20033 Cri LJ 300 (Rel. on. Pt. C) 11
2003 AIR SCW 6731 : AIR 2004 SC 1053 : 2004 Cri LJ 640 (Rel. on, Pt. A) 8, 11
2002 AIR SCW 3442 : AIR 2002 SC 2945 : 2002 Cri LJ 4081 (Rel. on, Pt. A) 8
1994 AIR SCW 2298 : 1994 Cri LJ 3848 (Rel. on, Pt. C) 11
AIR 1988 SC 2154 : 1989 Cri LJ 288 (Rel. on, Pt. C) 11
AIR 1979 SC 1194 : 1979 Cri LJ 939 (Rel. on, Pt. C) 11
AIR 1965 SC 202 (Rel. on, Pt. A) 8
AIR 1953 SC 415 : 1953 Cri LJ 1761 (Rel. on, Pt. C) 11
S. B. Sanyal, Sunil Kumar, Sr. Advocates, Ranjan Mukherjee, Ms. Anita Kanungo,
Awanish Sinha and Himanshu Shekhar, with them for Appellants; Anukul Raj, Gopal
Singh and Rituraj Biswas, for Respondent.
Judgement
1. P. P. NAOLEKAR, J.:-These appeals are directed against the judgment and order dated
16th April, 2004 of the High Court of Judicature at Patna passed in Criminal Appeal Nos.
646 of 1987 and 32 of 1988, whereby the appeals of the appellants were dismissed by the
High Court and their conviction and sentence was maintained.
2. Criminal Appeal No. 432 of 2005 by special leave was filed by accused No. 1
Kapildeo Mandal (A-1) and accused No. 5 Milan Mandal (A-5), whereas Criminal
Appeal No. 433 of 2005 by special leave was filed by accused No. 2 Dip Narain Mandal
(A-2), accused No. 3 Subhit Mandal (A-3) and accused No. 4 Pratap Mandal (A-4). After
the case was reserved for judgment by this Court, it was informed by the Registry of this
Court that A-3 Subhit Mandal S/o Chedi Mandal, fell seriously ill and was sent for
treatment to Jawaharlal Nehru Medical College and Hospital, Bhagalpur, and during the
course of treatment he died on 6th February, 2007. The appeal filed by A-3 is, therefore,
rendered infructuous.
3. All the accused persons were convicted by the 3rd Additional Sessions Judge,
Bhagalpur in Sessions Trial No. 34 of 1983 under Sections 302 read with Section149,
IPC and sentenced for imprisonment for life for having committed the offence of murder
of deceased Sitaram Mandal. The accused were also convicted under Sections 452 and
148, IPC. A-1 and A-4 were further convicted under Section 323, IPC. Two appeals
preferred by the accused against their conviction and sentence were dismissed by the
High Court and thus they are before us by special leave.
4. The incident took place in the night between 14th and 15th July, 1979. As per the
prosecution case as reported in the FIR by PW-9 Ramanand Mandal, at about 11.00 p.m.
he woke up after hearing the sound of barking dogs. A lantern was burning in the
verandah of his house. He saw persons, namely, A-1 and his younger brother A?5
entering from the inner courtyard from the roof of his house. One of them went to the
southern side and opened the window from that side. A-2 and A-4 entered the house
along with some other persons. One person opened the main door on the eastern side. A-3
and 5-6 other persons entered from that door. A-3 was carrying gun, whereas A-1, A-2
and A-5 were carrying country-made pistols. Other persons were carrying swords and
lathis. They assaulted the inmate of the house. A-2 fired at Sitaram Mandal as a result of
which he was badly injured. A-3 Subhit Mandal ordered to kill PW-9 Ramanand Mandal,
upon which A-1 fired upon PW-9. A-1 assaulted PW-9 with the butt of a country-made
pistol on the head. One of the miscreants sprinkled kerosene oil of two bottles upon the
body of PW-6 Brahmadeo Mandal and made search of a match-box to set fire upon his
body. PW-5 Mahesh Mandal was assaulted with a lathi. While leaving, the miscreants
took away some articles from the house. On hearing a hue and cry, some villagers
reached the spot. The occurrence and the assault was due to a land dispute between the
parties. In the incident, because of the assault made, Sitaram Mandal died.
5. The prosecution examined PW-1 Madan Mandal who is not an eye-witness. He
reached the place of incident after the incident was over. He stated that when he reached
the place of incident PW-9 Ramanand Mandal informed him that the accused appellants
were the persons involved in the assault made on the deceased Sitaram Mandal and him.
He admitted that all this happened because of a land dispute between the family of
Ramanand and family of accused Dip Narain Mandal. His
@page-SC535
statement was recorded by the police after two days of the incident. PW-2 Jiten Rabidas
also reached the spot after the occurrence. He stated that when he enquired from PW-9
Ramanand Mandal, his brother and female members about the incident, they told that
they did not identify any person. They told him that after committing dacoity dacoits fled
away. PW-3 Adhiklal Mandal also reached the spot after the incident happened. He
admitted that there was enmity between the two families since before the occurrence as
they were litigating. PW-4 Tej Narayan Mandal reached the place of incident afterwards.
He stated that he was informed of the names of the accused appellants. He is a relation of
the complainant party. PW-5 Mahesh Mandal is one of the sons of the deceased. He
deposed that he saw the incident in the flash of a torch-light. Besides the torch light, a
lantern was also burning in the verandah. He identified the accused appellants and stated
that Subhit Mandal (A-3) was armed with a double barrel gun and Dip Narain Mandal
(A-2) with a country-made pistol. A-3 shot with a double barrel gun at his father Sitaram
Mandal. A-2 also fired with the pistol at his father. Pratap Mandal (A-4) hit him on the
head with a knife. He saw the miscreants injuring Ramanand Mandal (PW-9). Thereafter,
after collecting ornaments and clothes, they fled away. As per this witness, the deceased
Sitaram Mandal had received firearm injury and he received injury by a knife. His
statement was recorded after four days of the incident and he admitted that before giving
statement to the police he took advice from the family members about the occurrence and
then made a statement to the police. The witness stated that Subhit Mandal (A-3) put the
gun on the chest of his father and fired at him and Dip Narain Mandal (A-2) put the pistol
near the mouth of his father and fired with the pistol. The witness admitted that there was
a litigation between the families. The witness also stated that he did not give the torch to
the S.I. of Police nor did he produce that torch in the court. PW-6 Brahmadeo Mandal,
another son of the deceased, identified the accused appellants to be the miscreants. He
stated that Subhit Mandal (A-3) was armed with a double barrel gun; A-1, A-2 and A-5
were armed with pistols and A-4 was armed with a knife and a lathi. A-5 poured kerosene
oil on his body and asked for a match-box. It was stated by this witness that the
properties, ornaments, clothes, etc. were looted and taken away by the miscreants. He
saw that his uncle Ramanand had sustained injury. This witness admitted in cross-
examination that he did not see who assaulted his father Sitaram Mandal. The witness
admitted that there was a land dispute between the accused persons and the complainant
party. PW-7 Bimla Devi is wife of PW-9 Ramanand Mandal. She identified the accused
persons in the light of a lantern. She admitted that the accused persons whom she had
identified had covered their faces with gamochha but they had not tied turbans. PW-9
Ramanand Mandal identified all the accused persons and stated that A-3 was armed with
a gun, and A-1, A-2 and A-5 were armed with country-made pistols. A-2 shot at the
deceased. A-3 ordered A-1 to assault him and A-1 shot at him which missed.
6. CW-2 Shreedhar Choubey is the Investigating Officer who recorded the statements of
the witnesses examined by the prosecution. He stated that none of the witnesses produced
any blood-stained clothes before him. PW-5 Mahesh Mandal, son of the deceased, had
not given any list of articles stolen from his house: Neither PW-6 Brahmadeo Mandal told
him that A-1 took away ornaments and clothes. The pouring of kerosene oil on
Brahmadeo was not told to him by PW-7 Bimla Devi nor did she tell him about the
assault made on her. PW-7 did not inform him that she identified the accused persons in
the light of a lantern. During the investigation, he did not find any empty cartridges, burnt
cotton, burnt papers, wads or pellets inside the house or in the outer verandah.
7. CW-1 Dr. Ambroj Kumar Choudhury stated that on 16th July, 1979 he conducted post-
mortem examination on the body of Sitaram Mandal and found the following ante-
mortem injuries:
(i) Abraison 2 ½" x 1 ½" on just below the left eye.
(ii) One stitched wound on frontal bone. On cutting the stitches the dimension of the
wound was found to be ½" x ½" x bone deep. The margins were lacerated. On dissection
underlying tissues were infiltrated with blood and blot clots. On further dissection
fracture of frontal bone was detected.
(iii) One stitched wound just below the left ear. On cutting the stitches the dimension of
the wound was found to be
@page-SC536
1 ½" x ½" x bone deep. The margins were lacerated and the laceration of external pine of
left ear.
(iv) One stitched wound on the left side chin. On cutting the stitches the dimension of the
wound was found to be 1" x ½" x deep to the mouth cavity. On further dissection the
laceration of muscle and fracture of the left ramus of mandible was detected.
(v) One stitched wound on the right side of the chest in between 10th and 12th ribs. On
cutting the stitches the dimension of the wound was found to be ½" x ¼" x deep upto
abdominal cavity. The wound was incised and penetrating, the weapon after passing
through the skin, intercostal muscle adjoining nerve vessel entered into the right lobe of
the liver via right side of the diaphyram, right side of the peritoneal cavity was filled with
blood and the blood clots.
According to the doctor, injuries Nos. (i) and (iii) were simple and injuries Nos. (ii), (iv)
and (v) were grievous in nature. As per the doctor's evidence, injuries Nos. (i) to (iv) were
caused by hard blunt weapon and injury No. (v) was caused by sharp penetrating weapon.
As per the doctor's evidence, the death occurred due to shock and haemorrage on account
of the said injuries. In the cross-examination, the doctor admitted that he did not find any
indication of any firearm injury on the person of the deceased.
8. From the evidence of the witnesses examined by the prosecution, it is clear that there
was animosity between the side of the complainant and the accused persons. There was a
litigation between the parties and they did not have good relations. The witnesses Mahesh
Mandal (PW-5), Brahmadeo Mandal (PW-6), Bimla Devi (PW-7) (wife of the informant)
and the informant Ramanand Mandal (PW-9), are closely related to the deceased. At the
same time, their presence in the house where the incident took place at 11.00 o'clock at
night cannot be doubted. Other witnesses who were examined by the prosecution had
reached the spot after the incident had already taken place and they were not the eye-
witnesses to the incident. Now it is well settled by series of decisions of this Court that
while appreciating the evidence of the witnesses related to the deceased, having strained
relations with the accused party, their evidence cannot be discarded solely on that basis,
but the court is required to carefully scrutinize it and find out if there is scope for taking
view whereby the court can reach to the conclusion that it is a case of false implication.
The credibility of a witness cannot be judged merely on the basis of his close relation
with the deceased and as such cannot be a ground to discard his testimony, if it otherwise
inspires confidence and, particularly so, when it is corroborated by the evidence of
independent and injured witnesses. Speaking for a 5-Judge Bench in a celebrated
judgment, viz., Masalti and Ors. v. The State of Uttar Pradesh, AIR 1965 SC 202 (in para
14), P.B. Gajendragadkar, C.J. said:
"... There is no doubt that when a criminal Court has to appreciate evidence given by
witnesses who are partisan or interested, it has to be very careful in weighing such
evidence. Whether or not there are discrepancies in the evidence; whether or not evidence
strikes the Court as genuine; whether or not the story disclosed by the evidence is
probable, are all matters which must be taken into account. But it would, we think, be
unreasonable to contend that evidence given by witnesses should be discarded only on
the ground that it is evidence of partisan or interested witnesses. Often enough, where
factions prevail in villages and murders are committed as a result of enmity between such
factions, criminal Courts have to deal with evidence of a partisan type. The mechanical
rejection of such evidence on the sole ground that it is a partisan would invariably lead to
failure of justice. No hard and fast rule can be laid down as to how much evidence should
be appreciated. Judicial approach has to be cautious in dealing with such evidence; but
the plea that such evidence should be rejected because it is partisan cannot be accepted as
correct."

In Nallabothu Venkaiah v. State of A.P., (2002) 7 SCC 117 (in para 13), this Court held:
2002 AIR SCW 3442, Para 12

"... The test, in such circumstances, as correctly adopted by the trial court, is that if the
witnesses are interested, the same must be scrutinized with due care and caution in the
light of the medical evidence and other surrounding circumstances. Animosity is double-
edged sword and it can cut both sides. It can be a ground for false implication. It can also
be a ground for assault. ..."

In Ramanand Yadav v. Prabhunath Jha and Ors., (2003) 12 SCC 606 (in para 15), this
Court held :- 2003 AIR SCW 6731, Para 15

@page-SC537
"... But at the same time if the relatives or interested witnesses are examined, the court
has a duty to analyse the evidence with deeper scrutiny and then come to a conclusion as
to whether it has a ring of truth or there is reason for holding that the evidence is biased.
Whenever a plea is taken that the witness is partisan or had any hostility towards the
accused, foundation for the same has to be laid. ...".

In State of Himachal Pradesh v. Mast Ram, AIR 2004 SC 5056 (in para 11), this Court
said:- 2004 AIR SCW 5754

"... The law on the point is well settled that the testimony of the relative witnesses cannot
be disbelieved on the ground of relationship. The only main requirement is to examine
their testimony with caution. . Their testimony was thrown out at the threshold on the
ground of animosity and relationship. This is not the requirement of Law....".
9. In the present case, we find from the evidence of the witnesses examined by the
prosecution as already noticed that the witnesses are related and their relations were
strained with the appellants on account of the litigation. The incident happened at 11.00
o'clock in the night. The witnesses have stated that they have seen the incident and
recognised the appellants either in the torch-light or in the lantern-light which was
burning at their house. It has come in evidence of the witnesses as well as the
Investigating Officer that neither the torch or the lantern was seized by the I.O. during the
course of investigation nor was it produced before the court. In the circumstances, it is
difficult to believe that the appellants have been identified in the torch-light or in the
lantern-light. One of the witnesses Jiten Rabidas (PW-2), who is related to the deceased
and reached the place of occurrence immediately after the incident of dacoity, said that
when he made enquiries from Ramanand Mandal (PW-9), who lodged the FIR, his
brother, and other female members, they specifically told him that they did not identify
the persons who had committed the dacoity in the house. Family members told that after
committing dacoity, they fled away. PW-7 Bimla Devi, wife of Ramanand Mandal, has
stated that the persons who had committed dacoity at their residence had tied gamochha
on their faces. All the eye-witnesses have categorically stated that guns and country-made
pistols were used by the accused-appellants in commission of the crime. Shreedhar
Choubey (CW-2), who was Investigating Officer, has deposed that he did not find any
empty cartridge, burnt cotton, burnt paper, pellets inside the house or in the outer
verandah and so long he was investigating the case, no bullets or pellets were received at
the police station from the hospital. Therefore, it is clear that he has not seized any
pellets, cartridges or bullets from the place of incident. There is no evidence on record
that either the gun or the country-made pistols were recovered from the accused-
appellants by the I.O. The statement of Dr. A.K. Choudhury (CW-1) indicates that the
doctor did not find any pellet or cartridge from the body of the deceased in post-mortem.
That apart, it is the case of the prosecution that Ramanand Mandal (PW-9) received
injury on the head. He was examined by the doctor but no medical evidence was
produced by the prosecution to prove the injury on the person of PW-9.
10. On the face of the evidence led by the prosecution, the medical evidence of the
injuries sustained by the deceased in this case assumes significant importance. All the
eye-witnesses have categorically stated that the deceased was injured by the use of
firearm, whereas the medical evidence given by Dr. A.K. Choudhury (CW-1) specifically
indicates that no firearm injuries were found on the person of the deceased. The doctor
has stated: "I did not find any indication of any firearm injury on the person of the
deceased. No pellets, bullets or any cartridge were found by me in any of the wounds
found by me."
11

. It is now well settled by series of decisions of this Court that while appreciating
variance between medical evidence and ocular evidence, oral evidence of eye-witness has
to get primacy as medical evidence is basically opinionative. [See Mange v. State of
Haryana (1979) 4 SCC 349 (conviction based on sole testimony of eye-witness); State of
U.P. v. Krishna Gopal and Anr., (1988) 4 SCC 302 (in para 24); and Ramanand Yadav v.
Prabhu Nath Jha and Ors., (2003) 12 SCC 606 (in para 17)]. But when the court finds
inconsistency in the evidence given by the eye-witnesses which is totally inconsistent to
that given by the medical experts, then evidence is appreciated in different perspective by
the AIR 1979 SC 1194
AIR 1988 SC 2154
2003 AIR SCW 6731, Para 17
AIR 1953 SC 415, Para 10

@page-SC538
courts. In Mohinder Singh v. The State, (1950) SCR 821 (at page 828), this Court said:-
"... In a case where death is due to injuries or wounds caused by a lethal weapon, it has
always been considered to be the duty of the prosecution to prove by expert evidence that
it was likely or at least possible for the injuries to have been caused with the weapon with
which and in the manner in which they are alleged to have been caused. It is elementary
that where the prosecution has a definite or positive case, it must prove the whole of that
case. In the present case, it is doubtful whether the injuries which are attributed to the
appellant were caused by a gun or by a rifle. Indeed, it seems more likely that they were
caused by a rifle than by a gun, and yet the case for the prosecution is that the appellant
was armed with a gun and, in his examination, it was definitely put to him that he was
armed with the gun P.16. It is only by the evidence of a duly qualified expert that it could
have been ascertained whether the injuries attributed to the appellant were caused by a
gun or by a rifle and such evidence alone could settle the controversy as to whether they
could possibly have been caused by a firearm being used at such a close range as is
suggested in the evidence. ...."

In Mani Ram and Ors. v. State of U.P., 1994 Supp(2) SCC 289 (in para 9), this Court
held: 1994 AIR SCW 2298, Para 10

"... It is well settled by long series of decisions of this Court that where the direct
evidence is not supported by the expert evidence then the evidence is wanting in the most
material part of the prosecution case and, therefore, it would be difficult to convict the
accused on the basis of such evidence. If the evidence of the prosecution witnesses is
totally inconsistent with the medical evidence this is a most fundamental defect in the
prosecution case and unless this inconsistency is reasonably explained it is sufficient not
only to discredit the evidence but the entire case. ...".

In another case of Thaman Kumar v. State of Union Territory of Chandigarh, AIR 2003
SC 3975 (in para 16), this Court held: 2003 AIR SCW 2837

"The conflict between oral testimony and medical evidence can be of varied dimensions
and shapes. There may be a case where there is total absence of injuries which are
normally caused by a particular weapon. There is another category where though the
injuries found on the victim are of the type which are possible by the weapon of assault,
but the size and dimension of the injuries do not exactly tally with the size and dimension
of the weapon. The third category can be where the injuries found on the victim are such
which are normally caused by the weapon of assault but they are not found on that
portion of the body where they are deposed to have been caused by the eye-witnesses.
The same kind of inference cannot be drawn in the three categories of apparent conflict in
oral and medical evidence enumerated above. In the first category it may legitimately be
inferred that the oral evidence regarding assault having been made from a particular
weapon is not truthful. However, in the second and third category no such inference can
straightway be drawn. The manner and method of assault, the position of the victim, the
resistance offered by him, the opportunity available to the witnesses to see the occurrence
like their distance, presence of light and many other similar factors will have to be taken
into consideration in judging the reliability of ocular testimony."
12. In the present case, the medical evidence is to the effect that there were no firearm
injuries on the body of the deceased, whereas the eye-witnesses' version is that the
accused-appellants were carrying firearms and the injuries were caused by the firearms.
In such a situation and circumstance, the medical evidence will assume importance while
appreciating the evidence led by the prosecution, by the court and will have priority over
the ocular version and can be used to repel the testimony of the eye-witnesses as it goes
to the root of the matter having an effect to repel conclusively the eye-witnesses' version
to be true. The medical evidence when specifically rules out the injury claimed to have
been inflicted as per the eye-witnesses' version, then the court can draw adverse inference
to the effect that the prosecution version as being put forth before the court, is not
trustworthy. In the present case, the medical evidence completely rules out the
prosecution version of the injuries being caused by firearms, coupled with the fact that no
evidence has been produced by the prosecution of any pellet or bullet being recovered
from the
@page-SC539
place of incident or from the body of the deceased in post-mortem. In the light of the fact
that there was a previous enmity between the parties and the eye-witnesses examined are
related to the deceased and are interested witnesses; and that in absence of the lantern or
the torch, in the light of which the incident was said to have been witnessed, the
prosecution case as placed before the court is full of doubts, and as such the accused-
appellants are entitled for benefit of doubt.
13. For the aforesaid reasons, the appeals are allowed. The judgment of the High Court
and that of the trial court are set aside. The accused-appellants are directed to be set at
liberty if they are not required in any other case.
Appeal allowed
AIR 2008 SUPREME COURT 539 "K. N. Anantharaja Gupta v. D. V. Usha Vijaykumar"
(From : Karnataka)*
Coram : 2 TARUN CHATTERJEE AND P. SATHASIVAM, JJ.
Civil Appeal No. 5547 of 2007 (arising out of SLP (C) No. 285 of 2007), D/- 30 -11
-2007.
K. N. Anantharaja Gupta v. D. V. Usha Vijaykumar.
Karnataka Rent Act (34 of 2001), S.27(2)(r) - HOUSES AND RENTS - EVICTION -
Eviction - Ground - Self occupation after reconstruction - Landlord alleging that she with
her children are residing in house of her father-in-law - Nothing to show that there was
any threat of eviction - Eviction order passed without considering whether landlord could
be said to be not in possession of reasonably suitable accommodation as also condition of
suit house - Liable to be set aside.
H. R. P. No. 366 of 2004, D/- 19-10-2006 (Kant), Reversed.(Para 5)

S. N. Bhat for Appellant; K. Maruthi Rao, Ms. K. Radha and Ms. Anjani Aiyagari for
Respondent.
* H. R. R. P. No. 366 of 2004, D/- 19-10-2006 (Kant)
Judgement
1. TARUN CHATTERJEE, J. :-Leave granted.
2. An eviction petition being HRC No. 233 of 2002 was filed before the Chief Judge,
Small Cause Court, Bangalore for eviction of the appellant from the residential premises
bearing No. 100, Surveyor Street, Bangalore-4 (in short "the suit premises") under
Section 27(2)(r) read with Section 31 of the Karnataka Rent Act (in short "the Act") on
the ground that since the suit premises is old and in a dilapidated condition, the same was
required to be demolished in order to put up a new construction and that the respondent
required the suit premises for use and occupation by herself and her children after
demolition and reconstruction of the same as she and her children were staying in her
father-in-law's house. It was also the case of the respondent that the appellant had been
residing in the suit premises for more than 20 years and therefore, he should find his own
suitable accommodation and accordingly, he was liable to be evicted.
3. A written statement was filed by the appellant in which the allegations made in the
eviction petition were denied and it was stated that the respondent was not entitled to
evict the appellant as she did not require the suit premises for her bona fide use and
occupation. It was further alleged in the written statement that since the respondent was
not the sole owner of the suit premises, the eviction petition filed at her instance only was
not maintainable and therefore, the same was liable to be dismissed. It was also alleged
that the condition of the suit premises was not so dilapidated for which demolition and
reconstruction was necessary. The chief Judge of the Small Cause Court, Bangalore by
his order dated 1st of April, 2004 dismissed the eviction petition of the respondent.
Aggrieved by the aforesaid order of the Chief Judge of the Small Cause Court at
Bangalore, the respondent filed a revision petition before the High Court of Karnataka at
Bangalore being H. R. R. P. No. 366 of 2004. The High Court by it's order dated 19th of
October, 2006, had set aside the order of the Chief Judge of the Small Cause Court
thereby allowing the revision petition and directing eviction of the appellant from the suit
premises but granted six months time to vacate and handover the possession of the same
to the respondent. It is this order of the High Court, which is now under challenge in this
Court by way of a special leave petition in respect of which leave has already been
granted.
@page-SC540
4. Heard the learned counsel for the parties and examined the impugned order of the High
Court as well as the order of the Small Cause Court and the other materials on record. In
our view, the High Court was not justified in reversing the judgment of the Small Cause
Court without being satisfied whether the respondent had fulfilled the conditions required
for eviction of the appellant as laid down under Section 27(2)(r) of the Act. Chapter 6 of
the Act deals with regulation of eviction. Section 27 of the Act deals with protection of
tenants against eviction. Sub-section (1) of Section 27 clearly says that notwitstanding
anything to the contrary contained in any other law or contract, no order or decree for the
recovery of possession of any premises shall be made in favour of the landlord save as
provided in sub-section (2) of Section 27. Sub-section (2) of Section 27 empowers the
Court, on an application made to it in the prescribed manner, to make an order for the
recovery of possession of the premises on one or more of the grounds enumerated
therein. Clause (r) of sub-section (2) of Section 27 being one such ground and involved in
present case runs as under :
"(r) that the premises let are required, whether in the same form or after re-construction
or re-building, by the landlord for occupation for himself or for any member of his family
if he is the owner thereof, or for any person for whose benefit the premises are held and
that the landlord or such person has no other reasonably suitable accommodation....."
We have examined this provision viz., Section 27(2)(r) of the Act in detail. After a careful
examination of this provision, we summarize as follows :
No order or decree for the recovery of possession of any premises shall be made by the
Court against the tenant, save as provided in Section 27(2). A plain reading of Section
27(2)(r) would clearly show that a decree for eviction or an order for recovery of
possession can be passed by a Court if the premises let is required, whether in the same
form or after reconstruction or rebuilding by the landlord for occupation for himself or
for any member of his family if:
(i) he is the owner of the said premises and
(ii) the landlord or such person has no other reasonably suitable accommodation. It is
only when the aforesaid conditions are satisfied the Court can pass an order or decree of
possession of the suit premises against the tenant. We have already noted that the eviction
petition of the respondent was dismissed by the Chief Judge, Small Cause Court,
Bangalore on the ground that the respondent had failed to prove that the suit premises
was required for use and occupation by herself and her children after demolition and
reconstruction and that the respondent had failed to prove that she and her children had
no other reasonably suitable accommodation. This finding as to bona fide requirement of
the respondent was reversed by the High Court in revision. Let us, therefore, examine
whether the High Court was justified in reversing the finding of the Chief Judge, Small
Cause Court, Bangalore and whether the conditions as required under Section 27(2)(r) of
the Act have been satisfied so as to evict the appellant from the suit premises. While
reversing the finding of the Chief Judge, Small Cause Court, Bangalore, so far as the
requirements of Section 27(2)(r) are concerned, the High Court made the following
findings:-
"It is also emerged on the face of it that the petitioner needs the accommodation for her
and her children and she needs to demolish and take up a construction and obtain plan
from the authority. This aspect of the matter has been overlooked by the Trial Court.
Therefore, I am of the considered view that the petitioner has made out a case. The
premises is required for her occupation to take up the construction and to give the same
for personal use by her children as the claim is bona fide."
Having found as quoted hereinabove, the High Court reversed the order of the Chief
Judge, Small Cause Court, Bangalore and held that the respondent was entitled to an
order of eviction under Section 27(2)(r) of the Act. As noted hereinabove, before an order
or decree for eviction is passed, the Court must be satisfied that the premises let is
required by the landlord for occupation for himself or for any member of his family, if he
is the owner of the same and the landlord or such person has no other reasonably suitable
accommodation. In the present case, the respondent is, admittedly, a co-owner of the suit
premises. It is well settled that a co-owner is entitled to evict a tenant on the ground of
bona fide requirement. However, this aspect need not be gone
@page-SC541
into in detail in view of the fact that the High Court had not recorded any finding on the
question whether the respondent was an owner or co-owner in respect of the suit
premises. Now, the question is whether the respondent and her children are in possession
of a reasonably suitable accommodation. According to the respondent, she has been
living with her children in the residence of her father-in-law. The question would,
therefore, be whether this accommodation could be said to be reasonably suitable
accommodation. Admittedly, from the record, it does not appear that there has been any
threat of eviction of the respondent and her children by her father-in-law from the house
in which they are presently residing. This aspect of the matter, we are afraid, was not
taken into consideration by the High Court. Before passing any order of eviction, it was
the duty of the High Court to come to a finding that the respondent was not in possession
of a reasonably suitable accommodation, which is the mandatory requirement under
Section 27(2)(r) of the Act.
5. That apart, there is another aspect of this matter. As noted hereinabove, the eviction of
the tenant was sought under Section 27(2)(r) of the Act by alleging that the suit premises
was required by the respondent and her children for their own use and occupation after
demolition and reconstruction of the building already existing. In order to satisfy this
condition, as enumerated in Section 27(2)(r) of the Act, it is essential that the Court
should also find that the premises let needs to be demolished and that the same would be
reconstructed after demolition. It is only after this that the question of user of the same
after reconstruction would be taken into consideration. From the order of the High court
passed in revision, it would be evident that the only ground on which the order of the
Chief Judge, Small Cause Court, Bangalore was reversed was that the respondent needed
the suit premises to demolish the same and to take up new construction and obtain plans
from the authority. In our view, before granting a decree for eviction on the ground of
demolition and reconstruction and then for use of the same for occupation, the Court
must be satisfied that :-
(i) the suit premises is so dilapidated that it needs demolition;
(ii) the landlord has the capacity to reconstruct the suit premises after demolition;
(iii) the sanctioned plan has to be taken from the concerned authority.
The High court proceeded only on the ground that the respondent required the suit
premises for occupation by herself and her children and needed to demolish and take up a
new construction on the same. In our view, this would not satisfy the requirements
envisaged in Section 27(2)(r) of the Act. The Court, as noted herein earlier, must be
satisfied that all the conditions, as enumerated above, have been satisfied by the landlord
by production of cogent evidence in respect of the same. Only an expression of desire
would not entitle the landlord to get a decree for eviction under Section 27(2)(r) of the
Act.
6. Another aspect involved in this case needs to be stated because the eviction petition
was filed not only under Section 27(2)(r) of the Act but also under Section 31 of the Act,
recourse to which is available to a widow only once. We, however, need not go into this
question at all. In any view of the matter, the High Court, while reversing the order of the
chief Judge, Small Cause Court, Bangalore had also not adhered to this aspect of the
matter and therefore, it is also not necessary for us to go into this question in this appeal.
7. For the reasons aforesaid, we are unable to sustain the order of the High Court and
accordingly, the impugned judgment of the High Court is set aside and the matter is
remitted back to the High Court for a decision in the light of the findings made
hereinabove. While deciding the revision petition, it will be open to the High Court either
to permit the parties to lead evidence in the High Court or to frame the questions and
direct the Chief Judge, Small Cause Court, Bangalore to take evidence and to make a
finding on the same, which may then be transmitted to the High Court and thereafter, the
High Court will decide the revision petition in the light of the finding, the evidence
adduced and the evidence already on record within a period of six months from the date
of supply of a copy of this order to it without granting any unnecessary adjournment to
either of the parties.
8. For the reasons aforesaid, the appeal is thus allowed to the extent indicated above.
There will be no order as to costs.
Appeal allowed.
@page-SC542
AIR 2008 SUPREME COURT 542 "Janak Raj v. Pardeep Kumar"
(From : Jammu and Kashmir)
Coram : 2 A. K. MATHUR AND MARKANDEY KATJU, JJ.
Civil Appeal No. 7080 of 2001, D/- 27 -11 -2007.
Janak Raj v. Pardeep Kumar.
J. and K. Houses and Shops Rent Control Act (34 of 1966), S.11(1)(i), S.12(3), Proviso -
HOUSES AND RENTS - EVICTION - APPLICABILITY OF AN ACT - TENANCY -
Eviction - Default in payment of rent - Protection to defaulting tenant not defaulting
thrice in 18 months - Applicability - Tenant defaulting thrice in 18 months - Depositing
certain sum thereafter - Sum deposited has to be adjusted chronologically - Cannot be
adjusted first to satisfy 2nd and 3rd default - Sum deposited by tenant falling short of rent
due towards first default - Tenant thus, has committed 3 defaults - Not entitled to
protection of S. 12 (3) Proviso.
Civil S. A. No. 4 of 1995, D/- 9-11-2000 (J. and K.), Reversed. (Paras 7, 8, 9, 10)

P. S. Patwalia, Sr. Advocate, Purnima Bhat, for Appellant; Subramonium Prasad, for
Respondent.
Judgement
JUDGMENT :- We have heard learned counsel for the parties.
2. This appeal by special leave is directed against the impugned judgment and order of
the learned single Judge of the High Court of Jammu and Kashmir at Jammu dated 9th
November, 2000 in Civil Second Appeal No. 4 of 1995 whereby the learned single Judge
upheld the finding of the First Appellate Court and dismissed the suit of the plaintiff
(appellant herein).
3. The brief facts which are necessary for the disposal of the appeal are that a suit was
filed by the landlord (appellant herein) for eviction of the tenant respondent. The landlord
claimed the rent for January, 1984 to January, 1985 by sending a notice dated 27-2-1985
to the tenant. Thereafter the tenant committed a second default of payment of rent for
February, 1985 and March, 1985. The third default was committed in April, 1985 and
May, 1985. The total amount deposited by the tenant on 25-5-1995 was Rs. 6,000/-.
4. Section 11(1)(i) of the Jammu and Kashmir Houses and Shops Rent Control Act, 1966
provides that if two months rent is not paid by the tenant within the period specified
therein the tenant will be liable for eviction, provided that the landlord has served a notice
on the tenant calling upon him to pay the arrears of rent, and the arrears are not paid
within 30 days of service of the notice.
5. Section 11(1)(i) is however subject to Section 12 of the Act which reads as under:-
"12. When a tenant can get the benefit of protection against eviction. (1) If in a suit for
recovery of possession of any house or shop from the tenant the landlord would not get a
decree for possession but for clause (i) of the proviso to sub-section (1) of Section 11, the
court shall determine the amount of rent legally payable by the tenant and which is in
arrears taking into consideration any order made under sub-section (4) and effect thereof
up to the date of the order mentioned hereafter, as also the amount of interest on such
arrears of rent calculated at the rate of nine and three eighths per centum per annum from
the day when the rent became arrears up to such date, together with the amount of such
cost of the suit as if fairly allowable to the plaintiff landlord, and shall make an order on
the tenant for paying the aggregate of the amounts (specifying in the order such aggregate
sum) on or before a date fixed in the order.
(2) Such date fixed for payment shall be the fifteenth day from the date of the order,
excluding the day of the order.
(3) If, within the time fixed in the order under Sub-section (1), the tenant deposits in the
Court the sum specified in the said order, the suit, so far as it is a suit for recovery of
possession of the house or shop, shall be dismissed by the Court. In default of such
payment the Court shall proceed with the hearing of the suit:
Provided that the tenant shall not be entitled to the benefit of protection against eviction
under this section, if, notwithstanding the receipt of notice under proviso to clause (i) of
the proviso to sub-section (1) of Section 11, he makes a default in the payment of the rent
referred to in clause (i) of the proviso to sub-section (1) of Section 11 on three occasions
within a period of eighteen months.
6. In our opinion, in view of the proviso to Section 12(3) referred to above, the
respondent tenant cannot get the benefit of
@page-SC543
Section 12.
7. In the present case, it is the admitted position that the rent was Rs. 500/- per month.
The respondent tenant was in default in not paying the rent from January, 1984 to
January, 1985 (inclusive) but he is alleged to have deposited a sum of Rs. 6,000/- on 25-
5-1985 whereas the rent for this period was Rs. 6,500/- i.e. the rent paid was short by Rs.
500/-. As such, in our opinion he is a defaulter for this period. Part payment of rent in our
opinion makes the tenant a defaulter, for he has to make full payment. The second default
committed by the respondent tenant was in February, 1985 and March, 1985, and the
third default committed by him was in April, 1985 and May, 1985. Therefore, he is a
defaulter three times during the period of eighteen months. As such, he is not entitled to
the protection of Section 12.
8. Unfortunately, the courts below have taken the amount of Rs. 6,000/- deposited by the
respondent tenant as rent towards February, 1985 and March, 1985; and April, 1985 and
May, 1985 to take him out of the defaulters clause but this view taken by the Courts
below cannot be countenanced. As a matter of fact he had deposited a sum of Rs. 6,000/-
for the aforesaid three defaults. That sum cannot be adjusted against the second and third
defaults as has been done by the Courts below.
9. The tenant is firstly supposed to clear the first default i.e. from 1984 to 1985, then the
second default of February and March, 1985 and then the third default of April and May,
1985. One has to proceed chronologically in the matter. The sum of Rs. 6,000/- has to be
first treated as part payment against the rent from January, 1984 to January, 1985.
However, for the rent from January, 1984 to January, 1985 the total amount deposited by
the tenant was Rs. 6,000/- which is short of the total rent due for this period by Rs. 500/-.
Therefore, it will also be treated to be a default. Consequently, this default, coupled with
the defaults of February and March, 1985 and April, 1985 and May, 1985 will constitute
three defaults. As such the view taken by both the Courts below cannot be countenanced.
10. Consequently, the judgment and order of the High Court as also the order of the First
Appellate Court are set aside and the decree granted by the Trial Court for eviction is
maintained.
11. The appeal is accordingly, allowed.
12. However, the respondent tenant is directed to handover the vacant possession of the
premises in question to the appellant-landlord by 31st August, 2008. The respondent shall
file the usual undertaking to this effect within four weeks from today in this Court.
13. It is submitted by learned counsel for the respondent that the entire arrears of rent
have already been paid. He shall continue to pay the rent till 31st August, 2008.
Appeal allowed.
AIR 2008 SUPREME COURT 543 "Binapani Paul v. Pratima Ghosh"
(From : 2004 (1) Cal HN 185)
Coram : 2 S. B. SINHA AND MARKANDEY KATJU, JJ.
Civil Appeal No. 8098 of 2004, D/- 27 -4 -2007.
Binapani Paul v. Pratima Ghosh and Ors.
(A) Transfer of Property Act (4 of 1882), S.41 - IMMOVABLE PROPERTY - Purchase
of property by husband in name of his wife - Practice prevalent in respect thereto at
relevant time - Not of much importance - A Court of law is required to determine such a
question - Without anything more, it cannot determine same on basis of such alleged
practice only. (Para 12)
(B) Transfer of Property Act (4 of 1882), S.41 - IMMOVABLE PROPERTY - BENAMI
TRANSACTION - POWER OF ATTORNEY - RIGHT TO PROPERTY - Benami
transaction - When can be inferred - Property purchased in the name of wife through
power of attorney executed by wife - Husband being attesting witness to power of
attorney showing that he knew transaction executed by wife - Insurance policy also
purchased in name of wife - Property mutated in name of wife immediately - Purchase of
property in year 1935 when Hindu Women's Right to Property Act did not come into
force - Couple having a son and seven minor daughters - Intention of husband in such a
case to purchase property for benefit and security of wife and daughters, can be inferred
in such case - Held that, it was not benami transaction.
2004 (1) Cal HN 185, Reversed.
Where in year 1935 the property was purchased by husband in the name of wife through
a power of attorney which was
@page-SC544
executed by wife in favour of husband's brother and husband himself attested the power
of attorney and name of wife was mutated in land records, it was held that it was not a
benami transaction but the property was purchased by husband for the benefit of his wife
as he had seven minor daughters and a son and he wanted to secure the future of his wife
and daughters. Moreover, in 1935, Hindu Women's Right to Property Act, 1937 did not
come into force. He, therefore, might have been of the opinion that in case of his early
death, something should be kept apart for his wife and daughters. When a person
develops such an intention, it would be opposed to the essential characteristics of a
benami transaction. He furthermore was not a debtor. He was not required to avoid any
liability. He had no apparent motive for entering into a benami transaction. Further, in the
power of attorney she was not described as his wife but dauther of 'B'. Therefore, he
being in the position of husband and if he intended to have a benami transaction,
ordinarily, he would not get his wife described as daughter of somebody instead of his
own wife. Such unusual step on the part of husband would lead to one conclusion that he
intended to purchase the property for the benefit of his wife. Moreover, in the power of
attorney it was categorically stated that it was wife who had decided to purchase the said
property and it was she who was appointing her husband's brother as her attorney.
Further, the fact that an insurance was also made in her name is also a pointer to show
that husband intended to provide sufficient money at the hands of his wife. It was more so
when after the death of husband and wife, their son maltreated the daughters who were
unmarried at that time and those daughters mutated the property in their name and the
fact that the son allowed the order of mutation to attain finality, thus, would also be a
pointer to suggest that despite such bitter relationship between the parties he accepted the
same; moreso, when mutation of one's name in the Municipal Corporation confers upon
him a variety of rights and obligations.
2004 (1) Cal HN 185, Reversed.
(Paras 13, 15, 19, 35, 51)
(C) Limitation Act (36 of 1963), Art.64, Art.65 - LIMITATION - PLEA - Plea of ouster -
If pleaded, title has to be acknowledged - Once such plea is taken, irrespective of fact that
as to whether any other plea is raised or not, conduct of parties would be material - If,
therefore, plea of ouster is not established, a fortiori the title of other co-sharers must be
held to have been accepted. (Para 40)
(D) HINDU LAW - GIFT - Hindu Law - Dayabhaga School - Does not prohibit gift of
immovable property in favour of his wife by her husband - It merely says that
Dayabhaga did not recognize it to be her stridhan - It was only for the purpose of
inheritance and succession - Same has nothing to do with Benami transaction of Property
and to determine nature of transaction. (Para 49)
Cases Referred : Chronological Paras
2007 AIR SCW 2897 : AIR 2007 SC 1753 : 2007 (4) AIR Kar R 227 (Ref) 43
2006 AIR SCW 4368 : 2006 (6) AIR Kar R 13 (Rel on) 41
2006 AIR SCW 4905 : AIR 2006 SC 3359 (Rel on) 38
2006 AIR SCW 5794 : AIR 2007 SC 204 (Ref) 43
2004 AIR SCW 4948 : AIR 2004 SC 4187 (Rel on) 50
AIR 1999 Cal 86 38
(1996)4 SCC 490 50
1994 Supp (1) SCC 734 50
AIR 1980 SC 727 (Ref) 27, 50
AIR 1979 SC 553 (Rel on) 44
AIR 1977 SC 796 : 1977 Cri LJ 566 50
AIR 1974 SC 171 (Rel on) 29, 50
1974 Cal LJ 370 16
AIR 1965 SC 271 (Ref) 22
(1956)60 Cal WN 88631
AIR 1940 Cal 356 32, 48
AIR 1939 Pat 462 (Disting) 34
AIR 1938 Mad 8 26
AIR 1934 Mad 671 30
AIR 1932 PC 13 25
AIR 1931 Bom 97 38
AIR 1927 PC 230 38
AIR 1927 Mad 194 31
AIR 1925 PC 181 12
(1877) ILR 1 Mad 281 48
(1854)6 Moo Ind App 53 12
S. B. Sanyal, Sr. Advocate, Rauf Rahim, Mohd. Iqbal, for Appellant; Bhaskar P. Gupta,
Sr. Advocate, Tara Chandra Sharma, Ms. Neelam Sharma, Devadatt Kamat, Abhijat P.
Medh, for Respondents.
Judgement
S. B. SINHA, J.:-One Dr. Ashutosh Ghosh (Dr. Ghosh), a Physician practising at
Rangoon was a prosperous person. He
@page-SC545
purchased two immovable properties in Calcutta in the year 1927 situate at 79/3-A and
79/3-B, Lower Circular Road, Calcutta, in his own name. Suprovabala was his wife. They
at the relevant time had seven daughters, including the appellant herein and a son named,
Amal. Respondent Nos. 1 and 2 are his wife and daughter. Suprovabala intended to
purchase the premises situate at No. 24, Convent Road, Calcutta belonging to the estate
of Late Edwin St. Clair Vallente. She executed a power of attorney in favour of one Atul
Chandra Ghosh, brother of Dr. Ghosh, the relevant portion whereof reads as under :
?...Whereas I have decided to purchase premises No.24, Convent Road, Calcutta,
belonging to the Estate of Late Mr. Edwin St. Chair Vallente at the price of Rs.26000/-
(Rupees Twenty Six thousand only) but the agreement for sale has not yet been entered
into with the Administration General of Bengal as Administrator to the Estate of Edwin
St. Clair Vallente now therefore know. Yet that I hereby appoint Atul Chandra Ghosh of
79/3-A, Lower Circular Road, Calcutta my attorney to do and execute for me and in my
name and all acts, matters and things that may be necessary in order to complete the said
purchase and particularly the following : ...
In witness whereof I set and subscribe my hand and seal at Rangoon this 23rd day of
September 1935 in the presence of
Date: 23.09.1935
No.1986
Date of Registry : 17.10.1935
Sd/- Smt. Supravabla Ghosh
Sd/- K.N. Ganguli
Advocate High Court and Councilor
Corporation of Rangoon
Sd/- S.N. Ganduly, Advocate, High Court
Sd/- Ashutosh Ghosh M.B. (Cal)
Medical Practioner...?
2. The said power of attorney, however, was preceded and followed by two telegrams of
Dr. Ghosh addressed to his brother in relation to execution thereof as also purchase of the
said property. The said power of attorney was executed before a Magistrate at Rangoon.
Dr. Ghosh was an attesting witness therein. Interestingly, Suprovabala described herself
as daughter of Babu Rangalal Ghosh and not the wife of Dr. Ghosh therein. A registered
indenture was executed on 16.11.1935 by the Administrator General of Bengal to the
estate of Edurn St. Clair Vallentine in favour of Suprovabala for a sum of Rs. 26,000/-.
Indisputably, during the life time of Dr. Ghosh, the name of Suprovabala was mutated.
She had all along been in possession of the said property. Dr. Ghosh died in Rangoon in
the year 1940. Suprovabala continued to reside in the suit premises. She died on
26.05.1942 leaving, as indicated hereinbefore, seven daughters and son Amal. Amal was
married to Respondent No. 1 herein in 1946.
3. In the year 1958, the daughters of Suprovabala got their names mutated in place of
their mother. Amal objected thereto, but his objection was rejected. Marriage of four
sisters of Amal took place in the suit premises during the period 1944 to 1970. Although
initially all the sisters and the brother were living together in the said house, inter alia,
after their marriage the daughters of Suprovabala started living at their respective
husbands? places. However, three sisters allegedly continued to live in the said house till
May, 1958 but they had to leave it because of ill-treatment of Amal and his wife. It
appears that in the year 1964, two unmarried daughters of Suprovabala who had been
living there were also compelled to leave the house. They filed a suit for maintenance
with liberty to claim their right to take appropriate legal action to recover their share of
the said premises at an appropriate time, which was allowed by the High Court. Three out
of the seven daughters of Dr. Ghosh filed a suit for partition against Amal on 19.09.1973
claiming 3/7th share of the property of their mother, a final decree for partition as also a
decree for accounts.
4. Amal in his written statement filed in the suit inter alia contended that Suprovabala was
benamidar of Dr. Ghosh. Suprovabala, therefore, had only a limited interest under the
Hindu Women?s Right to Property Act, 1937 and on her death Amal became the absolute
owner. Amal died during pendency of the suit whereupon Respondent Nos. 1 and 2 were
substituted in his place.
5. Before the learned Trial Judge, plaintiff - Binapani examined herself as PW-3. A
common relation of the parties being Chandi Charan Ghosh examined himself as PW-4.
Respondent No. 1 did not examine herself. Putul Ghosh, daughter of Amal who was born
only in 1954 examined herself as DW-1.
@page-SC546
6. The learned Trial Judge decreed the suit holding that Dr. Ghosh intended to purchase
the said property for the benefit of his wife. The Trial Court in its judgment opined that if
Dr. Ghosh wanted to purchase the property for himself, there was no necessity for
execution of power of attorney by Suprovabala in favour of Atul Chandra Ghosh. It was
noticed that the power of attorney had been attested by Dr. Ghosh which is a pointer to
show that the property was purchased by him for the benefit of his wife. Circumstances
surrounding the same, it was held, also led to the said conclusion. It was, therefore, not
held to be a case of benami transaction. A first appeal was preferred thereagainst before
the High Court by Respondent Nos. 1 and 2. A Division Bench of the High Court
although completed hearing of the appeal on 25.01.2002, delivered judgment after 19
months, i.e., on 29.07.2003.
7. The High Court opined that - :
(i) it was for the plaintiff to prove that Dr. Ghosh purchased the property for the benefit of
his wife;
(ii) purchase by Suprovabala through an attorney does not negative the nature of
transaction being a benami one;
(iii) mutation of names of all the heirs of Suprovabala was of no consequence.
(iv) Dr. Ghosh could not have gifted the property in favour of his wife being
impermissible under the Dayabhaga School of Hindu Law.
8. Mr. S. B. Sanyal, learned senior counsel appearing on behalf of the appellant,
submitted that the High Court committed a manifest error in passing the impugned
judgment insofar:
(i) the onus of proof had wrongly been placed upon the plaintiff;
(ii) the defendant had not been able to show any motive for the benami purchase.
(iii) the presumption that an apparent state of affairs is the real state of affairs has not
been rebutted by aduction of any cogent evidence.
(iv) contribution of purchase money is only one of the factors for proving benami
transaction but intention also plays a significant role in relation thereto which was
required to be determined having regard to the surrounding circumstances, the
relationship of the parties, the motive governing their action and the subsequent conduct
of the parties.
(v) Putul Ghosh (DW-1) cannot be said to have any knowledge about the transaction and
there was no reason as to why her mother Pratima Ghosh did not examine herself as a
witness.
9. Mr. Devadatt Kamat, learned counsel appearing on behalf of Respondent Nos. 4 to 7
supplemented the argument of Mr. Sanyal stating that the High Court cursorily dealt with
the question of intention in relation to the transaction in question. Our attention has also
been drawn to Section 5 of the Power of Attorney Act, 1882.
10. Mr. Bhaskar P. Gupta, learned senior counsel appearing on behalf of Respondent Nos.
1 and 2, on the other hand, would submit that:
(i) the suit property having been acquired in the year 1935, as purchases of property in
the benami name of wives being prevalent at the relevant time, the case was required to
be considered from that angle.
(ii) a transaction in benami may be entered into for no apparent reason.
(iii) doctrine of advancement has no application in India.
(iv) Benami Transactions (Prohibition) Act, 1988 has no retrospective effect. The source
of money being an important factor for determining benami nature of transaction, the
onus lay on the plaintiffs.
(v) the parties being governed by the Dayabhaga School of Hindu Law, Dr. Ghosh could
not have made a gift of immovable property in favour of his wife.
11. Before embarking upon the rival contentions of the parties, we may also notice that
Dr. Ghosh had a life insurance. Suprovabala was his nominee and after his death, the
entire amount of insurance was received by her.
12. A question as to whether a transaction evidences a benami nature thereof is always
difficult to answer. It is a case where despite some evidence brought on records by the
plaintiffs that Suprovabala paid the consideration amount or at least a part of it, we may
proceed to determine the issues between the parties on the premise that the amount of
consideration was provided by Dr. Ghosh. A person may for various reasons intend to
purchase a property in the name of his wife. It may be for one reason or the other. There
may or may not be a practice
@page-SC547
in respect thereto. A purported prevalent practice in this behalf, as was observed by the
Judicial Committee, in Sura Lakshmiah Chetty and Others v. Kothandarama Pillai [AIR
1925 PC 121] and Gopeekrist Gosain v. Gungapersaud Gosain [(1854) 6 Moore's Indian
Appeals 53], is in our opinion not of much importance. A court of law is required to
determine such a question. Without anything more, it cannot determine the same on the
basis of such an alleged practice only.
13. Dr. Ghosh was a prosperous person. He must be a medical practitioner of repute. He
had purchased two very valuable properties in Calcutta in quick succession being situate
at 79/3-A and 79/3-B, Lower Circular Road, Calcutta, which is a very prime area in the
town of Calcutta. The property in question was purchased in 1935. Admittedly,
renovations were made in the year 1938. He died in the year 1940 at Rangoon. At that
point of time, none of his children was married. He had seven daughters. In 1935, Hindu
Women's Right to Property Act, 1937 did not come into force. He, therefore, might have
been of the opinion that in case of his early death, which appears to have been his
premonition, something should be kept apart for his wife and daughters. When a person
develops such an intention, it would be opposed to the essential characteristics of a
benami transaction. He furthermore was not a debtor. He was not required to avoid any
liability. He had no apparent motive for entering into a benami transaction. The plaintiffs'
case that he had done so for the benefit of his wife, therefore, must be considered from
that angle.
14. Amal appears to be the eldest amongst the children. When a son is the eldest amongst
the children, expectation of a father will always be that on his death, he would look after
his mother and sisters. Son would perform his duties not only by providing maintenance
to the daughters, to which they were otherwise entitled to, but also they were to be
married. Dr Ghosh's eagerness to purchase the property is evidenced by two telegrams
dated 20th and 24th September, 1935.
15. Mr. Gupta's submission that the said telegrams are relevant to show Dr. Ghosh's
personal involvement in the transaction may not be of much significance. They were at
Rangoon. Negotiations for purchase were to be held with the Administrator General of
Bengal. Earnest money was to be deposited. The deed was to be drawn up. In those days,
a Hindu wife was supposed to maintain some 'purdah'. We do not know whether she
knew English or not. She, therefore, was not expected to draft a telegram and go to post
office for the purpose of transmission thereof. But, the power of attorney executed by her
plays an important role. The power of attorney must have also been drafted at the behest
of Dr. Ghosh. Ordinarily, Suprovabala would be described as the wife of Dr. Ghosh. She
was not. She was described as the daughter of Babu Rangalal Ghosh. Dr. Ghosh himself
was an attesting witness. He being in the position of husband and if we accept the case of
the defendants-respondents that he intended to have a benami transaction, ordinarily, he
would not get his wife described as daughter of somebody instead of his own wife. Such
unusual step on the part of Dr. Ghosh leads to one conclusion that he intended to
purchase the property for the benefit of his wife. The recitals made in the power of
attorney are also of much significance. It was categorically stated that it was Suprovabala
who had decided to purchase the said property and it was she who was appointing her
husband's brother as her attorney.
16. In Tara Sundari Sen v. Pasupati Kumar Banerjee and Ors. [1974 CLJ 370], it was
observed - :
"...The only purpose of Nagendra Nath Ganguly having been a signatory to the said
document must have been to represent to the world at large that the property was being
acquired by Sm. Shantabala as her absolute property and that her husband had no right,
title or interest in the same..."
17. It was further observed therein - :
"The significance and value of these indisputable facts have to be carefully assessed. It is
common case that the ultimate source of the money was the income and savings of
Nagendra Nath Ganguly. The plaintiff contends that Nagendra Nath made a gift of the
money to his wife Shantabala to enable her to acquire the properties. If that be so, the
properties were Shantabala's Ajoutuka Stridhana. That Nagendra made gift out of his
funds does not in any way prejudice the plaintiff's case. Once the gift was made, if it was
made at all, the money belonged absolutely to Shantabala and the properties she
purchased were hers and hers alone. That Nagendra engaged a contractor or a supervisor
for construction of a structure
@page-SC548
on the land purchased by Shantabala or that he made payments to the contractor or the
supervisor will not by itself be any evidence of his ownership. The husband of a Hindu
lady living in a common matrimonial home usually manages and maintains her
properties. The Court can and ought to take judicial notice of the fact that ordinarily in a
Hindu household the husband deals with strangers and trademen. Therefore, the fact that
payments were made by Nagendra Nath Ganguly is not inconsistent with the case that the
premises belonged to Shantabala absolutely."
18. In a given situation, execution of a power of attorney may not be of importance but
then the backdrop of events and the manner in which the power of attorney was drafted as
well as the very fact that Dr. Ghosh himself became an attesting witness thereto, the same
plays very significant role. If in the light of the so-called practice as then existed, i.e., to
purchase property in the name of his wife, Dr. Ghosh intended to enter into a benami
transaction, his intention, therefor, would have been clear and unambiguous or in any
event, the same would have been explicit from the surrounding circumstances. They were
not. Moreover, immediately after the purchase, the name of Suprovabala was mutated.
She started paying tax. There is no evidence to show that Dr. Ghosh took an active role
except providing for the amount in regard to the construction of the house. Evidence on
records clearly show that Suprovabala had also been looking after the constructions of the
house along with Chandi Charan Ghosh (PW-4).
19. The fact, which we have noticed hereinbefore, viz., that an insurance was also made
in her name is also a pointer to show that Dr. Ghosh intended to provide sufficient money
at the hands of his wife. [See Ext. A (13)] Ordinarily, a son would be made a nominee.
We must place on record the social condition as thence prevailing, viz., a son under the
law was bound to maintain his family and, therefore, the entire property at the disposal of
the father would be given to the son.
20. We do not have any direct evidence of conclusive nature in this regard before us. We
must, therefore, deal with the matter on reasonable probabilities and legal inferences.
21. Dr. Ghosh indisputably was a person having a superior knowledge and understanding.
He was holding a responsible position in the society. He was in a noble profession. When
he made attestation of the deed of the power of attorney keeping in view the fact that he
was the husband there cannot be any doubt that he fully understood in regard to the
nature of the transaction as also the contents and merits thereof.
22. We may at this juncture also notice a Constitution Bench decision of this Court in
Kanakarathanammal v. V.S. Loganatha Mudaliar [AIR 1965 SC 271 : (1964) 6 SCR 1]
wherein this Court had an occasion to deal with the question of providing money to the
wife, the purpose for purchase of the property vis-a-vis a transaction which was benami
in nature. For the purpose of inferring acknowledgement and/ or admission by husband
that the property was purchased by his wife, this Court, upon taking into consideration
the provisions of Mysore Hindu Law Women's Rights Act (10 of 1933), opined - :
"12. We have carefully considered the arguments thus presented to us by the respective
parties and we are satisfied that it would be straining the language of Section 10(2)(b) to
hold that the property purchased in the name of the wife with the money gifted to her by
her husband should be taken to amount to a property gifted under Section 10(2)(b). The
argument about the substance of the transaction is of no assistance in the present case,
because the requirement of Section 10(2)(b) is that the property which is the subject-
matter of devolution must itself be a gift from the husband to the wife. Can we say that
the property purchased under the sale deed was such a gift from the husband to his wife?
The answer to this question must clearly be in the negative. With what funds the property
is purchased by the female is irrelevant for the purpose of Section 10(2)(d); so too the
source, the title to the fund with which the said property was purchased. All that is
relevant to enquire is: has the property been purchased by the female, or has it been gifted
to her by her husband? Now, it seems clear that in deciding under which class of
properties specified by clauses (b) and(d) of Section 10(2) the present property falls, it
would not be possible to entertain the argument that we must treat the gift of the money
and the purchase of the property as one transaction and hold on that basis that the
property itself has been gifted by the husband to his
@page-SC549
wife. The obvious question to ask in this connection is, has the property been gifted by
the husband to his wife, and quite clearly a gift of immovable property worth more than
Rs. 100 can be made only by registered deed. The enquiry as to whether the property was
purchased with the money given by the husband to the wife would in that sense be
foreign to Section 10 (2)(d) gift of money which would fall under Section 10(2)(b) if
converted into another kind of property would not help to take the property under the
same clause, because the converted property assumes a different character and falls under
Section 10(2)(d). Take a case where the husband gifts a house to his wife, and later, the
wife sells the house and purchases land with the proceeds realised from the said sale. It is,
we think, difficult to accede to the argument that the land purchased with the sale-
proceeds of the house should, like the house itself, be treated as a gift from the husband
to the wife; but that is exactly what the appellants argument; will inevitably mean. The
gift that is contemplated by Section 10(2)(b) must be a gift of the very property in specie
made by the husband or other relations therein mentioned. Therefore, we are satisfied that
the trial court was right in coming to the conclusion that even if the property belonged to
the appellants mother, her failure to implead her brothers who would inherit the property
along with her makes the suit incompetent. It is true that this question had not been
considered by the High Court, but since it is a pure point of law depending upon the
construction of Section 10 of the Act, we do not think it necessary to remand the case for
that purpose to the High Court..."
23. Mr. Gupta made an endeavour to distinguish the said decision on fact of the matter
submitting that therein the father wrote a large number of letters which included a
discussion of the wife's will where he had acknowledged the wife's title to the property,
but we have to consider the crux of the matter to understand the underlying principle laid
down therein.
24. Acceptance of acknowledgement of title comes in various forms. It may be before the
transaction is entered into and may be subsequent thereto. The court has to gather the
intention of the concerned parties on the basis of the circumstances surrounding the
transaction and not from the conduct of the parties only at a subsequent stage. It may be
true that ipso jure acknowledgement of title would mean the same should be only after
the title is acquired, but, whether addressing ourselves to a question of this nature, viz., as
to whether Dr. Ghosh intended to enter into a benami transaction in the name of his wife,
either surrounding circumstances leading to the inference that he had no such intention
must be gathered from the totality of the circumstances both preceding and subsequent to
the transaction in question or if the intention of the person providing for the fund for
purchasing the property has a major role to play, how it was given also assumes some
significance. Apart from the fact that Dr. Ghosh himself was keen to see that the property
is purchased for the benefit of his wife, we must notice that it was also mutated in her
name. When a mutation takes place with the knowledge of the husband, although not
conclusive, would provide for a link in the chain.
25. To decipher the intention of the parties, this Court must go back to the societal
situation as was prevailing in 1935. Dr. Ghosh as a man of ordinary prudence wanted to
make provision to protect and insure the welfare of his seven daughters and wife. In a
case of this nature, the answer to such a question has to be in the affirmative. Question of
intention is always relatable and peculiar to the facts of each case. [See Nawab Mirza
Mohammad Sadiq Ali Khan and Others v. Nawab Fakr Jahan Begam and Another AIR
1932 PC 13]
26. In Chittaluri Sitamma and another v. Saphar Sitapatirao and others [AIR 1938 Madras
8], it was held - :
"...The mere suspicion that the purchases might not have wholly been made with the
lady's money will certainly not suffice to establish that the purchases were benami, nor
even the suspicion that moneys belonging to Jagannadha Rao whether in a smaller
measure or a larger measure, must have also contributed to these purchases. Even in cases
where there is positive evidence that money had been contributed by the husband and not
by the wife, that circumstance is not conclusive in favour of the benami character of the
transaction though it is an important character..."
27
. The learned counsel for both the parties have relied on a decision of this Court in
Thakur Bhim Singh (Dead) By LRs and Another v. AIR 1980 SC 727

@page-SC550
Thakur Kan Singh [(1980) 3 SCC 72] wherein it has been held that the true character of a
transaction is governed by the intention of the person who contributed the purchase
money and the question as to what his intention was, has to be decided by - :
(a) Surrounding circumstances
(b) Relationship of the parties
(c) Motives governing their action in bringing about the transaction and
(d) Their subsequent conduct.
28. All the four factors stated may have to be considered cumulatively. The relationship
between the parties was husband and wife. Primary motive of the transaction was security
for the wife and seven minor daughters as they were not protected by the law as then
prevailing. The legal position obtaining at the relevant time may be considered to be a
relevant factor for proving peculiar circumstances existing and the conduct of Dr. Ghosh
which is demonstrated by his having signed the registered power of attorney.
29

. This aspect of the matter has been considered by this Court in Jaydayal Poddar
(Deceased) Through L.Rs. and Another v. Mst. Bibi Hazira and Others [(1974) 1 SCC 3],
wherein this Court held - : AIR 1974 SC 171, (Para 6)

"...The essence of a benami is the intention of the party or parties concerned; and not
unoften, such intention is shrouded in a thick veil which cannot be easily pierced through.
But such difficulties do not relieve the person asserting the transaction to be benami of
any part of the serious onus that rests on him; nor justify the acceptance of mere
conjectures or surmises, as a substitute for proof. The reason is that a deed is a solemn
document prepared and executed after considerable deliberation, and the person expressly
shown as the purchaser or transferee in the deed, starts with the initial presumption in his
favour that the apparent state of affairs is the real state of affairs. Though the question,
whether a particular sale is benami or not, is largely one of fact, and for determining this
question, no absolute formulae or acid test, uniformly applicable in all situations, can be
laid down; yet in weighing the probabilities and for gathering the relevant indicia, the
Courts are usually guided by these circumstances: (1) the source from which the purchase
money came; (2) the nature and possession of the property, after the purchase; (3) motive,
if any, for giving the transaction a benami colour; (4) the position of the parties and the
relationship, if any, between the claimant and the alleged benamidar; (5) the custody of
the title-deeds after the sale and (6) the conduct of the parties concerned in dealing with
the property after the sale."
30. Source of money had never been the sole consideration. It is merely one of the
relevant considerations but not determinative in character. [See Thulasi Ammal v. Official
Receiver, Coimbator AIR 1934 Madras 671].
31. In Protimarani Debi and Anr. v. Patitpaban Mukherjee and Ors. [60 CWN 886], the
Calcutta High Court observed - :
"The correct proposition was stated in Official Assignee of Madras vs. Natesha Gramani
(AIR 1927 Madras 194). There is no presumption that when a property stands in the
name of a female the Court will immediately jump to the conclusion without any proof
that it really belongs to the husband of the female. Before such a presumption is raised or
attracted it is necessary for the person who wants to make out that the property is not the
property of the female, in whose name the document stands, to establish the fact that the
consideration money for the purpose had come from the husband."
32. It will be useful at this juncture to notice a judgment of the Calcutta High Court in
K.K. Das, Receiver and others v. Sm. Amina Khatun Bibi and another [AIR 1940 Cal
356], wherein it was held that where a husband provides for the money for construction
of a building on a land which is in the name of his wife, he did not intend to reserve any
right in the structures raised therein.
33. In 1935, the appellant herein was a minor. Whether she was aged 9 years or 14 years,
thus, is immaterial. She, however, had the occasion to know something about the property
from her mother or father. Dr. Ghosh expired only in 1940 and Suprovabala died in 1942.
If the children had no knowledge about the title of her mother, there would not have been
any occasion for them to make any application for mutation of their names. Amal was
married in 1946. Allegedly, he and his wife started maltreating the sisters. Three of them,
as noticed hereinbefore, were yet to be
@page-SC551
married. The dispute between the parties rose to such a pass that three of the sisters had to
leave the house. They had to seek for a shelter somewhere else. So long as the
relationship between the parties was good, evidently, no problem arose. The mutation in
the name of the daughters, therefore, assumes considerable significance. It is not a
coincidence that three daughters had to leave the house and an application for mutation
was filed in the year 1958. Amal objected thereto and it would not be a matter beyond
anybody's comprehension that he had fought out the same bitterly. He must have done it
and despite the same mutation was done in the name of all. Only a suggestion was given
to PW-4 that the name of all the co-sharers was mutated only because husband of one of
the sisters was in Calcutta Municipal Corporation. If that be so, it was expected of Amal
to prefer an appeal thereagainst. It was expected that he would file a suit for declaration
to assert his own title as he did in the suit.
34. Mr. Gupta has relied upon a decision of the Patna High Court in Shahdeo Karan
Singh and others v. Usman Ali Khan [AIR 1939 Patna 462] wherein it was held that
obtaining mutation of names do not establish a gift. This may be so. But, however, in this
case, we are concerned with the conduct of the parties.
35. The fact that Amal allowed the order of mutation to attain finality, thus, would also be
a pointer to suggest that despite such bitter relationship between the parties he accepted
the same; more so, when mutation of one's name in the Municipal Corporation confers
upon him a variety of rights and obligations. He had rights and obligations in relation
thereto because, according to him, in relation to the said property vis-a-vis Calcutta
Municipal Corporation, he was residing with his wife, he allegedly inducted tenants and
had been realizing rent from them.
36. Tenants could have denied his title. He would not have been given permission to
make any additions or alterations. He, in absence of an order of mutation, might not be
given other amenities, if he had filed such an application in his own name. He, therefore,
knew that mutation of names of all the parties in the Calcutta Municipal Corporation may
bring forth to him many obstacles in future in the enjoyment of the property. At least he
could have taken such a step even after the suit filed by two of the sisters for
maintenance. The suit was decreed. Even in the said suit, the right to claim partition in
the properties had been kept reserved.
37. We have seen hereinbefore that the appellant examined herself as a witness. The wife
of Amal even did not do so. An adverse inference should be drawn against her.
38

. In Tulsi and Others v. Chandrika Prasad and Others [(2006) 8 SCC 322], this Court
observed - : 2006 AIR SCW 4905, (Paras 25 and 26)

"Before the courts below, the Appellant No. 1 did not examine herself. The Respondents
categorically averred in the plaint that the mortgage amount was tendered to her as also to
her husband. Having regard to the peculiar facts and circumstances of this case, we are of
the opinion that she should have examined herself to deny such tender.

In Sardar Gurbakhsh Singh v. Gurdial Singh and Another [AIR 1927 PC 230], the Privy
Council emphasized the need of examination of the parties as witnesses. [See also
Martand Pandharinath v. Radhabai, AIR 1931 Bom 97 and Sri Sudhir Ranjan Paul v. Sri
Chhatter Singh Baid and Anr., Cal LT 1999(3) HC 261]" AIR 1999 Cal 86

39. Daughter of Respondent No. 1 (Respondent No. 2) who was born in 1954 examined
herself as DW-1. She evidently had no knowledge about the transaction. She could not
have any. At least it was expected that Respondent No. 1 might have gathered some
knowledge keeping in view the conduct of her husband vis-a-vis the sisters in relation to
the property. Even otherwise, she was a party to the suit. No evidence, worth the name,
therefore, had been adduced on behalf of Respondent No. - 1.
40. Interestingly, Amal pleaded ouster. If ouster is to be pleaded, the title has to be
acknowledged. Once such a plea is taken, irrespective of the fact that as to whether any
other plea is raised or not, conduct of the parties would be material. If, therefore, plea of
ouster is not established, a' fortiori the title of other co-sharers must be held to have been
accepted.
41

. In T. Anjanappa and Others v. Somalingappa and Another [(2006) 7 SCC 570], it was
held - : 2006 AIR SCW 4368

"12. The concept of adverse possession contemplates a hostile possession i.e. a


possession which is expressly or impliedly in denial of the title of the true owner.
@page-SC552
Possession to be adverse must be possession by a person who does not acknowledge the
other's rights but denies them. The principle of law is firmly established that a person
who bases his title on adverse possession must show by clear and unequivocal evidence
that his possession was hostile to the real owner and amounted to denial of his title to the
property claimed. For deciding whether the alleged acts of a person constituted adverse
possession, the animus of the person doing those acts is the most crucial factor. Adverse
possession is commenced in wrong and is aimed against right. A person is said to hold the
property adversely to the real owner when that person in denial of the owner's right
excluded him from the enjoyment of his property."
42. It was further held - :
"21. The High Court has erred in holding that even if the defendants claim adverse
possession, they do not have to prove who is the true owner and even if they had believed
that the Government was the true owner and not the plaintiffs, the same was
inconsequential. Obviously, the requirements of proving adverse possession have not
been established. If the defendants are not sure who is the true owner the question of their
being in hostile possession and the question of denying title of the true owner do not
arise..."
43

. [See also Govindammal v. R. Perumal Chettiar and Ors., (2006) 11 SCC 600 and P.T.
Munichikkanna Reddy and Ors. v. Revamma and Ors., Civil Appeal No. 7062 of 2000
decided on 24th April, 2007]. 2006 AIR SCW 5794
reported in 2007 AIR SCW 2897

44

. Amal, therefore, could not have turned round and challenged the title of the appellant
and other respondents. [See Syed Abdul Khader v. Rami Reddy and Others (1979) 2 SCC
601]. AIR 1979 SC 553

45. PW-3 in her evidence made three significant statements - :


(i) The property was purchased for the benefit of the mother without keeping any
financial interest;
(ii) During the lifetime of her father, her mother used to exercise right, title and interest of
the property and she continued to do so even after her father's death.
(iii) Her mother used to say that the property belonged to her.
46. PW-4 Chandi Charan Ghosh is a common relation. According to him, Dr. Ghosh
acknowledged the title of his wife before him. We may not rely on his evidence in its
entirety but we intend to emphasise that at least some evidence has been adduced on
behalf of the appellant whereas no evidence, worth the name, has been adduced on behalf
of the defendants respondents. DW-1, as noticed hereinbefore, having born in 1954, could
not have any personal knowledge either in regard to the transaction or in regard to the
management of the property by Suprovabala whatsoever. She was even only four years
old when the name of all co-sharers was mutated in the records of the Calcutta Municipal
Corporation. She, however, admitted that there are two other houses standing in the name
of Dr. Ghosh. She even could not say anything about the power of attorney. She accepted
that the suit house was in the name of Suprovabala till 1958. She accepted that her father
objected to the mutation but the same was granted and no further step had been taken.
Although she claimed that she had been looking after the affairs, she could not give any
details about the purported litigations as against the tenants initiated by her father.
47. Reliance placed by Mr. Gupta on Hindu Women's Right to Property Act, 1937 is
misplaced as the property was purchased in the year 1935. The said Act had no
application at that point of time. There, however, cannot be any doubt whatsoever in
regard to the legal position that in respect of other properties of Dr. Ghosh, she had a
limited interest.
48

. Reliance by the High Court upon Mulla's Hindu Law for the proposition that husband
could not give immovable property as stridhan to his wife, in our opinion, is wholly
misplaced. Mulla has relied upon a decision of the Madras High Court in Venkata Rama
Rau v. Venkata Suriya Rau and Another [ILR (1877) Madras 281 at 286]. What Mulla in
fact says is that any gift or immovable property under Dayabhaga law would not become
wife's stridhan. It is, however, not in dispute that the amount necessary for purchasing an
immovable property can be a subject-matter of gift by a person in favour of his wife. [See
K.K. Das (supra)] AIR 1940 Cal 356

@page-SC553
49. We are also really not concerned with such a situation as the situation had undergone
a sea-change after coming into force of the Transfer of Property Act. The Transfer of
Property Act prescribes that any clog on transfer of property right to transfer would be
void. Dayabhaga does not prohibit gift of immovable property in favour of his wife by
her husband. It merely says that Dayabhaga did not recognize it to be her stridhan. It was
only for the purpose of inheritance and succession. The same has nothing to do with the
Benami Transaction of the Property and to determine the nature of transaction.
50

. Burden of proof as regards the benami nature of transaction was also on the respondent.
This aspect of the matter has been considered by this Court in Valliammal (D) By LRS. v.
Subramaniam and Others [(2004) 7 SCC 233] wherein a Division Bench of this Court
held - : 2004 AIR SCW 4948

"13. This Court in a number of judgments has held that it is well established that burden
of proving that a particular sale is benami lies on the person who alleges the transaction
to be a benami. The essence of a benami transaction is the intention of the party or parties
concerned and often, such intention is shrouded in a thick veil which cannot be easily
pierced through. But such difficulties do not relieve the person asserting the transaction to
be benami of any part of the serious onus that rests on him, nor justify the acceptance of
mere conjectures or surmises, as a substitute for proof. Refer to Jaydayal Poddar v. Bibi
Hazra, Krishnanand Agnihotri v. State of M.P., Thakur Bhim Singh v. Thakur Kan Singh,
Pratap Singh v. Sarojini Devi and Heirs of Vrajlal J. Ganatra v. Heirs of Parshottam S.
Shah. It has been held in the judgments referred to above that the question whether a
particular sale is a benami or not, is largely one of fact, and for determining the question
no absolute formulas or acid test, uniformly applicable in all situations can be laid. After
saying so, this Court spelt out the following six circumstances which can be taken as a
guide to determine the nature of the transaction - : AIR 1974 SC 171
AIR 1977 SC 796
AIR 1980 SC 727

(1) the source from which the purchase money came;


(2) the nature and possession of the property, after the purchase;
(3) motive, if any, for giving the transaction a benami colour;
(4) the position of the parties and the relationship, if any, between the claimant and the
alleged benamidar;
(5) the custody of the title deeds after the sale; and
(6) the conduct of the parties concerned in dealing with the property after the sale.
(Jaydayal Poddar v. Bibi Hazra1, SCC p. 7, para 6)
14. The above indicia are not exhaustive and their efficacy varies according to the facts of
each case. Nevertheless, the source from where the purchase money came and the motive
why the property was purchased benami are by far the most important tests for
determining whether the sale standing in the name of one person, is in reality for the
benefit of another. We would examine the present transaction on the touchstone of the
above two indicia.
*** *** ***
18. It is well settled that intention of the parties is the essence of the benami transaction
and the money must have been provided by the party invoking the doctrine of benami.
The evidence shows clearly that the original plaintiff did not have any justification for
purchasing the property in the name of Ramayee Ammal. The reason given by him is not
at all acceptable. The source of money is not at all traceable to the plaintiff. No person
named in the plaint or anyone else was examined as a witness. The failure of the plaintiff
to examine the relevant witnesses completely demolishes his case."
51. For the reasons aforementioned, the impugned judgment cannot be sustained which is
set aside accordingly. The judgment of the Trial Court is restored. The appeal is allowed.
In the peculiar facts and circumstances of this case, however, there shall be no order as to
costs.
Appeal allowed.
AIR 2008 SUPREME COURT 553 "Indian Overseas Bank, Anna Salai v. P. Ganesan"
(From : 2006 Lab IC 1519 (Mad))
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Civil Appeal No. 5369 of 2007 (arising out of SLP (C) No. 8683 of 2006), D/- 23 -11
-2007.
Indian Overseas Bank, Anna Salai and Anr. v. P. Ganesan and Ors. @page-SC554
Industrial Disputes Act (14 of 1947), Sch.2, Item 3 - INDUSTRIAL DISPUTE -
DEPARTMENTAL PROCEEDINGS - WRITS - DISCIPLINARY PROCEEDINGS -
Departmental proceedings - Stay of, on ground of pendency of criminal proceedings
against delinquent - Delinquent officers without filing reply to show cause notice, moved
High Court - Nothing shown that any complicated question of law, arose for
determination in criminal case - Large number of witnesses examined on behalf of
management - Delinquents did not cross examine them - Disciplinary proceedings
proceeded to great extent - No finding recorded that delinquents would be prejudiced if
departmental proceedings, not stayed - In facts and circumstances stay of departmental
proceedings without analyzing and applying principle of law evolved in binding
precedent - Liable to be set aside.
2006 Lab IC 1519 (Mad), Reversed.
2006 AIR SCW 2709, 2004 AIR SCW 7290 and 2007 AIR SCW 304, Disting.
Constitution of India, Art.226. (Paras 20, 22, 26, 27)
Cases Referred : Chronological Paras
2007 AIR SCW 304 (Disting.) 13, 25
2006 AIR SCW 2709 : AIR 2006 SC 2129 : 2006 (4) AIR Kar R 641 : 2006 (3) AIR Jhar
R 312 (Disting.) 13, 24
2004 AIR SCW 4558 : AIR 2004 SC 4127 : 2004 Lab IC 3226 (Ref.) 12, 19
2004 AIR SCW 7290 : AIR 2005 SC 1406 : 2005 Lab IC 1624 (Disting.) 13, 23
1999 AIR SCW 1098 : AIR 1999 SC 1416 : 1999 Lab IC 1565 (Ref.) 18, 19, 22
1996 AIR SCW 4160 : AIR 1997 SC 13 : 1996 Lab IC 2750 (Ref.) 10, 17, 19
AIR 1965 SC 155 (Rel. on) 16
AIR 1960 SC 806 (Rel. on) 16
Altaf Ahmed, Sr. Advocate, Vishal Chauhan, Ambrish Kumar, for Appellants; V. Prakash,
Sr. Advocate, Amit Sharma, Anupam Lal Das, S. Nanda Kumar, Satish Kumar,
Anandselvam, Ms. K. Indira, V. N. Raghupathy, for Respondents.
Judgement
S. B. SINHA, J. - :- Leave granted.
2. Whether pendency of a criminal case by itself would be a sufficient ground for stay of
the departmental proceedings is the principal question which arises for our consideration
in this case.
3. The basic fact of the matter is not in dispute.
4. Respondents 1 to 4 herein are the office bearers of the All India Indian Overseas Bank
SC/ST Employees Welfare Association. Indisputably another association was also
operating in the establishment of the appellant known as All India Indian Overseas Bank
Employees Union of which respondent No.5 is the President. Registration of similar
names gave rise to a dispute between the parties.
5. Indisputably a first information report was lodged on 27th January, 2005 with the
"Thousand Lights Police Station, Chennai" alleging that L. Balasubramanian, Respondent
No.5, herein was assaulted on 27th January, 2005 at about 12.35 p.m. within the bank
premises by Respondents Nos. 1 to 4 as well as by Mr. P. Rajalingam, the Deputy Chief
Officer working in the Regional Office of the appellant-bank. All the respondents are
indisputably employees of the bank. Their designations are as under - :-
(a) Respondent No.1 (P. Ganesan) is employed as Assistant Manager, Thiruvottiyur
Market Branch. He is also the General Secretary of All India Indian Overseas Bank
SC/ST Employees' Welfare Association.
(b) Respondent No.2 (S.Vijayakumar) is employed as a clerk in the Central Clearing
Office at Chennai. He is also the Vice President of the All India Indian Overseas Bank
SC/ST Employees' Welfare Association.
(c) Respondent No.3 (R Amalraj) is employed as a Messenger in the Inspection
Department, Central Office at Chennai. He is also the Organizing Secretary of the All
India Indian Overseas Bank SC/ST Employees' Welfare Association.
(d) Respondent No. 4 (A. Dakshina-moorthy) is employed as an Assistant Manager in the
Walltax Road Branch, Chennai. He is also the Deputy General Secretary of the All India
Indian Overseas Bank SC/ST Employees' Welfare Association.
(e) Respondent No.5 (L. Balasubra-manian) is employed as "Special Assistant" in
Foreign Exchange Department, Central Office at Chennai. He is also the President of All
India Indian Overseas Bank Employees Union (AIOBEU) as well as the President of the
National Confederation of Bank Employees (NCBE)."
6. An enquiry was conducted leading to discovery of certain additional facts. It may not
be necessary for us to take note of the same at this stage. Respondent No.5 was admitted
in the National Hospital for
@page-SC555
medical treatment. He remained confined therein for a period of twelve days. A charge-
sheet was filed by the Investigating Officer in the criminal case against Respondents Nos.
1 to 4 under Sections 341, 323, 324, 427, 307 and 506 (ii) of the Indian Penal Code.
Respondent Nos. 1 and 3 were arrested. They were, however, released on bail on 15th
February, 2005. Respondents Nos. 2 and 4, however, absconded. On or about 15th
February, 2005 they obtained anticipatory bail. Another first information was lodged by
Respondent Nos. - 1 to 4 against respondent No.5 in the said Thousand Lights Police
Station, Chennai.
7. Respondent Nos. 1 to 4 were placed under suspension by the appellant-bank by an
order dated 28th January, 2005. Charge-sheets dated 21st February, 2005 were also
served upon them. They were asked to show cause as to why disciplinary action be not
taken against them for their acts of indiscipline, insubordination, unruly and disorderly
behaviour, use of filthy language and most shameful abuses as well as murderous assault
on respondent No.5 within the office premises of the bank as also causing damage to
valuable properties and serious impairment to the banks prestige and reputation in the
estimation of public at large. Requests were made by the said respondents to revoke the
order of suspension by an application dated 9th March, 2005 assuring the authority that
they would fully co-operate with the authorities of the bank in the disciplinary
proceedings initiated against them. They, furthermore, requested the bank to grant them
one month's time to submit their reply to the show cause. Orders of suspension were
revoked on 16th April, 2005. No reply to the show cause notice, however, was filed by
them despite opportunities granted. Departmental enquiry was held against them on 18th
May, 2005 ; 3rd June, 2005, 17th June, 2005, 28th June, 2005, 8th July, 2005, 19th July,
2005, 29th July, 2005 and 4th August, 2005, the details whereof, as stated by the
appellants in their affidavit before the High Court, are as under - :-
"(a) ......The Enquiry was fixed for 18.5.2005 in respect of which the Respondents had
been duly intimated fairly in advance. However, the said Enquiry was adjourned to
3.6.2005 acceding to the written request dated 16.5.2005 of the respondents.
(b) The Enquiry was further adjourned to 17.6.2005 in response to the Respondents'
request for adjournment.
(c) The Enquiry was then fixed for 8.7.2005 in view of the Respondents' written request
dated 25.6.2005. However, the Respondents remained absent on 8.7.2005, and therefore
they were set ex parte, while adjourning the Enquiry to 19.7.2005.
(d) Meanwhile, the list of Management Witnesses was mailed to the Respondents Nos. 1
to 4 who admitted to have received the same.
(e) On 19.7.2005, only Respondents Nos.2 and 4 attended the Enquiry Proceedings, and
categorically admitted to have received the List of Management Witnesses, whereas
Respondents Nos.1 and 3 remained absent.
(f) The Enquiry was then adjourned to 29.7.2005 and again adjourned to 4.8.2005 when
except Respondent No.3 (R. Amalraj), the other Respondents Nos.1, 2 and 4 attended the
proceedings, and requested for further postponement, while representing that on the next
date of the proceedings, they would either bring their "Defence Representative" or they
would themselves conduct their "defence" without seeking any further postponement
thereof. Accordingly, the Enquiry was finally adjourned to 19.8.2005 to be held "on day-
to-day basis until conclusion".
8. While on the one hand the respondents were seeking adjournments and taking time
from the Enquiry Officer in the said disciplinary proceedings, they, on the other hand,
moved the High Court of Madras by filing writ petitions under Article 226 of the
Constitution of India. The said writ petitions were marked as W.P. Nos. 26176, 26177,
26178 and 26179 of 2005. Interlocutory applications were also filed therein praying for
stay of proceedings in the departmental enquiry pursuant to the said charge-sheet dated
21st February, 2005 on the premise that on identical facts criminal cases had been filed
against them. An ad interim order of stay was granted by the High Court by an order of
16th August, 2005 stating - :-
"Though this Court generally did not entertain Writ Petitions relating to Charge-memos
on the ground that Criminal proceedings are pending, the question as to whether the
Departmental Proceedings and the Criminal case are based on identical and similar set of
facts and whether the Charge in the Criminal case is of the grave nature
@page-SC556
which involves complicated questions of law and facts are the factors to be examined in
the Writ Petitions."
The said interim order of stay was produced before the Enquiry Officer. As the interim
order of stay was granted only for a period of four weeks and the same having not been
extended the enquiry proceedings continued. One witness being MW1 was examined on
21st October, 2005. The said departmental enquiry also proceeded on 22nd October, 2005
but the respondents did not participate therein on which date MW2 was examined. Yet
again on 24th October, 2005, MW3 and MW4 were examined and the matter was
adjourned to 25th October, 2005 when MW5 and MW6 were examined. On 26th
October, 2005, MW7 and MW8 were examined-in-chief and the enquiry was adjourned
to 27th October, 2005. Yet again on 28th October, 2005, MW9 and MW10 were
examined and the enquiry was adjourned to 29th October, 2005 on which date MW11
was examined. It is stated that the respondents attended the enquiry on 29th October,
2005 and nominated their Defence Representative to defend them. A prayer for
adjournment made on their behalf, however, was declined by the Enquiry Officer. MW11
was examined-in-chief on that date. The enquiry was adjourned to 31st October, 2005 on
which date MW12 and MW13 were examined-in-chief. It was adjourned to 9th
December, 2005 for cross-examination of the Management Witnesses.
9. The application for vacating the stay filed by the appellants on 6th September, 2005
was dismissed by a learned Single Judge of the High Court by an order dated 7th
December, 2005 stating - :-
"Once the Learned Single Judge has indicated the reasons which weighed with him in
exercising the extra-ordinary jurisdiction under Article 226 of the Constitution of India
against the impugned Charge-Memo, except to expedite the writ petitions, it may not be
proper for this Court to vacate the Interim Stay at this stage. Accordingly, the vacate stay
petitions, viz. WPMPs Nos. 2047 to 2050 of 2005 are dismissed. The Interim stay granted
by this Court on 16.8.2005 is made absolute.
Expedite the Writ Petitions and post the same for final hearing in the second week of
February, 2006."
10. Writ appeals preferred by the appellants against that order were disposed of by a
Division Bench of the Court by reason of the impugned judgment opining - :-
"14. In the instant case, there is no dispute that the criminal action and the disciplinary
proceedings are founded upon the same set of facts. In fact, the disciplinary proceedings
are solely based upon the criminal complaint lodged by the president of a rival union,
who is also facing prosecution with regard to the same incident. It has been conceded
before us that the bank had not conducted any independent enquiry before initiating the
impugned departmental proceedings.
15. In our opinion, in the peculiar facts and circumstances of the case on hand, fair play
requires that postponing of the departmental proceedings till the criminal cases are
decided. We are, therefore, of the view that the prayer made by the petitioners for
deferring the departmental proceedings till the conclusion of the criminal trial has to be
accepted and it is ordered accordingly."
11. The appellants are thus before us.
12

. Mr. Altaf Ahmed, learned senior counsel appearing on behalf of the appellants in
support of the appeal would, inter alia, submit that the High Court committed a serious
error in passing the impugned judgment in so far as it failed to take into consideration
that as the enquiry proceedings proceeded to a great extent the same should not have been
stayed. Reliance in this behalf has been placed on Kendriya Vidyalaya Sangathan and
others vs. T. Srinivas : (2004) 7 SCC 442. 2004 AIR SCW 4558

13

. Mr. G. Prakash, learned counsel appearing on behalf of the respondents, on the other
hand, submitted that the High Court having exercised its discretionary jurisdiction upon
application of law operating in this behalf, this Court should not exercise its jurisdiction
under Article 136 of the Constitution of India. Learned counsel urged that in a matter of
this nature where rival parties had clashed with each other and case and counter case have
been instituted one investigated by the Assistant Commissioner of Police and another by
an Inspector of Police, the respondents would be highly prejudiced if the departmental
proceedings are allowed to continue; particularly when the officers of the appellant-bank
have been proceeding with a bias. It was contended that the question as to whether there
exists any 2006 AIR SCW 2709
2004 AIR SCW 7290
2007 AIR SCW 304
@page-SC557
complicated question of law must be judged from the employees point of view, they
being belonging to the weaker section. Learned counsel would, in support of his
contention, strongly relied upon G.M. Tank vs. State of Gujarat and others : (2006) 5
SCC 446 ; Hindustan Petroleum Corporation Ltd. and others vs. Sarvesh Berry : (2005)
10 SCC 471 and Sathi Vijay Kumar vs. Tota Singh and others : 2006 (14) Scale 199.
14. Before embarking upon the rival contentions of the parties we may notice that
Respondent Nos. 1 to 4 have filed an application for quashing the order taking
cognizance against them before the High Court under Section 482 of the Code of
Criminal Procedure which was marked as Crl. O.P. No. 18163 of 2006 and by an order
dated 17th July, 2006 further proceedings in the criminal case have been stayed.
15. Legal position operating in the field is no longer res integra. A departmental
proceedings pending a criminal proceedings does not warrant an automatic stay. The
superior courts before exercising its discretionary jurisdiction in this regard must take
into consideration the fact as to whether the charges as also the evidence in both the
proceedings are common and as to whether any complicated question of law is involved
in the matter.
16

. In Delhi Cloth and General Mills Ltd. vs. Kushal Bhan : AIR 1960 SC 806 this Court
while holding that the employer should not wait for the decision of the criminal court
before taking any disciplinary action against the employee and such an action on the part
of the employer does not violate the principle of natural justice, observed - :- (Para
3)

"We may, however, add that if the case is of a grave nature or involves questions of fact
or law, which are not simple, it would be advisable for the employer to wait the decision
of the trial court, so that the defence of the employee in the criminal case may not be
prejudiced."
The same principle was reiterated in Tata Oil Mills Co. Ltd. vs. The Workmen : AIR 1965
SC 155.
17

. In State of Rajasthan vs. B.K. Meena and others : (1996) 6 SCC 417 this Court held - :-
1996 AIR SCW 4160, (Para 14)

"The staying of disciplinary proceedings, it is emphasised, is a matter to be determined


having regard to the facts and circumstances of a given case and that no hard and fast
rules can be enunciated in that behalf. The only ground suggested in the above decisions
as constituting a valid ground for staying the disciplinary proceedings is "that the defence
of the employee in the criminal case may not be prejudiced." This ground has, however,
been hedged in by providing further that this may be done in cases of grave nature
involving questions of fact and law. In our respectful opinion, it means that not only the
charges must be grave but that the case must involve complicated questions of law and
fact. Moreover, 'advisability', 'desirability' or 'propriety', as the case may be, has to be
determined in each case taking into consideration all the facts and circumstances of the
case."
18

. Capt. M. Paul Anthony v. Bharat Gold Mines Ltd. and another : (1999) 3 SCC 679 also
deserves to be noticed. This Court therein held that the departmental proceedings need
not be stayed during pendency of the criminal case save and except for cogent reasons.
The Court summarized its findings as under - :- 1999 AIR SCW 1098

"(i) Departmental proceedings and proceedings in a criminal case can proceed


simultaneously as there is no bar in their being conducted simultaneously, though
separately.
(ii) If the departmental proceedings and the criminal case are based on identical and
similar set of facts and the charge in the criminal case against the delinquent employee is
of a grave nature which involves complicated questions of law and fact, it would be
desirable to stay the departmental proceedings till the conclusion of the criminal case.
(iii) Whether the nature of a charge in a criminal case is grave and whether complicated
questions of fact and law are involved in that case, will depend upon the nature of
offence, the nature of the case launched against the employee on the basis of evidence
and material collected against him during investigation or as reflected in the charge sheet.
(iv) The factors mentioned at (ii) and (iii) above cannot be considered in isolation to stay
the Departmental proceedings but due regard has to be given to the fact that the
@page-SC558
departmental proceedings cannot be unduly delayed.
(v) If the criminal case does not proceed or its disposal is being unduly delayed, the
departmental proceedings, even if they were stayed on account of the pendency of the
criminal case, can be resumed and proceeded with so as to conclude them at an early
date, so that if the employee is found not guilty his honour may be vindicated and in case
he is found guilty, the administration may get rid of him at the earliest."
19

. The issue came up for consideration yet again in T. Srinivas (supra) where this Court
while analyzing B.K. Meena (supra) and Capt. M. Paul Anthony (supra) held that - :-
2004 AIR SCW 4558, (Para 11)
1996 AIR SCW 4160
1999 AIR SCW 1098

"From the above, it is clear that the advisability, desirability or propriety, as the case may
be, in regard to a departmental enquiry has to be determined in each case taking into
consideration all facts and circumstances of the case. This judgment also lays down that
the stay of departmental proceedings cannot be and should not be a matter of course."
20. The High Court, unfortunately, although noticed some of the binding precedents of
the Court failed to apply the law in its proper perspective. The High Court was not correct
in its view in concluding that the stay of the departmental proceedings should be granted
in the peculiar facts and circumstances of the case without analyzing and applying the
principle of law evolved in the aforementioned decisions. It, therefore, misdirected itself
in law. What was necessary to be noticed by the High Court was not only existence of
identical facts and the evidence in the matter, it was also required to take into
consideration the question as to whether the charges levelled against the delinquent
officers, both in the criminal case as also the disciplinary proceedings, were same.
Furthermore it was obligatory on the part of the High Court to arrive at a finding that the
non stayed of the disciplinary proceedings shall not only prejudice the delinquent officers
but the matter also involves a complicated question of law.
21. The standard of proof in a disciplinary proceedings and that in a criminal trial is
different. If there are additional charges against the delinquent officers including the
charges of damaging the property belonging to the bank which was not the subject matter
of allegations in a criminal case, the departmental proceedings should not have been
stayed.
22. Furthermore Respondent Nos. 1 to 4 have now moved the High Court for quashing of
the order taking cognizance of offence against them in the criminal proceedings. The
criminal proceedings have been stayed. Thus, even applying the principle laid down in
Capt. M. Paul Anthony (supra) the impugned judgment cannot be sustained. Before the
High Court no contention was raised that because Respondent Nos. 1 to 4 are office
bearers of a trade union, the authorities were biased against them. Nothing has been
shown that any complicated question of law arose for determination in the criminal case.
23

. Reliance placed by Mr. Prakash on Hindustan Petroleum Corporation Ltd. (supra) is not
apposite. There were certain special features which were noticed by this Court. In that
case itself it was held - :- 2004 AIR SCW 7290, (Para 10)

"There can be no strait-jacket formula as to in which case the departmental proceedings


are to be stayed. There may be cases where the trial of the case get prolonged by the
dilatory method adopted by the delinquent official. He cannot be permitted to, on one
hand, prolong the criminal case and at the same time contend that the departmental
proceedings should be stayed on the ground that the criminal case is pending.
(Emphasis supplied)
Therein the departmental proceedings were allowed to continue despite the fact that the
delinquent officer therein had been charged for commission of an offence under Section
13(1)(e) read with Section 13(2) of the Prevention of Corruption Act, 1988.
24

. In G.M. Tank (supra) this Court was dealing with a case where the delinquent officer
was acquitted. The said decision has no application in the instant case. 2006 AIR
SCW 2709

25

. Sathi Vijay Kumar (supra) pertains to a case involving election dispute. The question
which arose therein was as to whether despite the fact that there was no provision in the
Representation of the People 2007 AIR SCW 304
@page-SC559
Act, 1961 for striking out the pleadings, the Tribunal had the power to do so. We are not
concerned with such a question in this matter.
26. Furthermore the discretionary writ jurisdiction under Article 226 of the Constitution
of India should be exercised keeping in view the conduct of the parties. Respondents
made a representation that in the event the order of suspension is revoked, they would co-
operate with the Enquiry Officer. They kept on filing applications for extension of time
which were allowed. They took benefit thereof. Without, however filing show cause, they
moved the High Court. Furthermore before the Enquiry Officer also, as noticed
hereinbefore, although they had appointed the defence counsel, did not cross-examine the
witnesses examined on behalf of the Management. A large number of witnesses had
already been examined on behalf of the appellants. The disciplinary proceedings, as we
have noticed hereinbefore, have proceeded to a great extent. In such a situation we are of
the firm view that the discretionary jurisdiction should not have been exercised in favour
of Respondents 1 to 4 by the High Court.
27. For the reasons abovementioned the impugned judgment cannot be sustained which is
hereby set aside. The appeal is accordingly allowed.
28. We would, however, like to observe that in the event any prayer is made by the
respondents to cross-examine the witnesses examined on behalf of the appellants, the
Enquiry Officer may consider the same in accordance with law. Keeping in view the
conduct of the respondents they are directed to bear the costs of the appellants both
before the High Court as also before us. Counsel's fee assessed at Rs.25,000/-.
Appeal allowed.
AIR 2008 SUPREME COURT 559 "Dir. S. C. T. I. for Med. Sci. and Tech. v. M.
Pushkaran"
(From : Kerala)*
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Civil Appeal No. 5368 of 2007 (arising out of SLP (C) No. 6619 of 2007), D/- 23 -11
-2007.
Dir. S. C. T. I. for Med. Sci. and Tech. and Anr. v. M. Pushkaran.
(A) Constitution of India, Art.16 - EQUALITY IN PUBLIC EMPLOYMENT -
APPOINTMENT - SERVICE MATTERS - Appointment - Select listed candidates - Do
not have vested right to appointment - Unless mala fide of employer is proved - No
direction for appointment would be issued. (Para 16)
(B) Constitution of India, Art.16 - EQUALITY IN PUBLIC EMPLOYMENT -
APPOINTMENT - SERVICE MATTERS - POLICY DECISION - Appointment -
Vacancies of posts of Security Guards advertised - Select list prepared - Appointment
made to two of three vacant posts - Subsequent policy decision to contract out services of
Guards - Refusal to appoint person in select list on third vacant post in view of new
policy - Improper - Selected person was to be offered appointment at a point of time
when no policy decision was taken or was even in contemplation - There was thus no
reason to refuse appointment. (Para 18)
Cases Referred : Chronological Paras
2007 AIR SCW 5729 (Ref.) 17
2007 AIR SCW 5989 (Ref.) 17
2007 AIR SCW 6967 (Ref.) 17
2006 AIR SCW 4930 : 2006 Lab IC 4195 (Ref.) 17
2005 AIR SCW 2120 : AIR 2005 SC 2775 (Rel. on) (Pt.A) 15
2004 AIR SCW 5768 : AIR 2004 SC 5061 9, 17
2001 AIR SCW 1720 : AIR 2001 SC 1851 : 2001 Lab IC 1726 (Rel. on) Pt. A) 17
1999 AIR SCW 4300 : AIR 2000 SC 205 (Ref.) 14
1996 AIR SCW 691 : AIR 1996 SC 1145 : 1996 Lab IC 957 9
1995 AIR SCW 2044 : 1995 Lab IC 1775 (Rel. on) (Pt-A) 13
1993 AIR SCW 2314 (Rel. on) (Pt. A) 14
1991 AIR SCW 1583 : AIR 1991 SC 1612 : 1991 Lab IC 1460 (Rel. on) Pt. A) 9, 12,
17
AIR 1987 SC 169 : 1987 Lab IC 34 12
AIR 1987 SC 331 : 1987 Lab IC 447 14
AIR 1984 SC 1850 12
AIR 1977 SC 276 : 1977 Lab IC 52 14
AIR 1973 SC 2216 : 1973 Lab IC 1212 12, 14
L. Nageshwara Rao, Sr. Advocate, Ragenth Basant, Ms. Liz Mathew, Senthil Jagadeesan,
for Appellants; P. S. Narasimha, M. Gireesh Kumar, Khwairakpam Nobin Singh, for
Respondent.
* W. A. No. 2075 of 2006, D/- 4-12-2006 (Ker).
Judgement
S. B. SINHA, J. - :-Leave granted.
2. A short question which arises for
@page-SC560
consideration in this appeal is as to whether the respondent herein had any legal right for
being appointed against the post of three security guards advertised by the appellant
institute.
3. The basic fact of the matter is not in dispute. An advertisement was issued for
appointment to the post of security guards. There were three permanent posts. The select
list contained names of five candidates. The name of the respondent appeared at Sl. No. 4
therein. It was finalized on 11.04.2005. It had a validity period of one year i.e. upto
10.04.2006. Whereas two candidates were offered appointments on 13.04.2005 and
5.05.2005, the third candidate was offered appointment on 13.06.2005. He declined the
same. Respondent, however, for reasons best known to the appellant, was not offered any
appointment. He filed a writ petition questioning his non-appointment on 12.12.2005.
4. On or about 13.07.2005, however, a purported policy decision was taken to contract
out some of the services in a phased manner to make the administration efficient and cost
effective in the following terms - :
"After detailed deliberations, it was resolved that (i) a copy of the request sent to the
Employment Exchange, Thiruvanantha-puram may simultaneously be circulated/ posted
by the Institute to all the Employment Exchanges in Kerala especially in case of direct
recruitment of Group D posts specifying the number of candidates to be sponsored for
each post so as to achieve a wider coverage; (ii) in the case of Group C and B Direct
recruitment posts, paper advertisement shall, continue to be resorted in one or two
leading newspapers and (iii) for temporary vacancies/leave vacancies of Cleaning
Attendants/Security Guards, the external contract system prevalent in BMT Wing may be
extended to the Hospital Wing also in a phased manner."
5. A resolution was adopted by the Governing Body in a meeting held at the Institute on
29.12.2005 in the following terms - :
"We have been deliberating for quite sometime on contracting out some of the services on
a phased manner to make it more efficient and cost effective. It is noted that the security
at BMT Wing, Poojappura that was contracted out on a trial basis has been found
successful.
It was noted that at present there are 2 permanent vacancies of Security Guards and 2
permanent posts of Drivers that are lying vacant.
It was resolved to abolish these vacant posts and services may be contracted out/ hired
and ratify the decision of the Director not to fill the two vacant posts of Security Guards
and Drivers on permanent basis."
6. A learned Single Judge of the High Court by a judgment and order dated 20.09.2006
inter alia opined - :
"5. I do not think that the petitioner has made out a case for interference. No doubt, the
petitioner approached this Court on 12.12.2005. Ext. R1(b) decision is dated 29.12.2005.
But, I do not think that that is sufficient to overturn the decision of the management. The
question as to which are the posts to be filled up, is all a management decision.
Ordinarily, it is not for this Court to veto the wisdom of the employer in regard to the
posts which are to be retained and posts which are to be abolished. A decision to abolish a
post cannot be attacked by a person figuring in a rank list, unless, no doubt, an
extraordinarily case of malice or per se arbitrary action is established. Apparently, the
respondents felt that the post need not be retained, having regard to the advantages that
would flow from contracting of these services as also the pecuniary loss that would
otherwise flow. It is hard to characterize such a decision as arbitrary, as sought to be
shown in the Reply Affidavit. It is settled law that a person in the rank list has no legal
right to command the employer to appoint him. This is not a case where after having
taken a decision to fill up the posts, the respondent is not offering appointment to the
petitioner. Ext. R1(b) is not challenged by petitioner. In such circumstances, the Writ
petition fails and it is dismissed."
7. On an intra-court appeal preferred by the respondent herein from the said judgment
and order, the Division Bench, however, reversed the same, inter alia, holding - :
"...If the vacancy was abolished necessarily there was no question of appointment either
on substantial or on temporary basis. There is a decision to fill it up on temporary basis.
Thus, contract appointment reveal the existence of the vacancy. The 3rd among the
vacancies notified was one really intended to be filled up even on 13.6.2005 when the 3rd
rank holder in the list had been offered appointment. The decision contained in
@page-SC561
Ext. - R1(b) is the decision taken by the Governing Body. The petitioner/appellant need
not challenge the decision taken by the Governing Body, when there is no decision in
Ext. R1(b) to abolish the post but only to fill up the permanent posts on contract basis.
Then, the next person included in the list for regular appointment has to be considered..."
8. Appellants are, thus, before us - :
9. Mr. L. Nageshwara Rao, learned senior counsel appearing on behalf of the appellants,
submitted that the Division Bench of the High Court committed a serious error in holding
that there was a vacancy on a temporary basis.
It was urged that keeping in view a number of decisions of this Court, the impugned
judgment is wholly unsustainable. Reliance in this behalf has been placed on
Shankarasan Dash v. Union of India [(1991) 3 SCC 47], State of Bihar and Others v. Md.
Kalimuddin and Others [(1996) 2 SCC 7] and Punjab State Electricity Board and Others
v. Malkiat Singh[(2005) 9 SCC 22]. 1991 AIR SCW 1583
1996 AIR SCW 691
2004 AIR SCW 5768

10. Mr. P.S. Narasimha, learned counsel appearing on behalf of the respondent, on the
other hand, would submit that the institution had four departments. In some of the
departments a policy decision to contract out the services was taken; but, so far as the
department in which the respondent was to be appointed, no policy decision had been
adopted for contracting out the job of the security persons and in that view of the matter
the respondent had a legitimate expectation of his being appointed.
11. The law operating in the field in this behalf is neither in doubt nor in dispute. Only
because the name of a person appears in the select list, the same by itself may not be a
ground for offering him an appointment. A person in the select list does not have any
legal right in this behalf.
The selectees do not have any legal right of appointment subject, inter alia, to bona fide
action on the part of the State. We may notice some of the precedents operating in the
field.
12

. In Shankarsan Dash v. Union of India [(1991) 3 SCC 47], this Court held - : 1991
AIR SCW 1583

"7 . It is not correct to say that if a number of vacancies are notified for appointment and
adequate number of candidates are found fit, the successful candidates acquire an
indefeasible right to be appointed which cannot be legitimately denied. Ordinarily the
notification merely amounts to an invitation to qualified candidates to apply for
recruitment and on their selection they do not acquire any right to the post. Unless the
relevant recruitment rules so indicate, the State is under no legal duty to fill up all or any
of the vacancies. However, it does not mean that the State has the licence of acting in an
arbitrary manner. The decision not to fill up the vacancies has to be taken bona fide for
appropriate reasons. And if the vacancies or any of them are filled up, the State is bound
to respect the comparative merit of the candidates, as reflected at the recruitment test, and
no discrimination can be permitted. This correct position has been consistently followed
by this Court, and we do not find any discordant note in the decisions in State of Haryana
v. Subhash Chander Marwaha, Neelima Shangla v. State of Haryana, or Jatendra Kumar
v. State of Punjab." AIR 1973 SC 2216
AIR 1987 SC 169
AIR 1984 SC 1850

13
. Yet again in R.S. Mittal v. Union of India [1995 Supp (2) SCC 230], this Court held - :
1995 AIR SCW 2044

"It is no doubt correct that a person on the select panel has no vested right to be appointed
to the post for which he has been selected. He has a right to be considered for
appointment. But at the same time, the appointing authority cannot ignore the select panel
or decline to make the appointment on its whims. When a person has been selected by the
Selection Board and there is a vacancy which can be offered to him, keeping in view his
merit position, then, ordinarily, there is no justification to ignore him for appointment.
There has to be a justifiable reason to decline to appoint a person who is on the select
panel. In the present case, there has been a mere inaction on the part of the Government.
No reason whatsoever, not to talk of a justifiable reason, was given as to why the
appointments were not offered to the candidates expeditiously and in accordance with
law. The appointment should have been offered to Mr Murgad within a reasonable time
of availability of the vacancy and thereafter to the next
@page-SC562
candidate. The Central Government's approach in this case was wholly unjustified."
(Emphasis supplied)
14

. In Asha Kaul (Mrs.) and Another v. State of Jammu and Kashmir [(1993) 2 SCC 573],
this Court held - : 1993 AIR SCW 2314

"8. It is true that mere inclusion in the select list does not confer upon the candidates
included therein an indefeasible right to appointment (State of Haryana v. Subhash
Chander Marwaha; Mani Subrat Jain v. State of Haryana; State of Kerala v. A.
Lakshmikutty) but that is only one aspect of the matter. The other aspect is the obligation
of the Government to act fairly. The whole exercise cannot be reduced to a farce. Having
sent a requisition/request to the Commission to select a particular number of candidates
for a particular category, in pursuance of which the Commission issues a notification,
holds a written test, conducts interviews, prepares a select list and then communicates to
the Government - the Government cannot quietly and without good and valid reasons
nullify the whole exercise and tell the candidates when they complain that they have no
legal right to appointment. We do not think that any Government can adopt such a stand
with any justification today..." AIR 1973 SC 2216
AIR 1977 SC 276
AIR 1987 SC 331

{[See also A.P. Aggarwal v. Govt. of NCT of Delhi and Another [(2000) 1 SCC 600]}.
1999 AIR SCW 4300

15
. In Food Corpn. Of India and Others v. Bhanu Lodh and Others [(2005) 3 SCC 618], this
Court held - : 2005 AIR SCW 2120

"14. Merely because vacancies are notified, the State is not obliged to fill up all the
vacancies unless there is some provision to the contrary in the applicable rules. However,
there is no doubt that the decision not to fill up the vacancies, has to be taken bona fide
and must pass the test of reasonableness so as not to fail on the touchstone of Article 14
of the Constitution. Again, if the vacancies are proposed to be filled, then the State is
obliged to fill them in accordance with merit from the list of the selected candidates.
Whether to fill up or not to fill up a post, is a policy decision, and unless it is infected
with the vice of arbitrariness, there is no scope for interference in judicial review."
16. It is, therefore, evident that whereas the selectee as such has no legal right and the
superior court in exercise of its power of judicial review would not ordinarily direct
issuance of any writ in absence of any pleading and proof of mala fide or arbitrariness on
the part of the employer. Each case, therefore, must be considered on its own merit.
17

. In All India SC and ST Employees Association and Another v. A. Arthur Jeen and
Others [(2001) 6 SCC 380], it was opined - : 2001 AIR SCW 1720

"10. Merely because the names of the candidates were included in the panel indicating
their provisional selection, they did not acquire any indefeasible right for appointment
even against the existing vacancies and the State is under no legal duty to fill up all or
any of the vacancies as laid down by the Constitution Bench of this Court, after referring
to earlier cases in Shankarsan Dash v. Union of India. 1991 AIR SCW 1583

[See also Malkiat Singh (supra), Pitta Naveen Kumar and Others v. Raja Narasaiah
Zangiti and Others (2006) 10 SCC 261, State of Rajasthan and Ors. v. Jagdish Chopra
2007 (10) SCALE 470, Union of India and Others v. S. Vinodh Kumar and Others, 2007
(11) SCALE 257 and State of M.P. and Ors. v. Sanjay Kumar Pathak and Ors. 2007 (12)
SCALE 72]. 2004 AIR SCW 5768
2006 AIR SCW 4930
2007 AIR SCW 5729
2007 AIR SCW 5989
2007 AIR SCW 6967

18. The application of law would, therefore, depend upon the fact situation obtaining in
each case. The judgment of the High Court in view of the aforementioned authoritative
pronouncements cannot be said to be perverse. The respondent was to be offered with the
appointment at a point of time when no policy decision was taken. There was, thus, no
reason not to offer any appointment in his favour. Why the select panel was ignored has
not been explained. Even the purported policy decision was not in their contemplation.
We, therefore, do not see any reason to interfere with the impugned judgment.
19. Furthermore, the respondent is an ex-serviceman. He in ordinary case should have
been offered appointment particularly when three posts were vacant. The decision to
abolish posts was not taken at a point of
@page-SC563
time when he had filed the writ petition. It was expected that on 16.06.2005 when the
third candidate refused to join the post, he should have been offered the same.
20. The policy decision to abolish the posts as also contracting out the security services
was taken by the appellant much thereafter, viz., on or about 29.12.2005. We are,
therefore, of the opinion that it is not a fit case where we should interfere with the
impugned judgment. The appeal is dismissed. No costs.
Appeal dismissed.
AIR 2008 SUPREME COURT 563 "T. Vijendradas v. M. Subramanian"
(From : AIR 2006 Mad 288)
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Civil Appeal No. 4727 of 2007 (arising out of SLP (C) No. 17549 of 2006), D/- 9 -10
-2007.
T. Vijendradas and Anr. v. M. Subramanian and Ors.
Civil P.C. (5 of 1908), O.21, R.92(4), O.34, R.1 - AUCTION SALE - MORTGAGE -
OBJECT OF AN ACT - MUNICIPALITIES - SUPREME COURT - Object of - Suit for
recovery of statutory charge by Municipality against owner of property - Owner not
disclosing that he had already sold property and allowing ex parte decree to be passed -
Auction sale - Upset price reduced twice without intimation to judgment-debtor -
Property purchased in auction by wife of judgment-debtor vendor - Suit by first purchaser
for declaration and possession against vendor and his wife - Municipality not made party
- Supreme Court in its jurisdiction under Art. 142 of Constitution, considering object of
O. 21, R. 92(4) and (5) directed plaintiff-first purchaser to pay amount which Court paid
to Municipality out of auction amount and also pay amount of property tax to
Municipality.
Constitution of India, Art.142.
T.N. District Municipalities Act (5 of 1920), S.85.
One of the objects sought to be achieved in amending O. 21, R. 92 was to do complete
justice to the parties so as to enable the auction-purchaser to get back the amount from
the decree-holder and revive the execution proceedings so that the decree-holder may
proceed against the judgment-debtor for realisation of the decretal amount.(Para 28)
In a suit for recovery of a meagre amount filed by the Municipalities against the property
owner, the property owner did not disclose that he had already sold the property and ex
parte decree was passed. In execution of decree, property was sold in auction. While
holding auction upset price was reduced twice without intimation to judgment-debtor.
Property was purchased in auction by the wife of judgment- debtor, without disclosing
the relationship. Having learnt the fact of auction sale, the first purchaser filed a suit for
declaration and possession against her vendor and his wife i.e. the auction-purchaser.
Municipality, however, was not impleaded in the suit. Supreme Court in such case
observed that as the defendants were guilty of "suppressio veri" and in the event of any
conflicting interest, Supreme Court in exercise of its equity jurisdiction under Art. 142 of
the Constitution of India should weigh the effect of a fraud and the consequence of non-
impleadment of a necessary party. It was, therefore, held that the scale of justice weighs
in favour of the person who is a victim of fraud and, thus, any relief should not be refused
in his favour, only because he might have been wrongly advised. The purport and object
for which O. - 21, R. 92(5) was enacted furthermore would be better subserved if it is
directed that the plaintiff shall pay amount which Court paid to Municipality out of
amount of auction. It was further observed by the Supreme Court that the plaintiffs had
not claimed any relief against the Municipality. The Municipality's right to realise the
amount of property tax together with interest, if any, was not in dispute. Although the
liability of owner in terms of the 1920 Act to pay the property tax continued, the plaintiffs
was also liable to pay the amount of property tax after the date of sale. In a case of this
nature, therefore, the plaintiffs can be directed to pay the amount of property tax by way
of redemption of mortgage in favour of the Municipality and that if any amount is
available with Court out of amount received from auction sale, same may be paid to the
defendants. (Paras 27, 28, 29, 31)
Cases Referred : Chronological Paras
2007 AIR SCW 2212 : AIR 2007 SC 1546 (Ref.) 15
2007 AIR SCW 3734 : AIR 2007 SC 1971 23
2007 (3) Scale 349 24
@page-SC564

2006 AIR SCW 4905 : AIR 2006 SC 3359 (Ref.) 14


2004 AIR SCW 4462 : AIR 2004 SC 4504 : 2004 Lab IC 3206 (Ref.) 21
2003 AIR SCW 3518 : AIR 2003 SC 2889 23
(2003) 8 SCC 319 14
2002 AIR SCW 2658 : AIR 2002 SC 2426 : 2002 Lab IC 2324 (Ref.) 21
1994 AIR SCW 243 : AIR 1994 SC 853 14
AIR 1979 SC 1682 22
AIR 1967 SC 1390 (Ref.) 25
AIR 1963 SC 786 (Disting.) 22
K. V. Viswanathan, K. V. Venkataramani, B. Ragunath and R. Nedumaran, for Appellants;
K. Parasaran, Sr. Advocate Mrs. V. Mohana, Ms. Hari Priya and Anirudh Sharma, for
Respondents.
Judgement
1. S. B. SINHA, J. - :-Leave granted.
2. A short but interesting question in regard to interpretation of Order XXI, Rule 92(4) of
the Code of Civil Procedure, 1908 (for short, 'CPC') is involved in this appeal.
Facts :
3. R. Venugopal (since deceased), original defendant No. 3, was the owner of the suit
property consisting of 8 cents and 116 sq. ft. of land situated within the Coimbatore
Municipal Corporation (for short, 'the Municipality'). He transferred his right, title and
interest therein by reason of a registered deed of sale in favour of one Sakunthala, the
original plaintiff No. 1 in the suit and mother of Respondent Nos. 1 and 2 herein. It is,
however, not in dispute that the factum of sale was not intimated to the authorities of the
Municipality either by the vendor or by the vendee thereof. The vendee's name was not
mutated in the records of the Municipality. Indisputably, property tax in respect of
premises in question had not been paid for the period from 01.04.1970 to 31.03.1973.
The property tax for two quarters, thus, was to be paid by Venugopal whereas the rest was
to be paid by the vendee. The matter relating to payment of property tax is governed by
the Tamil Nadu District Municipalities Act (Tamil Nadu Act V of 1920) (for the sake of
brevity, hereinafter called and referred to as 'the 1920 Act').
4. With a view to enforce a statutory charge as laid down in the 1920 Act, the
Municipality filed a suit, which was marked as O.S. No. 986 of 1973. Sakunthala was not
a party therein. Venugopal although entered his appearance in the suit but at the
subsequent stages, did not appear. Yet again he did not inform the court about the fact that
he had sold the property in favour of Sakunthala. He allegedly sent an information to
Sakunthala in regard thereto, but admittedly, the latter was sent at a wrong address.
The said suit was decreed in 1978. The Municipality filed an application for execution of
the said decree, which was marked as E.P. No. 2620 of 1978. The property in question
was put up on auction sale, the upset price wherefor was fixed at Rs. - 20,000/- by an
order dated 19.03.1979. However, as allegedly no buyer was available, an application for
reduction of upset price was filed being E.A. No. 284 of 1979 for bringing it down from
Rs. 20,000/- to Rs. 5,000/-. It was, however, directed to be reduced to Rs. 10,000/-, but
therefor no notice was issued to the judgment- debtor, as is required in terms of Order
XXI, Rule 66, CPC. Yet again without any other order being passed for further reduction
of the upset price, the suit property was sold on auction for a sum of Rs. 8,010/- in favour
of one Manickam, original defendant No. 1, on 06.08.1979.
5. It will be appropriate to place on record that although at one point of time there existed
a dispute as to whether the said Manickam was the wife of Venugopal or not, it stands
accepted that a relationship of husband and wife had been existing by and between them.
The said auction sale was not only confirmed by an order dated 11.10.1979, but a sale
certificate was also issued on or about 04.12.1979. An application for withdrawal of the
said auction amount was filed by the Municipality, which had been allowed and a cheque
was directed to be issued in its favour. The said order was complied with on 20.02.1981.
6. Manickam allegedly sold the said property in favour of one M/s. Ramans for a sum of
Rs.41,066/- by a registered deed of sale dated 22.08.1981. Having learnt that the property
in question had been sold in auction, Sakunthala filed a suit for declaration and
possession, against her vendor, his mother and wife on or about 27.08.1981. The plaintiff
then allegedly had no knowledge in regard to the sale of the said property in favour of
one M/s. Ramans. In her written statement, defendant No. 1 denied that she was the wife
of the judgment-debtor and disclosed that she had sold the
@page-SC565
property during the pendency of the said suit. M/s. Ramans despite knowledge of the
pendency of the suit sold the said property in favour of the appellants herein. M/s.
Ramans and the appellants herein thereafter on an application made in that behalf were
impleaded as defendants in the said suit. Indisputably, in their written statement, the
appellants raised a plea that the Municipality was a necessary party. The said suit was
decreed by a judgment and decree dated 19.12.1996. An appeal thereagainst preferred by
the appellants has been dismissed by a judgment and order dated 12.01.1999. A Second
Appeal preferred by the appellants has also been dismissed.
Submissions - :
7. The principal contentions raised in this appeal by Mr. K.V. Viswanathan, learned
counsel for the appellants are - :
(i) In view of the mandatory provisions contained in sub-rule (4) of Rule 92 of Order
XXI, CPC, the decree-holder was a necessary party and in its absence the judgment and
decree passed by the courts below are nullities.
(ii) In terms of Order I, Rule 9, CPC, non-impleadment of a necessary party would render
a suit not maintainable.
(iii) Sakunthala having questioned the title of Venugopal as on the date of holding of the
auction, in terms of the aforementioned provision, she was bound to implead the
Municipality as a party defendant in the suit.
(iv) The finding of commission of fraud as alleged by the plaintiff either on the part of the
Municipality or on the part of the appellants and his predecessors, would not render the
auction sale void.
(v) Had the Municipality been impleaded as a party, it could have shown that no fraud
had been committed on the court in the matter of holding of the auction.
(vi) The plaintiff having not examined herself, and only an auditor having been examined
on her behalf, an adverse inference should have been drawn in that regard by the courts
below.
8. Mr. K. Parasaran, learned Senior Counsel appearing on behalf of the respondents, on
the other hand, would submit - :
(i) A specific plea of fraud having been raised on the part of the auction purchaser, who
was wife of the judgment-debtor and the defendant in the suit, and a finding of fact in that
behalf having been arrived at by the trial court as also by the appellate court, the
Municipality cannot be said to be a necessary party.
(ii) The plaintiffs-respondents had rightly been held to have not raised any contention in
regard to commission of fraud on the part of the Municipality, as has been held by the
learned Trial Judge as also the Appellate Court, it was not a necessary party to the suit.
(iii) The suit as framed did not attract the provisions of Order XXI, Rule 92, CPC, as a
decree passed in favour of the judgment-debtor Venugopal was a mortgage decree, as
contemplated under Order XXXIV, Rule 1, CPC vis-a-vis the Transfer of Property Act,

(iv) Order XXI, Rule 92, in any event, must be given a contextual meaning.
(v) The principle of caveat emptor will be applicable in this case.
(vi) Appellants being purchasers pendent lite are bound by the decree passed by the
learned Trial Judge.
(vii) The position of the judgment-debtor 'Venugopal' being that of a trustee, as envisaged
under Section 88 of the Indian Trusts Act, 1882 it was obligatory on his part to protect the
interest of Sakunthala.
Statutory Provisions - :
9. Sections 85 and 88 of the 1920 Act, which are relevant for the purpose of adjudication
of this case, read as under - :
"85. Property tax a first charge on property.- The property tax on buildings and lands
shall, subject to the prior payment of land revenue, if any, due to the Government
thereon, be a first charge upon the said buildings or lands and upon the movable property,
if any, found within or upon the same and belonging to the person liable to such tax."
"88. Obligation of transferor and transferee to give notice of transfer.- (1) Whenever the
title of any person primarily liable to the payment of property tax on any premises to or
over such premises is transferred, the person whose title is transferred, and the person to
whom the same shall be transferred shall within three months after the execution of the
instrument of transfer or after its registration if it be registered or after the transfer is
effected, if no instrument be executed, give notice of such
@page-SC566
transfer to the Executive authority.
(2) In the event of death of any person primarily liable as aforesaid the person to whom
the title of the deceased shall be transferred, as heir or otherwise shall give written notice
of such transfer to the executive authority within one year from the death of the deceased.
(3) The notice to be given under this section shall be in such form as the executive
authority may direct and the transferee or the person to whom the title passes, as the case
may be, shall, if so required, be bound to produce before the executive authority any
documents evidencing the transfer or succession.
(4) Every person who makes a transfer as aforesaid without giving such notice to the
executive authority shall in addition to any other liability which he incurs through such
neglect, continue to be liable for the payment of property tax assessed on the premises
transferred until he gives notice or until the transfer shall have been recorded in the
municipal registers but nothing in this section shall be held to affect-
(a) the liability of the transferee for the payment of the said tax, or
(b) the prior claim of the municipal council under section 85".
Fraud - :
10. Relationship between Venugopal and Manickam is not disputed. A contention has,
however, been raised by the respondents themselves that Sakunthala was a national of
Malaysian origin. Venugopal and Manickam, as noticed hereinbefore, denied and
disputed their relationship of husband and wife. Despite such a stand taken at least before
the High Court, the same was given up. Keeping that aspect in view we may notice the
findings of the learned Trial Judge - :
"...The sale deed Ex.A.1 has been suppressed and an ex parte decree has been obtained in
that suit. It is a fraudulent act of Venugopal.........The suit property has been brought in
auction in E.P. No. 2620 of 1978 suppressing the already existing sale in favour of the
plaintiff Sakuntala. This Court therefore, considers that such an act is unjust and
fraudulent."
The First Appellate Court also found as under :
"...It is also clear that the 3rd respondent did not inform the plaintiffs/appellants that for
the arrears of property tax in respect of the property sold to them, a decree has been
obtained and that the 3rd respondent did not appear in court and inform the Court that he
had sold the property to the plaintiffs and hence the plaintiffs also should be impleaded as
parties to the suit. D.W.1, the 5th respondent examined on the side of the respondents, has
stated in his evidence that on 2.8.1978 Venugopal appeared in Court in the case filed by
the Corporation, that Venugopal had means to pay the arrears of tax of Rs. 406/- and that
even after the decree in the said suit, Venugopal did not pay the arrears of property tax of
Rs. 406/-. It is therefore, clear that the 3rd respondent has acted fraudulently by not
paying the arrears of tax even after the sale in favour of the plaintiffs, though he had
means to pay and the plaintiffs were also not informed about the same.........Even when
the property was brought for auction, the 3rd respondent did not contest it. Though the
property tax arrears is a small amount of Rs. 406/-, he has not chosen to pay the same.
It was further found - :
"The 3rd respondent in his written statement has stated that the 1st respondent is not his
wife, that the 1st respondent in the written statement has stated that the 3rd respondent is
not her husband and that she is not married........The fraudulent conduct is very clear from
their statement in their written statement that the 1st respondent is not the wife of the 3rd
respondent. There is no doubt that Corporation has filed a suit for recovery of a small
amount of Rs. 406.76 towards arrears of property tax and obtained a decree, which was
followed by execution proceedings, which was also not contested, that wantonly allowing
all the proceedings to go on, the 3rd res-pondent, through his wife, fraudulently took the
property in auction for Rs. 8,010/-..."
The Court held - :
"...The 3rd respondent in his written statement has stated that though it is not necessary
for him to inform anything about the proceedings to anybody regarding the auction sale,
he informed the plaintiff by registered post and that under those circumstances there is no
chance to say that he acted fraudulently. It was stated by the learned counsel for the
appellants that on the side of the respondents, in support of the above, Ex. B.1 has been
filed. A perusal
@page-SC567
of Ex. B.1 shows that the registered post has been returned stating that there is no such
addressee. In the above registered post, the address found is M. Sakunthala, wife of
Muthyya Chettiar, Thisoolpadam, Thirupathur Post, Ramanathapuram District. But it is
clear from the plaint documents that the place of plaintiff-Sakunthala is "Siruoodalpatti
village, Tirupathur Taluk, Sivaganga District. There is no doubt that the 3rd respondent
want only sent the registered post giving a false address, got it returned and filing it into
Court is clearly a continuation of his fraudulent action".
11. Although not very relevant, but we may notice that the vendor had never paid the
arrears of property tax to the Municipality. He had other properties and the quantum of
tax for which the suit was filed was only Rs. 406.76. A further finding of fact had been
arrived at that despite knowledge, no notice was sent to Sakunthala at her known address
i.e. Sirukoodalpatti Village which was the address disclosed in the sale deed, but sent to
another address. In the suit only the registered cover had been filed but the contents
thereof had not been disclosed. It was obligatory on the part of the appellant to bring the
office copy of the said notice on the record.
On the basis of the aforementioned findings, the courts below had arrived at a conclusion
that Venugopal had not been acting bona fide and an attempt had been made to create
evidence to cover up his fraud.
Statutory application - :
12. Section 55(1)(g) of the Transfer of Property Act, 1882 envisages payment of taxes in
respect of the property by the vendor up to the date of sale. The liability of the vendee to
pay the property tax arises only from the date of sale. However, Sections 85 and 88 of the
1920 Act provide that in the event, the factum of sale is not communicated, the liability of
the vendor shall continue. Consequently a statutory charge is created on the property. A
person having an interest in the property, therefore, might have a right of redemption. A
suit for realisation of the dues in respect of a property in respect whereof a statutory
charge is created, a suit could also be filed by the Municipality, apart from taking
recourse to the procedure provided for realisation of the said dues as land revenue.
13. A decree passed in terms of Order XXXIV, Rule 1, CPC is somewhat different from a
decree passed in an ordinary money suit. If in terms of the provisions of the statute,
plaintiffs-respondents are found to be liable to pay the property tax, at an appropriate
stage, they can redeem the charge. The plaintiffs-respondents did not claim any relief
against the Municipality. Its right, title and interest over the property having regard to the
statutory charge thereover has not been denied or disputed. It is also not a case where
fraud was alleged to have been committed by the Municipality either in conspiracy with
the judgment-debtor Venugopal or otherwise. What was contended was that having
regard to the fact that upset price was brought down without following the procedure as
contained in Order XXI, Rule 66, CPC, an irregularity or fraud was practised in the
context of the conduct of the auction sale. Irregularity committed in conducting the
auction sale and commission of fraud either on court or on a party to the suit stand
completely on different footings.
14. Mr. Viswanathan's contention that in effect and substance the plaint contained
allegation of fraud on Municipality, in our opinion, cannot be accepted. As is well-
known, the pleadings must be read in their entirety for the purpose of proper construction
thereof. What had been alleged in the plaint is the commission of fraud by Venugopal.
His conduct throughout the proceedings has been taken into consideration by the courts
below; viz., despite transferring the property he did not intimate thereabout to the
Municipality. Even when the suit was filed, he did not make any attempt to raise a plea
which was expected of any reasonable and prudent man that he ceased to be liable to pay
the property tax as he had already transferred the property. The purported intimation
given to the plaintiffs was also found to be an act of fraud on his part inasmuch as the
purported notice to the plaintiff had deliberately been sent at a wrong address. The
contents of the notice had also not been brought on record. Despite having sufficient
means he voluntarily suffered an ex parte decree. He never objected to reduction of upset
price. He despite the fact did not contest the suit, participated in the auction sale and
purchased the property in the name of his wife. Not only that the auction-purchaser sold
the property to a third party, who again despite the knowledge of pendency of the suit
@page-SC568
transferred the property in favour of the appellants.

The effect of commission of such fraud either on court or on a party is no longer res
integra. [See S.P. Chengalvaraya Naidu (Dead) by LRs. v. Jagannath (Dead) by L.Rs. and
others [(1994) 1 SCC 1]; Ram Chandra Singh v. Savitri Devi [(2003) 8 SCC 319] and
Tulsi and others v. Chandrika Prasad and others [(2006) 8 SCC 322]. 1994 AIR
SCW 243
2006 AIR SCW 4905

15

. In A.V. Papayya Sastry and others v. Govt. of A.P. and others [(2007) 4 SCC 221], it was
held - : 2007 AIR SCW 2212
"21. Now, it is well settled principle of law that if any judgment or order is obtained by
fraud, it cannot be said to be a judgment or order in law. Before three centuries, Chief
Justice Edward Coke proclaimed - :
"Fraud avoids all judicial acts, ecclesiastical or temporal."
22. It is thus settled proposition of law that a judgment, decree or order obtained by
playing fraud on the Court, Tribunal or Authority is a nullity and non est in the eye of
law. Such a judgment, decree or order - by the first Court or by the final Court - has to be
treated as nullity by every Court, superior or inferior. It can be challenged in any Court, at
any time, in appeal, revision, writ or even in collateral proceedings."
Non-impleadment of the Municipality in a suit - :
16. Keeping in view the principles of law, we may notice the effect of non-impleadment
of the Municipality, as envisaged under Order XXI, Rule 92(4) and Rule 92(5), CPC,
which reads as under - :
"92. Sale when to become absolute or be set aside-
(4) Where a third party challenges the judgment-debtor's title by filing a suit against the
auction-purchaser, the decree-holder and the judgment-debtor shall be necessary parties
to the suit.
(5) If the suit referred to in sub-rule (4) is decreed, the Court shall direct the decree-
holder to refund the money to the auction-purchaser, and where such an order is passed
the execution proceeding in which the sale had been held shall, unless the Court
otherwise directs, be revived at the stage at which the sale was ordered."
17. The purported allegations of the fraud on the Municipality in the plaint reads as under
-:
"IX The property originally proclaimed for sale at Rs. 20,000/-. The upset price was
allowed to be reduced on application without notice being issued to other side. The entire
execution is not only fraud but also irregular, illegal and void."
... ... ... ...
XI The property originally proclaimed for sale at Rs. 20,000. Due to irregularities in the
procedure and want of proper publication and publicity the sale did not take place and
there were series of application to reduce and upset price and the property ultimately sold
on the upset price fixed at Rs. 8000/-..."
The findings of the Trial Court on the said issue are as under - :
"...Ex A-9 is the copy of the interim application filed in the execution petition No. - 2620
of 1978 by the corporation. That application has been filed to reduce the upset price from
Rs. 20,000/- to 5,000/-. Further it has been stated in that petition that reduction of upset
price is prayed for on account of the fact that the house constructed in the suit property is
in a dilapidated condition. For the purpose of reduction of price, false details have been
furnished..........With the intention of suppressing the real facts from the eyes of the court,
it has been stated that there is a building in the suit property in a dilapidated
condition.......Further in that application it is stated that 12 years have lapsed after the
judgment in OS No. 986/73. But the judgment has been delivered in 1973. Execution
petition has been filed in 1978, 5 years after the judgment. While so, it is clear that the
said application contains allegations against the truth..."
18. It may be true that an observation had been made that the Municipality did so at the
instance of Venugopal, but there was no warrant for the following finding - :-
"...No notice has been given to the respondents in the petition filed for reduction of upset
price. Because of these defects in brining the property for auction in the execution
petition, it is clear that that there are legal flaws...."
It was also found - :
"It was argued on the side of the defendants that since Coimbatore Corporation
@page-SC569
has not been made a party to this suit, this suit has to be dismissed. This suit has been
filed for the relief of declaration that the suit property absolutely belongs to the plaintiff
on the basis of Ex. A.1. For deciding the right with regard to the suit property,
Corporation is not a necessary party. The powers to decide as to which property belongs
to whom has not been granted to the Corporation. Only a power to collect property tax is
vested with the Corporation. The Court, therefore, holds that in the suit filed to decide as
to whether the suit property belongs to the plaintiff or the defendants, the Corporation is
an unnecessary party. It is not necessary to implead Corporation as a party to decide the
disputes arising between the individuals. Further in the suit and in the execution
proceedings by the Corporation, Plaintiff Sakunthala is not a party. While so, this Court
holds that it is not necessary to add Corporation as a party to the suit. The Corporation
has also not sent any notice at any time stating that the suit property did not belong to the
plaintiffs. Hence this Court holds that so far as this case is concerned, the Corporation
need not be impleaded as a party. Hence this issue is answered against the defendants."
Such findings had been affirmed by the Appellate Court, stating - :
"A perusal of the above shows that the Corporation need not be impleaded as a party nor
any case to be filed to set aside the auction proceedings and this will not affect the
plaintiff's case in any way.
From the above, it is clear that the 3rd respondent has executed Ex. A.1 sale deed in
favour of the first plaintiff for valid consideration, which has not been denied by the 3rd
respondent, that the 1st respondent became entitled to the property so purchased later
under the court auction sale, which has been held to be invalid under law, this court hold
that the first plaintiff is entitled to a declaration that the suit property purchased under
Ex.A.1 belongs to the first plaintiff and after her plaintiffs 2 and 3 are entitled to the suit
property..."
19. We have noticed hereinbefore that a suit filed in terms of Order XXXIV, Rule 1, CPC
stands on a different footing. Non-joinder of a proper party in terms of Order I, Rule 9
would not render a suit not maintainable. We are, however, not oblivious of the purport
and object in amendment of Order XXI, Rule 92 CPC. The Law Commission in its 54th
Report recommended - :
"21.48D. Whatever be the correct view on the existing language, it appears to us that
something should be done to improve the position. No doubt, to permit the auction-
purchaser to sue for refund from the decree-holder, is to add to the troubles of the decree-
holder, and thus to delay execution. But that seems to be the only possible alternative. As
between the decree-holder and the auction-purchaser, if some one has to suffer, the
former should suffer.
It may not be feasible for the court to inquire into the title of the judgment-debtor (at the
time of the proclamation), in an elaborate manner; but that does not answer the basic
question, namely, when a sale held by a Court and culminating in a certificate issued by
the court is held to be a nullity for want of title, by reason of a defect discovered after
expiry of the period for making objections under rule 91 etc., is it justice to dispose of the
purchaser's grievance by saying that the purchaser purchased the property at his peril?
The decree-holder should re-imburse him for the loss suffered by him, because it is the
decree-holder at whose instance the sale was held. The abstract principle that there is no
warranty at court sales fails to yield a just result in this case.
The auction-purchaser should have a right to sue the decree-holder. Where a third party
challenges the judgment-debtor's title by filing a suit against the auction-purchaser, the
decree-holder and judgment-debtor should be necessary parties, and in that suit the court
shall direct the decree-holder to refund the money to the auction-purchaser.
If such a decree is passed, the original execution proceedings shall be revived at the stage
where the sale was ordered, unless the court otherwise directs. This provision is necessary
to avoid complications as to limitation."
Recommendation
"21.49. We, therefore, recommend that the following sub-rules should be added to Order
21, rule 92 - :-
"(5) Where a third party challenges the judgment-debtor's title by filing a suit against the
auction-purchaser, the decree-holder and the judgment-debtor shall be necessary parties
to the suit;
@page-SC570
(6) If the suit referred to in sub-rule (5) is decreed, the court shall, direct the decree-
holder to refund the money to the auction-purchaser, and, where such an order is passed,
the execution proceedings in which the sale had been held shall, unless the court
otherwise directs, be revived at the stage at which the sale was ordered."
20. The Statement of Objects and Reasons also lead to the same inference, wherein it
was, inter alia, stated - :
"Rule 92 is being amended to provide that where a third party challenges the judgment-
debtor's title by filing a suit against the auction-purchaser, the decree holder and the
judgment-debtor should be necessary parties to that suit and if the suit is decreed, the
Court shall direct the decree-holder to refund the money to the auction-purchaser. With a
view to avoiding complications with regard to limitation, the rule further provides that
where a decree is passed in favour of such third party, the original execution proceeding
will become revived at the stage where the sale was ordered unless the Court otherwise
directs."
21

. It is true the purpose of impleadment of a necessary party is to see as to whether without


it no order can be made effectively. If an effective order can be made, the suit will not be
defeated. A decree which is passed in terms of Order XXI, Rule 92(4) does not take into
consideration the effect of a statutory charge on a property, vis-a-vis the statutory right of
any persons having interest in the property to redeem or sell the same at any point of
time. When a fraud is practised on a court, the same is rendered a nullity. In a case of
nullity, even the principles of natural justice are not required to be complied with.
[Kendriya Vidyalaya Sangathan and Others v. Ajay Kumar Das and Others (2002) 4 SCC
503 and A. Umarani v. Registrar, Cooperative Societies and Others (2004) 7 SCC 112-
para 65]. 2002 AIR SCW 2658
2004 AIR SCW 4462
22

. Once it is held that by reason of commission of a fraud, a decree is rendered to be void


rendering all subsequent proceedings taken pursuant thereto also nullity, in our opinion, it
would be wholly inequitable to confer a benefit on a party, who is a beneficiary
thereunder. The decisions rendered in Udit Narain Singh Malpaharia v. Additional
Member, Board of Revenue, Bihar [(1963) Supp. 1 SCR 676] and Profulla Chrone
Requitte and Others v. Satya Chorone Requitte [(1979) 3 SCC 409] whereupon reliance
has been placed by Mr. Viswanathan, may not have any application in a case of this
nature in view of the fact that the principal question which, in our opinion, would be
more pertinent is as to whether even in a situation of this nature, the discretionary
jurisdiction under Article 136 of the Constitution of India should be invoked particularly
when the party raising the said question has been impleaded as a party. AIR 1963 SC
786
AIR 1979 SC 1682

23

. We would assume that the courts below proceeded on a wrong premise that Order XXI,
Rule 92(4) is not attracted, but the question as regards fraud committed by the judgment-
debtor has been gone into a great details. We are satisfied that the findings arrived at by
the learned Trial Judge and affirmed by the First Appellate Court also by the High Court
are equitable. It is in a situation of this nature, we are of the opinion that this Court in
exercise of its jurisdiction under Article 142 of the Constitution of India can pass an
appropriate order with a view to do complete justice to the parties. [Chandra Singh v.
State of Rajasthan and Another (2003) 6 SCC 545 Oriental Insurance Co. Ltd. v. Brij
Mohan and Ors. -2007 (7) SCALE 753 - para 14]. 2003 AIR SCW 3518
2007 AIR SCW 3734

Are the Appellants bound by the decree ?


24. In this case the appellants as also the aforementioned M/s Ramans purchased the
property pendente lite. They would be deemed to have notice of the sale made by
Venugopal in favour of the plaintiff-respondents. Section 3 of the Transfer of Property
Act provides that a person is said to have notice of the fact when he actually knows that
fact, where any transaction relating to immovable property is required by law to be and
has been effected by a registered instrument. [See Lachhman Dass v. Jagat Ram and
Others 2007 (3) SCALE 349]. They have purchased the property with notice, apart from
the fact that the transfer made in their favour was hit by Section 52 of the Transfer of
Property Act. The decree obtained by the Municipality had been passed under Order
XXXIV CPC. Respondents had a subsisting right of redemption. Order XXXIV, Rule 15
CPC provides that all the provisions contained therein shall, as far as may be, apply to a
mortgage by deposit of title-deeds within
@page-SC571
the meaning of Section 58, and to a charge within the meaning of Section 100 of the
Transfer of Property Act. The charge created under Section 85 of the 1920 Act would be
one covered by Section 100 of the Transfer of Property Act. Section 100 of the Transfer
of Property Act reads as under - :
"S. 100 Charges- Where immoveable property of one person is by act of parties or
operation of law made security for the payment of money to another, and the transaction
does not amount to a mortgage, the latter person is said to have a charge on the property;
and all the provisions hereinbefore contained which apply to a simple mortgage shall, so
far as may be, apply to such charge.
Nothing in this section applies to the charge of a trustee on the trust-property for expenses
properly incurred in the execution of his trust, and, save as otherwise expressly provided
by any law for the time being in force, no charge shall be enforced against any property
in the hands of a person to whom such property has been transferred for consideration
and without notice of the charge."
25

. In Mangru Mahto and Others v. Shri Thakur Taraknathji Tarake-shwar Math and Others
[1967 (3) SCR 125], this Court held - : AIR 1967 SC 1390

"A lease granted by the mortgagor, out of the ordinary course of management, though not
binding on the mortgagee, is binding as between the mortgagor and the lessee. Such a
lessee acquires an interest in the right of redemption and is entitled to redeem. If such a
lease is created before the institution of a suit relating to the mortgage, the lessee must be
joined as a party to the suit under Order 34 Rule 1 CPC; otherwise he will not be bound
by the decree passed in the suit and will continue to retain his right of redemption. But in
view of Section 52 of the Transfer of Property Act, if the mortgagor grants such a lease
during the pendency of a suit for sale by the mortgagee, the lessee is bound by the result
of the litigation. If the property is sold in execution of the decree passed in the suit, the
lessee cannot resist a claim for possession by the auction-purchaser. The lessee could
apply for being joined as a party to the suit and ask for an opportunity to redeem the
property. But if he allows the property to be sold in execution of the mortgage decree and
they have now lost the present case, the lessees allowed the suit lands to be sold in
execution of the mortgage decree and they have now lost the right of redemption. They
cannot resist the claim of the auction purchaser of recovery of possession of the lands."
26. Materials have been brought on record to show that a preliminary decree and a final
decree in terms of Order XXXIV have been passed. The learned Trial Judge also found
so. It is also appropriate to notice the following findings of the learned Trial Judge in
regard to issuance of the two encumbrances certificates - :
"...Ex. A.17 is the encumbrance certificate. Thiru E. Ayyasami filed an application and
obtained that encumbrance certificate. That encumbrance certificate has been issued on
28.6.1983 from the office of the Sub Registrar. In that the sale deed dated 12.11.70 in
favour of the plaintiff is shown. Similarly in that encumbrance certificate, the sale deed
dated 4.12.79 in respect of the suit property and another sale deed dated 22.8.81 in favour
of Manickam find a place. Ex. A. 18 is the questionnaire regarding family card. In that it
is mentioned that Manickam is the wife of Venugopal. But in the written statement filed
by the defendant it is stated that Manickam is not the wife of Venugopal. Ex. A. 16 is the
voters list issued to the family of Venugopal. In that document also it is stated that
Manickam is the wife of Venugopal. Ex. A. 20 is the copy of the complaint filed in the
criminal Court in STC No. 2119/94. That complaint has been filed by advocate Thiru N.
Sundaravadivelu and advocate Thiru S. Krishnamurthy. This document has been fled to
show that the defendants Venugopal and Manickam together engaged those two lawyers
and were conducting the case.
32. Ex. B. 4 is the encumbrance certificate obtained on the application by Thiru James.
That certificate has been issued on 24.7.80 by the Sub Registrar's Office. In that the sale
in favour of Sakunthala do not find a place. But in Ex. A. 17 the encumbrance certificate
obtained on 28.6.1983, the sale deed in favour of the plaintiff Sakunthala has been
mentioned. In an encumbrance certificate issued three years before Ex. B4 encumbrance
certificate was issued, the sale deed in favour of the plaintiff Sakunthala finds a place. In
an encumbrance certificate obtained thereafter that sale does not find a place. Hence it is
clear that because of the arrangements made by the defendant
@page-SC572
Venugopal, the sale in favour of the plaintiff Sakunthala does not find a place there.
Similarly Ex. B. 5 is the encumbrance certificate obtained by Thiru M.P. Ramakrishnan
on his application issued by the office of the Sub Registrar on 26.4.84 containing no
encumbrance. Hence it is clear that the matters contained in that encumbrance certificate
are false. Ex. B. 6 is the encumbrance certificate obtained by Mr. M.P. Ramakrishnan on
12.4.84. In that, the sale dated 22.8.1981 in favour of Manickam finds a place. Therefore
is clear that the encumbrance certificates marked on the side of the defendants contained
details contrary to truth. This court therefore hold that those encumbrance certificates
have been issued only in connivance with Venugopal. This Court hold that by selling the
property to 5th defendant to get more profit, the sale in favour of Sakunthala in the
encumbrance certificate was suppressed.
Conclusion :
27. Appellants and their predecessors, therefore, are also guilty of suppressio veri.
Ordinarily a statute shall prevail over the common law principle. However, in a case of
this nature, in the event of any conflicting interest, this Court in exercise of its equity
jurisdiction under Article 142 of the Constitution of India is to weigh the effect of a fraud
and the consequence of non-impleadment of a necessary party. We would hold that the
scale of justice weighs in favour of the person who is a victim of fraud and, thus, we
should not refuse any relief in his favour, only because he might have been wrongly
advised. The purport and object for which Order XXI, Rule 92(5) was enacted
furthermore would be better subserved if it is directed that the respondents shall pay the
amount which the Court paid to the Municipality out of the amount of auction.
28. We have noticed hereinbefore that one of the objects sought to be achieved in
amending Order XXI, Rule 92 was to do complete justice to the parties so as to enable
the auction purchaser to get back the amount from the decree-holder and revive the
execution proceedings so that the decree-holder may proceed against the judgment-debtor
for realisation of the decretal amount. In this case, the plaintiffs-respondents had not
claimed any relief against the Municipality. The Municipality's right to realise the amount
of property tax together with interest, if any, is not in dispute. Although the liability of
Venugopal in terms of the 1920 Act to pay the property tax continued, it has been
accepted at the Bar that the plaintiffs-respondents was also liable to pay the amount of
property tax after the date of sale. In a case of this nature, therefore, the plaintiffs-
respondents can be directed to pay the amount of property tax by way of redemption of
mortgage in favour of the Municipality.
29. If any amount is available with the court out of the amount received from the auction
sale, the same may be paid to the appellants. Appellants would also be otherwise entitled
to file an appropriate suit as against Manickam and others.
30. We, therefore, are of the opinion that subject to the terms aforementioned, the
appellants should not be granted any relief.
31. For the views we have taken, it is not necessary for us to go into the other contentions
raised by the learned counsel for the parties. We, therefore, direct the plaintiffs-
respondents to deposit the amount paid to the Municipality out of the auction amount by
the order of the executing court within six months from date and on such payment, the
appeal shall stand dismissed. However, in the facts and circumstances of the case, there
shall be no order as to costs.
Order accordingly.
AIR 2008 SUPREME COURT 572 "Rajendra Datta Zarekar v. State of Goa"
(From : Bombay)*
Coram : 2 G. P. MATHUR AND G. S. SINGHVI, JJ.
Criminal Appeal No. 32 of 2007, D/- 4 -12 -2007.
Rajendra Datta Zarekar v. State of Goa.
(A) Penal Code (45 of 1860), S.375 - RAPE - FALSE IMPLICATION - Rape - False
implication of accused - Normally improbable - Rape leaves a permanent scar and has a
serious psychological impact on victim and also her family members - No one would
normally concoct a story of rape just to falsely implicate a person. (Para 13)
(B) Penal Code (45 of 1860), S.375 - RAPE - Rape - Rupture of Hymen - Not essential to
constitute rape. (Para 14)
@page-SC573

(C) Penal Code (45 of 1860), S.376 - RAPE - PENOLOGY - Rape - Sentence - Victim a
child of 6 years - Accused a grown up person of 20 years - No adequate or special reasons
to impose less sentence made out - Sentence less than 10 years cannot be awarded in
view of S. 376(2)(f) - Fine of Rs. 10,000/- imposed on accused, however, reduced to Rs.
1,000/-. (Para 15)
Cases Referred : Chronological Paras
2006 AIR SCW 4550 : AIR 2006 SC 3098 : 2006 Cri LJ 4594 (Rel. on) 14
2004 AIR SCW 2486 : AIR 2004 SC 2636 : 2004 Cri LJ 2109 (Disting.) 15
1992 AIR SCW 1480 14
Vinay Navare and Naresh Kumar, for Appellant; Ms. A. Subhashini, for Respondent.
* Cri. Appeal No. 4 of 2005, D/- 16-8-2006 (Bom).
Judgement
G. P. MATHUR, J. :- This appeal has been preferred under S. 2(A) of the Supreme Court
(Enlargement of Criminal Appellate Jurisdiction) Act, 1970 against the judgment and
order dated 16-8-2006 of Goa Bench of Bombay High Court by which the appeal filed by
the State was allowed and judgment and order dated 28-7-2004 of First Ad hoc Assistant
Sessions Judge, Panaji in Sessions Case No. 1 of 2004 acquitting the accused was set
aside. The High Court convicted the appellant-Rajendra under Ss. 376(2)(f) and 342, IPC
and sentenced him to ten years R.I. and a fine of Rs. 10,000/- under the first count and
one month's R.I. and a fine of Rs. 1,000/- under the second count.
2. The case of the prosecution, in brief, is that P.W. 2 Satyam Ahire along with his wife
P.W. 1 Pushpa and three children was residing in Usgao in Ponda. He was working as a
security officer in Bethora Industrial Estate. In the evening of 14-10-2003 his eldest
daughter Supriya was studying at her home while the second daughter P.W. 8 Sonia, aged
about six years, was playing in the courtyard of his house. P.W. 4 Mohandas Goankar,
uncle of Pushpa, owned some rooms close by which were given on rent to some boys
who were working in the Nestle factory. The accused-Rajendra was living on rent in one
of these rooms. At about 5.00 p.m. on 14-10-2003 P.W. 1 Pushpa heard cries of her
daughter Sonia from inside the room, which was in occupation of the accused-Rajendra.
She went to the room and found it closed from inside and, therefore, she knocked at the
door. After some time the accused-Rajendra opened the door of the room. She enquired
from the accused as to what he was doing inside the room along with her daughter but he
kept quiet. On enquiry Sonia told her mother that the accused-Rajendra took her inside
his room while she was playing in the courtyard. He closed the door, switched off the
light and forced her to lie down on the mat. Thereafter the accused removed her panty
and also removed his own pant and lied down over her. He inserted his private part in the
private part of Sonia and did some movement. Pushpa then brought Sonia to her own
house and called her sister and other family members. After Satyam Ahire (father of
Sonia) had come back, they went to the Police Station, Ponda where they reached at
about 9.00 p.m. The PSI of Ponda Police Station sent them to Medical College where
Sonia was medically examined and the doctor confirmed that she had been subjected to
rape. Thereafter a formal FIR was registered at 11.45 p.m. on 14-10-2003 at P.S. Ponda.
3. After the case had been registered at the police station the same was investigated by
P.W. 11 Shivram Vaigankar, PSI. He recorded statements of witnesses under S. 161, Cr.
P.C. The accused-Rajendra was arrested at 5.00 a.m. on 15-10-2003 and the clothes
which he was wearing were taken into custody. He also took in custody the clothes of the
girl Sonia. He prepared a site plan and panchnama of the scene of occurrence in presence
of two witnesses and also seized a bed sheet and nylon mat. A photograph of the room
was also taken. After completing investigation he submitted charge-sheet under Ss. 342
and 376, I.P.C. against the accused-Rajendra.
4. The prosecution in support of its case examined 11 witnesses before the trial Court and
filed some documentary evidence. The learned Assistant Sessions Judge, after appraisal
of the evidence, came to the conclusion that the case of the prosecution was not
established beyond doubt against the accused-Rajendra and he accordingly acquitted him
by the judgment and order dated 28-7-2004. Feeling aggrieved by the judgment and order
of the learned Assistant Sessions Judge the State preferred an appeal before the High
Court. The High Court, after a detailed consideration of the evidence, allowed the appeal
and reversed the judgment of acquittal recorded by the Assistant Sessions Judge. The
High Court convicted
@page-SC574
the accused under S. 376(2)(f), I.P.C. and sentenced him to ten years R.I. and a fine of Rs.
10,000/- and in default to undergo six month's S.I. He was further convicted under S. 342,
I.P.C. and was sentenced to undergo one month's R.I. and a fine of Rs. 1,000/- and in
default to undergo 15 days' S.I.
5. We have heard Mr. Vinay Navare, learned counsel for the appellant-Rajendra and Ms.
A. Subhashini, learned counsel for the State of Goa, and have perused the record.
6. P.W. 4 Mohandas Gaonkar has deposed that he owns three houses and has four rooms
in one of his houses out of which one room had been given on rent to some boys who
were working in Nestle factory. The accused-Rajendra, who was employed in Nestle
factory, had been given one room on rent and his duty hours were from 8.00 a.m. to 4.30
p.m. On 14-10-2003 he returned from the market at about 6.30 p.m. when P.W. 1 Pushpa,
her sister and some others were present there in the house. Pushpa told him about the
incident regarding commission of rape by the accused-Rajendra on Sonia inside the
room.
7. P.W. 2 Satyam Ahire deposed that Mohandas Gaonkar is his wife's uncle and is a close
neighbour. He had given one room in his house to boys working in Nestle factory and the
accused-Rajendra was a tenant in one such room. On 14-10-2003 he had gone to the
market and returned from there after 5.00 p.m. When he returned home he found his
daughter Sonia weating and was in a very bad condition. She was lying in bed. His wife
P.W. 1 Pushpa informed him that the accused-Rajendra had pulled Sonia inside his room
and had committed rape upon her. He has further deposed that he then went to police
station by rikshaw and from there he was sent to medical college for medical examination
of Sonia.
8. P.W. 1 Pushpa has given a detailed version of the incident. She has deposed that she
has three children and Sonia, who is aged about six years, is her second daughter. Her
uncle Mohandas Gaonkar lives nearby and he had let out one of the rooms in his house to
the accused-Rajendra. In the evening of 14-10-2003 her elder daughter was studying at
home while Sonia was playing in the courtyard near the house. While she was preparing
some eatables she heard the cries of Sonia coming from the side of the house of her uncle
Mohandas Gaonkar. She immediately rushed there and found that the room which was
under the tenancy of the accused-Rajendra was closed from inside. She also heard the
cries of Sonia coming from inside the room. She then knocked at the door which was
opened by the accused after about five minutes. She enquired from the accused as to what
had happened but he kept quiet. Sonia, who had rushed to her mother, informed her that
she was taken inside the room by the accused and thereafter he closed the room from
inside and switched off the light. The accused forced her to lie down on the mat and after
removing her panty also removed his pant and lied down over her. He inserted his private
part inside her private part inside her private part and did some movement. Pushpa then
came to her own house and called her family members. After her husband had come back
from the market she went to the police station to lodge the report. The FIR was lodged by
her which is Exhibit 8. The police referred her daughter Sonia to Goa Medical College
for her medical examination. She went there where Sonia was medically examined. She
was cross-examined at length but nothing material has come out in the same which may
throw any doubt regarding the prosecution version of the incident. In cross-examination
she has said that her husband was not present and had gone to market and he returned
from the market at about 5.30 p.m. Sonia was crying loudly and was having great
difficulty in passing urine. She has further deposed that one day before her statement in
Court Sandesh, brother of the accused-Rajendra, and his mother had come to her house
pleading for mercy. She denied the defence suggestion that she had some kind of
relations with the accused and used to borrow money from him and had falsely
implicated him as she wanted some more money from him.
9. The prosecutrix Sonia was examined as P.W. 8. The learned Assistant Sessions Judge
put questions to her in order to ascertain whether she was in a position to give statement
in Court. After being satisfied about her mental capacity, her statement was recorded. The
learned Assistant Sessions Judge has noted that she wanted to be near her mother at the
time of recording her statement and that the accused had been sent little away with the
consent of his
@page-SC575
advocate so that the witness may be comfortable. Sonia stated that the accused-Rajendra
was residing in the room near her house. When she was near the house of her aunty the
accused came near her and pulled her inside his room and closed it from inside. He
removed her panty and his own pant and made her lie down on the mat. He lied over her,
inserted his private part in her private part and did some movement. She cried out of pain.
After few minutes her mother came and knocked at the door. After couple of minutes the
accused opened the door. She then narrated the entire incident to her mother. She
identified the panty and frock, which she was wearing at the time of the incident and
were seized by police, during the course of her statement in Court. She further said that
she was taken to the hospital for her medical examination.
10. P.W. 10 Dr. E.J. Rodrigues, Associated Professor in Forensic Medicine, Medical
College, Goa, examined Sonia at about 11.45 p.m. on 14-10-2003 in the presence of Dr.
Mrinalini, lecturer in the Medical College. He has deposed that the girl Sonia was of thin
built having a height of 97 cms. and weighing 26 kgs. The gait of Sonia was slightly
painful. Her genital development was of infant type nature. Pubic hairs were not erupted
and there were no injuries on inner aspects of thighs. There was a bruise reddish 2 x 1.5
cms. area on right labia majora and right labia minora, which was tender to touch. There
was a laceration of 5 mm. x 2 mm. on right labia minora near the clitoris which was
tender to touch. The hymen was intact. There were no fresh or old tears to hymen.
Hymnal opening admits tip of little finger. Hymnal border was bruised, edematous and
tender to touch. The vaginal contents and vaginal walls were normal. He opined as
under :-
"I certify that on physical genetical examination there is evidence of recent penetration.
Vaginal swabs and smear slides were retained for serological examination."
11. The same doctor also examined the accused-Rajendra at 12.15 p.m. on 15-10-2003 at
the request of police of Ponda Police Station in the presence of Dr. Girish Kamat. There
were no injuries on his body. His genital development was good. His pubic hairs were
black and not matted with blood or semen (preserved). On physical and genital
examination there was nothing to suggest that Rajendra was incapable of sexual
intercourse.
12. P.W. 3 Raju Sunktankar is the photographer who took photographs of the room and he
has proved the same. P.W. 5 Tarun Kumar is a panch witness of seizure of clothes of P.W.
8 Sonia and of accused-Rajendra. P.W. 6 Narayan is the panch witness of seizure of
matters and bed sheet. P.W. 9 Sanjay had examined the blood group of Sonia and of
accused-Rajendra. P.W. 11 Shivram Vaigankar, PSI of Ponda Police Station has deposed
about the lodging of FIR by Pushpa and registration of the case after he had received the
medical examination report of Sonia. He has deposed about the various steps taken by
him during the course of investigation of the case.
13. We have given above the gist of the evidence adduced by the prosecution. The
evidence shows that the accused-Rajendra was living as tenant in a room in the house of
P.W. 4 Mohandas Gaonkar, who is uncle of P.W. 1 Pushpa. The room in which the
accused was living is close to the house of the victim.In the evening of 14-10-2003 when
Sonia was playing outside the courtyard of her house the accused pulled her and took her
to his own room, bolted it from inside and after removing the clothes of Sonia and his
own pant committed rape upon her. The cries of Sonia attracted her mother Pushpa who
came there, knocked at the door and after some time the accused opened the same. Sonia
was crying loudly and she narrated the incident to her mother. Pushpa went to the police
station after her husband P.W. 2 Satyam Ahire and some other relations had come there.
The police sent Sonia to Medical College where she was medically examined by P.W. 10
Dr. Rodrigues who certified that she had been subjected to rape. Thereafter the FIR of the
incident was registered at the police station at 11.45 p.m. the same night. In spite of fairly
lengthy cross-examination nothing has come out in the statements of Pushpa and Sonia
which may throw even a slightest doubt on the prosecution version of the incident. There
is no enmity of any kind between Pushpa and the accused-Rajendra which may impel her
to falsely implicate the accused. Though a suggestion regarding taking of some money by
Pushpa from the accused has been made and a further suggestion has been made that she
wanted to have some kind of relationship with the accused but the same has not at all
been made probable
@page-SC576
much established by any evidence. The rape leaves a permanent scar and has a serious
psychological impact on the victim and also her family members and, therefore, no one
would normally concoct a story of rape just to falsely implicate a person. In the present
case there was not even an iota of evidence to show that P.W. 1 Pushpa or her husband
Satyam Ahire had any reason whatsoever to falsely implicate the accused-Rajendra. We
have carefully gone through the evidence and in our opinion the evidence lead by the
prosecution fully establishes the case against the accused-Rajendra beyond any shadow
of doubt.
14

. Learned counsel for the appellant has next submitted that the doctor had found that the
hymen of Sonia was intact and, therefore, the charge for rape under S. 376, I.P.C. as
defined in S. 375, I.P.C. has not been made out. An identical question was considered by
a Bench of this Court in Santosh Kumar v. State of M.P., 2006 (8) JT SC 171, and para 10
of the report is reproduced below :- 2006 AIR SCW 4550, Para 7

"10. The question, which arises for consideration, is whether the proved facts establish
the offence of rape. It is not necessary for us to refer to various authorities as the said
question has been examined in considerable detail in Madan Gopal Kakkad v. Naval
Dubey, 1992 (3) JT (SC) 270 and paras 37 to 39 of the said judgment are being
reproduced below : 1992 AIR SCW 1480
"37. We feel that it would be quite appropriate, in this context, to reproduce the opinion
expressed by Modi in Medical Jurisprudence and Toxicology (Twenty First Edition) at
page 369 which reads thus :
"Thus to constitute the offence of rape it is not necessary that there should be complete
penetration of penis with emission of semen and rupture of hymen. Partial penetration of
the penis within the labia majora or the vulva or pudenda with or without emission of
semen or even an attempt at penetration is quite sufficient for the purpose of the law. It is
therefore quite possible to commit legally the offence of rape without producing any
injury to the genitals or leaving any seminal stains. In such a case the medical officer
should mention the negative facts in his report, but should not give his opinion that no
rape had been committed. Rape is crime and not a medical condition. Rape is a legal term
and not a diagnosis to be made by the medical officer treating the victim. The only
statement that can be made by the medical officer is that there is evidence of recent
sexual activity. Whether the rape has occurred or not is a legal conclusion, not a medical
one."
38. In Parikh's Textbook of Medical Jurisprudence and Toxicology, the following passage
is found :
"Sexual intercourse.- In law, this term is held to mean the slightest degree of penetration
of the vulva by the penis with or without emission of semen. It is therefore quite possible
to commit legally the offence of rape without producing any injury to the genitals or
leaving any seminal stains."
39. In Encyclopedia of Crime and Justice (Vol. 4) at page 1356, it is stated :
". . . . . .even slight penetration is sufficient and emission is unnecessary."
Therefore, the absence of injuries on the private parts of a victim specially a married lady
cannot, ipso facto, lead to an inference that no rape has been committed."
Here the victim was a very young girl of six years of age and it is quite likely that full
penetration did not take place as the accused is a grown up person of over 20 years of
age. The injuries clearly indicate that rape, as defined in S. 375, I.P.C. did take place.
15

. Learned counsel for the appellant further submitted that the sentence of ten years R.I.
awarded by the High Court is very severe and the same may be reduced. It may be
mentioned here that S. 376(2)(f), I.P.C. specifically provides that where the victim is less
than 12 years of age the sentence awarded shall not be less than 10 years but it may be for
life and the accused shall also be liable to fine. The proviso, no doubt, says that the Court
may for adequate and special reasons to be mentioned in the judgment, impose a sentence
of imprisonment for a term of less than ten years. Here the victim P.W. 8 Sonia was aged
about six years and, therefore, the case is fully covered by Cl. (f) of sub-section (2) of S.
376, I.P.C. and the sentence awarded cannot be less than ten years unless there are
adequate and special reasons for doing so. We do not find any adequate or special reasons
for imposing a sentence of less than ten years. Learned counsel for the appellant placed
reliance on State of Chhattisgarh v. Derha (2004) 9 SCC 699, for reducing the sentence.
In the 2004 AIR SCW 2486

@page-SC577
authority cited what weighed with the Court was that the accused was hardly eighteen
years of age and had already served about six and half years' imprisonment. He was
married and had a family. In these circumstances the Court considered it proper to reduce
the sentence to seven years. Such is not the case here and, therefore, we are legally bound
to award a sentence of ten years. R.I. However, we feel that the fine of Rs. 10,000/-
awarded under S. 376(2)(f), I.P.C. is excessive and the same is reduced to Rs. 1,000/- and
the fine of Rs. 1,000/- awarded under S. 342, I.P.C. is set aside.
16. In the result the appeal is dismissed with the modification that the fine of Rs. 10,000/-
imposed under S. 376(2)(f), I.P.C. is reduced to Rs. 1,000/- and the fine of Rs. 1,000/-
imposed under S. 342, I.P.C. is set aside. The substantive sentence of ten years R.I.
awarded under S. 376(2)(f), I.P.C. and one month R.I. under S. 342, I.P.C. are maintained.
Appeal dismissed.
AIR 2008 SUPREME COURT 577 "Dayanand V. V. S. Samiti v. Education Inspector,
Greater Bombay"
(From : Bombay)
Coram : 2 A. K. MATHUR AND MARKANDEY KATJU, JJ.
Civil Appeal No. 5979 of 2001, D/- 25 -10 -2007.
Dayanand Vedic Vidhalaya Sanchalak Samiti v. Education Inspector, Greater Bombay
and Anr.
Constitution of India, Art.226 - Bombay Primary Education Act (61 of 1947), S.63 -
Bombay Primary Education Rules (1949), R.2 - WRITS - EDUCATION - HIGH COURT
- Interim order - Powers of High Court - Order of Education Inspector - Rejecting
approval for appointments of teachers allegedly made in violation of Rules - Writ petition
against - Interim order by High Court directing grant of ad hoc approval to some teachers
- Illegal, as there is no provision in Rules for grant of ad hoc approval - Practice of
granting such interim orders which really amounts to grant of final relief - Deprecated.
(Paras 3, 4)

A. T. M. Rangaramanujam, Sr. Advocate, M. A. Chinnasamy, Vimal Wadhawani, K.


Krishna Kumar and Ms. Ruby Singh Ahuja, for Appellant; Chirag M. Shroff, Mukesh
Kumar, Ms. Mahima C. Shroff, S.S. Shinde and Ms. Asha Gopalan Nair, for
Respondents.
Judgement
JUDGMENT :-We have heard learned counsel for the parties.
2. This appeal by special leave is directed against the impugned interlocutory order dated
23rd November, 2000 in Writ Petition No. 2209 of 2000 passed by the High Court of
Bombay. The prayer in that writ petition was for quashing the order of the Education
Inspector, Greater Mumbai dated 30-9-2000. The order dated 30-9-2000 states that since
certain appointments of teachers were made by the Dayanand Vedic Vidyalaya, Mumbai
in violation of the Rules, approval for such appointments is rejected.
3. In order opinion in such a petition there was no scope for grant of any interim order,
and instead the writ petition should have been decided finally at an early date. However,
what the High Court has done by the impugned interim order is to direct grant of ad hoc
approval to some teachers.
4. This is a strange order passed by the High Court. There is no provision in the rules for
grant of ad hoc approval. Either approval is granted, or the prayer is rejected. There is no
scope for a half way measure like that adopted by the High Court. We cannot appreciate
such kind of interim orders which really amount to grant of final relief. This kind of
practice of granting such interim orders should be discontinued and should not be
encouraged.
5. However, in this appeal against the order of the High Court, this Court on 29th January,
2001 observed that "the operation of the order under challenge shall remain stayed unless
the order under challenge has already given effect to." The writ petition is still pending
before the High Court of Bombay. We request the High Court to dispose off the matter
finally, if not disposed off so far, preferably within a period of three months from the date
on which a copy of this order is received by it.
6. The interim order dated 29th January, 2001 passed by this Court is made absolute, but
shall only continue till the final disposal of the writ petition by the High Court.
7. The Civil Appeal is accordingly, disposed of.
Order accordingly.
@page-SC578
AIR 2008 SUPREME COURT 578 "R. Radhakrishnan v. Director General of Police"
(From : Madras)
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Civil Appeal Nos. 4874 with 4875 of 2007 (arising out of SLP (C) Nos. 17394 with
17395 of 2006), D/- 12 -10 -2007.
R. Radhakrishnan v. Director General of Police and Ors.
Constitution of India, Art.16 - EQUALITY IN PUBLIC EMPLOYMENT -
APPOINTMENT - OBSCENITY - Appointment - Suppression of material fact - Post of
Fireman - Applicant in his application not disclosing material fact as to his involvement
in criminal case that too a cognizable offence under S. 294(b) of IPC - Non-selection of
applicant - No interference.
(1996) 11 SCC 605, Foll.
1988 Supp SCC 795, Disting. (Para 13)
Cases Referred : Chronological Paras
(1996) 11 SCC 605 (Foll.) 11
1988 Supp SCC 795 (Disting) 12
V. Prabhakar, V. Subramani, Mrs. Ravathy Raghavan and Ramjee Prasad, for Appellant;
R. - Venkatramani, Sr. Advocate, V. G. Pragasam, S. Joseph Aristotle and S. Prabhu
Ramasubramanian, for Respondents.
Judgement
S. B. SINHA, J. - :-Leave granted.
2. Appellant, aggrieved by and dissatisfied with judgments and orders dated 21.01.2004
and 27.04.2006 passed by the High Court of Judicature at Madras in Writ Petition No.
13357 of 2002 and R.A. No. 68 of 2005 respectively, is before us.
3. Pursuant to or in furtherance of an advertisement dated 29.12.1999 having been issued
in that behalf, the appellant filed an application for appointment to the post of Fireman on
05.01.2000. He was provisionally selected whereafter he submitted a verification roll, the
relevant part whereof reads as under - :
"I realize that if I am enlisted and my statement which has been made by me is found to
be false, I shall render myself liable to be dismissed for obtaining service under false
pretences.
*** *** ***

15. Have you ever been concerned in any criminal case as accused? No
16. Have you ever been arrested or convicted and sentenced to undergo imprisonment
or pay a fine in any criminal or other offence - ? If so, give details with C.C. No. and
Court. No
*** *** ***
18. Are there any civil or criminal cases pending against you - ? If so, details. No

4. It now stands admitted that he, however, was involved in an incident which occurred
on 15.04.2000, and was proceeded against under Section 294(b) of the Indian Penal
Code.He was arrested but was released on bail.He, however, was acquitted of the said
charge on 25.09.2000.Inter alia on the premise that he had made false statement in his
verification roll, in regard to the pendency of the aforementioned case, he was not
selected.
5. He filed an original application before the Tamil Nadu Administrative Tribunal.The
learned Tribunal by reason of a judgment and order dated 4.03.2002 opined that as he had
been acquitted in the criminal case, there did not exist any reason as to why he should be
denied an appointment to the post of Fireman.A writ petition preferred thereagainst by the
respondent herein was allowed by reason of the impugned judgment.
6. Mr. V. Prabhakar, learned counsel appearing on behalf of the appellant, in support of
this appeal, raised a short question, viz., having regard to the fact that the appellant
signed the application prior to the date when the alleged accident took place and also
stood acquitted when he filled up the verification roll, he cannot be said to have wilfully
suppressed any material fact warranting denial from appointment in service.
7. The learned counsel would contend that in a case of this nature, the High Court ought
to have taken a sympathetic view and should not have allowed the writ petition of the
respondent only on the ground that he had suppressed the factum of his involvement in a
criminal case.
8. Mr. R. Venkatramani, learned senior counsel appearing on behalf of the respondent, on
the other hand, would submit that bona fide or otherwise on the part of the appellant
cannot be a criteria for determining the issue.The learned counsel
@page-SC579
submitted that had the relevant fact, viz., involvement in a criminal case and that too a
cognizable offence under Section 294(b) of the Indian Penal Code, been disclosed, the
appointing authority could have verified his character and suitability for appointment.It
was pointed out that the persons similarly situated against whom criminal cases had been
instituted had not been selected.
9. The learned counsel furthermore submitted that in view of the fact that the appellant
knew that he would be liable to be dismissed in service if the statement made in the
verification roll was found to be false cannot now be heard to say that he omitted to
mention the pendency of the criminal case under a bona fide belief or otherwise.
10. Indisputably, Appellant intended to obtain appointment in a uniformed service.The
standard expected of a person intended to serve in such a service is different from the one
of a person who intended to serve other services.Application for appointment and the
verification roll were both in Hindi as also in English. He, therefore, knew and
understood the implication of his statement or omission to disclose a vital
information.The fact that in the event such a disclosure had been made, the authority
could have verified his character as also suitability of the appointment is not in dispute.It
is also not in dispute that the persons who had not made such disclosures and were, thus,
similarly situated had not been appointed.
11. The question came up for consideration before this Court in Delhi Administration
through its Chief Secretary and Others v. Sushil Kumar [(1996) 11 SCC 605] wherein it
was categorically held :
"3...The Tribunal in the impugned order allowed the application on the ground that since
the respondent had been discharged and/or acquitted of the offence punishable under
Section 304 IPC, under Section 324 read with Section 34 IPC and under Section 324 IPC,
he cannot be denied the right of appointment to the post under the State. The question is
whether the view taken by the Tribunal is correct in law? It is seen that verification of the
character and antecedents is one of the important criteria to test whether the selected
candidate is suitable to a post under the State. Though he was found physically fit, passed
the written test and interview and was provisionally selected, on account of his
antecedent record, the appointing authority found it not desirable to appoint a person of
such record as a Constable to the disciplined force. The view taken by the appointing
authority in the background of the case cannot be said to be unwarranted...."
12. Mr. Prabhakar has relied upon a decision of this Court in T. S. Vasudavan Nair v.
Director of Vikram Sarabhai Space Centre and Others [1988 Supp SCC 795].The said
decision has been rendered, as would be evident from the judgment itself, on special facts
and circumstances of the said case and cannot be treated to be a binding precedent.
13. In the instant case, indisputably, the appellant had suppressed a material fact. In a
case of this nature, we are of the opinion that question of exercising an equitable
jurisdiction in his favour would not arise.
14. For the reasons aforementioned, there is no merit in these appeals which are
dismissed accordingly. However, in the facts and circumstances of this case, there shall
be no order as to costs.
Appeals dismissed.
AIR 2008 SUPREME COURT 579 "K. R. Mohan Reddy v. M/s. Net Work Inc. Rep. Tr.
M. D."
(From : AIR 2007 (NOC) 148 : 2007 (2) AIR Jhar R (NOC) 470 (AP))
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Civil Appeal No. 4588 of 2007 (arising out of SLP (C) No. 3540 of 2007), D/- 26 -9
-2007.
K. R. Mohan Reddy v. M/s. Net Work Inc. Rep. Tr. M. D.
Civil P.C. (5 of 1908), O.41, R.27(1)(aa), R.27(1)(b) - APPEAL - EVIDENCE -
Additional evidence - Adduction at appellate stage - Application made under O. 41, R.
27(1), Cl. - (aa) - Cannot be proceeded with as if it is one under Cl. (b) of O. 41, R. 27(1)
- Conditions precedent for application of Cl. (aa) and Cl. (b) are different.
Clauses (a), (aa) and (b) of sub-rule (1) of Rule 27 of Order 41 refer to three different
situations. Power of the appellate Court to pass any order thereunder is limited. For
exercising its jurisdiction thereunder, the appellate Court must arrive at a finding that one
or the other conditions enumerated thereunder is satisfied. A good reason must also be
shown as to why the evidence was not produced in the trial Court. The conditions
precedent for application of Clause (aa)
@page-SC580
of sub-rule (1) of Rule 27 of Order XLI is different from that of Clause (b). In the event
the former is to be applied, it would be for the applicant to show that the ingredients or
conditions precedent mentioned therein are satisfied. On the other hand Clause (b) to sub-
rule (1) of Rule 27 of Order XLI of CPC is to be taken recourse to, the appellate Court
was bound to consider the entire evidence on record and come to an independent finding
for arriving at a just decision; adduction of additional evidence as has been prayed by the
appellant was necessary.
(Paras 15, 18)
Cases Referred : Chronological Paras
2006 AIR SCW 2169 : AIR 2006 SC 1864 20
AIR 1965 SC 1008 20
Rakesh Dewedi, Sr. Advocate, Annam D. N. Rao and Ms. Fita Gupta, for Appellant; Udai
U. Lalit, Sr. Advocate, P. S. Narsimha, Somiran Sharma, L. Rashmani, Mrs. Mandakini
and Aribam Guneshwar Sharma, for Respondent.
Judgement
S. B. SINHA, J. - :-Leave granted.
1

. This appeal is directed against the judgment and order dated 20/9/2006 passed by a
Division Bench of the Andhra Pradesh High Court in C.C.C.A.No.253/2004 and the
application for adduction of additional evidence marked as City Civil Court Appeal Misc.
Petition No. 239 of 2006, whereby and whereunder the application filed by the
respondent herein, purported to be under Order 41 Rule 27 of the Code of Civil
Procedure was allowed. reported in AIR 2007 (NOC) 148 : 2007 (2) AIR Jhar R
(NOC) 470 (AP)

2. The parties entered into a partnership. The said partnership was reconstituted on
1.7.1994. Plaintiff -respondent contended that pursuant to the reconstituted partnership
deed, the appellant had handed over certain works to the respondent-firm for its
execution. It is also not in dispute that the appellant herein retired as a partner from the
said Firm. However, it has been contended that despite his retirement, the appellant had
requested the respondent to continue the work allotted in his name so as to protect his
turnover and continuation of his registration as a special class contractor. Further, the case
of the respondent was that the appellant was to hand over the payment which he is
supposed to receive in lieu of the Khammam Project. According to it upon settlement of
accounts of Khammam Project, an amount of Rs. 34,82,000/- was found due and payable
by the appellant to the respondent Firm.
3. The contention of the respondent, on the other hand, is that in respect of construction
of Minister's quarter at Hyderabad, the appellant had paid. Rs. 8,00,000/- and Rs.
5,25,316/-. It claimed that a sum of Rs. 8,03,350/- was owing to it by the appellant in
respect of the Vijayawada work.
4. According to the respondent, the appellant issued a cheque of Rs. 34,82,000/- in favour
of the Firm in respect of Khammam Project along with a covering letter wherein the
appellant assured the respondent that he would settle the accounts pertaining to the other
two projects after finalizing the accounts with the department. The said cheque was
dishonoured.
5. On the aforementioned premise, on or about 21.1.2002 a suit for recovery of Rs.
50,74,109/- along with the interest @ 24% per annum was filed by the respondent herein.
6. Appellant in his written statement, while denying and disputing the aforementioned
contentions of the plaintiff-respondent, inter alia, asserted that the cheque had been
obtained by it by fraud,forgery and with the connivance of one Shri K. Ramesh Reddy
and Mr. Y.S.Subramaniam, Managing Partner of the Respondent. It was also asserted by
the appellant that he had retired from the partnership on 12.1.2000 and all the accounts
between the parties were comprehensively settled which was also recorded in the deed of
retirement.
7. The trial Court framed a general issue as to whether the plaintiffs are entitled to any
relief and did not frame a specific issue with regard to the case of the appellant herein
that the said cheque was an outcome of fraud and forgery. The learned trial Judge,
however, dismissed the suit holding as under - :
"i) Defendant admits assignment of Khammam and Vijayawada Projects to the petitioner.
ii) Clause 8 of the retirement deed does not mention about pending work with the
respondent and future dues payable .
iii) Plaintiff did not file its accounts to prove that the plaintiff has executed the entire
work at Khammam Hospital.
@page-SC581
iv) Pending disposal of the suit filed by the defendant against the plaintiff for recovery of
the amounts paid to the plaintiff after retirement (7.6.2000 and 13.7.2000) on the ground
that the same was by way of loan, it is difficult to take a view that the defendant has paid
any money after his retirement towards the dues payable under the aforesaid transaction.
v) There is a possibility that the cheque was dishonestly obtained."
8. Respondent preferred an appeal thereagainst. Indisputably, an application under Order
XLI Rule 27 of Code of Civil Procedure was filed on 22.3.2006.
9. It, however, appears that no notice was issued in relation thereto. The said application
purported to have come up for consideration along with the hearing of the appeal.
10. With the consent of the parties, the main appeal itself was to be heard.
11. By reason of the impugned judgment, although, the High Court noticed the findings
of the learned trial Judge and various decisions operating in the field, inter alia, held that
the application for adduction of additional evidence filed by the respondent herein should
be allowed, the same being a requirement of Court and/or was otherwise for substantial
cause.
12. Mr.Rakesh Dwivedi, learned senior counsel appearing on behalf of the appellant, inter
alia, would submit that the High Court prior to passing of the said order did not give an
opportunity to the appellant to file an objection in regard to the maintainability of the said
application.
13. In any event, the learned counsel would contend that the respondent's application
being based on clause (aa) of sub-rule (1) of Rule 27 of order XLI of C.P.C., the High
Court committed a serious error in relying upon Clause (b) thereof.
14. Mr.Uday Umesh Lalit, learned senior counsel appearing on behalf of the respondent,
on the other hand, would submit that if the case of the respondent as set out in his plaint
vis-a-vis the findings of learned trial Judge are to be considered in their entirety, the High
Court was correct in its view.
15. The High Court, in our opinion, failed to apply the provisions of Order 41 Rule 27 of
CPC in its correct perspective. Clauses (a), (aa) and (b) of sub-rule (1) of Rule 27 of
Order XLI refer to three different situations. Power of the appellate court to pass any
order thereunder is limited. For exercising its jurisdiction thereunder, the appellate Court
must arrive at a finding that one or the other conditions enumerated thereunder is
satisfied. A good reason must also be shown as to why the evidence was not produced in
the trial Court.
16. Respondent in its application categorically stated that the books of accounts had been
misplaced and the same were discovered a few days prior to the filing of the said
application while the office was being shifted.
17. The High Court, unfortunately did not enter into the said questions at all . As
indicated hereinbefore, the High Court proceeded on the basis as if clause(b) of sub-rule
(1) of Rule 27 of Order XLI of CPC was applicable.
18. It is now a trite law that the conditions precedent for application of clause (aa) of sub-
rule (1) of Rule 27 of Order XLI is different from that of clause(b). In the event the
former is to be applied, it would be for the applicant to show that the ingredients or
conditions precedent mentioned therein are satisfied. On the other hand clause(b) to sub-
rule (1) of Rule 27 of Order XLI of CPC is to be taken recourse to, the appellate Court
was bound to consider the entire evidences on record and come to an independent finding
for arriving at a just decision; adduction of additional evidence as has been prayed by the
appellant was necessary.
19. The fact that the High Court failed to do so, in our opinion, amounts to misdirection
in law. Furthermore, if the High Court is correct in its view that the plaintiff-respondent
had proceeded on the basis that the suit in its entirely based on a cheque, wherefor, it was
not necessary for it to file the books of accounts before the trial Court, finding contrary
thereto could not have been arrived at that the same was in fact required to be proved so
as to enable the appellate Court to arrive at a just conclusion.
20

. The Supreme Court in State of Gujarat v. Mahendrakumar Parshottambhai Desai(dead)


by L.Rs-. (2006) 9 SCC 772 relying upon Municipal Corporation of Greater Bombay v.
Lal Pancham and Ors., 2006 AIR SCW 2169, (Para 10)
AIR 1965 SC 1008

@page-SC582
held as under - :
"Though the appellate Court has the power to allow a document to be produced and a
witness to be examined under Order XLI Rule 27 CPC, the requirement of the said Court
must be limited to those cases where it found it necessary to obtain such evidence for
enabling it to pronounce judgment. This provision did not entitle the appellate court to let
in fresh evidence at the appellate stage where even without such evidence it can
pronounce judgment in the case. It does not entitle the appellate court to let in fresh
evidence only for purposes of pronouncement of judgment in a particular way."
21. Appellate Court should not pass an order so as to patch up the weakness of the
evidence of the unsuccessful party before the trial Court, but it will be different if the
Court itself require the evidence to do justice between the parties. The ability to
pronounce judgment is to be understood as the ability to pronounce judgment
satisfactorily to the mind of the Court. But mere difficulty is not sufficient to issue such
direction. While saying so, however, we do not mean that the Court at an appropriate
stage would be precluded from considering the applicability of clause (b).
22. We are, therefore, of the opinion that the impugned judgment cannot be sustained. It
is set aside accordingly. The respondent may file additional affidavit in support of its
application under Order XLI Rule 27 CPC within two weeks from the date of receipt of
copy of this order. The appellant may file his response both to the Original Application as
also the additional affidavit, if any, within four weeks thereafter.
23. We would request the High Court to consider the entire matter in accordance with law
afresh on merits.
24. The appeal is disposed of with the aforementioned observations.
Order accordingly.
AIR 2008 SUPREME COURT 582 "State of M.P. v. Babulal"
(From : Madhya Pradesh)*
Coram : 2 C. K. THAKKER AND ALTAMAS KABIR, JJ.
Criminal Appeal No. 1658 of 2007 (arising out of S.L.P. (Cri.) No. 5974 of 2005), D/- 3
-12 -2007.
State of M.P. v. Babulal.
(A) Penal Code (45 of 1860), S.376 - RAPE - COMPLAINT - EVIDENCE - FALSE
IMPLICATION - Rape - Complaint filed by husband of victim - No unexplained delay -
Evidence of victim was "straightforward" and believable - Plea of false implication -
Ground of failure to return advance money taken from accused by husband of victim -
Found not tenable - Conviction of accused - Not illegal. (Paras 13, 17)
(B) Penal Code (45 of 1860), S.376 - RAPE - SENTENCE IMPOSITION - Rape -
Sentence - Imposition of - Undeserved indulgence or liberal attitude in not awarding
adequate sentence - Not proper.
The Courts are, expected to try and decide cases of sexual crime against women with
utmost sensitivity. Such cases need to be dealt with sternly and severely. A socially
sensitized Judge is a better armour in cases of crime against women than long clauses of
penal provisions, containing complex exceptions and complicated provisos. Once a
person is convicted for an offence of rape, he should be treated with a heavy hand. An
undeserved indulgence or liberal attitude in not awarding adequate sentence in such cases
would amount to allowing or even to encouraging 'potential criminals.' The society can
no longer endure under such serious threats. Courts must hear the loud cry for justice by
society in cases of heinous crime of rape and impose adequate sentence. Public
abhorrence of the crime needs reflection through imposition of appropriate sentence by
the Court.
2006 AIR SCW 1123, Relied on.
(Paras 25, 26)
(C) Penal Code (45 of 1860), S.376 - RAPE - SENTENCE IMPOSITION - Rape -
Imposition of sentence less than minimum - Recording of "adequate" and "special"
reasons is sine qua non - Reasons that accused was "illiterate agriculturist" from rural
area" and "amount of fine of Rs. 2500/- was imposed on him" - Can neither be said to be
'special' nor 'adequate' - Thus, order reducing sentence imposed on accused to "period
already undergone" which was only two months and three days and much less than
minimum required to be imposed - Liable to be set aside.
Criminal Appeal No. 298 of 2003, D/- 21-3-2003 (MP), Reversed. (Paras 30, 31, 32)
@page-SC583
Cases Referred : Chronological Paras
2006 AIR SCW 1123 : AIR 2006 SC 1267 : 2006 Cri LJ 1679 (Rel. on) 26
1992 AIR SCW 1480 (Ref.) 2
1992 AIR SCW 2365 : AIR 1992 SC 2004 : 1992 Cri LJ 3655 (Ref.) 14
1983 SC 753 : 1983 Cri LJ 1096 (Ref.) 14
AIR 1973 SC 1457 : 1974 Cri LJ 243 (Ref.) 22
D. K. Singh, C. D. Singh, Merusagar Samantary and Vairagya Vardhan, for Appellant;
Anish Kumar Gupta, Umesh Babu Chaurasia, Ms. Deepshikha Bharati and Mrs. Rita
Gupta, for Respondent.
* Cri. A. No. 298 of 2003, D/- 21-8-2003 (MP).
Judgement
1. C. K. THAKKER, J. :-Leave granted.
2

. The present appeal reminds us observations of Hon'ble Mr. Justice S. Ratnavel Pandian
in Madan Gopal Kakkad v. Naval Dubey and Anr., (1992) 3 SCC 204 that "offenders of
sexual assault who are menace to the civilized society should be mercilessly and
inexorably punished in the severest terms". Dealing with a case of sexual assault, His
Lordship emphasized on Courts of Law their duty to handle offenders of such crimes
with a heavy hand. His Lordship concluded: 1992 AIR SCW 1480

"We feel that Judges who bear the Sword of Justice should not hesitate to use that sword
with the utmost severity, to the full and to the end if the gravity of the offences so
demand".
3. The case on hand, in our considered view, exhibits not only casual, indifferent and
perfunctory approach but insensitive attitude adopted by the High Court in awarding
sentence on an offender who perpetrated a heinous crime of committing rape on a
married woman in broad daylight. The case of the prosecution was that respondent
Babulal was residing at village Daulatpur, Tehsil Ikchavaar, District Sehore in Madhya
Pradesh. On July 23, 2002, at about 12.00 noon in his own tapri, he criminally
intimidated the prosecutrix-PW5, aged about 22 years, a married lady (hereinafter
referred to as 'PW5-X') and committed rape on her. According to the prosecution, PW5-X
was living with her husband in the house of the accused. On the day of the incident, she
was washing a drum on tapri when the accused caught her from behind and threw her on
the ground. The prosecutrix-PW5 shouted and resisted, but the accused threatened her
with knife and committed rape on her. Even thereafter, he threatened to kill her if she
reported the incident to anyone else. In the evening, PW5-X told about sexual assault to
her husband and her mother-in-law Dallubai, a blind lady. PW8-Ramcharan, who was the
employer of PW7-Shiv Narayan-husband of PW5 was also informed who assured that he
would talk to the accused and PW5 should not leave the place due to fear. On the next
day, i.e. July 24, 2002, when the elder brother of Shiv Narayan arrived, the prosecutrix
(PW5-X) and her husband (PW7) went to the police station, Ikchavaar and lodged a
complaint. PW5-X was then sent for medical examination, site plan was prepared and
statements of witnesses were recorded. PW5 was medically examined. The accused was
also sent for medical examination. It was found that he was absolutely competent to
commit sexual intercourse. After completion of usual investigation, charge-sheet was
submitted for offences punishable under Section 376 read with Section 506, Part II,
Indian Penal Code (IPC). The accused denied the charge. In his statement under Section
313 of the Code of Criminal Procedure, 1973, he contended that in order to avoid
repayment of loan taken from Ramcharan-PW8, the prosecutrix (PW5-X) had falsely
implicated him in the case.
4. The trial Court considered the evidence adduced by the prosecution and particularly
sworn testimony of PW5-prosecutrix, PW7-Shiv Narayan-husband of prosecutrix and
PW9-Dr. Madhu Sharma, immediate Assistant Surgeon, Public Health Centre, Ikchavaar
and held that it was proved beyond reasonable doubt that the accused had committed the
offence of rape. So far as PW8-Ramcharan is concerned, he did not support the
prosecution and was declared 'hostile'. The trial Court, however, acquitted the accused of
the charge under Section 506, II IPC.
5. On sentence, the trial Court heard the accused who prayed for grant of probation
which, in our opinion, was rightly refused by the Court. In the light of mandate in sub-
section (1) of Section 376, IPC, the trial Court imposed minimum sentence of seven
years' rigorous imprisonment and to pay fine of Rs.2,500/- (two thousand five hundred).
In default of payment of fine, the accused was ordered to undergo rigorous imprisonment
for six months more. The amount of fine was ordered to be paid to the prosecutrix X.
6. The aggrieved accused preferred an appeal before the High Court of Madhya
@page-SC584
Pradesh. The learned counsel for the accused did not challenge the finding of conviction
but prayed for mercy and leniency in sentence. The learned Judge of the High Court
upheld the argument of the learned counsel for the appellant and observed that the
accused was initially in custody from September 11, 2002 to October 10, 2002 and again
after the pronouncement of the judgment, he was sent to jail on January 23, 2003 till he
was enlarged on bail on February 26, 2003. The learned Judge also observed that the
accused was an 'illiterate agriculturist from rural area' and fine of Rs.2,500/- was also
imposed on him. According to the learned Judge, on the facts of the case, the
imprisonment for two months and three days which had already undergone by the
accused could be said to be 'just and proper' and accordingly the appeal was partly
allowed.
7. Aggrieved by the said order passed by the High Court, the State has approached this
Court.
8. On November 21, 2005, notice as also bailable warrant was issued against the
respondent which was duly served upon him. The respondent also appeared through an
advocate. On March 19, 2007 when the matter was called out, the advocate appearing for
the respondent-accused stated that he had no papers. The Court, therefore, ordered that
papers be given to the learned counsel appearing for the respondent by the counsel for the
State. The matter was then called out for final hearing.
9. We have heard learned counsel appearing for the parties.
10. The learned counsel for the State contended that the High Court had committed a
serious error of law in reducing the sentence imposed by the trial Court. He submitted
that sub-section (1) of Section 376, IPC provides minimum sentence of rigorous
imprisonment for seven years which was imposed by the trial Court and there was no
reason for the High Court to interfere with the said order. Maximum imprisonment
imposable on the offender under the said provision is ten years. The High Court was,
therefore, not right in reducing the sentence and that too when the accused had undergone
only for two months and three days. It was also submitted that no 'adequate and special
reasons' were recorded by the High Court for reducing the sentence and even on that
ground also the order is vulnerable. The counsel submitted that the High Court ought to
have appreciated the fact that the offence was committed in broad daylight. He, therefore,
submitted that the order passed by the High Court deserves to be set aside by restoring
the order of the trial Court.
11. The learned counsel for the respondent-accused submitted that the discretion
exercised by the High Court considering the position of the accused, cannot be said to be
illegal and deserves no interference.
12. Having heard the learned counsel for the parties, in our opinion, the High Court had
manifestly erred in allowing the appeal and in reducing the sentence imposed on the
offender to the period 'already undergone'.
13. So far as conviction of the respondent is concerned, we find no infirmity in the
reasons recorded and the conclusion arrived at by the trial Court. The trial Court rightly
held that on the fateful day, at 12.00 noon, the accused committed the crime. In her
testimony on oath, prosecutrix narrated the incident and stated that when she was
washing the kothi on tapri, the accused came from the behind, caught her, pulled her
down on the earth and committed rape on her. The trial Court rightly observed that the
prosecutrix informed her husband about the incident, who in turn contacted PW8-
Ramcharan-employer, but Ramcharan-PW8 did nothing. The matter was also reported by
prosecutrix to her mother-in-law Dallubai who was blind. PW7-Shiv Narayan-husband of
the prosecutrix intimated his elder brother about the incident when he came next day and
thereafter First Information Report (FIR) was lodged. The trial Court rightly held that
there was no unexplained delay in filing the complaint. The 'straightforward' evidence of
prosecutrix-PW5 was believed by the Court and accordingly the accused was convicted.
We are fully satisfied that in recording a finding of guilt against the respondent, the trial
Court had not committed any error, either of fact or of law.
14

. As held by this Court in several cases, if a Court of law finds evidence of prosecutrix
truthful, trustworthy and reliable, conviction can be recorded solely on the basis of her
testimony and no further corro-boration is necessary. In this connection, we may refer to
only two leading decisions of this Court in Bharwada Bhoginbhai Hirjibhai v. State of
Gujarat, (1983) 3 SCC 217 and AIR 1983 SC 753
1992 AIR SCW 2365

@page-SC585
State of Rajasthan v. Narayan, (1992) 3 SCC 615.
15. In the first case, this Court, speaking through M.P. Thakkar, J. stated:
"9. In the Indian setting, refusal to act on the testimony of a victim of sexual assault in the
absence of corroboration as a rule, is adding insult to injury. Why should the evidence of
the girl or the woman who complains of rape or sexual molestation be viewed with the
aid of spectacles fitted with lenses tinged with doubt, disbelief or suspicion? To do so is
to justify the charge of male chauvinism in a male dominated society. We must analyze
the argument in support of the need for corroboration and subject it to relentless and
remorseless cross-examination. And we must do so with a logical, and not an
opinionated, eye in the light of probabilities with our feet firmly planted on the soil of
India and with our eyes focused on the Indian horizon. We must not be swept off the feet
by the approach made in the western world which has its own social milieu, its own
social mores, its own permissive values, and its own code of life. Corroboration may be
considered essential to establish a sexual offence in the backdrop of the social ecology of
the western world. It is wholly unnecessary to import the said concept on a turnkey basis
and to transplant it on the Indian soil regardless of the altogether different atmosphere,
attitudes, mores, responses of the Indian society, and its profile. The identities of the two
worlds are different. The solution of problems cannot therefore be identical. It is
conceivable in the western society that a female may level false accusation as regards
sexual molestation against a male for several reasons such as :
(1) The female may be a 'gold digger' and may well have an economic motive to extract
money by holding out the gun of prosecution or public exposure.
(2) She may be suffering from psychological neurosis and may seek an escape from the
neurotic prison by phantasizing or imagining a situation where she is desired, wanted,
and chased by males.
(3) She may want to wreak vengeance on the male for real or imaginary wrongs. She may
have a grudge against a particular male, or males in general, and may have the design to
square the account.
(4) She may have been induced to do so in consideration of economic rewards, by a
person interested in placing the accused in a compromising or embarrassing position, on
account of personal or political vendetta.
(5) She may do so to gain notoriety or publicity or to appease her own ego or to satisfy
her feeling of self-importance in the context of her inferiority complex.
(6) She may do so on account of jealousy.
(7) She may do so to win sympathy of others.
(8) She may do so upon being repulsed".
16. In the second case, which was also of rape, there was delay of three days in lodging
FIR. This Court held that it was not a factor causing doubt on the story of the prosecution
in view of the generally known fact that the rape victim or her husband would hesitate to
approach the police. It was also held that unless the evidence discloses that she and her
husband had strong reasons to falsely implicate the accused, ordinarily the Court should
have no hesitation in accepting her version regarding the incident.
17. In the case on hand, the defence put forward by the respondent-accused was that the
husband of the prosecutrix had taken advance money from PW8-Ramcharan-employer
towards labour charges and since he had no intention to return the said amount, the
prosecutrix falsely implicated the accused in the case. In our considered opinion, the trial
Court rightly rejected the defence. Hence, in our opinion, the order of conviction
recorded by the trial Court and confirmed by the High Court cannot be said to be faulty
and conviction of the respondent-accused cannot be said to be illegal.
18. The next question relates to adequacy of sentence. Let us consider it on principle as
well as in practice, in the light of statutory provisions.
19. Punishment is the sanction imposed on the offender for the infringement of law
committed by him. Once a person is tried for commission of an offence and found guilty
by a competent Court, it is the duty of the Court to impose on him such sentence as is
prescribed by law. The award of sentence is consequential on and incidental to
conviction. The law does not envisage a person being convicted for an offence without a
sentence being imposed therefor.
20. The object of punishment has been succinctly stated in Halsbury's Laws of
@page-SC586
England, (4th Edition; Vol.II; para 482) thus;
"The aims of punishment are now considered to be retribution, justice, deterrence,
reformation and protection and modern sentencing policy reflects a combination of
several or all of these aims. The retributive element is intended to show public revulsion
to the offence and to punish the offender for his wrong conduct. The concept of justice as
an aim of punishment means both that the punishment should fit the offence and also that
like offences should receive similar punishments. An increasingly important aspect of
punishment is deterrence and sentences are aimed at deterring not only the actual
offender from further offences but also potential offenders from breaking the law. The
importance of reformation of the offender is shown by the growing emphasis laid upon it
by much modern legislation, but judicial opinion towards this particular aim is varied and
rehabilitation will not usually be accorded precedence over deterrence. The main aim of
punishment in judicial thought, however, is still the protection of society and the other
objects frequently receive only secondary consideration when sentences are being
decided".
(Emphasis supplied)
21. In justice-delivery system, sentencing is indeed a difficult and complex question.
Every Court must be conscious and mindful of proportion between an offence committed
and penalty imposed as also its impact on society in general and the victim of the crime
in particular.
22

. In B. G. Goswami v. Delhi Administration, (1974) 3 SCC 85, this Court stated: AIR
1973 SC 1457

"Now the question of sentence is always a difficult question, requiring as it does, proper
adjustment and balancing of various considerations which weigh with a judicial mind in
determining its appropriate quantum in a given case. The main purpose of the sentence
broadly stated is that the accused must realise that he has committed an act which is not
only harmful to the society of which he forms an integral part but is also harmful to his
own future, both as an individual and as a member of the society. Punishment is designed
to protect society by deterring potential offenders as also by preventing the guilty party
from repeating the offence; it is also designed to reform the offender and re-claim him as
a law abiding citizen for the good of the society as a whole. Reformatory, deterrent and
punitive aspects of punishment thus play their due part in judicial thinking while
determining this question. In modern civilized societies, however, reformatory aspect is
being given somewhat greater importance. Too lenient as well as too harsh sentences both
lose their efficaciousness. One does not deter and the other may frustrate thereby making
the offender a hardened criminal".
(Emphasis supplied)
[see also Salmond on Jurisprudence, (2004); p.94]
23. Penal laws, by and large, adhere to the doctrine of proportionality in prescribing
sentences according to culpability of criminal conduct. Judges in principle agree that
sentence ought always to commensurate with the crime. In practice, however, sentences
are determined on other relevant and germane considerations. Sometimes it is the
correctional need that justifies lesser sentence. Sometimes the circumstances under which
the offence is committed play an important role. Sometimes it is the degree of
deliberation shown by the offender in committing a crime which is material. Sentencing
is thus a delicate task which requires skill, talent and consideration of several factors,
such as, the nature of offence, circumstances extenuating or aggravating - in which it was
committed, prior criminal record of the offender, if any, age and background of the
criminal with reference to education, home life, social adjustment, emotional and mental
condition, prospects of his reformation and rehabilitation, etc. All these and similar other
considerations can, hopefully and legitimately, tilt the scale on the propriety of sentence.
24. Moreover, social impact of the crime, particularly where it relates to offences against
women, cannot be lost sight of and per se require exemplary treatment. Any liberal
attitude of imposition of meager sentence or too sympathetic view may be counter
productive in the long run and against social interest which needs to be cared for,
protected and strengthened by string of deterrence inbuilt in the sentencing system.
25. Sexual violence apart from being a dehumanizing act is also an unlawful intrusion of
the right to privacy and sanctity of a female. It is a serious blow to her supreme honour
and offends her self-esteem and dignity. It degrades and humiliates the victim
@page-SC587
and leaves behind a traumatic experience. It has been rightly said that whereas a murderer
destroys the physical frame of a victim, a rapist degrades and defiles the soul of a
helpless female. The Courts are, therefore, expected to try and decide cases of sexual
crime against women with utmost sensitivity. Such cases need to be dealt with sternly and
severely. A socially sensitized Judge is a better armour in cases of crime against women
than long clauses of penal provisions, containing complex exceptions and complicated
provisos.
26

. Once a person is convicted for an offence of rape, he should be treated with a heavy
hand. An undeserved indulgence or liberal attitude in not awarding adequate sentence in
such cases would amount to allowing or even to encouraging 'potential criminals'. The
society can no longer endure under such serious threats. Courts must hear the loud cry for
justice by society in cases of heinous crime of rape and impose adequate sentence. Public
abhorrence of the crime needs reflection through imposition of appropriate sentence by
the Court [Dinesh v. State of Rajasthan, (2006) 3 SCC 771]. 2006 AIR SCW 1123
27. Now, let us consider the legal position in the light of statutory provisions and
amendments made. The Law Commission took note of various decisions rendered by this
Court from time to time wherein it was observed that considering the rise in crime and
the growing menace to sexual abuse, necessary change should be made. The Law
Commission, therefore, in its 84th Report stated:
"It is often stated that a woman who is raped undergoes two crises - the rape and the
subsequent trial. While the first seriously wounds her dignity, curbs her individual,
destroys her sense of security and may often ruin her physically, the second is no less
potent of mischief, inasmuch as it not only forces her to relive through the traumatic
experience, but also does so in the glare of publicity in a totally alien atmosphere, with
the whole apparatus and paraphernalia of the criminal justice system focused upon her.
In particular, it is now well established that sexual activities with young girls of immature
age have a traumatic effect which often persists through life, leading subsequently to
disorders, unless there are counter-balancing factors in family life and in social attitudes
which could act as a cushion against such traumatic effects.
Rape is the 'ultimate violation of the self'. It is a humiliating event in a woman's life
which reads to fear for existence and a sense of powerlessness. The victim needs empathy
and safety and a sense of re-assurance. In the absence of public sensitivity to these needs,
the experience of figuring in a report of the offence may itself become another assault.
Forcible rape is unique among crimes, in the manner in which its victims are dealt with
by the criminal justice system. Raped women have to undergo certain tribulations. These
begin with their treatment by the police and continue through a male-dominated criminal
justice system. Acquittal of many de facto guilty rapists adds to the sense of injustice.
In effect, the focus of the law upon corroboration, consent and character of the
prosecutrix and a standard of proof of guilt going beyond reasonable doubt have resulted
in an increasing alienation of the general public from the legal system, who find the law
and legal language difficult to understand and who think that the Courts are not run so
well as one would expect.
28. Pursuant to the Law Commission's Report, Parliament amended Sections 375 and
376, IPC by the Criminal Law (Amendment) Act, 1983. (Act 43 of 1983). Sub-section (1)
of Section 376 now prescribes minimum sentence of rigorous imprisonment of seven
years on the person convicted under Section 376(1) unless the case is covered by proviso.
Sub-section (1) read with proviso is material which reads thus:
376. Punishment for rape
(1) Whoever, except in the cases provided for by sub-section (2), commits rape shall be
punished with imprisonment of either description for a term which shall not be less than
seven years but which may be for life or for a term which may extend to ten years and
shall also be liable to fine unless the woman raped is his own wife and is not under
twelve years of age, in which cases, he shall be punished with imprisonment of either
description for a term which may extend to two years or with fine or with both:
Provided that the Court may, for adequate and special reasons to be mentioned in the
judgment, impose a sentence of imprisonment for a term of less than seven years.
(Emphasis supplied)
@page-SC588
29. The proviso to sub-section (1) of Section 376, IPC thus enjoins the Court if it imposes
less than the minimum sentence of seven years rigorous imprisonment on an offender of
rape to record 'adequate and special reasons' in the judgment. Recording of reasons is,
therefore, sine qua non or condition precedent for imposing sentence less than the
minimum required by law. Moreover, such reasons must be both (i) 'adequate' and (ii)
'special'. What is 'adequate' and 'special' would depend upon several factors and no strait-
jacket formula can be laid down as a rule of law of universal application.
30. In the instant case, 'special' and 'adequate' reasons according to the learned Judge of
the High Court were; (i) the respondent was an 'illiterate agriculturist from rural area' and
(ii) an amount of fine of Rs.2,500/- was imposed on him. No other reason whatsoever has
been mentioned in the judgment, nor is found from the record of the case. With respect to
the learned Judge, in our considered opinion, the so called reasons can neither be said to
be 'special' nor 'adequate'. On the contrary, in the Special Leave Petition seeking leave to
appeal, the applicant-State has averred that the learned Judge was in the habit of passing
such orders by reducing sentence to the period 'already undergone' in serious offences
punishable under Sections 304, 307, 376, etc. A list is also given of some of the matters
decided by him. Our attention was also invited by the learned Government Advocate that
in several cases, this Court has set aside the decisions rendered by the same learned
Judge.
31. In our judgment, by passing the order impugned in the present appeal and by reducing
the sentence imposed on the respondent by the trial Court to the 'period already
undergone' which was only two months and three days, the learned Judge of the High
Court has committed grave illegality which had resulted in 'miscarriage of justice'. There
were no reasons much less 'adequate' and 'special' reasons to reduce the sentence less than
the minimum required to be imposed under sub-section (1) of Section 376, IPC. The
order is, therefore, liable to be set aside. On the facts and in the circumstances of the case,
in our opinion, the trial Court was wholly right and fully justified in awarding rigorous
imprisonment for seven years as envisaged by sub-section (1) of Section 376, IPC and
there was no earthly reason to interfere with the said order by the High Court. The appeal,
therefore, deserves to be allowed.
32. For the foregoing reasons, the appeal filed by the State is allowed. The order of
conviction recorded by the trial Court and confirmed by the High Court is upheld. The
High Court was, however, wrong in reducing the sentence and the trial Court rightly
imposed rigorous imprisonment of seven years on the respondent-accused. We, therefore,
restore that part of the order of the trial Court directing the respondent to suffer rigorous
imprisonment for seven years. It goes without saying that the period of sentence already
undergone by the respondent-accused will be given set off.
33. Ordered accordingly.
Appeal allowed.
AIR 2008 SUPREME COURT 588 "Dadan Ram v. State of Bihar"
(From : Patna)
Coram : 2 TARUN CHATTERJEE AND P. SATHASIVAM, JJ.
Civil Appeal No. 26 of 2001, D/- 23 -11 -2007.
Dadan Ram and Ors. v. State of Bihar and Ors.
Bihar Land Reforms (Fixation of Ceiling Area and Acquisition of Surplus Land) Act (12
of 1962), S.45B - LAND REFORMS - LAND CEILING - NATURAL JUSTICE -
Reopening of proceedings - Notice to all parties including person(s) in possession of land
in question - Mandatory - Fact that person(s) in possession had knowledge of order of
status quo passed by District Collector - Would not be substantial compliance of rules of
natural justice.
(2003) 10 SCC 239, Rel. on. (Paras 11, 12, 13)
Cases Referred : Chronological Paras
(2003) 10 SCC 239 (Rel. on) 11
S. B. Sanyal, Sr. Advocate, Ranjan Mukherjee, for Appellants; P. S. Mishra, Sr. Advocate,
Dhruv Kumar Jha, Upendra Mishra, Ravi Chandra Prakash, Himanshu Shekhar, Gopal
Singh, Anukul Raj, Manish Kumar, for Respondents.
Judgement
P. SATHASIVAM, J. :-Whether the parcha holders, who are in possession of the land in
question, have any right to be heard in a proceeding arising out of Section 45-B of the
Bihar Land Reforms (Fixation of
@page-SC589
Ceiling Area and Acquisition of Surplus Land) Act, 1961 (hereinafter referred to as the
Act) is the only question to be decided in this appeal.
2. This appeal is directed against the impugned final judgment and order dated 14.9.1999
passed by the Division Bench of the High Court of Judicature at Patna in L.P.A. No. 1545
of 1997 whereby the High Court dismissed the L.P.A. filed by the appellants herein
against the judgment and order dated 24.11.1997 passed by the learned single Judge of
the High Court in C.W.J.C. No. 12036 of 1996 arising from a proceeding under Section
45-B of the Act.
3. The Ceiling (surplus) proceedings bearing Ceiling Case No. 149 of 1973-74 were
initiated against Nand Kishore Tiwari, respondent No.8 herein and a notice to the said
effect was issued to him under Section 6(1) of the Act in Form LC-1 as prescribed under
Rule 5 under the said Act and respondent No.8 submitted a return under the said Act in
respect of his entire land, total 19 acres 71 decimals. The aforesaid land was found to be
owned and possessed by the family as defined in Section 2(ee) of the said Act i.e. land
holder, respondent No.8, his wife Sumitra Devi and their two minor children as on
appointed day i.e., 9.9.1970 and ultimately the authority concerned by holding 15 acres of
class I lands was permitted to be retained by respondent No.8 under Section 5(1) and the
remaining 4.64 acres of land were declared as surplus. Final publication of draft
statement under Section 11(1) of the said Act was accordingly made and subsequent to
that a notification under Section 15(1) was also issued on 15.1.1993. Against the said
notification, respondent No.8 filed an appeal under Section 30(1)(b) of the Act before the
Commissioner, Patna Division, Patna bearing Ceiling Appeal No. 160 of 1994. The
Commissioner dismissed the appeal on merits. Dissatisfied therewith, a Ceiling Revision
was filed before the Member, Board of Revenue, Bihar, Patna which was also dismissed.
Writ Petition filed for quashing the earlier orders was dismissed by the High Court.
Subsequently another writ application which was filed in the High Court by respondent
No.8 herein and the same was disposed of with a direction to raise the matter before the
Collector of the District within two weeks from the date of the receipt of the order.
However, no such application was filed by respondent No.8 before the District Collector,
therefore, after the expiry of said such period, the High Courts order became infructuous.
The wife of respondent No.8, namely, Sumitra Devi filed an application before the
District Collector for re-opening the case under Section 95-B of the Ceiling Act and the
same was dismissed. Challenging the order of the District Collector as well as the orders
of the appellate Court which was passed in the appeal filed by respondent No.8 and the
order passed in Revision application, an application under Section 32 of the Act was also
filed before the Member, Board of Revenue, Bihar and the same was finally disposed of
on 12.7.1995 with a direction that the Collector shall ascertain the allegation. After final
publication under Section 15(1) of the Ceiling Act, the aforesaid excess land i.e. 4 acres
64 decimals was distributed to 8 down-trodden people of the village and separate parchas
were issued in name of the aforesaid eight persons and the possession was also delivered
to them. The District Collector transferred the case to the Court of Additional Collector
who re-opened the case, conducted the impugned proceedings in question and held that
the land holder has no excess land. Accordingly, he set aside the notification issued under
Section 15(1) of the Ceiling Act. Respondent No.5 before disposal of the application
under Section 45-B of the Ceiling Act, did not issue notice nor opportunity was given to
the appellants with whom the aforesaid lands were in possession.
4. Being aggrieved, the appellants filed C.W.J.C. No. 12036 of 1996 before the High
Court. Learned single Judge of the High Court dismissed the same. Dissatisfied
therewith, L.P.A. was filed before the Division Bench of the High Court of Patna. The
Division Bench of the High Court dismissed the same affirming the order passed by the
learned single Judge. Aggrieved by the said order, the appellants filed the present appeal
by way of special leave petition
5. We heard Mr. S.B. Sanyal, learned senior counsel for the appellants and Mr. P.S.
Mishra, learned senior counsel for the contesting private respondent Nos. 8 and 9 and Mr.
Gopal Singh, learned counsel for the State of Bihar.
6. After taking us through the entire proceedings including the orders passed by the
authorities under the Act as well as the High Court, Mr. S.B. Sanyal, learned senior
counsel, for the appellants mainly submitted that
@page-SC590
inasmuch as the appellants-parcha holders who were in lawful possession of the land in
question and continuing the same even today are entitled to notice and opportunity of
being heard in a proceeding arising out of Section 45 of the Act. He also contended that
in view of abuse of process by the contesting private respondent Nos. 8 and 9 who are
none else than husband and wife, all the orders are liable to be quashed. On the other
hand, Mr. P.S.Mishra, learned senior counsel for respondent Nos. 8 and 9 submitted that
in view of order of status quo which was passed in the presence of both parties even in
the absence of the separate notice in a proceeding under Section 45-B of the Act in the
facts and circumstances, the rules of natural justice were substantially complied with and
hence there is no ground for interference by this Court under Article 146 of the
Constitution of India.
7. We have carefully perused the annexures and relevant materials and considered the
rival contentions with reference to the pleadings.
8. If we accept the first contention of the learned senior counsel for the appellants,
namely, notice or opportunity of being heard in a proceeding under Section 45-B of the
Act, there is no need to consider the other contentions. It is seen from the materials
placed, after proper notice, the land holder and respondent No.8, and his wife - Sumitra
Devi and their two minor children on the appointed day, i.e., 09.09.1970 were permitted
to retain 15 acres of class-I lands and the remaining 4.64 acres of land were declared as
surplus. Based on the same, a notification under Section 15(1) was issued on 15.01.1993.
The appeal as well as the revision filed against the same was dismissed. The writ petition
filed by the 8th respondent was also dismissed. When special leave petition was filed
against the order of the High Court, the same was disposed of with a permission to the
applicant to raise the matter before the Collector of the concerned District. It is brought to
our notice that though no such petition was filed by the 8th respondent, subsequently his
wife - Sumitra Devi - 9th respondent herein has filed an application before the District
Collector, Bhojpur 4th respondent-herein for re-opening the case under Section 45-B of
the Act. The said application was dismissed by the District Collector and subsequent to
that an application under Section 32 of the said Act was filed before the Member, Board
of Revenue, Bihar challenging the entire order of the District Collector. The same was
finally disposed of on 12.07.1995 with a direction to the Collector to consider the
grievance of Sumitra Devi. It is further seen that the District Collector, Bhojpur
transferred the case to the Court of Addl. District Collector who re-opened the case and
found that the land holder has no excess land and notification issued under Section 15(1)
of the Act was to be set aside. Questioning the said proceedings, the appellants filed
CWJC No. 12036 of 1996 before the High Court, Patna. Learned Single Judge, who
heard the matter, dismissed the same by order dated 24.11.1997. Dissatisfied with the said
order, an appeal was filed before the Division Bench in L.P.A. No. 1545 of 1997 which
was also dismissed affirming the order dated 24.11.1997 passed by the learned Single
Judge.
9. At this juncture, it is relevant to mention that based on the earlier proceedings holding
that the 8th respondent herein was having excess land of 4.64 acres, the authority
concerned, after following the procedure, and after proper verification assigned the
excess lands in favour of the appellants. According to them, from that date onwards, they
are in possession of the assigned lands and they are the parcha-holders.
10. Since initially at the instance of 8th respondent and thereafter his wife - Sumitra Devi
9th respondent-herein, the case was re-opened and found no excess land available, it is
useful to refer the relevant provision, i.e., Section 45-B of the Act. The said provision was
inserted by Bihar Act 22 of 1976. The Section reads as under:-
"45-B. State Government to call for and examine records.- The State Government *[or
the Collector of the district who may be authorized in this behalf] may, at any time, call
for and examine any record of any proceeding disposed of by a Collector under the Act
and may, if it thinks fit, direct that the case be reopened and disposed of afresh in
accordance with the provisions of the Act."
* Deleted by Act 8 of 1997
11. It is not in dispute that prior to the aforesaid amendment, there was no such power
enabling the Collector, Member, Board of Revenue or State Government to re-open the
case for fresh disposal which had been
@page-SC591
concluded. By the aforesaid Section 45-B, power has been vested in the State
Government or in the Collector of the District (since deleted by Act 8 of 1997) re-
opening of cases which had been disposed of so that they may be heard afresh in
accordance with the provisions of the Act. Though the amended provision contains very
wide and extra-ordinary power, admittedly no guidelines have been provided as to when
such power is to be exercised. In fact, no period of limitation has been fixed, the result
whereof may be that a proceeding which had been initiated under the provisions of the
Act and has been concluded by final orders passed by the original, appellate and the
revisional authority can be re-opened after lapse of several years. The amended provision
also makes it clear that while exercising powers under the said provision, no one can act
as an appellate or revisional Court. It is an extra-ordinary power which can be invoked
only if earlier order is found to have been passed not in accordance with the Act. The
proceedings under the amended section are quasi judicial, the right to get opportunity of
hearing cannot be denied in such proceedings. Under this section initially both the State
Government/Collector has the jurisdiction, but by the amendment Act 8 of 1997, State
alone is empowered to re-open such matters for valid reasons. The proceedings are quasi
judicial in nature. Considering the fact that the State Government and previously the
District Collector were authorized to re-open the issue which was concluded, we are of
the view that prior to re-opening, issue of notice and opportunity of hearing of the land
holder or person in possession of the land are mandatory. In the instant case, from the
materials it is clear that the appellants as parcha holders, though the issue was re-opened
they were not issued notice or given an opportunity to put-forth their case. Though the
High Court has concluded that in view of the order of status quo which was passed in the
presence of both parties including the present appellants, the rules of natural justice were
substantially complied with in view of the power conferred on the State Government to
re-open a case that too even after final notification, the person/persons who are in
possession of the land in question or parcha holders are entitled opportunity of notice and
they must be heard before final decision being taken. In this regard, it is useful to refer to
the decision of this Court in Baban Paswan and Another vs. Pratima Devi and Others,
(2003) 10 SCC 239. The case relates to determination of the ceiling area in respect of the
family of Prabal Pratap Singh and Dinesh Prasad Singh and it was then worked out that
43.26 acres was excess land. The respondent 1 - Pratima Devi being the sister of the
aforesaid two persons raised some dispute stating that she was not heard in the matter. In
the meanwhile the surplus land was distributed to different persons and the appellants
came into possession of some areas of that surplus land pursuant to the allotment made in
their favour in 1985. Thereafter, Prabal Pratap Singh and Dinesh Prasad Singh filed a writ
petition challenging the aforesaid determination of the excess land and also the
distribution in favour of the appellants. Though the appellants were made parties in the
said writ petition, the High Court ultimately dismissed their writ petition and the LPA
filed by those two persons was withdrawn subsequently. Thereafter, the 1st respondent
Pratima Devi filed CWJC No. 323 of 1999 before the High Court contending that she was
not heard and she was vitally interested in the matter before determining the ceiling area
applicable to the family of Pratima Devi, Prabal Pratap Singh and Dinesh Prasad Singh.
In that writ petition, the appellants in this Court were not made parties though the land
was in the lawful possession of the appellants. The writ petition was allowed by the High
Court by ordering certain areas claimed by the 1st respondent to be excluded from the
ceiling limit of the aforesaid two persons (Prabal Pratap Singh and Dinesh Prasad Singh).
When the appellants came to know about the said verdict of the High Court in the writ
petition they filed LPA by obtaining permission. But the LPA was dismissed by a
Division Bench of the High Court holding that the appellants/parcha-holders cannot
acquire any right merely because parcha has been issued in their favour and since the
acquisition has been held to be invalid they have no option but to walk out. Questioning
the said order, the appellants have filed special leave petition before this Court.
Considering the issue which is similar to our case, this Court held as under:
"5. We are not inclined to take the view that the appellants are not entitled to be heard in
the writ petition filed by the 1st respondent Pratima Devi merely because the
determination of the ceiling area had taken
@page-SC592
place at a time when the appellants had no right in the land. The appellants have been put
in possession of the land way back in 1985 by holding that it was a surplus area
pertaining to the family. They being in the enjoyment of the land on the strength of the
said allotment, they must have the right to substantiate that the allotment has been rightly
made in their favour and the area was rightfully held to be surplus area."
After holding so, this Court set aside the judgment passed by the learned Single Judge
and the Division Bench of the High Court and remitted to the High Court for disposal
after affording opportunity to the appellants. The decision therein is directly applicable to
the case on hand particularly in the light of the language used in amended Section 45-B
of the Act.
12. In view of the same, we are unable to agree with the observation of the Division
Bench since the appellants had the knowledge of the order of status quo passed by the
District Collector on 24.8.2005, the rules of natural justice were substantially complied
with. We have already held that prior to re-opening, notice to all the parties including
person(s) in possession was mandatory. It is not in dispute that the case was re-opened
and earlier decision was reversed holding that there was no excess land without issuing
notice to the appellants. Section 45-B empowers the State Government to re-open the
case which was already been disposed of by the Collector under the Act. After re-opening
the case, the State Government is to dispose of the matter afresh in accordance with law.
It is, therefore, clear that before passing any order in a concluded issue, the authority is
expected to satisfy the minimum requirement of principles of natural justice by issuance
of notice and hearing. Further, the said power to re-open has to be exercised sparingly
and for adequate reasons and the proceeding concluded earlier cannot be re-opened
merely for verification whether the orders were correctly passed. The order of re-opening
should be passed after hearing the parties concerned and where an order of re-opening the
case had been passed without hearing the party against whom it was passed, the order
suffers with legal infirmity and liable to be quashed. The reason behind in issuing a show
cause notice is precisely very clear in view of the fact that a proceeding once concluded
after a regular hearing should not be ordered to be re-opened suo motu by the authorities
concerned in a capricious manner and reasonableness requires that parties to be affected
by the same should be heard.
13. In this view of the matter, we are of the view that the orders impugned suffer from the
infirmity of not giving reasonable opportunity to the appellants before reopening the
proceedings. The order, therefore, is liable to be set aside. Under these circumstances, the
order of the High Court both learned Single Judge and the Division Bench are set aside.
However, the State Government is free to pass fresh order if they so desire under Section
45-B of the Act after affording opportunity to all the parties including the appellants
herein. Civil appeal is allowed to this extent. No costs.
Order accordingly.
AIR 2008 SUPREME COURT 592 "Amit Kumar v. State of U. P."
(From : Allahabad)*
Coram : 2 C. K. THAKKER AND ALTAMAS KABIR, JJ.
Civil Appeal No. 5455 of 2007 (arising out of SLP (C) No. 7731 of 2005), D/- 28 -11
-2007.
Amit Kumar v. State of U. P. and Ors.
U.P. Entertainment and Betting Tax Act (28 of 1979), S.3, S.11(3) - ENTERTAINMENT
TAX - Entertainment tax - Exemption as educational charity show - Fashion show -
Alleged to be charity show held with object of settings of Institute of Art, fashion
designing and modelling - Advertisement issued however showing that object of show
was to invite people to come and watch new world of glamour and modelling - Show
cannot be said to be educative for prospective students - Liable to levy of entertainment
tax - Show was held with full knowledge that tax was payable - Issuance only of
invitation cards and not tickets was only a subterfuge to evade tax. (Para 15)

Pramod Kumar Yadav, Viresh Kumar Yadav and Rameshwar Prasad Goyal, for Appellant;
S. K. Dwiwedi, Vinha Dwivedi, G. V. Rao, Raj Kumar Gupta, Ms. Vandana Mishra,
Kamlendra Mishra and Raj Kumar Mehta, for Respondents.
@page-SC593

* C. M. W. P. No. 2166 of 2002, D/- 22-2-2005 (All).


Judgement
ALTAMAS KABIR, J. :-Leave granted.
2. This appeal by way of Special Leave involves the question as to whether entertainment
tax was payable by the appellant in respect of a fashion show held at Gorakhpur in Uttar
Pradesh on 9th July, 2000 at St. Andrews Inter College for the selection of "Mr.
Gorakhpur" and "Miss Gorakhpur".
3. As it would appear from the materials on record, the appellant was found to be the
organiser of the aforesaid fashion show which had been held without the permission of
the District Magistrate. On the basis of enquiry, it was found that entertainment tax had
not been paid for performing the aforesaid fashion show and accordingly a show cause
notice was issued to the appellant which was replied to by the appellant. Not being
satisfied with the explanation given, the District Magistrate assessed a sum of
Rs.43,270.00 by way of entertainment tax for the programme and a further sum of
Rs.20,000.00 by way of penalty which was imposed upon the Cambridge Intertia Group
under whose banner the appellant is said to have arranged the fashion show.
4. In his reply to the show cause notice dated 11th July, 2000 under Section 12 of the
Uttar Pradesh Entertainment and Betting Tax Act, 1979 (hereinafter referred to as 'the
1979 Act'), the appellant contended that he was only a choreographer of Cambridge
Intertia Group which arranged the programme. The appellant contended that the
programme, as arranged, did not attract the provisions of the aforesaid Act and that the
show cause notice was without jurisdiction. A specific stand was also taken that Section 5
of the 1979 Act provided that any programme relating to entertainment could not be held
without prior permission but that since the programme was not entertainment within the
meaning of the Act, the same had been held by the Institution with prior intimation to the
office of the District Magistrate. It was reiterated that the programme was of a
competitive nature and there was no element of entertainment involved. Furthermore,
neither was any cultural, music and dance programme conducted nor was any amount
collected from the spectators by way of entry fee. According to the appellant, the show
was organised as a charity show with the specific purpose of publicising the event,
inasmuch as, there was a proposal initiated by Ms. Neetu Nathaniel (respondent No. 7
herein) for establishing an Institute of Art, Fashion, Designing and Modelling at
Gorakhpur in collaboration with the respondent No. 8, Smt. S. Mishra, proprietor of the
Cambridge Intertia Group.
5. Another stand taken by the appellant in the reply to the show cause notice was that
Miss Neetu Nathaniel was the Director and Smt. S. Mishra was the Convener of the show
and that the entire programme had been conducted under the direction of Miss Neetu
Nathaniel. In his reply, the appellant requested the District Magistrate to issue notice to
Miss Neetu Nathaniel who could enlighten him as to the alleged collection of money
against tickets sold and funds collected from the organisers. Since the appellant was only
a choreographer and his main function was to provide information about the candidates
participating in the programme, he denied that he had been involved with the holding of
the programme other than as a choreographer for the show.
6. As mentioned hereinabove, by his order dated 24th July, 2000 the District Magistrate,
Gorakhpur did not accept the explanation offered by the appellant and also the contention
that Miss Neetu Nathaniel was, in fact, the Director of the programme with Smt. S.
Mishra as the Convener. The District Magistrate chose to rely on the report submitted by
his department as to the collection of entry fee from the spectators and funds from the
organisers. Reference was also made to other shows of similar nature held in Gorakhpur
where fashion shows had been held after depositing the entertainment tax payable in
respect thereof and after obtaining the permission of the District Magistrate. Rejecting the
explanation offered by the appellant, the District Magistrate came to the conclusion that
the appellant had collected a total sum of Rs.1,62,500.00 from the spectators and a further
sum of Rs.25,000.00 from the five organisers at the rate of Rs.5,000/- from each
organiser. It was on that basis that a demand was raised by way of entertainment tax for
Rs.43,270.00 at the rate of 30% on the total collected amount of Rs.1,87,500.00.
7. The appellant challenged the said order of the District Magistrate by way of Civil
Misc. Writ Petition No. 2166/2002 in the Allahabad High Court. The same was taken up
for disposal on 22nd February, 2005 and
@page-SC594
on behalf of the writ-petitioner/appellant herein, it was sought to be reiterated that the
writ-petitioner/appellant was only the choreographer and had no function in holding the
fashion show. It was also urged that the programme in its entirety was charitable in nature
and being for an educational purpose, was exempted under Section 11(3) of the 1979 Act.
8. Negating the claim of the writ-petitioner/appellant, the High Court held that a fashion
show could not be said to be in aid of education and was only meant to entertain the
public. On the said finding, the Allahabad High Court dismissed the writ petition against
which the appellant filed SLP(C) No. 7731 of 2005 wherein leave has been granted.
9. Mr. Rameshwar Prasad Goyal, learned Counsel appearing for the appellant, reiterated
the submission which had earlier been made before the District Magistrate and the High
Court and submitted that the fashion show being merely competitive in nature and being
organised for the sake of publicity in connection with the proposed establishment of an
Institute of Art, Fashion Designing and Modelling by the Cambridge Intertia Group, the
provisions of the 1979 Act were not at all attracted and the show cause notice which had
been issued by the District Magistrate was without jurisdiction or in excess of the
jurisdiction vested in him under the Act.
10. Mr. Goyal urged that both the District Magistrate as also the High Court had wrongly
arrived at the conclusion that the appellant was responsible for organising and holding the
fashion show. He reiterated the submission made earlier before the other authorities that it
was the Respondent Nos. 7 and 8 who were the real organisers and convener of the
fashion show and the liability of entertainment tax, if any, had been wrongly foisted upon
him.
11. On behalf of Respondent Nos. 1 to 6, it was, however, submitted by Mr. S.K.
Dviwedi, the Additional Advocate General for the State of U.P., that the submissions
made on behalf of the appellant would be disproved on a perusal of the advertisement
which was published on the occasion, being Annexure CA-2 of the Counter Affidavit
filed on behalf of the Respondent Nos. 1 to 5. Mr. Dviwedi submitted that from the said
advertisement it would be clear that while Cambridge Intertia Group as an Institute of
Art, Fashion Designing and Modelling was presenting the fashion show, the Respondent
No. 7 was the Director, the Respondent No. 8 was the Programme Manager and the
appellant was the Programme Director and Choreographer on the occasion which was to
be attended by a Minister of the State Government together with various persons shown
as the sponsors of the programme.
12. Mr. Dviwedi also submitted that since the Minister was the Chief Guest at the fashion
show, various arrangements had been made so that the programme could be conducted
safely and without any disturbance. Furthermore, one of the sponsors shown in the
advertisement, namely, Mr. Pradeep Tekriwal, had specifically written to the authorities
informing them that he was neither a sponsor of the programme nor did he have anything
to do with the programme including making any monetary contribution.
13. Mr. Dviwedi submitted that both the District Magistrate and the High Court had
rightly held that the stand taken on behalf of the appellant that the fashion show was
merely a charity show was not tenable and it had been rightly held that the same was for
the purpose of entertainment and that large sums of money had been collected from the
spectators on the occasion. Mr. Dviwedi also submitted that despite the efforts of the
appellant to shift the liability of payment of the entertainment tax demanded by the
Respondent Nos. 7 and 8, it had been established that it was the appellant who had
master-minded the show with the full knowledge that the same was being held for the
purpose of entertainment and that entertainment tax was payable in respect thereof under
the 1979 Act.
14. Mr. Dviwedi submitted that no case had been made out on the appellant's behalf for
interference with the orders passed by the District Magistrate which were upheld by the
High Court.
15. We have carefully considered the submissions made on behalf of the respective
parties and we are inclined to agree with Mr. Dviwedi that the fashion show was held
with full knowledge that entertainment tax was payable in respect thereof and that though
tickets may not have been issued in respect of the programme and only invitation cards
had been issued, the same was merely a subterfuge for the purpose of evading and/or
avoiding payment of entertainment tax.
@page-SC595
It is difficult to believe that the fashion show was held with the object of educating
prospective students who would be interested in joining the Institute of Art, Fashion
Designing and Modelling and was, therefore, exempt under Section 11(3) of the 1979
Act. As the advertisement referred to above indicates the object of the show was to invite
people to come and watch the new world of glamour and modelling and to see the world
of exotic fashion in Gorakhpur itself.
16. We, therefore, see no reason to interfere with the order passed by the District
Magistrate, Gorakhpur and the High Court and we have no hesitation in dismissing the
appeal, but there will be no order as to costs.
17. While parting with the appeal, however, we cannot but remark upon some of the
statements made in the Writ Petition filed by the appellant before the High Court,
particularly those made in paragraphs 11 and 13 which, in our view, had little or no
relevance to the issue involved in the present appeal.
Appeal dismissed.
AIR 2008 SUPREME COURT 595 "B. S. Council of Ayurvedic and Unani Medicine v.
State of Bihar"
(From : Patna)*
Coram : 2 B. N. AGRAWAL AND PRAKASH PRABHAKAR NAOLEKAR, JJ.
Civil Appeal No. 4643 with 4644-4645 and 4646 of 2003, D/- 1 -11 -2007.
Bihar State Council of Ayurvedic and Unani Medicine v. State of Bihar and Ors.

WITH
Dr. Sudhir Kumar Singh and Ors. v. State of Bihar and Ors.

AND
Ashok Kumar and Ors. v. State of Bihar and Ors.
(A) Indian Medicine Central Council Act (48 of 1970), S.14, Sch.2 - Bihar Development
of Ayurvedic and Unani Systems of Medicine Act (31 of 1951), S.1 - MEDICAL
COUNCIL - CONSTITUTIONALITY OF AN ACT - Validity - 1951 State Act and 1970
Central Act are complementary to each other - Second Schedule of 1970 Act permits
grant of GAMS degree (Graduate of Ayurvedic Medicine and Surgery) - Introduction of
B. A. M. S. degree by 1970 Act - It cannot be said that GAMS degree issued by faculty
was derecognised or not in operation thereafter.
The Bihar Development of Ayurvedic and Unani Systems of Medicine Act (1951) is
consistent with the Indian Medicine Central Council Act (1970) in regard to granting of
the GAMS degree, as the degree granted under the 1951 State Act is still recognized
under the 1970 Central Act. The 1951 State Act and the 1970 Central Act are
complementary to each other. The faculty comes under the definition of 'medical
institution' under Section 2(f) of the 1970 Central Act and GAMS degree awarded by the
Faculty is a recognised medical qualification under Section 14 of the 1970 Central Act.
The Second Schedule of the 1970 Act grants authority to the Faculty to grant GAMS
degree. The High Court has, therefore, clearly committed an error in holding that after the
BAMS degree has been introduced, GAMS degree issued by the Faculty was
derecognised or not in operation after the 1970 Act came into force.
(Paras 11, 12)
(B) Bihar Indigenous Medical Educational Institution (Regulation and Control) Act (20
of 1982), S.5 - Indian Medicine Central Council Act (48 of 1970), S.14, Sch.2 - Bihar
Development of Ayurvedic and Unani Systems of Medicine Act (31 of 1951), S.54 -
MEDICAL COUNCIL - EDUCATION - Recognition of degree - Degree already granted
to students, recognised under 1951 Act - Accepted to be recognised degree under 1970
Act - Would not be ipso facto illegal on ground that permission to colleges of said
students was not granted by State Govt. as required under 1982 Act - State Govt.,
however, directed to take appropriate steps under the 1982 Act if any body, agency,
college or institution is/are functioning without permission as required under 1982 Act.
(Para 20)
(C) Indian Medicine Central Council Act (48 of 1970) (as amended by Amendment Act
2003), S.13A, S.13B, S.13C - MEDICAL COUNCIL - AMENDMENT - EDUCATION -
Degree conferred on students prior to commencement of Amending Act , 2003 - Is to be
treated as recognised degree - Although concerned medical college has not sought
permission of Central Govt. within period of three years from commencement of
Amending Act, 2003.
L. P. A. No. 463 of 2000, D/- 12-12-2001 (Pat.), Reversed.
@page-SC596

The amendment brought about in the Indian Medicine Central Council Act, 1970, in 2003
by introduction of Ss. 13A, 13B and 13C are the provisions for continuance of the
institution which has not obtained prior permission of the Central Government and,
therefore, time limit of three years has been provided under S. 13C to regularize the
institution's affairs as required under the Act by seeking permission of the Central
Government. Insertion of Section 13A in the 1970 Central Act in the year 2003 has
regulated the opening of an indigenous medical college. The non-obstante clause clearly
indicates that a medical institution cannot be established except with the prior permission
of the Central Government. Under S. 13B, any medical qualification granted by the
colleges established without the prior permission of the Central Government is not a
recognized medical qualification. The reasonable reading of S. 13C(1) puts the existing
colleges at par with the new colleges as both of them are required to seek permission
within three years from the commencement of the Amending Act. The phrase 'on or
before' has made it clear that the existing colleges are also required to seek permission
and there is no exemption. S. 13C(2) further provides that the medical qualification
granted by existing colleges whose establishment has not been recognized by the Central
Government, the medical qualification would not be a recognized qualification. Similar
requirement is to be fulfilled by the new medical colleges opened, i.e., to seek permission
of the Central Government for the medical qualification to be recognized qualification.
Thus, new colleges or existing colleges cannot any more grant a recognized qualification
without the sanction of the Central Government. S. 13C(2) does not say that the effect of
non-permission by the Central Government to the existing colleges after the Amending
Act came into force would render the medical qualifications already granted by the
existing colleges before the insertion of Ss. 13A, 13B and 13C in 2003, un-recognized.
The whole spectrum of the amendment brought about by introducing Ss. 13A, 13B and
13C indicates that it has an application from the date they have been introduced by an
amendment in the 1970 Central Act. The effect of the amendment brought about is that
all the medical colleges which are in existence or the medical colleges which have to be
established should compulsorily seek permission of the Central Government within the
period provided and on failure to get the permission of the Central Government the
medical qualification granted to any student of such medical college shall not be a
recognized medical qualification for the purposes of the 1970 Act. The established
colleges are also required to seek permission of the Central Government for the medical
qualification to be recognized medical qualification but it would not mean that the
already conferred medical qualification of the students studied in such previously
established medical colleges would not be a recognised medical qualification under the
1970 Act. When a degree has been legally conferred on the students prior to the
commencement of the Amending Act of 2003, it shall be treated as a recognized degree
although the medical college has not sought permission of the Central Government within
a period of three years from the commencement of the Amending Act of 2003. The
provisions of S. 13B whereby the qualification granted to any student of a medical
college would not be deemed to be a recognized medical qualification would not apply.
Therefore, the GAMS degree conferred by unrecognized colleges on the students shall be
treated as a recognized degree for the purposes of taking admission to the higher courses
of study and also for the purposes of employment.
L. P. A. No. 463 of 2000, D/- 12-12-2001 (Pat.), Reversed. (Paras 27, 28, 29)
(D) INTERPRETATION OF STATUTES - Interpretation of Statutes - Words used by
legislature - Construction - Causing injustice or even hardship or inconvenience - Not to
be put unless such was intention of legislature.
Where the legislature has used words in an Act which if generally construed, must lead to
palpable injustice and consequences revolting to the mind of any reasonable man, the
Court will always endeavour to place on such words a reasonable limitation, on the
ground that the legislature could not have intended such consequence to ensue, unless the
express language in the Act or binding authority prevents such limitation being
interpolated into the Act. In construing an Act, a construction ought not be put that would
work injustice, or even hardship or inconvenience, unless it is clear that such was the
intention of the legislature. It is also settled that where the language of the legislature
admits of two constructions and
@page-SC597
if construction in one way would lead to obvious injustice, the Courts act upon the view
that such a result could not have been intended, unless the intention had been manifested
in express words. Out of the two interpretations, that language of the statute should be
preferred to that interpretation which would frustrate it. It is a cardinal rule governing the
interpretation of the statutes that when the language of the legislature admits of two
constructions, the Court should not adopt the construction which would lead to an
absurdity or obvious injustice. It is equally well settled that within two constructions that
alternative is to be chosen which would be consistent with the smooth working of the
system which the statute purported to be regulating and that alternative is to be rejected
which will introduce uncertainty, friction or confusion with the working of the system.
AIR 1961 SC 1549, AIR 1973 SC 1461, Ref. (Para 24)
(E) INTERPRETATION OF STATUTES - Interpretation of Statutes - Court must always
lean to interpretation which is reasonable one - Literal interpretation which does not fit in
with scheme of Act under consideration should be discarded.
1996 AIR SCW 2120, AIR 1986 SC 137, Ref. (Para 25)
Cases Referred : Chronological Paras
1996 AIR SCW 2120 : AIR 1996 SC 1826 (Ref.) 26
AIR 1986 SC 137 (Ref.) 26
AIR 1973 SC 1461 (Ref.) 24
AIR 1961 SC 1549 : 1961 (2) Cri LJ 720 (Ref.) 24
AIR 1959 Punj 497 26
S. B. Sanyal, Sr. Advocate, Akhilesh Kumar Pandey, Sudhanshu Saran, Ms. Ranjana
Narayan, Ms. Shefali Jain, Ranjan Mukherjee, S. C. Ghosh, M. Qamaruddin, Ms. M.
Qamaruddin, Ambar Qamaruddin, Anukul Raj, Gopal Singh, Rituraj Biswas, Shrish
Kumar Misra and Navin Prakash, for the appearing parties.
* L. P. A. No. 463 of 2000, D/- 12-12-2001 (Pat).
Judgement
P. P. NAOLEKAR, J. : The brief facts of the case are that six petitioners in CWJC No.
7253 of 1998 before the Patna High Court who had obtained GAMS (Graduate of
Ayurvedic Medicine and Surgery) degree from the State Faculty of Ayurvedic and Unani
Medicines (for short "the Faculty") established under Section 17 of the Bihar
Development of Ayurvedic and Unani Systems of Medicine Act, 1951 (for short "the
1951 Act") were not permitted to appear in the examination for admission in Post
Graduate Course in Ayurved leading to award of Degree of Doctor of Medicine in
Ayurved. It was the case of the petitioners that they had passed the GAMS examination
conducted by the Faculty under the 1951 Act and were conferred GAMS degree by the
Faculty and, thus, they were qualified to appear in the examination for obtaining the
Degree of Doctor of Medicine in Ayurved. After service of notice, the respondents
entered appearance and the State filed reply wherein the stand taken by the State was that
GAMS Degree obtained by the petitioners in 1997 was not valid and recognized degree
because according to the letter dated 4.7.1998 sent by the Secretary, Central Council of
Indian Medicine (for short "CCIM"), GAMS course was no longer recognized by the
CCIM. The respondent-CCIM alleged that in accordance with the requirements of the
Indian Medicine Central Council Act, 1970 (for short "the 1970 Act"), CCIM had
prescribed regulations providing for BAMS (Bachelor of Ayurvedic Medicine and
Surgery) course at graduate level and MD(Ay.) course at post-graduate level, and only the
course prescribed by CCIM is to be conducted by the universities and the prescribed
degree can only be awarded by them as per the 1970 Act. It was also the case of the
respondents that after the Bihar Indigenous Medical Educational Institution (Regulation
and Control) Act, 1982 (for short "the 1982 Act"), the GAMS degree could only be
recognized if it is conferred on the students who had studied from the colleges recognized
under the 1982 Act.
2. On the pleadings of the parties, the High Court considered the case on the aspect
whether the Faculty under the 1951 Act has unqualified right to grant affiliation to such
institutions or colleges which are not following the BAMS course prescribed by CCIM
through regulations under the 1970 Act and further whether the provisions of the 1982
Act which seek to regulate institutions imparting training in Ayurvedic and Unani
Systems of Medicine shall cover and regulate even those institutions which have been
granted affiliation by the Faculty. The High Court held that the system of course for
GAMS had come to an end for quite some time and BAMS course has been
@page-SC598
followed as per the regulations of CCIM; hence, only on the basis of a continued entry in
the Second Schedule of the 1970 Act which recognized GAMS degree, which is in the
view of the High Court is archaic, no right can be found in the person or institution to
ignore the course validly prescribed by the competent authority-CCIM. The High Court
further held that the 1982 Act aims at curing a rampant evil in concerned colleges in the
State of Bihar and hence the State Government was given control in the matter of making
queries into the standard of educational institutions teaching Indian system of medicine,
and thereafter proceeding for recognition of the institution under the 1982 Act. It was
held that when the petitioners who obtained GAMS degrees had studied in the
educational institutions which have not followed course prescribed by CCIM, the
statutory central authority, and further when such institutions have been run in total
contravention and violation of the 1982 Act, they are not entitled to for issuance of any
writ from the court.
3. Another writ petition being CWJC No. 825 of 1998 filed by Pramila Kumari and Ors.
in the Patna High Court challenged the order whereby they had not been allowed to
compete in the selection for appointment to the post of Ayurvedic Medical Officer on the
basis that they were the holders of GAMS degree from the Bihar State Faculty, which
was claimed to be a recognized degree by the CCIM. The petitioners sought relief that
they be permitted to fill up the forms and to take part in the examination and further for
declaration that GAMS degree granted by the Faculty was equivalent to BAMS degree
granted by a recognized University of the State.
4. The learned Single Judge differed with the view taken by the court in CWJC No. 7253
of 1998 and held that Faculty has been created under the 1951 Act, much prior to the
promulgation of the 1982 Act, the powers under the 1951 Act of granting GAMS degree
by the Faculty is also recognized under the 1970 Central Act as per Second Schedule
thereof. The court was also concerned with the fate of the students who had been
conferred GAMS degree by a body created under the 1951 Act and the degree has been
saved by recognizing it under the 1970 Central Act. In this view, the matter was directed
to be placed before a Division Bench after necessary orders of Hon'ble the Chief Justice.
5. The judgment of the learned Single Judge in CWJC No. 7253 of 1998 was challenged
by filing LPA No. 451 of 2000 by only one petitioner, namely, Dr. Sudhir Kumar Singh
and other petitioners were impleaded in the case as respondents. Also the Bihar State
Council of Ayuyrvedic and Unani Medicine aggrieved by the judgment in CWJC No.
7253 of 1998, filed another letters patent appeal which was registered as LPA No. 463 of
2000. CWJC No. 825 of 1998 was placed along with the LPAs before the Division Bench
for decision. The writ petitioners re-asserted their submissions before the Division Bench
that they had completed the course of GAMS degree and passed examination conducted
by the Faculty under the 1951 Act. As per Second Schedule of the 1970 Act, a central
Act, which contains State-wise entries, entries Nos. 6 to 9A relate to the
institutions/universities of Bihar which recognize GAMS degree under entry No. 6 from
1953 onwards. It was submitted that as the degree conferred on the writ petitioners is a
recognized degree on the basis of the said entry in the 1970 Act, they were entitled to
appear for entrance test to the post-graduate course and also for consideration for
appointment to the post of Ayurvedic Medical Officers on the basis of GAMS degree
which they were holding.
6. The Division Bench agreed with the reasoning adopted by the learned Single Judge in
CWJC No. 7253 of 1990 and held that under the scheme of the 1970 Act as well as the
Bihar Indigenous Medical Educational Institution (Regulation and Control) Ordinance,
1981 which was replaced by Bihar Act 20 of 1982, the CCIM was authorised to prescribe
the course of studies in the system of medicine so that the Indian system of medicine may
maintain uniformity and standard of teaching all over the country, which has been sought
to be achieved by the regulations framed under the 1970 Act. The Division Bench also
agreed with the learned Single Judge that the course of study of GAMS had come to an
end and had been replaced by BAMS course, much before the writ petitioners acquired
their GAMS degree. The Court approved the decision of the learned Single Judge
whereby he had come to the conclusion that the 1982 Act has been enacted to regulate the
indiscriminate opening of indigenous medical institutions in the State by persons or
@page-SC599
bodies registered under the Societies Registration Act, 1960 and had in fact
commercialized the system of education in indigenous medicine; therefore, the
institutions which are not recognized by the State under the 1982 Act could not impart the
study in Ayurvedic medicine. It was held that the State authorities under the 1982 Act
have rightly taken the follow-up action. On these findings being arrived at by the
Division Bench, no merit was found in the LPAs and the writ petition, which were
dismissed by the Division Bench. Aggrieved by the order dated 12.12.2001 passed by the
Division Bench in the LPAs and the WP, the appellants, namely, Bihar State Council of
Ayurvedic and Unani Medicine (in Civil Appeal No.4643/2003), Dr. Sudhir Kumar Singh
and Ors. (in Civil Appeal Nos. 4644-46 of 2003) and Ashok Kumar Singh and Ors. (in
Civil Appeal No. 4646 of 2003) are before us by special leave.
7. It is an admitted fact before us that the writ petitioners have studied from Ramjee
Prasad, Ram Kumari Devi @ Marni Devi Ayurvedic Medical College and Hospital,
Fatuha and Shrihari Shakuntalayam Ayurvedic Medical College, Muzaffarpur, Bihar. The
said colleges were granted affiliation by the Faculty on 19.8.1995 with retrospective
effect from the session commenced in 1992 and they are recognized under the 1951 Act.
8. The Bihar Development of Ayurvedic and Unani Systems of Medicine Act, 1951
received the assent of the President on 12.9.1951 and the assent was first published in the
Bihar Gazette, Extraordinary, dated 17.10.1951. This Act was enacted to provide for the
development of the Ayurvedic and Unani systems of medicine, to regulate their teaching
and practice, and to control the sale of indigenous medicinal herbs and drugs in the State
of Bihar. In exercise of powers under Section 3, the State Government shall, by
notification, constitute a Council to be called the Bihar State Council of Ayurvedic and
Unani Medicines, which shall consist of a President and the Members mentioned in
clauses (a) to (n) of Section 3(1). Under Section 17 of this Act, the Council shall establish
a State Faculty of Ayurvedic and Unani Medicines for the purposes of the Act which shall
consist of a Chairman and the Members enumerated in clauses (a) to (d) of Section 17(1).
Under clause (d) of sub-section (2) of Section 17, it shall be the duty of the Faculty to
recognize educational or instructional institutions of the Ayurvedic and Unani systems of
medicine for purposes of affiliation. Under clause (b) of Section 17(2), the Faculty is
authorized to hold examination and grant certificates to, and confer degrees or diplomas
on, persons who shall have pursued a course of study in the institutions affiliated to the
Faculty. Section 37 of this Act authorizes the Council to establish educational institutions,
prescribe courses of study, etc. subject to the rules as may be prescribed by the State
Government in this behalf. Section 37 clothes the Council with power to establish its own
educational or instructional institutions for the purpose of conducting courses of
Ayurvedic and Unani systems of medicine. Under Section 54, the Council is authorized to
make regulations subject to the provisions of the Act and the rules made by the State
Government.
9. Looking into the aforesaid provisions, it is clear to us that the Council constituted by
the State Government under the 1951 Act shall establish a State Faculty under Section 17
which shall have the authority to recognize educational or instructional institutions of
Ayurvedic and Unani systems of medicine, to conduct examinations of the persons
studying in such affiliated institutions, and to grant certificates and confer degrees or
diplomas.
10. Under Section 54 of the 1951 Act, the Council has framed regulations called the
Bihar Development of Ayurvedic and Unani Systems of Medicines Regulations, 1959.
Regulation 16 thereof provides for courses of study for the Degree (Graduate of
Ayurvedic Medicine and Surgery) (GAMS). Thus, the Faculty established by the Council
under the 1951 Act has been authorized to recognize the educational institutions or
instructional institutions of Ayurvedic and Unani Systems of Medicine and affiliate them
to the Faculty. The Faculty is also authorized to conduct examinations and confer degree
of GAMS.
11. The Indian Medicine Central Council Act, 1970 (Central Act) provides for
constitution of a Central Council of Indian Medicine (CCIM) and the maintenance of a
Central Register of Indian Medicine and for matters connected therewith. This Act was
enacted by the Parliament and came into force on 21.12.1970. Introduction to this Act
reads as under:
@page-SC600
"To consider problems relating to the Indian system of medicine and Homoeopathy a
number of Committees were appointed by the Government of India, which had
recommended that a statutory Central Council on the lines of the Medicinal Council of
India for modern system of medicine should be established for the proper development of
these systems of medicine (Ayurveda, Siddha and Unani). In June, 1966 the Central
Council of Health at its 13th meeting, while discussing the policy on Ayurvedic
education, recommended the setting up of a Central Council for Indian system of
medicine to lay down and regulate standards of education and examinations,
qualifications and practice in these systems. On the basis of the above recommendations
the Indian Medicine Central Council Bill was introduced in the Parliament."
Sections 13A, 13B and 13C with their sub-sections have been substituted by the Indian
Medicine Central Council (Amendment) Act, 2003 (No. 58 of 2003) w.e.f. 7.11.2003,
which prescribe for the permission for establishment of new medical colleges, new
courses of study, etc.; non-recognition of medical qualifications in certain cases; and time
for seeking permission of the Central Government for certain existing or new medical
colleges. We shall deal with these Sections in detail when we take up the submissions of
the counsel of the effect of these Sections on the GAMS degree conferred on the students
prior to coming into force of Amending Act 58 of 2003. Section 14 falling in Chapter III
of the 1970 Central Act provides for recognition of the medical qualifications granted by
any university, board or other medical institution in India which are included in the
Second Schedule. The Second Schedule provides for the recognized medical
qualifications, i.e. degrees/diplomas, awarded by the States/Boards/Faculties/Universities
before the constitution of the Central Council of Indian Medicine. Under the 1970 Act,
the CCIM is competent to prescribe the minimum standard of education including
curriculam and syllabi as well as other requirements like hospital, library, students hostel,
staff for college, staff for hospital, library, herbal garden, requirements of various
departments of colleges, etc. The Second Schedule prescribes the institutions/colleges
and the medical qualifications which are recognized under the Act for the different States.
For the State of Bihar, item No. 6 of the Second Schedule reads as under :

Name of Universities,Board or Medical Institution Recognised Medical Qualifications


Abbreviation for Registration Remarks

xxx xxx xxx


Bihar
6. State Faculty of Ayur-vedic and Unani Medi-cines, Patna, Bihar. Graduate in
Ayurvedic Medicine and Surgery G.A.M.S. From 1953 onwards.
xxx xxx xxx

Under the 1970 Act, the State Faculty established under the Bihar State Council of
Ayurvedic and Unani Medicines (appellant in LPA No. 463 of 2000 and appellant in Civil
Appeal No. 4643 of 2000) is empowered to confer a degree of Graduate in Ayurvedic
Medicine and Surgery (GAMS) from 1953 onwards. It is an admitted fact that the 1951
Act has not been repealed by the 1970 Central Act nor it is the submission of any counsel
appearing for respective parties that the provisions of the 1951 Act, in regard to
conferment of GAMS degree, are repugnant to the provisions of the 1970 Act. The
Second Schedule in the 1970 Act itself recognizes the GAMS degree given by the State
Faculty of Ayurvedic and Unani Medicines, Patna, Bihar from 1953 onwards and thus it
cannot be said that the course prescribed by the Faculty for conferment of a degree of
GAMS is de-recognised under the 1970 Act. The 1970 Act read with regulations made
thereunder prescribes course for conferment
@page-SC601
of a degree of BAMS by a University, whereas the 1951 Act prescribes course for
conferment of a GAMS degree by State Faculty. Degree conferred by a university and
degree conferred by a faculty are different for which separate courses have been
prescribed. The 1951 Act having not been repealed by the 1970 Act, or till the Second
Schedule is not amended de-recognising the degree of GAMS, the degree of GAMS
given by the State Faculty will remain intact. No amendment has been brought about till
today whereby the degree of GAMS given by the State Faculty is de-recognised under the
1970 Act. The 1951 State Act with its rules and regulations, is a complete code for
recognizing and granting affiliation to indigenous medical institutions by the Faculty,
provide the course of study in the institutions, and regulate the functioning of the
institutions affiliated to the Faculty. The Faculty while exercising its powers has to abide
by the conditions laid down in the rules and regulations.
12. The 1951 State Act is consistent with the 1970 Central Act in regard to granting of the
GAMS degree, as the degree granted under the 1951 State Act is still recognized under
the 1970 Central Act. The 1951 State Act and the 1970 Central Act are complementary to
each other. The Faculty comes under the definition of 'medical institution' under Section
2(f) of the 1970 Central Act and GAMS degree awarded by the Faculty is a recognised
medical qualification under Section 14 of the 1970 Central Act. The Second Schedule of
the 1970 Act grants authority to the Faculty to grant GAMS degree. The High Court has,
therefore, clearly committed an error in holding that after the BAMS degree has been
introduced, GAMS degree issued by the Faculty was de-recognised or not in operation
after the 1970 Act came into force.
13. The question, however, is whether with the introduction of the Bihar Indigenous
Medical Educational Institution (Regulation and Control) Act, 1982, the students who
have studied in the colleges which were not recognized under the said 1982 Act could be
conferred with GAMS degree by the Faculty, and if such degrees are conferred what shall
be the fate of the degrees conferred on such students? We would also be required to
consider the effect of the Indian Medicine Central Council (Amendment) Act, 2003,
particularly Sections 13A, 13B and 13C which have been substituted by way of
amendment in the 1970 Act and came into force on 7.11.2003, on the degrees conferred
on the students who have studied in the colleges which have not sought or have not been
given permission as required under Section 13C of the 1970 Act to open the college or
continue the college, by the Central Government.
14. It is urged by the learned counsel for the appellants that the colleges which are
affiliated to the Faculty under the 1951 Act do not require any approval from the State
Government to start or to continue the educational institution or to run the courses of
study in indigenous system of medicine leading to the degree, diploma etc., as included in
Second Schedule of the 1970 Act, as the 1951 Act is a self-contained code. Whereas, it is
the submission of the learned counsel for the respondents that after the Ordinance of 1981
and the Act of 1982 came into force, all colleges which are affiliated to the Faculty or
which have to be opened after the Ordinance of 1981 and the Act of 1982 came into
force, require permission of the State Government for opening or continuing the colleges
or institution running the colleges, imparting education in indigenous system of medicine.
If any college or the educational institution running the college continues the educational
facility, imparting education in indigenous system of medicine leading to the degree,
diploma etc., as included in the Act of 1982 without permission, would run the risk to
their students of not being conferred with a recognized degree and penalties provided
under the 1982 Act. The counsel further submits that after the introduction of 1982 Act
the power of the Faculty to grant affiliation is circumscribed by the requirement of the
State Government's permission to open the college imparting education in Ayurvedic and
Unani systems of medicine.
15. Under the 1951 Act, Section 17 provides for the establishment of the Faculty. Sub-
section (2) of Section 17 provides : it shall be the duty of the Faculty to prescribe the
course of study and curricula for general instructions, or special refresher courses, in
institutions affiliated to the Faculty. By virtue of clause (d) of sub-section (2) of Section
17, the Faculty is to recognize educational or instructional institutions of the Ayurvedic
and Unani systems of medicine for purposes of affiliation. The manner in which the
affiliation is to be given is
@page-SC602
provided in Chapter II of the 1959 Regulations whereunder an application for affiliation
of an institution shall be made to the Registrar, State Council of Ayurvedic and Unani
Medicines, Bihar. After the application is received for affiliation, the Faculty will
scrutinize the application and if it is satisfied on the basis of the material supplied in the
application or otherwise that the institution proposed to be affiliated has nearly fulfilled
or is likely to fulfil all the conditions imposed by the Council established under the Act
and is likely to run efficiently, it would depute an Inspector to visit the institution, make
inquiry and report back to the Faculty. After the completion of the inquiry and submission
of the inspection report, the Faculty shall give recognition to the institution either
permanently or provisionally for a limited period or may reject it. The decision of the
Faculty shall be communicated to the institution concerned as soon as possible. It is clear
from the aforesaid provisions that the Faculty under the 1951 Act has been empowered
with the power to affiliate institutions which are imparting education in Ayurvedic and
Unani systems of medicine.
16. The Bihar Indigenous Medical Educational Institution (Regulation and Control)
Ordinance, 1981 which provides for regulation and control of educational institutions of
indigenous system of medicine in the State of Bihar was promulgated on 16th November,
1981. Preamble to the Ordinance reads as under :-
"Whereas, the Legislature of the State of Bihar is not in session ;
And, whereas, the Governor of Bihar is satisfied that in spite of repeated warnings from
Government through Press Notes and Notices unregulated and indiscriminate opening of
Indigenous Medical Educational Institutions in this State by persons or bodies registered
under the Societies Registration Act, 1960 or otherwise without providing for adequate
teaching facilities is hampering the cause of Indigenous Medical Education and is highly
detrimental to the interest of students, admitted to such institutions after charging heavy
capitation fee or donation and as such the circumstances exist which render it necessary
to prescribe for regulation and control on the opening of College or Institutions of
Indigenous System of Medicine in the State of Bihar - ;......"
17. The Ordinance was later replaced by introduction of the Act, viz., the Bihar
Indigneous Medical Educational Institution (Regulation and Control) Act, 1981 (Act 20
of 1982) which came into force on 21st January, 1982. Section 3 of the Act requires the
Governing Body or Organizing Committee or any body or institution intending to start
medical course of study of indigenous system of medicine, along with requisite
information regarding the study, to apply to the State Government in the Health
Department.

18. Section 5 contemplates that on receipt of an application for permission to open the
medical course of study of indigenous system of medicine, the State Government would
cause the inspection of the body, agency, college or institution by the Central Council of
Indian Medicine (CCIM) or Inspector appointed by the State Government to see whether
the conditions laid down by the CCIM constituted under Section 3 of the 1970 Act are
fulfilled or not. Section 6 further provides that on completion of the inspection the State
Government in the Health Department will seek permission of the Government of India
and the CCIM of India for granting permission to the starting of the course of medical
studies in indigenous system of medicine by the applicant. Section 7 postulates that to all
private medical colleges and medical institutions in indigenous system of medicine,
preparing or intending to prepare students for study in indigenous system of medicine
leading to degree, diploma, etc. and which have not been permanently affiliated to any
University in the State of Bihar, the provisions of the 1982 Act shall apply. The 1982 Act
has been made applicable to all private medical colleges and medical institutions which
are not permanently affiliated to any University in the State of Bihar. By virtue of Section
9, the institutions which have been functioning without prior permission or approval of
the State Government are required to apply for such permission within a period of one
month from the date of coming into force of the 1982 Act. This Section prohibits
admission of the students in such institutions till the grant of permission by the
Government. It also provides that in case the application is not moved within the
stipulated period or the State Government refuses permission, they will be deemed to
have been established in contravention of the provisions of the Act. Section 10 provides
for penalty and a person contravening any of the provisions of
@page-SC603
the Act is made liable for punishment with a fine which may extend to Rs. 10,000/- and
imprisonment for a term which may extend upto three years. In case of continuing
contravention, such person shall be liable to pay a further fine which may extend to
Rs.1,000/- per day after the date of the first conviction for the period during which he is
proved to have persisted in such contravention. The offence is made non-bailable and
cognizable. As per Section 11, if the application moved for permission to start medical
course of study of indigenous system of medicine either under Section 3 or Section 9 is
refused as the institution or college is not found eligible or does not qualify for
permission, it is incumbent on the organizer of such institution to close it down within a
period of three months of refusal of permission. Section 15 gives authority to the State
Government to seize the accounts of an institution contravening the provisions of the Act.
From these provisions, it is apparent that after introduction of the 1981 Ordinance and the
1982 Act, the Governing Body or the Organizing Committee or any body or institution
intending to start any course of study in indigenous system of medicine is required to
seek permission of the State Government to open a private medical college or medical
institution for admitting the students to be conferred with a degree, diploma, etc., as
included in the Second Schedule of the 1970 Act. It is only the Governing Body or the
Organising Committee or any body or institution which has been permanently affiliated
to any University in the State of Bihar is exempted from the provisions of the 1981
Ordinance or the 1982 Act. Institutions already imparting education in indigenous system
of medicine are required to take permission after coming into force of the 1982 Act.
19. The Act provides for imposition of the fine and imprisonment for any person who
contravenes any of the provisions of the 1981 Ordinance or the 1982 Act. If the
permission is refused, the institution will be closed down. Section 13 of the Act further
authorizes the State Government to authorize any officer to enter into the premises of the
institution contravening the provisions of the 1981 Ordinance or the 1982 Act for the
purposes of inspection and carrying into effect the provisions of the Ordinance or the Act.
Such officer may be empowered to close down the institution and to lock and seal it. The
Act also provides provision for seizure of the accounts by the State Government of an
institution contravening the provisions of the Ordinance or the Act. The Act arms the
State Government with various powers including the penal powers. Although the colleges
were opened in the year 1992 without the authority or the permission of the State
Government as required under the Act, no steps have been taken by the State of Bihar,
and the students admitted in the two institutions which were affiliated with the Faculty
were conferred with the GAMS Degree. After reading the provisions of the Act, it is
apparent to us that the 1982 Act is supplementary to the 1951 Act. The 1951 Act although
provides for the inspection of the institutions which have to be affiliated to the Faculty,
does not lay down that the conditions laid down by the CCIM are to be followed and
adhered to. That has been provided under the 1982 Act. So the colleges or the institutions
which want to impart education in the indigenous system of medicine have not only to
follow the conditions laid down by the Faculty or the Council under the 1951 Act, but
also under the 1982 Act. The college or the institution after the Act came into force
cannot continue without the permission of the State Government as contemplated in the
1982 Act.
20. We have examined the provisions of the 1982 Act. The counsel for the State or the
University could not point out as to what shall happen to the degrees given to the students
who studied in the colleges which have been affiliated with the Faculty but without
permission under the 1982 Act. We do not find any provision in the 1982 Act which takes
away the degree already granted to the students conferred by the Faculty, recognized
under the 1951 Act, and is being accepted to be a recognized degree under the 1970 Act.
Therefore, by virtue of introduction of the 1982 Act, it cannot be said that the degrees
conferred on the students who have studied in the colleges which have not been granted
permission by the State Government as required under the 1982 Act, will be ipso facto
illegal and could not be given effect to. However, we make it clear that any body, agency,
college or institution which has not sought permission from the State Government would
not be granted affiliation by the Faculty under the 1951 Act and the State Government
shall take appropriate steps under the 1982 Act if any body,
@page-SC604
agency, college or institution is/are functioning without the permission of the State
Government as required under the 1982 Act.
21. It is then contended by the learned counsel for the State that after the coming into
force of the Indian Medicine Central Council (Amendment) Act, 2003 (for short "the
Amending Act") on 7th November, 2003, if any medical college established on or before
the commencement of the Amending Act does not seek permission of the Central
Government within the period of three years from the said commencement, the medical
qualification granted to any student of such medical college shall not be deemed to be a
recognized medical qualification for the purposes of the 1970 Act. It is submitted that the
two colleges from where the appellant-students were educated having not sought
permission from the Central Government under the 1970 Act, the GAMS degree
conferred on them shall not be a recognized medical qualification for the purposes of the
1970 Act, as a result whereof they are not eligible for admission for higher course of
study or for employment on the basis of the GAMS degree conferred on them which is
not a recognized medical qualification. For this proposition, the learned counsel for the
State has relied upon the provisions of Sections 13A, 13B and 13C which have been
introduced by Amending Act of 2003. For a better understanding of the contentions, the
relevant portions of the Sections are reproduced hereunder:
"13A. Permission for establishment of new medical college, new course of study, etc.- (1)
Notwithstanding anything contained in this Act or any other law for the time being in
force,-
(a) no person shall establish a medical college; or
(b) no medical college shall-
(i) open a new or higher course of study or training, including a post-graduate course of
study or training, which would enable a student of such course or training to qualify
himself for the award of any recognised medical qualification; or
(ii) increase its admission capacity in any course of study or training including a post-
graduate course of study or training,
except with the previous permission of the Central Government obtained in accordance
with the provisions of this section.
Explanation 1.-For the purposes of this section, "person" includes any University or a
trust, but does not include the Central Government.
Explanation 2.-For the purposes of this section, "admission capacity", in relation to any
course of study or training, including post-graduate course of study or training, in a
medical college, means the maximum number of students as may be fixed by the Central
Government from time to time for being admitted to such course or training.
xxx xxx xxx
13B. Non-recognition of medical qualifications in certain cases.-(1) Where any medical
college is established without the previous permission of the Central Government in
accordance with the provisions of section 13A, medical qualification granted to any
student of such medical college shall not be deemed to be a recognised medical
qualification for the purposes of this Act.
(2) Where any medical college opens a new or higher course of study or training
including a post-graduate course of study or training without the previous permission of
the Central Government in accordance with the provisions of section 13A, medical
qualification granted to any student of such medical college on the basis of such study or
training shall not be deemed to be a recognised medical qualification for the purposes of
this Act.
(3) Where any medical college increases its admission capacity in any course of study or
training without the previous permission of the Central Government in accordance with
the provisions of section 13A, medical qualification granted to any student of such
medical college on the basis of the increase in its admission capacity shall not be deemed
to be a recognised medical qualification for the purposes of this Act.
13C. Time for seeking permission for certain existing medical colleges.- (1) If any person
has established a medical college or any medical college has opened a new or higher
course of study or training or increased the admission capacity on or before the
commencement of the Indian Medicine Central Council (Amendment) Act, 2003, such
person or medical college, as the case may be, shall seek, within a period of three years
from the said commencement, permission of the Central Government in accordance with
the provisions of section 13A.
(2) If any person or medical college, as
@page-SC605
the case may be, fails to seek permission under sub-section (1), the provisions of section
13B shall apply, so far as may be, as if permission of the Central Government under
section 13A has been refused."
22. For the purposes of the 1970 Act, 'Indian medicine' is a system of Indian medicine
commonly known as Ashtang Ayurveda, Siddha or Unani Tibb. Section 2(ea) of the 1970
Act defines 'medical college' to mean a college of Indian medicine where a person
undergoes a course of study or training which will qualify him for the award of a
recognized medical qualification. Section 13A(1) prohibits any person to establish a
medical college; and a medical college to open a new or higher course of study or
training including a post-graduate course of study or training, which would enable the
students of that medical college for the award of any recognised medical qualification or
to increase its admission capacity except with the previous permission of the Central
Government obtained in accordance with the provisions of Section 13A. Sub-sections (2),
(3), (4), (5), (6), (7), (8) and (9) of Section 13A lay down the manner in which the Central
Government is to be approached for establishment of a new medical college or for
opening of a new higher course of study or increasing admission capacity and how it
would be dealt with. Section 13B postulates that where any medical college is established
or an established medical college opens a new higher course of study or training or where
any medical college increases its admission capacity in any course of study or training
without the permission of the Central Government, the medical qualification granted to
any student of such medical college or the higher course of study or training or admission
in the increased capacity in any course of study, would not be a recognized medical
qualification for the purposes of the Act. Section 13C, however, provides a breathing time
to the medical colleges which have been established on or before the commencement of
the Amending Act of 2003 without the permission of the Central Government to get such
permission within a period of three years from the commencement of the Act. Therefore,
the colleges or the institutions which have not obtained the permission of the Central
Government may do so within a period of three years from the commencement of the Act
to save the medical qualification conferred on the students of such medical colleges from
the rigour of Section 13B of the 1970 Act. However, as per sub-section (2) of Section
13C, if any person or medical college fails to seek permission within three years of
commencement of the Act, qualification granted to any student of such medical
institution shall not be a recognised medical qualification and it shall be deemed that
permission to open or start a new course or increase strength of students was refused by
the Central Government. Medical colleges opened on or before the coming into force of
the Amending Act of 2003 are necessarily required to take permission within three years
to save the recognized medical qualification of the students. On their failure, the medical
qualification conferred on the students shall come to naught. Under Section 13A, a
person who establishes a medical college or a medical college opens a new higher course
of study or increases the admission capacity is required to move an application for
permission of the Central Government. For obtaining permission as required under
Section 13A, every person or medical college is required to submit a scheme in such form
with requisite fee, containing such particulars as provided under sub-section (3) of
Section 13A. The Central Government on receipt of such application may require the
applicant to submit such other particulars as may be considered necessary. The Central
Government after considering the scheme and recommendations of the Central Council
and after obtaining such other particulars as felt necessary, may approve the scheme with
such conditions which are considered necessary. The Central Government may also
disapprove the scheme. Sub-section (6) of Section 13A provides that where within a
period of one year from the date of submission of scheme to the Central Government, no
order is communicated by the Central Government to a person or medical college, such
scheme shall be deemed to have been approved by the Central Government in the form in
which it was submitted. From the aforesaid provisions, it is apparent that an application
seeking permission for opening a medical college has to be moved by a person which
also includes the university or a trust or a medical college or those which are already
running the medical college when the Amending Act came into force. Section 13A
nowhere provides that the students who have studied in the medical
@page-SC606
colleges would be eligible to seek permission of the Central Government under that
Section. Section 13A or Section 13B or Section 13C nowhere contemplates moving of an
application by the students to take steps under Section 13A. In such a situation, the
question arises what shall happen to the degrees conferred on the students who have
studied in the medical colleges established prior to the commencement of the Amending
Act where the Governing Body or Organising Committee or any body or institution does
not take any step for seeking permission of the Central Government and the period
prescribed under Section 13C of three years has expired or where the institution has been
closed down immediately after the commencement of the Amending Act of 2003 and,
therefore, no body is interested in seeking permission of the Central Government.
23. The provisions of Sections 13A, 13B and 13C of the 1970 Act as introduced by the
Amending Act of 2003, if given retrospective operation, the medical qualification
acquired from the study in the medical colleges which have been opened prior to the
commencement of the Amending Act of 2003 and conferred medical qualification on the
students who studied in such medical colleges, the degrees so conferred in the absence of
the permission of the Central Government would be non est though there is no fault on
the part of the students who have studied in the institutions which are recognized and
affiliated to the Faculty under the 1951 Act.
24

. In our opinion, where the legislature has used words in an Act which if generally
construed, must lead to palpable injustice and consequences revolting to the mind of any
reasonable man, the court will always endeavour to place on such words a reasonable
limitation, on the ground that the legislature could not have intended such consequence to
ensue, unless the express language in the Act or binding authority prevents such
limitation being interpolated into the Act. In construing an Act, a construction ought not
be put that would work injustice, or even hardship or inconvenience, unless it is clear that
such was the intention of the legislature. It is also settled that where the language of the
legislature admits of two constructions and if construction in one way would lead to
obvious injustice, the courts act upon the view that such a result could not have been
intended, unless the intention had been manifested in express words. Out of the two
interpretations, that language of the statute should be preferred to that interpretation
which would frustrate it. It is a cardinal rule governing the interpretation of the statutes
that when the language of the legislature admits of two constructions, the court should
not adopt the construction which would lead to an absurdity or obvious injustice. It is
equally well settled that within two constructions that alternative is to be chosen which
would be consistent with the smooth working of the system which the statute purported to
be regulating and that alternative is to be rejected which will introduce uncertainty,
friction or confusion with the working of the system. [See Collector of Customs v.
Digvijaysinhji Spinning and Weaving Mills Ltd. (1962) 1 SCR 896, at page 899 and His
Holiness Kesvananda Bharati v. State of Kerala, AIR 1973 SC 1461]. AIR 1961 SC
1549

25. The court must always lean to the interpretation which is a reasonable one, and
discard the literal interpretation which does not fit in with the scheme of the Act under
consideration.
26

. In series of judgments of this Court, these exceptional situations have been provided
for. In Narashimaha Murthy v. Susheelabai, (1996) 3 SCC 644 (at page 647), it was held
that: 1996 AIR SCW 2120, Para 20

".........The purpose of law is to prevent brooding sense of injustice. It is not the words of
the law but the spirit and eternal sense of it that makes the law meaningful.............."
In the case of American Home Products Corporation v. Mac Laboratories Pvt. Ltd. and
Another, AIR 1986 SC 137 (at page 166, para 66), it was held that:
".... It is a well-known principle of interpretation of statutes that a construction should not
be put upon a statutory provision which would lead to manifest absurdity or futility,
palpable injustice, or absurd inconvenience or anomaly........."
Further, in the case of State of Punjab v. Sat Ram Das, AIR 1959 Punj. 497, the Punjab
High Court held that:
"To avoid absurdity or incongruity, grammatical and ordinary sense of the words can, in
certain circumstances, be avoided."
@page-SC607
27. The amendment brought about in the Indian Medicine Central Council Act, 1970, in
2003 by introduction of Sections 13A, 13B and 13C are the provisions for continuance of
the institution which has not obtained prior permission of the Central Government and,
therefore, time limit of three years has been provided under Section 13C to regularize the
institution's affairs as required under the Act by seeking permission of the Central
Government. Insertion of Section 13A in the 1970 Central Act in the year 2003 has
regulated the opening of an indigenous medical college. The non obstante clause clearly
indicates that a medical institution cannot be established except with the prior permission
of the Central Government. Under Section 13B, any medical qualification granted by the
colleges established without the prior permission of the Central Government is not a
recognized medical qualification. The reasonable reading of Section 13C(1) puts the
existing colleges at par with the new colleges as both of them are required to seek
permission within three years from the commencement of the Amending Act. The phrase
'on or before' has made it clear that the existing colleges are also required to seek
permission and there is no exemption. Section 13C(2) further provides that the medical
qualification granted by existing colleges whose establishment has not been recognized
by the Central Government, the medical qualification would not be a recognized
qualification. Similar requirement is to be fulfilled by the new medical colleges opened,
i.e., to seek permission of the Central Government for the medical qualification to be
recognized qualification. Thus, new colleges or existing colleges cannot any more grant a
recognized qualification without the sanction of the Central Government. Section 13C(2)
does not say that the effect of non-permission by the Central Government to the existing
colleges after the Amending Act came into force would render the medical qualifications
already granted by the existing colleges before the insertion of Sections 13A, 13B and
13C in 2003, un-recognised. The whole spectrum of the amendment brought about by
introducing Sections 13A, 13B and 13C indicates that it has an application from the date
they have been introduced by an amendment in the 1970 Central Act. The effect of the
amendment brought about is clear to us that all the medical colleges which are in
existence or the medical colleges which have to be established should compulsorily seek
permission of the Central Government within the period provided and on failure to get
the permission of the Central Government the medical qualification granted to any
student of such medical college shall not be a recognized medical qualification for the
purposes of the 1970 Act. The established colleges are also required to seek permission of
the Central Government for the medical qualification to be recognized medical
qualification but it would not mean that the already conferred medical qualification of the
students studied in such previously established medical colleges would not be a
recognised medical qualification under the 1970 Act.
28. On a reasonable construction of these Sections, we hold that the provisions of Section
13B whereby the qualification granted to any student of a medical college would not be
deemed to be a recognized medical qualification would not apply. When a degree has
been legally conferred on the students prior to the commencement of the Amending Act
of 2003, it shall be treated as a recognized degree although the medical college has not
sought permission of the Central Government within a period of three years from the
commencement of the Amending Act of 2003.
29. For the reasons aforesaid, the appeals are allowed. The judgment of the High Court is
set aside and we hold that the GAMS degree conferred on the appellant-students shall be
treated as a recognized degree for the purposes of taking admission to the higher courses
of study and also for the purposes of employment.
30. There shall be no order as to costs.
Appeals allowed.
AIR 2008 SUPREME COURT 607 "Abdul Gafur v. State of Assam"
(From : Gauhati)*
Coram : 2 Dr. A. PASAYAT AND D. K. JAIN, JJ.
Criminal Appeal No. 1675 of 2007 (arising out of SLP (Cri.) No. 6635 of 2006), D/- 6
-12 -2007.
Abdul Gafur and Ors. v. State of Assam.
Penal Code (45 of 1860), S.395, S.397 - DACOITY - EVIDENCE - FIR - Dacoity -
Appreciation of evidence - Accused neighbours of victims
@page-SC608
Telephonic message given to police by inmate of house however describing accused as
strangers - Regular FIR lodged after much delay - Allegations of rape on young girl of
victim's family - Not substantiated by any material - Animosity between accused and
informant family admitted - Prosecution case unacceptable - Accused liable to be
acquitted.
Crl. Appeal No. 201 of 1998, D/- 12-5-2006 (Gau.), Reversed. (Paras 10, 11)

H. L. Agrawal, Sr. Advocate, Azim H. Laskar, Anand, Abhijit Sengupta, for Appellants;
Avijit Roy (for M/s. Corporate Law Group), for Respondent.
* Cri. Appeal No. 201 of 1998, 12-5-2006 (Gau.).
Judgement
1. Dr. ARIJIT PASAYAT, J. :- Leave granted.
2. Challenge in this appeal is to the order passed by a learned Single Judge of the Gauhati
High Court dismissing the appeal filed by the appellant.
3. Background facts according to the prosecution in a nutshell are as follows:
On the night of 11.4.88 at about 6.30 P.M. the accused Abdul Gafur, Hokoi Mian, Najir
Ali, Sayed Ali, Latif Ali, Aklas Mian, Ashu Mian and Tabai Mian being armed with
deadly weapons namely, dao, lathis, dagger etc. surrounded the house of Satyendra Nath
Gupta at village Brahrnanshashan, assaulted him, his wife Smt. Hemamalini Gupta, his
son Subhendu Gupta, his eldest daughter Anjali Gupta and his relatives Sushil Chanda
causing grievous injuries to them, tied them up and then looted gold ornaments, namely,
chains, bangles, ear rings etc. valued at Rs.42,950.00 from the possession of the female
inmates of the house, namely, Hemamalini Gupta, Anjali Gupta, Mitra Gupta, Rubi Gupta
and Nell Gupta. That apart two of the accused persons, namely, Hokoi Mian and Aklas
Uddin committed rape respectively on Mitra Gupta and Rubi Gupta and decamped with
the looted booties. During the course of occurrence Sushil Chandra Gupta the son of
Satyendra Nath Gupta informed police over telephone that decoity was being committed
in the house of Satyendra Nath Gupta and that Satyendra Nath Gupta and his wife were
assaulted by the decoits causing grievous injuries to them. At the Nilambazar out post a
general diary vide entry No.212 at 8.15 p.m. on the night of 11.4.1988 was recorded and
on the basis of such information enquiry was launched. Thereafter Satyendra Nath Gupta
also lodged a written Ejahar with police of Nilambazar out post. The Officer Incharge of
Nilambazar out post sent the written ejahar to the Officer Incharge of Karimganj P.S.
whereupon the Officer Incharge of Karimganj P.S. registered a case under Section
395/397/376 of the Indian Penal Code, 1860 (in short the 'IPC'). S.I. of police T.C.
Bailong after completion of enquiry/investigation submitted charge sheet against the
accused Abdul Gafur, Hokoi Mian, Boloi Mian, Sayed Ali, Aklas Uddin, Najir Ali, Latif
Ali, Ashu Mian and Tabai Mian for alleged commission of offences punishable under
Sections 395 and 397 IPC.
The charges against the accused Najir Ali, Ashu Mian and Tabai Mian were proven and
they were declared to be proclaimed absconders. The case against other six accused
persons, namely Abdul Gafur, Hokoi Mian, Boloi Mian, Sayed Ali, Alas Uddin and Latif
Ali was committed to the Court of Session by learned Judicial Magistrate, 1st Class,
Karimganj.
4. During trial nine witnesses were examined to further the prosecution version.
5. Placing reliance on the evidence of witnesses-PWs. 1, 2, 3, 5 and 8, the trial court
found that accused appellant 1,2,3,5and6 guilty of offence punishable under Section 395
read with Section 397 IPC and accused appellant Nos. 3 and 5 were guilty of offence
punishable under Section 354 IPC. For the offence relatable to Section 395 read with
Section 397, each was sentenced to undergo rigorous imprisonment for seven years and
to pay a fine of Rs.2,000/- with default stipulation. For the offence relatable to Section
354 IPC they were sentenced to rigorous imprisonment of one year each.
6. The convicted accused persons preferred an appeal before the High Court. As afore-
stated the High Court dismissed the appeal and affirmed the conviction and sentence.
7. In support of the appeal learned counsel for the appellant submitted that the High Court
has disposed of the appeal cryptically without even discussing the various submissions
made. There are also several infirmities in the conclusions arrived at.
8. Learned counsel for the respondent-State on the other hand supported the judgment of
the trial court and the High Court.
@page-SC609
9. The High Court has noted as if a telephonic message was given by a stranger regarding
decoity. However, in evidence it has given that the information was given not by a
stranger but by Sushil Chandra Gupta, PW 1. In the information given it was stated that
some stranger had committed dacoity.
10. The accused persons are not strangers and were practically neighbours of the
informant and his family. The High Court noted that there was no intention to falsely
implicate accused persons because of enmity and there was no reason as to why dignity
of two young girls would be put at stake by alleging rape. It is to be noted that in fact
rape was alleged but the Trial Court found that there was no material to substantiate the
plea of rape. The evidence is totally inconsistent and lacks credence. The High Court's
observations were clearly based on surmises and contrary to the factual scenario. The
High Court has noted that the evidence of PWs. 1,2,3,5 and 8 stand fully corroborated by
the medical evidence. Significantly, on consideration of the evidence of PW 4, it is clear
that the evidence of this witness is clearly contrary to the medical evidence. To add to the
confusion, it is noted that the High Court recorded as finding that appellant Abdul Gafur
was absconding. As a matter of fact the evidence of Investigating Officer (in short the
'I.O') shows that he had arrested Abdul Gafur on the date the First Information Report (in
short the 'FIR') was lodged. Unfortunately the High Court has merely referred to certain
conclusions of the Trial court without analyzing the evidence and various submissions
made by the appellants. To add to the vulnerability of the prosecution version, the FIR
was lodged long after the incident and in fact law was already set on motion after the
telephonic message had been received.
11. The aforesaid infirmities in the background of admitted animosity between the parties
renders the prosecution version unacceptable. The Trial Court and the High Court did not
analyse the evidence correctly and acted on mere surmises and conjectures. That being
so, the appellants deserve to be acquitted, which we direct.
12. Appeal is allowed. The appellants are acquitted of the charges. They be set forth at
liberty if not required in any other case.
Appeal allowed.
AIR 2008 SUPREME COURT 609 "State of Punjab v. Raninder Singh"
(From : Punjab and Haryana)
Coram : 2 A. K. MATHUR AND MARKANDEY KATJU, JJ.
Criminal Appeal Nos. 1608 with 1607 of 2007 (@ out of SLP (Cri.) Nos. 3433 with 3514
of 2007), D/- 19 -11 -2007.
State of Punjab v. Raninder Singh and Anr.
WITH
State of Punjab v. Jagjit Singh.
(A) Criminal P.C. (2 of 1974), S.378 - ANTICIPATORY BAIL - APPEARANCE -
INTERROGATION - Anticipatory bail - Condition that accused must appear before
investigating officer for interrogation when required Breach of - Bail can be cancelled.
(Para 5)
(B) Contempt of Courts Act (70 of 1971), S.2(c), S.14 - CONTEMPT OF COURT -
POLICE OFFICERS - HIGH COURT - Contempt of Court - Use of improper language
-Police Officer using loose expressions in his affidavit and application - Held, though was
not contempt, language used should have been in consonance with dignity of Court and
facts stated should be correct - Notice for contempt issued by High Court liable to be set
aside. (Para 9)

K. K. Khurana, A. A. G., K. K. Venugopal, Ashwani Kumar Mata, Ravi Shankar Prasad,


U. U. Lalit, L. N. Rao, Sr. Advocates, Kuldip Singh, Ajay Pal, Vaibhav Dang, Amrendra
Kumar Mehta, Mrs. Rashi Khurana, Atul Nanda, Rajesh Kumar, Sandeep Bajaj (for M/s.
Law Associates and Co.), Arun Monga, Ms. Rameeza and Ms. Naresh Bakshi, with them
for the appearing parties.
Criminal Appeal No. 1608 of 2007 @ Slp (Crl.)) No. 3433 of 2007
Judgement
JUDGMENT:-We have heard learned counsel for the parties.
2. Leave granted.
3. We have perused the impugned order dated 24th May, 2007 granting anticipatory bail
passed by the learned single Judge of the Punjab and Haryana High Court in Crl. Misc.
No. 33867-M of 2007. After hearing learned counsel for the parties, we are of the opinion
that no interference is called for by this Court. The appeal is accordingly, dismissed.
4. However, we make it clear that in case the respondents do not cooperate with the
investigation, then it is always open for the
@page-SC610
State to move an application before the High Court for cancellation of the bail, which will
be decided in accordance with law.
5. It may be mentioned here that Section 438 (2)(i) of the Code of Criminal Procedure is
very clear that while granting anticipatory bail the Court can lay down a condition that
the accused shall make himself available for interrogation by a police officer as and when
required. The purpose of such a provision is that anticipatory bail cannot be permitted to
be abused. It is therefore, implicit that whenever the Court imposes such a condition in its
order, and the accused called for interrogation or for certain investigation does not appear
before the investigating officer then it will be open for the State to move the High Court
for cancellation of bail.
6. We make it clear that this order is confined only to the F. I. R. in the present case.
Criminal Appeal No. 1607/2007 @ SLP (Crl.) No. 3514/2007
7. We have heard learned counsel for the parties.
8. Leave granted.
9. This appeal by special leave is directed against the orders dated 15-5-2007 and 31-5-
2007 passed by the learned single Judge of the Punjab and Haryana High Court in Crl.
Misc. No. 27116-M of 2007 and CRM No. 36313 of 2007 whereby a contempt notice
was issued to the Senior Superintendent of Police, Vigilance Bureau, Ludhiana who has
sworn the affidavit along with the application. Normally the Courts should not be
oversensitive and should not take very serious note of any loose expressions in the
application. Contempt jurisdiction is to be sparingly exercised in very exceptional cases,
as one of us (Markandey Katju, J.) has observed in an article 'Contempt of Court : The
Need for a Fresh Look' published in the Journal Section of AIR 2007 (March Part), and
we agree with the views expressed therein. However, the applicant should use proper
language and state correct facts in his application. Although it is not contempt, proper
decorum should be maintained. Be that as it may, we are of the opinion that the learned
Judge should not have issued contempt notice in the matter. The S. S. P. had sworn the
affidavit but the counsel who has prepared the application should have been more careful
while drafting such an application. They should not make incorrect statements. The
language used by them should be in consonance with the dignity of the Court.
10. Having regard to the facts and circumstances of the case, we do not think it to be a
proper case where contempt notice ought to have been issued.
11. In the facts and circumstances of the case, while maintaining the order dated 15-5-
2007 we set aside the direction in the last paragraph of the learned single Judge's Order
dated 31st May, 2007 issuing notice to the S. S. P., Vigilance Bureau, Ludhiana.
12. The appeal is accordingly, disposed of.
Order accordingly.
AIR 2008 SUPREME COURT 610 "Shaik China Brahamam v. State of A. P."
(From : Andhra Pradesh)*
Coram : 2 G. P. MATHUR AND D. K. JAIN, JJ.
Criminal Appeal No. 927 of 2006, D/- 29 -11 -2007.
Shaik China Brahamam v. State of A. P.
(A) Penal Code (45 of 1860), S.300 - MURDER - WITNESS - Murder - Proof - Accused
with one other alleged to have assaulted deceased with multiple knife injuries resulting in
death - Exchange of hot words between accused and deceased two days prior to incident
over borrowing of money - Proves motive - Eye-witness not inimical towards accused -
His narration of incident corroborated by medical evidence - Accused and co-accused
liable to be convicted for murder. (Para 11)
(B) Penal Code (45 of 1860), S.34, S.300 - MURDER - COMMON INTENTION -
EVIDENCE - PLEA - Common intention - Murder case - Accused armed with knife and
appellant armed with iron rod going together and assaulting deceased - Medical evidence
showing that knife injuries were fatal - Plea by appellant that he has not caused any fatal
injury - Could not, therefore, be convicted for murder with aid of S. 34 - Not tenable -
When criminal act is done with common intention all are liable in some manner as
principal offender - Moreso, in instant case appellant had played an active role. (Para
12)

I. V. Narayana, Sr. Advocate, T. N. Rao,


@page-SC611
Ms. Manjeet Kirpal and Paramjeet Singh, with him for Appellant; Ms. Altaf Fathima and
Ms. D. Bharathi Reddy, for Respondent.
* Cri. A. No. 116 of 2004, D/- 2-3-2006 (A.P.)
Judgement
1. G. P. MATHUR, J. :- This appeal under Section 2 of the Supreme Court (Enlargement
of Criminal Appellate Jurisdiction) Act, 1970 has been preferred against the judgment
and order dated 2.3.2006 of Andhra Pradesh High Court, by which the appeal filed by the
State was allowed and the judgment and order dated 24.9.2002 of the learned Sessions
Judge, Guntur acquitting the two accused in Sessions Case No.466 of 2000 was set aside.
The High Court by the impugned judgment and order convicted both the accused Shaik
Khasim Saida (A-1) and Shaik China Brahmam (A?2) under Section 302 read with
Section 34 IPC and sentenced them to imprisonment for life and a fine of Rs.200/- each.
2. The case of the prosecution, in brief, is that Shaik Khasim Saida (A-1) had borrowed
Rs.300/- from the deceased Shaik Masthan Vali some time back, but he did not repay the
amount due to which their relations became strained. At about 4.00 p.m. on 6.4.1999, the
deceased Shaik Masthan Vali and his cousin Shaik Baba Vali (PW.1) were returning to the
village from northern side of Chandravanka rivulet after attending the call of nature. Both
the accused suddenly appeared on the spot. A-1 stabbed the deceased Shaik Masthan Vali
repeatedly with a knife which he has carrying and A-2 caused injuries to the deceased
with iron pipe. After receiving injuries the deceased fell down dead on the spot. PW.1
Shaik Baba Vali lodged an FIR at P.S. Macherla at 6.30 p.m. on the same day. On the
basis of the FIR a crime was registered as Case Crime No.55 of 1999 under Section 302
read with Section 34 IPC at the police station.
3. After the case had been registered at the police station, PW.8 K. Babu Rao, Inspector of
Police, P.S. Macherla commenced investigation of the case. He arrested A-1 and A-2 and
went to the scene of occurrence and prepared a site plan. After recording statement of
witnesses, he submitted charge-sheet against both the accused A-1 and A-2. The
prosecution in order to establish its case examined nine witnesses and filed some
documentary evidence. The learned Sessions Judge, Guntur, by the judgment and order
dated 24.9.2002 acquitted both the accused A-1 and A-2. Feeling aggrieved by the order
of the learned Sessions Judge, the State filed appeal in the High Court, which was
allowed and accused were convicted under Section 302 read with Section 34 IPC and
were sentenced to imprisonment for life and a fine of Rs.200/- each. The present appeal
has been filed only by Shaik China Brahmam (A-2). It appears that Shaik Khasim Saida
(A-1) has not preferred any appeal against his conviction and sentence.
4. We have heard Mr. I.V. Narayana, learned counsel for the appellant and Ms. Altaf
Fathima, learned counsel for the State of Andhra Pradesh and have perused the record.
5. The case basically rests on the testimony of PW.1 Shaik Baba Vali. He has deposed that
his house is situate near Chennakesava Swamy Temple in Macherla and both the accused
viz. A-1 and A-2 are also residents of the same place. The deceased Shaik Masthan Vali
was also resident of Macherla. The deceased had informed him that A-1 had borrowed
money from him and had not returned the same and due to this their relations had become
strained. At about 4.00 p.m. on 6.4.1999, he and deceased Shaik Masthan Vali had gone
to the field by the side of Chandravanka rivulet for answering the call of nature.
Thereafter, they were returning home and the deceased was little behind him. Suddenly
he saw that A-1 had caught hold of the deceased by putting his arm around his neck and
then he started giving him repeated blows by a knife. A-2 also assaulted the deceased
with an iron pipe. The deceased raised an alarm. When PW.1 tried to save the deceased,
both the accused threatened him that they would also assault him. The deceased Shaik
Masthan Vali snatched the knife from the hands of A-1, but A-1 again snatched back the
knife from the deceased and gave him several blows. In the process of snatching the
knife, the hands of A-1 also got cut injuries. PW.1 then went to the house of the deceased
Shaik Masthan Vali and informed his wife and other relations about the incident.
Thereafter, he went to P.S. Macherla and presented a written report. He got the report
scribed by a person who was sitting outside the police station. He identified the knife
M.O. 1 and the iron pipe M.O. 2, which were shown to him in Court. He also identified
the clothes, which the deceased was wearing viz. M.O. 3 the blood
@page-SC612
stained shirt, M.O. 4 the blood stained banian, M.O. 5 the blood stained dhoti, M.O. 6 the
chappal which the deceased was wearing and M.O. 7 the towel which the deceased was
having on his body. In his cross-examination, he has stated that his house and that of the
deceased were situate in the same ward and in side-by-side streets. The accused A-1 and
A-2 were staying in a parallel streets. The distance between the house of the deceased and
the police station is about 3 furlongs. He clarified that M.O. 2 is an iron pipe.
6. PW.2 Sk. Masthan Bee is the wife of the deceased Shaik Masthan Vali. She deposed
that her house is by the side of Chennakesava Swamy Temple in Macherla and the house
of PW.1 Shaik Baba Vali was near her house and the houses of the accused were situate at
some distance. She further deposed that PW.1 Shaik Baba Vali came to her house and
informed that A-1 and A-2 had killed her husband. There was some dispute between her
husband and the accused on account of borrowing of Rs.300/- and two days prior to the
incident an altercation had taken place between them at the tea stall of Achari, which she
had also seen. At that time A-1 had said loudly that he would kill her husband. After
learning about the incident from PW.1 she rushed to the scene of occurrence and saw the
dead body of her husband lying there. She denied the defence suggestion that A-1 had not
loudly said two days back that he would kill her husband or that PW.1 had not informed
her that A-1 and A-2 had killed her husband.
7. PW.5 Dr. P. Rajasekhara Reddy was working as Civil Assistant Surgeon in Community
Health Centre, Macherla from October 1997 to 4.1.2001. He conducted postmortem
examination over the body of Shaik Masthan Vali from 11.00 a.m. onwards on 7.4.1999
and found the following injuries on the same :-
"1. A cut injury over the anterior aspect of neck, cutting the trachea and carotids, 14 cm x
5 cm.
2. A cut injury over the right temple, 3 cm x 1 cm, dark brown in colour.
3. A cut injury over the nape, 10 cm x 4 cm.
4. Two cut injuries over the occipital area, each 3 cm x 1 cm side by side.
5. Another cut injury over the occipital area, 2" above the wound No.4 semi circle, 7 cm x
3 cm, exposing the brain matters.
6. A cut injury over the left parietal area above the left ear, 3 cm x 1 cm.
7. A cut injury behind the left ear, 4 cm x 1 cm.
8. A cut injury below the left ear, 2 cm x 1 cm.
9. A cut injury on the right ear, 5 cm in length.
10. A cut injury on the right thumb 2 cm x 2 mm.
11. A cut injury on the right little finger, 1 cm x 2 mm.
12. A cut injury over the right wrist on flexor side, 4 cm x 2 cm.
13. A cut injury over the right scapular area, 2 cm x ½ cm.
14. A contusion over the left scapular area, 3 cm in diameter, brown in colour.
15. A contusion on the right axilla, 4 cm x 1 cm, brown in colour.
16. A cut injury over the left thumb, circling the both surfaces, 3 cm x 1 mm.
17. Two small cut injuries on the left index finger, each 1 cm x 1 mm 1 cm apart.
18. A contusion on the left forearm 3 cm x 4 cm.
19. Scrotum was swollen.
20. On opening the body all viscera are normal and pale.
Patient died about 18 to 22 hours prior to postmortem examination."
In the opinion of the doctor, the deceased had died on account of shock and haemorrhage
due to multiple injuries and cardio-pulmonary arrest. Injury No.1 caused on the anterior
aspect of the neck cutting the trachea and carotids and injury No.5 i.e. the injury on the
occipital area were fatal. He further opined that injury No.1 and injury No.5 were
sufficient to cause instantaneous death.
8. PW.9 Dr. S. Sakunthala was Civil Assistant Surgeon at Government Hospital,
Macherla. She examined Shaik Khasim Saida (A-1) at 7.55 p.m. on 6.4.1999 and found
the following injuries on his body :
"1. Incised wound 4 x ½ cm, over right palm, bleeding present, red.
2. Incised wound 3 x ½ cm, over right palm, 1 cm. below No. 1 injury, bleeding present,
red.
@page-SC613
3. Incised wound ½ x ¼ cm, over left index, ring, middle, little fingers except thumb,
over palm inner side, red."
In the opinion of the doctor, the injuries were simple in nature and were caused due to a
sharp object. The duration of injuries was 3 to 4 hours.
9. On the same day, i.e., on 6.4.1999 at 7.30 p.m. PW.9 Dr. S. Sakunthala also examined
Shaik China Brahmam (A-2) and found the following injuries on his body :-
"Incised wound 1 cm x ¼ cm over right index finger, over palm side."
The doctor opined that the injury was simple in nature and was caused due to a sharp
object. The duration of injury was 3 to 4 hours.
10. PW.7 T.A. Rambabu was Head Constable, P.S. Macherla. He has deposed that on
6.4.1999, when he was attending to his duties in the police station, he received
information that a murder had taken place near Chandravanka Vagu (rivulet). He went to
the office of Inspector of Police and informed him about the same. At about 6.30 p.m.
PW.1 Shaik Baba Vali came to the police station and presented a written report Ex.P1. He
registered the same as Case Crime No.55 of 1999 under Section 302 IPC and sent copies
of the FIR to all concerned. Thereafter, the Police Inspector came to the police station at
6.40 p.m. along with two persons who were having injuries on their hands. He sent them
for medical examination. PW.8, K. Babu Rao was Inspector of Police, P.S. Macherla. He
deposed that about 5.30 p.m. on 6.4.1999, he heard a rumour that a murder had taken
place near Chandravanka Vagu. He immediately left for the scene of occurrence along
with some police personnel which was between Macherla and Jammalamadaka near the
field of one Pathu Sahab and saw a dead body there. He also received information about
the presence of the accused near Jasmine Garden. He proceeded there with his staff. He
saw A-1 and A-2 and arrested them. They had injuries on their hands. They were taken to
the police station from where they were sent for medical examination. As it had become
dark, he did not conduct any further investigation which he commenced on the next day
at 7.00 a.m. He prepared a site plan. He also seized the knife M.O. 1 and the iron pipe
M.O.2. He also seized M.O. 6 and M.O. 7 belonging to the deceased. He held inquest
over the body of the deceased at 8.00 a.m. After recording statements of the witnesses
under Section 161 Cr.P.C. and preparing other relevant papers, he submitted charge-sheet
against the two accused viz. A-1 and A-2.
11. We have given above the gist of the evidence adduced by the prosecution. The
testimony of PW.2, Sk. Masthan Bee wife of deceased Shaik Masthan Vali establishes
that there was dispute regarding borrowing of Rs.300/- between A-1 and the deceased.
Two days prior to the occurrence, exchange of hot words had taken place between them
at the tea stall of Achari, where A-2 was also present and at that time A-1 had declared
that he would kill the deceased Shaik Masthan Vali. This shows that there was motive on
the part of the accused to assault the deceased. PW.1 Shaik Baba Vali had deposed that at
about 4.00 p.m. on 6.4.1999 he had gone along with deceased across Chandravanka Vagu
for answering the call of nature. While returning A-1 armed with knife and A-2 armed
with rod started assaulting the deceased Shaik Masthan Vali. He has also deposed that the
deceased had snatched the knife from A-1, but A-1 snatched it back and again caused
injuries from the same to the deceased. P.W.1 gave immediate information about the
occurrence to the family members including the wife of the deceased, P.W. 2 Sk. Masthan
Bee, which is established from her testimony. The most important feature of the case is
that P.W. 8K. Babu Rao, Inspector of P.S. Macherla, received information at about 5.30
p.m. that a murder had taken place near Chandravanka Vagu. He left for the scene of
occurrence and found the dead body there. He also received information about the
presence of the accused near Jasmine Garden and arrested them at about 6.40 p.m. Both
the accused were sent for medical examination and three incised wounds were found on
the right and left palm of A-1 and one incised wound was found on the right palm of A-2.
The injuries on the palm of A-1 and A-2 completely corroborate the version given by
P.W.1 Shaik Baba Vali that the deceased had snatched the knife from the hands of A-1,
but accused again snatched it back. The multiple injuries found on the body of the
deceased, which are mostly cut injuries besides contusions, also corroborate the eye-
witness account given by P.W.1 Shaik Baba Vali. It may be
@page-SC614
mentioned here that there is no evidence on record to show that there was any enmity
between P.W.1 Shaik Baba Vali and the accused, on account of which he may falsely
implicate them. In fact, the defence has given no suggestion in his cross-examination that
he had any reason to falsely implicate the accused. Thus, from the evidence on record, the
case of the prosecution is fully established. The High Court, therefore, rightly convicted
both the accused. The learned Sessions Judge had committed manifest error of law in
giving too much weight to some minor and insignificant contradictions. The learned
Sessions Judge had also given undue importance to the timings deposed to by P.W.1 in
going from the place of occurrence to the house of the deceased, then going from there to
the police station and getting the FIR scribed. He is not a highly educated person and he
was not expected to have a very accurate idea of timings. The learned Sessions Judge
disbelieved the prosecution case on grounds which were not even worth taking notice of
and were completely divorced from reality. The view taken by the learned Sessions Judge
being wholly perverse, was rightly set aside by the High Court and it was perfectly
justified in convicting both the accused A-1 and A-2.
12. Learned counsel for the appellant has next submitted that the appellant herein viz.
Shaik China Brahmam (A-2) cannot be held liable under section 302 read with Section
34, IPC as the main injuries were given by Shaik Khasim Saida (A-1), who was armed
with a knife and he was responsible for injuries to trachea and occipital region which
proved fatal. He has submitted that the appellant-Shaik China Brahmam (A-2) was armed
with an iron pipe and he did not cause any fatal injury. We are unable to accept the
submission made. It has come in evidence that the pipe with which A-2 was armed was in
the shape of an iron rod and iron rod can also cause fatal injuries. When a criminal act is
done by several persons in furtherance of common intention of all, the other offenders are
liable for that act in the same manner as the principal offender as if the act was done by
such offenders also. In this case, both the accused went jointly to a place where the
deceased had gone for attending the call of nature and they jointly assaulted him. The fact
that A-2 also received injuries in his palm shows that he took active part in snatching the
knife from the hands of the deceased when he had succeeded in snatching it from A-1.
This clearly shows that A-2 shared the common intention with A-1 to cause injuries to the
deceased. The essential conditions for the application of Section 34, IPC are common
intention to commit an offence and participation by all the accused in doing act or acts in
furtherance of that common intention. If these two ingredients are established, all the
accused shall be liable for the said offence. We have no doubt that in the present case
both the ingredients are fully established and, therefore, A-2 is also liable for commission
of the offence. We are, therefore, clearly of the opinion that A-2 is guilty of the offence
under Section 302 read with Section 34, IPC and the High Court rightly convicted and
sentenced him for the said offence.
13. In the result, the appeal fails and is hereby dismissed.
Appeal dismissed.
AIR 2008 SUPREME COURT 614 "New India Assurance Co. Ltd. v. Prabhu Lal"
Coram : 2 C. K. THAKKER AND TARUN CHATTERJEE, JJ.
Civil Appeal Nos. 5539 with 5540-5541 of 2007* (arising out of SLP (C) Nos. 7370,
17794 of 2004, 7618 of 2005), D/- 30 -11 -2007.
New India Assurance Co. Ltd. v. Prabhu Lal.
Motor Vehicles Act (59 of 1988), S.147, S.2(47), S.3 - MOTOR VEHICLES -
INSURANCE - LICENSE - Liability of insurer - Defence of validity of driver's licence -
Vehicle involved in accident driven by driver holding L. M. V. licence - No endorsement
on licence to drive transport vehicle - Permit issued by Transport Authority clearly
showing that vehicle in question was a 'transport vehicle' - Yet holding vehicle to be L.
M. V. on basis of unladen weight and fact that it was not carrying goods at relevant time -
And saddling liability on insurance company - Improper. (Paras 23, 24, 28, 29, 42)
Cases Referred : Chronological Paras
2006 AIR SCW 1649 : AIR 2006 SC 3440 : 2006 (2) AIR Jhar R 662 : 2006 (3) AIR Kar
R 215 35
@page-SC615

2004 AIR SCW 663 : AIR 2004 SC 1531 (Disting.) 41


2003 AIR SCW 3739 : AIR 2003 SC 4161 40
AIR 2000 HP 91 (Approved) 36
1999 AIR SCW 3142 : AIR 1999 SC 3181 (Disting.) 9, 10, 14, 15, 23, 24, 30, 31,
32, 33, 36
1996 AIR SCW 2466 : AIR 1996 SC 2054 (Disting.) 39
AIR 1987 SC 1184 (Disting.) 37, 38
Kishore Rawat and M. K. Dua, for Appellant; Sangram Singh Solanki, Pankaj Kumar
Singh, J. P. N. Gupta, K. L. Janjani, Jagjit Singh Chhabra, Shekhar G. Devasa, B. V. Pinto
and D. K. Garg, for Respondent.
* From Judgment of National Consumer Disputes Redressal Commission, New Delhi in
Revn. Petn. No. 880 of 2002, D/- 17-10-2003.
Judgement
1. C. K. THAKKER, J. :-Leave granted.
2. In all these appeals, a common question of law has been raised by the parties. It is,
therefore, appropriate if we deal with and decide all the appeals by a common judgment.
In all the three appeals, the claim of the claimant has been upheld finally by the National
Consumer Disputes Redressal Commission, New Delhi ('National Commission' for short)
which has been challenged by the Insurance Company in this Court.
3. To appreciate the controversy, it would be appropriate if we narrate the facts in the first
case i.e. New India Assurance Co. Ltd. v. Prabhu Lal.
4. A complaint was filed by the complainant Prabhu Lal under Section 12 of the
Consumer Protection Act, 1986 before the District Consumer Disputes Redressal Forum,
Kota (Rajasthan) ('District Forum' for short) claiming compensation from the respondent-
Insurance Company as also from Tata Finance Limited, Jaipur. The case of the
complainant was that he purchased a vehicle-Tata 709 with Registration No. RJ-20G-
2828 from Tata Finance Limited, Jaipur. The insurance was taken from New India
Assurance Company effective from October 17, 1997 to October 16, 1998. Premium
amount of Rs.8235/- was duly paid. It was the case of the complainant that on April 17,
1998, the vehicle of the complainant was being driven by Mohd. Julfikar to Indore for
getting Chilly. At about 4.30 a.m. in the early morning, the driver of Roadways Bus No.
MP 13-C-3935 drove the bus with very high speed in rash and negligent manner which
resulted in an accident at Yashwant Nagar. Due to said accident, Ram Narain-brother of
the complainant who was sitting with Mohd. Julfikar, sustained injuries. Mohd. Julfikar
immediately ran away leaving the vehicle but as Ram Narain received serious injuries, he
could not come out of the vehicle. The complainant lodged First Information Report
(FIR) No. 131 of 1998 with the Manpur Police Station, Yashwant Nagar, District Indore
under Sections 279 and 337 of the Indian Penal Code (IPC) against driver Kalu of M.P.
Roadways Bus. Vehicle of the complainant was then inspected by Tatas, estimate was
prepared and claim was submitted in the prescribed form by the complainant to the
Insurance Company on June 12, 1998. The amount of the claim was, however, not paid to
the complainant. The complainant, therefore, moved the District Forum praying for an
award of Rs. - 4,70,000/? towards the claim of vehicle, Rs.15,000/- towards mental
agony, Rs. - 5,000/- towards driving charges of the vehicle from Indore to Kota and Rs. -
25,000/- for survey fee.
5. The Insurance Company filed its reply refuting the claim of the complainant.
According to the Company, it had not committed any deficiency in rendering 'service'. It
was also the case of the Company that it had fulfilled all contractual obligations as to
claim. The Company informed the complainant about its decision on December 21, 1999
stating that the claim was not allowable and the amount was not payable. The Insurance
Company, therefore, prayed for the dismissal of the complaint.
6. According to the District Forum, the main question was whether the Insurance
Company was deficient in rendering service and wrongly disallowed insurance claim of
the complainant. The Forum considered the question and heard the parties. According to
the complainant, at the time of accident, vehicle was driven by Mohd. Julfikar who was
having a licence to drive Light Motor Vehicle (LMV) as also Heavy Motor Vehicle
(HMV). In spite of it, the Insurance Company disallowed the insurance claim of the
complainant on the ground that the driver was not having valid driving licence to drive
the vehicle in question. It was also the contention of the complainant that certain
documents produced by the Insurance Company were not genuine. The complainant was
not an educated man and he knew only how to sign. If the officials of Insurance Company
had obtained signatures of the complainant on certain documents without reading over
@page-SC616
to him and making him properly understood, the complainant should not suffer.
According to the complainant, Insurance Company wrongly presumed and proceeded on
the basis that the vehicle was driven by Ram Narain at the time of accident, who was
having a valid driving licence to drive only Light Motor Vehicle and negatived the claim.
It was, therefore, prayed that an award be passed in favour of the complainant.
7. The case of the Insurance Company, on the other hand, was that the vehicle in
question, at the time of accident, was driven by Ram Narain, brother of the complainant.
Admittedly, Ram Narain was possessing licence to drive Light Motor Vehicle and not
Heavy Motor Vehicle. He, therefore, could not have driven Transport Vehicle in absence
of necessary endorsement as required and the Insurance Company could not be held
liable. In this connection, Insurance Company relied on the permit issued by Transport
Authority, the Form submitted by the complainant, licence issued and other documents.
The Insurance Company also relied upon FIR filed at Police Station, Manpur, wherein it
was stated that the vehicle was driven by Ram Narain. Moreover, when the officers of the
Insurance Company approached the complainant, they were informed by the complainant
that the vehicle was driven by Ram Narain. As an afterthought, only with a view to get
the amount of compensation, it was asserted and a case had been put forward before the
Consumer Forum that the vehicle was driven by Mohd. Julfikar. It was contended that the
complainant realized belatedly that if true facts would be placed before the Forum, in
view of legal position, he would not be able to get any amount from the Insurance
Company. It was, therefore, asserted that Mohd. Julfikar was driving the vehicle but it
was not true. The Insurance Company, hence, submitted that there was no deficiency in
rendering service by the Company and the claim was liable to be dismissed.
8. The Tata Finance Limited, Jaipur in its reply stated that the complainant had purchased
the vehicle on the basis of Hire-Purchase Agreement and the amount was to be paid in
instalments. At the time of incident, Rs. 3,65,026/- were due and payable to the Company.
Until the full amount was paid, the Financer was to remain owner of the vehicle. It was
also stated that though Tata Finance Company requested the Insurance Company several
times to make payment of the balance hire-purchase amount, it was not done.
9
. The District Forum, after considering the rival contentions of the parties and referring to
the case law on the point, particularly a decision of this Court in Ashok Gangadhar
Maratha v. Oriental Insurance Co. Ltd., (1999) 6 SCC 620, held that the complainant was
not entitled to compensation. According to the District Forum, in Ashok Gangadhar, this
Court held that if the driver was having effective driving licence to ply Light Motor
Vehicle (LMV), he could not have plied Heavy Motor Vehicle (HMV) or Transport
Vehicle. The District Forum observed that from the evidence on record, it was proved that
at the time of accident, Ram Narain was plying the vehicle in question and not Mohd.
Julfikar as asserted. Ram Narain was having valid and effective driving licence to ply
Light Motor Vehicle and as such he could not have plied the transport vehicle. The claim
was, therefore, not tenable and accordingly the complaint was dismissed. 1999 AIR
SCW 3142

10. Being aggrieved by the order passed by the District Forum, the claimant approached
the Consumer Disputes Redressal Commission of Rajasthan, Jaipur ('State Commission'
for short). The State Commission held that the principle laid down in Ashok Gangadhar
would apply. But according to the State Commission, the District Forum was not right in
dismissing the claim observing that the said decision was against the complainant. In fact,
the point was decided in favour of the complainant and the complainant-claimant would
be entitled to the benefit of the judgment and the Insurance Company must be held liable.
Accordingly, the appeal was allowed. The order passed by the District Forum was set
aside and the Insurance Company was ordered to pay the amount mentioned in the
operative part of the judgment along with interest at the rate of 15% p.a.
11. Aggrieved Insurance Company approached National Forum against the order passed
by the State Commission but the National Commission also dismissed the Revision and
confirmed the order passed by the State Commission. It is this order which is challenged
in this Court.
12. On April 23, 2004, notice was issued
@page-SC617
by the Court. It appears that meanwhile in other matters, a similar question came up
before this Court and hence all the matters were ordered to be placed for hearing together.
13. We have heard learned counsel for the parties.
14

. The learned counsel for the appellant-Insurance Company contended that the State
Forum as well as National Forum had committed an error of law in holding the appellant-
Insurance Company liable and directing it to pay compensation. It was submitted that
there was no deficiency on the part of the appellant-Company in rendering service to the
complainant and hence Consumer Forum had no jurisdiction to entertain, deal with and
decide the dispute. It was also submitted that it was clearly established from the relevant
documents on record that at the time of accident, Ram Narain was plying the vehicle and
not Mohd. Julfikar. Admittedly, Ram Narain was having valid driving licence to ply Light
Motor Vehicle. The vehicle in question was a transport vehicle and hence it could not
have been plied by Ram Narain. In absence of valid licence to drive the said vehicle, the
complainant could not claim compensation from the Insurance Company and no direction
could be issued to the Company to pay compensation to the complainant. The District
Forum was, therefore, fully justified in dismissing complaint of the respondent-
complainant and both, State Commission as well as National Commission - were in error
in granting the prayer of the complainant and the orders passed by them are liable to be
set aside. It was also submitted by the learned counsel that State Commission as also
National Commission, misunderstood Ashok Gangadhar. It is no doubt true that in Ashok
Gangadhar, the claim of the complainant was upheld by this Court. But it was because the
relevant documentary evidence was not placed before the Authorities. This Court,
therefore, held that since material documents were not produced by the Company, the
complainant should not suffer and in absence of such evidence, the Insurance Company
cannot be absolved of liability. But the ratio laid down in Ashok Gangadhar supports the
case of the Insurance Company that if necessary documents are on record and they go to
show that the licence issued in favour of the driver to ply a particular type of vehicle, he
could not have plied other vehicle and the Insurance Company could not be held liable if
there was breach of that condition. In the case on hand, all the documents were on record,
contention was raised by the Insurance Company from the very beginning that the vehicle
was a transport vehicle, which was driven by Ram Narain who was holding licence to ply
only Light Motor Vehicle. Hence, he could not have plied the vehicle in question, a
finding was recorded in favour of the Insurance Company by the District Forum which
had not been disturbed by the State Commission or by the National Commission and
hence the complaint ought to have been dismissed. 1999 AIR SCW 3142

15. The learned counsel for the respondent submitted that it was the case of the
complainant before District Forum that the vehicle was driven by Mohd. Julfikar who
possessed valid licence to ply the vehicle but as soon as the accident took place, he fled
away since he was scared that passengers in the bus might not spare him and he might be
beaten. As Ram Narain sustained several injuries, he could not go away. Unfortunately,
the District Forum dismissed the complaint which necessitated challenging the decision
and the complainant succeeded before the State Forum and National Forum. As to Ashok
Gangadhar, the counsel submitted that the said decision helps the complainant and both
the Commissions were right in following it and in directing the Insurance Company to
pay compensation to the complainant. He, therefore, submitted that the appeal deserves to
be dismissed.
16. Before we deal with contentions raised by the parties on merits, it would be
appropriate to examine the relevant provisions of the Motor Vehicles Act, 1988
(hereinafter referred to as 'the Act'). By the Act of 1988, the Motor Vehicles Act, 1939
(old Act) had been repealed. The new Act has been enacted with a view 'to consolidate
and amend the law relating to motor vehicles'. Section 2 is a 'legislative dictionary' and
defines various terms. Relevant clauses of the said section are Clauses (10), (14), (21),
(28) and (47) which define 'driving licence', 'goods carriage', 'light motor vehicle', 'motor
vehicle' and 'transport vehicle' respectively. They read as under:
2. Definitions.- In this Act, unless the context otherwise requires,
(10) "driving licence" means the licence
@page-SC618
issued by a competent authority under Chapter II authorising the person specified therein
to drive, otherwise than as a learner, a motor vehicle or a motor vehicle of any specified
class or description;
(14) "goods carriage" means any motor vehicle constructed or adapted for use solely for
the carriage of goods, or any motor vehicle not so constructed or adapted when used for
the carriage of goods;
(21) "light motor vehicle" means a transport vehicle or omnibus the gross vehicle weight
of either of which or a motor car or tractor or road-roller the unladen weight of any of
which, does not exceed 7,500 kilograms;
(28) "motor vehicle" or "vehicle" means any mechanically propelled vehicle adapted for
use upon roads whether the power of 1 Subs. and ins. by Act. 580 propulsion is
transmitted thereto from an external or internal source and includes a chassis to which a
body has not been attached and a trailer; but does not include a vehicle running upon
fixed rails or a vehicle of a special type adapted for use only in a factory or in any other
enclosed premises or a vehicle having less than four wheels fitted with engine capacity of
not exceeding thirty-five cubic centimetres;
(47) "transport vehicle" means a public service vehicle, a goods carriage, an educational
institution bus or a private service vehicle;
17. Section 3(1) of the Act requires holding of driving licence which is material and reads
thus:
3. Necessity for driving licence.- (1) No person shall drive a motor vehicle in any public
place unless he holds an effective driving licence issued to him authorising him to drive
the vehicle; and no person shall so drive a transport vehicle other than a motor cab hired
for his own use or rented under any scheme made under sub- section (2) of section 75
unless his driving licence specifically entitles him so to do.
(Emphasis supplied)
18. Section 5 declares that no owner or person in charge of a motor vehicle shall cause or
permit any person which does not satisfy the provisions of Section 3 to drive the vehicle.
Section 10 deals with form and contents of licences. It enacts that every driving licence
(except a driving licence issued under Section 18 which provides for driving motor
vehicles belonged to the Central Government) shall be in such form and shall contain
such information as may be prescribed by the Central Government. It also states that a
driving licence shall be expressed as entitling the driver to drive a motor vehicle of one or
more of the types of motor vehicles specified in sub-section (2). Section 15 provides for
'renewal of driving licences'. Section 27 empowers the Central Government to make rules
in respect of matters enumerated therein. Section 66 prohibits an owner of motor vehicle
to use or to permit the use of motor vehicle as a transport vehicle in any public place save
in accordance with the conditions of permit granted by an appropriate authority. Whereas
Section 147 deals with requirements of policies and limits of liability, Section 149
imposes duty on insurers to satisfy judgments and awards against persons insured in
respect of third party risks.
19. The Central Government has framed rules known as the Central Motor Vehicles
Rules, 1989 (hereinafter referred to as 'the Rules').
20. Rule 16 of the Rules prescribes the form in which driving licence is issued. The form
provides that the holder of a licence can drive any vehicle of the description mentioned
therein. Where authorization is granted to drive transport vehicle, it is expressly so
provided by making an endorsement to that effect.
21. Now, it is the case of the Insurance Company that the vehicle of the complainant
which met with an accident was a 'transport vehicle'. It was submitted that the insured
vehicle was a 'goods carriage' and was thus a 'transport vehicle'. The vehicle was driven
by Ram Narain, who was authorized to drive Light Motor Vehicle and not a transport
vehicle. Since the driver had no licence to drive transport vehicle in absence of necessary
endorsement in his licence to that effect, he could not have driven Tata 709 and when that
vehicle met with an accident, Insurance Company could not be made liable to pay
compensation.
22. Now, let us consider both these points. As far as vehicle is concerned, it is clear from
the record that it was Tata 709, registration No.RJ-20G-2828. The permit in respect of the
said vehicle is on record issued by the Transport Authority, Kota. From the registration, it
is clear that it was registered as a truck, a goods carrier and
@page-SC619
was described as public carrier. Load carrying capacity was shown to be 4100.00 Kgs.
The permit was valid up to November 11, 2002.
23. The District Forum held that the documents clearly mentioned that the vehicle was a
'goods carriage' as defined in Section 2(14) covered by the category of 'transport vehicle'
under Section 2(47) of the Act. The State Commission held that since the gross weight of
the vehicle was only 6800 Kgs. and did not exceed permissible limits (7500 Kgs.) nor it
was carrying goods at the time of accident, it was a Light Motor Vehicle. For coming to
that conclusion, the State Commission relied upon Ashok Gangadhar.

24. In our considered view, the State Commission was wrong in reversing the finding
recorded by the District Forum. So far as Ashok Gangadhar is concerned, we will deal
with the said decision little later but from the documentary evidence on record and
particularly, from the permit issued by the Transport Authority, it is amply clear that the
vehicle was a 'goods carrier' [Section 2(14)]. If it is so, obviously, it was a 'transport
vehicle' falling under clause (47) of Section 2 of the Act. The District Forum was,
therefore, right in considering the question of liability of the Insurance Company on the
basis that Tata 709 which met with an accident was 'transport vehicle'.
25. The second question is as to who was driving the vehicle which collided with M.P.
Roadways Bus on April 17, 1998. In this connection, it may be stated that it was the case
of the complainant that the vehicle (Tata 709) was driven by Mohd. Julfikar to Indore.
Because of rash and negligent driving by Kalu, driver of other vehicle i.e. M.P. Roadways
bus, there was an accident and Ram Narain, brother of the complainant, sustained serious
injuries. Mohd. Julfikar was having valid licence to drive Light Motor Vehicle (LMV) as
well as Heavy Motor Vehicle (HMV) and hence the complainant was entitled to
compensation from the Insurance Company.
26. The contention of the Insurance Company, on the other hand, was that it conducted an
inquiry which revealed that at the time of accident it was not Mohd. Julfikar who was
driving the vehicle, but it was Ram Narain who was driving it. Ram Narain was having
licence to drive Light Motor Vehicle only and since the vehicle in question was a
transport vehicle, he could not have driven the said vehicle in absence of an endorsement
as required by law and hence the complainant was not entitled to any amount from the
Insurance Company and the Insurance Company could not be held liable.
27. The District Forum, as observed earlier, considered the assertion of the complainant
and the defence of the Insurance Company as to who was driving Tata 709 and on the
basis of overall evidence adduced before it, held that it was Ram Narain who was driving
the vehicle that met with an accident. The said Ram Narain was not having licence to
drive transport vehicle and as such, Insurance Company was not liable. The District
Forum noted that in the FIR lodged in respect of the accident, Ram Narain was shown to
be the driver of the vehicle. Not only that but the evidence adduced before the District
Forum also went to show that at the time of accident, Ram Narain was the driver of the
insured vehicle. The argument of the complainant that the officials of the Insurance
Company obtained his signatures on some documents without reading them over and
making the claimant to understand the contents thereof was negatived. The assertion of
the complainant that he was 'illiterate' and was knowing only how to put his signature
was also not believed by the District Forum. The said finding of fact has not been set
aside either by the State Commission or by the National Commission. Even otherwise,
from the evidence on record, we are satisfied that it was Ram Narain who was driving the
vehicle at the time of accident. We have, therefore, to proceed to consider whether the
complainant was entitled to claim compensation from the Insurance Company in such an
eventuality.
28. The argument of the Insurance Company is that at the time of accident, Ram Narain
had no valid and effective licence to drive Tata 709. Indisputably, Ram Narain was
having a licence to drive Light Motor Vehicle. The learned counsel for the Insurance
Company, referring to various provisions of the Act submitted that if a person is having
licence to drive Light Motor Vehicle, he cannot drive a transport vehicle unless his
driving licence specifically entitles him so to do (Section 3). Clauses (14), (21), (28) and
(47) of Section 2 make it clear that
@page-SC620
if a vehicle is 'Light Motor Vehicle', but falls under the category of Transport Vehicle, the
driving licence has to be duly endorsed under Section 3 of the Act. If it is not done, a
person holding driving licence to ply Light Motor Vehicle cannot ply transport vehicle. It
is not in dispute that in the instant case, Ram Narain was having licence to drive Light
Motor Vehicle. The licence was not endorsed as required and hence, he could not have
driven Tata 709 in absence of requisite endorsement and Insurance Company could not be
held liable.
29. We find considerable force in the submission of the learned counsel for the Insurance
Company. We also find that the District Forum considered the question in its proper
perspective and held that the vehicle driven by Ram Narain was covered by the category
of transport vehicle under Clause (47) of Section 2 of the Act. Section 3, therefore,
required the driver to have an endorsement which would entitle him to ply such vehicle.
It is not even the case of the complainant that there was such endorsement and Ram
Narain was allowed to ply transport vehicle. On the contrary, the case of the complainant
was that it was Mohd. Julfikar who was driving the vehicle. To us, therefore, the District
Forum was right in holding that Ram Narain could not have driven the vehicle in
question.
30

. The learned counsel for the complainant, however, heavily relied upon Ashok
Gangadhar. In that case, the appellant was the owner of a truck, Light Motor Vehicle,
which was insured with the respondent Insurance Company. The vehicle met with an
accident and a claim was lodged by the complainant before the Consumer Commission. It
was contended by the Insurance Company that the truck was a goods carriage or a
transport vehicle and since the driver of the truck was holding a driving licence issued in
Form No. 6 to drive light motor vehicle only, he was not authorized to drive transport
vehicle as there was no endorsement on his driving licence authorizing him to drive such
transport vehicle. The aggrieved complainant approached this Court. Allowing the appeal
and setting aside the order passed by the Commission, this Court held that the driver of
the vehicle was holding a valid driving licence for driving a Light Motor Vehicle and
there was no material on record to show that he was disqualified from holding an
effective valid licence at the time of accident. In view of those facts, the Court held that
the policy did not insist on the driver to have a licence to drive a transport vehicle by
obtaining a specific endorsement. Considering the definition of 'Light Motor Vehicle' as
given in Clause (21) of Section 2 of the Act, this Court held that such Light Motor
Vehicle (LMV) cannot always mean a light goods carriage. A Light Motor Vehicle
(LMV) can be a non-transport vehicle as well. The Court proceeded to observe that since
there was neither a pleading nor a permit produced on record, the vehicle remained as a
Light Motor Vehicle. And though it can be said to have been designed to use as a
transport vehicle or a goods carriage, it could not be held on account of statutory
prohibition contained in Section 66 of the Act to be a transport vehicle. It was, therefore,
held that the Commission was not right in rejecting the claim of the claimant.
Accordingly this Court set aside the order passed by the Commission and directed the
Insurance Company to pay compensation to the complainant. 1999 AIR SCW 3142

31. It is no doubt true that in Ashok Gangadhar, in spite of the fact that the driver was
holding valid driving licence to ply Light Motor Vehicle (LMV), this Court upheld the
claim and ordered the Insurance Company to pay compensation. But, in our considered
opinion, the learned counsel for the Insurance Company is right in submitting that it was
because of the fact that there was neither pleading nor proof as regards the permit issued
by the Transport Authority. In absence of pleading and proof, this Court held that, it could
not be said that the driver had no valid licence to ply the vehicle which met with an
accident and he could not be deprived of the compensation. This is clear if one reads
paragraph 11 of the judgment, which reads thus:
"11. To reiterate, since a vehicle cannot be used as transport vehicle on a public road
unless there is a permit issued by the Regional Transport Authority for that purpose, and
since in the instant case there is neither a pleading to that effect by any party nor is there
any permit on record, the vehicle in question would remain a light motor vehicle. The
respondent also does not say that any permit was granted to the appellant for plying the
vehicle as a transport vehicle under Section 66 of the Act, Moreover, on the date of
accident, the vehicle was
@page-SC621
not carrying any goods, and though it could be said to have been designed to be used as a
transport vehicle or goods-carrier, it cannot be so held on account of the statutory
prohibition contained in Section 66 of the Act."
(Emphasis supplied)
32. In our judgment, Ashok Gangadhar did not lay down that the driver holding licence to
drive a Light Motor Vehicle need not have an endorsement to drive transport vehicle and
yet he can drive such vehicle. It was on the peculiar facts of the case, as the Insurance
Company neither pleaded nor proved that the vehicle was transport vehicle by placing on
record the permit issued by the Transport Authority that the Insurance Company was held
liable.
33

. In the present case, all the facts were before the District Forum. It considered the
assertion of the complainant and defence of the Insurance Company in the light of the
relevant documentary evidence and held that it was established that the vehicle which
met with an accident was a 'transport vehicle'. Ram Narain was having a licence to drive
Light Motor Vehicle only and there was no endorsement as required by Section 3 of the
Act read with Rule 16 of the Rules and Form No. 6. In view of necessary documents on
record, the Insurance Company was right in submitting that Ashok Gangadhar does not
apply to the case on hand and the Insurance Company was not liable. 1999 AIR
SCW 3142

34. The matter can be looked from another angle also. Section 14 referred to above,
provides for currency of licence to drive motor vehicles. Sub-section (2) thereof
expressly enacts that a driving licence issued or renewed under the Act shall, "in the case
of a licence to drive a transport vehicle, be effective for a period of three years". It also
states that "in the case of any other licence, if the person obtaining the licence, either
originally or on renewal thereof, had not attained the age of fifty years on the date of
issue or, as the case may be, renewal thereof, be effective for a period of twenty years
from the date of such issue or renewal". It is thus clear that if a licence is issued or
renewed in respect of a transport vehicle, it can be done only for a period of three years.
But, in case of any other vehicle, such issuance or renewal can be for twenty years
provided the person in whose favour licence issued or renewed had not attained the age
of 50 years. In the present case, the licence was renewed on November 17, 1995 up to
November 16, 2015 i.e. for a period of twenty years. From this fact also, it is clear that
the licence was in respect of 'a motor vehicle other than the transport vehicle'.
35

. The learned counsel for the Insurance Company also referred to a decision of this Court
in National Insurance Company v. Kusum Rai and Ors., (2006) 4 SCC 250, wherein this
Court held that if the vehicle is a taxi which is being driven by a driver holding licence
for driving Light Motor Vehicle only without there being any endorsement for driving
transport vehicle, the Insurance Company cannot be ordered to pay compensation. 2006
AIR SCW 1649

36

. We may also refer to a decision of the High Court of Himachal Pradesh in New India
Assurance Co. Ltd., Shimla v. Suraj Prakash and Ors., AIR 2000 HP 91. There the vehicle
involved in an accident was taxi, a public service vehicle. But the licence issued in favour
of the driver was to ply light motor vehicle and there was no endorsement to drive
transport vehicle. It was, therefore, held by the High Court that the Insurance Company
cannot be saddled with the liability to pay compensation to the claimant. There too, the
claimant placed reliance on Ashok Gangadhar. The Court, however, distinguished it
observing that "there was neither any evidence therein nor was there any claim for insurer
that the vehicle concerned therein was having a permit for goods carriage or that it had a
permit or authorization for plying the vehicle as a transport vehicle". In our considered
view, the High Court was right in taking the above view. 1999 AIR SCW 3142

37

. The learned counsel for the complainant invited our attention to certain decisions of this
Court. In Skandia Insurance Co. Ltd. v. Kokilaben Chandravadan and Ors., (1987) 2 SCC
654, it was held that if a truck driver leaves the truck with engine in motion after handing
over the truck to cleaner who was not a duly licensed person who drives the truck which
causes an accident, it cannot be contended by the Insurance Company that it would not be
liable to pay compensation to a third party who sustains injury because of the accident.
AIR 1987 SC 1184

38. The ratio laid down in Skandia Insurance Co. Ltd., in our considered
@page-SC622
opinion, does not apply to the case on hand as it was in respect of 'third party' that the
Court held that the Insurance Company must pay compensation. This is clear from
paragraph 13 of the judgment in which the Court stated:
"13. In order to divine (sic derive) the intention of the legislature in the course of
interpretation of the relevant provisions there can scarcely be a better test than that of
probing into the motive and philosophy of the relevant provisions keeping in mind the
goals to be achieved by enacting the same. Ordinarily it is not the concern of the
legislature whether the owner of the vehicle insures his vehicle or not. If the vehicle is
not insured any legal liability arising on account of third party risk will have to be borne
by the owner of the vehicle. Why then has the legislature insisted on a person using a
motor vehicle in a public place to insure against third party risk by enacting Section 94.
Surely the obligation has not been imposed in order to promote the business of the
insurers engaged in the business of automobile insurance. The provision has been inserted
in order to protect the members of the Community travelling in vehicles or using the
roads from the risk attendant upon the user of motor vehicles on the roads. The law may
provide for compensation to victims of the accidents who sustain injuries in the course of
an automobile accident or compensation to the dependents of the victims in the case of a
fatal accident. However, such protection would remain a protection on paper unless there
is a guarantee that the compensation awarded by the Courts would be recoverable from
the persons held liable for the consequences of the accident. A Court can only pass an
award or a decree. It cannot ensure that such an award or decree results in the amount
awarded being actually recovered, from the person held liable who may not have the
resources. The exercise undertaken by the law Courts would then be an exercise in
futility. And the outcome of the legal proceedings which by the very nature of things
involve the time cost and money cost invested from the scarce resources of the
Community would make a mockery of the injured victim, or the dependents of the
deceased victim of the accident, who themselves are obliged to incur not inconsiderable
expenditure of time, money and energy in litigation. To overcome this ugly situation the
legislature has made it obligatory that no motor vehicle shall be used unless a third party
insurance is in force. To use the vehicle without the requisite third party insurance being
in force is a penal offence (Section 94 of the Motor Vehicles Act). The legislature was
also faced with another problem. The insurance policy might provide for liability walled
in by conditions which may be specified in the contract of policy. In order to make the
protection real, the legislature has also provided that the judgment obtained shall not be
defeated by the incorporation of exclusion clauses other than those authorised by Section
96 and by providing that except and save to the extent permitted by Section 96 it will be
the obligation of the Insurance Company to satisfy the judgment obtained against the
persons insured against third party risks. (vide Section 96). In other words, the legislature
has insisted and made it incumbent on the user of a motor vehicle to be armed with an
insurance policy covering third party risks which is in conformity with the provisions
enacted by the legislature. It is so provided in order to ensure that the injured victims of
automobile accidents or the dependents of the victims of fatal accidents are really
compensated in terms of money and not in terms of promise. Such a benign provision
enacted by the legislature having regard to the fact that in the modern age the use of
motor vehicles notwithstanding the attendant hazards, has become an inescapable fact of
life, has to be interpreted in a meaningful manner which serves rather than defeats the
purpose of the legislation. The provision has, therefore, to be interpreted in the twilight of
the aforesaid perspective."
39

. Similar is the reasoning and conclusion in B. V. Nagaraju v. M/s. Oriental Insurance Co.
Ltd., (1996) 4 SCC 647. In that case, there was breach of condition as to carry passengers
in a goods vehicle more than the number permitted in terms of insurance policy. The
Court there held that the breach of the said provision could not be said to be such a
fundamental character so as to afford ground to the insurer to deny indemnification unless
there were some factors which contributed to the causing of the accident. The Court held
that exclusionary provision in the insurance policy must be retained so as to serve the
main purpose of the policy which was to indemnify the damage caused 1996 AIR
SCW 2466

@page-SC623
to the vehicle.
40

. In Jitendra Kumar v. Oriental Insurance Co. Ltd. and Anr. (2003) 6 SCC 420, the Court
held that if the vehicle was damaged due to accidental fire, the fact that the driver was not
holding valid driving licence at the time of incident would not empower the Insurance
Company to repudiate the claim and it could not be put forward as a ground to deny the
liability of the Insurance Company that the driver did not have valid licence at the time of
accident in question. 2003 AIR SCW 3739

41
. Finally, a reference was made to National Insurance Co. Ltd. v. Swaran Singh and Ors.
(2004) 3 SCC 297. That case also related to third party victims of motor vehicle accidents
and to us the ratio in Swaran Singh does not carry the case of the claimant further. 2004
AIR SCW 663

42. For the aforesaid reasons, in our opinion, the conclusion arrived at by the District
Forum cannot be said to be faulty and it was right in holding that on the basis of the
evidence adduced by the Insurance Company, the complainant was not entitled to claim
any compensation from the Insurance Company and Insurance Company cannot be held
liable. The decision could not have been interfered with by the State Commission or by
the National Commission and hence the orders of the State Commission and National
Commission are liable to be set aside by restoring the order passed by the District Forum.
we do accordingly.
43. The appeal is, therefore, allowed. The orders passed by the State Commission and
National Commission are set aside and the order passed by the District Forum is restored.
44. In the matter of Nasir Ahmed (SLP No. 7618 of 2005), the vehicle was a luxury taxi -
passenger carrying commercial vehicle. There also the driving licence issued in favour of
the driver was to ply Light Motor Vehicle (LMV) and hence the driver could not have
driven the vehicle in question. In that case too, the licence was renewed for a period of
twenty years i.e. from February 5, 2000 to February 4, 2020. Again, there was no
endorsement as required by Section 3 of the Act. A specific plea was taken by the
Insurance Company but the Authorities held the Insurance Company liable which could
not have been done. The reasoning and conclusion arrived at by us in the matter of
Prabhu Lal (SLP No. 7370 of 2004) would apply to the case of Nasir Ahmed. That appeal
is, therefore, allowed.
45. In Chandra Prakash Saxena (SLP No. 17794 of 2004), the vehicle involved in
accident was a Jeep Commander made by Mahindra and Mahindra, a passenger carrying
commercial vehicle, and in view of the fact that the driver was holding licence to drive
Light Motor Vehicle (LMV), he could not have plied the vehicle in question. For the
reasons recorded hereinabove in the main matter of Prabhu Lal i.e. SLP(C) No. 7370 of
2004, the Insurance Company could not have been held liable and that appeal also
deserves to be allowed.
46. For the foregoing reasons, all the three appeals are allowed and the orders passed
against the Insurance Company are set aside holding that the Insurance Company cannot
be held liable. There shall, however, be no order as to costs.
Appeals allowed.
AIR 2008 SUPREME COURT 623 "State of Rajasthan v. Pareshar Soni"
(From : AIR 2005 Rajasthan 271)
Coram : 2 G. P. MATHUR AND ALTAMAS KABIR, JJ.
Petition for Special Leave to Appeal (C) No. 24912 of 2005, D/- 20 -11 -2007.
State of Rajasthan and Ors. v. Pareshar Soni.
Rajasthan Municipalities Act (38 of 1959), S.173A (Before its amendment in 1999) -
MUNICIPALITIES - SALE DEED - AMENDMENT - LAND - Change of user -
Charges, for - Respondent acquiring title to land in question by registered sale deed in
year 1987 - Predecessor-in-interest of respondent acquiring ownership and possession of
property pursuant to decree passed by High Court - Plea by respondent that land was
never allotted to her predecessor by Municipality or State Govt., remaining unrebutted -
Amended S. 173-A thus, restricting user of land for purpose other than that for which it
was originally allotted or sold by Municipality or Corporation - Would not apply -
Consequently, demand by Municipality for conversion charges from respondent - Cannot
be made. (Paras 14, 15, 16, 18, 19)

Ms. Madhurima Tatia and Aruneshwar Gupta, for Appellants; Rajendra Singhvi and
Ashok Kumar Singh, for Respondent.
@page-SC624

Judgement
1. ALTAMAS KABIR, J. :-Since the issue to be decided in this special leave petition is
limited to the interpretation of Section 173-A of the Rajasthan Municipalities Act, 1959
(hereinafter referred to as 'the Act'), it was decided to hear out the special leave petition at
the admission stage itself.
2. The facts involved in the special leave petition, in brief, are as follows:
3. The respondent herein, Pareshar Soni, purchased an old house situated at Moti Chowk,
Jodhpur, from one Smt. Shanti Kumari Lodha by a registered sale deed dated 15.5.1987.
It appears from the judgment forming the subject-matter of the special leave petition that
Smt. Shanti Kumari acquired the ownership and possession of the said property pursuant
to a judgment and decree passed by the Calcutta High Court on 6.6.1972 in Civil Suit No.
867 of 1934. After purchasing the property the said respondent filed an application before
the Municipal Corporation, Jodhpur, under Section 170(1) of the Act seeking permission
to construct a residential house and a few shops on the said property. Inasmuch as, the
Municipal Corporation did not take any step on the said application, a notice was sent on
behalf of the respondent herein to the Corporation under Section 170(8) of the Act
providing for a response within 15 days of receipt of the notice. It appears that the
Corporation did not pay any heed even to the said notice, and accordingly, by invoking
the deeming clause the respondent started construction work on the said property.
4. On 24th May, 1997 the Municipal Corporation raised a demand upon the respondent
for a sum of Rs.1,66,874/- by way of conversion charges and compounding fees. The
respondent objected to the said demand and filed a representation challenging its validity
on the ground that the property in question is nearly 200 years old and reference thereto
had been made in a Patta of the year 1865 pertaining to a neighbouring house, showing
the property to be a free-hold property. Consequently, according to the respondent, no
commercial charges could be levied thereupon. The respondent, however, deposited a
sum of Rs.1,619 towards construction fees. As the representation filed by the respondent
did not yield any result, the respondent was compelled to file a writ petition before the
Jodhpur Bench of the Rajasthan High Court, being SBC Writ Petition No. 2159 of 1997.
The Municipal Corporation, Jodhpur, which is the petitioner No. 2 in the present special
leave petition filed its reply contending that Section 173-A of the Act permits the State
Government to allow any person to use the land for the purposes other than for which it
was originally allotted. It was also contended that the regulation of the areas, markets etc.
were all within the compass of the Act and the 'Patta' said to have been issued by the
earlier State would also remain subject to the Act. One other stand which was taken
before the learned Single Judge was that the respondent/writ petitioner had failed to
produce a copy of the Patta for the property in question to indicate the rights and the
conditions of usage of the land provided therein. Upon hearing the parties the learned
Single Judge by his judgment and order dated 19th July, 1999 dismissed the writ petition
solely on the ground of non-production of the Patta by the respondent herein.
5. The respondent thereupon filed a Special Appeal before the Division Bench of the
aforesaid High Court, being DB (Civil) Special Appeal No.1109/1999. Before the
Division Bench the main contention advanced on behalf of the respondent herein was that
the property in dispute was a free-hold Hindu Undivided Family (HUF) property which
was nearly 2 centuries old and at the relevant point of time the erstwhile State had
allotted the same on a free-hold basis. Consequently, the provisions of Section 173-A of
the Act would not apply in the instant case.
6. It was also contended on behalf of the respondent that the impugned demand notice
was illegal and without any legal validity because the said property had neither been
allotted nor sold to the respondent or her predecessor-in-interest by the Municipal
Corporation or the State Government, as contemplated in Section 173-A of the Act, and
as such no conversion charges or compounding fees could be levied and demanded by the
Municipal Authorities.
7. While deciding the appeal, the Division Bench on a bare reading of Section 173-A of
the Act observed that in order that the said section should apply, two conditions were
necessary : (i) that the land has been allotted or sold to any person by the Municipal
Corporation or the State Government, and (ii) that the allotment or sale of
@page-SC625
the land by the Municipal Corporation or the State Government was subject to the
condition of limiting its use for a particular purpose. The Division Bench also observed
that if either of the two conditions were not fulfilled the provisions of Section 173-A
would not apply. Basing its decision on the contention advanced on behalf of the
respondent that the said property had never been sold or allotted to them being a HUF
property, the Division Bench affirmed the view taken by the Single Judge and, after going
through the registered sale deed, came to the conclusion that the property had neither
been allotted nor sold by the Municipal Corporation or the State Government and that too
for specific purpose. The Division Bench also came to a finding that there was no
evidence on record to suggest that the land in question had come into the hands of
respondents herein with certain conditions limiting its use. Noting that the averments in
the writ petition stood unrebutted the Division Bench also concluded that it had been
established that the respondent herein acquired the ownership and possession over the
land by the registered sale deed without any condition or restraint on its use. On the basis
of its aforesaid finding, the Division Bench allowed the appeal filed by the respondent
herein and set aside the order of the single Judge. Consequentially, the writ petition filed
by the respondent herein was allowed.
8. On behalf of the petitioners it was submitted that the only point which required an
answer in the instant special leave petition was whether the provisions of sub-section (4)
of Section 173-A of the Act which had been introduced by amendment in 1999 would
apply to the case of the respondent when admittedly she had acquired title to the property
on 15th May, 1987 long prior to the said amendment. It was submitted that since the
amendment had been effected, the Municipal Corporation was entitled to raise a demand
on the basis thereof on account of the change of user of the land by the respondent.
9. It was also submitted that the single Judge had not committed any error in dismissing
the writ application on the ground that the writ petitioner/respondent herein had failed to
produce the 'Patta' of the property which would have clearly indicated the use to which
the said property could be applied. In the absence of any evidence to the contrary,
produced by the writ petitioner/respondent herein, the single Judge had very rightly held
that it was not possible to accept the bald statement made on behalf of the writ
petitioner/respondent herein that the property had not been allotted or sold to her
predecessor-in-interest either by the Municipal Corporation or the State Government.
10. The submissions made on behalf of the appellant were controverted on behalf of the
respondent and it was urged that the registered sale deed by which the respondent herein
had acquired the property had not indicated any condition relating to specific user of the
property in question. Apart from the above, reference had been made to a 'Patta' of 1965
issued in favour of the owner of the adjoining property which indicated that the said
property was free-hold on which there could be no levy of commercial charges. The said
statement of fact had not been rebutted by the petitioner and the representation filed by
the respondent remained unattended to and unanswered by the petitioner. It was
submitted on behalf of the respondent that in the absence of any evidence produced on
behalf of the Municipal Corporation, the Division Bench had not committed any error in
coming to the conclusion that the respondent had been able to establish that she had
acquired ownership and possession over the property by a registered sale deed without
any condition placing any limitation on its use.
11. On the question of application of sub-section (4) of Section 173-A, as introduced in
the Act by the amendment of 1999, it was submitted that, in any event, the same could
have no application since the respondent by raising a residential house and shops had not
violated any of the provisions of the Act in force at the relevant time, since there was no
restriction on the user of the land when it was acquired by the respondent.
12. In view of the difference in the unamended provisions of Section 173-A and the
amendments introduced therein by the Rajasthan Municipalities (Amendment) Act, 1999,
it would be appropriate at this stage to set out the unamended provisions of Section 173-
A as well as the amendments effected therein by the aforesaid Amending Act of 1999.
13. Section 173-A of the Act prior to its amendment was as follows:
@page-SC626
173-A. Power of the State Government to allow change in the use of land-
(1) Notwithstanding anything contained in this Act, where any land has been allotted or
sold to any person by a municipality or the State Government subject to the condition of
restraining its use for a particular purpose, the State Government may, if it is satisfied so
to do in public interest, allow the owner or holder of such land to use it for any other
purpose other than the purpose for which it was originally allotted or sold, on payment of
such conversion charges as may be prescribed :
Provided that the rates of conversion charges may be different for different areas and for
different purposes.
(2) The conversion charges so realised shall be credited to the Consolidated Fund of the
State or to the fund of the Municipality as may be determined by the State Government.
(3) Such charges shall be the first charge on the interest of the person liable in the land
the use of which has been changed and shall be recoverable as arrears of land revenue.
Section 173-A of the Act as amended by the Amending Act of 1999 reads as follows:
173-A. Restriction on change of use of land and power of the State Government to allow
change of use of land-
(1) No person shall use or permit the use of any land situated in any municipal area, for
the purpose other than that for which such land was originally allotted or sold to any
person by the State Government, any Municipality, any other local authority in
accordance with any law for the time being inforce or, otherwise than as specified under a
Master Plan, wherever it is in operation.
(2) In the case of any land not allotted or sold as aforesaid and not covered under sub-
section (1), no person shall use or permit the use of any such land situated in a municipal
area for the purpose other than that for which such land use was or is permissible, in
accordance with the Master Plan, wherever it is in operation, or under any law for the
time being in force.
(3) Notwithstanding anything contained in sub-section (1) or sub-section (2), the State
Government or any authority authorised by it by notification in the Official Gazette, may
allow the owner or holder of any such land to have change of use thereof, if it is satisfied
so to do in public interest, on payment of conversion charges at such rates and in such
manner as may be prescribed with respect to the following changes in use :-
(i) From residential to commercial or any other purpose; or
(ii) From commercial to any other purpose; or
(iii) From industrial to commercial or any other purpose; or
(iv) From cinema to commercial or any other purpose:
Provided that rates of conversion charges may be, different for different areas and for
different purposes.
(4) Any person who has already changed the use of land in violation of the provisions of
this Act in force at the time of change of use, shall apply to the State Government or any
authority authorised by it under sub-section (3), within six months from the date of
commencement of the Rajasthan Municipalities (Amendment) Act, 1999 (Act No.19 of
1999) for regularisation of said use and upon regularisation of the change of use of land
he shall deposit the amount contemplated under sub-section (3).
14. From the submissions made on behalf of the respective parties and the materials on
record, admittedly the respondent herein acquired title to the property in question by a
registered sale deed dated 15.5.1987. It is also not denied that her predecessor-in-interest
acquired ownership and possession of the property pursuant to a judgment and decree
passed by the Calcutta High Court on 6.6.1972 in Civil Suit No. 867 of 1934.
15. There is also no dispute that the respondent filed an application under Section 170(1)
of the Act on 5.1.1996 seeking permission to construct a residential house and shops on
the property in question and not having received any response thereto, a notice was given
on her behalf under Section 170(8) of the Act, which was also not replied to and
consequently on the basis of the deeming provision the respondent started construction
invoking such deeming clause contained in sub-section (8) of Section 170 itself.
16. While it is true that the respondent
@page-SC627
had not produced a copy of the 'Patta' for the property in question she had all along
contended that the property in question had never been allotted to her predecessor-in-
interest either by the Municipal Corporation or by the State Government, which stand
stood unrebutted on behalf of the petitioner. There is also no denial by the petitioner that
the property had been acquired by the predecessor-in-interest of the respondent by virtue
of a decree passed by the Calcutta High Court in respect of the ancestral properties of the
parties to the suit.
17. In such circumstances, we do not think it will be proper for this Court in the special
leave petition to once again embark on an inquiry, without any evidence on record, as to
whether the property had been allotted either by the Municipal Corporation or the State
Government. In either case, some record would have been maintained either by the
Municipal Corporation or the State Government, which was not produced either before
the Court in the writ proceedings or before us.
18. We, therefore, have to accept the conclusion of the Division Bench that the property
had neither been allotted by the Municipal Corporation or by the State Government or
that any restriction had been placed on its user. Consequently, the question of demanding
conversion charges for change of user would also not arise and the amended provisions of
sub-section (4) of Section 173-A would also have no application to the facts of the case,
since it is controlled by the very opening words that no person shall use or permit the use
of any land situated in any municipal area, for the purpose other than that for which such
land was originally allotted or sold to any person by the State Government. If the basis on
which sub-section (4) of Section 173-A could be applied, is not available to the petitioner
the demand raised by it towards conversion charges also is not maintainable.
19. We, therefore, have no hesitation in holding that Section 173-A as amended in 1999
would not apply to the case of the respondent and the Division Bench of the Rajasthan
High Court at Jodhpur had correctly allowed the appeal by the respondent.
20. In that view of the matter, the instant special leave petition is dismissed, but there
shall be no order as to costs.
Petition dismissed.
AIR 2008 SUPREME COURT 627 "Murugan v. State"
(From : Madras)
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Criminal Appeal No. 1276 of 2005, D/- 4 -12 -2007.
Murugan and Ors. v. State.
Penal Code (45 of 1860), S.300 - MURDER - Murder - Infliction of single injury - By
itself not relevant factor to hold that accused had no intention to cause murder of
deceased.
Infliction of a single injury by itself is not a relevant factor to hold that the assailant had
no intention to cause murder of the deceased. What is important in a case of this nature is
to consider the entire circumstances to arrive at one conclusion or the other. When a
group of people come with an intention to assault particular person(s), with dangerous
weapon, the same would attract to principles laid down in AIR 1956 SC 465. Injured
prosecution witnesses testified in regard to the intention of the accused to cause the death
of the deceased. Thus, conviction of the accused for murder could not be interfered with.
(Paras 13, 14, 17)
Cases Referred : Chronological Paras
2007 AIR SCW 5230 : 2007 Cri LJ 4294 (Ref.) 13
AIR 1958 SC 465 : 1958 Cri LJ 818 (Rel. on) 11, 13
Shekhar Naphade, Sr. Advocate, T. Raja, Gopal Singh, Atulesh Kumar and Vishal
Jogdand, for Appellants; V. Kanakaraj, Sr. Advocate, V. G. Pragasam, S. Joseph Aristotle
and S. Prabhu Ramasubramanian, for Respondent.
Judgement
1. S. B. SINHA, J. :- This appeal is directed against a judgment and order dated
14.10.2004 passed by a Division Bench of the Madras High Court, Madurai Bench in
Criminal Appeal No.115 of 1997 whereby and whereunder the appeal preferred by the
appellants herein against a judgment of conviction and sentence dated 10.2.1997 passed
by the Additional District and Sessions Judge-cum-Chief Judicial Magistrate,
Ramanathpuram convicting the accused No. 7 under Section 302 of the Indian Penal
Code and sentencing him to undergo life imprisonment and accused Nos. 8, 9 and 10
under Section 324 of the Indian Penal Code and sentencing them to undergo one year's
rigorous imprisonment was dismissed.
@page-SC628
2. A quarrel ensued between the prosecution party and the accused on 10.7.1973 in regard
to drawing of water from a well. Accused were said to have been bearing grudge towards
the deceased as a criminal case was instituted against them at Kumuthi Police Station. On
4.8.1993, at about 6.15 p.m., a procession of villagers was taken out for celebrating a
festival known as "Mulaipari" festival. It started at village Keelamathupatti. When the
procession reached near the village known as Gandaru, with a view to commit murder of
PW-5, Nagarajan and other persons, the accused persons who were 11 in number
allegedly formed an unlawful assembly with weapons like knife, cycle chains and sticks
in their hands. Accused No.1, Subramanian, and accused No. 3, Selvaraj, are said to have
instigated others to commit murder of PW-5 Nagarajan consequent whereupon accused
No. 4, Ramu, attacked him with a stick causing a fracture on his right hand. When
deceased Kannan tried to obstruct him from doing so, accused No. 4, Ramu, instructed
accused No.2, Selvaraj, to kill him also. Consequently, accused No.2, Selvaraj, caught
hold of the hands of Kannan, whereas accused No.6 caught hold of his shoulders. Taking
advantage of the said situation, the appellant No.1 herein (accused No.7 - Murugan) is
said to have stabbed him with a knife on his chest. Appellant No.1 is said to have caused
an injury on PW-1, Chithiraichamy, also with his knife, whereas accused No.8 attacked
PW-1 with cycle chain and caused an injury on his head thereby. Appellant No.3-
Selvaraj, (accused No.9) is said to have attacked PW-3, Kathirvel, with a knife on his
nose and head whereas accused No.10, Boomi, attacked PW-3 with a cycle chain and
caused injuries to him. PW-2, Murugesan was also attacked with a stick.
3. A First Information Report was lodged immediately after the said occurrence. Out of
11 accused, however, only accused Nos. 7 and 8 to 10, were convicted and sentenced in
the manner, as noticed hereinbefore, whereas others were acquitted. An appeal preferred
thereagainst by the appellants herein has been dismissed by reason of the impugned
judgment.
4. Mr. Naphade, learned senior counsel, in support of the appeal, would, inter alia, submit
:
(1) Appellant No.1 having inflicted only one blow with a knife on the deceased, the
offence, if any, committed by him falls under Section 304, Part II of the Indian Penal
Code and not under Section 302 thereof.
(2) Appellant No.2 (accused No.8), having examined defence witnesses to prove his plea
of alibi, the learned Sessions Judge, as also the High Court, committed a serious error in
recording a judgment of conviction against him.
In this connection our attention has been drawn to the following purported findings of the
learned Sessions Judge :
"The 8th accused has not committed the offence punishable under Section 324, IPC."
(3) All the other accused having caused only simple injuries, sentence of one year's
rigorous imprisonment is on the higher side.
5. Mr. V. Kanakaraj, learned senior counsel appearing on behalf of the State, on the other
hand, supported the impugned judgment.
6. The prosecution, in support of its case, examined twenty one witnesses.
The nature of evidence of the eye-witnesses to the occurrence whereupon strong reliance
has been placed by both the learned Sessions Judge as also the High Court being identical
in nature, we would notice the deposition of PW-1, Chithiraichamy, only. He spoke about
the incident which took place on 4th August, 1993. A complaint was made to him by a
woman named Malathi. She was reprimanded by him stating that there should not quarrel
over drawing of water. She was sent back to her home. Malathi was the daughter of the
accused No.2. While the deceased and the injured persons including the said PW-1 had
been participating in the said procession, accused Nos.1 to 3 came and gave an
exhortation to cut and kill Nagarajan. Accused No.4, Ramu, is said to have assaulted in
his right forearm. The deceased Kannan intervened. He asked them not to do so,
whereupon accused No.2 gave an exhortation to kill him, pursuant whereto accused No.6,
Challaiah caught hold of both his shoulders as a result whereof, he could not make a
move. Appellant No.1, Murugan, stabbed him on the left side of his chest. While PW-1
asked the assailants not to do so, Appellant No.1 attempted to stab him also on his neck
with a knife but as he turned his neck on the right side, a laceration was caused on the
right side of his neck. Accused No.8 also
@page-SC629
attacked him with a cycle chain on his head.
7. He wanted to cause an injury to appellant No.2 (accused No.8) with a small knife but
he was prevented from doing so by one Palaniammal as a result whereof Palaniammal
suffered a laceration in his right hand. Appellant No.3, Sathiah (accused No.9) stabbed
Kathirvelu in his hand with a knife as a result whereof he received an injury. Accused
No.10, Boomi, assaulted Kathirvelu with a cycle chain on his head resulting in causing
bleeding injury on his head and the right side nose. Accused No.11 Ramamoorthi
(accused No.4) assaulted witness Murugasan with a stick on his right upper arm
whereupon all persons shouted whereafter the accused ran away.
8. He, not only, thus, described the incident in great details but also identified the material
objects which were seized at the instance of the accused persons being the weapons of
offence. Evidence of PW-2 and other witnesses are also on the same vein.

9. Appellants had a motive. They came in a group. All of them were armed. Both parties
are related to each other. An occurrence had taken place which took place on 10th July,
1993 giving rise to initiation of a criminal case. They, with a view to take revenge, caused
murder of Nagarajan and injuries on some of the prosecution witnesses. The prosecution
witnesses were injured witnesses.
10. No cogent argument has been advanced by Mr. Naphade so as to enable him to hold
that the said witnesses are not trustworthy. They have been believed by the courts below.
Nothing has been pointed out to us as to why we should differ with the said findings.
11. Intention on the part of a person to commit murder must be gathered from the
backdrop of events and the circumstances attending thereto.
A similar question came up for consideration before this Court in Virsa Singh v. State of
Punjab [1958 AIR SC 465], wherein this Court, upon a detailed analysis of the provisions
of Sections 299 and 300 of the Indian Penal Code opined that in order to attract "thirdly"
contained in Section 300 of the Indian Penal Code, it must be established :
"To put it shortly, the prosecution must prove the following facts before it can bring a
case under Section 300 "thirdly";
First, it must establish, quite objectively, that a bodily injury is present;
Secondly, the nature of the injury must be proved; These are purely objective
investigations.
Thirdly, it must be proved that there was an intention to inflict that particular bodily
injury, that is to say, that it was not accidental or unintentional, or that some other kind of
injury was intended.
Once these three elements are proved to be present, the enquiry proceeds further and,
Fourthly, it must be proved that the injury of the type just described made up of the three
elements set out above is sufficient to cause death in the ordinary course of nature. This
part of the enquiry is purely objective and inferential and has nothing to do with the
intention of the offender."
Once the aforementioned factors are established, absence of any knowledge that an act of
that kind would likely to cause death become immaterial. The intention to cause the
bodily injury, if proved, the rest of the enquiry would be purely objective and the only
question is whether as a matter of purely objective inference, the injury is sufficient in the
ordinary course of nature to cause death.
12. The medical evidence, emanating from the deposition of PW-12, Dr.
Meenakshisundaram, reveals :
"I found the following external injuries on the body. (1) A cut injury measuring 1 x - x 3"
on the left side chest. It was in the outer aspect of the 6th left side rib bone between the
middle of the collar bone. On opening the wound, the wound has injured the intercostals
muscles and blood vessels in the middle rib bones. It has punctured the left ventricle. The
injury was slanting and upwards and forwards. It has pierced the left ventricle. There was
1½ litres of colour changed blood in the thoracic cavity. The internal injuries were as
follows :
There was no fracture of the head and rib bones. Heart was empty and pale and was
weighing 250 grams. The left ventricle was punctured. The lungs was pale and was
weighing 500 grams, and was wet when pressed. Abdomen was normal, stomach was
containing digested food. Liver weighed 1450 grams and was pale and was wet when
pressed. Spleen was also wet when pressed and weighed 165 grams, and was pale.
@page-SC630
Kidneys were pale and moist on pressure. Intestines empty. Bladder empty. There was no
fracture on the pelvis. Hyoid bone was intact and the skull was also intact. Skull
membranes were intact. Brain was pale and weighed 1450 grams. There was no intra-
cranial haemorrhage in the brain and was weighing 1250 grams. There was no fracture in
the spinal cord."
13. Infliction of a single injury by itself is not a relevant factor to hold that the assailant
had no intention to cause murder of the deceased. What is important in a case of this
nature is to consider the entire circumstances to arrive at one conclusion or the other.
When a group of people come with an intention to assault particular person(s), with
dangerous weapon, the same would attract to principles laid down in Virsa Singh (supra).
Prosecution witnesses testified in regard to their intention.

Virsa Singh's case has been followed by this Court in Anil v. State of Haryana [2007 (7)
SCALE 56]. AIR 1958 SC 465
2007 AIR SCW 5230

14. We, therefore, are unable to accede to the submissions of Mr. Naphade that appellant
No.1 had no intention to cause death of Nagarajan.
Although, in this case, there was enough material to convict other appellants for
commission of an offence under Section 302/34 of the Indian Penal Code, unfortunately,
the appellants, other than the first appellant, have been only convicted under Section 324
of the Indian Penal Code. As the State did not prefer any appeal thereagainst, this Court is
unable to alter the judgment of conviction and sentence.
15. The learned Trial Judge appears to have committed more than one mistake in his
judgment. He, while analysing the evidence of DW-1, who was examined on behalf of
appellant No.2 (accused No.8) to prove alibi on his part, although came to the conclusion
that the said evidence was not acceptable, as indicated hereinbefore, arrived at the finding
that the 8th accused has not committed the offence under Section 324 of the Indian Penal
Code. Evidently, a typographical error has crept in as otherwise he could not have
convicted him along with appellants No.3 and 4 for commission of an offence under
Section 324 of the Indian Penal Code. We may also notice that whereas in the beginning
of the judgment, he recorded the sentence imposed upon appellants No.2 to 4 to undergo
rigorous imprisonment for three years, in the operative part of the judgment, he directed
that they were sentenced to undergo rigorous imprisonment for one year only. We have,
however, no option but to hold that the later part of the judgment should be taken to be
correct.
16. So far as the purported plea of alibi of appellant No.2 is concerned, a clear finding has
been arrived at that DW-1 has manipulated Exhibit D-3 just to help the said accused. The
High Court also agreed with the said view.
We do not see any reason to differ with the views of the learned Sessions Judge as also
the High Court.
17. For the aforementioned reasons, we do not find any merit in this appeal. It is
dismissed accordingly.
Appeal dismissed.
AIR 2008 SUPREME COURT 630 "Gurdev Singh v. Narain Singh"
(From : Punjab and Haryana)*
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Civil Appeal No. 5237 of 2007 (arising out of SLP (C) No. 5476 of 2006), D/- 12 -11
-2007.
Gurdev Singh v. Narain Singh.
Civil P.C. (5 of 1908), S.47 - EXECUTION - DECREE - INJUNCTION - Powers of
executing Court - Decree for permanent injunction - Restraining appellant from planting
any tree on land in question - Decree did not speak of removal of any tree which had
already been planted - Interpreting said decree by executing Court and holding that there
should not be any tree within two karams on either side of common boundary of parties -
Not in consonance with tenor of decree - Decree holder cannot seek execution of decree
by way of removal of trees - Same could not also be directed by executing Court.
C. R. No. 4526 of 2004, D/- 23-2-2006 (PandH), Reversed. (Paras 8, 9)

Sarup Singh, Sr. Advocate, Yash Pal Dhingra, Kuldip Singh, for Appellant; G. S. Punia,
Davender Mohan Verma, Ms. Minakshi Vij, for Respondent.
* C. R. No. 4526 of 2004, D/- 23-2-2006 (PandH)
Judgement
JUDGMENT :-Leave granted.
@page-SC631
2. Respondent herein filed a suit for permanent injunction against the appellant. The suit
was marked as Civil Suit No. 226 of 1987. A decree for permanent injunction was passed
by the learned trial Judge on 19-1-1989, the operative portion whereof reads as under :
"This suit comes today before me (Balbir Singh PCS, Addl. Senior Sub Judge Jagraon)
for final disposal, in the presence of the counsel for the parties, it is ordered that :-
(illegible) the suit of the plaintiff is decreed against the defendant for a permanent
injunction restraining the one side and khasra No. 218/1 and 17/1 on the other side situate
in the area of village Abbupura Tehsil, Jagraon, District Ludhiana peculiar circumstances
of the case, the parties are left to their own costs."
3. The decree holder filed an application for execution of the decree praying, inter alia,
for removal of the tree from the lands in question. A Commissioner was appointed. He
submitted a report stating as under :
(i) I compared the site plan with the situation of the disputed property where tree of
Bohar exists.
(ii) I measured the distance of Bohar tree from the common Butt of Khasra Nos. 17/2 and
218/1 with the help of a measurement tape. The centre point of Butt upto the centre point
of radius of Bohar tree is 11 feet i.e. 2 karams.
(iii) The branches of Bohar tree comes across the common Butt into khasra No. 218/1
approximately 6/7 feet.
(iv) I prepared a rough site plan at the spot, which is also attached herewith. according to
my observation the half portion of the Bohar tree falls within two karams from the
common Butt of properties of the parties."
4. The learned Commissioner in his report did not state that the Bohar tree was planted
after passing of the decree.
5. The executing Court relying on or the basis of the said report as also some decisions of
this Court while holding that the executing Court has the requisite jurisdiction to construe
a decree, opined as under :
"Now applying ratio of the above said cases this Court has to see what was spirit of the
decree which was under execution and clear that the plain meaning of the decree is that
there should be no tree within two karams on either side of the common boundary of the
parties and if it is there, the executing Court can very well order its removal in order to
give effect to the spirit of the decree. In the present case, it has been reported by the Local
Commissioner that the tree is within 2 karams. Moreover, J. D. does not plead any claim
over that tree. Rather he pleads it to be a naturally grown tree. so, in these circumstances
direction is given to the J. D. to remove the trees which is standing within 2 karams of the
common butt within a period of one month from today."
6. By reason of the impugned judgment the High Court has affirmed the said order.
7. Mr. Swarup Singh, learned senior counsel appearing on behalf of the appellant would
submit that the executing Court as also the High Court committed a manifest error in
interpreting the decree.
8. We agree with the said contention. A bare perusal of the decree in question would
clearly demonstrate that the appellant herein was restrained by a permanent injunction
from planting any tree on khasra Nos. 17/2 on the one side and khasra No. 218/1 and 17/1
on the other side. The decree did not speak of removal of any tree which had already been
planted. The executing Court, as noticed hereinbefore, while interpreting the said decree
proceeded completely on a wrong premise to hold that there should not be any tree within
two Karams on either side of the common boundary of the parties. Such an interpretation
evidently is not in consonance with the tenor of the decree. A jurisdictional error, thus,
has been committed by the High0 Court.
9. It is well stated that executing Court cannot go behind the decree. As the decree did not
clothe the decree holder to pray for execution of the decree by way of removal of the
trees, the same could not have been directed by the learned executing Court in the name
of construing the spirit of the decree under execution.
10. We, therefore, set aside the impugned judgment and remit the matter to the executing
Court for determination of the question as to whether the Bohar tree in question was in
existence prior to passing of the decree or not. The executing Court thereafter may
proceed with the matter in accordance with law.
11. The appeal is allowed. No costs.
Appeal allowed.
@page-SC632
AIR 2008 SUPREME COURT 632 "Desh Raj v. Bodh Raj"
(From : Himachal Pradesh)
Coram : 2 K. G. BALAKRISHNAN AND R. V. RAVEENDRAN, J.
Civil Appeal No. 4676 of 2005, D/- 30 -11 -2007.
Desh Raj v. Bodh Raj.
(A) Evidence Act (1 of 1872), S.35 - EVIDENCE - DOCUMENTS - Documentary
evidence - Caste of candidate, respondent contesting election on reserved seat - Proof -
Documents like application made by his father for his admission to school, birth register
extract and village Pariwar Register extracts produced to establish caste of respondent -
Said documentary evidence cannot be said to have no evidentiary value - No
irreconcilable difference between said documents - Cannot be rejected. (Paras 20, 21)
(B) Evidence Act (1 of 1872), S.90 - DOCUMENTS - ELECTION - Caste - Proof -
Dispute as to caste of candidate contesting election - Application for admission to school
by father showing caste of candidate, produced - Said application submitted by father
containing his thumb mark - It is a document more than 30 years old - Attracts
presumption under S. 90 - Merely because there was difficulty in reading one figure in
the date in said application - Cannot be a ground to reject it.(Para 21)
(C) Representation of the People Act (43 of 1951), S.100 - ELECTION - SCHEDULED
CASTES AND SCHEDULED TRIBES - DOCUMENTS - RESERVATION - Election of
MLA - Respondent contested on seat reserved for Scheduled Caste - Documentary
evidence showing that respondent, candidate's father and his family members including
respondent held out to be and accepted as belonging to "Tarkhan Caste" which is not
Scheduled Caste - Only after 1990 respondent attempting to show that he belonged to
"Lohar" Caste which is Scheduled Caste - Caste Certificate showing his caste as "Lohar",
a Scheduled Caste issued by Executive Magistrate in 1991 - Cannot be a proof of caste of
respondent - Thus, respondent held did not belong to "Scheduled Caste" - Not qualified to
be chosen to fill seat in constitutency reserved for Scheduled Castes - His election liable
to be set aside.
Election Petition 1 of 2003, D/- 7-6-2005 (HP), Reversed.
AIR 1984 SC 905 and 1994 AIR SCW 4116, Relied on. (Paras 26, 27, 28)
Cases Referred : Chronological Paras
2005 AIR SCW 1476 : AIR 2005 SC 1868 (Ref.) 20
1994 AIR SCW 4116 : AIR 1995 SC 94 (Ref.) 20, 26
AIR 1988 SC 1796 (Ref.) 19, 20
AIR 1984 SC 905 (Rel. on) 26
AIR 1982 SC 1057 : 1982 Cri LJ 994 (Ref.) 20
Mahabir Singh, Sr. Advocate, Ajay Pal, Nikhil Jain, Gagan Deep Sharma, Ms. Preeti
Singh and Dilbag Singh (for Sunil Kumar Jain), for Appellant; Anoop C. Choudhari, Ms.
June Choudhari, Sr. Advocates, J. S. Attri, for Respondent.
Judgement
K. G. BALAKRISHNAN, C.J.I. :-This statutory appeal under Section 116A of the
Representation of People Act 1951, is filed by an Election Petitioner against the judgment
dated 7.6.2005 of the Himachal Pradesh High Court dismissing his Election Petition No.1
of 2003 challenging the election of the respondent (Bodh Raj) as Member of Legislative
Assembly from 35-Gangath (SC) Assembly Constituency.
2. The case of the appellant in brief is that 35-Gangath Assembly Constituency is
reserved for scheduled castes, that he and the respondent, among others were candidates
for election from the said constituency. In the said election held on 26.2.2003, the
respondent secured the highest number of votes namely 24499 and was declared as
elected. The respondent had in his nomination paper declared that he belongs to a
scheduled caste (Lohar) and in support of his claim, had produced a caste certificate
dated 16.12.1991 issued by the Executive Magistrate, Indora, District Kangra certifying
that he belonged to scheduled caste of Lohar. Only a few days before the polling, the
appellant learnt that respondent does not belong to Lohar caste but belongs to 'Tarkhan'
caste which is not a scheduled caste in the State of Himachal Pradesh. According to
appellant, the respondent was disqualified to contest the election in the Assembly
Constituency reserved for scheduled caste and therefore, the election of the respondent
was void.
3. The respondent resisted the said election petition. In his written statement, he
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asserted that he belonged to Lohar caste (a Scheduled Caste) and was eligible and
qualified to contest as a candidate for the reserved Assembly Constituency (35-Gangath).
He also contended that he was not served a complete and attested copy of election
petition and therefore, the petition was liable to be rejected.
4. Issues 1 to 3 framed by the High Court (relating to the respondent's contention that he
was not served a complete and attested true copy of the election petition) were treated
and tried as the preliminary issues and held against the respondent by order dated
26.9.2003. Thereafter, evidence was led in regard to the issues (4) to (6) which read thus:
(4) Whether the respondent is not a member of Lohar Caste (SC) and was not qualified
on the date of his election to fill the seat in the Assembly, from reserved Constituency for
SC?
(5) Whether nomination paper of respondent has wrongly and improperly been accepted?
(6) Relief
After appreciating the oral and documentary evidence, the learned Single Judge of the
High Court by judgment dated 7.6.2005 held that the appellant failed to prove that
respondent did not belong to a schedule caste (Lohar) and was not qualified to contest the
election to the assembly seat reserved for scheduled caste. As a consequence, he
dismissed the petition. The said judgment is under challenge in this appeal.
5. It is not in dispute that a person who does not belong to a scheduled caste, cannot offer
himself as a candidate for election to a reserved constituency. Article 173 of the
Constitution prescribes the qualification for membership of the State Legislature and
provides that a person shall not be qualified to be chosen to fill a seat in the legislature of
a State unless he is a citizen of India, not less than 25 years of age, and possesses such
other qualifications as may be prescribed in that behalf by or under any law made by
Parliament. Section 5 of the Representation of People Act, 1951 ('Act' for short) made by
the Parliament prescribes the qualification for membership of a Legislative Assembly. It
provides that a person shall not be qualified to be chosen to fill a seat in the Legislative
Assembly of a State, reserved for the scheduled castes of that State, unless he is a
member of any of those scheduled castes and he is an elector for any Assembly
Constituency in that State. Section 100 of the Act enumerates the grounds for declaring
an election to be void. Clause (a) of sub-section (1) thereof provides that if the High
Court is of the opinion that on the date of his election, a return candidate was not
qualified, or was disqualified, to be chosen to fill the seat under the Constitution or under
the Act, the High Court shall declare the election of the returned candidate to be void.
Thus, if a candidate who contests the election, representing himself by belonging to a
schedule caste, is shown in a proceeding contesting his election, as not belonging to a
schedule caste of the State, his election is liable to be declared as void. Therefore, the
only question that arises for our consideration is whether the appellant had proved that
the respondent does not belong to 'Lohar Caste' - a scheduled caste of the State of
Himachal Pradesh.
6. The appellant had let in oral evidence by examining some residents of the respondent's
village Mohtli - Jagdish Raj (PW7), Satpal (PW8), Joginder Singh (PW9) and Mohal Lal
(PW10) to show that the respondent belonged to 'Tarkhan' caste. He also let in
documentary evidence in the nature of school records (Ex.PW-2/A, Exs.PW-3/A and
3/B), birth register extracts (Exs.PW-6/A, 6/B, and 6/C) and Pariwar Register maintained
by the Gram Sabha (Exs.PW-4/A, 4/B, 4/C and 4/D) to show that the caste of respondent
was 'Tarkhan' and that after 1990 respondent had attempted to represent that his caste as
Lohar. We will first consider the oral evidence.
7. Jagdish Raj (PW7) stated that the respondent's mother and his father were cousins, that
he and respondent belong to Tarkhan caste and are residents of Mohtli village. According
to him, the village has three Mohallas. About ten families of Tarkhan caste and those
belonging to the Rajput caste reside in Jaildar Mohalla. Persons belonging to the
scheduled castes of Chamar, Mahashay, Batwal and Bazigar reside in the Harijan
Mohalla. Brahmins reside in the Brahmin Mohalla. He stated that no one belonging to
'Lohar' caste resided in the village. He also states that respondent's parents were Milkhi
Ram and Giano Devi. He also gave the names of other Tarkhan families in the village
who were the relatives of the respondent. His evidence was rejected
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by the High Court on the ground that the witness had admitted that his grandfather had
worked as a blacksmith and a person who worked as a blacksmith was called as a Lohar
and a person who worked as carpenter was called as Tarkhan and on the ground that he
was not in a position to say the degree of relationship between his father and respondent's
mother, when he claimed that they were cousins.
8. Satpal (PW8), another resident of Mohtli village, stated that respondent was a Tarkhan
by caste, that he knew respondent's father Milkhi Ram as also his relatives who all
belonged to Tarkhan caste and who were displaced persons who had come from Pakistan
and settled in the village Mohtli. He also stated that Mohtli village is divided into three
areas namely Brahman Abadi where Brahamins lived, Jaildar Mohalla where Tarkhan and
Rajput families resided and a separate Mohalla where people belonging to scheduled
castes - Chamar, Mahashay, Batwal and Bazigar resided and that there was no Lohar
family in the village Mohtli. He also stated that except respondent, there was no other
person known as Bodh Raj son of Milkhi Ram in the village Mohtli. The evidence of this
witness was rejected by the High Court on the ground that the witness was able to state
the number of issues of each son and daughter of Milkhi Ram.
9. Joginder Singh (PW9), another resident of Mohtli village, stated that respondent
belonged to Tarkhan caste, that he also knew the respondent's father Milkhi Ram as also
their relatives who all belonged to Tarkhan caste. He also stated that Milkhi Ram had five
children namely three sons (Sat Pal, Yash Pal and Bodh Raj) and two daughters (Satya
Devi and Raj Rani) and the respondent was youngest among the five issues of Milkhi
Ram. He also stated that Tarkhans and Rajputs reside in Jaildar Mohalla, that persons
belonging to scheduled castes of Chamar, Bazigar, Batwal and Mahashay resided in a
separate Mohalla, and Brahmins resided in another separate Mohalla. The evidence of
this witness was rejected on the ground that he was a sympathizer towards BJP party to
which the appellant belonged and therefore, inimical towards respondent who belonged
to Congress Party.
10. Mohan Lal (PW10) who is also a resident of the Mohtli, stated that respondent
belonged to Tarkhan caste and that there was no person other than respondent in the
village who is known as Bodh Raj, son of Milkhi Ram and that no Lohar family resides
in the village Mohtli. His evidence was rejected by the High Court on the ground that he
did not know respondent's father Milkhi Ram and had not stated the occupation of the
respondent's family members.
11. The appellant Desh Raj gave evidence as PW-11. He stated that respondent belonged
to Tarkhan caste and was not qualified to contest the election for a seat reserved for
scheduled castes. He stated that only 4 to 5 days before the polling, he came to know
from his workers that respondent belonged to a backward caste (BC) and not a scheduled
caste. His evidence by the High Court was rejected as he had no personal knowledge
about the caste of the respondent.
12. We may also refer to the evidence of the respondent's witnesses hailing from the
village Mohtli. RW-1 Yash Pal, respondent's elder brother, examined as RW-1 stated that
he and respondent are Lohars by occupation. He also stated that Basaba Ram and Nasib
Chand who are related to him were also Lohars by 'occupation'. In his cross-examination,
he stated that his father Milkhi Ram had five children (three sons and two daughters), that
the respondent was the youngest, that his grandfather's name was Gopi, that he and
respondent studied in the village school, and that respondent was carrying on the business
of scooter repairs. Tilak Raj examined as RW-4 stated that respondent, and his relations
Khazana Ram and Basaba Ram were Lohar by caste as they were doing the job of
Lohars. Ved Prakash (RW-6) stated that respondent and his brothers as also Basaba Ram
and Khazana Ram worked as Lohars and were, therefore, belonged to Lohar caste. He
admitted that he was elected as the Pradhan and respondent was elected as Up Pradhan of
Mohtli Gram Panchayat in the year 1990 that both belonged to congress party. He also
admitted that gram panchayat maintained a register known as Pariwar Register, that
Pradhan of the gram panchayat was the overall custodian of all records and that the
details of all families residing in the panchayat areas including names, age, address, caste
etc., are recorded in the said register. He admitted that in the Ex.PW4/A, the Pariwar
Register relating to the year 1976, the caste of respondent and his family had been shown
as Tarkhan and that then corrected as
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'Lohar'. Ram Singh (RW-7) stated that he knew respondent's father Milkhi Ram and his
three sons including respondent were belonged to Lohar caste. He also stated that he had
seen the members of the respondent's family working as Lohar and therefore, he stated
that he belonged to the caste of Lohar. Bua Butta (RW-8) another resident of Mohtli
village stated that he knew the respondent, that respondent was a Lohar by caste.
According to him, because he used to get agricultural iron implements prepared and
repaired by him, the respondent belonged to Lohar caste. He asserted that except
respondent there is no other Bodh Raj, son of Milkhi Ram in the Mohtli village. Maggai
Singh (RW-11) who is a resident of a neighbouring village of Surajpur stated that he used
to get Lohar's job done from Milkhi Ram, Khazana Ram and Chaina Ram and that 'since
they were working as Lohars, they were Lohars by caste. He also clarified that he had not
enquired about their castes and that it is possible that respondent and his family may be
Tarkhans.
13. What emerges from the aforesaid oral evidence is that while the witnesses examined
by the appellant (PWs 7, 8, 9 and 10), who all belonging to Mohtli village to which
respondent belonged, stated that they knew him and his family well and that he belonged
to Tarkhan caste. The cross-examination of these witnesses (PWs 7, 8, 9 and 10) has not
brought out anything significant to disbelieve their evidence. On the other hand, the
evidence of the witnesses of respondent (RWs 1, 4, 6, 7, 8 and 11) has been to highlight
the occupation of respondent and his relatives. They have all stated that because the
respondent's family and relatives were doing the job of Lohars, they belong to the caste
of 'Lohar'. In fact, the evidence of appellant's elder brother Yash Pal in his short
examination-in-chief, extracted below, is significant :
"I know the respondent. He is my brother. We are Lohars by occupation. Name of my
father is Milkhi Ram. I know Basawa Ram and Nasib Chand also. They are related to me.
They are also Lohars by occupation."
14. We will next consider the documentary evidence. Ex.PW-2/A is the admission and
withdrawal Register of Government Primary School, Mohtli for the relevant period.
Entry at Sl. No.1739 in the said Register shows that Bodh Raj, son of Milkhi Ram,
Labourer (date of birth 2.5.1956; caste: Tarkhan) was admitted on 16.4.1962 to the First
Standard and his name was struck off due to lack of attendance on 11.2.1964. There is
another entry relating to Bodh Raj, son of Milkhi Ram of Mohtli village at Sl. No. 1959.
This entry shows that Bodh Raj, son of Milkhi Ram (date of birth 2.5.1956, caste :
Tarkhan) was admitted to the second standard. The portion of the sheet where the date of
admission was noted is torn and it is however, evident from the other entries in the sheet
that the admission for the second time was made in April, 1964. The entry also shows that
he studied up to 5th standard and completed his education in the school on 31.3.1967.
15. Ex.PW-3/A is the application form for admission given to the Government
Secondary School by Milkhi Ram. It gives the name of the student as Bodh Raj, father's
name as Milkhi Ram, date of birth as 2.5.1956 and the caste as Tarkhan. It contains the
thumb mark of Milkhi Ram. Ex.PW-3/B is the Admission Register of Mohtli Government
Middle School for the period 1962 to 1969. Entry No.778 relates to Bodh Raj son of
Milkhi Ram, Mazdoor, caste Tarkhan. The admission was noted in a page at the top of
which was the date 11.9.1967. As the next page starts with the date 4.4.1968, it is to be
inferred that the admission to the middle school was in the year 1967-68.
16. Ex.PW-6/A is the extract of the Birth Register maintained by the Indora Police Station
(page 376 entry no.27) whose limits include Mohtli village. Ex.PW-6/B is the true
English translation of Ex. PW/6A which is in Urdu. Ex. PW6/C is the certificate of birth.
They relate to the birth of the fifth child of Milkhi Ram (son of Gopi Ram) and Smt.
Giano, on 2.5.1956. The place of residence of the parents is shown as Mohtli and their
caste is shown as Tarkhan. The name of the male child is shown as Bodh Ram. The
registration was made on 16.5.1956, on the report of the Chowkidar.
17. Ex.PW-4/A, Ex.PW-4/B, Ex.PW-4/C and Ex.PW-4/D are the Pariwar Register of
Mohtli Village for the years 1976, 1977, 1982-89 and 1990 onwards. The said register is
maintained as required by the relevant rules relating to Gram Sabhas. In Ex.PW-4/A
relating to the year 1976, the family of Yash Pal is shown as consisting of Yash Pal, his
wife Prem Lata, daughter Guddi and brother Bodh Raj. Under the column 'whether
scheduled caste or scheduled tribe',
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the caste is entered as 'Tarkhan', which is struck off and substituted by the word 'Lohar'
without any attestation regarding correction. In Ex.PW-4/B is the pariwar register relating
to the year 1977, the entry relating to Sat Pal and his family shows that his family
consisted of himself, his wife Kamlesh, his brothers Yash Pal and Bodh Raj and his
children Asha, Nirasha and Sushil Kumar. Under the column 'whether scheduled caste or
scheduled tribe', the caste is entered as 'Tarkhan' which is struck off and substituted by the
words 'Lohar' without any attestation regarding correction. In Ex.PW-4/C which is the
Pariwar register for the year 1982-1989, the entry regarding the family of Sat Pal shows
the family as consisting of himself, his wife Kamlesh, his children Asha, Nirasha and
Sushil Kumar, his brother Yash Pal and his wife Prem Lata and child Guddi and another
brother Bodh Raj. Here again, under the column 'whether scheduled caste or scheduled
tribe', the entry is 'Tarkhan' which is struck off and substituted by the word 'Lohar'
without any attestation regarding the correction. Ex.PW-4/D is the Pariwar register for the
year 1990 onwards and in this register, the family of Bodh Raj is shown as consisting of
himself, his wife Kunti Devi and children Rajiv Kumar and Pankaj Kumar and under the
column 'whether scheduled caste or schedule tribe', the caste is shown as 'Lohar'.
18. The High Court has rejected all these documents as either not proved or not of any
evidentiary value. We may now consider whether they were properly proved.
19. Ex.PW-2/A (admission and withdrawal register of the Government primary school,
Mohtli) was produced by PW-2 (Kamla Kumari) employed in the Government primary
school, Mohtli, in response, summons issued to the said school to produce the said
register. She also gave evidence regarding entries Nos. 1739 and 1959 relating to Bodh
Raj and gave the particulars entered in regard to Bodh Raj under the said two entries. In
her cross-examination, she stated that she has been posted in the said school for the last
two years and that she had not made the said entries. The High Court has rejected the said
School Register on the ground that the said register Ex.PW-2/A and the entries therein
relating to Bodh Raj merely on the ground that PW-2 was not the author of the entries
and she has no personal knowledge about the entries. The High Court relied on the
decision of this Court in Birad Mal Singhvi v. Anand Purohit [AIR 1988 SC 1796].
20

. Section 35 of the Evidence Act provides that an entry in any public or other official
book or register or record, stating a fact in issue or relevant fact and made by a public
servant in the discharge of his official duty or by any other person in performance of a
duty specifically enjoined by law of the country in which such book or register is kept, is
itself a relevant fact. Having regard to the provisions of Section 35, entries in school
admission registers in regard to age, caste etc., have always been considered as relevant
and admissible. [See - : Umesh Chandra vs. State of Rajasthan - 1982 (2) SCC 202 and
State of Punjab v. Mohinder Singh - 2005 (3) SCC 702]. In Kumari Madhuri Patil v.
Addl. Commissioner [1994 (6) SCC 241], this Court observed that caste is reflected in
relevant entries in the public records or school or college admission register at the
relevant time and certificates are issued on its basis. In Birad Mal Singhvi (supra), this
Court after referring to the ingredients of Section 35 held thus : AIR 1982 SC 1057
2005 AIR SCW 1476
1994 AIR SCW 4116

"An entry relating to date of birth made in the school register is relevant and admissible
under Section 35 of the Act, but the entry regarding to the age of a person in a school
register is of not much evidentiary value to prove the age of the person in the absence of
material on which the age was recorded. The entries regarding dates of birth contained in
the scholar's register and the secondary school examination have no probative value, as
no person on whose information the dates of birth of the aforesaid candidates was
mentioned in the school record, was examined. In the absence of the connecting
evidence, the documents produced by the respondent, to prove the age of the aforesaid
two candidates have no evidentiary value."
This Court further held unless the parents, or persons conversant with their date of birth
were examined, the entry in the school register by itself will not have much evidentiary
value. In this case, we are concerned with the 'caste' and not the date of birth. The
residents of a village have more familiarity with the 'caste' of a co-villager, than the date
of birth of the co-villager. Several villagers who knew the respondent and
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their father, including a cousin of the respondent has been examined and they have stated
the caste of the respondent. Appellant has also produced other documentary evidence
which clinch the issue, namely the application made by the respondent's father for
admission of respondent to school, birth register extract and village Pariwar Register
extracts to establish the caste of the respondent. Further the said entries in the school
register were made nearly forty years prior to the election petition. When read with other
oral and documentary evidence, it cannot be said that Ex.PW-2/A has no evidentiary
value even by applying the strict standards mentioned in Birad Mal Sanghvi.
21. We will next refer to Ex. PW3/A and Ex. PW3/B produced by PW-3 Smt. Indersh
Bala, Principal of the Mohtli Senior Secondary School in response to a summons issued
by the High Court. Ex. PW3A is application for admission submitted to the School by
Milkhi Ram, father of Bodh Raj, registered as Sl.No.478. Ex.PW-3/B is the School
Admission Register and entry 778 showed that Bodh Raj son of Milkhi Ram, caste
Tarkhan, was admitted to middle school and had passed 8th standard from the school.
PW-3 stated that the particulars mentioned in the entry were that he was the son of Milkhi
Ram, resident of village Mohtli and that his caste was Tarkhan. In her cross-examination,
she stated that she was working in the said school for the last about one and half years
and has no personal knowledge about the entries made therein. The High Court rejected
both Ex.PW-3/A and PW-3/B on the ground that the date of Ex.PW-3/A was not clear and
can be read as 22.4.1996 or 23.4.1968 and neither of those dates correlated to Ex.PW-3/B
as that showed that admission must have been made between 11.9.1967 and 4.4.1968. It
is evident from Ex.PW-2/A that Bodh Raj left the primary school on 31.3.1967. The date
on which the application for admission was registered was seen as '22.4.196__'. Only
regarding the last figure in the 'year' the Court had a doubt whether it was '6' or '7' or '8' as
that would make the year 1966, or 1967, or 1968. Merely because there was difficulty in
reading one figure in the date cannot be a ground to refuse to accept Ex.PW-3/A. The said
application submitted by Milkhi Ram, containing his thumb mark, being a document
more than 30 years old attracts the presumption under Section 90 of Evidence Act. As
Ex.PW-3/A gives the caste as 'Tarkhan', it has to be treated as clinching evidence. Ex.PW-
3/B which was also produced from proper custody in pursuance of summons issued from
the Court showed that Bodh Raj, son of Milkhi Ram, Tarkhan caste, belonging to Mohtli
village studied upto 8th standard. Here again it should be noticed that the evidence of the
witnesses of both appellant and respondent is that there is only one Bodh Raj, son of
Milkhi Ram in Mohtli village. Therefore, there was no justification to hold that there
were some irreconcilable difference between Ex.PW-3/A and Ex.PW-3/B and rejected
both the documents. Another reason given by the High Court to reject the said evidence is
that Ex.PW-3/B showed that the Bodh Raj had passed the 8th Standard and whereas he
had stated in his cross examination that his qualification is under 'middle'. The High
Court interpreted this as having failed in 8th standard, and considered the said statement
as a contradiction and therefore, an additional ground for rejecting Ex.PW-3/B. The
respondent had been evasive in his evidence about his date of birth and particulars of his
relatives in the village, to avoid being linked to the caste mentioned in the school records.
Therefore, his statement that he was under 'middle' was not a ground to reject the
correction of Ex.PW-3/B. Insofar as the evidentiary value of Ex.PW-3/B, our observation
with reference to Ex.PW-2/A equally apply to Ex.PW-3/B also.
22. We are of the view that the High Court committed an error in ignoring the entries in
the admission and withdrawal registers of the Government primary and middle schools,
Mohtli (Ex. PW-2/A and Ex. PW-3/B). We have already noticed the evidence (of PW8
and RW8) that there is only one Bodh Raj, son of Milkhi Ram in the village of Mohtli.
Respondent does not claim that there was any other Bodh Raj, son of Milkhi Ram in the
village of Mohtli. Respondent, who was examined as RW-5, specifically admits that he
studied in the Government primary school, Mohtli. He gives his age as 48 years in 2004
which corresponds with the age that is entered in the said register. When he was put a
specific question about his date of birth that is 2.5.1956 (which was the date entered in
the said registers), the respondent gave an evasive answer stating that he did not know
whether his date of birth was
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2.5.1956. What is significant is that he did not deny that his date of birth was 2.5.1956. In
fact RW-9 examined by respondent admitted that date of birth of respondent is 2.5.1956.
The admission of the respondent that he was born around 1956 and was a resident of
Mohtli village and studied in the Government primary school, Mohtli, when read with the
school records, prove beyond doubt that the entries in Ex. PW2/A and Ex. PW3/B
referred to above relating to Bodh Raj, son of Milkhi Ram of Mohtli village, Tarkhan
caste, refers to respondent.
23. In response of summons issued by the High Court, PW-6 Naresh Sood working as
Projectionist in the office of CMO, Dharmashala, brought the birth register and
maintained by the Indora Police Station. The relevant entry relating to birth of the fifth
child of Milkhi Ram and Giano of Mohtli village of Tarkhan caste on 2.5.1956 was
marked as Ex.PW-6/A. An English translation of the Urdu extracts was Ex.PW-6/B, and
the certificate as Ex.PW-6/C. The said register and the extract showed the name of the
child as 'Bodhu Ram'. It also shows that the entry was made on 16.5.1956 on the
information given by the, Chowkidar. The High Court rejected the said evidence merely
on the ground that the name of the child was mentioned as 'Buddu Ram' and not as Bodh
Raj. This again is a public record relating to births maintained as per Rules in the usual
course of discharge of official functions. The Punjab Police Rules, 1934 (applicable to
Himachal Pradesh) require maintenance of a Register of Births and Deaths at the Police
Station (vide Rule 22.45 in Chapter XXII relating to Police Station. Rule 22.66 gives the
manner of maintaining such Register. Clause (5) states that birth and death registers shall
be retained at the Police Station for one year after the date of last entry and shall be sent
to the Civil Surgeon for record. The Rule requires the village watchman should diligently
report births and deaths of his village diligently. Therefore the said birth records ought to
have been accepted by the High Court. The High Court has rejected the Birth Extract and
certificate as they relate to Buddu Ram and not Bodh Raj. It is quite possible that the
person who gave information mentioned the name as Buddu Ram instead of Bodh Raj or
that the child was also known as Buddu Ram initially. But what is relevant is that fifth
child of Milkhi Ram and Giano of Mohtli village who belonged to Tarkhan caste was
born on 2.5.1956. It is nobody's case that Milkhi Ram and Giano of Mohtli village had
some other fifth child born on 2.5.1956.
24. In pursuance of summons issued by the Court, Chunni Lal, the Panchayat Secretary
of Gram Panchayat, Mohtli (PW-4) produced the Pariwar register prepared and
maintained as required under the Rules relating to Gram Sabhas. The pariwar registers for
the years 1976, 1977, 1982 to 1989 and 1990 onwards were produced as Exs.PW-4/A,
PW-4/B, PW-4/C and PW-4/D. In Ex.PW-4/A, Bodh Raj was shown as family member of
elder brother Yash Pal. In Exs.PW-4/B and PW-4/C, he was shown as a family member of
elder brother Sat Pal. In all these registers, the family was shown as of Tarkhan caste.
Against the column 'whether scheduled caste or scheduled tribe', the entry was 'Tarkhan'
which was struck off and substituted by the entry Lohar. The correction was not attested.
On the other hand, Ex.PW-4/D relating to the period of 1990 onwards showed the
respondent himself as the head of his family and his caste as Lohar. RW-6, Ved Prakash,
was the Pradhan of the Mohtli Gram Panchayat elected for two terms in 1985 and 1990.
He also had admitted that the Gram Sabha was maintaining a pariwar register containing
the details of all families residing in the panchayat area including their ages, occupations,
castes etc. The suggestion put by respondent (RW-5) and Ved Prakash [RW6] (Pradhan
during 1985-1995 and elected in 1990) was that when respondent became the Up-
Pradhan of the Mohtli Gram Panchayat in 1990, he managed to get the entries in Exs.PW-
4/A, PW-4/B, and PW-4/C, relating to caste namely 'Tarkhan' struck off and substituted
the word 'Lohar'. The suggestion of course was denied. If the substitution was with
reference to the entry in only one register, it could have been explained away as a
mistake. But it is significant that the registers of the years 1976, 1977 and 1982-1989 all
show the caste of the family as 'Tarkhan' and all the entries are struck off and substituted
by the word 'Lohar'. The High Court has refused to rely on Ex. PW4/A, B, C only on the
ground that the entries in the register contained some other corrections and that the
manner in which they were maintained raised a doubt about the probative value of the
document. We are of the view that in the absence of any satisfactory
@page-SC639
explanation of the caste 'Tarkhan' being struck off and substituted by 'Lohar', the
conclusion is that they were all done subsequent to 1990 when respondent became the
Up-Pradhan.
25. The evidence let in by appellant clearly establish the following :
(a) Respondent was born in and is a resident of Mohtli village. His date of birth is
2.5.1956.
(b) Respondent is the last and fifth child of his parents are Milki Ram and Giano.
Respondent is the only 'Bodh Raj', son of Milkhi Ram in Mohtli village.
(c) Respondent was a student of Government primary and middle schools, Mohtli. The
school records show that respondent is the son of Milkhi Ram of Mohtli and his caste was
Tarkhan on the basis of particulars furnished by his father.
(d) In the birth register maintained in the jurisdictional Police Station as per the Punjab
Police Rules, his date of birth was registered as 2.5.1956 and the caste of his parents was
shown as Tarkhan;
(e) That in the Pariwar Registers maintained by the Gram Sabha between 1976 and 1989,
the caste of his family was shown as 'Tarkhan' and that sometime thereafter, it was struck
off and shown as 'Lohar'.
The evidence of the residents of Mohtli village (PWs.7 to 10) support the same. There is
nothing in the cross-examination of PWs.7 to 10 to disbelieve their statements that the
respondent belonged to Tarkhan caste. However, even if we exclude the entire oral
evidence, the documentary evidence produced by the appellant, to which we have
adverted to above, clearly demonstrate that the respondent's father and his family
members including respondent had always held out to be and accepted as persons
belonging to Tarkhan caste. It was only after 1990, the respondent tried to show that he
belonged to Lohar caste.
26

. The learned counsel for the respondent submitted that in view of Ex. PW4/D and
Ex.RW-5A, he should be considered as having established that he belongs to Lohar caste.
Ex. PW-4/D is the Pariwar Register extract for the year 1990 onwards. The same no
doubt shows the caste of respondent as Lohar. But when Ex.PW-4/D is read in
conjunction with PW-4/A, PW-4/B and PW-4/C which are the Pariwar Register extracts
relating to the previous years (1976, 1977 and 1982-1989) where his caste was shown as
Tarkhan and later altered as 'Lohar', the entry in Ex.PW-4/D becomes a self serving
statement. The respondent was elected as the Upa-pradhan of Mohtli Gram Panchayat in
the year 1990 (RW-6, Ved Prakash, belonging to his party was elected as Pradhan). In his
capacity as Upa-pradhan he had access to the records of the Panchayat, and it is obvious
that with the intention of representing himself as belonging to a Scheduled Caste of
Lohar, had ensured that his caste was shown as Lohar in PW-4/D. The alteration of the
entries relating to caste in Exs.PW4/A, 4/B and 4/C, from 'Tarkhan' to 'Lohar' should be
looked at in this background, particularly when it is seen that the correction of caste by
striking out 'Tarkhan' is not only in regard to the family of respondent but also in the case
of some of the relatives of the respondent. In so far as the caste certificate Ex.RW-5/A
issued by the Executive Magistrate, Indora, relied on by respondent, it has to be observed
that such caste certificates are not given after a thorough investigation. When the caste of
respondent is in issue and when primary evidence regarding caste is led by appellant, and
the attempt of respondent to claim to be a 'Lohar' from 1990 is evident, the caste
certificate issued by the Executive Magistrate on 1.12.1991 cannot be taken as evidence
to prove the caste of the respondent. The decision of this Court in R. - Palanimuthu v.
Returning Officer [1984 (Supp.) SCC 77], supports this position. In Madhuri Patil
(supra), this court observed that when the school records show a particular caste, the caste
certificates issued to the candidates and his relatives by the Executive Magistrate showing
a different caste should be ignored. Reference was also made to the caste certificate of
two relatives. But they are also of the period subsequent to 1990 when respondent started
showing that he belonged to Lohar caste. They have to be ignored as observed by this
Court in Madhuri Patil (supra). AIR 1984 SC 905
1994 AIR SCW 4116

27. In view of the above, we are of the view that the appellant has clearly established that
the respondent and his family belong to Tarkhan caste which is not a scheduled caste in
Himachal Pradesh. It is also clear that from around 1990, the respondent has made efforts
to show his caste
@page-SC640
as 'Lohar', a scheduled caste. Consequently, we hold that the respondent who did not
belong to a Scheduled Caste, was not qualified to be chosen to fill a seat in the
Legislative Assembly reserved for Scheduled Castes.
28. Therefore, we allow this appeal, set aside the judgment of the High Court and declare
the election of the returned candidate (Bodh Raj) from 35-Gangath Assembly
Constituency in the 2003 Election, to be void. Parties to bear their respective costs.
Appeal allowed.
AIR 2008 SUPREME COURT 640 "Y. N. Gangadhara Setty v. J. P. Reddy"
Coram : 2 TARUN CHATTERJEE AND DALVEER BHANDARI, JJ.
Contempt Petn. (C) No. 222 of 2006 In Spl. Leave Petn. (C) No. 24199 of 2005, D/- 2
-11 -2007.
Y. N. Gangadhara Setty and Ors. v. Jaya Prakash Reddy, M. D., Karnataka Co-operative
Milk Producers Federation.
Contempt of Courts Act (70 of 1971), S.14, S.2 - CONTEMPT OF COURT -
ACQUISITION OF LAND - SUPREME COURT - SPECIAL LEAVE PETITION -
COMPROMISE - Wilful disobedience of order of Court - Acquisition of land belonging
to Company - By Government Order sanction was accorded to reconvey disputed land in
favour of Company - Special Land Acquisition Officer entered into a compromise and
agreed to reconvey 2 acres 5 guntas of land in their favour before Supreme Court -
However, terms of compromise were not complied with by State Govt. and on contrary
buildings were constructed on the said land - Company filed various litigations for
repossession of land but in vain - In Special Leave Petition filed by contemner Supreme
Court again directed compliance of compromise - Said order was also not complied with
by contemner - In instant Contempt Petition Supreme Court again directed respondent to
hand-over possession without any loss of time - Cost of reconstruction of existing
buildings directed to be valued by an independent Government approved valuer. (Paras
23, 24)

Arun Jaitley, Mukul Rohatgi, Sr. Advocates, Gopal Jain and Ms. Ruby Singh Ahuja, for
Appellants Uday Holla, Sr. Advocate, Varun Thakur, Hage Lampu and A. S. Bhasme, for
Respondent.
Judgement
1. DALVEER BHANDARI, J. :-This case has a chequered history. It is alleged that
despite orders of this Court in Civil Misc. Petition No.5513 of 1972 in Civil Appeal
No.514 of 1971 dated 30th August, 1972, (about 35 years ago) there has been a wilful
disobedience and defiance of the order of this Court. It is further alleged that there is also
non-compliance of order dated 5th December, 2005 passed by this Court in SLP (C)
No.24199 of 2005.
2. Brief facts which are relevant to dispose of this contempt application are recapitulated
as under:-
The applicants M/s. Y. S. Setty and Sons were the owners of land admeasuring 20 acres
and 3 guntas which was acquired by the State of Karnataka on 19.1.1961 under the Land
Acquisition Act. The disputed land bearing Survey No.76/2 measuring 2 acres and 5
guntas being part of the total land.
3. The applicants filed several representations in the year 1962-63 before the Government
of Karnataka for recovery of only 2 acres 5 guntas in survey No.76/2 in favour of Y. S.
Setty and Sons out of the total land acquired by the contemnor. On 15.5.1962, the
applicants M/s. Y. S. Setty and Sons received compensation of land. An appeal was filed
before the High Court seeking enhancement of compensation. The High Court allowed
the appeal in part. The Special Land Acquisition Officer challenged the order of the High
Court before this Court by way of a special leave petition.
4. On 15.9.1967 vide Government Order No. RD 74 LGB 67, sanction was accorded to
reconvey the disputed land in favour of the applicants Y. S. Setty and Sons by the State
Government subject to fulfilling of certain conditions.
5. On 14.10.1969, the Land Acquisition Officer wrote to the State Government informing
that the disputed land has been reconveyed in the name of Y. S. Setty and Sons and the
final order was awaited from the State Government.
6. The Special Land Acquisition Officer entered into a compromise in Civil Appeal
No.514 of 1971 with M/s. Y. S. Setty and Sons and agreed to reconvey 2 acres 5 guntas of
land in their favour. Pursuant to the compromise reached between the parties, this Court
decreed the appeal in terms of compromise between the parties. The relevant portion of
the order dated 30th August, 1972 reads as under:-
@page-SC641
"The Application for recording compromise above-mentioned being called on for hearing
before this Court on the 30th day of August, 1972. Upon perusing the said application
and the terms of Compromise and upon hearing Mr. R.B. Datar, counsel for the petitioner
residing appellant herein and Mr. K.N. Bhatt, counsel for the respondent, the Court took
on record the said terms of compromise and by and with the consent of the parties herein,
the court decreed the appeal in respect of 2 acres and 5 guntas of land out of 15 acres and
18 guntas of the land in Survey No.76/2 Adugodi Village in terms of the said terms of
compromise annexed thereto as Schedule 'A'."
7. It is alleged that despite the orders passed by this Court in a compromise petition, the
possession of the land was not handed over to the applicants Y. S. Setty and Sons or their
predecessors-in-title.
8. The firm Y. S. Setty and Sons was dissolved on 31.12.1973. The legal heirs and
successors-in-interest of Y. S. Setty and Sons made various representations before the
State Government to reconvey the disputed land in their favour but the same were of no
avail as the Government has not handed over the possession till date. Instead of giving
the possession, the contemnor herein made construction over the disputed land.
9. The erstwhile partners and successors-in-interest of the applicants Y. S. Setty and Sons
filed a writ petition bearing Writ Petition No.4276 of 1995 before the High Court seeking
directions to the contemnor herein to comply with the order dated 30.8.1972 passed by
this court and to direct the State Government to comply with the government order dated
15.9.1967.
10. The applicants herein filed suit OS No.6969/1999 before the City Civil Court at
Bangalore for reconveyance of the scheduled/disputed property. The court granted
interim injunction in favour of plaintiff on 15.2.2000.
11. The contemnor herein challenged the said order before the High Court in MFA
No.1189/2000. The High Court vide order dated 11.4.2000 vacated the interim injunction
and directed the trial court to dispose of the suit untrammeled with the observations made
in the judgment.
12. The applicants herein filed a special leave petition against the order dated 11.4.2000
and filed an interim application in Civil Appeal No.514 of 1971 seeking reconveyance
and delivery of the disputed land. This court vide common order dated 03.12.2001
dismissed the special leave petition and directed the trial court to expedite the hearing of
the suit, if possible within six months. This Court further disposed of the interlocutory
application filed and recorded the statement made by the State Government that "......the
government has executed the conveyance deed. "
13. The State Government executed reconveyance deed dated 31.5.2001 in favour of the
applicants herein by the Deputy Commissioner, Bangalore for the disputed land. In spite
of the execution of the reconveyance deed, the State Government did not hand over
possession of the land to the applicants herein. This attitude of the State Government
compelled the applicants to file a writ petition before the High Court bearing No.18166
of 2002.
14. The learned Single Judge vide Order dated 31.3.2004 allowed the writ petition and
directed as under:-
"Direction is issued to the KMF to restore possession of the schedule land measuring 2
acres 5 guntas in Survey No.76/2 of Audigodo Village, Bangalore, South Taluk, bounded
on the east by Sy.No.76/1, West by 76/2, north by 76/3 and south by Bangalore Hosur
Road, within three months from today."
15. The learned Single Judge had recorded that the contemnor herein, i.e., Karnataka
Milk Federation have, ".....no right whatsoever in respect of the scheduled property, has
no right to resist delivery of possession pursuant to the deed of sale executed by the State
Government in favour of the petitioners." The Court further held that
"The KMF being an instrumentality of the State shall not come in the way of the State
Government in honouring its commitment made in the compromise petition filed before
the Supreme Court, much before the KDDC came into existence."
16. The Court also recorded that, The KMF proceeded to put up construction contrary to
the directions issued by the State Government to deliver possession of the scheduled land
to the petitioners. Further, the KMF being aware of all the above narrated facts proceeded
to put up construction. This Court in the MFA (1189/2000)
@page-SC642
referred to above has observed that the KMF cannot plead any equity in its favour in the
event it has been proceeded to put up construction. The suit filed by the petitioners is also
disposed of since the State Government itself has reconveyed the property under the
registered deed dated 31.5.2001. This Court also disposed of the SLP (C) No.9309/2001
and the application filed in SLP No.514/71 taking into consideration the subsequent
development of the Government reconveying the property in favour of the petitioners
(applicants herein)........ "Therefore, in considered view of the Court the petitioners were
entitled for possession of the scheduled land from the KMF."
17. The contemnor aggrieved by the order dated 31.3.2004 filed a writ appeal before the
Division Bench of the High Court. The Division Bench vide order dated 13.7.2005
dismissed the appeal and held as under:-
"Even though several contentions were raised before the learned Single Judge, the
learned Single Judge considering the fact that a compromise was entered into between the
parties before this Court, the appellant cannot go back from the same. It was contended
before the learned Single Judge that the State Government had no authority to enter into a
compromise because the land when once acquired and handed over to Bangalore Dairy, it
cannot be de-notified and given back to the owners. That contention has been rightly
rejected by the learned Single Judge. The Government of then State of Mysore acquired
the land for the Bangalore Dairy which was a wing of the State Government at that time.
The appellant Corporation had not come into existence at that time. The acquisition was
therefore for itself. Therefore, the Government had rightly agreed for the compromise
before this Court. Hence, there was nothing wrong in the Government agreeing to de-
notify the land which was acquired earlier. The present appellant which came into
existence later on in place of the earlier Bangalore Dairy cannot question what had been
done by the State Government in their own interest before this Court. The Division Bench
therefore did not see any error committed by the learned Single Judge in rejecting the
contention of the appellant."
18. The contemnor herein filed a special leave petition against the order dated 13.7.2005
passed by the learned Division Bench. The special leave petition was dismissed by this
Court vide order dated 5.12.2005. This Court held as under :
"We do not find any ground to interfere with the order. The SLP is dismissed
accordingly."
19. Thereafter, the applicants through their advocates sent a legal notice dated 17.1.2006
and called upon the contemnor herein to comply with the orders dated 30.8.1972 and
5.12.2005 passed by this Court. The contemnor addressed a letter dated 25.1.2006 to the
applicants herein and has merely made an offer to give possession of the land which is
neither the scheduled land nor adjoining to the scheduled land.
20. The applicants thereafter had sent another letter dated 6.2.2006 through their advocate
and again called upon the contemnor to comply with the orders dated 30.8.1972 and
5.12.2005 passed by this Court and to deliver possession of 2 acres and 5 guntas of land
as per the compromise reached between the parties before this Court. The contemnor-
federation herein through its advocate addressed another letter dated 14.2.2006 to the
advocate of the applicants herein and reiterated the offer made in the letter dated
25.1.2006.
21. In the contempt petition, it is alleged that the contemnor had made all attempts to
avoid compliance of the orders of this Court and made every efforts to circumvent and
over-reach the orders passed by this court.
22. It may be pertinent to mention that the Map which has been annexed with this petition
shows that initially the contemnor had agreed to hand-over 2 acres 5 guntas of land from
the portion marked as "A". The contemnor-federation herein showed its inability to give
that portion, therefore, the applicants herein YS Setty and Sons had agreed to take 2 acres
5 guntas of land, as per Map shown in Schedule B which the contemnor agreed to give to
the applicants.
23. We have heard learned counsel for the parties at length and we find considerable
merit in this application. On consideration of the totality of the facts and circumstances,
we direct the respondent-federation to hand-over possession of 2 acres 5 guntas, as per
annexed Map shown as Scheduled "B" without any loss of time.
24. We further direct that the cost of the reconstruction of the existing buildings shall
@page-SC643
be valued by an independent Government approved valuer within two weeks from today.
The re-construction cost so fixed shall be deposited within a week from the report of the
valuer.
25. The respondent-federation will be entitled to demolish the buildings within 8 weeks
from the date of deposit and shall hand over vacant possession of the area of 2 acres 5
guntas as per Schedule "B". The original re-conveyance deed shall be rectified within
four weeks of handing over vacant, peaceful and physical possession by the respondent-
federation.
26. In case there is non-compliance of the orders of this Court, the court will take very
serious view of the matter and pass appropriate orders.
27. The contempt petition is disposed of accordingly.
Order accordingly.
AIR 2008 SUPREME COURT 643 "Prabha Arora v. Brij Mohini Anand"
(From : 2007 (4) ALJ 404 (Utr)
Coram : 2 A. K. MATHUR AND MARKANDEY KATJU, JJ.
Civil Appeal No. 2371 of 2007, D/- 31 -10 -2007.
Prabha Arora and Anr. v. Brij Mohini Anand and Ors.
U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act (13 of 1972),
S.21(1)(a) - EVICTION - TENANCY - APPEAL - TRUST - Eviction of tenant - Sought
by landlady, a retired teacher getting meager pension to open tutorial center - Application
for release of premises allowed - Appeal - During its pendency Trust was created in
respect of property in question - Purpose mentioned in application for release under S. 21
was not for doing charitable work - Held, need for which eviction of tenant was sought
totally disappeared.
2007 (2) ALJ 404 (Utr), Reversed.
AIR 1961 SC 1023, and AIR 1981 SC 1113, Foll. (Paras 4, 8, 9)
Cases Referred : Chronological Paras
2004 AIR SCW 5789 : 2004 All LJ 3892 5
AIR 1981 SC 1113 (Foll.) 7
AIR 1981 SC 1711 5
AIR 1961 SC 1023 (Foll.) 6
Dinesh Dwivedi, Sr. Advocate, P. N. Gupta, for Appellants; M. N. Krishnamani, S. C.
Maheshwari, Sr. Advocates, Ms. J. Quddisi, Vipul Maheshwari, M. P. S. Tomer, Ms.
Sandhya Goswami, for Respondents.
Judgement
1

. MARKANDEY KATJU, J.:- This appeal has been filed against the judgment dated
09.10.2006 passed by the Uttaranchal High Court in Writ Petition No. 337 of 2004 (M/S).
Heard learned counsel for the parties and perused the records. reported in 2007 (2)
ALJ 404

2. The appellants before us are the tenants of the premises in dispute while the
respondents are the landlords. The landlady filed the petition under Section 21 (1) (a) of
the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972. The
grounds mentioned in the release application of the landlady was that she is a retired
teacher getting only a pension of Rs. 538/- per month which is insufficient for her needs.
Hence to augment her income she wants to run tuition/coaching classes in the premises in
question. The said petition was rejected by the Prescribed Authority, but in appeal the
Appellate Authority (ADJ Dehradun) by his judgment dated 16.03.2004 reversed the
order of the Prescribed Authority and allowed the release application.The said judgment
dated 16.03.2004 has been upheld by the High Court by the impugned judgment dated
09.10.2006. Hence this appeal.
3. It may be mentioned that during the pendency of the appeal before the Appellate
Authority a Trust was created in respect of the property in question vide trust deed dated
04.08.2003 (copy of which is annexed as Annexure P-8 to this appeal).
4. Learned counsel for the appellants, Shri Dinesh Dwivedi, submitted that in view of the
aforesaid trust deed dated 04.08.2003 the very purpose for which eviction was sought of
the tenants through the release application has disappeared. We are in agreement with this
submission.The trust deed nowhere mentions that any income of the Trust will be given
to the petitioner who filed the release application. In fact, Section 51 of the Trust Act
debars a trustee from using the trust property for his own profit.

. In Kedar Nath Agrawal (dead) and Anr. v. Dhanraji Devi (dead) by LRs. and Anr. [2004
(8) SCC 76] this Court held that the court has to consider the changed circumstances
2004 AIR SCW 5789

@page-SC644
during the pendency of the litigation. This decision relied on the earlier decision of this
Court in Hasmat Rai v. Raghunath Prasad [1981 (3) SCC 103: AIR 1981 SC 1711] in
which it was observed that where possession is sought for personal requirement, the said
requirement must not only exist on the date of the filing of the petition but must also
subsist till the final decree for an order for eviction is made. If, in the meantime, events
crop up which would show that the landlord's requirement no longer subsists then the
action must fail.
6. In Tulsidas Kilachand and Ors. v. Commissioner of Income Tax [AIR 1961 SC 1023] it
was held that on creation of a Trust the property passes to the trustees. Hence, in our
opinion, rent is now to be paid to the trustees who will collect it on behalf of the Trust.
7

. In M.M. Quasim v. Manohar Lal Sharma and Ors. [1981 (3) SCC 36] this Court held
that on transfer of property to a person who is not a party to the proceedings the suit for
eviction will fail. AIR 1981 SC 1113

8. Learned counsel for the respondents, Shri M.N. Krishnamani, submitted that the
petition under Section 21 for eviction was filed on the ground that the petitioner wanted
to do charitable work, and after creation of the Trust also the purpose remains the same.
We do not agree. In the petition under Section 21 it is stated in paragraph Nos. 3-7 of the
petition that the petitioner has a monthly pension of Rs. 538/- only and she wants to
augment her income as it is difficult for her to survive on the meager pension. Hence she
wants to open a tutorial centre in the premises in dispute to earn some money. The
purpose mentioned in the petition under Section 21 was not for doing charitable work.
However, after the execution of the trust deed the premises in dispute now belongs to the
Trust. The need mentioned in the petition under Section 21 has totally disappeared.
9. In this view of the matter, the impugned judgment of the High Court dated 09.10.2006
and of the Appellate Authority dated 16.03.2006 cannot be sustained and are set aside.
10. Appeal is allowed, no order as to costs
Appeal allowed.
AIR 2008 SUPREME COURT 644 "L. P. Shashi Kumar v. Industrial Development Bank
of India Ltd."
(From : Andhra Pradesh)
Coram : 2 Dr. A. R. LAKSHMANAN AND ALTAMAS KABIR, JJ.
Civil Appeal No. 644 of 2007 (arising out of SLP (C) No. 9949 of 2006), D/- 8 -2 -2007.
L. P. Shashi Kumar v. Industrial Development Bank of India Ltd. and Ors.
Constitution of India, Art.133 - APPEAL - LOAN - SUPREME COURT - BANKING -
Appeal - Directions by Court - Settlement of term loan - Guarantor deposited amount
with Bank as directed by Supreme Court towards full and final settlement of dues of
Bank - Bank directed to release securities to guarantor - Bank also directed to withdraw
writ petition filed before High Court as also the guarantor to withdraw case filed before
State Consumer Commission.(Para 6)

G. Bikshapathy, Sr. Advocate, Ms. T. Anamika and A. Chandra Mohan, for Appellant;
Sanjay Bhatt and Amit Kumar, for Respondents.
Judgement
Dr. AR. LAKSHMANAN, J. :-Leave granted.
2. Heard Mr. G. Bikshapathy, learned senior counsel appearing on behalf of the appellant
and Mr.Sanjay Bhatt, learned counsel appearing on behalf of the contesting respondent
No.1 (Industrial Dev. Bank of India Ltd.).
3. This appeal was filed against the order passed by the High Court of Andhra Pradesh
dated 27.04.2006 in W.P.No.7951 of 2006 and W.P.M.P.No.10172 of 2006. The High
Court was approached by the first respondent herein against the direction given by the
A.P. State Consumer Disputes Redressal Commission directing release of security to the
appellant herein. The High Court stayed the operation of the order dated 06.04.2006
passed by the A.P. State Consumer Disputes Redressal Commission, Hyderabad in CDIA
No.33/2006 (CD No.1/2006). When the matter came up for admission before this Court
on 19.06.2006, this Court passed the following Order :-
"Issue notice returnable within six weeks.
In the meanwhile, the operation of the impugned order passed by the High Court in
WPMP No. 10172/2006 in WP No.7951/2006 dated 27.04.2006 shall remain stayed.
In the meantime, either the principal
@page-SC645
debtor or the guarantor are at liberty to deposit the money with the bank so that this Court
may consider the prayer for return of share certificates and title documents to the
petitioner-guarantor. This direction is issued since the GTL is ready to pay the
outstanding principal amount of Rs.4.80 crores along with 9% interest per annum from
December, 2003."
4. By Order dated 31.10.2006, the main Special Leave Petition itself was directed to be
listed for final hearing. Today, when the matter is taken up for hearing, learned senior
counsel appearing on behalf of the appellant placed before us a communication dated
01.02.2007 addressed to the Deputy General Manager, Industrial Development Bank of
India Limited, Hyderabad. The said communication reads thus :-
"Date : 01-02-2007
To
The Deputy General Manager,
Industrial Development Bank of India Limited,
Main Branch,
Hyderabad - 500 001
Dear Sir,
Sub.:-Full and Final Settlement of Term Loan of Rs.1000 lacs.
Ref.:- 1) Our Term Loan account GOLT0101100,
GOLT0101101 and GOLT0101102
2) - Your letter bearing No. IDBI(H) No.5278/CFD(GTL)
With reference to the above-cited subject, please find enclosed Cheque bearing
No.672421 for Rs.54,22,237.00, drawn on M/s. UCO Bank, Abid Circle Branch, towards
full and final settlement of Term Loan referred in (1) above.
We request yourselves to acknowledge the receipt of the abovesaid payment, issue letter
towards full and final settlement of the said Term Loan and release all charges created on
the assets of our company, personal guarantees executed by the management of our
company in favour of IDBI, release pledge of 15,00,000 equity shares of Goldstone
Technologies Ltd., held by Goldstone Exports Ltd. and any other securities/sureties
executed in this regard.
Thanking you
Yours truly,
For Goldstone Technologies Ltd.
Sd/-
D.P. Sreenivas
Executive Director"
5. The learned senior counsel for the appellant has also placed before us a communication
by way of reply to the communication dated 01.02.2007 sent to the Managing Director,
Goldstone Technologies Ltd. The said letter reads thus :-
"IDBI(H) No./CFD(GTL) February 3, 2007
The Managing Director,
Goldstone Technologies Ltd.,
Amarchand Sharma Complex,
S.D.Road, Secunderabad - 500 003.
Dear Sir,
Rupee term loan of Rs.1000 lakh - Settlement of dues
Please refer to your letter dated February 1, 2007 forwarding a cheque for Rs. 54,22,237/-
(Rupees fifty four lakh twenty two thousand two hundred thirty seven only) towards full
and final settlement of dues of IDBI. In this connection, we advise that on receipt of the
aforesaid payment, there are no dues from the company to IDBI and the term loan
account of Rs.1000 lakh stands fully repaid. We, therefore, advise you to arrange to
withdraw the cases pending before the A.P. State Consumer Disputes Redressal
Commission, Hyderabad and Hon'ble Supreme Court of India to enable us to release the
securities etc. at the earliest.
Yours - faithfully,
Sd/-
(V. V. Rao)
Dy. General Manager"
6. It is thus seen that in compliance of the Order of this Court dated 19.06.2006, the
guarantor deposited the money with the first respondent. Since the sum of Rs. 54,22,237/-
(Rupees Fifty four lakh twenty two thousand two hundred thirty seven only) has been
paid by the appellant to the first respondent-bank towards full and final settlement of the
dues of IDBI, the IDBI has requested the appellant herein to withdraw the cases pending
before the A.P. State Consumer Disputes Redressal Commission, Hyderabad and in this
Court to enable them to release the securities at the earliest. In view of the payment of Rs.
54,22,237/- made by the appellant towards full and final settlement of the dues of IDBI,
the said bank is directed to release the securities to respondent No.3 (Goldstone
Technologies Ltd.) forthwith. In view of the final payment now received by IDBI, there is
nothing further
@page-SC646
survives for the bank to pursue the Writ Petition No.7951/2006 filed by them before the
High Court. Therefore, the IDBI is directed to withdraw the said Writ Petition from the
High Court. Likewise, the appellant is also directed to withdraw the case filed by them
before the A.P. State Consumer Disputes Redressal Commission, Hyderabad
immediately. The zerox copies of the letter dated 01.02.2007 and 03.02.2007 are placed
on record and will form part of this Order.
7. We make it clear that the deposit of sum of Rs. 54,22,237/- now made by the appellant
is in addition to the sum of Rs. 89,96,636/- deposited by the guarantor pursuant to our
interim order dated 19.06.2006 in full and final settlement of the bank dues.

8. The appeal stands disposed of accordingly.


9. No costs.
Order accordingly.
AIR 2008 SUPREME COURT 646 "Rabindra Kumar Shaw v. Manick Lal Shaw"
(From : Calcutta)*
Coram : 2 Dr. A. PASAYAT AND LOKESHWAR SINGH PANTA, JJ.
Civil Appeal No. 4926 of 2007 (arising out of SLP (C) Nos. 19179 and 19180 of 2005),
D/- 22 -10 -2007.
Rabindra Kumar Shaw (D) by L.Rs. v. Manick Lal Shaw.
Civil P.C. (5 of 1908), O.39, R.1, R.2 - DECLARATION OF TITLE - INJUNCTION -
POSSESSION - Suit for declaration of title and permanent injunction - Application by
plaintiff for interim injunction restraining defendant from interfering with possession of
plaintiff and from taking forcible possession - Rejection of, on ground of non-
impleadment of three sons of defendant in suit - Subsequently on application by plaintiff,
three sons of defendant impleaded in suit - In view of changed circumstances, matter
remitted to trial Court for fresh consideration. (Para 5)

Tapash Ray, Sr. Advocate, Bijan Kumar Ghosh and S. K. Poddar, for Appellants; Jaydeep
Gupta, Satyajit Salia, Mrs. V. D. Khanna and Rajkumar Laholi, for Respondent.
* F.M.A. No. 1471 of 2005, D/- 23-3-2005 (Cal)
Judgement
1. Dr. ARIJIT PASAYAT, J. :- Leave granted.
2. Challenge in these appeals is to the order passed by a Division Bench of the Calcutta
High Court allowing the appeal filed by the respondent-Manick Lal Shaw. The appeal
was filed by the respondent who was the defendant in the suit for declaration of title and
permanent injunction. The same was directed against the order dated 4th December, 2004
passed by learned Judge, 10th BENCH, City Civil Court at Calcutta in Title Suit No. 815
of 2000 thereby rejecting the application under Order 39, Rule 4 of the Code of Civil
Procedure, 1908 (in short the 'CPC') filed by the defendant and allowing the application
under Order 39, Rules 1 and 2 filed by the plaintiffs.
3. During the pendency of the suit, application in terms of Order 39, Rules 1 and 2, CPC
was filed praying for an order of injunction and restraining the defendant from interfering
with the possession of the plaintiff in the suit property and from taking forcible
possession by breaking open the padlock in the suit property. On such application,
learned trial Judge granted ad interim order of status quo. Against such order the
defendant filed an appeal before the High Court which was heard by a Division Bench
and the said Division Bench did not interfere with the order as the main application for
injunction was yet to be decided on merits. Plaintiff filed an application under Section
151 of CPC for enforcing the said ad interim order of status quo with the help of police
and the learned trial Judge allowed the application. The defendant filed a revision before
the High Court but the High Court did not interfere with the said order on the ground that
so long as the ad interim order was subsisting there was no reason for interference with
the order for implementation of the order. Subsequently, an application under Order 39,
Rule 4, CPC was filed by the defendant for vacating the earlier interim order. The High
Court noted that it would have normally remitted the matter to learned trial Judge for
consideration of the application under Order 39, Rule 4, CPC and the written objection
filed to the original
@page-SC647
application for injunction on merits. But it was pointed out that in the suit, plaintiff had
not impleaded the three sons of the defendant who had admittedly become co-owners of
the property along with the defendant and as such no effective order of injunction can be
passed in the suit in the absence of all co-owners of the property. The High Court,
therefore, held that in the circumstances it was a fit case where application for injunction
filed by the plaintiff was to be dismissed in the absence of necessary parties to the suit
and on that ground alone the application was dismissed. The High Court noted that it had
not gone into the merits of the case and only on the technical ground as noted above, the
application for temporary injunction was rejected. In view of the dismissal of the appeal
the application No. CAN 1209/2005 had become infructuous.
4. During hearing of the appeal, learned counsel for the appellants who are the legal heirs
of Rabindra Kumar Shaw, the original plaintiff submitted that the High Court had not
decided the case on merits and had passed the impugned order only on the technical
ground that the three sons of the defendant who are co-owners had not been impleaded.
As a matter of fact subsequently an application in terms of Order 1, Rule 10(2) read with
Section 151, CPC was filed by the plaintiff on 8-11-2005 for impleading the three sons of
the defendant. The prayer was accepted by the trial Judge by order dated 19-4-2005.
5. As the basic objection as to the maintainability of the application no longer survives in
view of the impleadment of the three sons of the defendant, the matters need to be heard
afresh. As noted above, the High Court noted that it had not gone into the merits of the
case and except on the technical ground of non-impleadment of the three sons of the
defendant, the application for temporary injunction was rejected. In view of the changed
circumstances we remit the matter to the trial Court to consider the matter afresh. The
effect of the impleadment of the three sons of the defendant, needless to say, shall be
considered by the trial Court.
6. The appeals are accordingly disposed of. There will be no order as to costs.
Order accordingly.
AIR 2008 SUPREME COURT 647 "State of Tamil Nadu v. Seshachalam"
(From : Madras)*
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Civil Appeal Nos. 1938 with 1940 to 1942, 1944, 1946, 1947, 1949, 1950, 1952, 1954,
1955, 1957, 1958 and 1960 of 2007, D/- 18 -9 -2007.
State of T.N. v. Seshachalam.
Constitution of India, Art.226, Art.14, Art.16 - WRITS - EQUALITY IN PUBLIC
EMPLOYMENT - SERVICE MATTERS - Delay and laches - 'One unit' system for all
departments of Secretariat of State Govt. - Finance and Law Departments, however,
excluded from 'one unit' system - No challenge as to, filed by any aggrieved employee
from 'one unit' - Notification No. 126, D/- 29-5-1998 providing for up-gradation of post
and stepping up pay of employees of 'one unit' accordingly, on par with their juniors in
Finance Department - Applications by some employees who were retired long back prior
to Notification of 1998, for stepping up their pay in view of Notification - Liable to be
dismissed on ground of delay.
W. P. No. 7971 of 2004, D/- 21-4-2006 (Mad), Reversed.
Delay or laches is a relevant factor for a Court of law to determine the question as to
whether the claim made by an applicant deserves consideration. Delay and/or laches on
the part of a Govt. Servant may deprive him of the benefit, which had been given to
others. Art. 14 would not, in a situation of that nature, be attracted, as it is well known
that law leans in favour of those who are alert and vigilant. Moreover, legitimate
expectation is a part of the principles of natural justice. No fresh right can be created by
invoking the doctrine of legitimate expectation. By reason thereof only the existing right
is saved subject, of course, to the provisions of the statute. (Para 11)
Where there existed 'one unit' system for promotion of employees in all departments of
Secretariat, however, the Finance and Law Departments were excluded from such 'one
unit' system and such different treatment meted out to Finance and Law Departments
where employees junior to those serving in other department got promotion on fortuitous
circumstances, was never questioned
@page-SC648
by employees of other departments, by filing representations or by filing applications
before Administrative Tribunal and for the first time after Notification GOMS 126, D/-
29-5-1998 providing for up-gradation of pay of senior employees revised on or before
28-1-1994 in 'one unit', on par with their juniors in Finance Department, application for
the up-gradation of their pay accordingly, was filed by the employees who were retired
long back prior to Notification D/- 29-5- 1998, such applications were liable to be
dismissed on ground of delay in filing same. In such a case, only because a cut- off date
was fixed, the same per se cannot be said to be arbitrary as some date was required to be
fixed for that purpose.
W. P. No. 7971 of 2004, D/- 21-4-2006 (Mad), Reversed.
Moreover, the notification envisaged a personal pay by way of stepping up of pay. It was
given the prospective effect. No arrear of pay was to be paid. The upgradation sanctioned
was to lapse in the event of retirement of the individuals or their promotion to the
upgraded post. The said up-gradations were to be subject to the terms and conditions
contained in Cl. 12 of the said order, a reading whereof would clearly, lead to only one
conclusion that it was meant to be applied to the existing employees. It would, therefore,
be incorrect to construe that the notification applied to all who had been recruited to the
Tamil Nadu Secretariat Service on or before 28-1-1994. The Court should not give a
strained or extended meaning thereto. While construing such a notification, the financial
impact thereof is also required to be taken into consideration. (Paras 14, 15)
Cases Referred : Chronological Paras
2007 AIR SCW 77 : 2007 Lab IC 991 : 2007 (2) AIR Kar R 34 (Foll.) 12
2007 AIR SCW 672 : AIR 2007 SC 924 : 2007 (2) ALJ 242 (Foll.) 12
2007 AIR SCW 1705 : AIR 2007 SC 1365 (Foll.) 12
2007 AIR SCW 3752 : AIR 2007 SC 1984 (Foll.) 13
2006 AIR SCW 2676 : AIR 2006 SC 2145 : 2006 (4) AIR Kar R 194 (Disting.) 20
2006 AIR SCW 3889 : AIR 2006 SC 2844 : 2006 Lab IC 3301 : 2006 (5) AIR Kar R 434
15
2005 AIR SCW 6045 : AIR 2006 SC 407 : 2006 Lab IC 137 (Foll.) 15
(2005) 1 SCC 625 (Foll.) 13
(2004) 1 SCC 347 (Foll.) 12
1998 AIR SCW 186 : AIR 1998 SC 591 13
1997 AIR SCW 3839 : AIR 1997 SC 3910 : 1997 All LJ 2202 13
(1997) 3 SCC 398 13
1992 AIR SCW 1247 : AIR 1992 SC 1277 : 1992 Lab IC 1371 (Foll.) 11
1991 AIR SCW 704 12
(1987) 4 SCC 31 16
AIR 1983 SC 130 : 1983 Lab IC 1 12
AIR 1974 SC 1 : 1974 Lab IC 1 (Disting.) 19
AIR 1952 SC 75 : 1952 Cri LJ 510 (Disting.) 17
(1896) 165 US 150 17
M. S. Ganesh, Sr. Advocate, V. G. Pragasam, S. Joseph Aristotle and S. Prabu Rama-
subramanian, for Appellant; Dr. A. E. Chelliah, R. Venkatramani, Sr. Advocates, Ms.
Vasanthakumari Chelliah, K. Ramanujam, Ms. A. Annapurai, Dinesh Kumar Garg, R.
Anand Padmanabhan, Pramod Dayal, Mrs. S. Lesi and Namachivayam (for P. Nara-
simhan), for Respondent; Caveator-in-person.
* W.P. No. 7971 of 2004, D/- 21-4-2006 (Mad).
Judgement
1. S. B. SINHA, J. These appeals involving identical questions of law and fact were taken
up for hearing together and are being disposed of by this common judgment.
2. Respondents herein have been working in the Secretariat of the Government of Tamil
Nadu. Each and every department in the Government Secretariat prior to 1961 had a
separate unit for appointment, promotion etc. The State, however, amended the Special
Rules in the year 1961 whereby all the departments in the Secretariat were made the "one
unit" for the purpose of appointment and promotion. Appointments in the Secretariat at
all entry level posts, i.e., Junior Assistants (subsequently re-designated as Assistants),
Assistants (subsequently re-designated as Assistant Section Officers), Typist/Personal
Clerks were to be made from the common list of candidates selected by the Tamil Nadu
Public Service Commission. Promotion to different higher posts in different departments
was also being made from amongst those employees. The Government of Tamil Nadu,
however, by issuing G.O.Ms. No.1290, dated 05.06.1970 excluded the Finance and Law
Departments from the "one unit" system. Whereas posts in the cadre of Assistants,
Assistant Section Officers, Typists/Personal Clerks continued to be filled up from the
common list of candidates, but in Finance and Law Departments, further promotions
@page-SC649
were effected from amongst the employees allotted thereto only. Appointments to
Finance Department, however, were made at random and probably in terms of the option
exercised by any particular candidate. Many persons, who have, thus, been ranking
higher were employed in "one unit" departments whereas some of the candidates ranking
lower were employed under fortuitous circumstances in the Finance Department. The
employees working in the Finance Department, therefore, obtained promotions much
ahead of their peers or even seniors who were discharging their duties in other
departments coming within the "one unit".
3. G.O.Ms. No.3288 (Public Services Department) was thereafter issued on 29.10.1971
specifying Finance and Law Departments as separate units from the level of
Superintendent (Section Officer) and above. Admittedly, however, Rule 4 of the Special
Rules of the Tamil Nadu Secretariat Service was amended in that behalf. The said policy,
however, is said to have been implemented. Two employees, S. Kalaiselvan and S.
Sivasubramanian, filed an Original Application before the Tamil Nadu Administrative
Tribunal in the year 1990 claiming promotion and scale of pay at par with those who
were working in the Finance Department and who were said to be juniors to them but had
been promoted to higher posts in Finance Department. The said Original Application was
allowed by the Tribunal by an order dated 16.4.1993 opining that there existed no
guidelines to allot any employee to the Finance Department, vis-a-vis, other departments
and, thus, the employees working in other departments could not have been deprived of
the benefit of promotion. It was furthermore pointed out that even Rule 4 of the Special
Rules for the Tamil Nadu Secretariat Service had not been amended by the said GOMs
No.1290 dated 05.06.1970.
4. The Government of Tamil Nadu thereafter amended the Service Rules with
retrospective effect from 05.06.1970 by issuing G.O.Ms. No.30 Personnel and
Administrative Reforms (D) Department, dated 28.1.1994. Upon issuance of the said
Government Order, an application for review was filed but the same was dismissed by the
Tribunal by an order dated 30.1.1995. The Government was thereafter advised to
implement the order of the Tribunal by giving promotion to the concerned employees
with retrospective effect from the date on which their juniors had been promoted as
Assistant Section Officers in the Finance Department. Sanction was also accorded for
creation of two supernumerary posts, namely, posts of Assistant Section Officers in the
respective departments. Several representations thereafter were made by persons said to
be similarly situated claiming promotion and parity in the scale of pay as compared to
their counterparts in the Finance Department. A large number of Original Applications
were also filed before the Tamil Nadu Administrative Tribunal. Upon consideration of
various pros and cons, the Government of Tamil Nadu issued a GOM bearing No.126,
dated 29.5.1998, relevant paragraphs whereof read as under :
"10. The Government accordingly direct that :-
(i) the pay of the seniors in One Unit who have been recruited to the Tamil Nadu
Secretariat Service on or before 28.1.1994, shall be stepped up on par with their juniors in
the Finance unit by upgrading the posts held by them to the scale of pay applicable to the
juniors with immediate effect.
(ii) The stepping up of their pay on par with the juniors in the Finance Unit by upgrading
the posts held by them to the scale of pay applicable to the junior ordered in sub-para (1)
above is purely a person-oriented upgradation and no new posts will be created for this
purpose.
(iii) The upgradation sanctioned for the seniors will lapse in the event of the retirement of
the individuals concerned or their promotion to the upgraded post in their normal turn.
(iv) The pay of the other seniors in the One Unit in the same cadre will be stepped up on
par with immediate juniors in the Finance Unit, with effect from the date of issue of this
order.
(v) In respect of the Typists/Personal Clerks/Personal Assistants, in One Unit who have
not relinquished their right for promotion as Assistant Section Officer, and are still
awaiting their turn for promotion as Assistant Section Officer, their pay shall be upgraded
to Assistant Section Officer scale on par with their immediate junior in the Finance Unit
who got his promotion as Assistant Section Officer.
11. The benefits of upgradation of pay of the seniors on par with their juniors as per
@page-SC650
Commission's Seniority list ordered in sub-paras (i) to (iv) of Para 10 above, shall also be
extended to those seniors in the Finance Unit who were recruited before 28.1.1994 and/or
drawing less pay than their juniors in One Unit.
12. The upgradation ordered above is subject to the following terms and conditions :
(1) The upgradation ordered will involve only stepping up of pay of the senior on par
with his junior in the upgraded scale of pay.
(2) It does not entitle him to any claim for arrears of pay.
xxx xxx xxx
These orders shall come into force with effect from the date of issue of the orders.
13 ...
14. The Departments of Secretariat concerned shall issue necessary orders for
upgradation of posts and for stepping-up of the pay of the Seniors in One Unit in the
upgraded scales ordered in para 10 above, after obtaining necessary individual
undertaking in the format enclosed from the seniors concerned to the effect that they
accept the terms and conditions of this order."
5. The said Government Order further stipulated that undertaking should be given by the
seniors getting upgradation of their pay with their juniors in the Finance Department in
the format enclosed to the effect that they accept the terms and conditions thereto.
Respondents before us, save and except R. Ragothaman in CA No.1955 of 2007
indisputably had retired much prior to issuance of the said Government Order dated
29.5.1998. They also made representations before the appellant demanding fixation of
their pay at par with their juniors in the Finance Department. As the said request was not
acceded to, a large number of original applications were filed before the Tamil Nadu
Administrative Tribunal. By a common judgment pronounced on 20.1.2004, the Tribunal
dismissed the said applications opining that the same were barred by limitation. It was
held that the applicants having retired long back and having filed applications between
1998 to 2003 and the promoters having retired as Under Secretaries, Deputy Secretaries
and Joint Secretaries and in some cases as Additional Secretaries, they should have raised
the dispute long back when their juniors had been given promotions in the Finance
Department and as the original applications were filed after 20 years, the same could not
be entertained.
6. Aggrieved by the said order of the Tribunal, respondents filed writ petitions before the
High Court of Judicature at Madras. By reason of the impugned judgment dated
21.4.2006, a Division Bench of the High Court, inter alia, held that the cause of action for
filing the original application arose only upon issuance of GOMs No.126, dated
29.5.1998 and in that view of the matter it cannot be said that the original applications
filed by the respondents suffered from delay and laches and/or otherwise barred by
limitation as GOMs No.126 applied also in respect of those who had retired before
29.5.1998. It was also opined that the respondents who had not been in service on or
before 28.1.1994 came within the scope and ambit of the said GOMs. Although GOMs
126 provided for operation with prospective effect and by reason thereof past benefits
were not made available, the same should be construed in consonance with the provisions
contained in Article 14 of the Constitution of India, holding :
"There is no specific clause in G.O.Ms. No.126 excluding the applicability of this G.O. to
the persons who had retired before 29.5.1998. The G.O. itself recites that the Government
wanted to provide a solution to the long standing problem and had decided to take a
sympathetic view to effect lasting and equitable solution to the long standing issue so as
to redress the grievances of the seniors in the One Unit by upgrading the pay of the
seniors in One Unit on par with their immediate juniors in the Finance Unit.
Keeping in view the explicit intention of the Government, it is apparent that the G.O. had
been issued as a beneficial measure and the provisions in such G.O. are to be liberally
construed so as to benefit the employees for whose benefit the G.O. was avowedly
issued. It is not disputed that the petitioners were in service on and before 28.1.1994 and,
therefore, they fall within the scope and ambit of the impugned G.O. Once they are
covered under the said G.O., the benefit of the said G.O. will flow automatically."
It was further held that the said Government Order applied not only to the existing staff
but also to the retired employees and as such a beneficial interpretation to the said
@page-SC651
Government Order should be given as the said provisions have to be read in consonance
with Article 14 of the Constitution of India.
7. Mr. M. S. Ganesh, learned senior counsel appearing on behalf of the appellants, would
submit that the High Court committed a serious error in passing the impugned judgment
in so far as it failed to take into consideration that :
(i) no explanation was offered by the respondents for not preferring the claim petitions
prior to or immediately after the announcement of the order dated 16.04.1993;
(ii) the High Court committed serious error in interfering with the finding of fact arrived
at by the Tribunal;
(iii) doctrine of legitimate expectation does not postulate conferment of any right which
has been lost for any reason whatsoever; and
(iv) as in terms of Articles 14 and 16(1) of the Constitution, no employee has any
fundamental right of promotion, upgradation, allocation of any particular department or
to receive any benefit after superannuation the impugned judgment is unsustainable.
8. Mr. Venkataramani, Dr. A.E. Chelliah, senior counsel appearing on behalf of
respondents and caveator-in-person on the other hand contended that :
(i) from the perusal of the order of Tribunal dated 16.04.1993, it would appear that
observations made therein were not confined only to the two employees who had filed the
original application but covered the cases of all others similarly situated;
(ii) having regard to the fact that the State was required to respond comprehensively to
the said observations and that the review application filed by the State in view of the said
order has been dismissed, before issuing the GOMs No.126, dated 29.5.1998, the State
must be held to have considered the ground realities as also the plight of those employees
who had suffered discrimination, irrespective of the fact as to whether they were in
service or had retired.
(iii) GOMs No.126, dated 29.5.1998 must be given effect to for stepping up the scale of
pay of the employees to bring them at par with their juniors in the Finance Department
with the object of treating all the employees equally;
(iv) no new right having been created by GOMs No.126, dated 29.5.1998, any mini
classification or micro classification would offend Article 14 of the Constitution of India
as there was no rational object behind the same and it is not possible to segregate the
cases of the employees in service vis-a-vis the retired employees.
9. The employees of the Finance and Law Departments were being treated differently
from a long time. The respondents herein never questioned the purported different
treatment meted out to them by the State either by making representations or by filing
any application before the Central Administrative Tribunal. Only two of the employees
did. Their applications were allowed, inter alia, on the premise that posting of employees
in the Finance and Law Departments took place by way of fortuitous circumstances and
were not supported by any rationality. The State, we have noticed hereinbefore, amended
the Rules with retrospective effect. The said Rule is still in force. Validity of the said Rule
has not been questioned by the respondents. Different treatments meted out to the
employees of the Finance and Law Departments vis-a-vis other department is now
covered by Rules, but despite the same, the State intended to assuage the feelings of the
employees by issuance of the said GOMs No.126, dated 29.5.1998. The said notification
was issued upon considering various factors including pendency of a large number of
matters before the Administrative Tribunal on the said issue. The State intended to lay
down a policy for providing financial benefits with prospective effect. Various pros and
cons therefor were examined. Avenues available to the State were taken to into
consideration. Only thereafter it was directed :
"The Government, after careful consideration of all these points and also the related
issues involved, have decided to take a sympathetic view and attempt a lasting and
equitable solution to this long standing issue, so as to redress the grievances of the seniors
in the One Unit, by upgrading the pay of the seniors in One Unit on par with their
immediate juniors in the Finance Unit."
10. It is one thing to say that the State had come up with a policy decision which is
beneficial to all the employees irrespective of the fact as to whether they had reached the
age of superannuation or not, the only criteria being that they were recruited to the
@page-SC652
Tamil Nadu Secretariat Service on or before 28.1.1994 but it is another thing to say that
the claim petitions filed by the responders were based on the success of their colleagues
before the Administrative Tribunal in the year 1994. The employees working in the
Finance Department had been promoted long back. We have noticed hereinbefore that
some of them retired as Additional Secretaries whereas the respondents retired as merely
Assistants. Presumably, promotions to the employees of the Finance Department were
given systematically over a long period of time but no such grievance was made nor any
application was filed before the appropriate forum. Such grievance, in our opinion,
should have been raised or proper application before the Tribunal should have been filed
long long back. It was in the aforementioned situation, the Tribunal was of the opinion
that their applications were barred by limitation. Assuming that the cause of action for
filing such applications arose in view of the observations made by the Tribunal in its
order dated 16.4.1993 passed in Original Application No.166 of 1990, but then in terms
of the Act and the Rules, the respondents were required to file a proper application within
a period of one year only. It is borne out from the records that, in fact, 62 such
applications were already pending when GOMs No.126 was issued.
11

. Some of the respondents might have filed representations but filing of representations
alone would not save the period of limitation. Delay or laches is a relevant factor for a
court of law to determine the question as to whether the claim made by an applicant
deserves consideration. Delay and/or laches on the part of a Government servant may
deprive him of the benefit which had been given to others. Article 14 of the Constitution
of India would not, in a situation of that nature, be attracted as it is well known that law
leans in favour of those who are alert and vigilant. Opinion of the High Court that GOMs
No.126, dated 29.5.1998 gave a fresh lease of life having regard to the legitimate
expectation, in our opinion, is based on a wrong premise. Legitimate expectation is a part
of the principles of natural justice. No fresh right can be created by invoking the doctrine
of legitimate expectation. By reason thereof only the existing right is saved subject, of
course, to the provisions of the statute. {See State of Himachal Pradesh and Anr. v.
Kailash Chand Mahajan and Ors. [1992 Supp (2) SCC 351]}. 1992 AIR SCW 1247

12. We may notice that in Government of West Bengal v. Tarun K. Roy and Ors. [(2004)
1 SCC 347], this Court held :
"The respondents furthermore are not even entitled to any relief on the ground of gross
delay and laches on their part in filing the writ petition. The first two writ petitions were
filed in the year 1976 wherein the respondents herein approached the High Court in 1992.
In between 1976 and 1992 not only two writ petitions had been decided but one way or
the other, even the matter had been considered by this Court in Debdas Kumar (supra).
The plea of delay, which Mr. Krishnamani states, should be a ground for denying the
relief to the other persons similarly situated would operate against the respondents.
Furthermore, the other employees not being before this Court although they are
ventilating their grievances before appropriate courts of law no order should be passed
which would prejudice their cause. In such a situation, we are not prepared to make any
observation only for the purpose of grant of some relief to the respondents to which they
are not legally entitled to so as to deprive others therefrom who may be found to be
entitled thereto by a court of law." 1991 AIR SCW 704

See also Chairman, U.P. Jal Nigam and Anr. v. Jaswant Singh and Anr. [2006 (12)
SCALE 347] and New Delhi Municipal Council v. Pan Singh and Ors. [2007 (4) SCALE
204]. 2007 AIR SCW 672
2007 AIR SCW 1705

Only because a cut-off date has been fixed, the same per se cannot be said to be arbitrary
as some date is required to be fixed for that purpose.

Recently, this Court in K.S. Krishnaswamy etc. v. Union of India and Anr. [2006 (12)
SCALE 307] held : 2007 AIR SCW 77, (Para 21)
AIR 1983 SC 130

"Nakara's case (supra) was a case of revision of pensionary benefits and classification of
pensioners into two groups by drawing a cut-off line and granting the revised pensionary
benefits to employees retiring on or after the cut- off date. The criterion made applicable
was "being in service and retiring subsequent to the specified date". This Court held that
for being eligible for
@page-SC653
liberalised pension scheme, application of such a criterion is violative of Article 14 of the
Constitution, as it was both arbitrary and discriminatory in nature. It was further held that
the employees who retired prior to a specified date, and those who retired thereafter
formed one class of pensioners. The attempt to classify them into separate classes/groups
for the purpose of pensionary benefits was not founded on any intelligible differentia,
which had a rational nexus with the object sought to be achieved. The facts of Nakara's
case (supra) are not available in the facts of the present case. In other words, the facts in
Nakara's case are clearly distinguishable."
13. In Bannari Amman Sugars Ltd. v. Commercial Tax Officer and Ors. [(2005) 1 SCC
625], a Division Bench of this Court, as regards applicability of doctrine of promissory
estoppel, opined :
"In order to invoke the doctrine of promissory estoppel clear, sound and positive
foundation must be laid in the petition itself by the party invoking the doctrine and bald
expressions without any supporting material to the effect that the doctrine is attracted
because the party invoking the doctrine has altered its position relying on the assurance of
the Government would not be sufficient to press into aid the doctrine. The Courts are
bound to consider all aspects including the results sought to be achieved and the public
good at large, because while considering the applicability of the doctrine, the Courts have
to do equity and the fundamental principles of equity must for ever be present in the mind
of the Court.

20. In Shrijee Sales Coporation and Anr. v. Union of India (1997 (3) SCC 398) it was
observed that once public interest is accepted as the superior equity which can override
individual equity the principle would be applicable even in cases where a period has been
indicated for operation of the promise. If there is a supervening public equity, the
Government would be allowed to change its stand and has the power to withdraw from
representation made by it which induced persons to take certain steps which may have
gone adverse to the interest of such persons on account of such withdrawal. Moreover,
the Government is competent to rescind from the promise even if there is no manifest
public interest involved, provided no one is put in any adverse situation which cannot be
rectified. Similar view was expressed in Pawan Alloys and Casting Pvt. Ltd., Meerut etc.
etc. v. U.P. State Electricity Board and Ors. (AIR 1997 SC 3810 ) and in Sales Tax
Officer and Anr. v. Shree Durga Oil Mills and Anr. (1998 (1) SCC 573) and it was further
held that the Government could change its industrial policy if the situation so warranted
and merely because the resolution was announced for a particular period, it did not mean
that the Government could not amend and change the policy under any circumstances. If
the party claiming application of the doctrine acted on the basis of a notification it should
have known that such notification was liable to be amended or rescinded at any point of
time, if the Government felt that it was necessary to do so in public interest." 1997
AIR SCW 3839
1998 AIR SCW 186

{See also Southern Petrochemical Industries Co. Ltd. v. Electricity Inspector and E.T.I.O.
and Ors. [(2007) 5 SCC 447]. 2007 AIR SCW 3752

14. Interpretation of GOMs No.126 would, no doubt, depend upon the backdrop of the
events in which it was made but it is trite that the intention of the maker of the policy
must be drawn from the language used therein. For the said purpose, the entire document
should be read in its entirety. Original Application No.166 of 1990 was filed by two
serving employees. The State could in obedience to the Tribunal's order create two
supplementary posts and promote them thereto so as to treat them at par with their juniors
working in the Finance Department. The Notification envisages a personal pay by way of
stepping up of pay. It was given the prospective effect. No arrear of pay was to be paid.
The upgradation sanctioned was to lapse in the event of retirement of the individuals or
their promotion to the upgraded post. The said upgradation were to be subject to the
terms and conditions contained in clause 12 of the said order, a reading whereof would
clearly, in our opinion, lead to only one conclusion that it was meant to be applied to the
existing employees. By reason thereof, on upgradation, the seniors were required to
continue to perform the duties attached to the existing post till they get their normal
promotion to the next higher category. Upgradation of their posts was further dependant
on the fact as to whether they had been promoted in their normal course only. It was
meant to be a
@page-SC654
one time affair. In respect of some categories of employees, the question of upgradation
was deferred as specified in paragraph 12(6).
15

. It would, in our opinion, therefore, be incorrect to construe that the notification applied
to all who had been recruited to the Tamil Nadu Secretariat Service on or before
28.1.1994. Additional benefits have been accorded by reason of the said notification. A
person who fulfills the conditions, thus, would be entitled to the benefits provided for
therein. Those who had not fulfilled the same could not claim any benefit thereunder. For
the said purpose, the Court, in our view, should not give a strained or extended meaning
thereto. While construing such a notification, the financial impact thereof is also required
to be taken into consideration. {See State of A.P. and Anr. v. A.P. Pensioners' Association
and Ors. [(2005) 13 SCC 161] and Union of India and Anr. v. Manik Lal Banerjee
[(2006) 9 SCC 643]}. 2005 AIR SCW 6045
2006 AIR SCW 3889

16. Reliance placed by the learned counsel on R.L. Marwaha v. Union of India and Ors.
[(1987) 4 SCC 31] is misplaced. This Court in the said decision was considering validity
of a subordinate legislation whereby retrospective effect was granted. It was not a case
where pensionary benefit was granted to a class of employees. The benefit was meant to
be accorded to the existing employees only.
17

. Reliance has been placed by Mr. Venkataramani on the following passage of The State
of West Bengal v. Anwar Ali Sarkar [(1952) 3 SCR 284] : AIR 1952 SC 75

"The learned Attorney-General, appearing in support of these appeals, however, contends


that while a reasonable classification of the kind mentioned above may be a test of the
validity of a particular piece of legislation, it may not be the only test which will cover all
cases and that there may be other tests also. In answer to the query of the Court he
formulates an alternative test in the following words : If there is in fact inequality of
treatment and such inequality is not made with a special intention of prejudicing any
particular person or persons but is made in the general interest of administration, there is
no infringement of Article 14. It is at once obvious that, according to the test thus
formulated, the validity of State action, legislative or executive, is made entirely
dependent on the state of mind of the authority. This test will permit even flagrantly
discriminatory State action on the specious plea of good faith and of the subjective view
of the executive authority as to the existence of a supposed general interest of
administration. This test, if accepted, will amount to adding at the end of Article 14 the
words "except in good faith and in the general interest of administration." This is clearly
not permissible for the Court to do. Further, it is obvious that the addition of these words
will, in the language of Brewer, J., in Gulf, Colorado and Santa Fe Railway Co. v. W. H.
Ellis (165 US 150), make the protecting clause a mere rope of sand, in no manner
restraining State action. I am not, therefore, prepared to accept the proposition
propounded by the learned Attorney-General, unsupported as it is by any judicial
decision, as a sound test for determining the validity of State action."
This Court therein was dealing with the provisions of the West Bengal Special Courts
Act. The said decision, in our opinion, has no application with the facts and
circumstances of this case, particularly, when in the said decision itself, it has been
pointed out that Article 14 does not insist that every piece of legislation must have
universal application and it does not take away from the State the power to classify
person for the purpose of legislation.
18. As to what, therefore, is necessary for this purpose is that classification must be
rational and in order to pass the test : (1) the classification must be founded on an
intelligible differentia, and (2) the differentia must have a rational relation to the object
sought to be achieved by the Act.
19

. Equally misplaced is the decision of this Court in The State of Jammu and Kashmir v.
Shri Triloki Nath Khosa and Ors. [(1974) 1 SCC 19], wherein this Court, inter alia, held
that educational qualification can be held to be a criteria for valid classification for
different scales of pay. Justice V. R. Krishna Iyer, held : AIR 1974 SC 1

"The social meaning of Articles 14 to 16 is neither dull uniformity nor specious


'talentism'. It is a process of producing quality out of larger areas of equality extending
better facilities to the latent capabilities of the lowly. It is not a methodology of
substitution of pervasive and slovenly mediocrity for activist and intelligent - but not
@page-SC655
snobbish and uncommitted - cadres. However, if the State uses classification casuistically
for salvaging status and elitism, the point of no return is reached for Articles 14 to 16 and
the Court's jurisdiction awakens to deaden such manoeuvres. The soul of Article 16 is the
promotion of the common man's capabilities, over-powering environmental adversities
and opening up full opportunities to develop in official life without succumbing to the
sophistic argument of the elite that talent is the privilege of the few and they must rule,
wriggling out of the democratic imperative of Articles 14 and 16 by the theory of
classified equality which at its worst degenerates into class domination."
20. Reference has also been made by Mr. Venkataramani to a decision of this Court in
U.P. Raghavendra Acharya and Ors. v. State of Karnataka and Ors. [2006 (6) SCALE 23]
wherein it was held that pension is not a bounty and it is a deferred salary. This Court is
not concerned herein with such a situation. In the said decision, this Court was concerned
with a case where an employee retiring on a particular date was to receive 50% of the
pension on the enhanced salary. In the fact situation obtaining therein that as the revision
of pay and consequent revision in pension had come into force and by reason of a
notification, the modality of computing the pension was required to be determined, those
who had fulfilled the conditions laid down therein were held to be entitled to the benefits
provided for thereunder holding that the concerned employees had a vested right therein.
21. For the reasons aforementioned, we regret to express our inability to agree with the
view of the High Court. The impugned order of the High Court is, therefore, set aside.
The appeals are allowed. In the facts and circumstances of the case, however, there shall
be no orders as to costs.
Appeals allowed.
AIR 2008 SUPREME COURT 655 "Election Commission of India v. St. Mary's School"
(From : Delhi)
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Civil Appeal No. 5659 of 2007 (arising out of SLP (C) No. 21963 of 2004), D/- 6 -12
-2007.
Election Commission of India v. St. Mary's School and Ors.
(A) Constitution of India, Art.324 - Representation of the People Act (43 of 1950), S.29 -
Representation of the People Act (43 of 1951), S.159 - ELECTION - SUPREME COURT
- Holding of election - Utilising services of teachers in school - Supreme Court directed
that all teaching staff shall be put on duties of roll revisions and election works on
holidays and non-teaching days - Teachers should not ordinarily be put on duty on
teaching days and within teaching hours - Nonteaching staff, however, may be put on
such duties on any day or at any time, if permissible in law. (Para 32)
(B) Constitution of India, Art.324, Art.21A - Representation of the People Act (43 of
1950), S.29 - Representation of the People Act (43 of 1951), S.159 - ELECTION -
Holding of election - Utilising services of teaching staff in school during school timings -
Provisions of 1950 and 1951 Acts though enacted in terms of Art. 324 - Must be given
restricted meaning - Holding election is of paramount importance - But for this purpose
education of children cannot be neglected - Balance between two is to be maintained.
The provisions of the 1950 and 1951 Acts although were enacted in terms of Article 324
of the Constitution of India, the same must be given restricted meaning. Holding of an
election is no doubt of paramount importance. But for the said purpose the education of
the children cannot be neglected. Therefore, it is necessary to maintain the balance
between the two. With an advent of technology requisitioning of a large number of people
for carrying out the election may not be necessary. The Election Commission has
different roles to play. Preparation of an electoral rolls, revision of electoral rolls, when
objections are filed, hearing the parties and determining the objections, enumeration of
the voter list and to hold elections as and when due. The Election Commission and its
officers can formulate an effective scheme to see that the services of a large number of
teachers are not required. The State admittedly is not in a position to perform its
sovereign function of imparting education. Such functions necessarily are required to be
performed by the private sectors. Those students who are in a position to get admission in
the public schools presumably would also be in a position to appoint tutors whereas those
students who are admitted to the Government schools

@page-SC656
ordinarily would be from the middle or lower middle class or poor families. The state of
primary education in India is in deplorable condition. There admittedly is a heavy drop
outs from the schools particularly from amongst the girl schools. If right to exercise
franchise is an important one, right to education is also no less important being a
fundamental right. (Paras 27, 28)
(C) Constitution of India, Art.133 - APPEAL - Appeal - Question in regard to application
of constitutional right and in particular fundamental right - Cannot be thwarted only by
reason of a concession made by a counsel. (Para 31)
Cases Referred : Chronological Paras
1995 AIR SCW 1095 : AIR 1995 SC 1078 (Ref.) 20
1993 AIR SCW 863 : AIR 1993 SC 2178 (Ref.) 23, 24
1992 AIR SCW 2100 : AIR 1992 SC 1858 (Ref.) 22, 23
AIR 1984 SC 802 23
(1954) 98 Law Ed 873 : 347 US 483 26
K. K. Venugopal, Sr. Advocate, Ms. Meenakshi Arora, S. K. Mendiratta, S. Gupta and
Ankur Talwar, with him, for Appellant; R. K. Shukla, Sr. Advocate, Ms. Reena George,
Prashant Bhushan, D. S. Mahra, Ms. Rashmi Malhotra, Ms. Indira Sawhney, Mrs. Anil
Katiyar, Sanjiv Sen and Praveen Swarup, with him, for Respondents.
Judgement
1. S. B. SINHA, J. :-Leave granted.
2. A short but interesting question, as to how conflict in two constitutional rights should
be balanced, is involved in this appeal which arises out of a judgment and order dated
11.08.2004 passed by a Division Bench of the Delhi High Court in Writ Petition (Civil)
No. 1076 of 2003.
3. Respondent No.1 is an unaided school. It is governed by the provisions of the Delhi
School Education Act, 1973 (for short, 'the Act') and the rules framed thereunder. It filed
a writ petition in public interest, questioning the action of the appellant and the
respondent Nos. 2 to 5 herein as regards utilizing the services of the teachers of the
Government schools for various purposes during school timings, as a result whereof the
students reading in the said schools are deprived of obtaining instructions from their
teachers during such period. In the writ petition it was pointed out that the absence of
teachers occur due to their deployment for non-educational purposes; and as the teaching
and administrative staff of these schools have been used by the State agencies as well as
the appellant herein for various other duties outside school during school hours including:
lPolling duties to general election to Lok Sabha
lPolling duties to general election to Delhi Legislative Assembly
l Polling duties to MCD elections
lGurudwara election
lRevision of polling lists
lPulse polio drive
lPreparation of census lists
lSurveys on malaria, pollution etc.
4. The Act and the Rules framed thereunder which govern the field mandate that all the
schools in Delhi have to function for a minimum of 210 days in a year. It was pointed out
that although the extent of the period differed, the teachers were asked to perform polling
duties for a few months and also for census duties for considerable period. The writ
petition highlighted that absence of teachers from the school for a long time resulted in
unfinished courses, high drop out rates, poor results and inability to compete in open
examinations, such as medicine, engineering etc. and/or to get admission in other
prestigious or professional colleges. It was contended that an informal survey conducted
by the petitioner therein demonstrated that about 9,00,000 students had enrolled
themselves in class 1 of the schools run by the Municipal Corporation of Delhi, but only
50,000 of them appeared in the secondary examination.
5. The Municipal Corporation of Delhi (MCD) in its counter-affidavit contended that
absence of the teachers and other administrative staff of schools for performing duties
allocated by the officers of the Election Commission is in national interest. In the
counter-affidavit, it was, stated:
"3. That the main work assigned to teachers is in relation to teaching work. However, in
the larger national interest, some of the teachers are called upon to do some other
Government work relating to public interests like polio vaccination, preparation of voter
list, etc.
4. That only during the work of census in the year 2001, a slightly large number
@page-SC657
of teachers were required for the purpose. Even for this purpose, to take care that the
teaching activities are not hampered in any manner, letter No. F-4/12/2000, dated
04.02.01, referring to the Order of Lt. Governor of the NCT of Delhi having been passed,
whereby the enumerators were directed to perform their census enumeration duties
before/after their normal school hours. The census work is conducted only once in a
decade.
5. That it is reiterated that it is seen that the government work relating to public interest
done by the teachers does not hamper the teaching activities. The additional government
public work is some time assigned to some of the teachers in national interest."
6. The New Delhi Municipal Committee (NDMC) in its additional affidavit filed before
the High Court, stated :
"2. That the total number of sanctioned posts of teachers in NDMC Schools are about
1200. For polling duty, almost 90% of the teaching staff is deployed on duty. For census
work in the year 2000 and enumeration work in the year 2001, 90% of the staff were
assigned duty. For Revision of electoral rolls, almost 50% of the teaching staff is put on
duty.
3. For polling duties, the Election Commission deploys the teachers of the NDMC
Schools for the purposes of holding Parliamentary Elections, Delhi Assembly Elections
and even Municipal Corporation Elections. Generally the elections are held on Sundays,
but before the actual polling takes places, the teaching staff is called for three working
days for the purposes of training, collection of election material etc. In the year 1998-99,
all the elections were held i.e. Parliamentary, Delhi Assembly and Corporation Elections
and hence the teachers were not on duty for 9 working days.
4. That in the year 2001, when the work of Special Revision of Electoral Roll was
required to be conducted, the then Chief Electoral Officer informed the Respondent
NDMC that the said work shall be conducted by the teachers between 13.9.2001 to
12.10.2001 by the teachers. Initially it was supposed to be a part time job, however, it
was later on converted into a full time work so as to complete the assignment within the
prescribed time."
7. During the pendency of the writ petition before the High Court, the Government of
NCT of Delhi issued a circular letter, relevant portion whereof is as under - :
"This duty binds the State-Governments to provide the requisite number of staff to the
Election Commission for conducting elections and taking into consideration the
insufficient number of staff available in generalist cadre, the government proposes to
utilize the services of teaching staff for the following duties :
(a) Election Duty
(b) Revision of Electoral Rolls
(b) Revision of Electoral Rolls : For the intensive revision of electoral rolls, we require
approximately 55,000 employees whereas the Cadre strength of the General cadre of the
Govt. of NCT of Delhi is only around 9000. In view of this, the services of teachers are
indispensable for intensive Revision of Election Rolls. This intensive revision of electoral
rolls is not a regular process and this takes place with a periodicity of 4 to 5 years as per
instructions of the Election Commission of India.
The Summary/Special Revision of Electoral Rolls takes place once in a year and the
services of teachers are normally not utilized and this is managed within the cadre
strength. However, in some of the institutions that are declared as designated locations,
the services of the Head of the Institution are taken to receive the Form and they are
declared as Designated Officers. Normally, these officials are not engaged in teaching and
handle the work in addition to their administrative duties. They are assisted by non-
teaching staff.
The Staff thus deployed function under the superintendence and control of the Chief
Electoral Officer and remain under the administrative control of Chief Electoral Officer
during this period.
Elections being a sovereign function of the State, the work of conduct of elections cannot
be delegated to persons who are not employees of government or to any non-
governmental agency, parastatal organizations etc.
The Government draws staff from every Govt. department and it is not true that only
teachers are deployed for election work. Staff from other categories from almost every
department is engaged for election duty.
However, with a view to ensure that
@page-SC658
election work does not come in conflict with the interest of education, the respondent
Government would like to take the following steps to ensure that teaching work is least
affected :
(i) As far as possible the revision of Electoral roll shall be taken up during holidays or
teachers would be deployed to perform the work on holidays.
(ii) The teachers who are on non-teaching posts i.e. Physical Education Teachers,
Drawing Teachers, Librarian and Lab Assistants, Yoga Instructors etc. would be deployed
for election work.
(iii) The teaching hour loss, if any, shall be compensated by holding extra classes, so that
the minimum prescribed teaching hours are completed.
(iv) The Principals/Heads of Institutions will be directed to make internal adjustment of
time tables and reschedule the classes for making up any possible teaching losses."
8. Learned counsel appearing for the parties, however, as it appears from the impugned
judgment, accepted before the High Court that the services of the teachers should be
utilized for non-teaching purposes only on a day which is not a working day for the
students.
9. The Election Commission is, thus, before us.
10. Mr. K.K. Venugopal, learned Senior Counsel appearing on behalf of the appellant,
would, inter alia, submit :
(i) Holding of an elections is a sovereign function.
(ii) The Election Commission having regard to the provisions contained in the
Constitution of India as also the Representation of the People Act, 1951 is required to
conduct elections for the purpose of upholding democracy.
(iii) Democracy being a basic feature of the Constitution of India, it is obligatory on the
part of the Election Commission to ensure that the citizens who are entitled to vote are
not deprived of their right and those who are not entitled thereto are not permitted to do
so.
(iv) In terms of the provisions of clauses (1) and (6) of Article 324 of the Constitution of
India, it is mandated that whenever the Election Commission asks for deployment of staff
for the purpose of conducting elections, it is obligatory on the part of the President of
India or the Governor of the State to make such number of staff made available to it, and
with a view to fulfill the said constitutional object, the Parliament amended Section 159
of the 1951 Act so as to provide :
"159. Staff of certain authorities to be made available for election work.-
(1) The authorities specified in sub-section (2) shall, when so requested by a Regional
Commissioner appointed under clause (4) of Article 324 or the Chief Electoral Officer of
the State, make available to any Returning Officer such staff as may be necessary for the
performance of any duties in connection with an election.
(2) The following shall be the authorities for the purposes of sub-section (1), namely:-
(i) every local authority;
(ii) every University established or incorporated by or under a Central, Provincial or State
Act;
(iii) a Government company as defined in section 617 of the Companies Act, 1956 (1 of
1956);
(iv) any other institution, concern or undertaking which is established by or under a
Central, Provincial or State Act or which is controlled, or financed wholly or substantially
by funds provided, directly or indirectly, by the Central Government or a State
Government."
(v) The High Court, in that view of the matter could not have issued any direction which
may for all intent and purport interfere with the electoral process.
11. Learned counsel appearing on behalf of the Municipal Corporation of Delhi, New
Delhi Municipal Committee and Union of India adopted the submissions of Mr.
Venugopal.
12. Ms. Reena George, learned counsel appearing on behalf of the writ petitioner-
respondent, on the other hand, submit that - :
(a) the impugned order having been passed in terms of consent of the parties, this Court
should not exercise its jurisdiction under Article 136 of the Constitution of India.
(b) Right to education being a fundamental right having regard to Article 21A of the
Constitution of India, it is obligatory on the part of the State to ensure that the students
are not deprived thereof.
@page-SC659
(c) In the affidavit filed on behalf of the NDMC, it was clearly demonstrated that in some
schools where teaching or instructions are imparted for Class IX or X students, no teacher
was available for a period of two months.
(d) The purpose for which the education is imparted in the schools is to see that the
Government in the municipal schools must ensure that they compete with the standard
maintained by the private schools.
13. Indisputably, for upholding the democracy and the democratic values, holding of
elections is imperative. There cannot also be any doubt or dispute that keeping in view
the constitutional mandate provided for under clauses (1) and (6) of Article 324 of the
Constitution of India, the President of India or the Governor of a State i.e. the Central
Government as also the State Government have a duty to make available to the Election
Commission, or to a Regional Commissioner such staff, as may be necessary for the
discharge of functions conferred on the Election Commission by clause (1) in terms
whereof a power of superintendence, direction and control of elections is to be vested in
the Election Commission, if request in this regard is made. Article 327 of the Constitution
of India empowers the Parliaments to make laws with respect to all matters relating to, or
in connection with, elections to either House of the Parliament or to the House or either
House of the Legislature of a State including the preparation of the electoral rolls, the
delimitation of constituencies and all other matters necessary for securing the due
constitution of such House or Houses.
14. The Parliament with a view to give effect to the said constitutional functions enacted
the Representation of the People Act, 1950 (1950 Act) and the Representation of the
People Act, 1951 (1951 Act).
15. We may notice certain provisions of the said Acts.
1950 Act :
Section 13-A of 1950 Act provides for the designation or nomination of the Chief
Electoral Officers, by the Election Commissioner; whereas Section 13-AA provides for
designation or nomination of a District Election Officer, who is to be an officer of
Government.
Sections 13B, 13CC and Section 29 of the 1950 Act read as under :
"13B. - Electoral registration officers.- (1) The electoral roll for each parliamentary
constituency in the State of Jammu and Kashmir or in a Union territory not having a
Legislative Assembly, each assembly constituency and each Council constituency shall
be prepared and revised by an electoral registration officer who shall be such officer of
Government or of a local authority as the Election Commission may, in consultation with
the Government of the State in which the constituency is situated, designate or nominate
in this behalf.
(2) An electoral registration officer may, subject to any prescribed restrictions, employ
such persons as he thinks fit for the preparation and revision of the electoral roll for the
constituency."
"13CC. Chief Electoral Officers, District Election Officers, etc., deemed to be on
deputation to Election Commission.- The officers referred to in this Part and any other
officer or staff employed in connection with the preparation, revision and correction of
the electoral rolls for, and the conduct of, all elections shall be deemed to be on
deputation to the Election Commission for the period during which they are so employed
and such officers and staff shall, during that period, be subject to the control,
superintendence and discipline of the Election Commission."
"29. Staff of local authorities to be made available.- Every local authority in a State shall,
when so requested by the Chief Electoral Officer of the State, make available to any
Electoral Registration Officer such staff as may be necessary for the performance of any
duties in connection with the preparation and revision of electoral rolls."
1951 Act :
Sections 2(1)(bb) and 2(1)(cc) of 1951 Act provide for the meanings of the terms "Chief
Electoral Officer" and the "District Election Officer", who would be an officer appointed
under Sections 13-A and 13-AA of the 1950 Act.
Part IV of 1951 Act, does not lay down any procedure for requisitioning of a person for
being appointed as the Returning Officer, an Assistant Returning Officer; or Presiding
Officer, or Polling Officer.
However, it may be noticed that after Section 22, which provides for appointment of
Assistant Returning Officers a proviso was added by reason of Act No. 47 of 1966 in
@page-SC660
terms whereof the words "an Officer of Government or of a local authority" had been
inserted.
Sections 26, 28A, 151 and Section 159 read as under :
"26 Appointment of presiding officers for polling stations.- (1) The district election
officer shall appoint a presiding officer for each polling station and such polling officer or
officers as he thinks necessary, but he shall not appoint any person who has been
employed by or on behalf of, or has been otherwise working for, a candidate in or about
the election:
Provided that if a polling officer is absent from the polling station, the presiding officer
may appoint any person who is present at the polling station other than a person who has
been employed by or on behalf of, or has been otherwise working for, a candidate in or
about the election, to be the polling officer during the absence of the former officer, and
inform the district election officer accordingly:
Provided further that nothing in this sub-section shall prevent the district election officer
from appointing the same person to be the presiding officer for more than one polling
station in the same premises.
(2) A polling officer shall, if so directed by the presiding officer, perform all or any of the
functions of a presiding officer under this Act or any rules or orders made thereunder,
(3) If the presiding officer, owing to illness or other unavoidable cause, is obliged to
absent himself from the polling station, his functions shall be performed by such polling
officer as has been previously authorised by the district election officer to perform such
functions during any such absence.
(4) References in this Act to the presiding officer shall, unless the context otherwise
requires, be deemed to include any person performing any function which he is
authorised to perform under sub-section (2) or sub-section (3), as the case may be."
"28A. Returning officer, presiding officer, etc., deemed to be on deputation to Election
Commission.- The returning officer, assistant returning officer, presiding officer, polling
officer and any other officer appointed under this Part, and any police officer designated
for the time being by the State Government, for the conduct of any election shall be
deemed to be on deputation to the Election Commission for the period commencing on
and from the date of the notification calling for such election and ending with the date of
declaration of the results of such election and accordingly, such officers shall, during that
period, be subject to the control, superintendence and discipline of the Election
Commission."
"151. Casual vacancies in the State Legislative Councils.- When before the expiration of
the term of office of a member elected to the Legislative Council of a State, his seat
becomes vacant or is declared vacant or his election to the Legislative Council is declared
void, the Election Commission shall, by a notification in the Official Gazette, call upon
the Council constituency concerned or the members of the Legislative Assembly of the
State, as the case may be, to elect a person for the purpose of filling the vacancy so
caused, before such date as may be specified in the notification, and the provisions of this
Act and of the rules and orders made thereunder shall apply, as far as may be, in relation
to the election of a member to fill such vacancy."
"159. Staff of certain authorities to be made available for election work.- (1) The
authorities specified in sub-section (2) shall, when so requested by a Regional
Commissioner appointed under clause (4) of Article 324 or the Chief Electoral Officer of
the State, make available to any returning officer such staff as may be necessary for the
performance of any duties in connection with an election.
(2) The following shall be the authorities for the purposes of sub-section (1), namely:-
(i) every local authority;
(ii) every University established or incorporated by or under a Central, Provincial or State
Act;
(iii) a Government company as defined in section 617 of the Companies Act, 1956 (1 of
1956);
(iv) any other institution, concern or undertaking which is established by or under a
Central, Provincial or State Act or which is controlled, or financed wholly or substantially
by funds provided, directly or indirectly, by the Central Government or a State
Government."
16-19. We may, however, notice that prior to enactment of Act No. 12 of 1998 in
@page-SC661
terms of Section 159 of the 1951 Act the obligation to make available to any Returning
Officer such staff as may be necessary in connection with an election was only confined
to the local authority.
20

. The question as to whether the staff of the State Bank of India could be requisitioned for
the purpose came up for consideration before this Court in Election Commission of India
v. State Bank of India Staff Association, Local Head Office Unit, Patna and Others
[(1995) Supp 2 SCC 13], wherein this Court upheld the judgment and order of the
Division Bench of the Patna High Court, opining that the officers of the State Bank of
India cannot be requisitioned in terms of Section 26 of the 1951 Act or otherwise. 1995
AIR SCW 1095

21. The constitutional and statutory scheme would lead to a realistic conclusion when
emphasis was laid that it is for the Central Government and the State Governments alone
to provide for the requisite staff. How would they do it is one thing. It may be by fresh
recruitment for the purposes for which the staff are requisitioned or for deployment or by
way of deputation. Indisputably, there are certain functions which may be performed only
by the Government staff. For the said purposes they may be sent on deputation e.g.
Sections 21 and 22 of the 1951 Act provides for the Returning Officers and Assistant
Returning Officers who must be an officer of Government or of a local authority.
Therefore, their services can be requisitioned under clause (6) of Article 324 of the
Constitution of India as also Section 159 of the 1951 Act. The Election Commission or
the Regional Commissioner, as the case may be, is also entitled to request for
requisitioning the services of the persons in the employment of the Government or the
local authority and others who may not be officers of the Government or the local
authority. The services of other employees who are not officers may also be requisitioned.
The Parliament was aware that in an election, requisition of services of the employees of
the Central Government or the State Governments may prove to be insufficient and, thus,
a direction for appointment of the staff from amongst the officers of the local authority
and others have been made.
22

. On the other hand, however, right to education is held to be a fundamental right. It was
so stated in Mohini Jain v. State of Karnataka [(1992) 3 SCC 666] in the following
terms : 1992 AIR SCW 2100

"12. "Right to life" is the compendious expression for all those rights which the courts
must enforce because they are basic to the dignified enjoyment of life. It extends to the
full range of conduct which the individual is free to pursue. The right to education flows
directly from right to life. The right to life under Article 21 and the dignity of an
individual cannot be assured unless it is accompanied by the right to education. The State
Government is under an obligation to make endeavour to provide educational facilities at
all levels to its citizens."
23

. The aforementioned ratio has been affirmed with certain modification by this Court in
Unni Krishnan, J.P. and others v. State of Andhra Pradesh and others [(1993) 1 SCC 645],
expressly stating : 1993 AIR SCW 863, Para 142

"......Having regard to the fundamental significance of education to the life of an


individual and the nation, and adopting the reasoning and logic adopted in the earlier
decisions of this Court referred to hereinbefore, we hold, agreeing with the statement in
Bandhua Mukti Morcha that right to education is implicit in and flows from the right to
life guaranteed by Article 21. That the right to education has been treated as one of
transcendental importance in the life of an individual has been recognised not only in this
country since thousands of years, but all over the world. In Mohini Jain the importance of
education has been duly and rightly stressed. The relevant observations have already been
set out in para 7 hereinbefore. In particular, we agree with the observation that without
education being provided to the citizens of this country, the objectives set forth in the
Preamble to the Constitution cannot be achieved. The Constitution would fail........"
AIR 1984 SC 802
1992 AIR SCW 2100

24

. Article 45 is the only provision in our Constitution which fixes a time limit during
which the State is to provide for free and compulsory education for children until they
complete the age of 14 years. The Constitution has been amended keeping in view the
aforementioned provisions as also the decision of this Court in Unni Krishnan (supra) by
inserting Article 21A of the Constitution of India, which reads as under : 1993 AIR
SCW 863

"The right to education which flows from


@page-SC662
Article 21 is not an absolute right. It must be construed in the light of directive principles.
A true democracy is one where education is universal, where people understand what is
good for them and the nation and the right to education have to be determined. Right to
education, understood in the context of Articles 45 and 41, means that every child/citizen
of this country has a right to free education until he completes the age of fourteen years,
and (b) after child/citizen completes 14 years, his right to education is circumscribed by
the limits of the economic capacity of the State and its development. It is significant that
among the several Articles in Part IV, only Article 45 speaks of a time limit; no other
Article does. It is not a mere pious wish and the State cannot flout the said direction even
after 44 years on the ground that the Article merely calls upon it to "endeavour to
provide" the same and on the further ground that the said Article is not enforceable by
virtue of the declaration in Article 37. The passage of 44 years more than four time the
period stipulated in Article 45 has converted the obligation created by the Article into an
enforceable right. At least now the State should honour the command of Article 45. It
must be made a reality."
25. Sixty years of independence, however, has not brought about the desired result of
imparting compulsory education to all the children. Education is one of the most
important functions of the State. The State has a basic responsibility in regard thereto.
26. In Brown v. Board of Education [(98 LEd 873 : 347 US 483 (1954)], Earl Warren, CJ,
speaking for the US Supreme Court emphasized the right to education in the following
terms :
"Today, education is the most important function of the State and local
Governments.......... It is required in the performance of our most basic responsibility,
even services in the armed forces. It is the very foundation of good citizenship. Today it
is the principal instrument in awakening the child to cultural values, in preparing him for
later professional training, and in helping him to adjust normally to his environment. In
these days it is doubtful any child may reasonably be expected to succeed in life if he is
denied the opportunity of an education."
27. The provisions of the 1950 and 1951 Acts although were enacted in terms of Article
324 of the Constitution of India, the same must be given restricted meaning. Holding of
an election is no doubt of paramount importance. But for the said purpose the education
of the children cannot be neglected. Therefore, it is necessary to maintain the balance
between the two.
28. With an advent of technology requisitioning of a large number of people for carrying
out the election may not be necessary. We may notice that the Election Commission has
different roles to play. Preparation of an electoral rolls, revision of electoral rolls, when
objections are filed, hearing the parties and determining the objections, enumeration of
the voter list and to hold elections as and when due. The Election Commission and its
officers, in our opinion, can formulate an effective scheme to see that the services of a
large number of teachers are not required. The State admittedly is not in a position to
perform its sovereign function of imparting education. Such functions necessarily are
required to be performed by the private actors. Those students who are in a position to get
admission in the public schools presumably would also be in a position to appoint tutors
whereas those students who are admitted to the Government schools ordinarily would be
from the middle or lower middle class or poor families. The state of primary education in
India is in deplorable condition. There admittedly is a heavy drop outs from the schools
particularly from amongst the girl schools. The question if right to exercise franchise
whereupon the emphasis is laid by Mr. Venugopal is an important one, right to education
is also no less important being a fundamental right.
29. The Human Rights Conventions have imposed a duty on the Contracting States to set
up institutions of higher education which would lead to the conclusion that the citizens
thereof should be afforded and an effective right of access to them. In a democratic
society, a right to education is indispensable in the interpretation of right to development
as a human right. [See Leyla Sahin v. Turkey, decided by the European Court of Human
Rights on 10th November, 2005]. Thus, right to development is also considered to be a
basic human right.
30. It is probably with that end in view the counsel appearing for the Election
Commission had also joined the other counsel appearing for the respondents, to suggest
@page-SC663
the court that the services of the teachers may not be requisitioned on the days on which
the schools are open. Submission of Mr. Venugopal that such a contention had not been
made by the learned counsel appearing on behalf of the Election Commission cannot be
accepted.
31. We have, however, considered the matter at some details as the question in regard to
the application of the constitutional right and in particular fundamental right cannot be
thwarted only by reason of a concession made by a counsel.
32. We would, however, notice that the Election Commission before us also categorically
stated that as far as possible teachers would be put on electoral roll revision works on
holidays, non-teaching days and non-teaching hours; whereas non-teaching staff be put
on duty any time. We, therefore, direct that all teaching staff shall be put on the duties of
roll revisions and election works on holidays and non-teaching days. Teachers should not
ordinarily be put on duty on teaching days and within teaching hours. Non-teaching staff,
however, may be put on such duties on any day or at any time, if permissible in law.
33. Subject to the aforementioned modifications, this appeal is dismissed. However, in
the facts and circumstances of this case, there shall be no order as to costs.
Appeal dismissed.
AIR 2008 SUPREME COURT 663 "Anuj Garg v. Hotel Association of India"
(From : 2006 (86) DRJ 668 (Delhi))
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Civil Appeal Nos. 5657 with 5658 of 2007(arising out of SLP (C) Nos. 12781 with 16127
of 2006), D/- 6 -12 -2007.
Anuj Garg and Ors. v. Hotel Association of India and Ors.
(A) Constitution of India, Art.245, Art.13 - LEGISLATURE - LAW -
CONSTITUTIONALITY OF AN ACT - Law - Constitutional validity - To be decided as
per societal conditions prevalent at relevant time - Changed social psyche and
expectations are important factors to be considered in upkeep of law. (Paras 7, 8)
(B) Constitution of India, Art.14 - EQUALITY - Gender equality - Establishment -
Relevance of international treaties. (Para 9)
(C) Punjab Excise Act (1 of 1914), S.30 - Constitution of India, Art.14, Art.16, Art.21 -
STATE EXCISE - EQUALITY IN PUBLIC EMPLOYMENT - RIGHT TO LIFE -
Prohibition on employment of women in Hotels and Bars serving liquor - Violates gender
equality - Personal freedom is a fundamental tenet - Cannot be compromised on ground
of security of women - Parens patriae power of State - Not beyond judicial scrutiny.
Section 30 of Punjab Act prohibiting employment of women in any part of premises in
which liquor or intoxicating drug is consumed by the public results in an invidious
discrimination. (Para 53)
Right to Self-Determination is an important offshoot of Gender Justice discourse. At the
same time, security and protection to carry out such choice or option specifically, and
state of violence-free being generally is another tenet of the same movement. In fact, the
latter is apparently a more basic value in comparison to right to options in the feminist
matrix. Privacy rights prescribe autonomy to choose profession whereas security
concerns texture methodology of delivery of this assurance. But it is a reasonable
proposition that the measures to safeguard such a guarantee of autonomy should not be so
strong that the essence of the guarantee is lost. State protection must not translate into
censorship. It is to be borne in mind that legislations with pronounced 'protective
discrimination' aims, such as this one, potentially serve as double edged swords. Strict
scrutiny test should be employed while assessing the implications of this variety of
legislations. Legislation should not be only assessed on its proposed aims but rather on
the implications and the effects. Section - 30 of Punjab Act suffers from incurable
fixations of stereotype morality and conception of sexual role. The perspective thus
arrived at is outmoded in content and stifling in means. (Paras 33, 34, 44, 45)
Instead of prohibiting women employment in the bars altogether the State should focus
on factoring in ways through which unequal consequences of sex differences can be
eliminated. It is State's duty to ensure circumstances of safety which inspire confidence in
women to discharge the duty freely in accordance to the requirements of the profession
they choose to follow. Any other policy inference (such as the one embodied under S. 30)
from societal conditions would
@page-SC664
be oppressive on the women and against the privacy rights. (Para 41)
(D) Constitution of India, Art.14, Art.226, Art.32 - EQUALITY - WRITS - Gender
equality - Protective discrimination statute - Standard of judicial scrutiny.
The test to review a Protective Discrimination Statute would entail a two pronged
scrutiny : (a) The legislative interference should be justified in principle, (b) the same
should be proportionate in measure. The Court's task is to determine whether the
measures furthered by the State in form of legislative mandate, to augment the legitimate
aim of protecting the interests of women are proportionate to the other bulk of well
settled gender norms such as autonomy, equality of opportunity, right to privacy et al. The
bottom-line in this behalf would be a functioning modern democratic society which
ensures freedom to pursue varied opportunities and options without discriminating on the
basis of sex, race, caste or any other like basis. In fine, there should be a reasonable
relationship of proportionality between the means used and the aim pursued. (Para
49)
(E) Punjab Excise act (1 of 1914), S.30 - STATE EXCISE - RIGHT TO LIFE -
EQUALITY IN PUBLIC EMPLOYMENT - PROHIBITION - Employment in Hotels
and Bars serving liquor - Prohibition on employment of men below 25 years of age -
Violates right to livelihood.
Constitution of India, Art.21, Art.16. (Para 54)
(F) Punjab Excise Act (1 of 1914), S.30 - STATE EXCISE - Hotels and Bars serving
liquor - Prohibition on employment of women - Amounts to invidious discrimination on
ground of sex - Mere possibility of untoward incidents - Cannot be ground to make it
intra vires. (Para 51)
(G) Constitution of India, Art.133 - APPEAL - PLEA - HIGH COURT - JUDGMENT -
New plea - Plea not raised in High Court - Judgment allowed to attain finality - Party
estopped from challenging correctness of judgment in appeal filed by third party. (Para
52)

(H) Constitution of India, Pre., Art.16, Art.21, Art.14, Art.19(1)(g) - STATE EXCISE -
RIGHT TO LIFE - FREEDOM OF TRADE - DOCTRINES - Trade in liquor - Doctrine
of res extra commercium - Cannot be extended to prohibit employment of women in
Hotels and Bars serving liquor.
Punjab Excise Act (1 of 1914), S.30. (Para 25)
Cases Referred : Chronological Paras
2006 AIR SCW 1869 : AIR 2006 SC 3480 (Rel. on, Pnt H) 26
(2004) 9 SCC 512 (Ref., Pnt B) 16
(2004)18 BHRC 52 21
2003 AIR SCW 3536 : AIR 2003 SC 2902 (Rel. on, Pnt-A) 7
2000 AIR SCW 969 : AIR 2000 SC 1274 : 2000 Lab IC 1033 (Ref., Pnt-B) 12
1999 AIR SCW 811 : AIR 1999 SC 1149 (Ref., Pnt B) 10
(1998) ECHR 21 38
1997 AIR SCW 3043 : AIR 1997 SC 3011 : 1997 Lab IC 2890 (Ref., Pnt B) 14
(1997) ECHR 6 38
1996 AIR SCW 2178 : AIR 1996 SC 1864 (Ref., Pnt B) 13
(1996) 58 US 515 50
(1993) ECHR 29 38
(1985) 473 US 432 30
(1985) ECHR 7 38
AIR 1982 SC 879 : 1982 Lab IC 806 (Ref .Pnt B) 15
AIR 1981 SC 1829 : 1981 Lab IC 1313 (Ref. Pnt B) 11
(1973) 411 US 677 : 36 L ED 2d 583 42
433 US 321 43
Rajiv Dutta, Sr. Advocate, M. P. Shorawala, Ms. Jyoti Saxena, Vipin K. Saxena, Ms.
Shashi Kiran, for Appellants; Arun Jaitley, Nagender Rai, Sr. Advocates, Ravi Sikri, Mrs.
Saket Sikri, Ms. Madhu Sikri, Vikas Sharma, Ms. Sweta Garg and D. S. Mahra, for
Respondents.
Judgement
1. S. B. SINHA, J. :-Leave granted.
Introduction
2. Constitutional validity of Section 30 of the Punjab Excise Act, 1914 (for short "the
Act") prohibiting employment of "any man under the age of 25 years" or "any woman" in
any part of such premises in which liquor or intoxicating drug is consumed by the public
is the question involved in this appeal which arises out of a judgment and order dated
12.01.2006 passed by the High Court of Delhi in CWP No. 4692 of 1999.
Background Facts
3. First Respondent is the Hotel Association of India. Its members carry on business in
hotels. Liquor is served in the hotels not only in the bar but also in the restaurant. Liquor
is also served in rooms as
@page-SC665
part of room service. First Respondent with four others filed a writ petition before the
Delhi High Court questioning the validity of the said provision. By reason of the
impugned judgment, Section 30 of the Act has been declared to be ultra vires Articles
19(1)(g), 14 and 15 of the Constitution of India to the extent it prohibits employment of
any woman in any part of such premises, in which liquor or intoxicating drugs are
consumed by the public.
4. National Capital Territory of Delhi appears to have accepted the said judgment. But as
a respondent, it seeks to support the impugned statutory provision, although no Special
Leave Petition has been filed by it. Appellants herein, who are a few citizens of Delhi, are
before us.
A special leave petition has been filed by the First Respondent questioning that part of the
order whereby restrictions had been put on employment of any man below the age of 25
years.
Submissions
5. Mr. Rajiv Dutta, learned senior counsel appearing on behalf of the appellants, in
support of this appeal, submitted that as nobody has any fundamental right to deal in
liquor, being 'res extra commercium', the State had the right to make a law and/or
continue the old law imposing reasonable restrictions on the nature of employment
therein.
6. Mr. Arun Jaitley, learned senior counsel appearing on behalf of the respondents, on the
other hand, supported the impugned judgment.
Constitutional Backdrop
7. The Act is a pre-constitutional legislation. Although it is saved in terms of Article 372
of the Constitution, challenge to its validity on the touchstone of Articles 14, 15 and 19 of
the Constitution of India, is permissible in law. While embarking on the questions raised,
it may be pertinent to know that a statute although could have been held to be a valid
piece of legislation keeping in view the societal condition of those times, but with the
changes occurring therein both in the domestic as also international arena, such a law can
also be declared invalid.

In John Vallamattom and Anr. v. Union of India (2003) 6 SCC 611], this Court, while
referring to an amendment made in UK in relation to a provision which was in pari
materia with Section 118 of Indian Succession Act, observed : 2003 AIR SCW 3536,
Para 28

"The constitutionality of a provision, it is trite, will have to be judged keeping in view the
interpretative changes of the statute affected by passage of time."
Referring to the changing legal scenario and having regard to the Declaration on the
Right to Development adopted by the World Conference on Human Rights as also Article
18 of the United Nations Covenant on Civil and Political Rights, 1966, it was held :
"33. It is trite that having regard to Article 13(1) of the Constitution, the constitutionality
of the impugned legislation is required to be considered on the basis of laws existing on
26-1-1950, but while doing so the court is not precluded from taking into consideration
the subsequent events which have taken place thereafter. It is further trite that the law
although may be constitutional when enacted but with passage of time the same may be
held to be unconstitutional in view of the changed situation."

8. Changed social psyche and expectations are important factors to be considered in the
upkeep of law. Decision on relevance will be more often a function of time we are
operating in. Primacy to such transformation in constitutional rights analysis would not
be out of place. It will be in fitness of the discussion to refer to the following text from
"Habits of the Heart: Individualism and Commitment in American Life" by R. Bellah, R.
Madsen, W. Sullivan, A. Swidler and S. Tipton, 1985, page 286 which suggests factoring
in of such social changes.
"The transformation of our culture and our society would have to happen at a number of
levels. If it occurred only in the minds of individuals (as to some degree it already has) it
would be powerless. If it came only from the initiative of the State, it would be
tyrannical. Personal transformation among large numbers is essential, and it must not
only be a transformation of consciousness but must also involve individual action. But
individuals need the nurture of crops that carry a moral tradition reinforcing their own
aspirations.
These are commitments that require a new social ecology and a social movement
dedicated to the idea of such a transformation."
International Treaties
9. International treaties vis-a-vis the
@page-SC666
rights of women was noticed by this Court in a large number of judgments, some of
which we may notice at this stage.
10

. In Githa Hariharan v. Reserve Bank of India [(1999) 2 SCC 228], this Court was faced
with construing Section 6(a) of Hindu Minority and Guardianship Act, 1956 and Section
19(b) of Guardians and Wards Act, 1890. The sections were challenged as violative of the
equality clause of the Constitution, inasmuch as the mother of the minor is relegated to an
inferior position on ground of sex alone since her right, as a natural guardian of the
minor, is made cognizable only 'after' the father. The court relied upon the Convention on
the Elimination of All Forms of Discrimination Against Women, 1979 ("CEDAW") and
the Beijing Declaration, which directs all State parties to take appropriate measures to
prevent discrimination of all forms against women is quite clear. It was held by the court
that the domestic courts are under an obligation to give due regard to International
Conventions and Norms for construing domestic laws when there is no inconsistency
between them. 1999 AIR SCW 811

11

. In Air India v. Nergesh Meerza [(1981) 4 SCC 335], this Court was faced with the
constitutional validity of Regulation 46(i)(c) of Air India Employees' Service
Regulations, it was provided that the services of the Air Hostesses would stand
terminated on first pregnancy. The Court after considering various US Supreme Court
judgments regarding pregnant women held that the observations made therein would
apply to the domestic cases. AIR 1981 SC 1829

12

. In Municipal Corporation of Delhi v. Female Workers (Muster Roll) and Anr. [(2000) 3
SCC 224], the short question which was to be decided by this Court was whether having
regard to the provisions contained in Maternity Benefit Act, 1961, women engaged on
casual basis or on muster roll basis on daily wages and not only those in regular
employment were eligible for maternity leave. The Court while upholding the right of the
female workers to get maternity leave relied upon the doctrine of social justice as
embodied in Universal Declaration of Human Rights Act, 1948 and Article 11 of the
Convention on the Elimination of All Forms of Discrimination Against Women held that
the provisions of the same must be read into the service contracts of Municipal
Corporation. 2000 AIR SCW 969

13

. In Madhu Kishwar and Ors. v. State of Bihar and Ors. [(1996) 5 SCC 125], challenge
was made to certain provisions of Chotanagpur Tenancy Act, 1908 providing succession
to property in the male line in favour of the male on the premise that the provisions are
discriminatory and unfair against women and, therefore, ultra vires the equality clause in
the Constitution. The Court while upholding the fundamental right of the Tribal women
to the right to livelihood held that the State was under an obligation to enforce the
provisions of the Vienna Convention on the Elimination of All Forms of Discrimination
Against Women (CEDAW) which provided that discrimination against women violated
the principles of equality of rights and respects for human dignity. 1996 AIR SCW 2178

14
. In Vishaka and Ors. v. State of Rajasthan and Ors. [(1997) 6 SCC 241], the writ petition
was filed for the enforcement of the fundamental rights of working women under Articles
14, 19 and 21 of the Constitution of India with the aim of finding suitable methods for
realization of the true concept of "gender equality"; and preventing sexual harassment of
working women in all work places through judicial process to fill the vacuum in existing
legislation. This Court while framing the guidelines and norms to be observed by the
employers in work places to ensure the prevention of sexual harassment of women, inter
alia, relied on the provisions in the Convention on the Elimination of All Forms of
Discrimination Against Women as also the general recommendations of CEDAW for
construing the nature and ambit of constitutional guarantee of gender equality in our
Constitution. 1997 AIR SCW 3043

15

. In Randhir Singh v. Union of India and Ors. [(1982) 1 SCC 618], this Court while
holding that non-observance of the principle of 'equal pay for equal work' for both men
and women under Article 39(d) of the Constitution amounted to violation of Articles 14
and 16, recognized that the principle was expressly recognized by all socialist systems of
law including the Preamble to the Constitution of the International Labour Organization.
AIR 1982 SC 879

16. In Liverpool and London S.P. and I. Association Ltd. v. M.V. Sea Success I and Anr.
[(2004) 9 SCC 512], this Court had to
@page-SC667
interpret the meaning and import of the word 'necessaries' used in Section 5 of the
Admiralty Court Act, 1861. The Court while importing the meaning of the same through
Foreign (American) Court decisions, opined - :
"It is true that this Court is not bound by the American decisions. The American decisions
have merely a persuasive value but this Court would not hesitate in borrowing the
principles if the same is in consonance with the scheme of Indian law keeping in view the
changing global scenario. Global changes and outlook in trade and commerce could be a
relevant factor. With the change of time, from narrow and pedantic approach, the court
may resort to broad and liberal interpretation. What was not considered to be a necessity
a century back, may be held to be so now."
Setting of the Debate
17. In the instant matter, we are in the thick of debate relating to Individual Rights of
women. The classical counter to individual rights is the community orientation of rights.
There is no such shade to the current matter. Here the individual rights are challenged by
a problem of practical import of enforcement and security.
18. Therefore, the important jurisprudential tenet involved in the matter is not the
prioritization of rights inter se but practical implementation issues competing with a right.
It is one thing when two norms falling in the same category (for instance Individual
Rights versus Community Orientation of Rights) compete and quite another when two
norms with unequal hierarchical status come in conflict with each other.
19. At the very outset we want to define the contours of the discussion which is going to
ensue. Firstly, the issue floated by the State is very significant, nonetheless does not fall
in the same class as that of rights which it comes in conflict with, ontologically. Secondly,
the issue at hand has no social spillovers. The rights of women as individuals rest beyond
doubts in this age. If we consider (various strands of) feminist jurisprudence as also
identity politics it is clear that time has come that we take leave of the theme
encapsulated under Section 30. And thirdly we will also focus our attention on the
interplay of doctrines of self-determination and an individual's best interests.
Equality
20. When the original Act was enacted, the concept of equality between two sexes was
unknown. The makers of the Constitution intended to apply equality amongst men and
women in all spheres of life. In framing Articles 14 and 15 of the Constitution, the
constitutional goal in that behalf was sought to be achieved. Although the same would not
mean that under no circumstance, classification, inter alia, on the ground of sex would be
wholly impermissible but it is trite that when the validity of a legislation is tested on the
anvil of equality clauses contained in Articles 14 and 15, the burden therefor would be on
the State. While considering validity of a legislation of this nature, the court was to take
notice of the other provisions of the Constitution including those contained in Part IV A
of the Constitution.
21. In Bhe and Ors. v. The Magistrate, Khayelisha and Ors. [(2004) 18 BHRC 52], the
South African Constitutional Court was required to consider the constitutionality of the
Black Administration Act, 1927 (South Africa) and the Regulations of the Administration
and Distribution of the Estates of Deceased Blacks (South Africa). This scheme was
purporting to give effect to the customary law of succession where principle of male
primogeniture is central to customary law of succession.
It was held by the majority that the rule of male primogeniture as it applied in customary
law to the inheritance of property was inconsistent with the Constitution and invalid to
the extent that it excluded or hindered women and extra-marital children from inheriting
property. The rules of succession in customary law had not been given the space to adapt
and to keep pace with changing social conditions and values. Instead, they had overtime
become increasingly out of step with the real values and circumstances of the society they
were meant to serve. The application of the customary law rules of succession in
circumstances vastly different from their traditional setting caused much hardship. Thus
the official rules of customary law of succession were no longer universally observed.
The exclusion of women from inheritance on the grounds of gender was a clear violation
of the constitutional prohibition against unfair discrimination.
Further, the principle of primogeniture
@page-SC668
also violated the right of women to human dignity as it implied that women were not fit
or competent to own and administer property. Its effect was to subject those women to a
status of perpetual minority, placing them automatically under the control of male heirs,
simply by virtue of gender differentiation.
Remark on changing realities
22. We may now look into the ground reality. In India, hospitality industry has grown by
leaps and bounds. As noticed hereinbefore, liquor, in the hospitality industry, is being
served not only in the bar but also in the restaurant. Service of liquor is permissible also
in the rooms of a hotel.
23. The impugned provision provides for wide restrictions. It prohibits employment of
any woman in any part of the premises where liquor is being served. It would prohibit
employment of women and men below 25 years in any of the restaurants. As liquor is
permitted to be served even in rooms, the restriction would also operate in any of the
services including housekeeping where a woman has to enter into a room; the logical
corollary of such a wide restriction would be that even if service of liquor is made
permissible in the flight, the employment of women as air-hostesses may be held to be
prohibited.
24. Hotel Management has opened up a viesta of young men and women for
employment. A large number of them are taking hotel management graduation courses.
They pass their examinations at a very young age. If prohibition in employment of
women and men below 25 years is to be implemented in its letter and spirit, a large
section of young graduates who have spent a lot of time, money and energy in obtaining
the degree or diploma in hotel management would be deprived of their right of
employment. Right to be considered for employment subject to just exceptions is
recognized by Article 16 of the Constitution. Right of employment itself may not be a
fundamental right but in terms of both Articles 14 and 16 of the Constitution of India,
each person similarly situated has a fundamental right to be considered therefor. When a
discrimination is sought to be made on the purported ground of classification, such
classification must be founded on a rational criteria. The criteria which in absence of any
constitutional provision and, it will bear repetition to state, having regard to the societal
conditions as they prevailed in early 20th century, may not be a rational criteria in the
21st century. In the early 20th century, the hospitality sector was not open to women in
general. In the last 60 years, women in India have gained entry in all spheres of public
life. They have also been representing people at grass root democracy. They are now
employed as drivers of heavy transport vehicles, conductors of service carriage, pilots et.
al. Women can be seen to be occupying Class IV posts to the post of a Chief Executive
Officer of a Multinational Company. They are now widely accepted both in police as also
army services.
Res Extra Commercium Issue
25. Occupation/service in the management of hotel industry is a specialized job. It
requires specialized skill. To deprive a large section of successful young men and women
from obtaining any job for which they have duly been trained, in our opinion, would be
wholly unjust. The State cannot invoke the doctrine of 'res extra commercium' in the
matter of appointment of eligible persons. The said principle could have been invoked if
the State intended to adopt a policy of prohibition. It is one thing to say that the trade in
liquor is regulated but it is another thing to say that such regulations which are principally
in the area of manufacture, sale, export and import of intoxicants should be allowed to
operate in other fields also.
26

. In Kerala Samsthana Chethu Thozhilali Union v. State of Kerala and others [(2006) 4
SCC 327], this Court held: 2006 AIR SCW 1869, Paras 55 and 57
"When an employer gives employment to a person, a contract of employment is entered
into. The right of the citizens to enter into any contract, unless it is expressly prohibited
by law or is opposed to public policy, cannot be restricted. Such a power to enter into a
contract is within the realm of the Indian Contract Act. It has not been and could not be
contended that a contract of employment in the toddy shops would be hit by Section 23 of
the Indian Contract Act. So long as the contract of employment in a particular trade is not
prohibited either in terms of the statutory or constitutional scheme, the State's
intervention would be unwarranted unless there exists a statutory interdict. Even to what
extent such a legislative power can be exercised would be the subject-matter of debate
but in a case of this
@page-SC669
nature there cannot be any doubt that the impugned rules are also contrary to the
provisions of the Indian Contract Act as also the Specific Relief Act, 1963."
It was further observed:
"Furthermore, a person may not have any fundamental right to trade or do business in
liquor, but the person's right to grant employment or seek employment, when a business
is carried on in terms of the provisions of the licence, is not regulated."
Parens Patriae Power of State
27. One important justification to Section 30 of the Act is parens patriae power of State. It
is a considered fact that use of parens patriae power is not entirely beyond the pale of
judicial scrutiny.
28. Parens Patriae power has only been able to gain definitive legalist orientation as it
shifted its underpinning from being merely moralist to a more objective grounding i.e.
utility.
29. The subject matter of the Parens Patriae power can be adjudged on two counts:
(i) in terms of its necessity, and
(ii) assessment of any tradeoff or adverse impact, if any.
30. This inquiry gives the doctrine an objective orientation and therefore prevents it from
falling foul of due process challenge. (See City of Cleburne v. Cleburne Living Center,
473 US 432, 439-41 (1985)). Parens Patriae power is subject to constitutional challenge
on the ground of Right to Privacy also. Young men and women know what would be the
best offer for them in the service sector. In the age of internet, they would know all pros
and cons of a profession. It is their life; subject to constitutional, statutory and social
interdicts - a citizen of India should be allowed to live her life on her own terms.
31. Let us understand various standards which objectify Parens Patriae. Best interests
standard is one test in US jurisdiction in Child Custody matters. Similarly other standards
have evolved amongst which right to self-determination holds an important place.
Right to employment vis-a-vis Security: Competing Values
32. The instant matter involves a fundamental tension between right to employment and
security.
33. The fundamental tension between autonomy and security is difficult to resolve. It is
also a tricky jurisprudential issue. Right to Self-Determination is an important offshoot of
Gender Justice discourse. At the same time, security and protection to carry out such
choice or option specifically, and state of violence-free being generally is another tenet of
the same movement. In fact, the latter is apparently a more basic value in comparison to
right to options in the feminist matrix.
34. Privacy rights prescribe autonomy to choose profession whereas security concerns
texture methodology of delivery of this assurance. But it is a reasonable proposition that
that the measures to safeguard such a guarantee of autonomy should not be so strong that
the essence of the guarantee is lost. State protection must not translate into censorship.
35. At the same time we do not intend to further the rhetoric of empty rights. Women
would be as vulnerable without State protection as by the loss of freedom because of
impugned Act. The present law ends up victimizing its subject in the name of protection.
In that regard the interference prescribed by State for pursuing the ends of protection
should be proportionate to the legitimate aims. The standard for judging the
proportionality should be a standard capable of being called reasonable in a modern
democratic society.
36. Instead of putting curbs on women's freedom, empowerment would be a more tenable
and socially wise approach. This empowerment should reflect in the law enforcement
strategies of the State as well as law modelling done in this behalf.
37. Also with the advent of modern State, new models of security must be developed.
There can be a setting where the cost of security in the establishment can be distributed
between the State and the employer.
38. Gender equality today is recognized by the European Court as one of the key
principles underlying the Convention and a goal to be achieved by member States of the
Council of Europe.
In the case of Abdulaziz, Cabales and Balkandali v. United Kingdom, [1985] ECHR 7,
the Court held:
"As to the present matter, it can be said that the advancement of the equality of the sexes
is today a major goal in the member
@page-SC670
States of the Council of Europe. This means that very weighty reasons would have to be
advanced before a difference of treatment on the ground of sex could be regarded as
compatible with the Convention."
Following Abdulaziz (supra) the European Court of Human Rights once again observed
in Van Raalte v. The Netherlands, [1997] ECHR 6:
"In the applicant's submission, differences in treatment based on sex were already
unacceptable when section 25 of the General Child Care Benefits Act was enacted in
1962. The wording of Article 14 of the Convention (Art. 14) showed that such had been
the prevailing view as early as 1950. Moreover, legal and social developments showed a
clear trend towards equality between men and women. The applicant drew attention to,
inter alia, the Court's Abdulaziz, Cabales and Balkandali v. the United Kingdom
judgment of 28 May 1985 (Series A No. 94), which stated explicitly that "the
advancement of the equality of the sexes is today a major goal in the member States of
the Council of Europe" and that "very weighty reasons would have to be advanced before
a difference of treatment on the ground of sex could be regarded as compatible with the
Convention" (loc. cit., p. 38, para. 78)."
(Emphasis supplied)
(See also Schuler-Zgraggen v. Swizerland, [1993] ECHR 29; and Petrovic v. Austria,
[1998] ECHR 21)
Stereotype Roles and Right to Options
39. Professor Williams in "The Equality Crisis: Some Reflections on Culture, Courts, and
Feminism" published in 7 WOMEN'S RTS. L. REP. 175 (1982) notes issues arising
where biological distinction between sexes is assessed in the backdrop of cultural norms
and stereotypes. She characterizes them as "hard cases". In hard cases, the issue of
biological difference between sexes gathers an overtone of societal conditions so much so
that the real differences are pronounced by the oppressive cultural norms of the time. This
combination of biological and social determinants may find expression in popular
legislative mandate. Such legislations definitely deserve deeper judicial scrutiny. It is for
the court to review that the majoritarian impulses rooted in moralistic tradition do not
impinge upon individual autonomy. This is the backdrop of deeper judicial scrutiny of
such legislations world over.
40. Therefore, one issue of immediate relevance in such cases is the effect of the
traditional cultural norms as also the state of general ambience in the society which
women have to face while opting for an employment which is otherwise completely
innocuous for the male counterpart. In such circumstances the question revolves around
the approach of State.
41. Instead of prohibiting women employment in the bars altogether the State should
focus on factoring in ways through which unequal consequences of sex differences can be
eliminated. It is State's duty to ensure circumstances of safety which inspire confidence in
women to discharge the duty freely in accordance to the requirements of the profession
they choose to follow. Any other policy inference (such as the one embodied under
section 30) from societal conditions would be oppressive on the women and against the
privacy rights.
42. The description of the notion of "romantic paternalism" by the US Supreme Court in
Frontiero v. Richardson (411 U.S. 677, 93 S.Ct. 1764) makes for an interesting reading. It
is not to say that Indian society is similarly situated and suffers from the same degree of
troublesome legislative past but nevertheless the tenor and context are not to be missed.
The court noted in this case of military service:
"There can be no doubt that our Nation has had a long and unfortunate history of sex
discrimination. Traditionally, such discrimination was rationalized by an attitude of
'romantic paternalism' which, in practical effect, put women, not on a pedestal, but in a
cage........
As a result of notions such as these, our statute books gradually became laden with gross,
stereotyped distinctions between the sexes......."
The court also maintained the strict scrutiny standard for review and repelled the
administrative convenience argument in the following terms:
"In any case, our prior decisions make clear that, although efficacious administration of
governmental programs is not without some importance, 'the Constitution recognizes
higher values than speed and efficiency.' And when we enter the realm of 'strict judicial
scrutiny,' there can be no
@page-SC671
doubt that 'administrative convenience' is not a shibboleth, the mere recitation of which
dictates constitutionality.
On the contrary, any statutory scheme which draws a sharp line between the sexes, solely
for the purpose of achieving administrative convenience, necessarily commands
'dissimilar treatment for men and women who are similarly situated,' and therefore
involves the 'very kind of arbitrary legislative choice' forbidden by the (Constitution). We
therefore conclude that, by according differential treatment to male and female members
of the uniformed services for the sole purpose of achieving administrative convenience,
the challenged statutes violate the Due Process Clause of the Fifth Amendment."
43. In another similar case wherein there was an effective bar on females for the position
of guards or correctional counsellors in the Alabama State penitentiary system. The
prison facility housed sexual offenders and the majority opinion on this basis inter alia
upheld the bar. Justice Marshall's dissent captures the ranges of issues within a
progressive paradigm. Dissent in Dothard v. Rawlinson (433 U.S. 321, 97 S.Ct. 2720)
serves as useful advice in the following terms:
"It appears that the real disqualifying factor in the Court's view is 'the employee's very
womanhood.' The Court refers to the large number of sex offenders in Alabama prisons,
and to 'the likelihood that inmates would assault a woman because she was a woman.' In
short, the fundamental justification for the decision is that women as guards will generate
sexual assaults. With all respect, this rationale regrettably perpetuates one of the most
insidious of the old myths about women that women, wittingly or not, are seductive
sexual objects. The effect of the decision, made, I am sure with the best of intentions, is
to punish women because their very presence might provoke sexual assaults. It is women
who are made to pay the price in lost job opportunities for the threat of depraved conduct
by prison inmates. Once again, 'the pedestal upon which women have been placed has
upon closer inspection, been revealed as a cage.' It is particularly ironic that the cage is
erected here in response to feared misbehavior by imprisoned criminals."
He also notes the nature of protective discrimination (as garb) in the following terms:
"The Court points to no evidence in the record to support the asserted 'likelihood that
inmates would assault a woman because she was a woman.' Perhaps the Court relies upon
common sense, or 'innate recognition'. But the danger in this emotionally laden context is
that common sense will be used to mask the "romantic paternalism" and persisting
discriminatory attitudes that the Court properly eschews. To me, the only matter of innate
recognition is that the incidence of sexually motivated attacks on guards will be minute
compared to the 'likelihood that inmates will assault' a guard because he or she is a guard.
The proper response to inevitable attacks on both female and male guards is not to limit
the employment opportunities of law-abiding women who wish to contribute to their
community, but to take swift and sure punitive action against the inmate offenders.
Presumably, one of the goals of the Alabama prison system is the eradication of inmates'
antisocial behavior patterns so that prisoners will be able to live one day in free society.
Sex offenders can begin this process by learning to relate to women guards in a socially
acceptable manner. To deprive women of job opportunities because of the threatened
behavior of convicted criminals is to turn our social priorities upside down."
The Standard of Judicial Scrutiny
44. It is to be borne in mind that legislations with pronounced "protective discrimination"
aims, such as this one, potentially serve as double edged swords. Strict scrutiny test
should be employed while assessing the implications of this variety of legislations.
Legislation should not be only assessed on its proposed aims but rather on the
implications and the effects. The impugned legislation suffers from incurable fixations of
stereotype morality and conception of sexual role. The perspective thus arrived at is
outmoded in content and stifling in means.
45. No law in its ultimate effect should end up perpetuating the oppression of women.
Personal freedom is a fundamental tenet which cannot be compromised in the name of
expediency until unless there is a compelling State purpose. Heightened level of scrutiny
is the normative threshold for judicial review in such cases.
46. Professor Christine A. Littleton in her widely quoted article RECONSTRUCTING
@page-SC672
SEXUAL EQUALITY, 75 CALR 1279, July 1987 makes a useful observation in this
regard:
"The difference between human beings, whether perceived or real, and whether
biologically or socially based, should not be permitted to make a difference in the lived-
out equality of those persons. I call this the model of 'equality as acceptance.' To achieve
this form of sexual equality, male and female 'differences' must be costless relative to
each other."
47. Having regard to the scope of Section 30 of the Act and the impugned legislation
generally the Court has to reach to a finding as to whether the legislative interference to
the autonomy in employment opportunities for women is justified as a legitimate aim and
proportionate to the aim pursued. In this behalf it would be relevant to understand the
approach of European Court of Human Rights which has very often dealt with matters of
competing public interests and tuned new legal devices for the same. Doctrine of
Proportionality and Incompatibility would definitely find mention in such a discussion.
48. The test to review such a Protective Discrimination Statute would entail a two
pronged scrutiny:
(a) the legislative interference (induced by sex discriminatory legalisation in the instant
case) should be justified in principle,
(b) the same should be proportionate in measure.
49. The Court's task is to determine whether the measures furthered by the State in form
of legislative mandate, to augment the legitimate aim of protecting the interests of women
are proportionate to the other bulk of well-settled gender norms such as autonomy,
equality of opportunity, right to privacy et al. The bottom-line in this behalf would be a
functioning modern democratic society which ensures freedom to pursue varied
opportunities and options without discriminating on the basis of sex, race, caste or any
other like basis. In fine, there should be a reasonable relationship of proportionality
between the means used and the aim pursued.
50. In United States v. Virginia (518 U.S. 515, 532-33 (1996)) Justice Ginsburg notes
with particular emphasis the need for an intrusive multi-stage review in sex
discrimination statutes. The court observed :
"The heightened review standard our precedent establishes does not make sex a
proscribed classification. Supposed "inherent differences" are no longer accepted as a
ground for race or national origin classifications. Physical differences between men and
women, however, are enduring. "Inherent differences" between men and women, we have
come to appreciate, remain cause for celebration, but not for denigration of the members
of either sex or for artificial constraints on an individual's opportunity. Sex classifications
may be used to compensate women "for particular economic disabilities [they have]
suffered," to "promote equal employment opportunity," to advance full development of
the talent and capacities of our Nation's people. But such classifications may not be used,
as they once were, to create or perpetuate the legal, social, and economic inferiority of
women." (internal citations omitted)
Changing Stand of the Government of NCT Delhi
51. The Government of NCT Delhi, although did not challenge the impugned judgment
of the Delhi High Court, seeks to enter into the fray through a side door. It, on the one
hand, challenges the locus of the appellant which objection, if upheld, would make the
appeal liable to be dismissed at the threshold, on the other, seeks to justify the validity of
Section 30 of the Act. It cites examples of Jessica Lal and BMW to highlight dangerous
consequences of allowing sale and consumption of liquor by young men below the age of
25 years and vulnerability of women while working in bars. When the restrictions were in
force, they could not prevent such occurrences. If the restriction goes, some such
incidents may again happen. But only on a pre-supposition that there is a possibility of
some incident happening, we cannot declare a law intra vires which is ex facie ultra vires.
52. We, furthermore, deprecate this practice of the Government of NCT to raise a
contention of the aforementioned nature which not only had not been raised before the
High Court but in an appeal filed by a few citizens maintainability whereof is in question.
It, having allowed the judgment of High Court to attain finality, is estopped by records to
question the correctness of the impugned judgment.
@page-SC673
Conclusion
53. In the instant case the end result is an invidious discrimination perpetrating sexual
differences.
54. Young men who take a degree or diploma in Hotel Management enter into service at
the age of 22 years or 23 years. It, thus, cannot prohibit employment of men below 25
years. Such a restriction keeping in view a citizen's right to be considered for
employment, which is a facet of the right to livelihood do not stand judicial scrutiny.
55. For the reasons aforementioned, we do not find any infirmity in the impugned
decision of the High Court. The appeal is accordingly dismissed. Cross-appeal filed by
the respondents is allowed. There shall be no order as to costs.
Appeal dismissed.
AIR 2008 SUPREME COURT 673 "Nopany Investments (P) Ltd., M/s. v. Santokh Singh
(HUF)"
(From : Delhi)*
Coram : 2 TARUN CHATTERJEE AND P. SATHASIVAM, JJ.
Civil Appeal No. 5761 of 2007 (arising out of SLP (C) No. 9963 of 2007), D/- 10 -12
-2007.
M/s. Nopany Investments (P.) Ltd. v. Santokh Singh (HUF).
HINDU LAW - EVICTION - TENANCY - ESTOPPEL - Hindu Law - HUF - Karta -
Junior member of joint Hindu Family - Can act as Karta of family - Said member all
along been realising rent from tenant - Suit for eviction of tenant from HUF Property
filed by said member - Tenant estopped from raising question of maintainability of suit at
instance of said member of HUF.
Evidence Act (1 of 1872), S.115.
If the Karta of the HUF was away in a remote place, (in this case in a foreign country)
and his return within a reasonable time was unlikely, a junior member of HUF could act
as the Karta of the family. In the instant case, the elder brother 'D' who is permanently
staying in United Kingdom was /is not in a position to handle the joint family property
for which reason he has himself executed a Power of Attorney in favour of younger
brother 'J', member of HUF. Furthermore, there has been no protest, either by 'D' or by
any member of the HUF to the filing of the suit of eviction of tenant from HUF property
by 'J'. That apart it would not be open to the tenant to raise the question of maintainability
of the suit at the instance of 'J', as the record shows that 'J' has all along been realizing the
rent from the tenant and for this reason, the tenant is now estopped from raising any such
question. Therefore, the suit is maintainable at the instance of 'J' claiming himself to be
the Karta of the HUF. (Paras 6, 7)
(B) Civil P.C. (5 of 1908), S.100, O.41, R.31 - APPEAL - APPELLATE COURT - TRIAL
COURT - Second appeal - Finding arrived at by first Appellate Court affirming judgment
of Trial Court - Same found by High Court as neither very cryptic nor based on non-
consideration of arguments advanced by parties before it - And was in compliance with
O. - 41, C. P. C. - Not liable to be set aside. (Paras 8, 9)
(C) Delhi Rent Control Act (59 of 1958), S.6A, S.15 - HOUSES AND RENTS -
TENANCY - EVICTION - Rent - Increase in - Landlord can raise rent by 10% every
three years - Irrespective of fact that eviction proceedings is pending and order under S.
15 has been passed by Additional Rent Controller - However, notice of increase of rent
under S. 8 has to be served on tenant intimating him intention to make increase. (Para
10)
(D) Delhi Rent Control Act (59 of 1958), S.3(c), S.14 - HOUSES AND RENTS -
EVICTION - TENANCY - LEASE - Eviction - Suit pending against tenant - Landlord
increasing rent of tenanted premises after giving notice - Said notice was also notice to
quit - On said increase suit premises brought out of purview of Act in view of S. 3(c) -
Suit for eviction of tenant withdrawn by landlord - Filing of fresh suit for eviction of
tenant under general law - Issuance of notice to quit to tenant - Not necessary under S.
106, T. P. Act.
Transfer of Property Act (4 of 1882), S.106. (Paras 12, 13, 14)
Cases Referred : Chronological Paras
2006 AIR SCW 1098 : AIR 2006 SC 1471 (Rel. on) 7
2001 AIR SCW 723 : AIR 2001 SC 965 (Disting.) 8, 9
2001 AIR SCW 1804 : AIR 2001 SC 2171 : 2001 AIR Kant - HCR 2672 (Disting.)
9
2001 AIR SCW 3326 : AIR 2001 SC 3580 (Disting.) 13
@page-SC674

1994 AIR SCW 5011 (Ref.) 11


1991 AIR SCW 1467 : AIR 1991 SC 1538 (Foll.) 6, 7
AIR 1988 SC 576 (Disting.) 6, 7
AIR 1979 SC 1745 (Rel. on) 12
AIR 1976 SC 1953 (Rel. on) 7
Bhaskar P. Gupta, Sr. Advocate, Rana Mukherjee, Subodh K. Pathak, Ms. Geeta Luthra,
Shashi Ranjan, B. Patnaik, Ms. Pinky Anand and D. N. Gobardhan, for Appellant; Rajiv
Dutta, Sr. Advocate, Rajesh Goyal, Ms. Mandeep Kaur and V. P. Singh, for Respondent.
* RSA No. 209 of 2005, D/- 19-4-2007 (Del).
Judgement
1. TARUN CHATTERJEE, J. - :- Leave granted.
2. This appeal has been preferred before us, assailing the judgment and decree dated 19th
of April, 2007, passed by the High Court of Delhi, whereby, the High Court had
dismissed the appeal of the appellant, thereby affirming the judgments of the courts
below decreeing the eviction suit filed at the instance of the respondent against the
appellant.
3. The facts leading to the filing of this appeal may be stated as follows :
4. On 16th of July, 1980, the appellant entered into a lease with Dr. Santokh Singh HUF
for a period of 4 years, with respect to the property situated at N-112, Panchsheel Park,
New Delhi (for short "the suit premises"), at a monthly rent of Rs. - 3500/-. Accordingly,
at the expiry of the aforesaid period of 4 years, a notice of eviction dated 5th of April,
1984 was issued which was followed by filing an Eviction Petition No. 432 of 1984
before the Additional Rent Controller by Jasraj Singh, claiming himself to be the Karta of
Dr. Santokh Singh HUF. The Additional Rent Controller passed an order directing the
appellant for payment of rent at the rate of Rs. 3500/-. After coming into force of Section
6A of the Delhi Rent Control Act, a notice dated 9th of January, 1992 was sent by Jasraj
Singh, in the above capacity, to the appellant for enhancement of rent by 10 per cent and
also termination of tenancy of the appellant. In reply to this notice, the appellant denied
the right of the respondent to enhance the rent. Another notice dated 31st of March, 1992
was sent afresh by the respondent notifying the appellant that the rent stood enhanced by
10 per cent while the tenancy stood terminated w.e.f. 16/17th of July, 1992. The aforesaid
Eviction Petition No. 432 of 1984 was withdrawn on 20th of August, 1992 by Jasraj
Singh. Thereafter, a notice dated 3rd of September, 1992 was sent by Jasraj Singh asking
the appellant to vacate the suit property to which the appellant did not concede and
refused to vacate the same by a reply dated 24th of September, 1992. On 6th of February,
1993, Dr. Santokh Singh HUF, through Jasraj Singh, claiming himself to be the Karta of
the HUF, instituted a suit seeking eviction of the appellant from the suit premises. The
trial court decreed the respondent's suit for possession, against which an appeal was
preferred before the Additional District Judge, Delhi. The first appellate court dismissed
the appeal summarily. Against this order of the first appellate court, a second appeal,
being R.S.A. No. 146 of 2003, was preferred before the High Court of Delhi, which
remanded the matter to the first appellate court for fresh consideration. In pursuance of
this direction of the High Court, the first appellate court, after fresh consideration of the
matter, affirmed the judgment passed by the Trial Court thereby dismissing the appeal of
the appellant herein. Being aggrieved and dissatisfied with the order of the first appellate
court, the appellant preferred a second appeal, being R.S.A. No. 209 of 2005, before the
High Court of Delhi, which, however, was also dismissed. It is this decision of the High
Court of Delhi, which is impugned in this appeal and in respect of which leave has
already been granted.
5. The pivotal questions, inter alia, in the facts and circumstances of this case, which
warrant our determination are as follows - :
(i) Whether Jasraj Singh could file the suit for eviction, in the capacity of the Karta of Dr.
Santokh Singh HUF, when, admittedly, an elder member of the aforesaid HUF was alive -
?
(ii) Whether the High Court was right in concluding that the first appellate court had duly
dealt with all the issues involved and re-appreciated evidence as provided under O.41,
R.31 of the Code of Civil Procedure (in short "the CPC") - ?
(iii) Whether the contractual tenancy between the landlord and tenant came to an end
merely by filing an Eviction Petition and whether the landlord could seek enhancement of
rent simultaneously or post-termination of tenancy - ?
@page-SC675
(iv) Whether the landlord could issue a notice under Section 6A of the Delhi Rent Control
Act, 1958 (in short "the Act") for increase of rent without seeking leave of the Rent
Controller during the pendency of an order under Section 15 of the Act directing the
tenant to deposit rent on a month to month basis - ?
6

. We have heard the learned counsel for the parties. As regards the first issue, as noted
hereinabove, the learned senior counsel Mr. Gupta appearing on behalf of the appellant
had questioned the maintainability of the suit filed at the instance of Jasraj Singh,
claiming himself to be the Karta of Dr. Santokh Singh HUF. The learned counsel Mr.
Gupta strongly argued before us that in view of the settled principle of law that the junior
member in a joint family cannot deal with the joint family property as Karta so long as
the elder brother is available, the respondent herein, who is admittedly a junior member
of the family, could not have instituted the eviction suit, claiming himself to be the Karta
of the family. In support of this argument, the learned senior counsel Mr. Gupta has
placed reliance on the decisions of this court in Sunil Kumar and another v. Ram Prakash
and others [(1988) 2 SCC 77] and Tribhovan Das Haribhai Tamboli v. Gujarat Revenue
Tribunal and others [(1991) 3 SCC 442]. Before we look at the views expressed by the
High Court on this question, it would be pertinent to note the ratios of the two authorities
cited before us. In Sunil Kumar and another v. Ram Prakash and others [supra], this court
held as follows - :- AIR 1988 SC 576
1991 AIR SCW 1467
AIR 1988 SC 576, (Para 21)

"In a Hindu family, the Karta or Manager occupies a unique position. It is not as if
anybody could become Manager of a joint Hindu family. As a general rule, the father of a
family, if alive, and in his absence the senior member of the family, is alone entitled to
manage the joint family property."
From a reading of the aforesaid observation of this court in Sunil Kumar and another v.
Ram Prakash and others [supra], we are unable to accept that a younger brother of a joint
Hindu family would not at all be entitled to manage the joint family property as the Karta
of the family. This decision only lays down a general rule that the father of a family, if
alive, and in his absence the senior member of the family would be entitled to manage the
joint family property. Apart from that, this decision was rendered on the question whether
a suit for permanent injunction, filed by co-parcerners for restraining the Karta of a joint
Hindu family from alienating the joint family property in pursuance of a sale agreement
with a third party, was maintainable or not. While considering that aspect of the matter,
this court considered as to when could the alienation of joint family property by the Karta
be permitted. Accordingly, it is difficult for us to agree with Mr. Gupta, learned senior
counsel appearing for the appellant, that the decision in Sunil Kumar and another v. Ram
Prakash and others [supra] would be applicable in the present case which, in our view,
does not at all hold that when the elder member of a joint Hindu family is alive, the
younger member would not at all be entitled to act as a Manager or Karta of the joint
family property.

In Tribhovandas's case [supra], this court held as follows - : 1991 AIR SCW 1467, (Para
13)

"The managership of the joint family property goes to a person by birth and is regulated
by seniority and the Karta or the Manager occupies a position superior to that of the other
members. A junior member cannot, therefore, deal with the joint family property as
manager so long as the Karta is available except where the Karta relinquishes his right
expressly or by necessary implication or in the absence of the Manager in exceptional and
extraordinary circumstances such as distress or calamity affecting the whole family and
for supporting the family or in the absence of the father whose whereabouts were not
known or who was away in remote place due to compelling circumstances and that his
return within the reasonable time was unlikely or not anticipated."
(Emphasis supplied)
From a careful reading of the observation of this court in Tribhovandas's case [supra], it
would be evident that a younger member of the joint Hindu family can deal with the joint
family property as Manager in the following circumstances - :-
(i) if the senior member or the Karta is not available;
(ii) where the Karta relinquishes his right expressly or by necessary implication;
@page-SC676
(iii) in the absence of the manager in exceptional and extraordinary circumstances such as
distress or calamity affecting the whole family and for supporting the family;
(iv) in the absence of the father - :-
(a) whose whereabouts were not known, or
(b) who was away in a remote place due to compelling circumstances and his return
within a reasonable time was unlikely or not anticipated.
Therefore, in Tribhovandas's case [supra], it has been made clear that under the aforesaid
circumstances, a junior member of the joint Hindu family can deal with the joint family
property as manager or act as the Karta of the same.
7. From the above observations of this court in the aforesaid two decisions, we can come
to this conclusion that it is usually the Father of the family, if he is alive, and in his
absence the senior member of the family, who is entitled to manage the joint family
property. In order to satisfy ourselves whether the conditions enumerated in
Tribhovandas's case [supra] have been satisfied in the present case, we may note the
findings arrived at by the High Court, which are as follows - :-
(i) Jasraj Singh, in his cross-examination before the trial court had explained that his
eldest brother Dhuman Raj Singh (supposed to be the Karta of the HUF) has been living
in United Kingdom for a long time. Therefore, the trial court had rightly presumed that
Dhuman Raj Singh was not in a position to discharge his duties as Karta of the HUF, due
to his absence from the country.
(ii) The respondent produced the Xerox copy of the power of attorney given by Dhuman
Raj Singh to Jasraj Singh.
(iii) The trial court relied upon the law discussed in the books namely, "Principles of
Hindu Law" by Mulla and Mulla and "Shri S.V. Gupta on Hindu Law", wherein it has
been observed that ordinarily, the right to act as the Karta of HUF is vested in the senior-
most male member but in his absence, the junior members can also act as Karta.
(Emphasis supplied)
(iv) There was no protest by any member of the joint Hindu family to the filing of the suit
by Jasraj Singh claiming himself to be the Karta of the HUF. There was also no whisper
or protest by Dhuman Raj Singh against the acting of Jasraj Singh as the Karta of the
HUF.

It may also be noted that the High Court relied on the decision of this court in
Narendrakumar J. Modi v. Commissioner of Income Tax, Gujarat II, Ahmedabad [(AIR)
1976 SC 1953], wherein it was held that so long as the members of a family remain
undivided, the senior member of the family is entitled to manage the family
properties ................. and is presumed to be manager until contrary is shown, but the
senior member may give up his right of management, and a junior member may be
appointed manager. Another decision in Mohinder Prasad Jain v. Manohar Lal Jain [2006
II AD (SC) 520], was also relied upon by the High Court wherein it has been held at
paragraph 10 as follows - : 2006 AIR SCW 1098, (Para 11)

"10. A suit filed by a co-owner, thus, is maintainable in law. It is not necessary for the co-
owner to show before initiating the eviction proceeding before the Rent Controller that he
had taken option or consent of the other co-owners. However, in the event, a co-owner
objects thereto, the same may be a relevant fact. In the instant case, nothing has been
brought on record to show that the co-owners of the respondent had objected to eviction
proceedings initiated by the respondent herein."
Having relied on the aforesaid decisions of this Court and a catena of other decisions and
the findings arrived at by it, as noted hereinabove, the High Court rejected the argument
of the appellant that Jasraj Singh could not have acted as the Karta of the family as his
elder brother, namely, Dhuman Raj Singh, being the senior most member of the HUF,
was alive. In view of our discussions made herein-earlier and considering the principles
laid down in Tribhovandas's case [supra] and Sunil Kumar's case [supra], we neither find
any infirmity nor do we find any reason to differ with the findings arrived at by the High
Court in the impugned judgment. It is true that in view of the decisions of this court in
Sunil Kumar's case [supra] and Tribhovandas's case [supra], it is only in exceptional
circumstances, as noted herein earlier, that a junior member can act as the Karta of the
family. But we venture to mention here that Dhuman Raj Singh, the senior member of the
HUF, admittedly, has been staying permanently in the United Kingdom for a long time. In
@page-SC677
Tribhovandas's case [supra] itself, it was held that if the Karta of the HUF was away in a
remote place, (in this case in a foreign country) and his return within a reasonable time
was unlikely, a junior member could act as the Karta of the family. In the present case,
the elder brother Dhuman Raj Singh, who is permanently staying in United Kingdom
was/is not in a position to handle the joint family property for which reason he has
himself executed a power of attorney in favour of Jasraj Singh. Furthermore, there has
been no protest, either by Dhuman Raj Singh or by any member of the HUF to the filing
of the suit by Jasraj Singh. That apart, in our view, it would not be open to the tenant to
raise the question of maintainability of the suit at the instance of Jasraj Singh as we find
from the record that Jasraj Singh has all along been realizing the rent from the tenant and
for this reason, the tenant is now estopped from raising any such question. In view of the
discussions made hereinabove, we are, therefore, of the view that the High Court was
fully justified in holding that the suit was maintainable at the instance of Jasraj Singh,
claiming himself to be the Karta of the HUF.
8. This takes us to the next issue namely, whether the High Court was right in concluding
that the first appellate court had duly dealt with all the issues involved and re-appreciated
the evidence as provided under O.41, R.31 of the CPC. The learned senior counsel for the
appellant Mr. Gupta sought to argue that the High Court had erred in holding that the first
appellate court had acted in due compliance with O.41 of the CPC. It may be noted that
the High Court, while concluding as aforesaid, came to the following findings - :-
1) The first appellate court has passed a speaking order and it is apparent that it has
applied its mind.
2) The First appellate court had to deal with the arguments which were advanced before
it. It had rightly given the short shrift to all those arguments which did not inject some
coherence.
3) The learned counsel for the appellant had failed to point out the issues regarding which
the First Appellate Court had not given its own conclusion.

4) The learned counsel for the appellant had also failed to show as to how the authority
cited viz., Santosh Hazari vs. Purushottam Tiwari (dead) by L.Rs. [AIR 2001 SC 965]
was applicable to the facts of the case. 2001 AIR SCW 723

. In our view, it is difficult for us to set aside the findings of the High Court on the
question whether the first appellate court, while deciding the questions of fact and law,
had complied with the requirements under O.41 of the CPC. We are in agreement with
the findings of the High Court as on a perusal of the judgment of the first appellate court,
it does not appear to us that the findings arrived at by the first appellate court affirming
the judgment of the trial court on any issue were either very cryptic or based on non-
consideration of the arguments advanced by the parties before it. In support of this
contention, before the High Court, the appellant had relied on a decision of this court in
the case of Santosh Hazari [supra], but in this appeal, the learned senior counsel for the
appellant Mr. Gupta has strongly relied on a decision of this court in the case of
Madhukar and Ors. vs. Sangram and Ors. [(2001) 4 SCC 756] and contended that since
the judgment of the first appellate court was cryptic in nature and the first appellate court
had not dealt with the issues involved in the appeal, the same was liable to be set aside
and the matter was liable to be sent back to the first appellate court for rehearing. We are
unable to accept this contention of the learned senior counsel for the appellant. Before we
consider the findings of the first appellate court as well as the High Court on this issue,
we must keep on record that in Madhukar and Ors. vs. Sangram and Ors. [supra], this
court had to reverse the findings of the High Court because the High Court erred in
allowing the plaintiff/respondent's first appeal without even considering the grounds on
which the trial court had dismissed the suit and without discussing the evidence on
record. On the same lines, the decision of this court in Santosh Hazari's case [supra] was
based. In our view, the aforesaid two decisions of this court are distinguishable on facts
with the present case. A perusal of the judgment of the first appellate court after remand
would clearly indicate that the same was neither cryptic nor based on non-consideration
of the issues involved in the appeal. Apart from that, it has to be kept in mind that the
decisions of this court in Madhukar and Ors. vs. Sangram and Ors. [supra] and Santosh
Hazari's case 2001 AIR SCW 1804
2001 AIR SCW 723, (Para 15)

@page-SC678
[supra], were considering the reversal of the findings of fact of the trial court. In the
present case, the first appellate court had affirmed the findings of the trial court, which
were based on total consideration of the material evidence - documentary and oral on
record. It is well settled that in the case of reversal, the first appellate court ought to give
some reason for reversing the findings of the trial court whereas in the case of
affirmation, the first appellate court accepts the reasons and findings of the trial court. In
any view of the matter, from a perusal of the judgment of the first appellate court, it is
clear that it reflects conscious application of mind and has recorded the findings
supported by reason on all the issues arising along with the contentions put forward by
the parties. In Santosh Hazari's case [supra], this court observed:-
"The task of an appellate court affirming the findings of the trial court is an easier one.
The appellate court agreeing with the view of the trial court need not restate the effect of
the evidence or reiterate the reasons given by the trial court; expression of general
agreement with the reasons given by the court, decision of which is under appeal, would
ordinarily suffice."
(Emphasis supplied).
Again, in Madhukar and Ors. vs. Sangram and Ors. [supra], this court had to set aside the
judgment of the High Court because the first appellate court was singularly silent as to
any discussion, either of the documentary or the oral evidence. In addition, this court in
that decision was of the view that the findings of the first appellate court were so cryptic
that none of the relevant aspects were noticed. In this background, this court at paragraph
8 observed as follows - :-
"Our careful perusal of the judgment in the first appeal shows that it hopelessly falls short
of considerations which are expected from the court of first appeal. We, accordingly set
aside the impugned judgment and decree of the High Court and remand the first appeal to
the High Court for its fresh disposal in accordance with law."
In view of our discussions made hereinabove, we are, therefore, unable to agree with the
learned senior counsel for the appellant Mr. Gupta that the High Court was not justified in
holding that the findings of the first appellate court were in compliance with O.41 of the
CPC. That apart, the learned senior counsel for the appellant Mr. Gupta could not satisfy
us or even point out the specific issues which, in his opinion, had been left to be
addressed by the first appellate court. In view of the discussions made hereinabove, we
are, therefore, of the view that no ground was made out by the appellant to set aside the
judgment of the High Court on the question whether the judgment of the first appellate
court was liable to be set aside for non-compliance with the mandatory provisions of
O.41 of the CPC.
10. Let us now deal with Issue Nos. 3 and 4. Since both these issues are interlinked, we
shall deal with these two issues together. Let us first consider whether the respondent
landlord could issue a notice under Section 6A of the Act for increase of rent when the
petition for eviction of the appellant was pending before the Additional Rent Controller
and when there had been an order to the tenant for deposit of rent on a month to month
basis under Section 15 of the Act. In our view, the first appellate court as well as the High
Court were fully justified in holding that it was open to a landlord to increase the rent of
the suit premises by 10% after giving a notice under section 6A of the Act. In this
connection, it would be appropriate to reproduce Section 6A of the Act which talks about
revision of rent and Section 8 of the Act which contemplates notice of increase of rent.
Section 6A runs as under - :-
"6A. Revision of rent - Notwithstanding anything contained in this Act, the standard rent,
or, where no standard rent is fixed under the provisions of this Act in respect of any
premises, the rent agreed upon between the landlord and the tenant, may be increased by
ten per cent every three years."
From a bare perusal of this provision under Section 6A of the Act, it is evident that by
this statutory provision, the standard rent and in cases where no standard rent is fixed
under the Act in respect of any premises, the rent agreed upon between the landlord and
the tenant, may be increased by 10% every three years. It is, therefore, open to the
landlord under Section 6A of the Act to increase the rent agreed upon between him and
the tenant by 10 % every three years, irrespective of the fact that an eviction proceeding
is pending and an order under Section 15 of the Act has been passed by the Additional
Rent Controller except that when a landlord wishes to so increase the rent of
@page-SC679
any premises, a notice of increase of rent, as provided under Section 8 of the Act, has to
be served on the tenant thereby intimating the tenant his intention to make the increase.
Section 8 of the Act runs as under:-
"Notice of increase of rent - (1) Where a landlord wishes to increase the rent of any
premises, he shall give the tenant notice of his intention to make the increase and in so far
as such increase is lawful under this Act, it shall be due and recoverable only in respect of
the period of the tenancy after the expiry of thirty days from the date on which the notice
is given.
(2) Every notice under sub-section (1) shall be in writing signed by or on behalf of the
landlord and given in the manner provided in section 106 of the Transfer of Property Act,
1882 (4 of 1882)."
Therefore, if the landlord wishes to increase the rent of any premises at any time, only a
notice expressing his intention to make such increase is required to be given to the tenant
and Section 6A of the Act, as noted herein earlier, clearly permits the landlord to increase
the rent by 10% every three years. In this view of the matter, after the completion of three
years, it was open to the landlord at any point even during the pendency of an eviction
petition to increase the rent of the suit premises after giving the prescribed notice to the
tenant.
11. At this stage, we may also consider Section 3(c) of the Act, which bars the application
of the Act to the premises whose monthly rent exceeds Rs. 3500/-. Section 3(c) of the Act
runs as under - :-
"Act not to apply to certain premises - Nothing in this Act shall apply-
(a) ..................
(b) ................
(c) to any premises, whether residential or not, whose monthly rent exceeds three
thousand and five hundred rupees;"

The Delhi Rent Control Act, 1958 was amended by Act No. 52 of 1988, which came into
effect from 1st of December, 1988. By this amendment of the 1958 Act on 1st of
December, 1988, Section 3(c) with other amendments was brought into force. Section
3(c) of the amended act provides that the provisions of the Act will not apply to any
premises whose monthly rent exceeds Rs. 3500/- from the date of coming into operation
of this Act. In D.C. Bhatia and others Vs. Union of India and another [(1995) 1 SCC
104], while considering the parent Act and the amending Act, this court held that the
objects of the amending Act are quite different from the objects of the parent Act. It
observed that one of the objects of the amending Act was to rationalize the rent control
law by bringing about a balance between the interest of landlords and tenants. It was also
observed that the object was not merely to protect the weaker section of the community.
The Rent Act had brought to a halt house-building activity for letting out. This court also
made an observation that many people with accommodation to spare did not let out the
accommodation for the fear of losing the accommodation. As a result of all these, there
was acute shortage of accommodation which caused hardship to the rich and the poor
alike and that in the background of this experience, the amending Act of 1988 was
passed. In paragraph 28 of the aforesaid decision in D.C. Bhatia's case [supra], this court
observed as follows - :- 1994 AIR SCW 5011

"In order to strike a balance between the interests of the landlords and also the tenants
and for giving a boost to house-building activity, the legislature in its wisdom has decided
to restrict the protection of the Rent Act only to those premises for which rent is payable
up to the sum of Rs 3500 per month and has decided not to extend this statutory
protection to the premises constructed on or after the date of coming into operation of the
Amending Act for a period of ten years. This is a matter of legislative policy. The
legislature could have repealed the Rent Act altogether. It can also repeal it step by step.
It has decided to confine the statutory protection to the existing tenancies whose monthly
rent did not exceed Rs. 3500."
Considering the aforesaid reasons which led to the amending Act of 1988, it is clear that
the legislature intended to strike a balance by allowing the landlords to evict a tenant,
who could pay more than Rs. 3500/- per month, from the tenanted premises.
12. In the present case, after serving a notice under Section 6A read with Section 8 of the
Act, the protection of the tenant under the Act automatically ceased to exist as the rent of
the tenanted premises exceeded Rs. 3500/- and the bar of Section 3(c) came into play. At
the risk of repetition, since, in the present case, the increase of rent by 10% on the rent
agreed upon between the
@page-SC680
appellant and the respondent brought the suit premises out of the purview of the Act in
view of Section 3(c) of the Act, it was not necessary to take leave of the rent controller
and the suit, as noted herein above, could be filed by the landlord under the general law.
The landlord was only required to serve a notice on the tenant expressing his intention to
make such increase. When the eviction petition was pending before the Additional Rent
Controller and the order passed by him under Section 15 of the Act directing the
appellant to deposit rent at the rate of Rs. 3500/- was also subsisting, the notice dated 9th
of January, 1992 was sent by the respondent to the appellant intimating him that he
wished to increase the rent by 10 per cent. Subsequent to this notice, another notice dated
31st of March, 1992 was sent by the respondent intimating the appellant that by virtue of
the notice dated 9th of January, 1992 and in view of Section 6A of the Act, the rent stood
enhanced by 10 per cent i.e. from Rs. 3500/- to Rs. 3850/?. It is an admitted position that
the tenancy of the appellant was terminated by a further notice dated 16/17th of July,
1992. Subsequent to this, the eviction petition No. 432 of 1984 was withdrawn by the
respondent on 20th of August, 1992 and the suit for eviction, out of which the present
appeal has arisen, was filed on 6th of February, 1993. That being the factual position, it
cannot at all be said that the suit could not be filed without the leave of the Additional
Rent Controller when, admittedly, at the time of filing of the said suit, the eviction
petition before the Additional Rent Controller had already been withdrawn nor can it be
said that the notice of increase of rent and termination of tenancy could not be given
simultaneously, when, in fact, the notice dated 16/17th of July, 1992 was also a notice to
quit and the notice intending increase of rent in terms of Section 6A of the Act was earlier
in date than the notice dated 16/17th of July, 1992. In any view of the matter, it is well
settled that filing of an eviction suit under the general law itself is a notice to quit on the
tenant. Therefore, we have no hesitation to hold that no notice to quit was necessary
under Section 106 of the Transfer of Property Act in order to enable the respondent to get
a decree of eviction against the appellant. This view has also been expressed in the
decision of this court in V. Dhanapal Chettiar Vs. Yesodai Ammal [AIR 1979 SC 1745].
13

. Before parting with this judgment, we may deal with a decision of this court in the case
of Ambalal Sarabhai Enterprises Ltd. Vs. Amrit Lal and Co. and another [(2001) 8 SCC
397] on which the learned senior counsel for the appellant Mr. Gupta placed strong
reliance. Relying on this decision, Mr. Gupta sought to argue that the amendment of the
Act being not retrospective in operation, in view of Section 6 of the General Clauses Act,
it would not affect the pending eviction proceeding, which would continue as if the Act
had not been amended and therefore, the suit filed by the respondent for eviction under
the general law without taking leave from the Additional Rent Controller could not be
said to be maintainable. In our view, the decision of this court in Ambalal Sarabhai's case
[supra] does not support the appellant but it supports the respondent. In that decision, this
court held that the vested right of the landlord under the general law continues so long it
is not abridged by the protective legislation, namely, the Rent Act, but the moment this
protection is withdrawn, the vested right of the landlord reappears which can be enforced
by him. Such being the position, we are, therefore, of the view that since the eviction
petition filed by the respondent before the Additional Rent Controller was withdrawn and
the tenancy was terminated by a fresh notice to quit and in view of the increase of rent
wished by the landlord in compliance with Section 6A read with Section 8 of the Act,
there cannot be any difficulty to hold that the suit in fact was maintainable under the
general law. That being the position, the decision of this court in Ambalal Sarabhai's case
[supra] cannot at all be applicable in favour of the appellant and which, in view of our
discussions made hereinabove, can only be applicable in favour of the respondent. 2001
AIR SCW 3326

14. For the reasons aforesaid, none of the grounds urged by the learned senior counsel for
the appellant Mr. Gupta can be accepted by us to interfere with the impugned judgment of
the High Court. Accordingly, the appeal fails and is hereby dismissed. However,
considering the facts and circumstances of the case, we grant time to the appellant to
vacate the premises in question by 29th of February, 2008 provided the appellant files an
usual undertaking in this regard in this court within a fortnight from this date. In default,
it will be open
@page-SC681
to the respondent to proceed to execute the decree for eviction of the appellant from the
suit premises in accordance with law. There will be no order as to costs.
Appeal dismissed.
AIR 2008 SUPREME COURT 681 "Magna Publishing Co. Ltd. v. Shilpa S. Shetty"
(From : Bombay)*
Coram : 2 Dr. A. PASAYAT AND P. SATHASIVAM, JJ.
Civil Appeal No. 344 of 2002, D/- 14 -12 -2007.
Magna Publishing Co. Ltd. and Ors. v. Shilpa S. Shetty.
Constitution of India, Art.133 - Civil P.C. (5 of 1908), O.39, R.1 - APPEAL -
INJUNCTION - DEFAMATION - Appeal - Against interim order - Interim order passed
in suit for defamation against magazine - Publisher restrained from re-publishing articles
in question or writing any defamatory article in future - Court refused to interfere - Suit
directed to be disposed of early. (Para 11)

E. C. Agrawala, Mahesh Agarwal, Rishi Agrawala, Amit Kumar Sharma, for Appellants;
S. K. Bhattacharya, for Respondent.
* Appeal No. 128 of 2001 in notice of Motion No. 25 of 2001 in Suit No. 36 of 2001,D/-
16-7-2001 (Bom).
Judgement
1. Dr. ARIJIT PASAYAT, J. - :-Heard learned counsel for the parties.
2. It appears that vide an interim order dated 12.1.2001, the High Court granted ad
interim injunction and a Division Bench of the Bombay High Court refused to interfere.
3. A brief reference to the factual aspects would suffice - :
4. The respondent filed a suit claiming that she is a film actress of good standing. Certain
articles were published in the magazine published by the appellants called Stardust. A suit
for damages of Rs.20 crores alleging that the articles are defamatory in nature and would
affect her career and for injunction restraining the appellants from publishing defamatory
articles was filed. Notice of motion for interim injunction was taken out. Learned Single
Judge was of the prima facie view that the articles deal with the personal life and are
defamatory in nature and granted interim injunction. The interim injunction reads as
follows - :
"Therefore, as directed in the case of Indian Express Newspapers (supra), a modified
injunction is hereby granted restraining the defendants from republishing the three
articles and/or from writing and publishing any defamatory article in the nature of the
three articles alleging that the plaintiff is having relationship with other actors or a
married man, which will operate till the disposal of the suit."
5. The said order dated 12.01.2001, as noted above, was challenged in appeal.
6. Before the Division Bench, the stand was that the interim injunction granted was
beyond the prayer made in the notice of motion. The High Court noted that in notice of
motion, the prayer was in the following terms - :
"That pending the hearing and final disposal of the suit, this Hon'ble Court be pleased to
issue an order and injunction restraining the defendants from in any way or manner
carrying out defamatory, allegations and imputations in future against the plaintiff".
7. The Division Bench was of the further view that the Learned Single Judge had not
granted interim protection beyond what was prayed and was covered by the prayer.
8. The other stand before the Division Bench was that moment justification is pleaded,
there can be no interim protection. This plea was also rejected stating that a person cannot
be defamed by allowing such publications in future. Justification shall be required to be
established at the time of hearing of the suit by leading evidence.
9. There were certain other stands relating to lack of pleadings about the reputation and
character. The Division Bench found that also to be without substance. The appeal was
accordingly dismissed.
10. Learned counsel for the appellant reiterated the stand taken before the Division
Bench. Mr. Bhattacharya, learned counsel for the respondent supported the order.
11. We find that the matter relates to an interim order and while granting leave, the prayer
for grant of interim relief was refused. In other words, interim order passed by learned
Single Judge as upheld by the Division Bench continues to be operative. Therefore,
without expressing any opinion on the merits of the case, we think it proper to dispose of
the appeal without interference. We,
@page-SC682
however, request the High Court to explore the possibility of early disposal of the suit
No.36/2001.
12. The appeal is disposed of accordingly.
Order accordingly.
AIR 2008 SUPREME COURT 682 "Sewa Ram v. State of U. P."
(From : 2005 All LJ 2830)
Coram : 2 Dr. A. PASAYAT AND AFTAB ALAM, JJ.
Criminal Appeal No. 1695 of 2007 (arising out of SLP (Cri.) No. 5400 of 2005), D/- 11
-12 -2007
Sewa Ram and Anr. v. State of U.P.
(A) Penal Code (45 of 1860), S.34 - COMMON INTENTION - Common intention - S.
34 has been enacted on principle of joint liability in doing of a criminal act - Section is
only a rule of evidence and does not create a substantive offence - Distinctive feature of
section is element of participation in action. (Para 12)
(B) Penal Code (45 of 1860), S.34 - COMMON INTENTION - Common intention -
Direct proof of common intention is seldom available - Such intention can only be
inferred from circumstances appearing from proved facts of case. (Para 12)
(C) Penal Code (45 of 1860), S.34 - COMMON INTENTION - Common intention - True
concept of section is that if two or more persons intentionally do an act jointly, position in
law is just the same as if each of them has done it individually by himself.
AIR 1977 SC 109, Relied on. (Para 12)
(D) Penal Code (45 of 1860), S.34 - COMMON INTENTION - Common intention -
Section does not say "the common intentions of all", nor does it say "an intention
common to all" - Under provisions of S. 34, essence of liability is to be found in
existence of a common intention animating accused leading to doing of a criminal act in
furtherance of such intention. (Para 13)
(E) Penal Code (45 of 1860), S.34 - COMMON INTENTION - Common intention -
Provision is intended to meet a case in which it may be difficult to distinguish between
acts of individual members of a party who act in furtherance of common intention of all
or to prove exactly what part was taken by each of them.
1993 AIR SCW 1843 and 2004 AIR SCW 810, Relied on. (Para 13)
(F) Penal Code (45 of 1860), S.300, S.34 - COMMON INTENTION - MURDER -
EVIDENCE - Murder case - Common intention - Application of principles enunciated in
S. 34 - Accused persons allegedly assaulted deceased with lathis and kanta - Evidence of
eye-witnesses suffered from no infirmity - Accused had common intention to murder
deceased due to enmity arising out of litigation pending between them - Conviction of
accused in terms of S. 302 r/w S. 34 is proper. (Paras 10, 15)
Cases Referred : Chronological Paras
2004 AIR SCW 810 : AIR 2004 SC 1808 : 2004 Cri LJ 1388 : 2004 All LJ 683 (Rel. on)
14
1993 AIR SCW 1843 : AIR 1993 SC 1899 : 1993 Cri LJ 2246 (Rel on) 13
AIR 1977 SC 109 : 1977 Cri LJ 164 (Rel. on) 12
Balraj Dewan, for Appellants; Sahdev Singh, Sandeep Singh and Anuvrat Sharma, for
Respondent.
Judgement
Dr. ARIJIT PASAYAT, J. - :-Leave granted.
2. Challenge in this appeal is to the judgment rendered by a Division Bench of the
Allahabad High Court dismissing the appeal filed by the appellants. Before the High
Court three persons had filed the appeal. During the pendency of the appeal, appellant
No.2 Ram Prasad died. Therefore, the appeal was held to have abetted so far he is
concerned.
3. The appellants were found guilty of having committed an offence punishable under
Section 302 read with Section 34 of the Indian Penal Code, 1860 (in short 'IPC') and each
was sentenced to undergo imprisonment for life. Appellant-Sewa Ram and the deceased-
accused Ram Prasad were further convicted for offence punishable under Section 323
read with Section 34 IPC and each was sentenced to undergo RI for six months and to
pay a fine of Rs.500/- with default stipulation.
@page-SC683
4. The conviction was recorded by IV learned Additional Sessions Judge, Pillibhit, in
Sessions Trial No. 249 of 1980.
5. Prosecution version as unfolded during trial is as follows - :
The complainant Shaukat Ali, son of Nathu Bux, resident of Barhara, P.S. Bisalpur, was
doing service at the house of Jagan Nath Prasad resident of village Chandpura who was
related to Smt. Genda Devi, widow of Jwala Prasad Kurmi, resident of Naugamia, P.S.
Bilsanda, who is hereinafter referred to as the 'deceased'. Litigation was going on
between Smt. Genda Devi and her step daughter Smt. Savitri Devi, who was living as
wife of Ram Prasad of village Naugamia. On 22.8.1980, the complainant Shaukat Ali
along with Jagan Nath and Smt. Genda Devi had gone to Tehsil Bisalpur in connection
with the litigation and they were returning from Tehsil to village Chandpura at about 4
O'clock and when they reached the outskirts of village Kangawan near the sugar cane
field of Babuji at 6 O'clock Smt. Genda Devi was going ahead; behind her was the
complainant and behind him was Jagan Nath. Suddenly accused Ram Prasad, Sewa Ram
and Parmeshwari having 'Lathis' in their hands and accused Sunder Lal having 'Kanta' in
his hand suddenly came out from the sugar cane field and began to beat Smt. Genda Devi
on which the complainant and Jagan Nath cried for help. Accused Ram Prasad and Sewa
Ram then beat the complainant with 'Lathis'. The complainant and Jagan Nath ran away
towards the village Kangavan and the accused ran away towards east. The complainant
and Jagan Nath saw Smt. Genda Devi and found that she had died in the paddy field. The
accused persons had murdered Smt. Genda Devi due to enmity of litigation. Thereafter
the complainant informed the residents of village Chandpura and the 'Chaukidar',
Pradhan and other people of the village, who came with the complainant to the spot. It
had fallen dark and due to fear, he at once did not come to the police station to lodge the
F.I.R. and remained sitting the whole night looking after the dead body. In the next
morning on 23.8.1980, the complainant lodged the F.I.R.(Ex. Ka. 3) at the Bisalpur police
station. The crime was registered as crime No. 247 under Sections 302/323 I.P.C. at the
Bisalpur police station and the S.O. Ram Lakhan Singh was entrusted with the
investigation of the case. The details were entered in the G.D., a copy of which is Ex.Ka.
4. The I.O. along with the S.I. Sahabdin arrived at the spot and prepared inquest report
(Ex. Ka. 8) of the dead-body of Smt. Genda Devi. The dead-body was sealed and sample
seal was preserved, which is Ex. Ka. 11. The I.O. made spot inspection and prepared the
site-plan Ex. Ka. 5. The post mortem of the dead-body of Smt. Genda Devi was
conducted by Dr. V.P. Agarwal. The complainant Shaukat Ali who received injuries was
also examined at the P.H.C. Bisalpur. His injury report is Ex. Ka.1. After completion of
the investigation, the I.O. submitted charge-sheet against the accused persons.
Finding a prima facie case against the accused persons, they were charged under Section
302 read with Section 34 I.P.C. and Section 323 read with Section 34 I.P.C. The charges
were read over and explained to the accused persons who pleaded not guilty and claimed
to be tried.
In support of the prosecution version Shaukat Ali, (P.W.1), Dr. C.K. Chaturvedi (PW2)
who conducted the medical examination of Shaukat Ali and Jagan Nath (P.W.3), Dr. V.P.
Agarwal, (PW 4) who conducted post mortem of the deceased Smt. Genda Devi, A.C.
Pancham Singh (PW 5), Constable Rampal Sharma, (PW 6) and S.I. Ramlakhan Singh
(PW 7) who conducted investigation were produced. The accused were examined who
denied the allegations and contended that they have been falsely implicated in this case
due to enmity.
6. Shaukat Ali the informant (PW1) and Jagan Nath (PW-3) claimed to be eye-witnesses.
The trial Court relying on the version of the eye-witnesses recorded conviction and
imposed sentence as aforesaid. Before the High Court the stand was that there was
inordinate delay in dispatching special report to the Magistrate. In addition, it was
submitted that the doctor who conducted the post-mortem noticed seven injuries and out
of them three were incised wounds and injury 3, 4, 5, and 7 were lacerated wounds. It
was submitted that the three accused persons who preferred appeal before the High Court
were holding lathies and the Kanthi was held by Sewa Ram who had been acquitted.
Therefore, it was submitted that offence under Section 302 IPC was not made out.
7. The case of the prosecution was that in view of the factual background offence
@page-SC684
punishable under Section 302 read with Section 34 IPC is made out. The High Court, as
noted above, dismissed the appeal filed by the appellants.
8. In support of the appeal learned counsel for the appellant submitted that even if
prosecution version is accepted in totality, offence under Section 302 is not made out,
much less by application of Section 34 IPC.
9. Learned counsel for the respondent-State supported the judgment of the High Court.
10. As rightly held by the High Court the evidence of the eye-witnesses PWs 1 and 3
suffered from no infirmity. The trial Court was, therefore, justified in convicting and
holding appellants guilty.
11. So far as the question as to whether Section 302 will be applied so far as appellants
are concerned, it is to be noted that the trial Court and the High Court considered their
cases in the background of Section 34, IPC.
12

. Section 34 has been enacted on the principle of joint liability in the doing of a criminal
act. The section is only a rule of evidence and does not create a substantive offence. The
distinctive feature of the section is the element of participation in action. The liability of
one person for an offence committed by another in the course of criminal act perpetrated
by several persons arises under Section 34 if such criminal act is done in furtherance of a
common intention of the persons who join in committing the crime. Direct proof of
common intention is seldom available and, therefore, such intention can only be inferred
from the circumstances appearing from the proved facts of the case and the proved
circumstances. In order to bring home the charge of common intention, the prosecution
has to establish by evidence, whether direct or circumstantial, that there was plan or
meeting of minds of all the accused persons to commit the offence for which they are
charged with the aid of Section 34, be it pre-arranged or on the spur of the moment; but it
must necessarily be before the commission of the crime. The true concept of the section
is that if two or more persons intentionally do an act jointly, the position in law is just the
same as if each of them has done it individually by himself. As observed in Ashok Kumar
v. State of Punjab [1977(1) SCC 746] the existence of a common intention amongst the
participants in a crime is the essential element for application of this section. It is not
necessary that the acts of the several persons charged with commission of an offence
jointly must be the same or identically similar. The acts may be different in character, but
must have been actuated by one and the same common intention in order to attract the
provision. AIR 1977 SC 109

13
. The section does not say "the common intentions of all", nor does it say "an intention
common to all". Under the provisions of Section 34 the essence of the liability is to be
found in the existence of a common intention animating the accused leading to the doing
of a criminal act in furtherance of such intention. As a result of the application of
principles enunciated in Section 34, when an accused is convicted under Section 302 read
with Section 34, in law it means that the accused is liable for the act which caused death
of the deceased in the same manner as if it was done by him alone. The provision is
intended to meet a case in which it may be difficult to distinguish between acts of
individual members of a party who act in furtherance of the common intention of all or to
prove exactly what part was taken by each of them. As was observed in Chinta Pulla
Reddy v. State of A.P. [1993 Supp (3) SCC 134]. Section 34 is applicable even if no
injury has been caused by the particular accused himself. For applying Section 34 it is not
necessary to show some overt act on the part of the accused. 1993 AIR SCW 1843

14

. The above position was highlighted in Girija Shankar v. State of U.P. [2004 (3) SCC
793]. 2004 AIR SCW 810

15. When the factual background is considered in the light of the principles highlighted
above, the inevitable conclusion is that the appellants have been rightly convicted in
terms of Section 302 read with Section 34, IPC.
16. The appeal is without merit and is dismissed.
Appeal dismissed.
@page-SC685
AIR 2008 SUPREME COURT 685 "Laxman Prasad v. Prodigy Electronics Ltd."
(From : Delhi)
Coram : 2 C. K. THAKKER AND ALTAMAS KABIR, JJ.
Civil Appeal No. 5751 of 2007 (arising out of SLP (C) No. 12405 of 2006), D/- 10 -12
-2007.
Laxman Prasad v. Prodigy Electronics Ltd. and Anr.
(A) Civil P.C. (5 of 1908), S.20 - CIVIL COURT - Territorial jurisdiction - Purpose that
S. - 20 intends to achieve.
Section 20 has been designed to secure that justice might be brought as near as possible
to every man's hearthstone and that the defendant should not be put to the trouble and
expense of travelling long distances in order to defend himself. (Para 21)
(B) Civil P.C. (5 of 1908), S.20 - CIVIL COURT - CONTRACT - PLEA - Territorial
jurisdiction - Cause of action - Suit for damages for breach of confidentiality clause in
service contract - Service contract entered into outside India - Breach of confidentiality
clause taking place at place 'D' in India - Court of place 'D' would have jurisdiction to try
suit - Plea that Court at place where agreement was entered or place where defendant
resides only had jurisdiction - Not tenable. (Paras 22)
(C) Civil P.C. (5 of 1908), S.20 - CIVIL COURT - CONTRACT - Territorial jurisdiction -
Cause of action - Different from law that would govern - Service contract with
confidentiality clause - Contract stipulating that Hong Kong Law would apply - Does not
mean that only Courts in Hong Kong would have jurisdiction - Breach of confidentiality
clause taking place in India - Indian Court would have jurisdiction as part of cause of
action arose in India - Law applicable would be as stipulated in contract. (Paras 15, 31)
(D) Civil P.C. (5 of 1908), S.35 - Constitution of India, Art.133 - COSTS - APPEAL -
APPELLATE COURT - Costs - Imposition of costs is in discretion of Court - When
Court, in light of facts have imposed costs - Appellate Court would not interfere. (Para
32)
Cases Referred : Chronological Paras
(2005)5 SCC 465 (Disting.) 29
1993 AIR SCW 131 : AIR 1993 SC 998 (Disting.) 28
(1990) 3 SCC 481 (Disting.) 24, 26
AIR 1989 SC 1239 (Ref.) 17
(1873) 8 CP 107 : 42 LJ CP 98 16
Manoj Swarup, Ajay Kumar and Arun Kumar Beriwal, for Appellant; Nikhil Nayyar,
Ankit Singhal and TVSR Sreyaj, for Respondents.
Judgement
1. C. K. THAKKER, J. - :- Leave granted.
2. The present appeal is directed against the judgment and order passed by the High Court
of Delhi on April 26, 2006 in I.A. No. 9562 of 2005 in Civil Suit (OS) No. 819 of 2005.
By the said order, the High Court dismissed an application filed by the appellant herein
under Order VII, Rules 10 and 11 of the Code of Civil Procedure, 1908 (hereafter
referred to as 'the Code').
3. Shortly stated the facts are that 'Prodigy Electronics Ltd.'-plaintiff (respondent No.1
herein) ('the Company' for short) was formed and incorporated under the laws of Hong
Kong and is engaged in the business of trading electronic goods under the name and style
'Prodigy Electronics', Hong Kong. The main area of business of the Company is Printed
Circuit Board (PCB). The business carried on by the Company involves keen
understanding of the requirements of the customers in order that the products may be
manufactured to the specific needs of the customers and they may be made available at
competitive prices. The Company is, therefore, required to take care of the consumer-
complaints, if any. It also involves a reach into the market identifying the potential
consumers of the products which involves substantial investment of time, effort and
finance. According to the Company, it has developed solid reputation in India under the
trade name and trade mark 'Prodigy Electronics' in the field of electronics generally and
PCBs particularly.
4. According to the plaintiff-Company, on July 22, 2002, the defendant (appellant herein)
joined Prodigy Electronics in India as a representative for marketing PCB products of the
Company in India. An employment contract was entered into on October 2, 2003 between
the defendant-employee and the plaintiff-Company. Under the said contract, the
defendant was given full-time employment in the Company at Hong Kong in the capacity
of 'International Business Development Manager'. He was given job
@page-SC686
profile of conducting all business of the Company in India. Subsequently, at the request
of the defendant who put forward personal reasons, he was relocated to India and a new
employment agreement dated September 13, 2004 was signed by the parties. It was
agreed that the job location of the appellant would be India. The defendant's tenure in
India started from October 1, 2004. The Company was to bear all expenditure, including
travel-expenses of the defendant. According to the Company, however, after relocation to
India in October, 2004, the defendant tendered his resignation by e-mail on the ground of
personal problems. It was also stated that he would decide his next course of action later
on. Though the Company gave assurance to the defendant to support in his personal
problems, the defendant did not withdraw the resignation and thus his employment came
to be terminated on December 20, 2004. According to the Company, the defendant sent
another e-mail on December 20, 2004 giving assurance to the Company that though he
would continue to be involved in marketing of PCB products, he would be associating
himself with manufacturers other than the customers and suppliers of the Company.
5. It is the allegation of the Company that the defendant contacted potential customers of
the Company and informed them that he was representing 'Prodigy'. He also submitted
quotes for PCB products. It was also the case of the Company that the defendant
participated in the Trade Fair in Delhi (Componex/Electronic India, 2005) which was
held between February 1, 2005 to February 4, 2005 at Pragati Maidan, New Delhi. In the
said Trade Fair, the defendant used the goodwill and passed on the trade name of the
plaintiff-Company. In the course of inquiries about the data generated about PCB
customers, the organizers of the Trade Fair informed the Company that Multi Circuit
Board (CHINA) Ltd., Hong Kong had participated in the fair and information could be
obtained from them. It was averred that the Company was shocked to receive the said
information since Multi Circuit Board (CHINA) Ltd. was the manufacturer from whom
the Company used to source its products for its Indian customers. The further inquiry by
the Company revealed that the said Multi Circuit Board (CHINA) Ltd. had a
representative in India and he was none else but the defendant who operated under the
name and style of "Prodigy Circuit Boards". On being contacted, Multi Circuit Board
(CHINA) Ltd. also confirmed that it had executed a contract with the defendant. It also
came to the notice of the Company that the defendant had registered a deceptively similar
domain name 'www.prodigycircuits.com' as far back as on October 5, 2004 while he was
still in the employment of the Company. The Company was thus convinced that the
defendant had not resigned on account of personal reasons or family problems but he
wanted to misuse confidential information which he had received from the Company and
he wanted to take undue advantage in spite of the agreement entered into with the
Company. The Company also discovered that the defendant had incorporated a Company
under the name and style of 'Canton Treasure Corporation Ltd.' on July 16, 2004 when he
was stationed in Hong Kong and was still serving with the Company. Thus, obvious
breach of employment contract was committed by the appellant.
6. In view of the above facts and breach of contract by the defendant, the plaintiff-
Company on May 28, 2005, filed a suit being Civil Suit (OS) No. 819 of 2005 in the
High Court of Delhi at New Delhi (Original Jurisdiction) for permanent and mandatory
injunction against the defendant as also for damages by ordering rendition of accounts.
Along with the plaint, the Company filed an application under Order XXXIX, Rules 1
and 2 read with Section 151 of the Code for interim injunction restraining the defendant
from using the name 'Prodigy', 'Prodigy Circuit' or any other identical or deceptively
similar name or from passing off any such identical or deceptively similar trade mark or
trade name.
7. Notice was issued to defendant. He filed his written statement on November 10, 2005.
The defendant also filed an application under Order VII, Rules 10 and 11 of the Code
praying for rejection/return of plaint for presentation to proper Court. It was contended by
the defendant that the plaint disclosed no cause of action and was liable to be rejected. It
was further stated that no requisite Court fee had been paid within the time granted by the
Court and on that ground also, the plaint deserved to be rejected. It was also asserted that
there was an agreement between the plaintiff-Company and the defendant by which
@page-SC687
exclusive jurisdiction was granted to Courts in Hong Kong and jurisdiction of all other
Courts had been ousted and on that ground also Delhi Court had no jurisdiction in the
matter.
8. The High Court, as observed earlier, considered the application of the defendant and by
the impugned order, dismissed it holding that the agreement did not take away
jurisdiction of the Court as contended by the defendant and the application had been filed
only with a view to delay the progress of the suit which was liable to be dismissed and it
was accordingly dismissed with costs of Rs.4,000/-.
9. The appellant-defendant has challenged the said order by filing the present appeal. On
August 7, 2006, notice was issued by this Court and in the meantime further proceedings
in the suit were stayed.
10. We have heard learned counsel for the parties.
11. The learned counsel for the appellant contended that the High Court was wholly
wrong in holding that Courts in India could entertain a Civil Suit and the application filed
by the defendant-appellant was liable to be rejected. According to the learned counsel, the
agreement entered into between the parties made it expressly clear that the law
applicable, in case of dispute between the parties would be law of Hong Kong Special
Administrative Region and, hence, Indian Courts have no jurisdiction to entertain, deal
with and decide such question. It was also submitted by the learned counsel that in the
light of the agreement between the parties, only remedy available to the plaintiff-
Company was to take appropriate proceedings in accordance with law in a competent
Court in Hong Kong and no Indian Court could have jurisdiction inasmuch as jurisdiction
of all Courts in India is barred by necessary implication. The counsel also contended that
the High Court committed an error in holding that Delhi High Court had jurisdiction as
the defendant was residing in Delhi. In the plaint itself, the plaintiff gave the address of
the defendant of Ghaziabad which is not in Delhi but in Uttar Pradesh (U.P.). The counsel
also made grievance that the High Court was not right in observing that the defendant
wanted to delay the proceedings and was not justified in imposing costs of Rs.4,000/-. It
was, therefore, submitted that the appeal deserves to be allowed by setting aside the order
passed by the High Court.
12. The learned counsel for the respondent-Company, on the other hand, supported the
order passed by the High Court. He submitted that the only thing which was relevant in
the agreement was as to applicability of laws. As per settled legal position, a suit could be
instituted in Delhi as part of cause of action had arisen within the territorial jurisdiction of
that Court. The High Court was right in observing that applicability of law had nothing to
do with situs of a suit and since the defendant had used the trade mark/trade name of the
plaintiff in Delhi in Trade Fair, it was open to the plaintiff Company to institute a suit in
Delhi. It was submitted that it is really surprising that though Hong Kong based Company
institutes a suit in Delhi where the defendant had used the trade mark/trade name, where
he resides and thus it is much more convenient to him to defend the suit, yet he objects to
the proceedings which clearly goes to show that the only intention on the part of the
defendant is to delay the proceedings. The High Court was, therefore, right in dismissing
the application and in ordering payment of costs by him. It was, therefore, submitted that
the appeal deserves to be dismissed.
13. Having heard the learned counsel for the parties, in our opinion, no case has been
made out by the appellant from which it can be said that Delhi Court had no jurisdiction.
Both the learned counsel referred to the agreement dated September 13, 2004 entered into
between the parties. Clause 10 of the agreement relates to "Resignation and Termination
of Service". In accordance with the said clause, the appellant herein left the plaintiff-
Company. Clause 10 stipulates that in the event of resignation or termination for any
reason, the employee would not engage himself in a similar or competitive business for a
period of two years, nor he would contact or solicit any customer or supplier with whom
the employer conducted business during the employment. Clause 14 provides for
'Conflict of Interest'. Clause 15 deals with 'Confidentiality'. It recites that upon accepting
employment with Prodigy, the defendant would maintain confidentiality which would
mean that he would not disclose any 'Prodigy confidential information' either during or
after his employment to anyone outside the Company, nor would use it for personal
benefit. Clause 18 is material
@page-SC688
for the purpose of controversy and may be reproduced - :
18. The terms and conditions as stipulated above shall be interpreted in accordance to the
laws of the Hong Kong Special Administrative Region.
(Emphasis supplied)
14. It is this Clause (Clause 18), which requires interpretation. According to the appellant,
since the terms and conditions in the agreement have to be interpreted in accordance with
the laws of Hong Kong, no Court in any country other than a Court in Hong Kong shall
have jurisdiction to entertain a suit, petition, application or any other proceeding. The
submission of the respondent-Company, on the other hand, is that what is agreed upon is
not territorial jurisdiction of a Court but applicability of laws. Clause 18 deals with the
second eventuality and declares that terms and conditions of the agreement would be
interpreted in accordance with the laws of Hong Kong.
15. We find considerable force in the submission of the learned counsel for the
respondent Company. In our view, 'cause of action' and 'applicability of law' are two
distinct, different and independent things and one cannot be confused with the other. The
expression 'cause of action' has not been defined in the Code. It is however settled law
that every suit presupposes the existence of a cause of action. If there is no cause of
action, the plaint has to be rejected [Rule 11(a) of Order VII). Stated simply, 'cause of
action' means a right to sue. It consists of material facts which are imperative for the
plaintiff to allege and prove to succeed in the suit. The classic definition of the expression
('cause of action') is found in the observations of Lord Brett in Cooke v. Gill, (1873) 8 CP
107 : 42 LJ CP 98.
16. His Lordship stated;
"Cause of action means every fact which it would be necessary for the plaintiff to prove,
if traversed, in order to support his right to the judgment of the court".
17
. In A.B.C. Laminart Pvt. Ltd. v. A.P. Agencies (1989) 2 SCC 163, this Court said; AIR
1989 SC 1239, (Para 27)

"A cause of action means every fact, which, if traversed, it would be necessary for the
plaintiff to prove in order to support his right to a judgment of the Court. In other words,
it is a bundle of facts which taken with the law applicable to them gives the plaintiff a
right to relief against the defendant. It must include some act done by the defendant since
in the absence of such an act no cause of action can possibly accrue. It is not limited to
the actual infringement of the right sued on but includes all the material facts on which it
is founded. It does not comprise evidence necessary to prove such facts, but every fact
necessary for the plaintiff to prove to enable him to obtain a decree. Everything which if
not proved would give the defendant a right to immediate judgment must be part of the
cause of action. But it has no relation whatever to the defence which may be set up by the
defendant nor does it depend upon the character of the relief prayed for by the plaintiff".
(Emphasis supplied)
18. Now, Sections 16 to 20 of the Code deal with territorial jurisdiction of a Court (place
of suing). Whereas Sections 16 to 18 relate to immovable property, suits for
compensation for wrongs to persons or movables have been dealt with under Section 19.
Section 20 of the Code is a residuary provision and covers all cases not falling under
Sections 16 to 19.
19. The relevant part of Section 20 reads thus;
20. Other suits to be instituted where defendants reside or cause of action arises.- Subject
to the limitations aforesaid, every suit shall be instituted in a Court within the local limits
of whose jurisdiction-
(a) the defendant, or each of the defendants where there are more than one, at the time of
the commencement of the suit, actually and voluntarily resides, or carries on business, or
personally works for gain; or
(b) any of the defendants, where there are more than one, at the time of the
commencement of the suit, actually and voluntarily resides, or carries on business, or
personally works for gain, provided that in such case either the leave of the Court is
given, or the defendants who do not reside, or carry on business, or personally work for
gain, as aforesaid, acquiesce in such institution; or
(c) the cause of action, wholly or in part, arises.
(Emphasis supplied)
20. Bare reading of Clause (c) leaves no room for doubt that a suit would lie in a court
within the local limits of whose jurisdiction the cause of action has arisen, wholly or
partly.
@page-SC689
21. Section 20 has been designed to secure that justice might be brought as near as
possible to every man's hearthstone and that the defendant should not be put to the
trouble and expense of travelling long distances in order to defend himself.
22. According to the plaintiff-Company, a suit instituted on the Original Side of the High
Court of Delhi is maintainable since a part of cause of action had accrued within the
territorial jurisdiction of Delhi Court (breach of agreement by defendant). The argument
of the defendant that the agreement was executed in Hong Kong and hence suit could
have been instituted only in that country is, in our opinion, not well founded. It is no
doubt true that the suit could have been instituted in Hong Kong as well. That, however,
does not take away the jurisdiction of Delhi Court where a part of cause of action has
arisen. In the plaint, it was specifically alleged by the plaintiff Company that the
defendant committed breach of terms and conditions of agreement during the Trade Fair
in February, 2005 held in Pragati Maidan, Delhi. It was, therefore, open to the plaintiff
Company to institute a suit in a competent Court within the jurisdiction of Delhi and that
is how the suit is filed in the High Court on its Original Side. In our considered opinion,
therefore, the contention of the appellant-defendant that the agreement was executed in a
foreign country or the defendant was a resident of Ghaziabad (Uttar Pradesh) cannot take
away, exclude or oust the jurisdiction of Delhi Court in view of the averment made in the
plaint that a part of cause of action had arisen within the local limits of Delhi.
23. It was submitted by the learned counsel for the appellant that once there is an
agreement as to choice of Court or forum, the parties are bound by it. For the said
proposition, our attention has been invited to several decisions rendered by this Court. We
do not intend to burden our judgment on that point as the law is well settled and the
learned counsel for the respondent-Company has not disputed the proposition. What was
contended was that Clause 18 does not take away the jurisdiction of a competent Court
and the agreement did not exclude territorial jurisdiction of any Court.
24. Learned counsel for the appellant relied on a decision of this Court in British India
Steam Navigation Co. Ltd. v. Shanmughavilas Cashew Industries and Ors., (1990) 3 SCC
481. In that case, the plaintiff purchased from the defendant-Company raw cashew nuts
which were shipped in a vessel chartered by the Company incorporated in England.
Clause 3 of the Bill of Lading dealt with jurisdiction of the Court. The said clause read as
under - :
3. JURISDICTION - : The contract evidenced by this bill of lading shall be governed by
English law and disputes determined in England or, at the option of the Carrier, at the
port of destination according to English law to the exclusion of the jurisdiction of the
Courts of any other country.
25. Though the above clause made it clear that the dispute should be determined in
England, this Court held that the objection as to territorial jurisdiction had been waived
by the defendant. So far as the law is concerned, it was held that proper law to govern the
contract was English law.
26. The learned counsel for the appellant submitted that the ratio laid down in British
India Steam Navigation Co. applies to the case on hand and the High Court of Delhi
committed an error of law in not upholding the objection of the defendant that Indian
Court had no jurisdiction to deal with the matter.
27. We are unable to agree. Clause 3, as extracted hereinabove, clearly provided that the
contract would be governed by English law. The High Court was, therefore, right in
observing that the case is not relevant so far as the question raised in the present matter.
28

. The counsel also referred to National Thermal Power Corporation v. Singer Company
and Ors., (1992) 3 SCC 551. The parties in that case by an agreement had chosen the
jurisdiction of one Court to the exclusion of the other. Likewise, they also agreed as to the
applicability of law. In the light of the fact situation, the Court held that the parties are
bound by such Agreement and it has to approach a Court in consonance with the
agreement. This judgment also does not help the appellant in the instant case. 1993
AIR SCW 131

29. Our attention was also invited to Technip S.A. v. S.M.S. Holding (P) Ltd. and Ors.,
(2005) 5 SCC 465. Even that case also does not help the appellant. What was held there
was as to the law applicable to the dispute and not the territorial jurisdiction of the Court.
On the contrary, para 23 of the
@page-SC690
said decision goes to show that territorial jurisdiction of the Court and applicability of
law are two different things and even if a matter is decided in the country other than the
country where the agreement has been executed, the law which would apply would be the
law agreed by the parties.
30. The Court stated;
"23. The relationship of Technip to Coflexip whether one of control or not is really a
question of their status. The applicable law would therefore be the law of their domicil,
namely, French law. Having determined their status according to French Law, the next
question as to their obligation under the Indian Law vis-a-vis SEAMEC would have to be
governed exclusively by Indian law (in this case the Act and the Regulations). SATs error
lay in not differentiating between the two issues of status and the obligation by reason of
the status and in seeking to cover both under a single system of law". (Emphasis
supplied)
31. In the case on hand, we have referred to the relevant clauses of the agreement. Clause
18 provides for applicability of law and it specifically declares that the terms and
conditions of the agreement shall be interpreted in accordance with 'the laws of Hong
Kong Special Administrative Region'. That, in our judgment, does not mean that a suit
can be instituted only in Hong Kong and not in any other country. Territorial jurisdiction
of a Court, when the plaintiff intends to invoke jurisdiction of any Court in India, has to
be ascertained on the basis of the principles laid down in the Code of Civil Procedure.
Since a part of 'cause of action' has arisen within the local limits of Delhi as averred in
the plaint by the plaintiff Company, the question has to be considered on the basis of such
averment. Since it is alleged that the appellant-defendant had committed breach of
agreement by using trade mark/trade name in Trade Fair, 2005 in Delhi, a part of cause of
action has arisen in Delhi. The plaintiff-Company, in the circumstances, could have filed
a suit in Delhi. So far as applicability of law is concerned, obviously as and when the suit
will come up for hearing, the Court will interpret the clause and take an appropriate
decision in accordance with law. It has, however, nothing to do with the local limits of the
jurisdiction of the Court. The High Court, in our opinion, was right in rejecting the
application and in overruling preliminary objection. Since prima facie the plaint disclosed
a cause of action as also territorial jurisdiction of the Court, the High Court rightly
rejected both the contentions and no error was committed by it in not rejecting plaint, nor
returning it for presentation to proper Court. 'Applicability of Hong Kong Law', 'entering
into an agreement in Hong Kong' or 'defendant residing in Ghaziabad (Uttar Pradesh)' or
any of them does not take away the jurisdiction of Delhi Court since a 'cause of action' at
least in part, can be said to have arisen in Delhi. We, therefore, see no substance in the
contention of the defendant-appellant.
32. So far as imposition of costs is concerned, normally it is in the discretion of the Court.
When the Court, in the light of the facts before it, satisfied that the defendant wanted to
delay the proceedings and ordered him to pay costs of Rs.4,000/-, it would not be
appropriate to interfere with that part of the order.
33. For the foregoing reasons, the appeal deserves to be dismissed and is accordingly
dismissed. However, in the facts and circumstance of the case, there shall be no order as
to costs.
Appeal dismissed.
AIR 2008 SUPREME COURT 690 "State of Rajasthan v. Ganeshi Lal"
(From : Rajasthan)*
Coram : 2 Dr. A. PASAYAT AND P. SATHASIVAM, JJ.
Civil Appeal No. 3021 of 2006, D/- 10 -12 -2007.
State of Rajasthan v. Ganeshi Lal.
(A) Constitution of India, Art.141 - PRECEDENT - Precedent - Decision is precedent on
its own facts - What is binding in a decision is the principle on which it is decided -
Reliance on a decision without looking into factual background of case before it is clearly
impermissible - Circumstantial flexibility, one additional or different fact may make a
world of difference between conclusions in two cases. (Paras 11, 14)
(B) Industrial Disputes Act (14 of 1947), S.2(s) - INDUSTRIAL DISPUTE - DAILY-
WAGE WORKERS - Workman - Daily wager, peon attached to Public Prosecutor - Not
@page-SC691
workman - As Law Department cannot by any stretch of imagination be considered as
industry.
D. B. C. Spl. A. No. 391 of 2004, D/- 21-5-2004, Reversed. (Paras 16, 17)
Cases Referred : Chronological Paras
1996 AIR SCW 4020 11
(1972) 2 WLR 537 13
(1971) 1 WLR 1062 13
(1970) 2 All ER 294 13
AIR 1968 SC 647 (Rel. on) 11
(1951) AC 737 12
(1901) AC 495 (HL) 11
Manish Kumar, Ansar Ahmad Chaudhary, for Appellant; Nikilesh Ramachandran, for
Respondent.
* DB Civil Special Appeal No. 391 of 2004, D/- 21-5-2004 (Raj.).
Judgement
1. Dr. ARIJIT PASAYAT, J. :- Challenge in this appeal is to the order passed by a
Division Bench of the Rajasthan High Court, Jodhpur, upholding the view taken by the
learned Single Judge. Before the High Court challenge was to the award of the Labour
Court, Bikaner.
2. Background facts are almost undisputed and are as follows :
Respondent was working as a peon attached to the Public Prosecutor. He was getting an
amount of Rs.1,000/- p.m. as a temporary employee on a contract basis. He was engaged
under the Joint Legal Remembrancer and Director, Litigation, Law Department, Jaipur.
His services were terminated by notice dated 5.12.1998 w.e.f. 7.12.1998, and according
to him, it was in violation of the provisions of Section 25-G of the Industrial Disputes
Act, 1947 (in short the 'Act'). Therefore, a dispute was raised. A reference was made to
the Labour Court, vide Notification No. F 1(1)(1145) L.F./2000 dated 31st July, 2000,
under Section 10 of the Act. The reference was of the following dispute :
"Whether the termination from service on 7.12.1998 of the applicant Shri Ganeshilal son
of Shri Noratmal Barber by the non-applicant (1) Additional Public Prosecutor, Rajgarh
District Churu (2) Joint Law Adviser and Director Litigation, Law Department, Rajasthan
Churu is proper and valid? If not then to what relief the applicant is entitled for?"
3. The claim was resisted by the present appellant on the ground that the Law department
is not an industry.
4. On a reference to the Labour Court the Presiding Officer, Labour Court, held that Law
department was an industry in view of what has been stated by this Court in relation to
various departments, hotel, school, public works department, irrigation department. This
view has been accepted by learned Single Judge who held that there was no scope for
interference under Article 226 of the Constitution of India, 1950 (in short 'the
Constitution').
5. The Division Bench after referring to Section 2(s) of the Act held that the view of the
Labour Court was correct.
6. Learned counsel for the appellant submitted that by no stretch of imagination the Law
department can be considered to be an industry. Learned counsel for the respondent on
the other hand submitted that the Labour Court and the High Court were justified in their
views.
7. Section 2(s) of the Act defines "workman" as follows :
"any person (including an apprentice) employed in any industry to do any manual,
unskilled, skilled, technical, operational, clerical or supervisory work for hire or reward,
whether the terms of employment be express or implied, and for the purposes of any
proceeding under this Act in relation to an Industrial Dispute, includes any such person
who has been dismissed, discharged or retrenched in connection with, or as a
consequence of, that dispute, or whose dismissal, discharge or retrenchment has led to
that dispute."
8. For bringing in application of Section 2(s) of the Act, the workman must be employed
in an industry. The Law department can, by no stretch of imagination, be considered as an
industry.
9. Learned counsel for the appellant submitted that whether any Government department
can be treated as industry is under consideration of a larger Bench of this Court.
10. The Labour Court and the High Court have not even indicated as to how the Law
department is an industry. Merely stating that in some cases Irrigation Department, Public
Works Department have been held to be covered by the expression "industry" in some
decisions.
11

. Reliance on the decision without looking into the factual background of the case before
it is clearly impermissible. A decision is a precedent on its own facts. Each case 1996
AIR SCW 4020

@page-SC692
presents its own features. It is not everything said by a Judge while giving a judgment
that constitutes a precedent. The only thing in a Judge's decision binding a party is the
principle upon which the case is decided and for this reason it is important to analyse a
decision and isolate from it the ratio decidendi. According to the well-settled theory of
precedents, every decision contains three basic postulates (i) findings of material facts,
direct and inferential. An inferential finding of facts is the inference which the Judge
draws from the direct, or perceptible facts; (ii) statements of the principles of law
applicable to the legal problems disclosed by the facts; and (iii) judgment based on the
combined effect of the above. A decision is an authority for what it actually decides.
What is of the essence in a decision is its ratio and not every observation found therein
nor what logically flows from the various observations made in the judgment. The
enunciation of the reason or principle on which a question before a Court has been
decided is alone binding as a precedent. (See - : State of Orissa v. Sudhansu Sekhar Misra
and Ors. (AIR 1968 SC 647) and Union of India and Ors. v. Dhanwanti Devi and Ors.
(1996 (6) SCC 44)). A case is a precedent and binding for what it explicitly decides and
no more. The words used by Judges in their judgments are not to be read as if they are
words in Act of Parliament. In Quinn v. Leathem (1901) AC 495 (HL), Earl of Halsbury
LC observed that every judgment must be read as applicable to the particular facts proved
or assumed to be proved, since the generality of the expressions which are found there are
not intended to be exposition of the whole law but governed and qualified by the
particular facts of the case in which such expressions are found and a case is only an
authority for what it actually decides.
12. Courts should not place reliance on decisions without discussing as to how the factual
situation fits in with the fact situation of the decision on which reliance is placed.
Observations of Courts are neither to be read as Euclid's theorems nor as provisions of
the statute and that too taken out of their context. These observations must be read in the
context in which they appear to have been stated. Judgments of Courts are not to be
construed as statutes. To interpret words, phrases and provisions of a statute, it may
become necessary for Judges to embark into lengthy discussions but the discussion is
meant to explain and not to define. Judges interpret statutes, they do not interpret
judgments. They interpret words of statutes; their words are not to be interpreted as
statutes. In London Graving Dock Co. Ltd. v. Horton (1951 AC 737 at p.761), Lord Mac
Dermot observed:
"The matter cannot, of course, be settled merely by treating the ipsissima vertra of Willes,
J as though they were part of an Act of Parliament and applying the rules of interpretation
appropriate thereto. This is not to detract from the great weight to be given to the
language actually used by that most distinguished Judge."
13. In Home Office v. Dorset Yacht Co. (1970 (2) All ER 294) Lord Reid said, "Lord
Atkin's speech.....is not to be treated as if it was a statute definition. It will require
qualification in new circumstances." Megarry, J in (1971) 1 WLR 1062 observed: "One
must not, of course, construe even a reserved judgment of Russell L.J. as if it were an Act
of Parliament." And, in Herrington v. British Railways Board (1972 (2) WLR 537) Lord
Morris said :
"There is always peril in treating the words of a speech or judgment as though they are
words in a legislative enactment, and it is to be remembered that judicial utterances made
in the setting of the facts of a particular case."
14. Circumstantial flexibility, one additional or different fact may make a world of
difference between conclusions in two cases. Disposal of cases by blindly placing
reliance on a decision is not proper.
15. The following words of Lord Denning in the matter of applying precedents have
become locus classicus :
"Each case depends on its own facts and a close similarity between one case and another
is not enough because even a single significant detail may alter the entire aspect, in
deciding such cases, one should avoid the temptation to decide cases (as said by
Cordozo) by matching the colour of one case against the colour of another. To decide
therefore, on which side of the line a case falls, the broad resemblance to another case is
not at all decisive."
*** *** ***
"Precedent should be followed only so far as it marks the path of justice, but you must cut
the dead wood and trim off the side
@page-SC693
branches else you will find yourself lost in thickets and branches. My plea is to keep the
path to justice clear of obstructions which could impede it."
16. As noted above, the accepted concept of an industry cannot be applied to the Law
department of the Government.
17. That being so, the view expressed by the Labour Court and the High Court is
indefensible. However, it appears that the respondent has been reinstated to the post he
was holding at the time of termination. In view of this fact, even though we have held
that the orders passed are clearly unsustainable. We leave it to the appellant to consider
whether the respondent can be continued, in view of the fact that he worked for some
years.
18. The appeal is allowed to the aforesaid extent without any order as to costs.
Order accordingly.
AIR 2008 SUPREME COURT 693 "U. P. Power Corpn. Ltd v. Sant Steels and Alloys (P)
Ltd."
(From : Allahabad)*
Coram : 2 A. K. MATHUR AND MARKANDEY KATJU, JJ.
Civil Appeal Nos. 1215-1216 of 2001, D/- 10 -12 -2007
U. P. Power Corpn. Ltd. and Anr. v. Sant Steels and Alloys (P) Ltd. and Ors.
Electricity (Supply) Act (54 of 1948), S.49 - ELECTRICITY - PROMISSORY
ESTOPPEL - PRINCIPLES - LEGISLATURE - Tariff - Development rebate - Grant of,
to new industrial Units in hill areas - Passing of notification by delegated authorities in
exercise of delegated authority - Revocation of - Has no flavour of statute - Not shown to
be issued in public interest - Principle of promissory estoppel would be attracted - Simply
because there was theft of energy - Cannot be ground to claim that revocation was in
public interest - Said benefits however, not being recognised by 1999 Act - Would not be
available to claimants from date of enactment of 1999 Act.
Constitution of India, Art.245.
Evidence Act (1 of 1872), S.115.
U.P. Electricity Reforms Regulation Act (24 of 1999), S.1.
Notification issued under S. 499 for giving the benefit of exemption for the new
industrial units in the hill areas was in the nature of delegated legislation and not an Act
framed by the State Legislature. Therefore, a distinction has to be made between the
delegated legislation and the primary legislation. So far as the primary legislation is
concerned, if the Act is passed by State Legislature and denies the benefit by the primary
legislation then no estoppel can be applied against that Act but so far as the case of
delegated legislation is concerned, where delegated authorities passes certain notification
in exercise of his delegated authority there is no contemplation mentioned in the Act itself
that it is capable of being revoked at any time. Then such acts cannot be treated at par
with the primary Act passed by the State Legislatutre. The State is fully competent to pass
an Act prospectively as well as retrospectively but restrospectivity to the extent of
aforesaid nature cannot stand. Therefore, this distinction has to be borne in mind. In the
instant case, the U. P. Electricity Reforms Act, 1999 came into force with effect from
2000. Therefore, if such benefit has not been extended then a different stand will follow
but so far as the delegated legislation is concerned, this kind of revocation cannot be
sustained. It is highly against the public morality that the incumbent who have felt
persuaded on account of the representation made by the State Government that they will
be given certain benefits and they acted on that representation, it does not behove on the
part of the appellant - Corporation to withdraw the said benefit before expiry of the
stipulated period by issuing the notification revoking the same which the respondents
were legitimately entitled to avail. The appellant Corporation which made a
representation and allowed the other party to act upon such representation could not resile
and leave the citizens in a lurch. In such a situation the principle of promissory estoppel
which has been evolved by the Courts which is based on public morality cannot permit
the State to act in such an arbitrary fashion. (Para 18)
This is not case in which serious public repercussion was involved. Simply because there
was theft of energy cannot be ground to hold that the revocation of such concession can
be said to be in public interest. Since the benefit was given to these units in the hill areas,
there should have been
@page-SC694
overwhelming evidence to show some mala fide on the part of these consumers which
have persuaded the Corporation to revoke it. If there was no misuse of the energy by
these units in the hill areas to whom the concession had been granted then in that case it
cannot be taken that there was really public interest involved which persuaded the
Corporation to revoke the same. No person can be permitted to misuse the concession or
benefit and invoke promissory estoppel. Promissory estoppel is not one sided affair, it is
rather two sided affair. If one party abuses the concession then it is always open to the
other party to revoke such concession but if one party avails the benefit and is acting on
the same representation made by the other party then the other party who has granted the
said benefit cannot revoke the same under the garb of public interest. (Para 18))
Whenever the State has made a representation to the public and the public has acted on
that representation and suffered economically or otherwise, then in that case the State
should be estopped from withdrawing such benefit to the detriment of the such people
except in public interest or against the Statute. So far as the public interest as involved in
the present case is concerned, there was no overwhelming evidence to revoke the benefit
granted to the industrial units in the hill areas. So far as the Statute is concerned, the
notification was issued under S. 49 and the same was revoked under S. 49 though there
was no such provision contained in S. 49 that it will be open to the Corporation to revoke
the same but could be possible by invoking the principle of General Clauses Act. But in
such delegated legislation such withdrawal could only be permitted if larger public
interest is involved or if the Act is passed by legislature. (Para 18)
Since such benefits have not been recognised by the Act of 1999, therefore, upto the date
of coming into force of the Act of 1999, all the benefits which were being given to the
respondent-entrepreneurs shall be protected by invoking the principle of promissory
estoppel but after coming into force of the Act of 1999, which is a primary legislation
enacted by the State Legislature the benefits from the date of the Act has come into force,
cannot be made available to the respondents.(Paras 19, 21)
Cases Referred : Chronological Paras
2006 AIR SCW 1500 (Ref) 16
2006 AIR SCW 5272 (Ref) 13
2004 AIR SCW 3703 : AIR 2004 SC 4559 (Ref) 15
1999 AIR SCW 2369 : AIR 1999 SC 2302 (Ref) 12
1998 AIR SCW 1866 : AIR 1998 SC 591 (Ref) 11, 14, 15, 18
1997 AIR SCW 3839 : AIR 1997 SC 3910 : 1997 All LJ 2202 (Rel. on) 2, 5, 7, 8, 14
(1997) 3 SCC 398 (Ref) 10, 14
1995 AIR SCW 680 : AIR 1995 SC 874 (Ref) 9, 10, 14
AIR 1979 SC 621 : 1979 All LJ 368 13
AIR 1974 SC 555 : 1974 Lab IC 427 (Ref) 13
AIR 1968 SC 718 13
Dr. A. M. Singhvi and Ratnakar Dash, Sr. Advocates, Pradeep Misra, Amit Bhandari,
Daleep Dhayani, Dinesh Kumar Garg and Anuvarat Sharma, for Appellants; Shanti
Bhushan, R. F. Nariman, S. Ganesh, M. L. Bhat, Sr. Advocates, Sudhir Kumar Gupta,
Anurag Pandey, Mihir Kumar Chaudhary, M. L. Lahoty, Anurag Pandey, Paban K.
Sharma, Ms. Poonam Lahoty, Ramesh Singh, Rajeev Sharma, R. Santa-nam, Ms.
Manjula Gupta, Irshad Ahmad, R. C. Verma and Pradeep Misra, for Respondents.
* W.P. Nos. 15292 and 15293 of 1999, D/- 25-5-2000 (All.)
Judgement
A. K. MATHUR, J. :- These appeals are directed against the order dated 25.5.2000 passed
by the Division Bench of the Allahabad High Court whereby the Division Bench has
allowed the writ petitions and Clause 9(a) of the notification dated 25.1.1999 (Annexure-
8 to the writ petition) and clause 8(a) of the notification dated 18.6.1998 (Annexure -7 to
the writ petition ) were struck down. It was further directed that the writ petitioners were
entitled to get hill development rebate of 33.33% on the total amount of the bill till the
period of 5 years from the date of commencement of supply of the electricity to them and
the appellant-Corporation was directed to issue electricity bills to the writ petitioners after
allowing 33.33% hill development rebate on the total amount of bill for the remaining
unexpired period of five years. Aggrieved against this order, the present appeals were
filed by U.P. Power Corporation Ltd.(hereinafter referred to as Corporation.)
@page-SC695
2

. In order to dispose of these appeals brief facts may be detailed below. Pursuant to
industrial policy of the State of Uttar Pradesh, U.P.State Electricity Board (now U.P.
Power Corporation Limited)[hereinafter to be referred to as the "Corporation"]- the
appellant herein framed its tariffs vide notifications dated 18.1.1992 and 15.7.1994. By
these notifications 33.33% hill development rebate was allowed to the new industrial
units for a period of five years from the date of commencement of the supply of the
electricity. The above concession was initially valid till 31.3.1995. It was later on
extended up to 31.3.1997. It was alleged that all the writ petitioners established industrial
units in the hill areas after huge investments and after executing agreement with the
appellant-Corporation. But subsequently, by notifications dated 18.6.1998 and 25.1.1999
the concession which was earlier given was reduced by the appellant-Corporation from
33.33% to 17% which is arbitrary and not permissible according to principle of
promissory estoppel and in that connection reliance was placed on a decision of this
Court in Pawan Alloys and Casting Pvt. Ltd., Meerut v. U.P.State Electricity Board and
Ors. (1997) 7 SCC 251. Written statement was filed by the appellant-Corporation and the
appellant took the stand that the impugned tariffs were new structured tariff in respect of
HV-1 category of consumers and it was empowered to frame tariff under the provisions
of Section 49 of the Electricity (Supply) Act, 1948 (hereinafter to be referred to as the Act
of 1948). It was also contended that this restructuring was necessitated in order to avoid
loss to the Corporation due to theft of electricity and it was done in the public inter est.
1997 AIR SCW 3839

3. In order to appreciate the controversy involved in the matter, it will be appropriate to


refer to the relevant tariff notification issued from time to time by the appellant-
Corporation. The first in point of time is the tariff vide notification dated 18.1.1992.
Relevant provisions of clauses read as under :
"4. Rate of Charge ( Energy Charges) :
All KWH consumed in 3 month 280 paise per
KWH.
5. Extra Charge or Rebate :
(i) In case of supply given at 400 volts, the consumer shall be required to pay an extra
charge of 10 per cent on the amount calculated at the rate of charge under item (4).
(ii) If supply is given at voltage more than 11KV, rebate mentioned below will be
admissible on the amount calculated at the rate of charge under item (4).
(a) Above 11 KV upto 66 KV 5%
(b) Above 66 KV upto 132 KV 7.5% )
(c) Above 132 KV 10%.
xx xx xx
xx xx xx
8. Concessions :
In respect of connections as may be located in any of the eight hill districts in U.P. whose
names are given below but excluding those existing at a height of less than 610 mts
(2,000feet) above M.S.L. in Dehradun and National districts a development rebate of 33
1/3% on the amount of the bill as computed under items 4 and 5 above will be given to
new connections for a period of five years from the date of commencement of supply.
This rebate will also be admissible for the unexpired period of five years to those existing
connections which have not completed five years from the date of commencement of
supply. This development rebate shall not be admissible to the
Departments/Corporations/Undertaking of State/Central Government and Local Bodies."
Name of eight Hill Districts :
1. Almora district
2. Chamoli district
3. Pauri Garhwal district
4. Pithoragarh district
5. Uttar Pradesh district
6. Tehri Garhwal district
7. Uttarkashi district
8. Dehradun district.
In respect of connections as may be located in Bundelkhand region, comprising Jhansi,
Lalitpur, Hamipur, Jalaun and Banda districts a development rebate of 50% on the
amount of the bill as computed under items 4 and 5 above will be given to new Industrial
units for a period of five years from the date of commencement of supply. This rebate
will also be admissible for the unexpired period of five years to those existing Industrial
units of the above district of Bundelkhand region who have not completed five years
from the date of commencement of supply. This
@page-SC696
development rebate shall however not be allowed to the
Department/Corporations/Undertakings of the State/ Central Government and Local
Bodies. " Therefore, this concession was extended to the entrepreneurs in the hill districts
including Dehradun who established their industries at the height of 610 metres (2000
feet) above M.S.L.for a period of five years. Then on 15.7.1994 another notification was
issued. Relevant provisions of Clauses 4,5 and 8 read as under :

"4. Rate of Charge ( Energy Charges):


All KWH consumed in 3 month 280 paise per KWH.
5. Extra Charge or Rebate :

(iii) In case of supply given at 400 volts, the consumer shall be required to pay an extra
charge of 10 per cent on the amount calculated at the rate of charge under item (4).
(iv) If supply is given at voltage more than 11KV, rebates mentioned below will be
admissible on the amount calculated at the rate of charge under item (4).

(a) Above 11 KV upto 66 KV 5%


(b) Above 66 KV upto 132 KV 7.5% )
(c) Above 132 KV 10%.

8. Concessions:- (a) In respect of connections as may be located in under mentioned areas


of the hill districts in U.P., a development rebate of 33 1/3 per cent on the amount of the
bill as computed under items 4 and 5 above will be given to new connections for a period
of five years from the date of commencement of supply. This rebate will also be
admissible for the unexpired period of five years to those existing connections which
have not completed five years from the date of commencement of supply. Provided that
the above development rebate shall not be admissible to the
Departments/Corporations/Undertakings of State/Central Government and local bodies.
Description of Area of Hill Districts :
1. Almora district
2. Pithoragarh district
3. Chamoli district
4. Uttarkashi district
5. Pauri Garhwal district excluding Nagarpalika area of Kotdwara.
6. Tehri Garhwal district excluding Muni Ki Reti and Dhalwala Blocks.
7. Nainital district excluding Haldwani, Rudrapur, Gadarpur, Kashipur, Bajpur, Ram
Nagar, Jaspur, Khatima and Sitarganj Block.
8. Dehradun district excluding Doiwala, Rampur, Sahaspur and Vikas Nagar Blocks.
(b) In respect of connections as may be located in Bundelkhand region, comprising
Jhansi, Lalitpur, Hamipur, Jalaun and Banda districts a development rebate of 50% on the
amount of the bill as computed under items 4 and 5 above will be given to new Industrial
units for a period of five years from the date of commencement of supply. This rebate
will also be admissible for the unexpired period of five years to those existing Industrial
units of the above district of Bundelkhand region who have not completed five years
from the date of commencement of supply. This development rebate of 50% in
Bundelkhand region shall, however, not be allowed to the Railways and Departments/
Corporations/ Undertakings of the State/ Central Government and Local Bodies. The
development rebates under this clause shall be allowed subject to the condition that the
net amount payable after allowing these rebates would not be less than the amount of
minimum consumption guarantee under item 6 above."
Meaning thereby that the energy charges were increased from 200 paise to 280 paise and
the concession granted to the hill areas continued. Thereafter, in supersession of earlier
notifications another notification was issued in which energy charges were increased
from 280 paise to 308 paise per KW. But the concession granted earlier continued.
Relevant provision reads as under :

"4. Rate of Charge ( Energy Charges):


All KWH consumed in one month 308 paise per KWh.
5. Extra Charge or Rebate :

(i) In case of supply given at 400 volts, the consumer shall be required to pay an extra
charge of 10 per cent on the amount calculated at the rate of charge under item (4).
(ii) If supply is given at voltage more than 11KV, rebate mentioned below will be
admissible on the amount calculated at the rate of charge under item (4).

(a) Above 11 KV upto 66 KV 5%


(b) Above 66 KV upto 132 KV 7.5% )
(c) Above 132 KV 10%.

xx xx xx
8. Concessions :
The concessions mentioned hereunder
@page-SC697
shall be applicable to consumers connected upto 31.3.97.
(a) In respect of connections as may be located in undermentioned areas of the hill
districts in U.P., a development rebate of 33 1/3 % on the amount of the bill as computed
under items 4 and 5 above will be given to new connections for a period of five years
from the date of commencement of supply. This rebate will also be admissible for the
unexpired period of five years to those existing connections which have not completed
five years from the date of commencement of supply.
Provided that the above development rebate shall not be admissible to the
Departments/Corporations/Undertakings of State/Central Government and local bodies.
Description of Area of Hill Districts :
1. Almora district
2. Pithoragarh district
3. Chamoli district
4. Uttarkashi district
5. Pauri Garhwal district excluding Nagarpalika area of Kotdwara.
6. Tehri Garhwal district excluding Muni Ki Reti town area and Dhalwala village under
Narendra Nagar Block.
7. Nainital district excluding Haldwani, Rudrapur, Gadarpur, Kashipur, Bajpur, Ram
Nagar, Jaspur, Khatima and Sitarganj Blocks.
8. Dehradun district excluding Doiwala, Rampur, Sahaspur and Vikas Nagar Blocks.
(b) In respect of connections as may be located in Bundelkhand region, comprising
Jhansi, Lalitpur, Hamipur, Jalaun and Banda districts a development rebate of 50% on the
amount of the bill as computed under items 4 and 5 above will be given to new Industrial
units for a period of five years from the date of commencement of supply. This rebate
will also be admissible for the unexpired period of five years to those existing Industrial
units of the above districts of Bundelkhand region who have not completed five years
from the date of commencement of supply. This development rebate of 50% in
Bundelkhand region shall, however, not be allowed to the Departments/ Corporations/
Undertakings of the State/ Central Government and Local Bodies.
The development rebates under this clause shall be allowed subject to the condition that
the net amount payable after allowing these rebates would not be less than the amount of
minimum consumption guarantee under item 6 above."
Thereafter, on 18.6.1998 a new notification came to be issued, which is relevant for our
purpose. By this notification the bills were divided into two parts, i.e. demand charge plus
energy charge. Relevant provisions of Clauses 4,5 and 8 read as under:
" 4. RATE OF CHARGE :
(A) Demand Charge

1. Induction Furnaces Rs.700/- per KVA/ month


2. ARC FurnacesRs.615/- per KVA/ month
3. Rolling/ Re-rolling Mills Rs.440/- per KVA/ month
(B) Plus Energy Charge
All KWH consumed in the month 100 paise per month

Notes :
(i) Any consumer availing the supply for more than one process of Induction Furnace,
ARC furnace or Rolling/ Re-rolling Mill, will be charged at the applicable rate of demand
charge whichever is higher. '
(ii) The recording of demand and energy shall be done through static Trivector Meters.
5. EXTRA CHARGE OR REBATE :
(i) In case of supply given at 400 volts, the consumer shall be required to pay an extra
charge of 10 per cent on the amount calculated at the rate of charge under item (4).
(ii) If supply is given at voltage more than 11 KV, rebate mentioned below will be
admissible on the amount calculated at the rate of charge under item (4).

(a) Above 11 KV upto 66 KV 5%


(b) Above 66 KV upto 132 KV 7.5% )
(c) Above 132 KV 10%.

xx xx xx
8. CONCESSION :
The concessions mentioned hereunder shall be applicable to consumers connected upto
31.03.1997.
(a) In respect of connections as may be located in undermentioned area of hill
@page-SC698
districts in U.P. a development rebate of 17% on the demand charges only as computed
under item (4) above will be given during the unexpired period of five years to those
existing connections which have not completed five years from the date of
commencement of supply.
Provided that the above development rebate shall not be available to the Department/
Corporations/ Undertaking of State/ Central Government and Local Bodies.
DESCRIPTION OF AREA OF HILL DISTRICTS :
1. Almora district
2. Pithoragarh district
3. Chamoli district
4. Pauri Garhwal district excluding Nagarpalika area of Kotdwara.
5. Uttarkashi district
6. Tehri Garhwal district excluding Muni Ki Reti town area and Dhalwala village under
Narendra Nagar Block.
7. Nainital district excluding Haldwani, Rudrapur, Gadarpur, Kashipur, Bajpur, Ram
Nagar, Jaspur, Khatima and Sitarganj Blocks.
8. Dehradun district excluding Doiwala, Rampur, Sahaspur and Vikas Nagar Blocks.
(b) In respect of connections as may be located in Bundelkhand region, comprising
Jhansi, Lalitpur, Hamipur, Jalaun and Banda districts a development rebate of 25% on the
demand charges only as computed under item 4 above will be given during the unexpired
period of five years to those existing industrial units of the above districts of
Bundelkhand region who have not completed five years from the date of commencement
of supply. This development rebate shall however not be allowed to the
Departments/Corporations/Undertakings of the State/Central Government and Local
Bodies.."
Similar is the notification dated 25.1.1999 which is identical to the notification dated
18.6.1998. But in this notification dated 25.1.1999 the concession was not in clause 8 but
the concession has been re-numbered from clause 8 to clause 9 which is identical and as
such need not be reproduced again. As a result of these two notifications i.e. notifications
dated 18.6.1998 and 25.1.1999 two significant things happened, that the tariff was
divided into two parts i.e. demand charge plus energy charge. The energy charge was
charged earlier at 308 paise per KV was reduced to 100 paise KVA per month but the
demand charge i.e. induction furnace, ARC furnace, rolling/re-rolling mills etc. which
were fixed charges, concession was given at the rate of 17% computed under item
No.4(A) i.e. induction furnace @ Rs.700/- per KVA/ month, ARC furnace @ Rs.615/- per
KVA/month and Rolling/ Re-rolling Mills @ Rs.440/- per KVA/ month. Therefore, as a
result of restructuring of tariff, the demand charges under item 4(A) were made fixed but
the energy charges were reduced from 308 paise to 100 paise per month. It is not the case
that the appellant has completely revoked the concession. It is the case that appellant-
Corporation has reduced the energy charges from 308 paise per KVA to 100 paise but the
demand charges have been fixed per KVA/ month and the concession has been re-
scheduled instead of giving them 33.33% the energy charges have been reduced which is
applicable to all but in the case of demand charges for hill areas it has been reduced to 17
% in respect of demand A charges and that was allowed to be continued for the unexpired
period of five years to its existing connections which have not completed five years from
the date of commencement of supply. At the same time the appellant- Corporation has
denied this benefit to the State Departments/Corporations, Undertakings of the
State/Central Government and Local Bodies. Therefore, so far as the private consumers
are concerned, this has been kept intact.
4. Now, in this factual controversy, we have to examine whether the concession in the
consumption of energy which has been given to the writ petitioners for establishing the
industries in the hill areas can be revoked or modified by the appellant- Corporation or
not. The High Court has taken the view that the appellant is bound on the principle of
promissory estoppel and it cannot revoke the benefit.
5. Dr.A.M.Singhvi, learned senior counsel for the appellant has given nine reasons that
this modification of the rebate is fully justified for the following reasons :
(i) That the notifications have been issued in exercise of the statutory provisions under
Section 49 of the Act of 1948, therefore, it has statutory flavour.
(ii) That there is complete change of tariff i.e. it has two parts, (a) demand charge and
@page-SC699
(b) energy charge.
(iii) That there has been reduction in the energy consumption charges i.e. from 308 paise
to 100 paise per unit.
(iv) That there was large scale theft of energy in the State of U.P.
(v) That units were closing on account of these concessions.
(vi) That there is no total withdrawal of the rebate but by restructuring concession at the
rate of 17% continues in the demand charges.
(vii) That the High Court has failed to consider the public interest which was specifically
pleaded by filing a detailed affidavit.
(viii) That no mala fide is attributed.
(ix) That actual cost of energy production has shot up to Rs.2.50.
Therefore, learned senior counsel for the appellant submitted that the appellant-
Corporation is fully within its right to modify the rebate and the principle of promissory
estoppel cannot estop. Dr. Singhvi also submitted that the Division Bench of the High
Court has relied on a decision in Pawan Alloys and Casting Pvt. Ltd. (supra) in which no
affidavit was filed. This was not appreciated by the High Court and therefore, the whole
situation has turned on that count. Dr. Singhvi has also raised the question of laches,
estoppel, waiver and acquiesence and submitted that the earlier writ petition was filed
challenging the notification dated 18.6.1998 and it was withdrawn with liberty and
thereafter on 4.11.1999 application to recall the order was filed which was rejected.
Again, another writ petition has been filed without permission of the High Court. Dr.
Singhvi submitted that by virtue of the U.P. Electricity Reforms Act, 1999, (hereinafter to
be referred to as the Act of 1999) now the new tariff has been fixed from August, 2000-
2001 by the Commission because now the power to determine the tariff has been given to
the Commission and no estoppel against the Statute can be pleaded after the Act of 1999
having come into force. Dr. Singhvi, learned senior counsel submitted that in view of the
affidavit filed by Shri C.R.Goswami, Executive Engineer, Electricity Distribution
Division, Kotdwar, Uttarakhand on behalf of the appellant and a comparative chart has
been annexed to indicate that in fact after introduction of two part tariff, energy
consumption of these units has considerably increased. The chart has been filed along
with the affidavit in respect of all the writ petitioners except Shree Sidhbali Steels Ltd.
1997 AIR SCW 3839

6. As against this, Mr. Shanti Bhusan, learned senior counsel for the respondent- writ
petitioners submitted that these concessions were given to the hill areas in pursuance to
the direction by the State Government in exercise of power under Section 78A of the Act
of 1948 and submitted that the State Government was fully competent to do so. The
State/Corporation has made a representation on which the private entrepreneurs have
made huge investments and therefore, the State Government/ Corporation cannot wriggle
out from it and the State Government/Corp. is estopped from withdrawing these
concessions. Mr. S. Ganesh, learned senior counsel appearing for some of the writ
petitioners has also submitted that the concession which has been given has a vested right
and it can only be revoked by the same Statute.
7

. Both the learned senior counsel appearing for the parties relied on number of decisions
of this Court on the subject. Since the High Court has relied primarily on the decision of
this Court in Pawan Alloys and Casting Pvt. Ltd. (supra), therefore, it would be profitable
to first examine the said decision. In this case, the U.P. State Electricity Board by
notifications issued in exercise of powers under Section 49 of the Act of 1948 held out
promises to the industrial units established in different parts of the State of U.P. and they
were given concession in the electricity charges to the extent of 10 per cent of rebate for a
period of three years for the first time and the same was prematurely withdrawn by
subsequent notification which gave rise to number of writ petitions being filed in the
High Court and the principle of promissory estoppel was invoked. In the writ petitions it
was contended that when rebate was given to the new industrial units for a period of three
years, the Board could not have arbitrarily withdrawn the same prior to the expiry of a
period of three years. It was contended that such withdrawal of concession is applicable
prospectively and cannot have retrospective effect to the earlier existing industrial units.
The Board contested the matter. The Allahabad High Court framed the following three
questions. (i) Whether the Board is estopped from withdrawing the said rebate before the
completion of the 3/5 year period, by virtue of the 1997 AIR SCW 3839, (Paras 31 and
32)

@page-SC700
doctrine of promissory estoppel ? (ii) Whether the agreement executed by the petitioners
bars them from questioning the impugned notification ? (iii) Whether the impugned
notification has no application to existing consumers and does it apply to only those
consumers who receive the supply on or after 1-8-1986 ? The High Court after hearing
the contesting parties came to the conclusion that the respondent-Board was estopped by
virtue of the doctrine of promissory estoppel from withdrawing the development rebate
before the completion of the period of three years. On second point, the High Court came
to the conclusion that the writ petitioners were barred from questioning the impugned
notification on the express terminology found in the agreements entered into by them
with the Board for supply of electricity and under those agreements the Board was given
full play to revise the tariff rates which included development rebate also from time to
time and consequently the impugned notification was not illegal. On the third issue, it
was held that the notification dated 31-7-1986 could not be said to be retrospective and
consequently, the High Court dismissed all the writ petitions. Aggrieved against this, the
matter came up before this Court by Pawan Alloys and Casting Pvt. Ltd. This Court after
review of all the earlier decisions observed as follows - :
"34. Consequently it must be held that relying upon the representations held out by the
Board in these earlier notifications assuring grant of incentive rebate of 10% on the total
bill of electricity consumption charges these new industries being assured that for three
years this concession will be available had burnt their boats and spent large amounts and
had established their industries in the area falling in the operative jurisdiction of the
Board in the State of U.P.
35. Under these circumstances when no public interest was sought to be pressed into
service by the Board for withdrawal of this incentive rebate, as seen earlier, the equity
which had arisen in favour of the appellants remained untouched and undisturbed by any
overwhelming and superior equity in favour of the Board entitling it to withdraw this
development rebate in a premature manner leaving these promises high and dry before
the requisite period of three years earlier guaranteed to them by way of development
rebate had got exhausted. This takes us to the consideration of the second aspect of the
matter."
8. Dr. Singhvi, learned senior counsel for the appellant-Corporation emphasized that in
fact the whole case turned on the question that no public interest was sought to be pressed
into service by the Board on the incentive rebate. But, in the present case, specific
affidavit was filed and all the detailed facts were disclosed pertaining to the public
interest but that was not dealt with by the High Court. Therefore, Pawan Alloys and
Casting Pvt. Ltd. (supra) case stands distinguished. Learned senior counsel submitted that
if proper public interest had been pleaded in Pawan Alloys and Casting Pvt. Ltd.(supra)
then perhaps the situation would have been different. In this connection, learned senior
counsel for the appellant-Corporation invited our attention to the question of public
interest which was pleaded before the High Court and which was not considered by the
High Court. Learned senior counsel for the appellant- Corporation submitted that all the
nine points which have been mentioned above were mentioned in the counter affidavit
filed by the appellant-Corporation before the High Court and in that connection, he
invited our attention to paragraphs 5, 6, 7, 10, 40, 42, 44, 48 of the counter affidavit and
specifically invited our attention to paragraph 53 that the Corporation is incurring a loss
of Rs.15 to 20 crores. Learned senior counsel also invited our attention to paragraphs 56,
58 and 60 of the counter affidavit filed before the High Court and submitted that it was
not in public interest to continue this benefit to these industries located in hill areas and
further submitted that the entire benefit was not withdrawn. This benefit has been
rationalized and as a result of this rationalization an affidavit was filed to show that the
energy consumption of these units has increased to manifold. Therefore, this restructuring
of the rebate has not proved disadvantageous to these industries but for the larger public
interest this was done and it not a case that the appellant has totally revoked the
concession but the concession still exists in modified form. Therefore, the whole exercise
was done in the public interest only. Learned senior counsel stressed that in fact all this
public interest was not disclosed in Pawan Alloys and Casting Pvt. Ltd. (supra).
Therefore, this turned against the
@page-SC701
Board on that count. In the present case all the nine points raised by him were raised
before the High Court of Allahabad but the High Court has totally ignored the same.
9

. Learned senior counsel for the appellant-Corporation also invited our attention to
another decision of this Court in Kasinka Trading and Anr. v. Union of India and Anr.
[ (1995) 1 SCC 274]. In this case, a notification was issued under Section 25 (1) of the
Customs Act in public interest exempting from basic duty and specific date to which it
will remain in force. Prior to expiry of that date another notification was issued in
exercise of same power in public interest withdrawing the exemption on excise duty on
the materials imported. Public interest was explained by the Government and in that
context, it was held that Government being satisfied about the public interest in
withdrawing the exemption no unequivocal representation or promise extended by merely
specifying the period of operation of the exemption notification so as to attract the
doctrine of promissory estoppel. It was pointed out that exemption under Section 25 was
not in the nature of any incentive and has the effect of only suspending levy and
collection of customs duty and can be revoked or withdrawn in public interest. It was
further observed that when exemption is granted in exercise of statutory powers, it is
implicit that it can also be rescinded or modified at any time in exercise of the same
power and it was observed that withdrawal of exemption is a matter of Government
policy with which the Court would not in the absence of any manifest injustice, mala
fides or fraud interfere. It was observed as follows : 1995 AIR SCW 680, (Paras 13 and
19)
"The doctrine of promissory estoppel is applicable against the Government also
particularly where it is necessary to prevent fraud or manifest injustice. The doctrine,
however, cannot be pressed into aid to compel the Government or the public authority "
to carry out a representation or promise which is contrary to law or which was outside the
authority or power of the officer of the Government or of the public authority to make".
To invoke the doctrine of promissory estoppel clear, sound and positive foundation must
be laid in the petition itself by the party invoking the doctrine. Bald expressions, without
any supporting material, to the effect that the doctrine is attracted because the party
invoking the doctrine has altered its position relying on the assurance of the Government
would not be sufficient to press into aid the doctrine. The doctrine of promissory estoppel
cannot be invoked in the abstract and the courts are bound to consider all aspects
including the results sought to be achieved and the public good at large, because while
considering the applicability of the doctrine, the courts have to do equity and the
fundamental principles of equity must for ever be present in the mind of the court, while
considering the applicability of the doctrine. The doctrine must yield when the equity so
demands if it can be shown having regard to the facts and circumstances of the case that
it would be inequitable to hold the Government or the public authority to its promise,
assurance or representation."
However, it was also observed as follows - :
"The reasons given by the Union of India justifying withdrawal of the exemption
notification are not irrelevant to the exercise of the power in "public interest", nor are the
same shown to be insufficient to support the exercise of that power. The exemption
notification was not issued as a potential source of extra profit for the importer. Again, at
the same time when the notification was withdrawn by the Government there was no
scope for any loss to be suffered by the importers. The exemption notification did not
hold out to the appellants any enforceable promise. Neither the notification was of an
executive character nor did it represent a scheme designed to achieve a particular
purpose. It was a notification issued in public interest and again withdrawn in public
interest."
10. Our attention was also invited to a decision of this Court in Shrijee Sales Corporation
and Anr. v. Union of India [(1997) 3 SCC 398]. In this case it was observed as follows :

"Moreover, the Government is competent to resile from a promise even if there is no


manifest public interest involved, provided, of course, no one is put in any adverse
situation which cannot be rectified. Even where there is no such overriding public
interest, it may still be within the competence of the Government to resile from the
promise on giving reasonable notice which need not be a formal notice, giving the
promisee a 1995 AIR SCW 680

@page-SC702
reasonable opportunity of resuming his position, provided, of course, it is possible for the
promisee to restore the status quo ante. If, however, the promisee cannot resume his
position, the promise would become final and irrevocable."
This case in turn followed Kasinka Trading (supra).
11
. Our attention was invited to a decision of this Court in Sales Tax Officer and Anr. v.
Shree Durga Oil Mills and Anr. [ (1998) 1 SCC 572]. In this case it was held that the
Government was competent to change its policy in public interest on the basis of resource
crunch and that would be sufficient for non-applicability of the rule of promissory
estoppel. Their Lordships held that public interest can override consideration of private
loss or gain. Any Industrial Policy Resolution (IPR) can be changed by the State looking
to its severe economic crunch and in this case the respondent sought to invoke this IPR
which was issued on 18.7.1979 and was effective for the period 1979-83. The respondent
established its industry on 28.11.1979. Therefore, on factual aspect also this Court found
that within four months of establishment of industry, the respondent was not likely to
suffer any loss. But at the same time, their Lordships observed as follows : 1998 AIR
SCW 186, (Para 17)

"Any IPR can be changed if there is an overriding public interest involved. In the instant
case, it has been stated on behalf of the State that various notifications granting sales tax
exemptions to the dealers resulted in severe resource crunch. On reconsideration of the
financial position, it was decided to limit the scope of the earlier exemption notifications
issued under Section 6 of the Orissa Sales Tax Act. Because of this new perception of the
economic scenario of the State, the scope of the earlier notifications had to be restricted.
Withdrawal of notification was done in public interest. The Court will not interfere with
any action taken by the Government in public interest. Public interest must override any
consideration of private loss or gain. Thus the plea of change of policy trade on the basis
of resource crunch should have been sufficient for dismissing the respondent's case based
on the doctrine of promissory estoppel."
12

. Our attention was invited to another decision of this Court in State of Rajasthan and Anr.
v. Mahaveer Oil Industries and Ors. [(1999) 4 SCC 357]. In this case also Government of
Rajasthan gave sales tax incentive scheme for industries in 1987 exempting new
industrial units from the tax on sale of goods manufactured by them for sale within the
State for a specified period i.e. from 5.3.1987 to 31.3.1997. Oil extraction and
manufacturing was one of the industries eligible to the benefit of the scheme but the same
was revoked. On facts it was found that the Scheme had failed to achieve its object and
had rather adversely affected the oil industry. In this situation, it was held that the
Government can in public interest revoke the policy and the doctrine of promissory
estoppel cannot preclude the Government from issuing such notification and on facts it
was found that the respondent had not taken any effective steps for starting a new unit
prior to the issuance of the notification. It was observed as follows : 1999 AIR
SCW 2369, (Para 14)

"Public interest requires that the State be held bound by the promise held out by it in such
a situation. But this does not preclude the State from withdrawing the benefit
prospectively even during the period of the Scheme, if public interest so requires. Even in
a case where a party has acted on the promise, if there is any supervening public interest
which requires that the benefit be withdrawn or the Scheme be modified, that
supervening pubic interest would prevail over any promissory estoppel."
13

. As against this, Mr.Shanti Bhushan, learned senior counsel appearing for the
respondents has submitted that in view of Section 78-A of the Act of 1948 a direction was
issued by the State Government for giving this development concession and the State was
competent to give such direction and in pursuance of that the hill development rebate was
given. Mr.Shanti Bhushan submitted that it will be arbitrary and unfair if those
entrepreneurs who have established their industries on the representation made by the
State that they will be given certain concessions and in pursuance of that they have made
huge investments and now that the concession has been withdrawn it will ruin those
entrepreneurs and therefore, the appellant-Corporation is estopped from going back from
their representation. In this connection, he principally relied on a decision of this Court in
M/s. Motilal Padampat Sugar Mills Co. Ltd. v. State of Uttar Pradesh and Ors. AIR
1979 SC 621

@page-SC703
[(1979) 2 SCC 409] and specially invited our attention to paragraph 24 of the judgment.
In paragraph 24, their Lordships have summed up the ratio of the earlier decisions given
by this Court as follows :

"Under our jurisprudence the Government is not exempt from liability to carry out the
representation made by it as to its future conduct and it cannot on some undefined and
undisclosed ground of necessity or expediency fail to carry out the promise solemnly
made by it, nor claim to be the judge of its own obligation to the citizen on an ex parte
appraisement of the circumstances in which the obligation has arisen. The law may,
therefore, now be taken to be settled as a result of this decision, that where the
Government makes a promise knowing or intending that it would be acted on by the
promisee and, in fact, the promisee, acting in reliance on it, alters his position, the
Government would be held bound by the promise and the promisee would be enforceable
against the Government at the instance of the promise, notwithstanding that there is no
consideration for the promise and the promise is not recorded in the form of a formal
contract as required by Article 299 of the Constitution. It is elementary that in a republic
governed by the rule of law, no one howsoever high or low, is above the law. Everyone is
subject to the law as fully and completely as any other and the Government is no
exception. It is indeed the prides of constitutional democracy and rule of law that the
Government stands on the same footing as a private individual so far as the obligation of
the law is concerned; the former is equally bound as the latter. It is indeed difficult to see
on what principle can a Government, committed to the rule of law, claim immunity from
the doctrine of promissory estoppel. Can the Government say that it is under no
obligation to act in a manner that is fair and just or that it is not bound by considerations
of "honesty and good faith"? Why should the Government not be held to a high standard
of rectangular rectitude while dealing with its citizens"? There was a time when the
doctrine of executive necessity was regarded as sufficient justification for the
Government to repudiate even its contractual obligations; but, let it be said to the eternal
glory of this Court, this doctrine was emphatically negatived in the Indo-Afghan
Agencies case and the supremacy of the rule of law was established. It was laid down by
this Court that the Government cannot claim to be immune from the applicability of the
rule of promissory estoppel and repudiate a promise made by it on the ground that such
promise may fetter its future executive action. If the Government does not want its
freedom of executive action to be hampered or restricted, the Government need not make
a promise knowing or intending that it would be acted on by the promisee and the
promisee would atter his position relying upon it. But if the Government makes such a
promisee and the promise acts in reliance upon it and alters his position, there is no
reason why the Government should not be compelled to make good such promise like
any other private individual. The law cannot acquire legitimacy and gain social
acceptance unless it accords with the moral values of the society and the constant
endeavour of the Courts and the legislature must, therefore, be to close the gap between
law and morality and bring about as near an approximation between the two as possible.
The doctrine of promissory estoppel is a significant judicial contribution in that direction.
But it is necessary to point out that since the doctrine of promissory estoppel is an
equitable doctrine, it must yield when the equity so requires.". AIR 1968 SC 718

Mr.Shanti Bhushan emphasized on the basis of this observation made in this case that
benevolent Government has to act with equity and the Court should yield in favour of the
equity whenever case arises of a citizen who has acted bona fidely on the basis of the
representation made by the Government or by the instrumentality of the State. Mr. Shanti
Bhushan submitted that since representation was made by the appellant-Corporation,
therefore, industries were established in the hill areas and now the appellant-Corporation
wanted to change the tariff that will be unconstitutional, unfair and arbitrary to the
citizens who have acted on the promise made by the appellant-Corporation. In this
connection, Mr. Shanti Bhushan also submitted that this is violative of Article 14 of the
Constitution as held in MRF Ltd., Kottayam v. Asstt. Commissioner (Assessment), Sales
Tax and Ors. [(2006) 8 SCC 702]. In that case, the Court held that revocation of such
notification is arbitrary and one of us (Hon'ble Katju, J.) was a party to the judgment. In
this case the concept of 2006 AIR SCW 5272

@page-SC704
doctrine of legitimate expectation was invoked. In this case, the State of Kerala issued
notification granting exemption for expansion in the manufacture of certain products
including rubber-based goods. The assessee manufacturer relying on that introduction of
exemption commenced commercial production after investing huge amount. This
concession was granted for a fixed period of seven years. But during the currency of the
period of exemption the State Government issued another notification excluding the
formation of a compound rubber from the definition of "manufacture" for the purpose of
the original exemption notification. Therefore, this premature deprivement of the
exemption to the assessee manufacturer was held by the Court arbitrary, unjust and
unreasonable. Their Lordships invoked the doctrine of legitimate expectation. It was
contended before the Court that the notification was a statutory one and no plea of
estoppel would lie against the statute. But their Lordships held that the principle of
underlying legitimate expectation was based on Article 14 of the Constitution and any
action taken by the State which went against the rule of fairness was liable to be struck
down. Finally this Court after review of the cases on the subject, invoked the principle of
promissory estoppel and also the legitimate expectation and found that the revocation of
the exemption granted for a period of seven years by the State Government was arbitrary,
unjust and unreasonable and was liable to be quashed. It was observed as follows :

"This Court in E. P. Royappa v. State of T.N. [(1974) 4 SCC 3] observed that where an act
is arbitrary, it is implicit in it that it is unequal both according to political logic and
constitutional law and is therefore violative of Article 14. Equity that arises in favour of a
party as a result of a representation made by the State is founded on the basic concept of "
justice and fair play". The attempt to take away the said benefit of exemption with effect
from 15-1-1998 and thereby deprive MRF of the benefit of exemption for more than 5
years out of a total period of 7 years, in our opinion, is highly arbitrary, unjust and
unreasonable and deserves to be quashed. .. .." AIR 1974 SC 555

14

. Mr. Shanti Bhushan, learned senior counsel invited our attention to paragraph 33 of the
judgment in Pawan Alloys and Casting Pvt. Ltd.(supra) and submitted that in fact an
argument was made at the Bar that the high-powered Tariff Realisation Committee
advised the Board for withdrawing this rebate and the Board acted in the light of the said
report submitted to it in the year 1986. It was submitted that the genesis of the
notification was the recommendation of the Tariff Realisation Committee. Therefore, the
Court concluded that the rebate was revoked not on the ground of general public interest
but solely on the ground of commercial interest of the Board. Therefore, it was observed
as follows : 1997 AIR SCW 3839, (Para 30)

"Consequently it must be held on the facts of these cases that the impugned withdrawal
notification was not backed up by any demands of public interest which would outweigh
the individual interests of the appellant-promisees who had acted upon the same."

Mr. Shanti Bhushan, learned senior counsel submitted that in the present case also, the
revocation is not on the basis of general public interest but it is only on account of losses
the Corporation trying to make up the losses revoked this concession. Therefore, learned
senior counsel submitted that it is not the consideration of general public interest but
based on the commercial angle. Learned senior counsel invited our attention to the
decision in Kasinka Trading and Anr. (supra), specially to paragraph 21 of the judgment
and submitted that, that case is distinguishable on the ground that it only suspended the
levy and collection of customs duty wholly or partially and there was no promise for
benefit to public at large. Thus, the exemption notification issued under Section 25(1) of
the Customs Act is an exercise of the statutory power of the State under the law itself and
the State can revoke the same as per General Clauses Act. Therefore, Mr. Shanti Bhushan
distinguished the case of Kasinka Trading (supra) that the said case was not the case in
which any promise was made and on which the assessee has acted and invoked certain
benefits. It was a general notification giving certain benefits and it was revoked back in
public interest. Learned senior counsel invited our attention to a decision of this Court in
Shrijee Sales Corporation and Anr. (supra) and submitted that it was not an inducement
but a case of promissory estoppel when a promise is made and 1995 AIR SCW 680
1995 AIR SCW 680
1998 AIR SCW 186

@page-SC705
citizen is induced to act on those representation, then in that case, once the party has
suffered on account of so called inducement, then in that case it cannot be revoked to the
disadvantage of the other party. Learned senior counsel submitted that in Shrijee Sales
Corporation and Anr. (supra) and Shree Durga Oil Mills and Anr.(supra) certain tax
exemption was given and subsequently it was revoked and learned senior counsel
submitted that those cases are distinguishable, that there were not the cases in which
inducement was made, and the party acted on that inducement. Those were the cases
where exemption was given on customs and sales tax but it was not in the nature of
inducement or any representation or promise on the part of the other party to encourage
the entrepreneurs to come and make their investments.
15

. Learned senior counsel invited our attention to a decision of this Court in State of
Punjab v. Nestle India Ltd. and Anr. [(2004) 6 SCC 465] in which a representation was
made by the Government in the manner de hors the Rules but a statement was made by
the Finance Minister in his Budget speech for 1996-97 making representation to the effect
that the State Government had abolished purchase tax on milk. The manufacturers of
milk products, therefore, were not paying the purchase tax on milk for the assessment
year 1996-97 and mentioned this fact in their returns. The taxing authority entertained
such returns. The manufacturers passed on the benefit of exemption to the dairy farmers
and milk producers. However, after expiry of the said assessment year, the Government
took a decision not to abolish purchase tax on milk and the taxing authority therefore
raised a demand for the assessment year 1996-97. On these facts, the Court held that in
absence of proof of any overriding public interest rendering the enforcement of estoppel
against the Government was inequitable, notwithstanding that no exemption notification
as required by the statute was issued. It was held that the State Government cannot resile
from its decision to exempt milk and raise a demand for the aforesaid assessment year.
However, the same principle of estoppel was not invoked after assessment year 1996-97.
The Court enforced the principle of estoppel. All the earlier cases on the subject were
reviewed by the Court and ultimately it was concluded as follows : 2004 AIR SCW 3703

"47. The appellant has been unable to establish any overriding public interest which
would make it inequitable to enforce the estoppel against the State Government. The
representation was made by the highest authorities including the Finance Minister in his
Budget speech after considering the financial implications of the grant of the exemption
to milk. It was found that the overall benefit to the State's economy and the public would
be greater if the exemption were allowed. The respondents have passed on the benefit of
that exemption by providing various facilities and concessions for the upliftment of the
milk producers. This has not been denied. It would, in the circumstances, be inequitable
to allow the State Government now to resile from its decision to exempt milk and
demand the purchase tax with retrospective effect from 1-4-1996 so that the respondents
cannot in any event readjust the expenditure already made. The High Court was also right
when it held that the operation of the estoppel would come to an end with the 1997
decision of the Cabinet."

Similarly, our attention was invited to paragraph 16 of the judgment in Shree Durga Oil
Mills and Anr.(supra). Mr.Shanti Bhushan submitted that in the aforesaid case Section 6
of the Orissa Sales Tax Act clearly contemplated that the State Government can grant
exemption from sales tax and likewise withdraw any such exemption. Learned senior
counsel submitted that so far as Section 49 of the Act of 1948 is concerned, there is no
such contemplation that it can also revoke the same. It is only because of the provisions
of the General Clauses Act it can be revoked but not once granted under Section 49(3) of
the Act of 1948, there is no provision for any revocation of the exemption granted to
certain class of persons having regard to the geographical condition of the area, the nature
of supply and the purpose for which supply is required and other relevant factors.
Mr.Shanti Bhushan also submitted that there is no allegation of theft in the hill area by
the persons to whom the power had been granted at a concessional rate. And all the
circumstances which have been taken into consideration for revocation of the exemption
notification show that there was no overwhelming consideration for 1998 AIR
SCW 186

@page-SC706
revoking such exemption in public interest.
16

. Mr. S. Ganesh, learned senior counsel appearing for some of the respondents invited our
attention to a decision of this Court in Mahabir Vegetable Oils (P) Ltd. and Anr. v. State
of Haryana and Ors. [(2006) 3 SCC 620]. In this case, the appellants were the owner of
solvent extraction plants. Industrial policy for the period 1.4.1988 to 31.3.1997 granted
incentive by way of sales tax exemption to the industries set up in backward areas in the
State. Solvent at that time was not included in the negative list in the Rules. In August,
1995 the appellants purchased land to set up a new unit and they made huge amount in
construction work, erection of plant and that investment constituted 45% of the total
investment. They started trial production on 26.3.1997 and commercial production on
29.3.1997 and then they applied for grant of exemption for payment of sales tax.
Meanwhile, the State Government notified its intention to amend the Haryana General
Sales Tax Rules and invited objections and thereafter they issued notification on
16.12.1996 which included solvent extraction plants in the negative list but Note 2
appended to that list provided that the industrial units which had made investment up to
25% of the anticipated cost of the project and which had been included in the negative list
for the first time would be entitled to the sales tax benefits related to the extent of
investment made up to 3.1.1996. On 28.5.1997 Note 2 was omitted. As a result of this,
the appellants were deprived of the benefit and consequently, the Department rejected the
application for exemption. This was challenged unsuccessfully before the High Court and
ultimately the matter reached this Court and this Court held that the incumbents had made
huge investment pursuant to and in furtherance of the representation made by the State
Government and the State Government without assigning any reason withdrew the
exemption with retrospective effect at the end of the operative period. The retrospective
withdrawal of the exemption was found to be bad in law. In this context, their Lordships
observed as follows: 2006 AIR SCW 1500

"Undisputedly, when the appellants started making investments, Rule 28-A was
operative. Representation indisputably was made in terms of the said Rules. The relevant
provisions of the Act and the Rules framed thereunder indisputably were made keeping in
view the industrial policy of the State."
Their Lordships held that the doctrine of promissory estoppel will operate even in the
legislative field. Learned senior counsel submitted that such concession which has been
granted cannot be revoked as the beneficiary acquired a vested right and the same can
only be revoked by the Statute.
17. In this background, in view of various decisions noticed above, it will appear that the
Court's approach in the matter of invoking the principle of promissory estoppel depends
on the facts of each case. But the general principle that emerges is that once a
representation has been made by one party and the other party acts on that representation
and makes investment and thereafter the other party resiles, such act cannot stated to be
fair and reasonable. When the State Government makes a representation and invites the
entrepreneurs by showing various benefits for encouraging to make investment by way of
industrial development of the backward areas or the hill areas, and thereafter the
entrepreneurs on the representations so made bona fidely make investment and thereafter
if the State Government resile from such benefits, then it certainly is an act of unfairness
and arbitrariness. Consideration of public interest and the fact that there cannot be any
estoppel against a Statute are exceptions.
18

. Learned senior counsel for the appellant has cited nine instances which can be loosely
categorised into two i.e. (i) that there cannot be any estoppel against the statute and (ii)
overriding public interest. So far as the first part is concerned i.e. the revocation has the
statute flavour i.e. the benefit which was extended under Section 49 of the Act of 1948
and the notification had been issued revoking the same benefit under Section 49 of the
Act of 1948 by invoking the provisions of the General Clauses Act that an authority
granting exemption has a right to revoke the same also. It is true that it has a right to
revoke the same but if the other party has suffered on that account then such
representation will be against the public policy and the morality. Notification issued
under Section 49 of the Act of 1948 for giving the benefit of exemption for the hill areas
was in the nature of delegated legislation and not an Act framed by the State Legislature.
Therefore, a distinction has to1998 AIR SCW 186

@page-SC707
be made between the delegated legislation and the primary legislation framed by the
Legislature. In Section 49 there is no specific stipulation that the notification issued under
Section 49 of the Act of 1948 can be revoked at any time as was in the case of Shree
Durga Oil Mills and Anr. (supra) where Section 6 of the Orissa Sales Tax Act itself
provided that the notification is capable of being revoked at any time. Therefore, a
distinction has to be made between the delegated legislation and the primary legislation.
So far as the primary legislation is concerned, if the Act is passed by State Legislature
and denies the benefit by the primary legislation then no estoppel can be applied against
that Act but so far as the case of delegated legislation is concerned, where delegated
authorities passes certain notification in exercise of his delegated authority there is no
contemplation mentioned in the Act itself that it is capable of being revoked at any time.
Then such Acts cannot be treated at par with the primary Act passed by the State
Legislature. The State is fully competent to pass an Act prospectively as well as
retrospectively but retrospectivity to the extent of aforesaid nature cannot stand.
Therefore, this distinction has to be borne in mind. In the present case, the U.P. Electricity
Reforms Act, 1999 came into force with effect from 2000. Therefore, if such benefit has
not been extended then a different stand will follow but so far as the delegated legislation
is concerned, this kind of revocation cannot be sustained. It is highly against the public
morality that the incumbent who have felt persuaded on account of the representation
made by the State Government that they will be given certain benefits and they acted on
that representation, it does not behove on the part of the appellant-Corporation to
withdraw the said benefit before expiry of the stipulated period by issuing the notification
revoking the same which the respondents were legitimately entitled to avail. We fail to
understand why the appellant-Corporation which made a representation and allowed the
other party to act upon such representation could resile and leave the citizens in a lurch.
In such a situation the principle of promissory estoppel which has been evolved by the
Courts which is based on public morality cannot permit the State to act in such an
arbitrary fashion. Other grounds for the purpose of public interest which have been
pleaded; namely that there are two methods of tariff provided by the amendment and the
actual consumption has been reduced based on the calculation of energy charges per KV
from 308 paise to 100 paise and there was large scale theft or that units were closing
down and there was no mala fide intention in the matter of revocation of the notification
and the cost of production of power has gone up to Rs.2.50 per unit, are considerations
which hardly involve any public interest. They were more of a nature of losses which has
been suffered by the Corporation and in order to make these losses, these methods were
evolved to reduce and to make good of the losses. Restructuring benefit to 17% of the
Tariff 4(A) (demand charges) are the factors which are aimed at to make the losses good
for the Corporation. This is not case in which serious public repercussion was involved.
These are not the factors which put together can constitute a public interest. Theft of the
energy if it was proved by cogent datas that as a result of giving this benefit to the
entrepreneurs in the hill areas, they were misusing it or there was theft of the energy at a
large scale by these persons to whom the concession had been given then of course such
factors, if all the datas were brought on record of course could have persuaded the Court
to take a different view of the matter. But simply because there was theft of energy allow
the State cannot persuade us to hold that the revocation of such concession can be said to
be in public interest. Since the benefit was given to these units in the hill areas, there
should have been overwhelming evidence to show some mala fide on the part of these
consumers which have persuaded the Corporation to revoke it. If there was no misuse of
the energy by these units in the hill areas to whom the concession had been granted then
in that case it cannot be taken that there was really public interest involved which
persuaded the Corporation to revoke the same. No person can be permitted to misuse the
concession or benefit and invoke promissory estoppel. Promissory estoppel is not one
sided affair, it is rather two sided affair. If one party abuses the concession then it is
always open to the other party to revoke such concession but if one party avails the
benefit and is acting on the same representation made by the other party then the other
@page-SC708
party who has granted the said benefit cannot revoke the same under the garb of public
interest. Therefore the grounds that the revocation notification was issued in public
interest and that same has the flavour of the statute, cannot persuade us to uphold it.
sustained. It is true that a detailed statement was given in various paragraphs of the
written statement filed by the appellant-Corporation before the Allahabad High Court and
unfortunately, the High Court did not advert to these details but we have examined all
these details and found that all the nine points raised by Dr. Singhvi does not persuade us
to take a contrary view from the view taken by the High Court. There is no gainsaying
that the public interest is paramount and the private interest has to be sacrificed for the
larger interest. But, after survey of all these cases on the subject, the judicial consensus
that emerges is that whenever the State has made a representation to the public and the
public has acted on that representation and suffered economically or otherwise, then in
that case the State should be estopped from withdrawing such benefit to the detriment of
the such people except in public interest or against the Statute. So far as the public
interest as involved in the present case is concerned, we have found that there was no
overwhelming evidence to revoke the benefit granted to the industrial units in the hill
areas. So far as the Statute is concerned, the notification was issued under Section 49 of
the Act of 1948 and the same was revoked under Section 49 of the Act of 1948 though
there was no such provision contained in Section 49 that it will be open to the
Corporation to revoke the same but could be possible by invoking the principle of
General Clauses Act. But in such delegated legislation such withdrawal could only be
permitted if larger public interest is involved or if the Act is passed by legislature.
19. Dr. Singhvi, learned senior counsel for the appellant-Corporation submitted that now
the Act of 1999 has come into force and that Act does not recognize the concessions
given to the hill areas and that this is a primary legislation i.e. Act passed by the State
Legislature. Therefore, to this extent we can accept the submission of Dr. Singhvi that
since the Act of 1999 does not recognize such hill developmental benefits, therefore,
from the date of passing of the Act of 1999 the said benefit cannot be accepted. We have
stated above that there cannot be estoppel against a statute. Since such benefits have not
been recognised by the Act of 1999, therefore, up to the date of coming into force of the
Act of 1999, all the benefits which were being given to the respondent- entrepreneurs
shall be protected by invoking the principle of promissory estoppel but after coming into
force of the Act of 1999, which is a primary legislation enacted by the State Legislature
the benefits from the date the Act has come into force, cannot be made available to the
respondents.
20. In this 21st century, when there is global economy, the question of faith is very
important. Government offers certain benefits to attract the entrepreneurs and the
entrepreneurs act on those beneficial offers. Thereafter, the Government withdraws those
benefits. This will seriously affect the credibility of the Government and would show the
shortsightedness of the governance. Therefore, in order to keep the faith of the people, the
Government or its instrumentality should abide by their commitments. In this context, the
action taken by the appellant-Corporation in revoking the benefits given to the
entrepreneurs in the hill areas will sadly reflect their credibility and people will not take
the word of the Government. That will shake the faith of the people in the governance.
Therefore, in order to keep the faith and maintain good governance it is necessary that
whatever representation is made by the Government or its instrumentality which induces
the other party to act, the Government should not be permitted to withdraw from that.
This is a matter of faith.
21. Therefore, as a result of our above discussion, we hold that the view taken by the
Allahabad High Court on revoking the principle of promissory estoppel is correct and the
respondent- units will be entitled to such benefits till the U.P. Electricity Reforms Act,
1999 came in to force. Since after coming into force the Act of 1999 no such concession
has been granted, therefore, the concession shall survive till the Act of 1999 came into
force. The appeals are accordingly disposed of with no order as to costs
Order accordingly.
@page-SC709
AIR 2008 SUPREME COURT 709 "Atma Singh v. State of Haryana"
(From : Punjab and Haryana)*
Coram : 2 G. P. MATHUR AND D. K. JAIN, JJ.
Civil Appeal Nos. 3148-3157 of 2000, D/- 7 -12 -2007.
Atma Singh (died) through L. Rs. and Ors. v. State of Haryana and Anr.
(A) Land Acquisition Act (1 of 1894), S.23 - ACQUISITION OF LAND - SALE -
Compensation - Determination - Comparable sales - Sale instances of small pieces of
land - Relevancy - Large tract of land acquired - Acquired land having potentiality for
being used as commercial, industrial and residential purposes - Exemplars of small plots -
Cannot be disregarded in such cases specially when exemplars of large pieces of land are
not available. (Para 8)
(B) Land Acquisition Act (1 of 1894), S.23 - ACQUISITION OF LAND - SALE -
Compensation - Determination - Large tract of land acquired - Determination of market
value on exemplars of sale of small plots - Percentage of cut to be applied - Depends
upon purpose for which acquisition is made - Land acquired for setting-up factory - Gives
good returns - Deduction from price exhibited by the exemplars even if they are of small
plots - Not justified - On facts deduction of 10% allowed in case of land acquired for
sugar factory.
The reasons given for the principle that price fetched for small plots cannot form safe
basis for valuation of large tracts of land, are that substantial area is used for development
of sites like laying out roads, drains, sewers, water and electricity lines and other civic
amenities. Expenses are also incurred in providing these basic amenities. That apart it
takes considerable period in carving out the roads, making sewers and drains and waiting
for the purchasers. Meanwhile the invested money is blocked up and the return on the
investment flows after a considerable period of time. In cases of acquisition made for
setting up factory, the factory would produce goods worth many crores in a year. An
industry established on acquired land, if run efficiently, earns money or makes profit
every year. The return from the land acquired for the purpose of Housing Colony, or
Offices, or Institution cannot even remotely be compared with the land which has been
acquired for the purpose of setting up a factory or industry. After all the factory cannot be
set up without land and if such land is giving substantial return, there is no justification
for making any deduction. (Paras 13, 14)
Cases Referred : Chronological Paras
2004 AIR SCW 797 : AIR 2004 SC 1800 12
2002 AIR SCW 4644 : AIR 2003 SC 202 9
(1996)11 SCC 542 12
1995 AIR SCW 3655 : AIR 1995 SC 2481 12
1992 AIR SCW 2791 : AIR 1992 SC 2298 9
AIR 1990 SC 2192 4
AIR 1989 SC 1222 5
AIR 1988 SC 943 4, 5, 10
AIR 1988 SC 1652 11
AIR 1984 SC 892 5
AIR 1979 SC 472 5
AIR 1977 SC 1560 4
AIR 1976 SC 2219 4
AIR 1969 SC 465 5
Manjit Singh, A. A. G., M. L. Varma, Mahendra Anand, Anoop G. Choudhary, Rakesh
Dwivedi, Brijender Chahar, Sr. Advocates, Rishi Malhotra, Prem Malhotra, Chander
Shekhar Ashri, T. V. George, Vinay Garg, Abhinav Jain, Mrs. Jyoti Chahar, Mrs. Deepam
Garg, Jagbir Singh Malik, Devendra Kumar Singh, S. K. Bansal, Mrs. Savitri Bansal,
Roopak Bansal and Dr. Kailash Chand, for the appearing parties.
* RFA Nos. 373-377, 690 to 693 and 378 of 1986, D/- 4-1-1989 (PandH).
Judgement
1. G. P. MATHUR, J. :- These appeals, by special leave, have been preferred against the
judgment and decree dated 4.1.1989 of High Court of Punjab and Haryana at Chandigarh,
by which 17 appeals preferred by claimant-appellants (landowners) against the common
judgment and award of the Additional District Judge, Kurukshetra, dated 31.8.1985 had
been decided. The claimant-appellants had sought enhancement of the amount of
compensation for acquisition of their land.
2. A notification under Section 4 of the Land Acquisition Act (hereinafter referred to as
'the Act') was issued for acquisition of 89 acres and 3 marlas of land for construction of a
co-operative sugar mill. The land was situate as one compact unit in four villages viz.
Kankar Shahbad, Chhapra, Jandheri and Jhambara and belonged to 17 families. In
response to the notice issued by the Collector under Section 9 of the Act, landowners
filed objections claiming compensation
@page-SC710
for their land which had been acquired. The Land Acquisition Collector, after holding an
enquiry, gave an award on 14.7.1983 under Section 11 of the Act. The Collector gave
award on the basis of quality of land, for which purpose he divided the acquired land in
seven categories and the market value was assessed at Rs.6,000/- to Rs.35,000/- per acre
for different types of lands. Feeling aggrieved by the award of the Collector, the
appellants herein (landowners) sought reference to the Court under Section 18 of the Act.
The learned Additional District Judge awarded compensation at a flat rate of Rs.43,000/-
per acre by placing reliance on Ex. R-6 and R-7, two instances of sale deeds of village
Chhapra. After taking average of these sale transactions, an addition of 25% was made
for fixing the market value of the land. Against the award made by the learned Additional
District Judge, the claimant-appellants (landowners) preferred 17 appeals before the High
Court. The High Court after appraisal of evidence on record held that the market value of
the land acquired was Rs.1,20,000/- per acre. It further held that the exemplars filed by
the appellants were of small pieces of land and, therefore, a deduction of 33% had to be
made and accordingly the market value of the land was assessed at Rs.80,000/- per acre.
Besides the market value, the appellants were also held entitled to statutory sums under
Sections 23(1-A), 23(2) and 28 of the Act. The State of Haryana had also filed appeals
against the award of the Additional District Judge, but the same were dismissed.
3. The appeals in this Court have only been filed by the landowners and the State of
Haryana has not filed any appeal challenging the judgment and decree of the High Court.
We have heard Shri M.L. Varma, learned Senior Advocate for the appellants and Shri
Rakesh Dwivedi, learned Senior Advocate for the Shahabad Cooperative Sugar Mills
Ltd., for whose benefit the land has been acquired.
4. In order to determine the compensation which the tenure-holders are entitled to get for
their land which has been acquired, the main question to be considered is what is the
market value of the land. Section 23(1) of the Act lays down what the Court has to take
into consideration while Section 24 lays down what the Court shall not take into
consideration and have to be neglected. The main object of the enquiry before the Court
is to determine the market value of the land acquired. The expression 'market value' has
been subject-matter of consideration by this Court in several cases. The market value is
the price that a willing purchaser would pay to a willing seller for the property having due
regard to its existing condition with all its existing advantages and its potential
possibilities when led out in most advantageous manner excluding any advantage due to
carrying out of the scheme for which the property is compulsorily acquired. In
considering market value disinclination of the vendor to part with his land and the urgent
necessity of the purchaser to buy should be disregarded. The guiding star would be the
conduct of hypothetical willing vendor who would offer the land and a purchaser in
normal human conduct would be willing to buy as a prudent man in normal market
conditions but not an anxious dealing at arms length nor facade of sale nor fictitious sale
brought about in quick succession or otherwise to inflate the market value. The
determination of market value is the prediction of an economic event viz., a price
outcome of hypothetical sale expressed in terms of probabilities. See Thakur Kanta
Prasad v. State of Bihar, AIR 1976 SC 2219; Prithvi Raj Taneja v. State of M. P., AIR
1977 SC 1560; Administrator General of West Bengal v. Collector, Varanasi, AIR 1988
SC 943 and Periyar v. State of Kerala, AIR 1990 SC 2192.
5. For ascertaining the market value of the land, the potentiality of the acquired land
should also be taken into consideration. Potentiality means capacity or possibility for
changing or developing into state of actuality. It is well settled that market value of a
property has to be determined having due regard to its existing condition with all its
existing advantages and its potential possibility when led out in its most advantageous
manner. The question whether a land has potential value or not, is primarily one of fact
depending upon its condition, situation, user to which it is put or is reasonably capable of
being put and proximity to residential, commercial or industrial areas or institutions. The
existing amenities like, water, electricity, possibility of their further extension, whether
near about Town is developing or has prospect of development have to be taken into
consideration. See Collector Raigarh v. Hari Singh Thakur, AIR 1979 SC 472, Raghubans
Narain v. State of U.P.,
@page-SC711
AIR 1969 SC 465 and Administrator General, W. B. v. Collector, Varanasi, AIR 1988 SC
943. It has been held in Kaushalya Devi v. L.A.O., Aurangabad, AIR 1984 SC 892 and
Suresh Kumar v. T.I. Trust, AIR 1980 SC 1222 that failing to consider potential value of
the acquired land is an error of principle.
6. As mentioned earlier, the learned Additional District Judge had awarded compensation
at a flat rate of Rs.43,000/- per acre by placing reliance on Ex. R-6 and R?7, two
instances of sale of village Chhapra. After taking an average of these two sale
transactions, an addition of 25% was made while fixing the market value of the land. The
High Court held that these two sale deeds were of 31.12.1980, while in the instant case,
the notification under Section 4 of the Act was published much later on 9.2.1983. That
apart, Ex.R-6 and R-7 were mutation orders and the corresponding sale deeds had not
been brought on the record. In fact, the learned Additional District Judge, in the earlier
part of the judgment, had himself discarded Ex. R-6 and R-7 as they were mutation
orders and were inadmissible in evidence. The High Court, therefore, rightly held that no
reliance could be placed upon Ex.R-6 and R-7 for determining the market value of the
land.
7. The claimant-appellants (landowners) had filed copies of four sale deeds which are
Exs.P-7, P-8, P-9 and P-10. In fact, Ex. P-7 is a copy of a sale deed by which Laxman
Singh bought some land in village Chhapra on 28.7.1982, which itself became subject-
matter of acquisition. Laxman Singh had deposed that he had bought the land for
construction of shops. All these four sale deeds related to sale transactions prior to the
issuance of the notification under Section 4 of the Act on 9.2.1983. The High Court
excluded Ex.P-8 from consideration as it related to a very small piece of land measuring
19 marlas only. The average price of the three sale deeds viz. Ex. P-7, P-9 and P-10 came
to little more than Rs.1,20,000/- per acre. Apart from these three sale deeds, no other
exemplars were filed either by the State of Haryana or by the landowners. The High
Court accepted the price exhibited by the aforesaid three sale transactions which came to
little more than Rs.1,20,000/- per acre. It thus recorded a finding that the market value of
the land was Rs.1,20,000/- per acre. In our opinion, there being no other documentary
evidence, the view taken by the High Court that the market value of the land was
Rs.1,20,000/- per acre is perfectly correct and calls for no interference.
8. Shri Rakesh Dwivedi, learned senior counsel for the sugar mill has submitted that the
exemplars filed by the appellants were of very small pieces of land and, therefore, they
are not safe guide to determine the market value of the land. It may be mentioned here
that while determining the market value, the potentiality of the land acquired has also to
be taken into consideration. The appellants have led evidence to show that the acquired
land had the potentiality to be used for commercial, industrial and residential purposes.
PW.1 Rakesh Kumar had prepared a site plan which showed that the acquired land was
adjacent to the abadi of Shahabad and abutted the Shahabad-Ladwa Road. The site plan
also shows that there existed rice shellers, cold storage, shops, godowns, a college and
houses etc. on both sides of Shahabad-Ladwa Road. PW.2 Baldev Singh was Patwari of
village Chhapra in the year 1983. He deposed that all the four villages viz. Kankar
Shahbad, Chhapra, Jandheri and Jhambara are adjacent to each other and the acquired
land abutted the Shahabad-Ladwa Road. He further deposed that the acquired land was 2
kilometer from G.T. Road and there were buildings, godowns, a cinema hall, factories on
both sides of the Shahabad-Ladwa Road. Therefore, there can be no manner of doubt that
the acquired land had the potentiality for being used for commercial, industrial and
residential purposes and there was fair possibility of increase in its market value in the
near future. Therefore, the fact that the exemplars filed by the appellants were of the
small pieces of land could not be a ground to discard them specially when exemplars of
large pieces of land were not available. They could, therefore, be used as a safe guide for
determining the market value of the land.
9

. Learned counsel for the appellants has seriously challenged the finding of the High
Court that the market value of the land determined on the basis of the exemplars filed by
the parties should be reduced by one-third on account of the fact that the exemplars relied
upon for ascertaining the market value related to sale of small pieces of land. According
to Shri M.L. Verma, learned senior counsel for the appellants, there is no uniform
principle that if a large area has 1992 AIR SCW 2791

@page-SC712
been acquired and the exemplars are of small pieces of land, the market value exhibited
by the exemplars must necessarily be reduced by one-third. Shri Verma has placed strong
reliance on Bhagwathula Samanna and Ors. v. Special Tehsildar and Land Acquisition
Officer, Visakha-patnam Municipality (1991) 4 SCC 506, wherein it was held as under :-
"In fixing the market value of a large property on the basis of a sale transaction for
smaller property, generally a deduction is given taking into consideration the expenses
required for development of the larger tract to make smaller plots within that area in order
to compare with the small plots dealt with under the sale transaction. However, in
applying this principle of deduction it is necessary to consider all relevant facts. It is not
the extent of the area covered under the acquisition which is the only relevant factor. If
smaller area within the large tract is already developed and situated in an advantageous
position suitable for building purposes and have all amenities such as roads, drainage,
electricity, communications etc. then the principle of deduction simply for the reason that
it is part of the large tract acquired, may not be justified.
In the present cases the lands covered by the acquisition are located by the side of the
National Highway and the Southern Railway Staff Quarters with the Town Planning Trust
road on the north. The neighbouring areas are already developed ones and houses have
been constructed, and the land has potential value for being used as building sites. Having
found that the land is to be valued only as building sites and having stated the
advantageous position in which the land in question lies though forming part of the larger
area, the High Court should not have applied the principles of deduction. It is not in every
case that such deduction is to be allowed. Therefore, the High Court erred in making a
deduction of one third of the value of the comparable sale and thus reducing the fair
market value of land from Rs. 10 per sq. yard to Rs.6.50 per sq. yard."

Shri Verma has also referred to Kasturi and Ors. v. State of Haryana (2003) 1 SCC 354,
wherein it was observed that in cases of those land where there are certain advantages by
virtue of the developed area around, it may help in reducing the percentage of cut to be
applied, as the development charges required may be less on that account. There may be
various factual factors which may have to be taken into consideration while applying the
cut in payment of compensation towards development charges, may be in some cases it is
more than 1/3rd and in some cases less than 1/3rd. Therefore, in this case taking into
consideration the potentiality of the acquired land for construction of residential and
commercial buildings, the deduction made was only 20%. 2002 AIR SCW 4644

10. Shri Rakesh Dwivedi, learned senior counsel for the sugar mill has, on the other hand,
strenuously urged that the evidence of market value shown by sale of small plots is not a
safe guide in valuing large areas of land and the prices fetched for small plots cannot be
directly adopted in valuing large extent of land as has been acquired in the present case.
He has thus contended that a deduction of 30% had rightly been made by the High Court
on account of acquisition of a large area. In support of his contention, Shri Dwivedi has
placed reliance upon several decisions of this Court. In order to appreciate the principle
laid down therein, it will be useful to refer to them in some detail. In Administrator
General of West Bengal v. Collector, Varanasi, AIR 1988 SC 943, it was held as follows
in para 6 of the report:-
"The principle requires that prices fetched for small developed plots cannot directly be
adopted in valuing large extents. However, if it is shown that the large extent to be valued
does admit of and is ripe for use for building purposes; that building lots that could be
laid out on the land would be good selling propositions and that valuation on the basis of
the method of a hypothetical layout could with justification be adopted, then in valuing
such small laid out sites the valuation indicated by sale of comparable small sites in the
area at or about the time of the notification would be relevant. In such a case, necessary
deductions for the extent of land required for the formation of roads and other civic
amenities; expenses of development of the sites by laying out roads, drains, sewers, water
and electricity lines, and the interest on the outlays for the period of deferment of the
realisation of the prices; the profits on the venture etc. are to be made."
@page-SC713
11. In Chimanlal v. Special Land Acquisition Officer, AIR 1988 SC 1652 it was held as
follows in para 4 (15) of the reports.
"Firstly while a smaller plot is within the reach of many, a large block of land will have to
be developed by preparing a lay out, carving out roads, leaving open space, plotting out
smaller plots, waiting for purchasers (meanwhile the invested money will be blocked up)
and the hazards of an entrepreneur. The factor can be discounted by making a deduction
by way of an allowance at an appropriate rate ranging approx, between 20% to 50% to
account for land required to be set apart for carving out lands and plotting out small plots.
The discounting will to some extent also depend on whether it is a rural area or urban
area, whether building activity is picking up, and whether waiting period during which
the capital of the entrepreneur would be locked up, will be longer or shorter and the
attendant hazards."
12

. Shri Dwivedi has also referred to Basant Kumar and Ors. v. Union of India and Ors.
(1996) 11 SCC 542, K. Vasundara Devi v. Revenue Divisional Officer (LAO) (1995) 5
SCC 426, H.P. Housing Board v. Bharat S. Negi and Ors. (2004) 2 SCC 184. In the first
cited case land was acquired for planned development of Delhi and in the other two cases
for Housing Boards and a deduction of 33% was applied. 1995 AIR SCW 3655
2004 AIR SCW 797

13. The reasons given for the principle that price fetched for small plots cannot form safe
basis for valuation of large tracts of land, according to cases referred to above, are that
substantial area is used for development of sites like laying out roads, drains, sewers,
water and electricity lines and other civic amenities. Expenses are also incurred in
providing these basic amenities. That apart it takes considerable period in carving out the
roads making sewers and drains and waiting for the purchasers. Meanwhile the invested
money is blocked up and the return on the investment flows after a considerable period of
time. In order to make up for the area of land which is used in providing civic amenities
and the waiting period during which the capital of the entrepreneur gets locked up a
deduction from 20% onward, depending upon the facts of each case, is made.
14. The question to be considered is whether in the present case those factors exist which
warrant a deduction by way of allowance from the price exhibited by the exemplars of
small plots which have been filed by the parties. The land has not been acquired for a
Housing Colony or Government Office or an Institution. The land has been acquired for
setting up a sugar factory. The factory would produce goods worth many crores in a year.
A sugar factory apart from producing sugar also produces many by-product in the same
process. One of the by-products is molasses, which is produced in huge quantity. Earlier,
it had no utility and its disposal used to be a big problem. But now molasses is used for
production of alcohol and ethanol which yield lot of revenue. Another by-product begasse
is now used for generation of power and press mud is utilized in manure. Therefore, the
profit from a sugar factory is substantial. Moreover, it is not confined to one year but will
accrue every year so long as the factory runs. A Housing Board does not run on business
lines. Once plots are carved out after acquisition of land and are sold to public, there is no
scope for earning any money in future. An industry established on acquired land, if run
efficiently, earns money or makes profit every year. The return from the land acquired for
the purpose of Housing Colony, or Offices, or Institution cannot even remotely be
compared with the land which has been acquired for the purpose of setting up a factory or
industry. After all the factory cannot be set up without land and if such land is giving
substantial return, there is no justification for making any deduction from the price
exhibited by the exemplars even if they are of small plots. It is possible that a part of the
acquired land might be used for construction of residential colony for the staff working in
the factory. Nevertheless where the remaining part of the acquired land is contributing to
production of goods yielding good profit, it would not be proper to make a deduction in
the price of land shown by the exemplars of small plots as the reasons for doing so
assigned in various decisions of this Court are not applicable in the case under
consideration.
15. Having regard to the entire facts and circumstances of the case, we are of the opinion
that a deduction of 10% from the market value of the land, which has been arrived at by
the High Court would meet the ends of justice. Therefore, the market value of the
acquired land for the purpose of payment of compensation to the land owners
@page-SC714
has to be assessed at Rs.1,08,000/- per acre.
16. In the result, the appeals are partly allowed. The claimant-appellants will be entitled
to compensation at the rate of Rs.1,08,000/- per acre. Besides the above amount, they will
also be entitled to the statutory sum in accordance with Section 23(1-A) and solatium at
the rate of 30% on the market value of the land in accordance with Section 23(2) of the
Act. They will also be entitled to interest as provided in Section 28 of the Act. The
appellants will be entitled to their costs.
Order accordingly.
AIR 2008 SUPREME COURT 714 "State of Chhattisgarh v. M/s. VTP Constructions"
(From : 2006(1) Cg. L. J. 308)
Coram : 2 Dr. A. PASAYAT AND AFTAB ALAM, JJ.
Civil Appeal No. 5679 of 2007 (arising out of SLP (C) No. 991 of 2007), D/- 7 -12
-2007.
State of Chhattisgarh and Ors.v. M/s. VTP Constructions.
M.P. Commercial Tax Act (5 of 1995), S.35 - Constitution of India, Art.245 -
LEGISLATIVE COMPETENCE - WORKS CONTRACT - INTER-STATE
TRADE/SALE - Works contract - Deduction at source of tax - S. 35 does not make any
provision for determination of value of goods supplied in course of inter-State trade
during execution of works contracts - Provision is beyond legislative competence of
State. (Para 10)
Cases Referred : Chronological Paras
2000 AIR SCW 708 : AIR 2000 SC 946 6, 7, 8, 10
2000 AIR SCW 958 : AIR 2000 SC 1268 6, 7, 8, 9, 10
(1996) 29 VKN 533 (MP) 5
AIR 1967 SC 1616 9
Rajesh Srivastava, for Appellants.
Judgement
1. Dr. ARIJIT PASAYAT, J. :-Leave granted.
2. Challenge in this appeal is to the judgment rendered by a Division Bench of the
Chhattisgarh High Court. Respondent filed a writ petition before the Chhattisgarh High
Court questioning constitutional validity of Section 35 of Chhattisgarh Vanijyik Kar
Adhiniyam, 1994 (hereinafter referred to as the 'Adhiniyam'). It corresponds to the
Chhattisgarh Commercial Tax Act, 1994 (in short the 'Act'). The respondent hereinafter is
described as the 'assessee'.
3. Background facts highlighted by the respondent are as follows:
The writ petitioner is a proprietary concern of one Shri Krishana Mudliar and it has been
executing works contracts for various Departments of the Chhattisgarh State Government
and others and was holding sales tax registration No.061/RDN/14, 2739/02. During the
assessment year 2001-2002, the writ petitioner had executed works contracts awarded by
Executive Engineer, P.W.D. (BandR), Division Khairagarh, for which it received payment
of Rs.1,27,115/- on which sales tax of Rs. - 2,545/-, being 2% of sum of Rs.1,27,115/-
was deducted at source towards the sales tax payable as provided under Section 35 of the
Adhiniyam. Certificate of tax deduction is dated 11/04/2001 made under Section 35 of
the Act.
4. In support of the writ petition, it was contended that Section 35 of the Act does not
make any provision for deduction and ascertainment of value and nature of goods
supplied during execution of work-contracts. Section 35 of the Act does not make any
provision for determination of value of goods supplied in the course of inter- State trade
during execution of works contracts.
5. The writ petition is opposed by the present appellants by filing reply/statement of
objections. In the reply statement, it was stated that the contractors who are engaged in
the construction of buildings, roads, bridges, dams etc. generally come from other States.
The process of assessment of sales tax is very lengthy and before the assessment is
completed, such contractors disappear from the scene after receiving full payment under
the contract. In such situation, it was very difficult for the Commercial Tax Department to
trace out such contractors and eventually sales tax payable by such contractors could not
be recovered at all thereby causing heavy financial loss to the Government. In order to
safeguard the interest of the State, Section 35 is enacted in the Act and that the State
Legislature has legislative competence to enact Section 35. It was stated that Section 35
is not a unique provision in the Act and similar provisions are enacted in the Sales Tax
Acts of other States, for example, Section 6-D of the Uttar Pradesh Trade Tax Act,
Section 6-E of the
@page-SC715
Bengal Finance (Sales Tax) Act, 1941; Section 25-A of the Bihar Finance Act, 1981;
Section 25-B of the Haryana General Sales Tax Act, 1973, Section 12-A of the Himachal
Pradesh General Sales Tax Act, 1968, Section 16-C of the Jammu and Kashmir General
Sales Tax Act, Section 19-A of the Karnataka Sales Tax Act and Section 13-AA of the
Orissa Sales Tax Act, 1947. It was also contended that the Constitutional validity of
Section 35 of the Adhiniyam was already considered and upheld by the Division Bench
of the Madhya Pradesh High Court in the case of Punj Lloyd Ltd. v. State of Madhya
Pradesh and Ors. (1996) 29 VKN 533.
6

. The High Court referred to decisions of this Court in Steel Authority of India Ltd. v.
State of Orissa and others [2000 (3) SCC 200) and M/s. Nathpa Jhakri Jt. Venture v. State
of Himachal Pradesh and Ors. [2000 (3) SCC 319] and declared the provision to be
unsustainable. 2000 AIR SCW 708
2000 AIR SCW 958

7. In support of the appeal learned counsel for the appellants submitted that the ambit and
scope of Section 35 of the Act were not kept in view by the High Court. The decision in
Steel Authority's case (supra) and Nathpa's case (supra) were dealing with different
provisions and, therefore, has no application to the facts of the case.
8

. Steel Authority's case (supra) related to Section 13AA of the Orissa Sales Tax Act, 1947
(hereinafter referred to as the 'Orissa Act'). In Nathpa Jhakri's case (supra) dispute related
to Section 12A of the Himachal Pradesh General Sales Tax Act, 1968 (in short the
'Himachal Pradesh Act'). While striking down Section 13AA of the Orissa Act, this Court
observed as follows in Steel Authority's case (supra) - : 2000 AIR SCW 708, (Para
13)
"There can be no doubt, upon a plain interpretation of Section 13AA, that it is enacted for
the purposes of deduction at source of the State sales tax that is payable by a contractor
on the value of a works contract. For the purpose of the deduction neither the owner nor
the Commissioner who issues to the contractor a certificate under Section 13AA(5) is
entitled to take into account the fact that the works contract involves transfer of property
in goods consequent upon of an inter-State sale, an outside sale or a sale in the course of
import. The owner is required by Section 13AA(1) to deposit towards the contractor's
liability to State sales tax four per cent of such amount as he credits or pays to the
contractor regardless of the fact that the value of the works contracts includes the value of
inter-State sales, outside sales or sales in the course of import. There is, in our view,
therefore, no doubt that the provisions of Section 13AA are beyond the powers of the
State Legislature for the State Legislature may make no law levying sales tax on inter-
State sales, outside sales or sales in the course of import."
9

. In Nathapa Jhakri's case (supra) this court held Section 12A of the Himachal Pradesh
Act to be unconstitutional and the relevant portion of the judgment reads as follows :
2000 AIR SCW 958, (Para 4)

"A bare perusal of the two provisions will make it clear that in either provision there is an
obligation to deduct from transactions relating to works contract on bills or invoices
raised by the works contractor an amount not exceeding 4 per cent or 2 per cent as the
case may be. Though the object of the provision is to meet the tax in respect of the
transactions on all works contract on the valuable consideration payable for the transfer
of property in goods involved in the execution of the works contract, the effect of the
provision is that, irrespective of whether the sales are inter-State sales or outside sales or
export sales which are outside the purview of the State Act and those transactions in
respect of which no tax can be levied even in terms of the enactment itself, such
deductions have to be made in the bills or invoices of the contractors. To say that if a
person is not liable for payment of tax inasmuch as on completion of the assessment
refund can be obtained at a later stage in no solace, as noticed in Bhawani Cotton Mills
Ltd. v. State of Punjab [(1967) 20 STC 290 (SC) : (1967) 3 SCR 577]. Further, there is no
provision for certification of the extent of the deduction that can be made by the
authority. Therefore, we must hold that arbitrary and uncanalised powers have been
conferred on the concerned person to deduct up to 4 per cent from the sum payable to the
works contract irrespective whether ultimately the transaction is liable for payment to any
sales tax at all. In that view of the matter, we have no hesitation in rejecting the
contention advanced on behalf of the State." AIR 1967 SC 1616

10. In view of what has been stated by this Court in Steel Authority's case and
@page-SC716
Nathpa's case (supra) the inevitable conclusion is that the High Court was right in holding
that Section 35 of the Act was constitutionally invalid. The direction for refund of the
amount collected from the respondent under the provisions of the said section had been
rightly directed to be refunded.
11. The appeal is sans merit and, therefore, deserves dismissal, which we direct. There
will be no order as to costs.
Appeal dismissed.
AIR 2008 SUPREME COURT 716 "Vinay Devanna Nayak v. Ryot Seva Sahakari Bank
Ltd."
(From : Karnataka)
Coram : 2 C. K. THAKKER AND MARKANDEY KATJU, JJ.
Criminal Appeal No. 1679 of 2007 (arising out of SLP (Cri.) No. 6908 of 2007), D/- 7
-12 -2007.
Vinay Devanna Nayak v. Ryot Seva Sahakari Bank Ltd.
Negotiable Instruments Act (26 of 1881), S.138, S.147 (as inserted by Negotiable
Instruments (Amendment and Miscellaneous Provisions) Act, 55 of 2002) - Criminal P.C.
(2 of 1974), S.320 - DISHONOUR OF CHEQUE - COMPOUNDING OF OFFENCE -
Dishonour of cheque - Compounding of offence - Technically provisions of S. 320, Cr. P.
C. do not apply to offences not covered by Indian Penal Code - However, considering
that object of S. 138 is to induce faith in efficacy of banking operations and credibility in
transacting business and also taking into account provision of S. 147, compounding of
offence should not normally be denied.
2000 AIR SCW 3483 (2000) 1 SCC 762; (2003) 9 SCC 214; (2004) 13 SCC 494; 2005
AIR SCW 3358; (2005) 10 SCC 632 and 1996 AIR SCW 840, Relied on.
Crl. R. P. No. 1003 of 2005, D/- 20-12-2005 (Kar.), Reversed. (Paras 15, 17, 18, 19)
Cases Referred : Chronological Paras
2005 AIR SCW 3358 : 2005 Cri LJ 4878 (Rel. on) 15
(2005) 10 SCC 632 (Rel. on) 15
(2004) 13 SCC 494 (Rel. on) 15
(2003) 9 SCC 214 (Rel. on) 15
2000 AIR SCW 3483 : AIR 2000 SC 3145 : 2000 Cri LJ 4673 (Rel. on) 14
(2000) 1 SCC 762 (Rel. on) 15
1996 AIR SCW 840 : AIR 1996 SC 2339 : 1996 Cri LJ 1692 (Rel. on) 17
S. Nanda Kumar, Ananda Selvam and V. N. Raghupathy, for Appellant; Ms. Renuga Devi
and P. Narashiman, for Respondent.
Judgement
1. C. K. THAKKER, J.:-Delay condoned. Leave granted.
2. The present appeal is filed against an order passed by the Court of Civil Judge (Jr.
Divn.) and Judicial Magistrate First Class, Ankola on April 12, 2004 in Criminal Case
No.73 of 2001, confirmed by the Sessions Judge, Fast Track Court-I, Karwar on March
24, 2005 in Criminal Appeal No. 50 of 2004 as also confirmed by the High Court of
Karnataka, Bangalore on December 20, 2005 in Criminal Revision Petition No.1003 of
2005.
3. Brief facts of the case are that the appellant herein was a member of Ryot Sewa
Sahakari Bank Ltd., Basgod, Taluka Ankola ('Complainant Bank' for short). He had
obtained a loan of Rs. 20,000/- from the Complainant-Bank on April 3, 1998 for business.
The amount was not paid by the appellant. The appellant issued a cheque of Rs. 24,000/-
on October 13, 2000 in favour of the Complainant-Bank and assured the Bank that it
would be honoured. But when the cheque was submitted for clearance, it was
dishonoured and returned to the drawer on December 22, 2000 with endorsement; "Loan
account due date is over and account is not in operation". The complainant, therefore,
issued a registered legal notice on December 26, 2000 which was duly served upon the
accused-loanee on December 30, 2000. In spite of the notice, no payment was made by
the accused and hence a criminal case was filed by the Bank against him under the
Negotiable Instruments Act, 1881 (hereinafter referred to as 'the Act'). A summons was
issued to the accused for an offence punishable under Section 138 of the Act. He pleaded
not guilty to the charge and claimed to be tried.
4. The Trial Court on the basis of evidence adduced by the complainant-Bank, held that
the accused had issued a cheque of Rs. 24,000/- which was dishonoured and even after
receipt of legal notice, he failed to pay the amount and thereby he had committed an
offence punishable under S. 138 of the Act. The Court, hence, convicted the accused and
ordered him to undergo imprisonment for a period of six months. The accused was also
ordered to pay a sum of Rs. 48,000/- as compensation within one month from the date of
the order. The Court
@page-SC717
ordered that out of the said amount of compensation, Rs. 43,000/- should be paid to the
complainant towards the compensation and Rs.5,000/- to be appropriated to the State. In
default of payment of compensation, the accused was ordered to undergo imprisonment
for a period of six months.
5. Being aggrieved by the order of conviction and sentence, the appellant preferred an
appeal. The Appellate Court confirmed the order of conviction and sentence recorded by
the Trial Court. It, however, reduced the amount of compensation from Rs. 43,000/- to
Rs. 30,000/- and fine from Rs. 5,000/- to Rs. 3,000/-. Order of default-sentence was
maintained.
6. The aggrieved accused invoked Revisional Jurisdiction of the High Court under
Section 401 read with Section 397 of the Code of Criminal Procedure, 1973. The High
Court on July 13, 2005, passed an interim order directing the accused to deposit the
compensation amount in the Court. But the accused failed to comply with the said order.
When the matter came up for hearing, the High Court, by the impugned order dated
December 20, 2005 dismissed the Revision Petition observing that there was no ground
to interfere with the order passed by the Trial Court and confirmed by the First Appellate
Court. It also observed that the petitioner-accused had not complied with the interim
order passed on July 13, 2005. Thus, there was no reason to admit the revision petition
and accordingly it was dismissed. The accused has challenged that order in this Court.
7. On November 12, 2007, the matter was placed for admission-hearing. It was stated by
the Learned Counsel for the appellant that the appellant intended to pay the amount.
Accordingly, notice was issued to the other side. Pursuant to the notice, the respondent-
Bank appeared and affidavit is filed by General Manager, Ryot Sewa Sahakari Bank
Limited, Basgod, wherein it was stated that the appellant had paid an amount of Rs.
45,000/- towards final settlement of the claim of the respondent-Bank on July 25, 2007
and the Bank had no other claim against the appellant and the matter has been settled
amicably.
8. We have heard the Learned Counsel for the parties. The Learned Counsel for the
appellant submitted that since the matter has been amicably settled between parties and
the amount of Rs. 45,000/- has been paid to the Bank towards 'full and final settlement'
and no further claim has remained, the compromise may be recorded, the appeal may be
allowed and appellant-accused may be ordered to be acquitted of the charge levelled and
conviction recorded against him by setting aside conviction as well as sentence.
9. The Learned Counsel for the respondent-bank admitted that there was a compromise
between the parties and an amount of Rs. 45,000/- had been accepted by the Bank
towards final settlement of the dues against the appellant and no further claim has been
put forward by the respondent-Bank.
10. In view of the fact that the matter has been settled and the amount of Rs. - 45,000/-
has been paid by the appellant and accepted by the Bank as 'full and final settlement' and
there are no further dues by the Bank, prima facie, there should be no objection to grant
the prayer of the accused and acquit him of the offence with which he was charged and
convicted by the Courts below.
11. It is no doubt true that every crime is considered to be an offence against the society
as a whole and not only against an individual even though an individual might have
suffered thereby. It is, therefore, the duty of the State to take appropriate action against
the offender. It is equally the duty of a Court of law administrating criminal justice to
punish a criminal. But there are offences and offences. Certain offences are very serious
in which compromise or settlement is not permissible. Some other offences, on the other
hand, are not so serious and the law may allow the parties to settle them by entering into
a compromise. The compounding of an offence signifies that the person against whom an
offence has been committed has received some gratification to an act as an inducement
for his abstaining from proceeding further with the case.
12. So far as the Code of Criminal Procedure is concerned Section 320 deals with
offences which are compoundable, either by the parties without the leave of the Court or
by the parties but only with the leave of the Court. Sub-section (1) of Section 320
enumerates the offences which are compoundable without the leave of the Court, while
sub-section (2) of the said section specifies the offences which are compoundable with
@page-SC718
the leave of the Court. Sub-section (9) of Section 320 declares; "No offence shall be
compounded except as provided by this section". It is thus clear that offences not referred
to in sub-sections (1) and (2) of Section 320 and not included in the Table are not
compoundable. Similarly, offences punishable under laws other than the Indian Penal
Code also cannot be compounded.
13. In the circumstances, a question may arise whether an offence punishable under
Section 138 of the Act which is a special law can be compounded. Whereas some High
Courts held that if the matter is settled between the parties, the offence can be
compounded, other High Courts took a contrary view.
14

. In Cranex Ltd. and Anr. v. Nagarjuna Finance Ltd. and Anr., (2000) 7 SCC 388, a
settlement had been entered between the parties during the pendency of appeal in
Sessions Court against an order of conviction and sentence recorded by the Magistrate
under section 138 of the Act. This Court directed the Appellate Court to consider the
settlement and to take appropriate action in accordance with law. 2000 AIR SCW 3483

15
. In O.P. Dholkia v. State of Haryana and Anr., (2000) 1 SCC 762, an order of conviction
recorded by the Trial Court was upheld by the Appellate as well as Revisional Court.
Thereafter, however, a compromise had been arrived at between the parties and the entire
amount was paid to the complainant. It was, therefore, submitted before this Court that
the accused may be acquitted. The Learned Counsel appearing for the State urged that
when the conviction and sentence had been maintained by all Courts, this Court need not
show any indulgence. Though the Court observed that there was 'some force' in the said
contention, taking into account the nature of offence and the fact that the complainant had
compromised the matter, permission was granted 'in the peculiar facts and circumstances'
of the case [see also Nambiram Veetil Pocker v. State of Kerala and Anr., (2003) 9 SCC
214]. It is thus clear that even though technically the provisions of Section 320 of the
Code of Criminal Procedure did not apply to offences not covered by the Indian Penal
Code, the fact as to compromise between the parties and payment of dues under Section
138 of the Act was considered a relevant fact and compounding was allowed by the Court
[vide Kishore Kumar v. J.K. Corporation Ltd., (2004) 13 SCC 494; Shailesh Shyam
Parsekar v. Baban @ Vishwanath, (2005) 4 SCC 162; K.J.B.L. Rama Reddy v.
Annapurna Seeds and Anr., (2005) 10 SCC 632]. 2005 AIR SCW 3358

16. Section 138 of the Act was inserted by the Banking, Public Financial Institutions and
Negotiable Instrument Law (Amendment) Act, 1988 (Act 66 of 1988) to regulate
financial promises in growing business, trade, commerce and industrial activities of the
country and the strict liability to promote greater vigilance in financial matters. The
incorporation of the provision is designed to safeguard the faith of the creditor in the
drawer of the cheque, which is essential to the economic life of a developing country like
India. The provision has been introduced with a view to curb cases of issuing cheques
indiscriminately by making stringent provisions and safeguarding interest of creditors.
17

. As observed by this Court in Electronic Trade and Technology Development


Corporation Ltd. v. Indian Technologists and Engineers, (1996) 2 SCC 739, the object of
bringing Section 138 in the statute book is to inculcate faith in the efficacy of banking
operations and credibility in transacting business on negotiable instruments. The
provision is intended to prevent dishonesty on the part of the drawer of negotiable
instruments in issuing cheques without sufficient funds or with a view to inducing the
payee or holder in due course to act upon it. It thus seeks to promote the efficacy of
banking operations and ensures credibility in transacting business through cheques. In
such matters, therefore, normally compounding of offences should not be denied.
Presumably, Parliament also realized this aspect and inserted Section 147 by the
Negotiable Instruments (Amendment and Miscellaneous Provisions) Act, 2002 (Act 55 of
2002). The said section reads thus: 1996 AIR SCW 840

S.147. Offences to be compoundable.- Notwithstanding anything contained in the Code


of Criminal Procedure, 1973 (2 of 1974), every offence punishable under this Act shall be
compoundable.
18. Taking into consideration even the said provision (Section 147) and the primary
object underlying Section 138, in our judgment, there is no reason to refuse compromise
between the parties. We, therefore,
@page-SC719
dispose of the appeal on the basis of the settlement arrived at between the appellant and
the respondent.
19. For the foregoing reasons the appeal deserves to be allowed and is accordingly
allowed by holding that since the matter has been compromised between the parties and
the amount of Rs. 45,000/- has been paid by the appellant towards full and final
settlement to the respondent-Bank towards its dues, the appellant is entitled to acquittal.
The order of conviction and sentence recorded by all courts is set aside and he is
acquitted of the charge levelled against him.
20. Ordered accordingly.
Appeal allowed.
AIR 2008 SUPREME COURT 719 "S. Bagirathi Ammal v. Palani Roman Catholic
Mission"
(From : 2001 AIHC 3826 (Mad.))
Coram : 3 B. N. AGRAWAL, PRAKASH PRABHAKAR NAOLEKAR AND P.
SATHASIVAM, JJ.
Civil Appeal Nos. 78-79 of 2002, D/- 6 -12 -2007
S. Bagirathi Ammal v. Palani Roman Catholic Mission.
(A) Madras City Tenants Protection Act (3 of 1922), S.1(3)(f) (as amended by Act 2 of
1996) - TENANCY - APPLICABILITY OF AN ACT - RELIGIOUS AND
CHARITABLE ENDOWMENTS - WORDS AND PHRASES - Applicability - Religious
institution - Palani Roman Catholic Mission - Is "religious institution" within meaning of
S. 1(3)(f) - Proceedings instituted against it - Would abate. (Paras 6, 10)
(B) Madras City Tenants Protection Act (3 of 1922), S.1(3)(f) (as amended by Act 2 of
1996) - ABATEMENT - EVICTION - AMENDMENT - SALE DEED - Eviction
proceedings - Tenant exercising option of purchasing sites from landlord - Landlord
falling in category of "religious institution" after enactment of Amendment Act - Thus
proceedings for purchase of property instituted by tenant would abate - Therefore,
execution of sale deed by court in favour of tenant much after enforcement of
Amendment Act - Would be nullity.
AIR 2006 (NOC) 965 : 2006 (5) Mad LJ 281 (FB), Overruled. (Paras 10, 11, 12)
(C) Civil P.C. (5 of 1908), O.47, R.1 - REVIEW - TENANCY - AMENDMENT - HIGH
COURT - Review - Apparent error - Proceedings for purchase of tenanted property by
tenant - Pendency - Benefits conferred by Amendment Act on landlord, religious
institutions during pendency of Proceedings - Order not giving benefits - Held, granting
benefits by High Court under amended Act by allowing review applications, was proper.
(Para 12)
Cases Referred : Chronological Paras
AIR 2006 (NOC) 965 : 2006 (2) Mad LJ 281 (FB) (Overruled) 11
2005 AIR SCW 6170 : AIR 2006 SC 523 (Ref.) 9
2000 AIR SCW 2608 : AIR 2000 SC 2587 (Ref.) 2
(2000) 3 Mad LJ 616 (FB) 9
M. N. Krishnamani, Sr. Advocate, B. Sri-dhar, Ms. I. Madhavi and K. Ram Kumar, for
Appellant; P. - P. Rao, Sr. Advocate, V. J. Francis, Anupam Mishra, Ms. Jessy Kurien, D.
S. Chadha, Purushottam T. S., Abhishek Gupta and Ms. Sahar Bakht, for Respondent.
Judgement

P. SATHASIVAM, J. :- Challenging the order dated 20.7.2001 passed by the High Court
of Judicature at Madras in Review Application Nos. 8 and 9 of 1997 filed by the
respondent herein whereby a learned single Judge of the High Court allowed the same,
the appellant has filed these appeals. reported in 2001 AIHC 3826

. The respondent herein was the owner of the suit vacant land in question. In 1959, the
suit land was leased out for five years by the respondent to the appellant herein. On
3.3.1965, the tenancy was renewed for another period of three years. After the expiry of
three years, the respondent wanted the appellant to vacate the premises. As the appellant
did not vacate, the respondent issued a notice on 28.8.1968 demanding possession for
which he sent a reply with false and frivolous allegations. In the year 1969, the
respondent filed O.S.No.218 of 1969 for recovery of land. The appellant also filed
O.S.No. 75 of 1970 as a counter-blast for getting a fresh lease document from the
respondent. On 14.12.1970, O.S.No. 218 of 1969 was compromised and O.S.No. 75 of
1970 was dismissed as not pressed. The appellant did not vacate the suit property in spite
of repeated demands by the respondent, therefore, the respondent filed a fresh Suit i.e.
O.S.No. 76 of 1977 for delivery of possession. On 27.7.1978, O.S. No.76 of 1977 was
decreed in favour of the respondent while O.P. No. 4 of 1977 filed by the appellant for
purchase of the land by her was erroneously dismissed and an order of eviction was
passed against the appellant 2000 AIR SCW 2608

@page-SC720
by the Court of District Munsif, Palani. The Madras City Tenants Protection Act, 1921
gives the option of purchasing the site from the landlord by the tenant in case a suit for
eviction is filed by the landlord where the tenant is the owner of the superstructure
standing thereon and if the tenant is not interested in buying the site then the landlord can
buy the superstructure or ask the tenant to remove the superstructure and seek delivery of
possession. The said Act was extended to the town of Palani in Tamil Nadu only in 1975,
therefore, the option of buying the site from the respondent became available to the
appellant as the owner of the superstructure. The appellant filed an application O.P. No. 4
of 1977 in Suit No. 76 of 1977 for purchase of land by him which was dismissed. Against
the said order, the appellant filed A.S.No. 121 of 1978 and another A.A.O. No. 94 of
1978 against the order in O.P. No. 4 of 1977. The appellate Court allowed the appeals of
the appellant directing the respondent to sell the land to the appellant for an amount of
Rs. 65,092.50. Aggrieved by the said order, the respondent filed S.A.No. 2149 of 1981
and C.R.P. No. 2204 of 1980 against the order allowing the petition of the appellant for
purchase of the suit property. The second appeal and the revision petition filed by the
respondent were dismissed by a learned single Judge of the High Court of Madras.
Against that order, the respondent filed S.L.P.(C) Nos. 5029 and 5030 of 1984 before this
Court which were dismissed. After the stay order operating from 1980 to 1985
continuously ceased to operate, the appellant deposited the full site value. With the
dismissal of the S.L.Ps. by this Court and the deposit of the full site value by the
appellant, the same became final. In the year 1985, the appellant filed an execution
petition being E.P. No. 257 of 1985 for execution of the sale deed of the land in his
favour by the respondent. On the other hand, the respondent filed an execution petition
being E.P. No. 79 of 1983 for executing the compromise decree in O.S.No.218 of 1969.
Both the petitions were taken up together for disposal. The Executing Court allowed E.P.
No. 257 of 1985 filed by the appellant for execution of the sale deed and dismissed E.P.
No. 79 of 1983 filed by the respondent. Dissatisfied therewith, the respondent filed C.R.P.
No. 1445 of 1988 against the order in E.P. No. 79 of 1983 and A.A.O. No. 767 of 1989
against the order in E.P. No. 257 of 1985. Both the petitions were heard together and the
same were dismissed by the High Court upholding the directions of the Execution Court
to execute the sale deed in favour of the appellant. On 28.10.1996, the sale deed in favour
of the appellant was executed by the Court of District Munsif, Palani. The sale deed was
registered as Document No. 1908 of 1996 in the Registrar's office. Against the order in
C.R.P. No. 1445 of 1988 and A.A. O. No. 767 of 1989, the respondent filed S.L.P.(C)
Nos. 22925 and 22926 of 1996 before this Court which were dismissed. After every thing
became final with the execution and registration of the sale deed in favour of the
appellant and the dismissal of the S.L.Ps. by this Court, the respondent filed review
applications being Review Application Nos. 8 and 9 of 1997 in the High Court against the
order dated 26.7.1997 passed by the High Court on the same grounds as were in S.L.Ps.
and the same were dismissed on the ground that they were not maintainable after the
dismissal of the S.L.Ps. by this Court. On 7.2.1997, the appellant filed an application
E.A.No. 820 of 1996 for return of the duly registered sale deed and the same was
allowed. The respondent was not a party to the said E.A. and he did not make any effort
to implead himself. Against the said order, the Registrar who was a party filed C.R.P. No.
1819 of 1997. In the said C.R.P., the respondent filed an application being C.M.P. No.
3005 of 1998 to implead himself which was dismissed by the High Court. The C.R.P.
filed by the Registrar was dismissed and the Registrar returned the sale deed to the
executing Court. Against the order dated 16.12.1998 in the R.A.Nos. 8 and 9 of 1997, the
respondent filed S.L.P.(C) Nos. 6097 and 6098 of 1999 before this Court. On 2.2.2001,
this Court passed an order of remand of the review applications in S.L.P.(C) Nos. 6097-
6098 of 1999 because of the decision of this Court in Kunhyammed v. State of Kerala,
(2000) 6 SCC 359, holding that the summary dismissal of a special leave petition does
not bar a review petition permissible under the law. The respondent filed an application in
the review applications for producing additional documents which was allowed by a
learned single Judge of the High Court. As a result of the order of the High Court, the
proceedings for return of the registered sale deed to the appellant was dismissed by the
executing Court. Aggrieved by the said order, these appeals have been preferred by the
appellant.
@page-SC721
3. Heard Mr. M.N. Krishnamani, learned senior counsel appearing for the appellant and
Mr. P. P. Rao, learned senior counsel appearing for the respondent.
4. The only point for consideration in these appeals is whether the High Court is justified
in allowing Review Application Nos. 8 and 9 of 1997 under Order XLVII, Rule 1, C.P.C.
5. Since we have already narrated the case of both the parties in the paragraphs supra,
there is no need to traverse the same once again. Before considering the rival claims
made by both the parties, it is useful to refer the provisions under Order XLVII, Rule 1,
C.P.C. relating to Review which read as under:
"1. Application for review of judgment:- (1) Any person considering himself aggrieved-
(a) by a decree or order from which an appeal is allowed, but from which no appeal has
been preferred,
(b) by a decree or order from which no appeal is allowed, or
(c) by a decision on a reference from a Court of Small Causes,
and who, from the discovery of new and important matter or evidence which, after the
exercise of due diligence was not within his knowledge or could not be produced by him
at the time when the decree was passed or order made, or on account of some mistake or
error apparent on the face of the record, or for any other sufficient reason, desires to
obtain a review of the decree passed or order made against him, may apply for a review
of judgment to the Court which passed the decree or made the order.
(2) A party who is not appealing from a decree or order may apply for a review of
judgment notwithstanding the pendency of an appeal by some other party except where
the ground of such appeal is common to the applicant and the appellant, or when, being
respondent, he can present to the Appellate Court the case on which he applies for the
review.
[Explanation- The fact that the decision on a question of law on which the judgment of
the Court is based has been reversed or modified by the subsequent decision of a superior
Court in any other case, shall not be a ground for the review of such judgment.]"
A reading of the above provision makes it clear that Review is permissible (a) from the
discovery of new and important matter or evidence which, after the exercise of due
diligence could not be produced by the party at the time when the decree was passed; (b)
on account of some mistake; (c) where error is apparent on the face of the record or is a
palpable wrong; (d) any other sufficient reason. If any of the conditions satisfy, the party
may apply for a review of the judgment or order of the Court which passed the decree or
order. The provision also makes it clear that an application for Review would be
maintainable not only upon discovery of a new and important piece of evidence or when
there exists an error apparent on the face of the record but also if the same is necessitated
on account of some mistake or for any other sufficient reason. An error contemplated
under the Rule must be such which is apparent on the face of the record and not an error
which has to be fished out and searched. In other words, it must be an error of
inadvertence. It should be something more than a mere error and it must be one which
must be manifest on the face of the record. When does an error cease to be mere error and
becomes an error apparent on the face of the record depends upon the materials placed
before the Court. If the error is so apparent that without further investigation or enquiry,
only one conclusion can be drawn in favour of the appellant, in such circumstances, the
review will lie. Under the guise of review, the parties are not entitled to re-hearing of the
same issue but the issue can be decided just by a perusal of the records and if it is
manifest can be set at right by reviewing the order. With this background, let us analyze
the impugned judgment of the High Court and find out whether it satisfy any of the tests
formulated above.
6. It is the claim of the respondent herein that it is a Roman Catholic Mission and is a
religious institution within the meaning of Amended provisions of The Tamil Nadu City
Tenants Protection Act, 1921 (hereinafter referred to as "the Principal Act). The "Roman
Catholic Mission" (hereinafter "Mission" in short), in support of the above claim, filed
several documents, namely, Ex. A-1 to A-15 and also let in evidence of PW-1 and PW-2
who were conversant with their activities. The High Court, on appreciation of those
materials, arrived at a factual conclusion that the same came under the Roman
@page-SC722
Catholic Diocese which has as its object and maintenance of churches and hence it is a
"religious institution". Though it was contended by the learned senior counsel appearing
for the appellant herein that only certificate of registration was produced by the Mission
to substantiate its case that it is a religious institution, in view of the categorical factual
finding by the High Court based on acceptable oral and documentary evidence, we reject
the said objection. It is relevant to point out that when the above appeals were heard on
19.01.2006 at length, this Court after finding that it would be just and expedient to call
for a finding from the trial Court as to whether the Palani Roman Catholic Mission is a
'religious institution' or 'institution of religious charity' belonging to Hindu, Muslim,
Christian or other religion within the meaning of Section 1(3)(f) of the Madras City
Tenants Protection Act, 1921, as amended by Act 2 of 1996, directed the trial Court to
record a finding on the said question after giving opportunity of adducing oral and
documentary evidence to the parties and thereupon remit its finding to this Court within a
period of six months from the date of receipt of copy of the said order. Pursuant to the
said direction, this Court received a report dated 09.08.1996 from the trial Court i.e.
District Munsiff, Palani and the same was handed over to learned counsel appearing on
behalf of the parties. They were given an opportunity to peruse the report and submit
their objection, if any. The report shows that the learned District Munsiff, after affording
opportunity to both parties and after recording evidence and relying on documents placed
by both parties, arrived at the following conclusion:-
"......... ... Thus, on cumulative appraisal of the evidence on record in the context of the
undisputed averments of the proof-affidavit of the P.W.1 and P.W.2 in particular P.W.2
with regard to the factum of conducting the religious ceremonies, prayers and masses in
the plaintiff-Mission, this Court feels that an inescapable and irresistible conclusion can
be drawn that the plaintiff-mission is a place of worship for the people who have faith in
the Christianity, particularly believers attached with the Roman Catholic denomination.
Therefore, in view of the finding as above, this Court hold that the Palani Roman
Catholic Mission is a religious institution in the context of the Section 1(f) of the Madras
City Tenants Protection Act, 1921 as amended by Act 2 of 1996.
In the result, on the basis of the evidence emerged on record, I hold that the Palani
Roman Catholic Mission is a religious institution within the meaning of Section 1(f) of
the Madras City Tenants Protection Act, 1921 as amended by the Act 2 of 1996."
In view of the conclusion of the High Court as well as the report of the trial Court holding
that Palani Roman Catholic Mission-respondent herein is a religious institution within the
meaning of Section 1 (f) of the principal Act as amended by Madras City Tenants
Protection Act as amended by Act 2 of 1996. We agree with the said conclusion.
7. Now we will consider the provisions of the Principal Act as well the provisions of the
Amendment Act i.e., the Madras City Tenants Protection (Amendment) Act, 1994 (Tamil
Nadu Act 2 of 1996) [hereinafter referred to as "the amended Act"]. The Statement of
Objects and Reasons of the Act shows that in many parts of the City of Madras (and other
Municipal towns) dwelling houses and other buildings have from time to time been
erected by tenants on lands belonging to others, in the expectation that subject to payment
of a fair ground rent they would be left in their undisturbed possession, in spite of any
agreement about duration of the tenancy and the terms on which the buildings were to be
leased. Attempts made or steps taken to evict a large number of such tenants had shown
that such expectations are likely to be defeated. The tenants, if they were evicted, can
remove the superstructure which can only be done by pulling down the building, or claim
compensation for the value of the building put up by them and the value of any tree
planted by them. As a result of such wholesale destruction, congested parts of the city
(municipal towns) would become more congested to the serious detriment of public
health. In the circumstances, it was though just and reasonable that the landlords when
they evict the tenants should pay for and take the buildings. There may however be cases
where the landlord is unwilling to eject a tenant, if he can get a fair rent for the land. The
Act provides for the payment of compensation to the tenant in case of ejectment for the
value of any buildings which may have been erected by him, or his predecessor-in-
interest. It also provides for the settlement of fair rent at the instance of the
@page-SC723
landlord, or tenant. Provision is also made to enable the tenant to purchase the land in his
occupation, subject to certain conditions.
8. Section 9 gives the right to the tenant, who has put up a superstructure to purchase
such part or extent of the land, be reasonably required for his enjoyment. Since we are
concerned about the Amended Act, there is no need to go into other provisions. The
Amended Act received the assent of the President on 5.1.1996 and published in the Tamil
Nadu Government Gazette Extraordinary Part IV, Section 2 dated 11.1.1996. By
Amendment Act, the Tamil Nadu legislature has amended Section 1 of the principal Act
and added certain provisions in sub-section (3). The amended provisions are as follows:
"Amendment of Section 1 - In Section 1 of the Madras City Tenants' Protection Act, 1921
(Tamil Nadu Act III of 1922), (hereinafter referred to as the principal Act), in sub-section
(3), in the first proviso; after clause (e), the following clause shall be added, namely:-
(f) by any religious institution or religious charity belonging to Hindu, Muslim, Christian
or other religion.
Explanation:- for the purpose of this clause-
(A) "religious institution" means any-
(i) temple
(ii) math;
(iii) mosque
(iv) church; or
(v) other place by whatever name known
which is dedicated to, or for the benefit of, or used as of right by, any community or
section thereof as a place of public religious worship;
(B) "religious charity" means a public charity associated with a religious festival or
observance of religious character (including a wakf associated with a religious festival or
observance of religious character), whether it be connected with any religious institution
or not."
3. Certain pending proceedings to abate- Every proceeding instituted by a tenant in
respect of any land owned by any religious charity belonging to Hindu, Muslim,
Christian or other religion and pending before any Court or other authority or officer on
the date of the publication of this Act in the Tamil Nadu Government Gazette, shall in so
far as the proceeding relates to any matter falling within the scope of the principal Act, as
amended by this Act, in respect of such land, abate and all rights and privileges which
may have accrued to that tenant in respect of any such land and subsisting immediately
before the said date shall in so far as such rights and privileges relate to any matter falling
within the scope of the principal Act, as amended by this Act, cease and determine and
shall not be enforceable:
Provided that nothing contained in this section shall be deemed to invalidate any suit or
proceeding in which a decree or order passed has been executed or satisfied in full before
the said date."
We have already mentioned that the amendment was published in the Gazette on
11.1.1996 and as per sub-section (2) of Section 1, it came into force on the date of
publication. In other words, from 11.1.1996 benefits conferred on the tenants under
Section 9 of the Principal Act have been deleted in respect of the lands belonging to
religious institution or religious charity of Hindu, Muslim, Christian or other religion. We
have already referred to the finding of the High Court holding that the respondent herein
is a Roman Catholic Mission which is a "religious institution" within the meaning of the
amended provision. The Amended Act has given the respondent herein a valuable right of
exemption from the provisions of the Principal Act.
9

. It is relevant to mention here that the Amendment Act No. 2 of 1996 has been upheld by
the Full Bench of the High Court in N. Sreedharan Nair vs. State of Tamil Nadu, (2000) 3
MLJ 616, and the said decision of the Full Bench has also been approved by this Court by
dismissing C.A.Nos. 4531 of 2003 etc.etc. titled Mylapore Club vs. State of T.N. and Anr.
2005 (5) CTC 494, filed against the same. 2005 AIR SCW 6170

10. Both before the High Court as well as before this Court, it was contended that in view
of the orders/decisions of various Courts including this Court, the issue cannot be agitated
once again by way of review application; hence, the impugned order of the High Court is
to be set aside. Mr. P.P. Rao, learned senior counsel appearing for the respondent, has
brought to our notice that in the earlier proceedings, this Court in Civil Appeal Nos.
1055-1056 of 2001 directed the High Court to consider the
@page-SC724
review applications afresh. In other words, by virtue of the said order, the High Court was
directed to decide the review applications on merits. In such circumstances, the High
Court was fully justified in analyzing the issue as directed by this Court and its ultimate
decision that Roman Catholic Mission is a "religious institution" cannot be faulted with
since it relied on acceptable materials in the form of oral and documentary evidence (vide
Ex. A-1 to A-15 and evidence of PW-1, PW-2). It was demonstrated that these religious
and charitable institutions were not only deprived of their legitimate income but also their
valuable properties. It was also their claim that because of the provision, namely, Section
9 of the Act, the tenants flourished and the landlord-institutions were crippled. It was
further pointed out that in those circumstances Act No. 2 of 1996 was enacted in order to
protect those religious institutions. We have already concluded that pleadings of the
respondent herein-review petitioners and various orders/judgments show that it is a
"religious institution". As rightly observed by the High Court, the claim that the
"Mission" is a "religious institution" is apparent from the materials without any further
investigation. In such circumstances, as per Section 1(f) of the amended Act, all
proceedings instituted by a tenant would abate. The amended Act came into force from
11.1.1996 and on the question whether on the date of coming into force of the amended
Act, giving certain benefits to the religious institutions and taking away the right of the
tenant under Section 9, the High Court concluded as under:
"........The Transfer C.M.A. which was a continuation of the application under Section 9
of the Tamil Nadu City Tenants Protection Act filed by the respondent who is the tenant
was still pending. The proceedings had not attained finality. Therefore, they terminated
and they became unenforceable. On the date when the first appeal and the C.M.A. were
disposed of, tenancy granted by religious institutions were still governed by the
provisions of the Act. Now, by the introduction of Act 2 of 1996, they cease to apply,
ergo, all proceedings instituted by the tenant shall abate. All rights and privileges that
may have accrued to her cease. They come to an end and they shall not be enforceable.
The jurisdiction of the Court to decide the tenant's claim ceased."
It is clear that on the date when the amended Act came into force, the application under
Section 9 of the principal Act filed by the tenant-appellant herein was still pending.
Though Mr. M.N. Krishnamani, learned senior counsel appearing for the appellant,
submitted that all formalities were completed before coming into force of the amended
Act, as pointed out earlier, pursuant to the order of the High Court, the sale deed was
executed only on 28.10.1996 whereas the amended Act (Act No.2 of 1996) came into
force on 11.1.1996 much earlier to the execution of the sale deed, hence, the contention
of learned senior counsel for the appellant is not acceptable and we are in agreement with
the conclusion arrived at by the High Court. As rightly concluded by the High Court, the
decree in O.P. No. 4 of 1977 became a nullity on and from 11.1.1996, the executing Court
committed an error in executing the sale deed after coming into force of amended Act.
Further as rightly observed by the High Court, unless the sale deed is executed either by
the Mission or by the Court, the fruits of the decree will not be realized by the tenants and
the proceedings will come to an end only upon execution of the sale deed. Therefore, the
tenant cannot be heard to say that the proviso applies to him and that the proceedings are
not invalidated. The High Court is right in holding that the decree not having been
executed by means of a sale deed, the proceedings are deemed to be pending and,
therefore, were determined with the coming into force of the amendment Act.
11

. Finally, Mr. M.N.Krishnamani placing reliance on the Full Bench decision of the
Madras High Court rendered in CRP(NPD) 2758 of 1996 titled Arulmigu Kasi
Viswanathaswamy Devasthanam v. Kasthuriammal, submitted that the moment tenant
deposited the amount the order is fully satisfied. He further pointed out that as per the
said decision the moment the order under Section 9 (3) (a) is passed, it shall be construed
that the proceedings got terminated and the suit stood dismissed as per Section 9 (3) (b)
of the Act. We are unable to accept the said proposition. The relevant provisions are as
follows:- reported in AIR 2006 (NOC) 965 (Mad)

"9. (3) (a) On payment of the price fixed under clause (b) of sub-section (1) the Court
shall pass an order directing the conveyance by the landlord to the tenant of the extent of
land for which the said price was fixed.
@page-SC725
The Court shall by the same order direct the tenant to put the landlord into possession of
the remaining extent of the land, if any, the stamp duty and registration fee in respect of
such conveyance shall be borne by the tenant.
(b) On the order referred to in clause (a) being made, the suit or proceeding shall stand
dismissed, and any decree or order in ejectment that may have been passed therein but
which has not been executed shall be vacated."
It is clear that if the tenant complies with the order passed under Section 9 (1) (b) and
deposits the amount within the time as fixed, the Court has to pass an order directing the
conveyance by the landlord to the tenant. It is true that as per Section 9 (3) (b) on passing
an order under clause (a) the suit or proceeding shall stand dismissed. In the light of the
language used in clause (a) i.e. "conveyance" to be made by the landlord to the tenant, till
the proper document conveying title to the tenant it is presumed that the proceeding is
kept pending. To put it clear that unless the sale deed is executed by the landlord in
favour of the tenant or in the alternative by the Court on behalf of the landlord the fruits
of the decree cannot be realized. The suit or proceeding will come to an end immediately
on execution of sale deed either by the landlord or by the Court on behalf of the landlord.
In our case, as said earlier, the sale deed was executed only on 28.10.1996, however, the
amended Act 2/96 came into force on 11.01.1996 much earlier to the execution of sale
deed. The view expressed in the Full Bench decision runs counter to the language used in
the statute and we are unable to accept the same.
12. From the materials, we are satisfied that the conclusion reached by the High Court
holding that the review petitioner/respondent herein is a "religious Mission"/ "institution"
within the meaning of amended provision and entitled to the benefits of amended Act.
Further if the same is not applied to the Mission, it would result in miscarriage of justice
and it had been rightly rectified by the High Court by the impugned judgment. The
benefit that has been bestowed upon the religious institution by the Legislature cannot be
ignored lightly merely because the issue was decided by way of review applications.
Inasmuch as at the relevant point of time, the Amended Act 2 of 1996 was not enacted
and not available for consideration before the Court and also of the fact that the
proceeding instituted by the tenant/appellant herein was pending and not reached finality
on the date of coming into force of the amended Act, we are satisfied that the High Court
is justified in granting the relief as provided under the amended Act (Act No.2 of 1996)
by allowing the review applications. As held earlier, if the judgment/order is vitiated by
an apparent error or it is a palpable wrong and if the error is self evident, review is
permissible and in this case the High Court has rightly applied the said principles as
provided under Order 47 Rule 1 C.P.C. In view of the same, we are unable to accept the
arguments of learned senior counsel appearing for the appellant, on the other hand, we
are in entire agreement with the view expressed by the High Court.
13. In the light of the above discussion and conclusion, the appeals fail and are
accordingly dismissed. No costs.
Appeals dismissed.
AIR 2008 SUPREME COURT 725 "Modi Tele Fibres Ltd. v. U. P. State Electricity
Board"
(From : Allahabad)
Coram : 2 R. V. RAVEENDRAN AND P. SATHASIVAM, JJ.
Civil Appeal No. 5976 of 2001, D/- 6 -12 -2007.
Modi Tele Fibres Ltd. v. U. P. State Electricity Board and Ors.
Electricity Act (9 of 1910), S.24 - ELECTRICITY - CONSTITUTIONALITY OF AN
ACT - Electricity bill - Demand for - Validity - Appellant Company having service
connection - Due to financial crunch it requested Board to provide electric supply directly
to residential colonies - Neither specific request was made for disconnection of service
connection nor requisite charges were paid for separate domestic connection - Board
continued to supply electricity through service connection - Demand for electricity bill
from Company even for residential colonies - Not improper - Further, appellant could
have switched off supply from their distributing mains which were in their custody and
possession could have disconnected supply themselves - Having not done so appellant
cannot blame respondents for not disconnecting supply and could not challenge demand
for electricity bill. (Paras 9, 10)
@page-SC726

Rajiv Dutta, Sr. Advocate, Ms. Surbhi Sharma, Milanka Chaudhury and M. A.
Chinnasamy, for Appellant; Pradeep Misra, for Respondents.
Judgement
JUDGMENT :-This appeal is directed against the final judgment and order dated
23.9.1999 passed by the Division Bench of the High Court of Judicature at Allahabad in
Civil Misc. Writ Petition No. 37862 of 1999, whereby the High Court dismissed the writ
petition preferred by the appellant-herein.
BACKGROUND FACTS:
2. The appellant-Modi Tele Fibres Ltd. was carrying on business of manufacturing
threads at Modinagar, Dist. Ghaziabad. However, the appellant-Company started
suffering huge losses on account of various factors such as fall in production, non-
availability of capital funds for meeting operational expenses etc. which were beyond the
control of the appellant. The appellant, on 16.06.1994, wrote a letter to respondent No.1-
U.P. State Electricity Board (hereinafter referred to as the 'UPSEB') to provide electric
supply directly to the residential colonies as the appellant was unable to continue the
payment directly on account of lack of funds. It is pertinent to mention here that
electricity to the residential colonies is fed through Modi Tele Fibres Ltd. Service
Connection No. 1008. The appellant-company entered into an agreement on 30.09.1994
in supersession of an earlier agreement dated 28.09.1983, with the UPSEB for supply of
electricity for 4000 KVA load of 11 KV voltage through the above-said Service
Connection. It is also pertinent to mention that an amount of Rs.67,46,700/- is lying with
the UPSEB as security, whereas the appellant has already been paying regularly the bills
for the electricity consumed by the company and the residential colonies. The appellant
wrote another letter on 30.06.1995 to the UPSEB informing that an application has been
made to the State Government for closing down of the unit and the UPSEB should
discontinue permanently the supply of electrical energy to the appellant vide S.C. No.
1008 reiterating its earlier request to provide separate domestic connection to residential
colonies. It was also reiterated that w.e.f. 01.08.1995, the appellant-company shall not be
liable for the supply made. Despite repeated requests, the UPSEB continued to supply
electricity through the service connection to the company as well as the residential
colonies at commercial rates. In reply, respondent No.2, vide letter dated 13.07.1995,
informed the appellant that only the person who had signed the agreement with the
UPSEB is empowered to apply for permanent disconnection and the request of the
appellant for permanent disconnection was not being considered. Thereafter, on
07.08.1995, the then Chairman of the appellant-Company who had signed the agreement
wrote a letter for permanent disconnection and to provide separate domestic connections
to the residential colonies reiterating that w.e.f. 06.09.1995, the Company shall not be
liable for the supply. Thereafter, on 04.09.1995, because of the heavy losses being
incurred, the appellant-company had to effect permanent closure and a notice of closure
dated 02.09.1995 was issued to all the employees. It is an admitted position that the
company w.e.f 04.09.1995 was not using any electric power for its factory, but electricity
was being given to the residential colonies through service connection No. 1008. The
appellant also brought to the notice of UPSEB that for realizing the electricity dues from
the residents of the colony, the High Court, in a similar case, passed an order in
pursuance of which bills directly were charged from the persons occupying the residential
quarters. Under these circumstances, the appellant again requested that it would hand
over all the infrastructure free of cost which is already used to provide separate domestic
connection to the residential colonies and asked to immediately discontinue electric
supply through the service connection. However, no heed was paid to the request of the
appellant and UPSEB kept on sending bills including the bills of electricity consumed by
the residential quarters. In the meantime, Punjab National Bank which extended financial
assistance to the appellant initiated recovery proceedings before the Debts Recovery
Tribunal. The Tribunal passed an interim order whereby the appellant was restrained from
leasing out the factory premises. Against that order, the appellant filed a petition under
Article 227 of the Constitution before the Delhi High Court, which vide order dated
08.03.1999 allowed the appellant to lease out the factory with a direction that 50% of the
rent amount shall be paid directly to the Punjab National Bank. Thereafter, 50% of the
rent is being received by the Bank and 50% rent by the appellant from the lessee.
@page-SC727
3. On 24.02.1999, UPSEB raised a bill demanding Rs.11,35,80,301/- from the appellant
for the period from April, 1995 to February, 1999 which includes electric supply to the
factory and to the residential quarters, surcharge, penalty etc. The appellant raised an
objection to the said bill on 24.04.1999 stating that it has repeatedly objected inasmuch as
firstly after closure of the factory on 04.09.1995 no electricity was being consumed and
was used by the factory and the bills pertain to consumption by the residential quarters
for which it had time and again requested for a separate connection.
4. On 24.07.1999 the Sub-Divisional Magistrate, Modinagar, Dist. Ghaziabad issued an
order to the lessee Lucky Tex Spinners Pvt. Ltd. directing that since an amount of
Rs.11,61,61,574.31 is due on the appellant as Government dues 50% of the rent amount
was attached and further directed to pay the same by pay order every month directly to
the Tehsildar. The UPSEB again issued a bill on 31.07.1999 for a sum of
Rs.13,40,42,018/-. In the meantime, the appellant made a reference to the BIFR under
Section 15 of the Sick Industrial Companies Act. On 20.08.1999, the appellant sent its
objection reiterating the stand that they were not liable to pay and returned the bills to the
UPSEB for cancellation. Being aggrieved by the order passed by the Sub Divisional
Magistrate, the appellant filed a writ petition in the High Court. The Division Bench of
the High Court by order dated 23.09.1999 dismissed the writ petition on the ground that
merely because the appellant had informed the UPSEB to provide separate domestic
connections to the residential colonies knowing fully well that they were already
consuming power through service connection No. 1008 in accordance with the terms of
the agreement, the liability will not cease. The High Court was of the view that while on
the one hand there was a prayer for disconnection but on the other hand regular
consumption not for a short period, but for years, the only conclusion was that the
consumer was enjoying the power supply and therefore the liability to pay for the power
consumed must be upheld. Dissatisfied with the order of the High Court the appellant
preferred the above appeal.
5. We heard Mr. Rajiv Dutta, learned counsel for the appellant and Mr. Pradeep Misra,
learned counsel for the respondents.
6. The grievance of the appellant is that even after the closure of their mill and in spite of
requests by way of letters and reminders for stopping the electrical supply to the
residential colony and for providing a separate metre connection to the residential
quarters of their employees, the respondent-UPSEB was unjustifiably claiming power
consumption charges from the appellant herein. Alternatively, it was submitted that it had
made payment upto March, 1995. However, if the bills for the period upto the date of
closure (i.e. upto 10.09.1995) are to be taken into account, then for the period from
01.04.1995 to 10.09.1995, the total amount of bills comes to Rs.1,14,10,734.00. Out of
the above, a sum of Rs.49,84,894/- is on account of supply of electricity to the residential
quarters which the appellant is not liable to pay as it had sent a notice in June, 1994. In
this regard, the admitted liability of the appellant is up to 10.09.1995 which comes to
Rs.64,25,840.00. The appellant had a security deposit of Rs.67,46,700/- with the UPSEB
and after adjusting the same, it is entitled to receive a sum of Rs.3,20,860/- from the
UPSEB.
7. It is not in dispute that the appellant was provided electric connection No. 1008 for
supply of electrical energy and an agreement had been executed on 30.09.1994 for supply
of 4000 KVA electric load. In the counter affidavit filed on behalf of respondent-UPSEB,
it has been specifically stated that the UPSEB, the predecessor in the interest of UP
Power Corporation, has no distributing means or any kind of control for contribution and
supply of electrical energy to the residential colonies of the workers of the appellant. In
fact in the counter affidavit the Board has stated that they were not aware about
arrangements made by the appellant for supply of power to their workers and the terms
and conditions for such supply as to whether it was free supply or whether the cost of
electricity consumed was being deducted from their wages. According to them, the
appellant was their consumer and bulk supply of 4000 KVA was being given to it and no
bifurcation in the connection as industrial or residential.
8. Learned counsel appearing for the appellant, by drawing our attention to various
clauses in the agreement and requests made by them in the form of letters seeking for dis-
connection of power supply to the
@page-SC728
residence of their employees and providing separate meter for their colonies, contended
that the respondents were not justified in demanding the amount as if arrears of power
consumed by them. We verified the requests made by the appellant. As rightly pointed out
by the respondents and in fact it was not disputed that electrical connection was provided
to the appellant-factory in service connection No 1008 for supply of electrical energy and
an agreement had been executed for the same on 30.09.1994 and supply to residential
colony was made by appellant under service connection No. 1008 of appellant. Therefore,
appellant cannot escape liability for electricity consumed in the residential colony. It
should also be noted that the requests for permanent disconnection made by appellant on
30.06.1995, 13.07.1995 and 07.08.1995 could not be acted upon as under the terms of the
supply agreement dated 30.09.1994, there could be no request for termination before the
end of two years. Significantly there was no letter for permanent disconnection after the
two year period, that is after 30.09.1996. Insofar as letter dated 16.06.1994 requesting for
electricity supply to residential quarters, it has to be ignored in view of the subsequent
agreement dated 30.09.1994 without separating supply to residential colony.
9. As rightly stated in para 15 of the additional affidavit filed on behalf of the UP Power
Corporation, in case the appellant did not want to supply the electricity to the residential
colonies of their workers they could have switched off the supply from their distributing
mains which were in their custody and possession. Admittedly, the appellant having such
a course available, did not do so because of their anticipation that law and order problem
would arise. Having failed to disconnect the electricity supply themselves, the appellant
cannot blame the respondents for not disconnecting the supply. It is true that pursuant to
the requests made by the appellant, the respondents/Board could have provided separate
connection for the residential connections in their colonies for the benefit of appellant's
employees. However, as pointed out in the additional affidavit necessary charges, namely,
costs and expenses for separate domestic connections were not paid. On the other hand,
the appellant was drawing power to their residential colonies in order to provide
uninterrupted supply to their employees. In those circumstances and in the light of the
specific information furnished in the additional affidavit particularly in paras 4, 8, 12 and
15, we are unable to accept the stand taken by the appellant.
10. With the materials placed before us, we are satisfied that the appellant being
consumer and consumed electricity through their service connection No. 1008 it has to
pay the amount for the same. We are also of the view that the appellant could have taken
effective steps for providing separate power connection to the residential colony of their
employees by approaching the respondents depositing necessary charges, cost and by
complying with the provisions of the Indian Electricity Act, the Electricity Supply Act,
rules and regulations made therein, which they failed to do. All the relevant aspects have
duly been considered and rightly rejected by the High Court. In regard to the alternative
contentions relating to excessive billing and non-adjustment of security deposit, these
factual aspects were not urged before the High Court and cannot be urged for the first
time before us. If there is any error in calculation of the amount shown as due, it is open
to the appellant to take up that issue separately with the respondents.
11. We do not find any ground for interference, consequently, the appeal fails and the
same is dismissed. However, there shall be no order as to costs.
Appeal dismissed.
AIR 2008 SUPREME COURT 728 "Shipping Corporation of India Ltd. v. M/s. Bharat
Earth Movers Ltd."
(From : Madras)
Coram : 2 S. B. SINHA AND G. S. SINGHVI, JJ.
Civil Appeal No. 5638 of 2007 (arising out of SLP (C) No. 7346 of 2005), D/- 5 -12
-2007.
Shipping Corporation of India Ltd. v. M/s. Bharat Earth Movers Ltd. and Anr.
(A) Carriage of Goods by Sea Act (26 of 1925), S.2 - Japanese Carriage of Goods by Sea
Act (1992), Art.1 - CARRIAGE OF GOODS - APPLICABILITY OF AN ACT -
Shipment of goods - Vessel sailed from port in Japan to its destination in India - Held,
Japanese Act and not Indian Act would be applicable.
O. S. A. No. 247 of 2000, D/- 2-12-2004 (Mad.), Reversed.
A bare perusal of S. 2 of the Indian Act 1925 would clearly demonstrate that the
@page-SC729
same applies to the carriage of goods by sea in ships carrying goods from any port in
India to any other port whether in or outside India which would mean that the Indian Act
shall apply only when the carriage of goods by sea in ships takes place from a port situate
within India and not a port outside India. The Japanese Act, on the other hand, applies in
a situation where carriage of goods by a ship is either from a loading Port or from a
discharging Port, either of which is located outside Japan. Therefore, Japanese Act will
clearly be applicable in the instant case, where goods were carried in vessel from Port in
Japan to its destination in India.
O. S. A. No. 247 of 2000, D/- 2-12-2004 (Mad.), Reversed.
(Para 17)
(B) Carriage of Goods by Sea Act (26 of 1925), S.4, Sch., Art.III, R.3, R.4 - CARRIAGE
OF GOODS - Damages - Shipment of 16 packages (cases) - Claimant confined its claim
of damages only for two cases - Liability of appellant would be limited in respect of two
cases - Cannot be calculated by taking into consideration the weight of 16 cases.
O. S. A. No. 247 of 2000, D/- 2-12-2004 (Mad.), Reversed. (Paras 18, 20)
(C) Carriage of Goods by Sea Act (26 of 1925), S.4, Sch., Art.III, R.3, R.4 - CARRIAGE
OF GOODS - Bill of lading - Invoice is not part of bill of lading - Value of goods is
required to be stated on bill of lading so as to enable shipping concern to calculate
quantum of freight - It cannot, in absence of any statutory provisions, be held to be
incorporated therein by necessary implication or otherwise. (Para 19)

C. A. Sundaram, Sr. Advocate, P. B. Suresh, Vipin Nair (for M/s. Temple Law Firm), for
Appellant; P. R. Sika, Chander Shekhar Ashri, for Respondents.
Judgement
S. B. SINHA, J. - :-Leave granted.
2. Application of the Indian Carriage of Goods by Sea Act, 1925 (for short "the Indian
Act") vis-a-vis the Japanese Carriage of Goods by Sea Act, 1992 (for short "the Japanese
Act") is in question in this appeal which arises out of a judgment and order dated
2.12.2004 passed by a Division Bench of the High Court of Judicature at Madras in OSA
No. 247 of 2000 affirming the judgment and decree dated 7.03.2000 passed by a learned
Single Judge thereof in CS No. 75 of 1996.
3. Appellant is an owner of a fleet of vessels. A consignment of six sets of Sub
Assemblies for PC 650 H.E. was entrusted by the respondent No. 1 for carriage thereof
from Kobe, Japan to Madras. It contained 16 packages. It arrived at the Port of Madras on
17.12.1994.
4. A part of the consignment was found in damaged condition. An inspection therefor was
made. Some damage was noticed in five cases. On the premise that the damage of short
delivery had been caused due to negligence on the part of the employees of the appellant,
a suit was filed on the original side of the Madras High Court. Claim of damage,
however, was therein confined to two cases only, viz., case Nos. 00002 and 0013. In the
said suit, the following relief was prayed for - :
"(a) A sum of Rs.16,72,143.87 with interest from the date of plaint till the date of
realization (interest of 18%) at 18% p.a as the transaction being commercial one under
Section 34 CPC."
5. In the written statement, the respondents inter alia pleaded 'limited liability' on their
part.
A learned Single Judge of the said Court held the appellant liable for payment of damages
being responsible for causing damage and loss to the consignment which had occurred at
a time when the cargo was in its charge.
6. In regard to the contention of the appellant that the contract of carriage having been
concluded in Japan, the Japanese Act shall apply and not the Indian Act, it was opined - :
"Another contention is raised on the side of the defendant that Indian Carriage of Goods
by Sea Act has been amended by the Multi Model Goods Transportation Act of 1993 and
the maximum liability of the carrier per package is not 100/- as contended by the plaintiff
and the maximum liability is 666.67 Special Drawing Rights per package or two special
drawing rights per kg of gross weight of the goods lost of damaged, whichever is higher.
Calculated thus, according to the defendant, the maximum liability of the defendant will
be only Rs. 1,31,471.11/- . Even assuming that the liability of the defendant has to be
calculated thus, the liability must be calculated taking into weight of 16 cases which are
governed
@page-SC730
by Ex.A-3 Bill of lading and in this case the liability will be more than what is claimed in
the plaint. Therefore, the defendant cannot resist the claim of the plaintiff on this ground
and the contract is governed by only Indian Carriage of Goods by Sea Act. Therefore, on
issue No. 6 and 7, I hold that the contract is governed by Indian Carriage of Goods by Sea
Act and the defendant is liable to the extent of the plaintiff's claim and these two issues
are therefore answered against the defendant."
7. The Division Bench of the High Court in an intra-court appeal preferred by the
appellant herein affirmed the said finding relying on or on the basis of Clause 6 of the
Bill of Lading, stating:
"On the basis of above clause 6, the submission of the learned counsel for the
appellant/defendant, that the Japanese Carriage of Goods by Sea Act is applicable to the
facts of the case, cannot be countenanced."
8. A notice was issued by this Court confined to the question as to whether the appellant
has a limited liability to the claim of the respondents.
9. Mr. C.A. Sundaram, learned senior counsel appearing on behalf of the appellant,
placed before us the relevant provisions of the Indian Act, Japanese Act as also the
International Convention for the Unification of Certain Rules of Law relating to Bills of
Lading (Hague Rules) to contend that as the price of the cargo had not been disclosed in
the Bill of Lading, the liability of the appellant must be held to be confined only to the
amount specified therein. It was urged that the High Court committed a serious error in
holding that the Indian Law would be applicable.
10. Mr. P.R. Sikka, learned counsel appearing on behalf of the respondents, however,
supported the impugned judgment.
11. Before embarking on the questions raised before us, we at the outset may observe that
the provisions of the Multimodal Transportation of Goods Act, 1993 whereto reference
has been made by the parties before the High Court are not applicable as admittedly the
mode of transport was by sea only and did not involve any multimodal transportation as
defined in Section 2(k) thereof.
12. The scope of the Japanese Act is stated in Article 1 thereof stating - :
"The provision of this Act (except article 20bis) shall apply to the carriage of goods by
ship from a loading port or to a discharging port, either of which is located outside Japan,
and Article 20bis shall apply to the carrier's and his servant's liability for damage to goods
caused by their tort."
Paragraph 4 of Article 2 defines "one unit of account" to mean "the amount equivalent to
one Special Drawing Right as defined in paragraph (1) of Article 3 of the International
Monetary Fund Agreement". Article 4 confers a liability upon the carrier stating that it
shall not be relieved therefrom unless exercise of due diligence under the said Article is
proved.
The provision regarding limited liability is contained in Article 13 of the Japanese Act,
which reads as under - :
"(1) The carrier's liability for a package or unit of the goods shall be the higher of the
following - :
1) An amount equivalent to 666.67 units of account.;
2) An amount equivalent to 2 units of account per kilo of gross weight of the goods lost,
damaged or delayed.
(2) The unit of account used in each item of the preceding paragraph shall be the final
publicized one at the date on which the carrier pays damages in respect of the goods.
(3) Where a container, pallet or similar article of transport (which as referred to as
"containers and etc." in this paragraph) is used for the transportation of the goods, the
number of containers and etc. or units shall be deemed to be the number of the packages
or units of the goods for the purpose of the preceding paragraph unless the goods' number
or volume or weight is enumerated in the bill of lading..."
13. Indian Act, however, in Section 2, provides for the application of Rules in the
following terms - :
"Subject to the provisions of this Act, the Rules set out in the Schedule (hereinafter
referred to as "the Rules") shall have effect in relation to and in connection with the
carriage of goods by sea in ships carrying goods from any port in India to any other port
whether in or outside India."
14. Schedule appended thereto provides for the Rules relating to Bills of Lading. Article
IV provides for rights and immunities, the relevant portion whereof reads as under - :
@page-SC731
"1. Neither the carrier nor the ship shall be liable for loss or damage arising or resulting
from unseaworthiness unless caused by want of due diligence on the part of the carrier to
make the ship seaworthy, and to secure that the ship is properly manned, equipped and
supplied, and to make the holds, refrigerating and cool chambers and all other parts of the
ship in which goods are carried fit and safe for their reception, carriage and preservation
in accordance with the provisions of paragraph - 1 of Article III.
Whenever loss or damage has resulted from unseaworthiness the burden of proving the
exercise of due diligence shall be on the carrier or other person claiming exemption under
this section."
Paragraph 5 of Article IV reads, thus - :
"5. Neither the carrier nor the ship shall in any event be or become liable for any loss or
damage to or in connection with goods in an amount exceeding 1001 per package or unit,
or the equivalent of that sum in other currency, unless the nature and value of such goods
have been declared by the shipper before shipment and inserted in the bill of lading......"
15. We may also notice that under the Special Drawing Rights as contained in the
International Monetary Fund Special Drawing Rights would mean 1.00XDR as
equivalent to 64.0948 INR and 666.67XDR as equivalent to 42,730.20 INR.
16. Clause 5 of the Hague Rules, to which both India and Japan are parties, reads as
under - :
"5. Neither the carrier nor the ship shall in any event be or become liable for any loss or
damage to or in connection with goods in an amount exceeding 100 pounds sterling per
package or unit, or the equivalent of that sum in other currency unless the nature and
value of such goods have been declared by the shipper before shipment and inserted in
the bill of lading.
This declaration if embodied in the bill of lading shall be prima facie evidence, but shall
not be binding or conclusive on the carrier."
17. Having noticed the relevant statutory provisions, we may also notice the relevant
terms and conditions of Bill of Lading which are as under:
"Clause 6 - : Liability for loss or damage where the stage is not known - :
When in accordance with the condition 4 hereof, the CTO is liable to pay compensation
in respect of loss or damage to the goods and the stage of transport where the loss or
damage occurred is not known, the liability of the CTO in respect of such loss or damage
shall not exceed the monetary limit indicated in this regard, in any international
convention or national law that would have applied, if the contract was for the carriage of
goods from a seaport in India and had been covered by a ocean bill of lading. However,
the CTO shall not in any case be liable for an amount greater than the actual loss to the
person entitled to make the claim...
Clause 7 - : Liability for loss or damage where the stage is known - :
(A) When in accordance with the condition 4 hereof, the CTO is liable to pay
compensation in respect of loss or damage to the goods and the stage of transport where
the loss or damage occurred is known, the liability of the CTO in respect of such loss or
damage shall be determined by the provisions contained in any International Convention
or National Law, which provisions would have applied if the claimant had made a
separate and direct contract with the CTO in respect of the particular stage of transport
where the loss or damage occurred and received as evidence thereof any particular
document which may be issued in order to make such International Convention or
National Law applicable..."
A bare perusal of Section 2 of the Indian Act would clearly demonstrate that the same
applies to the carriage of goods by sea in ships carrying goods from any port in India to
any other port whether in or outside India which would mean that the Indian Act shall
apply only when the carriage of goods by sea in ships takes place from a port situate
within India and not a port outside India. The Japanese Act, on the other hand, applies in
a situation where carriage of goods by a ship is either from a loading Port or from a
discharging Port, either of which is located outside Japan. Therefore, Japanese Act will
clearly be applicable in the instant case.
The High Court, as noticed hereinbefore, applied the provisions of the Indian law. We
may notice that Clause 6 of the Bill of Lading merely raises a legal fiction. It applies to a
case where the place of occurrence of loss
@page-SC732
or damage is not known. It merely provides that in such an event the quantum of loss
shall not exceed the monetary limit provided for in any international convention or
national law.
No reason has been assigned in support of its findings by the High Court. Clause 7 of the
Bill of Lading also should be read with Clause 6 thereof. In this case, the vessel sailed
from Japan; its destination being Chennai.
As the originating port is outside India, Section 2 of the Indian Act, as noticed
hereinbefore, will have no application. The High Court, in our opinion, misread the said
provision.
18. The provisions noticed hereinbefore, whether of the Japanese Act or the Indian Act or
the Hague Rules, provide for a limited liability. Contention of the appellant had been
rejected by the High Court inter alia on the premise that the plaintiff- respondent was
entitled to damages higher than the maximum liability provided for therein as the
quantum of damages was to be calculated upon taking into consideration the weight of all
the 16 cases and not only of two cases.
With respect, the approach of the High Court is wrong. If the plaintiff-respondent
confined its claim of damages only for two cases, there was no room for making the
observation that the liability must be calculated taking into consideration the weight of 16
cases. Even in support of the said conclusion, no reason has been assigned. The
discussions of the High Court end with the said finding which apparently is contrary to
the statutory provisions.
19. A contention has been raised before us for the first time that the value of the goods
had been declared in the Bill of Lading. It is based on the premise that Bill of Lading
refers to the invoice. We cannot accept the said contention. Invoice is not a part of the
Bill of Lading. The value of the goods is required to be stated on the Bill of Lading so as
to enable the shipping concern to calculate the quantum of freight. It cannot, in absence
of any statutory provisions, be held to be incorporated therein by necessary implication or
otherwise.
20. We, therefore, are of the opinion that the liability of the appellant being limited and
that too in respect of the two cases, the matter should be considered afresh in the light of
the observations made hereinbefore by the learned Single Judge. To the aforementioned
extent, the judgments and decrees of the High Court are set aside.
21. The appeal is allowed to the aforementioned extent. There shall, however, be no order
as to costs.
Order accordingly.
AIR 2008 SUPREME COURT 732 "General Manager, UCO Bank v. M. Venuranganath"
(From : Andhra Pradesh)*
Coram : 2 Dr. A. PASAYAT AND AFTAB ALAM, JJ.
Civil Appeal No. 5826 of 2007 (arising out of SLP (C) No. 23654 of 2004), D/- 12 -12
-2007.
General Manager, UCO Bank and Anr. v. M. Venuranganath.
Banking Companies (Acquisition and Transfer of Undertakings) Act (5 of 1970), S.19 -
United Commercial Bank (Conduct and Discipline and Appeal) Regulations (1976),
Regn.15(2), Regn.21(a) - BANKING - SALARIES - DISCIPLINARY ACTION -
SERVICE MATTERS - Manual on Disciplinary Action and Related Matters of UCO
Bank, Cl. 22(8) - Salary and allowances for period of suspension - Claim by officer of
UCO Bank, on being acquitted in criminal case - Maintainable under Cl. 22(8) of Manual
- Officer entitled to all benefits which he got while working - Cl. 22(8) is relatable to
Regn. 15 (2) which provides guidelines for operating Regn. 15(2) - Regn. 21(a) would
not be applicable since he is officer. (Paras 12, 13)

U. N. Bhachawat, Sr. Advocate, B. L. Anand, Alok Bhachawat and Ms. Pratibha Jain, for
Appellants; Ms. C. K. Sucharita, for Respondent.
* W. A. No. 685 of 2004, D/- 17-6-2004 (AP).
Judgement
Dr. ARIJIT PASAYAT, J. - :-Leave granted.
2. Challenge in this appeal is to the Judgment of a Division Bench of the Andhra Pradesh
High Court allowing the writ appeal filed by the respondent.
3. Background facts in a nutshell are as follows - :

The respondent, who, at the relevant point of time was Branch Manager of appellant
No.l-Bank and was posted at Nellore in Andhra Pradesh was charged and tried along with
one Shrinivasulu s/o. Chenchuramaiah reported in 2003 Lab IC 369 (AP)

@page-SC733
for offences punishable under Sections 120-B, 471 and 477 of Indian Penal Code 1860
(in short the 'the IPC') and Section 5(2) read with Section 5 (1)(d) of the Prevention of
Corruption Act, 1947 (in short the 'Prevention of Corruption Act'). Both the accused
persons were tried in the Court of Special Judge for CBI cases. They were acquitted by
judgment dated 11.12.2002 giving them benefit of doubt. The respondent was placed
under suspension from 15.06.1988 till he was reinstated on 04.05.1993. After his
reinstatement, departmental proceedings were initiated. The same were questioned by a
writ petition being writ Petition No.15797 of 1994 which was allowed by learned single
Judge. But in writ appeal No.884 of 1998, a Division Bench directed dismissal of the writ
petition. The departmental enquiry was concluded on 29.02.2003. The respondent was
found guilty. So far as payment of salary, allowances etc. are concerned, relevant portion
of the order read as follows - :
"In the light of the above punishment the undersigned further directs that Sri M. Venu
Ranganath will not be entitled to any salary and allowances and other attendant- benefits
including increment for the period spent by him under suspension, save and except the
Subsistence Allowance already paid to him during the said period."
3. The respondent filed writ petition being Writ Petition No.11615 of 1994 claiming pay
and allowances for the period of suspension which was dismissed by a learned Single
Judge. Respondent filed Writ Appeal No.685 of 2004 which was allowed by the
impugned order. It was inter-alia held by the Division Bench that C1ause-22 of the
applicable Manual i.e. A Manual on Disciplinary Action and Related Matters of UCO
Bank governed the case and not Regulation 15(2) of the United Commercial Bank
(Conduct and Discipline and Appeal) Regulation, 1976.
4. According to learned counsel for the appellants, the Division Bench was not justified in
holding that Clause 22(8) of the Manual was to operate and not Regulation 15(2) of the
Regulation. It is stated that the Manual is nothing but guidelines inducted and at the most,
may be termed as Executive Instructions. The Regulations are statutory in nature.
5. It is pointed out that acquittal in a criminal case has nothing to do with departmental
proceedings and law is clearly well settled. Notwithstanding acquittal in a criminal case,
departmental proceedings can be initiated and/or continued.
6. In response, learned counsel for the respondent submitted that the factual position
shows that the only time respondent was placed under suspension was because of the
criminal case under Regulation 12(1)(b). Even though departmental proceedings were
initiated, the respondent was never placed under suspension. According to her, the case
covered by Regulation 15(2) relates to cases not covered by sub-Regulation (1).
7. There can be no doubt that criminal proceedings and departmental proceedings operate
in different fields. Even though the person may have been acquitted in a criminal trial,
there is no embargo on his being departmentally proceeded against. But the question here
is slightly different. The relevant provisions need to be quoted - :
"11. Special procedure in certain cases - :
Notwithstanding anything contained in regulation 6 or regulation 7 or regulation 8 the
Disciplinary Authority may impose any of the penalties specified in regulation 4 if the
officer/employee has been convicted on a criminal charge, or on the strength of facts or
conclusions arrived at by a judicial trial."
Regulation 12 - : Suspension -:
(1) An officer employee may be placed under suspension by the competent authority-
(a) where a disciplinary proceeding against him is contemplated or is pending; or
(b) where a case against him in respect of any criminal offence is under investigation,
inquiry or trial.
(2) An officer employee shall be deemed to have been placed under suspension by an
order of the competent authority-
(a) with effect from the date of his detention, if he is detained in custody, whether on a
criminal charge or otherwise, for a period exceeding forty-eight hours;
(b) with effect from the date of conviction, if in the event of a conviction for an offence,
he is sentenced to a term of imprisonment exceeding forty-eight hours and is not
forthwith dismissed or removed or compulsorily retired consequent to such conviction.
Explanation:- The period of forty-eight
@page-SC734
hours referred to in clause (b) of this sub-regulation shall be computed from the
commencement of the imprisonment after the conviction and for this purpose,
intermittent periods of imprisonment, if any, shall be taken into account.
(3) Where a penalty of dismissal, removal or compulsory retirement from service
imposed upon an officer employee under suspension is set aside in appeal or on review
under these regulations and the case is remitted for further inquiry or action or with any
directions, the order of his suspension shall be deemed to have continued in force on and
from the date of the original order of dismissal, removal or compulsory retirement and
shall remain in force until further orders.
(4) Where a penalty of dismissal, removal or compulsorily retirement from service
imposed upon an officer employee under suspension is set aside or declared or rendered
void in consequence of or by a decision of a court of law, and the disciplinary authority,
on consideration of the circumstances of the case, decides to hold further inquiry against
him on the allegations on which the penalty of dismissal, removal or compulsory
retirement was originally imposed, the officer employee shall be deemed to have been
placed under suspension by the competent authority from the date of the original order of
dismissal, removal or compulsory retirement and shall continue to remain under
suspension until further orders.
(5) (a) An order of suspension made or deemed to have been made under this regulation
shall continue to remain in force until it is modified or revoked by the authority
competent to do so.
(b) An order of suspension made or deemed to have been made under this regulation may
at any time be modified or revoked by the authority which made or is deemed to have
made the order."
"Regulation 15 - : Pay allowances and treatment of service on termination of suspension -
:
(1) Where the competent authority holds that the officer employee has been fully
exonerated or that the suspension was unjustifiable, the officer employee concerned shall
be granted the full pay to which he would have been entitled had he not been suspended,
together with any allowance of which he was in receipt immediately prior to his
suspension, or may have been sanctioned subsequently and made applicable to all officer
employees.
(2) In all cases other than those referred to in sub-regulation (1), the officer employee
shall be granted such proportion of pay and allowances as the Competent Authority may
direct;
Provided that the payment of allowances under this sub-regulation shall be subject to all
other conditions to which such allowances are admissible - :
Provided further that the pay and allowances granted under this sub-regulation shall not
be less than the subsistence and other allowances admissible under regulation 14.
3(a) In a case falling under sub-regulation (1) the period of absence from duty shall, for
all purposes, be treated as a period spent on duty;
(b) In a case falling under sub-regulation (2), the period of absence from duty shall not be
treated as a period spent on duty unless the Competent Authority specifically directs, for
reason to be recorded in writing, that it shall be so treated for any specific purpose."
Clause 22.8 of the Manual "Where a suspended officer employee has been fully
exonerated in the departmental enquiry or acquittal by the court of law of the charges
levelled against him the competent authority holds that the suspension was unjustifiable,
he would be entitled to all benefits to which he would have been normally entitled, had
he been on duty. However, the employee in such a case would not be entitled to
accumulate leave beyond the permissible limit."
8. A bare reading of Regulation 12 shows that suspension can be directed under two
circumstances. The first is where a disciplinary proceeding against the concerned
employee is contemplated or is pending; and the second is where a case against him in
respect of any criminal offence is under investigation, inquiry or trial. Undisputedly, the
respondent was placed under suspension under Regulation 12(i)(b). Regulation 15 deals
with two types of situations. As the heading itself shows, it relates to pay and allowances
and termination of service on termination or suspension. Sub-Regulation (1) deals with
the power of competent authority on completion of the departmental
@page-SC735
enquiry. All other cases, except those covered by Sub-Regulation (1), the competent
authority has to direct as regards the proportion of pay and allowances to be granted.
9. Clause 22 of the Manual deals with two situations. One is full exoneration in the
departmental proceedings and other is acquittal by the court of law of the charges
levelled. Clause 22(8) specifically deals with acquittal by criminal court. It does not
exclude acquittal where accused has been given benefit of doubt. A close reading of sub-
regulation (1) of Regulation 15 would show that the same is relatable to departmental
proceedings. While other cases, meaning, cases not covered by departmental proceedings,
which obviously would include the criminal trial are covered by sub-regulation (2).
10. At this juncture, it would also be relevant to take note of Clause 21(9) of the
Regulation. It deals with entitlements for benefits after acquittal by a criminal court.
11. The same reads as follows - :
"Where a suspended employee has been fully exonerated in the departmental enquiry or
honourably acquitted by the courts of law of the charges levelled against him, he would
be entitled to all benefits to which he would have been normally entitled, had he been on
duty. However, the employee in such a case would not be entitled to all benefits to which
he would have been normally entitled, had he been on duty. However, the employee in
such a case would not be entitled to accumulate leave beyond the permissible limit.
However, if the employee is acquitted by being given the benefit of doubt he may be paid
such portion of pay and allowances as the management may deem proper and the period
of his suspension shall not be treated as period spent on duty unless the management so
direct."
12. It is to be noted that Regulation 21(9) does not relate to officers and the respondent
herein was an officer and, therefore, Regulation 21 has no relevance as it covers only the
award staff.
13. Clause 22(8) obviously is relatable to Clause 15(2), meaning that it provides
guidelines for operating sub-Regulation (2) of Regulation 15. The High Court was,
therefore, justified in holding that because of Clause 22(8), the respondent was entitled to
all benefits to which he would have been normally entitled, had he been on duty.
Therefore, no interference is called for.
14. The appeal is, accordingly, dismissed. There will be no order as to costs.
Appeal dismissed.
AIR 2008 SUPREME COURT 735 "National Insurance Co. v. Deepa Devi"
(From : AIR 2006 (NOC) 1011 : 2005(4) ACC 194) (HP))
Coram : 2 S. B. SINHA AND LOKESHWAR SINGH PANTA, JJ.
Civil Appeal No. 5796 of 2007 (arising out of SLP (C) No. 22778 of 2005), D/- 11 -12
-2007.
National Insurance Co. Ltd. v. Deepa Devi and Ors.
Motor Vehicles Act (59 of 1988), S.168, S.2(30) - Representation of the People Act (43 of
1951), S.160 - MOTOR VEHICLES - ELECTION - POSSESSION - Compensation -
Liability of registered owner - Car in question at time of accident was requisitioned by
Magistrate for assembly elections - Being requisitioned by statutory authority, owner had
no other alternative but to handover possession - Once possession is handed over, owner
cannot exercise any control thereupon - State shall be, therefore, liable to pay
compensation and not registered owner of car.
2004 AIR SCW 4974, 2006 AIR SCW 5871, Relied on.
2003 AIR SCW 780, Disting.
1989 AC J 596 (AP); AIR 1996 Guj. 51; and AIR 1988 Ori 229, Approved.
AIR 2006 (NOC) 1011 : 2005 (4) ACC 194 (HP), Reversed. (Paras 10, 13, 18)
Cases Referred : Chronological Paras
2006 AIR SCW 5871 : AIR 2007 SC 465 : 2007 CLC 26 : 2007 (1) AIR Jhar R 791 (Rel
on) 11
2004 AIR SCW 2586 : AIR 2004 SC 2258 11
2004 AIR SCW 4974 : AIR 2004 SC 4179 : 2004 Lab IC 3688 : 2004 All LJ 3425 (Rel
on) 11
2003 AIR SCW 780 : AIR 2003 SC 1446 (Disting) 14
2001 AIR SCW 5023 : AIR 2002 SC 302 11
1997 AIR SCW 3531 : AIR 1997 SC 3444 (Rel. on) 6, 15
AIR 1996 Guj 51 (Approved) 17
1989 ACJ 596 (AP) (Approved) 16
AIR 1988 SC 1332 (Disting) 7, 12
AIR 1988 Ori 229 (Approved) 16
@page-SC736

Parmanand Gaur, for Appellant; J. S. Attri and B. K. Satija, for Respondents.


Judgement
S. B. SINHA, J. - :-Leave granted.
2

. The short question involved in this appeal arising out of a judgment and order dated
17.05.2005 passed by the High Court of Himachal Pradesh in FAO (MVA) No. 208 of
1997 is as to whether in the event a car is requisitioned by the State for the purpose of
deploying the same in the election duty, who would be liable to pay compensation to the
victim of the accident in terms of the provisions of the Motor Vehicles Act, 1988 (for
short "the 1988 Act"). reported in AIR 2006 (NOC) 1011

3. Respondent No. 3 was the owner of a Maruti Gypsy bearing Registration No. HIS
6095. Appellant Company issued a policy of insurance in favour of Respondent No. 4 for
the said Maruti Gypsy for the period 10.06.1993 to 9.06.1994. In regard to limitation of
its use, the insurance policy provided - :
"For private car IXI and Motor Cycle/Scooter IYI.
Use only for social, domestic and pleasures and insured's own purpose"
4. The car in question was requisitioned during the Assembly Elections in the year 1993
by the Sub-Divisional Magistrate Rampur through the Deputy Commissioner, Shimla.
The said vehicle was in possession as also under the control of the said officer. On or
about 17.11.1993 while the Sub-Divisional Magistrate Rampur was travelling in the said
vehicle, an accident occurred as a result whereof a boy named Satish Kumar sustained
injuries. He later on expired.
5. Respondent No. 1 Deepa Devi and Joginder being the heirs and legal representatives of
the deceased filed an application for compensation in terms of Section 166 of the 1988
Act. The State of Himachal Pradesh as also the Sub-Divisional Magistrate Rampur were
impleaded therein. The Motor Accident Claims Tribunal in its judgment dated 28.09.1996
upheld the contention of the Insurance Company that under the terms of the insurance
policy, it was not liable to reimburse the owner of the vehicle as regards his liability to
pay compensation on account of said accident. A Division Bench of the High Court,
however, by reason of the impugned judgment, has set aside the said award of the
Tribunal, holding - :
"In view of the above discussion, the appeal is allowed and the award of the Tribunal is
modified and it is held that the owner of the vehicle, the State Government and the
Insurance Company are all jointly and severally liable to pay the compensation. Since the
vehicle was insured with the Insurance Company it shall deposit the amount payable to
the claimants..."
6

. Mr. Parmanand Gaur, learned counsel appearing on behalf of the appellant, submitted
that having regard to the definition of 'owner' as contained in Section - 2(30) of the 1988
Act and as the vehicle in question was not used for the purpose for which the contract of
insurance was entered into, the judgment of the High Court cannot be sustained. Strong
reliance in this behalf has been placed on Rajasthan State Road Transport Corporation v.
Kailash Nath Kothari and Others [(1997) 7 SCC 481]. 1997 AIR SCW 3531

. Mr. J. S. Attri, learned counsel appearing on behalf of Respondent Nos. 5 and 6, on the
other hand, would support the judgment contending that this Court in Guru Govekar v.
Miss Filomena F. Lobo and Others [(1988) 3 SCC 1] has categorically held that even if
the vehicle remains in possession of a third party, the registered owner of the vehicle shall
continue to be the owner within the meaning of the provisions of the 1988 Act and, thus,
would be liable for payment of damages to the victims of an accident. AIR 1988 SC
1332

8. The 1988 Act was enacted to consolidate and amend the law relating to motor vehicles.
It repeals and replaces the Motor Vehicles Act, 1939 (for short "the 1939 Act").
9. "Owner" has been defined in Section 2(19) of the 1939 Act to mean - :
"In this Act, unless the context otherwise requires,
*** *** ***
(19) "owner" means, where the person in possession of a motor vehicle is a minor, the
guardian of such minor, and in relation to a motor vehicle which is the subject of a higher
purchase agreement, the person in possession of the vehicle under that agreement;"
However, the said definition underwent a change by reason of Section 2(30) of the 1988
Act providing - :
"In this Act, unless the context otherwise requires,
*** *** ***
@page-SC737
(30) "owner" means a person in whose name a motor vehicle stands registered, and where
such person is a minor, the guardian of such minor, and in relation to a motor vehicle
which is the subject of a hire-purchase, agreement, or an agreement of lease or an
agreement of hypothecation, the person in possession of the vehicle under that
agreement;"
10. Parliament either under the 1939 Act or the 1988 Act did not take into consideration a
situation of this nature. No doubt, Respondent Nos. 3 and 4 continued to be the registered
owner of the vehicle despite the fact that the same was requisitioned by the District
Magistrate in exercise of its power conferred upon it under the Representation of People
Act. A vehicle is requisitioned by a statutory authority, pursuant to the provisions
contained in a statute. The owner of the vehicle cannot refuse to abide by the order of
requisition of the vehicle by the Deputy Commissioner. While the vehicle remains under
requisition, the owner does not exercise any control thereover. The driver may still be the
employee of the owner of the vehicle but he has to drive it as per the direction of the
officer of the State, who is put in-charge thereof. Save and except for legal ownership, for
all intent and purport, the registered owner of the vehicle loses entire control thereover.
He has no say as to whether the vehicle should be driven at a given point of time or not.
He cannot ask the driver not to drive a vehicle on a bad road. He or the driver could not
possibly say that the vehicle would not be driven in the night. The purpose of requisition
is to use the vehicle. For the period the vehicle remains under the control of the State and/
or its officers, the owner is only entitled to payment of compensation therefor in terms of
the Act but he cannot exercise any control thereupon. In a situation of this nature, this
Court must proceed on the presumption that the Parliament while enacting the 1988 Act
did not envisage such a situation. If in a given situation, the statutory definitions
contained in the 1988 Act cannot be given effect to in letter and spirit, the same should be
understood from the common sense point of view.
11

. In Mukesh K. Tripathi v. Senior Division Manager, LIC and Others [(2004) 8 SCC 387],
this Court observed - :2004 AIR SCW 4974, (Para 38)

"The interpretation clause contained in a statute although may deserve a broader meaning
having employed the word "includes" but therefor also it is necessary to keep in view the
scheme of the object and purport of the statute which takes him out of the said definition.
Furthermore, the interpretation section begins with the words "unless the context
otherwise requires".
In Ramesh Mehta v. Sanwal Chand Singhvi, it was noticed: (SCC p. 426, paras 27-28)
2004 AIR SCW 2586, (Paras 27-28)

"A definition is not to be read in isolation. It must be read in the context of the phrase
which would define it. It should not be vague or ambiguous. The definition of words
must be given a meaningful application; where the context makes the definition given in
the interpretation clause inapplicable, the same meaning cannot be assigned.

In State of Maharashtra v. Indian Medical Assn. one of us (V.N. Khare, C.J.) stated that
the definition given in the interpretation clause having regard to the contents would not
be applicable. It was stated: (SCC p. 598, para 8) 2001 AIR SCW 5023, (Para 8)

'A bare perusal of Section 2 of the Act shows that it starts with the words "in this Act,
unless the context otherwise requires...". Let us find out whether in the context of the
provisions of Section 64 of the Act the defined meaning of the expression "management"
can be assigned to the word "management" in Section 64 of the Act. In para 3 of the
Regulation, the Essentiality Certificate is required to be given by the State Government
and permission to establish a new medical college is to be given by the State Government
under Section 64 of the Act. If we give the defined meaning to the expression
"management" occurring in Section 64 of the Act, it would mean the State Government is
required to apply to itself for grant of permission to set up a government medical college
through the University. Similarly it would also mean the State Government applying to
itself for grant of Essentiality Certificate under para 3 of the Regulation. We are afraid the
defined meaning of the expression "management" cannot be assigned to the expression
"management" occurring in Section 64 of the Act. In the present case, the context does
not permit or requires to apply the defined meaning to the word "management" occurring
in
@page-SC738
Section 64 of the Act.'"

[See also Pandey and Co. Builders (P) Ltd. v. State of Bihar and Another (2007) 1 SCC
467] 2006 AIR SCW 5871

12

. In Guru Govekar (supra), this Court was considering the definition of 'owner' under the
1939 Act. Therein the car was handed over to a mechanic for carrying out certain
electrical repairs to the car, when the accident occurred. This Court in the said fact
situation held - : AIR 1988 SC 1332

"14. Thus on the facts of the case before us we are of the view that the insurer is liable to
pay the compensation found to be due to the claimant as a consequence of the injuries
suffered by her in a public place on account of the car colliding with her on account of
the negligence of the mechanic who had been engaged by the repairer who had
undertaken to repair the vehicle by virtue of the provisions contained in Section 94 of the
Act which provides that no person shall use except as a passenger or cause or allow any
other person to use a motor vehicle in a public place, unless there is in force in relation to
the use of the vehicle by that person or that other person, as the case may be, a policy of
insurance complying with the requirements of Chapter VIII of the Act. Any other view
will expose innocent third parties to go without compensation when they suffer injury on
account of such motor accidents and will defeat the very object of introducing the
necessity for taking out insurance policy under the Act."
13. It is not a case where the car was handed over to a person with consent of the owner
thereof. When a vehicle is requisitioned, the owner of the vehicle has no other alternative
but to handover the possession to statutory authority.
14

. We are not oblivious of another decision of this Court in Rikhi Ram and Another v.
Sukhrania (Smt) and Others [(2003) 3 SCC 97] wherein keeping in view the provisions of
Sections 94 and 95 of the 1939 Act, a plea taken by the owner of the car that he has
transferred the same in favour of another person and, thus, he had no liability for payment
of compensation was negatived, stating - : 2003 AIR SCW 780

"5. The aforesaid provision shows that it was intended to cover two legal objectives.
Firstly, that no one who was not a party to a contract would bring an action on a contract;
and secondly, that a person who has no interest in the subject-matter of an insurance can
claim the benefit of an insurance. Thus, once the vehicle is insured, the owner as well as
any other person can use the vehicle with the consent of the owner. Section 94 does not
provide that any person who will use the vehicle shall insure the vehicle in respect of his
separate use.
6. On an analysis of Sections 94 and 95, we further find that there are two third parties
when a vehicle is transferred by the owner to a purchaser. The purchaser is one of the
third parties to the contract and the other third party is for whose benefit the vehicle was
insured. So far, the transferee who is the third party in the contract, cannot get any
personal benefit under the policy unless there is a compliance with the provisions of the
Act. However, so far as third-party injured or victim is concerned, he can enforce liability
undertaken by the insurer."
We are also not concerned with such a situation.
15

. In Kailash Nath Kothari (supra), however, this Court in a case, where a bus was given
on lease by the owner of the vehicle Shri Sanjay Kumar in favour of the Rajasthan State
Road Transport Corporation, held that when an accident takes place when the bus was
plied under the control of the Corporation, it was the Corporation alone who would be
liable for payment of compensation, stating - : 1997 AIR SCW 3531, (Para 17)

"...Driver of the bus, even though an employee of the owner, was at the relevant time
performing his duties under the order and command of the conductor of RSRTC for
operation of the bus. So far as the passengers of the ill-fated bus are concerned, their
privity of contract was only with the RSRTC to whom they had paid the fare for
travelling in that bus and their safety therefore became the responsibility of the RSRTC
while travelling in the bus. They had no privity of contract with Shri Sanjay Kumar, the
owner of the bus at all. Had it been a case only of transfer of services of the driver and
not of transfer of control of the driver from the owner to RSRTC, the matter may have
been somewhat different. But on facts in this case and in view of Conditions 4 to 7 of the
agreement ( supra ), the RSRTC must be held to be vicariously liable for the tort
committed by the driver while plying the bus under contract of the RSRTC. The general
@page-SC739
proposition of law and the presumption arising therefrom that an employer , that is the
person who has the right to hire and fire the employee, is generally responsible
vicariously for the tort committed by the employee concerned during the course of his
employment and within the scope of his authority, is a rebuttable presumption. If the
original employer is able to establish that when the servant was lent, the effective control
over him was also transferred to the hirer, the original owner can avoid his liability and
the temporary employer or the hirer, as the case may be, must be held vicariously liable
for the tort committed by the employee concerned in the course of his employment while
under the command and control of the hirer notwithstanding the fact that the driver would
continue to be on the payroll of the original owner. The proposition based on the general
principle as noticed above is adequately rebutted in this case not only on the basis of the
evidence led by the parties but also on the basis of Conditions 6 and 7 ( supra ), which go
to show that the owner had not merely transferred the services of the driver to the RSRTC
but actual control and the driver was to act under the instructions, control and command
of the conductor and other officers of the RSRTC."
We may also notice at this stage certain judgments of some High Courts.
16

. In The National Insurance Co. Ltd. v. Durdadahya Kumar Samal and Others [1988 (2)
T.A.C. 25] where the vehicle was requisitioned by the Collector for election duty, the
High Court of Orissa held - : AIR 1988 Ori 229

"In a vehicle requisitioned, the driver remains under the control of the Collector and by
such driving the vehicle he can be accepted to have been employed by the Collector.
Thus, the Collector would be vicariously liable for the act of the driver in the present
case."
[See also New India Assurance Co. Ltd. v. S. Ramulamma and others 1989 ACJ 596]
17. In Chief Officer, Bhavnagar Municipality and another v. Bachubhai Arjanbhai and
others [AIR 1996 Gujarat 51], the High Court of Gujarat held - :
"7. The facts on record clearly indicate that the vehicle in question which belonged to the
State of Gujarat was entrusted to the Municipality for distribution of water to the citizens.
It was implicit in allowing the vehicle being used for such purpose that the State of
Gujarat which owned the vehicle also caused or allowed any driver of the Municipality
who was engaged in the work of distribution of water to the citizens, to use motor vehicle
for the purpose. Therefore, when the vehicle was driven by the driver of the Municipality
and the accident resulted due to his negligence, the insurer of the vehicle became liable to
pay the compensation under the provisions of the Act. It is, therefore, held that the State,
as the owner of the vehicle and the respondent Insurance Company as its insurer were
also liable to pay the compensation awarded by the Tribunal..."
18. We, therefore, are of the opinion that the State shall be liable to pay the amount of
compensation to the claimants and not the registered owner of the vehicle and
consequently the appellant herein.
19. For the reasons aforementioned, the impugned judgment cannot be upheld. It is set
aside accordingly. The appeal is allowed. No costs.
Appeal allowed.
AIR 2008 SUPREME COURT 739 "Sangam Spinners v. Regional Provident Fund
Commissioner-I"
(From : Rajasthan)*
Coram : 2 Dr. A. PASAYAT AND P. SATHASIVAM, JJ.
Civil Appeal No. 1785 of 2001, D/- 4 -12 -2007.
Sangam Spinners v. Regional Provident Fund Commissioner-I.
Employees' Provident Funds and Miscellaneous Provisions Act (19 of 1952), S.16(1)(d)
(prior to Amendment Act 10 of 1998) - PROVIDENT FUND - REPEAL AND SAVINGS
- Exemption to new establishment - Granted under S. 16(1)(d) for period of three years -
Employer would be entitled to protection for period of three years starting from date of
setting up of establishment - Irrespective of meanwhile repeal of provision for infancy
benefit.
D. B. Special Appeal No. 1150 of 2000, D/- 29-11-2000 (Raj.), Reversed. (Paras 16, 20)
Cases Referred : Chronological Paras
2006 AIR SCW 1025 : 2006 Lab IC 1284 : 2006 (2) AIR Jhar R 321 (Ref.)19
@page-SC740

1999 Lab IC 2197 (Bom) 14


1997 AIR SCW 3747 : AIR 1997 SC 3828 : 1998 Lab IC 100 (Ref.) 18
AIR 1989 SC 1933 17
AIR 1977 SC 552 : 1977 Tax LR 149 (Ref.) 13
AIR 1974 SC 1 : 1974 Lab IC 1 (Ref.) 18
AIR 1971 SC 1193 (Ref.) 12
AIR 1965 SC 1970 17
AIR 1951 SC 128 : 1951 Cri LJ 860 (Ref) 17
AIR 1927 PC 242 17
(1886) 31 Ch D 402 17
Dr. Manish Singhvi, P. V. Yogeswaran and Ashok K. Mahajan, for Appellant; S. Wasim A.
Qadri, D. - S. - Mahra and B. V. Balaram Das, for Respondent.
* D. B. Special Appeal No. 1150 of 2000, D/- 29-11-2000 (Raj.)
Judgement
Dr. ARIJIT PASAYAT, J. - :- Challenge in this appeal is to the judgment rendered by a
Division Bench of the Rajasthan High Court at Jodhpur dismissing the Special Appeal
filed by the appellant. Challenge in the Special Appeal was to the judgment of a learned
Single Judge whereby the writ petition filed by the appellant was dismissed upholding the
decision of the Regional Provident Fund Commissioner (in short the 'Commissioner'). It
was held that Section 16(1)(d) of the Employees' Provident Funds Act, 1952 (hereinafter
referred to as the 'Act') was omitted from the statute by Act No.10 of 1998 with
retrospective effect i.e. from 22.9.1997. In other words, it was held that the infancy
protection shall not be available to the appellant factory after 22.9.1997.
2. The factual scenario lies into a very narrow compass. Appellant started production on
1.9.1995 and according to it, it was entitled to benefit under Section 16(1)(d) of the Act
from that day. From August, 1998 the appellant started to comply with the provisions of
the Act as the three year fledging period as envisaged under Section 16(1)(d) of the Act
came to an end. On 26.3.1999 enquiry under Section 7A of the Act was initiated to secure
the compliance of the Act from September, 1995 to July, 1998. By order dated 27.7.2000
the Commissioner recorded a specific finding that the company was a new unit and was
eligible for exemption under Section 16(1)(d) of the Act but since it was effaced from the
statute from 22.9.1997 the benefit was available till that date and not thereafter. The writ
petition filed was dismissed by the learned Single Judge, and so was the special appeal.
3. In support of the appeal learned counsel for the appellant submitted that the view of the
High Court is untenable and even if retrospective effect was given the same was to not in
any way affect the entitlement of the appellant.
4. Learned counsel for the respondent on the other hand supported the orders of the
Commissioner and the High Court.
5. The position of Section 16 at different points of time can be noticed. Section - 16 as
originally enacted read as follows - :
"16. Act not to apply to factories belonging to Government or local authority and also to
infant factories.
This Act shall not apply to-
(a) any factory belonging to the government or a local authority, and
(b) any other factory established whether before or after the commencement, of this Act
unless three years have elapsed from its establishment.
6. Section 16 was amended by the Employees' Provident Funds (Amendment) Act, 1958
and sub-section (1) of Section 16 of the Principal Act was substituted as under:
"(1) This Act shall not apply to any establishment until the expiry of three years from the
date on which the establishment is, or has been set up.
Explanation - :- For the removal of doubts it is hereby declared that an establishment
shall not be deemed to be newly set up merely by reason of a change in its location."
7. Section 16(1) was once again amended by the Employees' Provident Funds
(Amendment) Act, 1960 and sub-section (1) of Section 16 was substituted as under:
"(1) This Act shall not apply - :
(a) to any establishment registered under the Co-operative Societies Act, 1912, or under
any other law for the time being in force in any State relating to Co-operative Societies,
employing less than fifty persons and working without the aid of power; or
(b) to any other establishment employing fifty or more persons or twenty or more but less
than fifty persons until the expiry of three years in the case of the former and five years in
the case of the latter, from the date on which the establishment is, or has been, set up.
Explanation - :- For the removal of doubts, it is hereby declared that an
@page-SC741
establishment shall not be deemed to be newly set up merely by reason of a change in its
location".
8. Section 16 was further amended by the Employees' Provident Funds and
Miscellaneous Provisions (Amendment) Act, 1988 with effect from 1.8.1988, and Clause
(b) of sub-section (1) of Section 16 was substituted by clauses (b), (c) and (d) and the said
amendment to Section 16 is as under - :
"(b) to any other establishment belonging to or under the control of the Central
Government or the State Government and whose employees are entitled to the benefit of
contributory provident fund or old age pension in accordance with any scheme or rule
framed by the Central Government or the State Government governing such benefit; or
(c) to any other establishment set up under any Central Provincial or State Act and whose
employees are entitled to the benefits of contributory provident fund or old age pension in
accordance with any scheme or rule framed under that Act governing such benefits; or
(d) to any other establishment newly set up, until the expiry of a period of three years
from the date on which such establishment is, or has been set up."
9. Thereafter, Section 16 was again amended by Employees' Provident Funds and
Miscellaneous Provisions (Amendment) Act, 1988, omitting clause (d) with explanation
in sub-section (1) of Section 16 with effect from 22.9.1997. (The said omission was
initially carried out by Ordinance No.17/1997 promulgated on 22.9.1997 followed by
Ordinance No.25/1997, dated 25.12.1997 and Ordinance No.8 of 1998, dated 23.4.1998
followed by Act 10 of 1998).
10. According to the appellants, the un-amended provisions as it stood after the
amendment in 1988 under clause (d), apply to their cases and they were entitled to the
protection regarding non-application of the Act for a period of 3 years from the date on
which such establishment was set up. According to the High Court, as clause (d) was
deleted with effect from 22.9.1997, the Act had application to every establishment and no
exemption or 'infancy period' whatsoever was available from 22.9.1997.
11. The crucial question, therefore, is the effect of the amendment on the existing rights.
12

. In Jayantilal Amratlal v. Union of India and others (AIR 1971 SC 1193), it has been laid
down as under - : (Para 8)

"In order to see whether the rights and liabilities under the repealed law have been put to
an end by the new enactment, the proper approach is not to enquire if the new enactment
has by its new provisions kept alive the rights and liabilities under the repealed law but
whether it has taken away those rights and liabilities. The absence of a saving clause in a
new enactment preserving the rights and liabilities under the repeated law is neither
material nor decisive of the question."
13

. In Govinddas and others v. Income Tax Officer and another (AIR 1977 SC 552), it was
laid down that - : (Para 10)

"Now it is well settled rule of interpretation hallowed by time and sanctified by judicial
decisions that unless the terms of a statute expressly so provide or necessarily require it,
retrospective operation should not be given to a statute so as to take away or impair an
existing right or create a new obligation or impose a new liability otherwise than as
regards matters of procedure. The general-rule as stated by HALSBURY in Vol. 36 of the
LAWS OF ENGLAND (3rd Edn,) and reiterated in several decisions of this Court as well
as English Courts is that all statutes other than those which are merely declaratory or
which relate only to matters of procedure or of evidence are prima facie prospective and
retrospective operation should not be given to a statute so as to affect, alter or destroy an
existing right or create a new liability or obligation unless that effect cannot be avoided
without doing violence to the language of the enactment. If the enactment is expressed in
language which is fairly capable of either interpretation, it ought to be construed as
prospective only."
14. A Division Bench of Bombay High Court while considering the earlier amendment to
Section 16(1)(d) curtailing the infancy period from 5 years to 3 years, held thus, in Magic
Wash Industries (P) Ltd. v. Assistant Provident Fund Commissioner, Panaji and Anr.
(1999 Lab IC 2197) - :
"There is no doubt that the vested rights or benefits under the legislation could be
retrospectively taken away by legislation, but then the statute taking away such rights or
benefits must expressly reflect its intention
@page-SC742
to that effect. The infancy period prior to the amended provision Section 16(1)(d) was
five years in the case of establishments employing 20 to 50 workers and in the event this
infancy benefit was to be withdrawn, it was necessary that the intention of the Legislature
should have been clearly reflected in the amended provision itself that the rights and
benefits which had already accrued stood withdrawn. The amended clause 16(1)(d) came
on the statute book on June 2, 1988, when it was assented by the President of India but
the amended Section 16 was put into operation only with effect from August 1, 1988,
which empowered the Central Government to appoint different dates for the coming into
force of different provisions of the Act. We find it difficult in the circumstances, to
conclude that the intention of the Legislature was to take away the benefit of infancy
period which had already accrued to the existing establishments and this benefit has not
been expressly taken away or by implication by the amended provision Section 16(1)(d).
In the circumstances, we are of the opinion that the infancy period benefit of the
petitioner for a period of five years with effect from May 26, 1986, is not taken away by
the amended provision Section 16(1)(d) of the Act; and the petitioner could continue to
enjoy the said infancy benefit for a period of five years till May, 1991. Therefore, the
demand made by respondent 1 for the period up to May, 1991, has to be quashed. The
petitioners are complying with the provisions of the Act with effect from June, 1991."
15. The matter can be looked at from another angle. Section 6 of the General Clauses Act,
1897 (in short 'General Clauses Act') deals with effect of repeal. The said provision so far
relevant reads as follows - :
"6. Effect of repeal.- Where this Act, or any (Central Act) or Regulation made after the
commencement of this Act, repeals any enactment hitherto made or hereafter to be made,
then, unless a different intention appears, the repeal shall not-
(a) revive anything not in force or existing at the time at which the repeal takes effect; or
(b) affect the previous operation of any enactment so repealed or anything duly done or
suffered thereunder; or
(c) affect any right, privilege, obligation or liability acquired, accrued or incurred under
any enactment so repealed; or
(d) affect any penalty, forfeiture or punishment incurred in respect of any offence
committed against any enactment so repealed; or
(e) affect any investigation, legal proceeding or remedy in respect of any such right,
privilege, obligation, liability, penalty, forfeiture or punishment as aforesaid;
and any such investigation, legal proceeding or remedy may be instituted, continued or
enforced, and any such penalty, forfeiture or punishment may be imposed as if the
repealing Act or Regulation had not been passed."
16. In terms of Clause (c) of Section 6 as quoted above, unless a different intention
appears the repeal shall not affect any right, privilege or liability acquired, accrued or
incurred under the enactment repealed. The effect of the amendment in the instant case is
the same.
17. It is a cardinal principle of construction that every statute is prima facie prospective
unless it is expressly or by necessary implication made to have retrospective operation
(See Keshvan Madhavan Memon v. State of Bombay AIR 1951 SC 128). But the rule in
general is applicable where the object of the statute is to affect vested rights or to impose
new burdens or to impair existing obligations. Unless there are words in the statute
sufficient to show the intention of the Legislature to affect existing rights, it is deemed to
be prospective only 'nova constitutio futuris formam imponere debet non praeteritis'. In
the words of LORD BLANESBURG, "provisions which touch a right in existence at the
passing of the statute are not to be applied retrospectively in the absence of express
enactment or necessary intendment." (See Delhi Cloth Mills and General Co. Ltd. v. CIT,
Delhi, AIR 1927 PC 242). "Every statute, it has been said", observed LOPES, L.J.,
"which takes away or impairs vested rights acquired under existing laws, or creates a new
obligation or imposes a new duty, or attaches a new disability in respect of transactions
already past, must be presumed to be intended not to have a retrospective effect."(See
Amireddi Raja Gopala Rao v. Amireddi Sitharamamma, AIR 1965 SC 1970). As a logical
corollary of the general rule, that retrospective operation is not taken to be intended
unless that intention is manifested
@page-SC743
by express words or necessary implication, there is a subordinate rule to the effect that a
statute or a section in it is not to be construed so as to have larger retrospective operation
than its language renders necessary. (See Reid v. Reid, (1886) 31 Ch D 402). In other
words close attention must be paid to the language of the statutory provision for
determining the scope of the retrospectivity intended by Parliament. (See Union of India
v. Raghubir Singh (AIR 1989 SC 1933). The above position has been highlighted in
"Principles of Statutory Interpretation" by Justice G.P. Singh. (Tenth Edition, 2006) at PP.
474 and 475)
18

. In The State of Jammu and Kashmir v. Shri Triloki Nath Khosa and others (1974 (1)
SCC 19) and in Chairman, Railway Board and Ors. v. C.R. Rangadhamaiah and Ors.
(1997 (6) SCC 623), this Court held that provision which operates to affect only the
future rights without affecting the benefits or rights which have already accrued or
enjoyed, till the deletion, is not retrospective in operation. AIR 1974 SC 1
1997 AIR SCW 3747

19

. The above position was highlighted by this court in S.L. Srinivasa Jute Twine Mills (P)
Ltd. v. Union of India and Anr. [2006 (2) SCC 740]. 2006 AIR SCW 1025
20. In view of the above position in law, the judgments of the Commissioner and the
High Court are indefensible and are set aside. The appellant shall be entitled to the
protection for the period of three years starting from the date the establishment was set up
irrespective of the repeal of the provision for such infancy protection.
21. Appeal is allowed. No costs.
Appeal allowed.
AIR 2008 SUPREME COURT 743 "Harpal Singh v. State of Punjab"
Coram : 2 G. P. MATHUR AND G. S. SINGHVI, JJ.
Criminal Appeal No. 548 of 2007, D/- 4 -12 -2007.
Harpal Singh v. State of Punjab.
Terrorist and Disruptive Activities (Prevention) Act (28 of 1987), S.12, S.18, S.20A (as
inserted by Act 43 of 1993) - Explosive Substances Act (6 of 1908), S.5 - TERRORIST
AND DISRUPTIVE ACTIVITIES - EXPLOSIVE - COGNIZANCE OF OFFENCE -
Cognizance of offence - Power of Designated Courts under TADA - Accused charge-
sheeted under TADA Act and Explosive Substances Act - Sanction of Competent
Authority under TADA Act was not obtained - Designated Court being debarred from
taking cognizance of offence under TADA Act, it could not have tried any offence under
any other Acts - Conviction and sentence of accused under Explosive Substances Act are,
therefore, liable to be set aside.
AIR 1990 SC 1962; 1997 AIR SCW 3565, Relied on. (Paras 12, 13)
Cases Referred : Chronological Paras
1997 AIR SCW 3565 : AIR 1997 SC 3475 : 1997 Cri LJ 4086 (Rel. on) 11
AIR 1990 SC 1962 : 1990 Cri LJ 1869 (Rel. on) 8
Sushil Kumar, Sr. Advocate, Sanjay Jain, Anmol Thakral, Vinay Arora, Mukesh Kumar
and Sudarshan Singh Rawat with him, for Appellant; Kuldip Singh, for Respondent.
Judgement
G. P. MATHUR, J. - :-This Appeal has been preferred under Section 19 of the Terrorist
and Disruptive Activities (Prevention) Act, 1987 against the judgment and order dated
16.3.2007 of Designated Court, Kapurthala at Jalandhar in TADA Sessions Case No. 4 of
2006 by which the appellant has been convicted under Section 5 of the Explosive
Substances Act, 1908 and has been sentenced to 5 years' R.I. and a fine of Rs.1,000/-.
2. The case of the prosecution, in brief, is that on 12.3.1992 Kamaljit Singh, SHO,
Santokh Singh, SI and some other police personnel were going from village Kukar Pind
to village Raipur in connection with investigation of a case bearing FIR No. 31 under
Section 302/34, IPC, Section 25 of Arms Act and Sections 3, 4 and 5 of Terrorist and
Disruptive Activities (Prevention) Act, 1987 (hereinafter referred to as 'TADA'). When
they reached on Byen Bridge in village Kukar Pind, they saw a person coming on foot.
On seeing the police party he tried to run away but he was apprehended after a chase and
on inquiry he disclosed his name as Harpal Singh (appellant in this appeal). On his
personal search explosive powder wrapped in a glazed paper was recovered from the
"jhola" (bag) which he was having in his right hand. The bag contained one kilogram
explosive powder which was taken into possession. A ruka was sent to the police station
on the basis of which FIR was registered against the appellant.
3. After investigation and receipt of the sanction and report of the Forensic Science
@page-SC744
Laboratory charge-sheet was submitted in the court on 24.2.1994 for prosecution of the
appellant under Sections 4, 5, and 9B(b) of the Explosives Act, 1884. There was no
mention of any offence under TADA or under the Explosive Substances Act, 1908. The
charge-sheet was submitted in the Designated Court which took cognizance of the
offence and proceeded with the trial of the appellant. Ultimately the Designated Court
acquitted the appellant for the offences under TADA and the Explosives Act, 1884, but
convicted him only under Section 5 of the Explosive Substances Act, 1908 and sentenced
him to 5 years' R.I. and a fine of Rs. - 1,000/?.
4. Shri Sushil Kumar, learned senior counsel for the appellant, has submitted that the case
against the appellant is not established from the evidence adduced by the prosecution but
instead of going into the facts and appraisal of evidence the appeal can be allowed on a
legal ground.
5. Part III of TADA deals with Designated Courts. Sub-section (1) of Section 9 of TADA
provides that the Central Government or a State Government may, by notification in the
Official Gazette, constitute one or more Designated Courts for such area or areas, or for
such case or class or group of case as may be specified in the notification. Sub-section (1)
of Section 11 of TADA lays down that notwithstanding anything contained in the Code of
Criminal Procedure, every offence punishable under any provision of this Act or any rule
made thereunder shall be triable only by the Designated Court within whose local
jurisdiction it was committed or, as the case may be, by the Designated Court constituted
for trying such offence under sub-section (1) of Section 9. Sections 12 and 18 of TADA
read as under - :-
"12. Power of Designated Courts with respect to other offences.- (1) When trying any
offence, a Designated Court may also try any other offence with which the accused may,
under the Code, be charged at the same trial if the offence is connected with such other
offence.
(2) If, in the course of any trial under this Act, of any offence, it is found that the accused
person has committed any other offence under this Act or any rule made thereunder or
under any other law, the Designated Court may convict such person of such other offence
and pass any sentence authorised by this Act or such rule or, as the case may be, such
other law, for the punishment thereof."
"18. Power to transfer cases to regular courts.- Where, after taking cognizance of any
offence, a Designated Court is of opinion that the offence is not triable by it, shall,
notwithstanding that it had no jurisdiction to try such offence, transfer the case for the
trial of such offence to any court having jurisdiction under the Code and the court to
which the case is transferred may proceed with the trial of the offence as if it had taken
cognizance of the offence."
By Act No. 43 of 1993 Section 20-A was introduced in TADA with effect from 22.5.1993
and the said section reads as under - :-
"20-A. Cognizance of offence.- (1) Notwithstanding anything contained in the Code, no
information about the commission of an offence under this Act shall be recorded by the
police without the prior approval of the District Superintendent of Police.
(2) No court shall take cognizance of any offence under this Act without the previous
sanction of the Inspector-General of Police, or as the case may be, the Commissioner of
Police."
Therefore, with effect from 22.5.1993, in view of sub-section (1) of Section 20-A, no FIR
about the commission of an offence under TADA can be recorded by the police without
prior approval of the District Superintendent of Police. Similarly on account of sub-
section (2) of Section 20-A no court can take cognizance of any offence under TADA
without the previous sanction of the Inspector General of Police, or as the case may be,
the Commissioner of Police. The effect of this amendment is that the Designated Court is
debarred from taking cognizance of any offence under TADA without the previous
sanction of the Inspector General of Police or, as the case may be, the Commissioner of
Police.
6. As mentioned earlier, the alleged recovery of the incriminating article from the
appellant took place on 12.3.1992 and the case was registered under Sections 4 and 5 of
the Explosives Act, 1884. The police, after investigation, submitted charge-sheet before
the Designated Court on 24.2.1994. In the charge-sheet there was no reference to any
case under TADA or under the Explosive Substances Act, 1908 against the appellant. The
appellant was granted bail
@page-SC745
in the case under the Explosives Act on 1.7.1992. Thereafter he went away to USA and
applied for political asylum. He was declared as absconder on 20.1.1995. The US
authorities deported him to India in 2006. Thereafter the police submitted supplementary
charge-sheet against the appellant on 29.5.2006 for his prosecution under TADA and the
Explosive Substances Act. The Designated Court thereafter tried the appellant for
offences under TADA besides Sections 4 and 5 of the Explosives Act and also under
Sections 4 and 5 of the Explosive Substances Act.
7. The important feature which is to be noted is that the prosecution did not obtain
sanction of the Inspector General of Police or of the Commissioner of Police for
prosecution of the appellant under TADA at any stage as is required by Section 20-A(2)
of TADA. The trial of the appellant before the Designated Court proceeded without the
sanction of the Inspector General of Police or the Commissioner of Police. In absence of
previous sanction the Designated Court had no jurisdiction to take cognizance of the
offence or to proceed with the trial of the appellant under TADA.
8

. The Designated Court, while trying an offence under TADA, is undoubtedly empowered
to try any other offence with which the accused may, under the Code of Criminal
Procedure, be charged at the same trial if the offence is connected with such other offence
in view of Section 12 of TADA and may convict such person of such other offence and
may pass any sentence authorized by TADA or by such other law for the punishment
thereof. But for application of Section 12 it is absolutely essential that the Designated
Court should be trying an offence under TADA. If the Designated Court is not trying an
offence under TADA it will have no jurisdiction to try any other offence. Section 18 also
points out the same situation which says that where, after taking cognizance of any
offence, a Designated Court is of opinion that the offence is not triable by it, shall,
notwithstanding that it had no jurisdiction to try such offence, transfer the case for the
trial of such offence to any court having jurisdiction under the Code of Criminal
Procedure. Thus the Designated Court gets the jurisdiction to try any other offence only if
it has the jurisdiction and is trying an offence under TADA. In Niranjan Singh Karam
Singh Punjabi vs. Jitendra Bhimraj Bijja and others, AIR 1990 SC 1962, it was observed
as under - :- Para 12 of AIR

"Section 12(1) no doubt empowers the Designated Court to try any offence punishable
under any other statute along with the offence punishable under the Act if the former is
connected with the latter. That, however, does not mean that even when the Designated
Court comes to the conclusion that there exists no sufficient ground for framing a charge
against the accused under S. 3(1) it must proceed to try the accused for the commission of
offences under other statutes. That would tantamount to usurping jurisdiction. Section 18,
therefore, in terms provides that where after taking cognizance of any offence the
Designated Court is of the opinion that the offence is not triable by it, it shall,
notwithstanding that it has no jurisdiction to try such offence, transfer the case for the
trial of such offence to any Court having jurisdiction under the Code."
9. At this stage it will be useful to refer to the dictionary meaning of the word
'Jurisdiction' - :-
Black's Law Dictionary : "Court's power to decide a case or issue a decree".
Words and Phrases - Legally defined - Third Edition (p.497) - : "By 'jurisdiction' is meant
the authority which a court has to decide matters that are litigated before it or to take
cognizance of matters presented in a formal way for its decision. The limits of this
authority are imposed by the statute, charter, or commission under which the court is
constituted, and may be extended or restricted by similar means. If no restriction or limit
is imposed the jurisdiction is said to be unlimited. A limitation may be either as to the
kind and nature of the actions and matters of which the particular court has cognizance,
or as to the area over which the jurisdiction extends."
Law Lexicon by P. Ramanatha Aiyar - 2nd Edn. Reprint 2000 : "An authority or power,
which a man hath to do justice in causes of complaint brought before him (Tomlin's Law
Dic.). The power to hear and determine the particular case involved; the power of a Court
or a judge to entertain an action, petition, or other proceeding; the legal power of hearing
and determining controversies. As applied to a particular claim or controversy,
jurisdiction is the power to
@page-SC746
hear and determine the controversy."
Jurisdiction, therefore, means the authority or power to entertain, hear and decide a case
and to do justice in the case and determine the controversy. In absence of jurisdiction the
court has no power to hear and decide the matter and the order passed by it would be a
nullity.
10. As mentioned earlier, in the first charge-sheet which was filed on 24.2.1994 there was
no mention of TADA at all. It was in the supplementary charge-sheet filed on 29.5.2006
that the prosecution introduced the offence under TADA. But there was no sanction of the
Inspector General of Police or of the Commissioner of Police as required under Section
20-A(2) of TADA and, therefore, the Designated Court had no jurisdiction to take
cognizance of the offence. Since the Designated Court lacked inherent jurisdiction to try
the offence under TADA it could not have tried the appellant even for offences under the
Explosive Substances Act, 1908 or the Explosives Act, 1884. Thus the conviction of the
appellant under Section 5 of the Explosive Substances Act, 1908 is illegal.
11
. The aforesaid view has also been taken by this Court in Rambhai Nathabhai Gadhvi and
others vs. State of Gujarat (1997) 7 SCC 744 and para 8 of the report is reproduced below
- :- 1997 AIR SCW 3565

"8. Taking cognizance is the act which the Designated Court has to perform and granting
sanction is an act which the sanctioning authority has to perform. Latter is a condition
precedent for the former. Sanction contemplated in the sub-section is the permission to
prosecute a particular person for the offence or offences under TADA. Sanction is not
granted to the Designated Court to take cognizance of the offence, but it is granted to the
prosecuting agency to approach the court concerned for enabling it to take cognizance of
the offence and to proceed to trial against the persons arraigned in the report. Thus a valid
sanction is sine qua non for enabling the prosecuting agency to approach the court in
order to enable the court to take cognizance of the offence under TADA as disclosed in
the report. The corollary is that, if there was no valid sanction the Designated Court gets
no jurisdiction to try a case against any person mentioned in the report as the court is
forbidden from taking cognizance of the offence without such sanction. If the Designated
Court has taken cognizance of the offence without a valid sanction, such action is without
jurisdiction and any proceedings adopted thereunder will also be without jurisdiction."
12. In view of the discussion made above there cannot be any escape from the conclusion
that the Designated Court had no jurisdiction to try and convict the appellant under the
Explosive Substances Act, 1908 in view of the fact that it could not have taken
cognizance of the offence under TADA for lack of sanction by the competent authority
under Section 20-A(2) of TADA. In view of the fact that the Designated Court could not
try the offence under TADA being debarred from taking cognizance thereof on account of
want of sanction by the competent authority under the mandatory provisions of Section
20-A(2), it could not try any offence under any other Act as well.
13. The appeal is accordingly allowed and the conviction of the appellant under Section 5
of the Explosive Substances Act and the sentence imposed thereunder are set aside. The
appellant shall be released forthwith unless wanted in some other case.
Appeal allowed.
AIR 2008 SUPREME COURT 746 "Anita Enterprises, M/s. v. Belfer Co-op. Housing
Society Ltd."
(From : Bombay)*
Coram : 2 B. N. AGRAWAL AND PRAKASH PRABHAKAR NAOLEKAR, JJ.
Civil Appeal Nos. 2990-2991 of 2005 with C. A. Nos. 2992-2995 of 2005, D/- 14 -11
-2007.
M/s. Anita Enterprises and Anr. v. Belfer Co-op. Housing Society Ltd. and Ors.
(A) Maharashtra Co-operative Societies Act (24 of 1961), S.29 - Maharashtra Co-
operative Societies Rules (1961), R.10(1)(b), R.28 - Bombay Rents, Hotel and Lodging
House Rates Control Act (57 of 1947), S.5(11) - CO-OPERATIVE SOCIETIES -
HOUSES AND RENTS - TENANCY - Tenant co-partnership housing society - Member
- Is not tenant of society - His status is higher than a tenant.
The status of a member in the case of tenant co-partnership housing society is not that of
a tenant within the meaning of S. 5(11) of the Rent Act 1947, there is therefore no
relationship of landlord and tenant
@page-SC747
between the Society and the member.(Para 28)
The status of a member in a tenant co-partnership housing society is very peculiar. The
ownership of the land and building both vests in the society and the member has, for all
practical purposes, right of occupation in perpetuity after the full value of the land and
building and interest accrued thereon have been paid by him. Although de jure he is not
owner of the flat allotted to him, but, in fact, he enjoys almost all the rights which an
owner enjoys, which includes right to transfer in case he fulfils the two pre-conditions,
namely, he occupies the property for a period of one year and the transfer is made in
favour of a person who is already a member or a person whose application for
membership has been accepted by the society or whose appeal under S. 23 of the
Societies Act 1961 has been allowed by the Registrar or to a person who is deemed to be
a member under sub-sec. (1A) of S. 23 of the Societies Act 1961. If it is held that the
society is a landlord and the member is a tenant within the meaning of the Rent Act, in
that event the society can evict the member by filing a suit for eviction if it requires the
premises for its bona fide need, but under the Societies Act, it can evict the member only
as a consequence of his expulsion from the membership and neither under the Societies
Act nor Rules framed thereunder nor Bye-Laws nor Regulations there is any provision
that a Society can evict a member in case it has got bona fide need of the same. The said
interpretation would thus be contrary to the object of the Societies Act. (Paras 27, 28)
(B) Maharashtra Co-operative Societies Act (24 of 1961), S.29 - CO-OPERATIVE
SOCIETIES - TENANCY - Tenant co-partnership housing society - Restriction on
transfer of property allotted to member for his own use - Provision is mandatory.
In a case of tenant co-partnership society the ownership of the land and the building both
vest in the society and the premises is allotted to the member for his occupation only and
not for the purpose of occupation of anybody else. That is the object of the Societies Act
1961 as would appear from bye-law 2, i.e., 'for use of the member', meaning thereby his
own use. Under bye-law 64(a) a member is restrained from parting with possession of the
flat without permission of the society which shall be granted upon filing application, by
an intending transferee, for grant of membership by admitting him as a nominal member.
In view of the language of S. - 29(2), which is in the nature of injunction upon the right
of a member to transfer unless the twin conditions are fulfilled, and the purpose for which
the house is allotted to a member, i.e., for his self occupation, it cannot be said in any
manner that the said provision is directory as giving such an interpretation would
frustrate object of the Societies Act whereunder a flat is allotted to a member for his self-
occupation as would appear from the Societies Act, Rules, bye-Laws and Regulations.
(Para 30)
(C) Maharashtra Co-operative Societies Act (24 of 1961), S.29 - Bombay Rents, Hotel
and Lodging House Rates Control Act (57 of 1947), S.28 - CO-OPERATIVE
SOCIETIES - HOUSES AND RENTS - TENANCY - Tenant co-partnership housing
society - Member inducting third person in his allotted accommodation - Such transfer
being against mandatory provisions of S. - 29 of 1961 Act - Relationship of landlord and
tenant does not get established between member and third person. (Para 33)
(D) Maharashtra Co-operative Societies Act (24 of 1961), S.91, S.29(2) - CO-
OPERATIVE SOCIETIES - TENANCY - ALLOTMENT OF PREMISES - Co-operative
court - Jurisdiction - Dispute touching business of society - Member of tenant co-
partnership housing society - Creating tenancy rights in respect of his allotted
accommodation - Question as to legality of such tenancy - Can be raised/decided by co-
operative Court.
The question regarding legality or otherwise of the creation of tenancy right by the
member of tenant co-partnership society which amounts to transfer of interest of a
member in the property of the Society, can be decided by raising a dispute before the Co-
operative Court. The induction by a member of non-member is prohibited by S. 29. The
transaction is not void but only voidable. Ordinarily in case of a transaction which is
voidable and not void, if an aggrieved party intends to avoid the same it is required to
obtain a decree from a competent civil Court by filing a properly constituted suit. But in a
case like the present one, if a party is first asked to obtain a decree from a competent civil
Court and only thereafter raise a dispute which is undisputedly touching upon the
business
@page-SC748
of the society under S. 91 of the Societies Act, the same would frustrate the provisions of
S. 91 and the intention of the Legislature in incorporating a cheap and expeditious
remedy by referring the same to a Court constituted under the Societies Act instead of
throwing a party to cumbersome procedure of moving a civil Court. Obtaining of
declaration from a competent civil court that relationship of landlord and tenant was not,
duly created and, therefore, the induction of a person by the member as tenant was
invalid, before raising a dispute under S. 91 of the Societies Act was not necessary.
(Paras 35, 36)
Cases Referred : Chronological Paras
AIR 1990 SC 1563 (Rel. on) (Pt. A) 25, 26, 28, 31
AIR 1986 SC 1194 (Disting) (Pt. D) 38
AIR 1975 SC 1470 (Disting.) 31, 32
D. M. Nargolkar, for Appellant; U. U. Lalit, Sr. Advocate, Ravindra Keshavrao Adsure,
Gaurav Agarwal, Prashant Kumar, V. N. Raghupathy, for Respondents.
* L.P.A. No. 217 of 2001 and W. P. No. 2253 of 2001, D/- 25-8-2004 and 5-7-2001
(Bom)
Judgement
1. B. N. AGRAWAL, J. :-These appeals by special leave have been filed against separate
orders rendered by a Division Bench of the Bombay High Court in Letters Patent Appeals
whereby the same have been dismissed as not maintainable, thereby confirming the
common judgment rendered by a learned Single Judge of the High Court in three writ
petitions filed under Article 227 of the Constitution of India [hereinafter referred to as
'the Constitution'].
2. The facts, in brief, are that the Belfer Co-operative Housing Society Limited, Bandra
[West], Mumbai, respondent No. 1 in Civil Appeal Nos. 2990-2991 of 2005, [hereinafter
referred to as 'the Society'], which was a tenant co-partnership housing society, held both
lands and flats constructed thereon and Dr. Gopal Mahadeo Dhadphale, respondent No. 2
in the said appeals [hereinafter referred to as 'the member'] was admitted as member of
the Society in the year 1962 and flat No. 4 on the ground floor was allotted to him. On
3.6.1982, the member inducted M/s. Anita Enterprises, appellant No. 1 in the said
appeals, in room No. 2 of the said flat on a monthly rental of Rs. 1000/- and on 3.10.1983
the appellant aforementioned was inducted in room No. 3 as well on a monthly rental of
Rs. 750/-. The member thereafter inducted M/s. Anita Medical Systems Pvt. Ltd.,
appellant No. 2 in the said appeals, in room No. 1 of the flat in question on a monthly
rental of Rs. 1000/- which was subsequently enhanced to Rs. 1500/- per month and both
the appellants were put in possession of the aforesaid premises. The appellants paid rent
upto the month of December, 1986 and as the member refused to accept the rental from
January, 1987, the rental was sent to him by cheques under registered post, but the same
was not accepted.
3. Thereupon, the appellants were asked to vacate the premises in question which
necessitated filing of two separate suits by them in the year 1987 before the Small Cause
Court for a declaration that they were tenants with regard to the aforesaid premises of
which they were in occupation and for perpetual injunction restraining the member from
interfering in any manner with their possession over the premises in question in which
suits only the member was made party and not the Society. The member in the said suits
contested the claim of the appellants and both the suits filed by the appellants were
dismissed by the trial court upon a finding that the appellants were not inducted as
tenants in the suit premises. But on appeal being preferred to the appellate bench of the
Small Cause Court, the same were decreed and it was held that the appellants were
inducted as tenants in the premises in their occupation.
4. In the meantime, the Society raised a dispute in the year 1989 before the Co-operative
Court under Section 91 of the Maharashtra Co-operative Societies Act, 1960 [hereinafter
referred to as 'the Societies Act'] praying therein that the appellants be evicted from the
premises in their occupation and the member be directed to occupy the same as,
according to the Society, the member had parted with possession of the premises in
question in favour of the appellants which was not permissible in law. The said case was
contested by the appellants in which the member and the appellants entered appearance
and all contested the claim of the Society. The Co-operative Court by its award decided
the dispute in favour of the Society, passed an order of eviction against the appellants and
directed the member to occupy the premises. The said order was upheld in appeal.
5. Thereafter, before the High Court three writ petitions were filed - one by the
@page-SC749
appellants against the aforesaid order passed by the appellate court upholding order
passed by the Co-operative Court and the other two writ petitions by the member against
the order passed by the appellate bench of the Small Cause Court whereby aforesaid
declaratory suits filed by the appellants were decreed. A learned Single Judge of the High
Court, by a common judgment, dismissed the writ petition filed by the appellants
whereby order passed by the Co-operative Court against the member and the appellants,
which was upheld in appeal, has been confirmed and allowed the writ petitions filed by
the member, set aside judgment and order passed by the appellate bench of Small Cause
Court and restored that of the trial court whereby declaratory suits filed by the appellants
were dismissed. The said judgment has been upheld by Division Bench of the High Court
by dismissing the Letters Patent Appeals on the ground that the same were not
maintainable in view of the fact that the writ petitions were filed under Article 227 of the
Constitution. Hence these appeals by special leave.
6. Undisputed facts are stated hereinafter. The Society was a tenant co-partnership
housing Society, the land and the structures standing thereon, which include the premises
in question, were held by it, respondent No. 2 was admitted as its member, allotted flat
No. 4 and put in possession thereof. The appellants are in occupation of the premises in
question since the date of their induction aforementioned and the member remained in
possession of the premises for a period of more than one year before induction of the
appellants therein. Induction of appellants as tenants by the member amounted to transfer
of interest by the member in the premises in question, which was property of the Society,
and the appellants were neither members of the Society nor can be said to be persons
whose application for membership had been accepted by the Society or persons whose
appeal under Section 23 of the Societies Act had been allowed by the Registrar or persons
who were deemed to be members under Section (1A) of Section 23 of the Societies Act.
The appellants were inducted without the consent of either the Society or its Managing
Committee and never admitted as nominal members of the Society.
7. Shri Shekhar Naphade, learned senior counsel appearing on behalf of the appellants in
support of the appeals, submitted that respondent No. 2 - in his capacity as member of the
tenant co-partnership housing society - has a possessory right in the premises in question
and the Society was only, by way of legal fiction, owner of the said premises. It was
further submitted that there was no relationship of landlord and tenant between the
Society and the member and there was such a relationship between the member and the
appellants, as such, the appellants were entitled to claim protection under the Bombay
Rents, Hotel and Lodging House Rates Control Act, 1947 [hereinafter referred to as 'the
Rent Act') and the proceeding under Section 91 of the Societies Act was not maintainable
in view of the bar incorporated under Section 28 of the Rent Act. According to him, the
Society was not justified in contending that there was relationship of landlord and tenant
between the Society and the member and consequently the appellants cannot be said to be
sub-tenants of the member as creation of sub-tenancy was forbidden under Section 15 of
the Rent Act unless there was contract to the contrary, which was not so in the case on
hand and, consequently such a sub-tenant cannot be treated to be a tenant within the
meaning of Section 5(11) of the Rent Act. It was also submitted that the tenancy right
could be created by the member as the transfer by him of his right in the premises was not
forbidden in law, therefore, the Society was not justified in contending that relationship
of landlord and tenant was not duly created inasmuch as even if there was restrictive right
of transfer and not absolute one if the tenancy was created in infraction of the same, the
transaction creating tenancy right in the appellants by the member cannot be said to be
void as such and if a party wanted to avoid the same, it was required to move a competent
civil court for a declaration that the same was invalid in law as the said transaction can, at
the highest, be said to be voidable and the said question cannot be examined by a Co-
operative Court purporting to act under Section 91 of the Societies Act.
8. On the other hand, Shri U.U. Lalit, learned senior counsel appearing on behalf of the
Society, submitted that the relationship between the Society and the member, as would
appear from the Bye-Laws of the Society as well as Regulations, was that of landlord and
tenant in respect of the
@page-SC750
premises held by the Society and the member purported to create right of a sub-tenant in
the appellants which was, in the absence of any contract to the contrary, forbidden by
Section 15 of the Rent Act, as such the appellants having not acquired the status of a
tenant within the meaning of the Rent Act, cannot claim protection thereunder from
eviction. Alternatively, it was submitted that even if it was treated that there existed no
relationship of landlord and tenant between the Society and the member and relationship
of landlord and tenant was created between the member and the appellants, the same was
not valid in law as it was not duly created in view of the fact that such a transaction being
in violation of the provisions of Section 29 of the Societies Act, was invalid as the
transfer made was, though entered into after completion of period of one year of
occupation of the member, to a non-member which was forbidden by law, as would
appear from the said provisions and the Bye-Laws of the Society and its legality or
otherwise could have been examined in a dispute raised under Section 91 of the Societies
Act. It was then submitted that asking the Society to first seek such a declaration from a
competent civil court and thereafter raise a dispute under Section 91 of the Societies Act
would frustrate the very object of the Societies Act. It was further submitted that in any
view of the matter, in the present case as the appellants had already filed suits before the
Small Cause Court for a declaration that their status was that of tenants under the Rent
Act, in which it was open to the Society to raise the question that the relationship of
landlord and tenant was not duly created, meaning thereby not in accordance with law but
contrary to law and for granting relief to the appellants therein the Court was called upon
to go into this question and decide the same. Learned counsel also submitted that as the
relationship of landlord and tenant was not duly created, the appellants could not claim
protection of the Rent Act and the petition under Section 91 of the Societies Act was
maintainable as the dispute raised was touching upon business of the Society.
9. In view of the rival submissions, the following questions fall for our consideration in
these appeals :-
1. Whether status of a member in a tenant co-partnership housing society is that of a
tenant or landlord within the meaning of the Rent Act and consequently there was any
relationship of landlord and tenant between the society and its member?
2. Whether purported status of the appellants, who were inducted by the member in the
premises in question was that of a tenant or sub-tenant within the meaning of Section
5(11) of the Rent Act and if it is held to be a tenant whether the relationship of landlord
and tenant between them was duly created so as to claim protection from eviction under
the Rent Act?
3. Whether the question regarding legality or otherwise of creation of tenancy right
between the appellants and the member of the Society could be adjudicated by the Small
Cause Court in suits filed by the appellants against member of the Society for declaration
that there was relationship of landlord and tenant between them and the High Court was
justified in restoring decree passed by the trial court to the effect that there was no
relationship of landlord and tenant between the appellants and member of the Society?
4. Whether the matter regarding legality or otherwise of creation of tenancy right between
the appellants and the member could be adjudicated by the Co-operative Court in dispute
raised under Section 91 of the Societies Act before the Co-operative Court or the Society
before raising any such dispute was required to obtain a declaratory decree from
competent civil court by filing a properly constituted suit before it?
10. In order to appreciate the points involved in these appeals, it would be useful to refer
to the relevant provisions of the Societies Act, Maharashtra Co-operative Societies Rules,
1961 [hereinafter referred to as 'the Rules'], Bye-Laws of the Society which were
registered with the Registrar, Co-operative Society, at the time of grant of registration to
it [hereinafter referred to as 'the Bye-Laws'], Regulations relating to tenancies to be
granted by the Society to members in respect of premises held by the Society contained
in Form A which are part of registered Bye-Laws of the Society [hereinafter referred to as
'the Regulations'] and the Rent Act which run thus :-
THE SOCIETIES ACT :
"Section 2. Definitions.- In this Act, unless the context otherwise requires,-
[(16) "housing society" "means a society, the object of which is to provide its
@page-SC751
members with open plots for housing, dwelling houses or flats; or if open plots, the
dwelling houses or flats are already acquired, to provide its members common amenities
and services];
(19)
(a.) "member" means a person joining in an application for the registration of a Co-
operative society which is subsequently registered, or a person duly admitted to
membership of a society after registration, and includes a nominal, associate or
sympathizer member;
* * * * *
(c.) "nominal member" means a person admitted to membership as such after registration
in accordance with the by-laws;
* * * * *"
"Section 23. Open membership.- (1) No society shall, without sufficient cause, refuse
admission to membership to any person duly qualified therefor under the provisions of
this Act and its by-laws.
[(1A) Where a society refuse to accept the application from an eligible person for
admission as a member, or the payment made by him in respect of membership, such
person may tender an application in such form as may be prescribed together with
payment in respect of membership, if any, to the Registrar, who shall forward the
application and the amount, if any so paid, to the society concerned within thirty days
from the date of receipt of such application and the amount; and thereupon if the society
fails to communicate any decision to the applicant within sixty days from the date of
receipt of such application and the amount by the society, the applicant shall be deemed
to have become a member of such society.] [If any question arises whether a person has
become a deemed member or otherwise, the same shall be decided by the Registrar after
giving a reasonable opportunity of being heard to all the concerned parties.]
(2) Any person aggrieved by the decision of a society, refusing him admission to its
membership, may appeal to the Registrar. [Every such appeal, as far as possible, be
disposed of by the Registrar within a period of three months from the date of its receipt - :
Provided that, where such appeal is not so disposed of within the said period of three
months, the Registrar shall record the reasons for the delay.]
(3) The decision of the Registrar in appeal, shall be final and the Registrar shall
communicate his decision to the parties within fifteen days from the date thereof.
[( 4) Without prejudice to the foregoing provisions of this section, in the case of agro-
processing societies or any other society for which a definite zone or an area of operation
is allotted by the State Government or the Registrar, it shall be obligatory on the part of
such society to admit, on an application made to it, every eligible person from that zone
or the area of operation, as the case may be, as a member of such society, unless such
person is already registered as a member of any other such society, in the same zone or
the area of operation.]"
"Section 29 - Restrictions on transfer or charge of share or interest .- (1) Subject to the
provisions of the last preceding section as to the maximum holding of shares and to any
rules made in this behalf, a transfer of, or charge on, the share or interest of a member in
the share capital of a society shall be subject to such conditions as may be prescribed.
(2) A member shall not transfer any share held by him or his interest in the capital or
property of any society, or any part thereof, unless-
(a) he has held such share or interest for not less than one year;
(b) the transfer is made to a member of the society or to a person whose application for
membership has been accepted [by the society, or to a person whose appeal under Section
23 of the Act has been allowed by the Registrar; or to a person who is deemed to be a
member under sub-section (1A) of-section 23.].
(3) Notwithstanding anything contained in sub-sections (1) and (2), where a member is
allowed to resign, or is expelled, or ceases to be a member on account of his being
disqualified by this Act or by the rules made thereunder or by the by-laws of the society,
the society may acquire the share or interest of such member in the share capital by
paying for it at the value determined in the manner prescribed provided that the total
payment of share capital of a society in any financial year for such purposes does not
exceed ten per cent of the paid-up share capital of the society on the last day of the
financial year immediately preceding.
Explanation -.[I]-The right to forfeit the
@page-SC752
share or interest of any expelled member in the share capital by virtue of any by-laws of
the society, shall not be affected by the aforesaid provision.
[Explanation II,-In this section, the expression "financial year" means the year ending on
the [31st day, of March] or, in the case of any society or class of societies the accounts of
which are with the previous sanction of the Registrar balanced on any other day, the year
ending on such day.]
(4) Where the State Government is a member of a society, the restrictions contained in
this section shall not apply to any transfer made by it of its share or interest in the capital
of the society; and that Government may, notwithstanding anything in this Act, withdraw
from the society its share capital at any time, after giving to the society notice thereof of
not less than three months".
"Section 31 - Share or interest not liable to attachment.- The share or interest of a
member in the capital of a society, or in the loan-stock issued by a housing society, or in
the funds raised by a society from its members by way of savings deposit, shall not be
liable to attachment or sale under any decree or order of a Court for or in respect of any
debt or liability incurred by the member; and accordingly, neither the Official Assignee
under the Presidency-Towns Insolvency Act, 1909, nor a Receiver under the Provincial
Insolvency Act, 1920, nor any such person or authority under any corresponding law for
the time being in force, shall be entitled to, or have any claim on, such share or interest."
"Section 47 - Prior claim of society.- (1) Notwithstanding anything in any other law for
the time being in force, but subject to any prior claim of Government in respect of land
revenue or any money recoverable as land revenue and to the provisions of sections 60
and 61 of the Code of Civil Procedure, 1908.
(a) any debt or outstanding demand, owing to a society by any member or past member
or deceased member, shall be a first charge,-
(i) upon the crops or other agricultural produce raised in whole or in part whether with or
without a loan taken from the society by such member or past member or deceased
member,-
(ii) upon any cattle, fodder for cattle, agricultural or industrial implements or machinery,
or raw materials for manufacture, or workshop, godown or place of business supplied, to
or purchased by such member or past member or deceased member, in whole or in part,
from any loan whether in money or goods made to him by the society, and
(iii) upon any movable property which may have been hypothecated, pledged or
otherwise mortgaged by a member with the society, and remaining in his custody; (b) any
outstanding demands or dues payable to a society by any member or past member or
deceased member, in respect of rent, shares, loans or purchase money or any other rights
or amounts payable to such society, shall be a first charge upon his interest in the
immovable property of the society,
Explanation.-The prior claim of Government in respect of dues other than land revenue,
shall be restricted for the purpose of sub-section (1) to the assets created by a member out
of the funds in respect of which the Government has a claim.
(2) No property or interest in property, which is subject to a charge under the foregoing
sub-section, shall be transferred in any manner without the previous permission of the
society; and such transfer shall be subject to such conditions, if any, as the society may
impose.
(3) Any transfer made in contravention of sub-section (2) shall be void.
(4) Notwithstanding anything contained in sub-sections (2) and (3), a society, which has
as one of its objects the disposal of the produce of its members, may provide in its bye-
laws, or may otherwise contract with its members,-
(a) that every such member shall dispose of his produce through the society, and
(b) that any member, who is found guilty of a breach of the bye-laws or of any such
contract, shall reimburse the society for any loss, determined in such manner as may be
specified in the bye-laws."
"Section 91 - Disputes .- (1) Notwithstanding [anything contained] in any other law for
the time being in force, any dispute touching the constitution, [elections of the committee
or its officers other than elections of committees of the specified societies including its
officer], conduct of general meetings, management or business of a society shall be
referred by any of the parties to the
@page-SC753
dispute, or by a federal society to which the society is affiliated or by a creditor of the
society, to the co-operative Court if both the parties thereto are one or other of the
following:-
(a) a society, its committee, any past committee, any past or present officer, any past or
present agent, any past or present servant or nominee, heir or legal representative of any
deceased officer, deceased agent or deceased servant of the society, or the Liquidator of
the society [or the official Assignee of a de-registered society].
(b) a member, past member of a person claiming through a member, past member of a
deceased member of society, or a society which is a member of the society [or a person
who claims to be a member of the society;]
(c) a person other than a member of the society, with whom the society, has any
transactions in respect of which any restrictions or regulations have been imposed, made
or prescribed under sections 43, 44 or 45, and any person claiming through such person;
(d) a surety of a member, past member or deceased member, or surety of a person other
than a member with whom the society has any transactions in respect of which
restrictions have been prescribed under section 45, whether such surety or person is or is
not a member of the society;
(e) any other society, or the Liquidator of such a society [or de-registered society or the
official Assignee of such a de-registered society].
[Provided that, an industrial dispute as defined in clause (k) of section 2 of the Industrial
Disputes Act, 1947 , or rejection of nomination paper at the election to a committee of
any society other than a notified society under section 73 -1 C or a society specified by or
under section 73-G, or refusal of admission to membership by a society to any person
qualified therefor [or any proceeding for the recovery of the amount as arrear of land
revenue on a certificate granted by the Registrar under sub-section (1) or (2) of section
101 or sub -section (1) of section 137 or the recovery proceeding of the Registrar or any
officer subordinate to him or an officer of society notified by the State Government, who
is empowered by the Registrar under sub-section (1) of section 156,] [or any orders,
decisions, awards and actions of the Registrar against which an appeal under section 152
or 152-A and revision under section 154 of the Act have been provided] shall not be
deemed to be a dispute for the purposes of this section.]
(3) Save as otherwise provided under [sub-section (2) to section 93], no Court shall have
jurisdiction to entertain any suit or other proceedings in respect of any dispute referred to
in sub-section (1).
Explanation 1.-A dispute between the Liquidator of a society [or an official Assignee of a
de-registered society] and [the members (including past members, or nominees, heirs or
legal representative or deceased members)] of the same society shall not be referred [to
the co-operative Court] under the provisions of sub-section (1).
Explanation 2.-For the purposes of this sub-section, a dispute shall include-
(i) a claim by or against a society for any debt or demand due to it from a member or due
from it to a member, past member or the nominee, heir or legal representative of a
deceased member, or servant for employee whether such a debt or demand be admitted or
not;
(ii) a claim by a surety for any sum or demand due to him from the principal borrower in
respect of a loan by a society and recovered from the surety owing to the default of the
principal borrower, whether such a sum or demand be admitted or not;
(iii) a claim by a society for any loss caused to it by a member, past member or deceased
member, by any officer, past officer or deceased officer, by any agent, past agent or
deceased agent, or by any servant, past servant, past servant or deceased servant, or by its
committee, past or present, whether such loss be admitted or not;
(iv) a refusal or failure by a member, past member or a nominee, heir or legal
representative of a deceased member, to deliver possession to a society of land or any
other asset resumed by it for breach of condition as the assignment."
"93. Transfer of disputes from one Co-operative Court to another and suspension of
proceedings in certain cases.-
* * * * *
(2) Notwithstanding anything contained in this Act, the Co-operative Court, on an
application made to it by any of the parties to the dispute, may, if it thinks fit suspend
@page-SC754
any proceedings in respect of any dispute, if the question at issue between a society and a
claimant or between different claimants, is one involving complicated questions of law
and fact, until the question has been tried by a regular suit instituted by one of the parties
or by the society. If any such suit is not instituted in a Civil Court within two months
from the date of the order of the Co-operative Court, shall continue the proceedings and
decide the dispute]"
[Emphasis Added]
THE RULES
"Rule 8. Matters in respect of which Registrar may direct society to make bye-laws or
society may make bye-laws.-
(1) The Registrar may require a society to make bye-laws in respect of all or any of the
following matters, that is to say.-
* * * * *
(c) the object of the society;
*****
(f) the privileges, rights, duties and liabilities of members including nominal, associate
and sympathizer members;
* * * * *
(m) the procedure for expulsion of members;
(2) A society may make bye-laws for all or any of the following matters, that is to say
* * * * *
(c) the conditions, if any, under which the transfer of share or interest of a member may
be permitted;"
"Rule 10. Classification and sub-classification of societies.- (1) After registration of a
society, the Registrar shall classify the society into one or other of the following classes
and sub-classes of societies prescribed below according to the principal object provided
in its bye-laws :

Class Sub-Class Examples of societies falling in the class or sub-class, as


the case may be
1 2 3
* * * *
5 Housing Society (a) Tenant Ownership Housing Society
(b) Tenant Co-partnership Housing Soci-ety
(c) Other Housing Societies Housing Societies where land is held either on leasehold or
free-hold basis by Societies and houses are owned or are to be owned by members.
Housing Societies which hold both land and buildings either on lease-hold or free-hold
basis and allot them to their members.
House Mortgage Societies and House Construction Societies.

"Rule 28. Expulsion of members.- Any member who has been persistently defaulting
payment of his dues or has been failing to comply with the provisions of the bye-laws
regarding sales of his produce through the society or other matters in connection with his
dealings with the society or who, in the opinion of the committee, has brought disrepute
to the society or has done other acts detrimental to the interest or proper working of the
society may, in accordance with the provisions of sub-section (1) of Section 35, be
expelled from the society. Expulsion from membership may involve forfeiture of shares
held by the member."
[Emphasis Added]
THE BYE-LAWS
"Bye-law 2.- The objects of the Society shall be :-
(a) To purchase plot No................... or to purchase building ..................................
constructed on Plot No. ..........................(referred to in the application for registration), or
any other plot or plots with the prior approval of the general meeting and of the Registrar
and to construct tenements on such plot or plots for the use of members;
*****
(f) To do all things necessary or expedient
@page-SC755
for the attainment of the objects specified in these bye-laws;"
"Bye-Law 7. All persons permanently residing in Bombay City and Suburban area or
who intend to settle down in Bombay City and Suburban area permanently and who have
signed the application for registration are original members. Other members shall be
admitted by the Committee. Every person on applying for membership shall deposit
Re.1/- as entrance fee and the value of at least five shares for which he shall receive a
copy of the bye-laws. Two adverse votes are sufficient to exclude an applicant. In case
where an application is refused, the deposit shall ordinarily be returned.
Note:- Resident is a person who resides in the house or tenement permanently and which
he does not leave for more than 4 months at a time."
"Bye-Law 12.- (1) A member shall be expelled from the Society by the vote of not less
than two-thirds of the members present and voting at a General Meeting of the Society on
a motion (which shall be final and conclusive) that in the opinion of the Meeting such
member has :
(a) been a persistent defaulter,
(b) willfully deceived the Society by false statements,
(c) been bankrupt or legally disabled,
(d) been criminally convicted of an offence involving moral turpitude,
(e) intentionally done any act likely to injure the credit of the Society,
(f) gravely misused the dwelling rented by him from the Society or habitually acted in it
in a disgraceful manner or in a manner which has caused serious offence to his
neighbours or
(g) without the previous written permission of the Managing Committee has let or sub-let
or given on caretaker or leave licence basis or used for accommodating paying guests or
disposed of in any other manner any portion of the dwelling
accommodation/shops/godowns/garages.
(h) failed to occupy his premises in the building of the society within a period not
exceeding six months from the date of the allotment of a flat."
"Bye-Law 64. No member shall be tenant of the Society unless he subscribes to such
number of shares as the Managing Committee prescribes."
"Bye-Law 64(a). A member to whom a tenement is allotted shall occupy it himself and
shall not assign, underlet, vacate or part with the possession of the tenement or any part
thereof without the previous consent in writing of the Managing Committee. Such
permission shall not be granted unless the member authorizes the society to recover rent
or compensation and taxes and other common charges from the sub-lettee, licensee or
caretaker. The society shall admit every such sub-lettee, licensee, or caretaker as a
nominal member of the Society".
[Emphasis Added]
THE REGULATIONS
"Regulation 4. No tenant shall assign, underlet, vacate or part with the possession of the
tenement or any part thereof without the previous consent in writing of the Society."
"Regulation 24. The rent shall be calculated as follows and shall be paid on the first day
of each calendar month: -
(a) A rent of 6¼ per cent per annum (which shall not be increased during the tenancy) on
the cost including the building, land, roads and other items, such cost to be certified by
the Committee whose decision shall be final and conclusive and to be paid by 12 equal
calendar monthly payments.
(b) A further rent during the term of 25 years of ...... Per cent per annum (which shall not
be increased during the said term of 25 years except for a new tenant) on the said cost
such rent to be applied to the share account of the tenants and to be paid by 12 equal
calendar monthly payments and it is anticipated that when all these payments are made
the dividend on the shares will be equal to the rent paid under clause 24(a) hereof.
(c) A further rent equal to the proportion (applicable to the tenement) of the expense
incurred from time to time in insurance against fire, tempest or flood or violence by an
army or mob or other irresistible force and in the management of the Society and the
maintenance and repair of the Society's Estate such expense and proportion thereof
payable by the tenant to be determined by the Certificate of the Committee whose
decision shall be final and conclusive such further rent to be paid on the 1st day of the
calendar month next following the date of the said certificate.
(d) A further rent equal to the proportion
@page-SC756
applicable to the tenement of the sum or sums from time to time paid by the Society in
respect of assessment and rates such proportion to be determined by the Certificate of the
Committee whose decision shall be final and conclusive such further rent to be paid on
the 1st day of the calendar month next following the date of the said certificate.
I agree to take the tenement known as....................... subject to the above regulations
which I agree to observe and perform and by which I agree to be bound"."
[Emphasis added]
THE RENT ACT
"Section 5. Definitions.- In this Act unless there is anything repugnant to the subject or
context,-
* * * * *
(3) "landlord" means any person who is for the time being, receiving, or entitled to
receive, rent in respect of any premises whether on his own account or on account, or on
behalf, or for the benefit of any other person or as a trustee, guardian, or receiver for any
other person or who would so receive the rent or be entitled to receive the rent if the
premises were let to a tenant; and includes any person not being a tenant who from time
to time derives title under a landlord; and further includes in respect of his sub-tenant, a
tenant who has sublet any premises; [and also includes in respect of a licensee deemed to
be a tenant by section 15A, licensor who has given such license, [and in respect of the
State Government, or as the case may be, the Government allottee referred to in sub-
clause (b) of clause (1A), deemed to be a tenant by section 15B, the person who was
entitled to receive the rent if the premises were let to a tenant immediately before the
coming into force of the Bombay Rents, Hotel and Lodging House Rates Control,
Bombay Land Requisition and Bombay Government Premises (Eviction) (Amendment)
Act, 1996]]."
*****
"(11). "tenant" means any person by whom or on whose account rent is payable for any
premises and includes,-
(a) such sub-tenants and other persons as have derived title under a tenant [before the 1st
day of February 1973;]
[(aa) any person to whom interest in premises, has been assigned or transferred as
permitted or deemed to be permitted, under section 15;]
(b) any person remaining after the determination of the lease, in possession, with or
without the assent of the landlord, of the premises leased to such person or his
predecessor who has derived title [before the first day of February 1973;]
[(bb) such licensees as shall deemed to be tenants for the purposes of this Act by section
15A]
[(bba) the State Government, or as the case may be, the "'Government allottee, referred to
in sub-clause (b) of clause (1A), deemed to be a tenant, for the purposes of this Act by
section 15B;].
[(c) (i) in relation to any premises let for residence, when the tenant dies, whether the
death has occurred before or after the commencement of the Bombay Rents, Hotel and
Lodging House Rates Control (Amendment) Act, 1978, any member of the tenant's
family residing with the tenant at the time of his death or, in the absence of such member,
any heir of the deceased tenant, as may be decided in default of agreement by the Court;
(ii) in relation to any permission let for the purposes of education, business, trade or
storage, when the tenant dies, whether the death has occurred before or after the
commencement of the said Act, any member of the tenant's family using the premises for
the purposes of education of carrying on business, trade or storage in the premises, with
the tenant at the time of his death, or, in the absence of such member, any heir of the
deceased tenant, as may be decided in default of agreement by the Court.
Explanation. The provisions of this clause for transmission of tenancy, shall not be
restricted to the death of the original tenant, but shall apply, and shall be deemed always
to have applied, even on the death of any subsequent tenant, who becomes tenant under
these provisions on the death of the last preceding tenant.".]
"Section 15. [In absence of contract to the contrary, tenant not to sub-let or transfer] [or to
give on licence].-
[(1)] Notwithstanding anything contained in any law [but subject to any contract to the
contrary,] it shall not be lawful after the coming into operation of this Act for any tenant
to sub-let the whole or any part of the
@page-SC757
premises let to him or to assign or transfer in any other manner his interest therein [and
after the date of commencement of the Bombay Rents, Hotel and Lodging House Rates
Control (Amendment) Act, 1973, for any tenant to give on licence the whole or part of
such premises]:
[Provided that the [State] Government may by notification in the Official Gazette, permit
in any area the transfer of interest in premises held under such [leases or class of leases
[or the giving on licence any premises or class of premises] and on such extent as may be
specified in the notification.]
[(2) The prohibition against the sub-letting of the whole or any part of the premises which
have been let to any tenant, and against the assignment or transfer in any other manner of
the interest of the tenant therein, contained in sub-section (1), shall, subject to the
provisions of this sub-section be deemed to have had no effect [before the 1st day of
February, 1973], in any area in which this Act was in operation before such
commencement; and accordingly, notwithstanding anything contained in any contract or
in the judgment, decree or order of a Court, any such sub-lease, assignment or transfer of
any such purported sub-lease, assignment or transfer in favour of any person who has
entered into possession, despite the prohibition in sub-section (1) as purported sub-lessee,
assignee or transferee and has continued in a possession [on the date aforesaid] shall be
deemed to be valid and effectual for all purposes, and any tenant who has sub-let any
premises or part thereof, assigned or transferred any interest therein, shall not be liable to
eviction under clause (e) of sub-section (1) of section 13.
The provisions aforesaid of this sub-section shall not affect in any manner the operation
of sub-section (1) after the [date aforesaid]".
"Section 15A. Certain licensees in occupation on 1st February, 1973 to become tenants.-
(1) Notwithstanding anything contained elsewhere in this Act or anything contrary in any
other law for the time being in force, or in any contract where any person is on the 1st
day of February, 1973 in occupation of any premises, or any part thereof which is not less
than a room, as a licensee he shall on that date be deemed to have become, for the
purpose of this Act, the tenant of the landlord, in respect of the premises or part thereof,
in his occupation.
(2) The provisions of sub-section (1) shall not affect in any manner the operation of sub-
section (1) of section 15 after the date aforesaid".
"Section 28. Jurisdiction of Courts.-
[(1)] Notwithstanding anything contained in any law and notwithstanding that by reason
of the amount of the claim or for any other reason, the suit or proceeding would not, but
for this provision, be within its jurisdiction.-
(a) in Greater Bombay, the Court of Small Causes, Bombay [*]
[(aa) in any area for which, a Court of Small Causes is established under the Provincial
Small Cause Courts Act, 1887, such Court, and]
(b) elsewhere, the Court of the Civil Judge (Junior Division) having jurisdiction in the
area in which the premises are situate or, if there is no such Civil Judge the Court of the
Civil Judge (Senior Division) having ordinary jurisdiction,
shall have jurisdiction to entertain and try any suit or proceeding between a landlord and
a tenant relating to the recovery of rent or possession of any premises to which any of the
provisions of this Part apply [or between a licensor and a licensee relating to the recovery
of the licence fee or charge] and to decide any application made under this Act and to
deal with any claim or question arising out of this Act or any of its provisions-and subject
to the provisions of sub-section (2) no other court shall have jurisdiction to entertain any
such suit, proceeding, or application or to deal with such claim or question.
[(2) (a) Notwithstanding anything contained in clause (aa) of sub-section (1), the District
Court may at any stage withdraw any such suit, proceeding or application pending in a
Court of Small Causes established for any area under the Provincial Small Cause Courts
Act, 1887, and transfer the same for trial or disposal to the Court of the Civil Judge
(Senior Division) having ordinary jurisdiction in such area.]
(b) Where any suit, proceeding or application has been withdrawn under clause (a), the
Court of the Civil Judge (Senior Division) which thereafter tries such suit,
@page-SC758
proceedings or application, as the case may be, may either re-try it or proceed from the
stage at which it was withdrawn.
(c) The Court of the Civil Judge trying any suit, proceeding or application withdrawn
under clause (a) from the Court of Small Causes, shall, for purposes of such suit,
proceeding or application, as the case may be, be deemed to be the Court of Small
Causes.
Explanation.- In this section "proceeding" does not include an execution proceeding
arising out of a decree passed before the coming into operation of this Act."
[Emphasis added]
11. In our country, for the first time, Co-operative Credit Societies Act, 1904 was passed,
to encourage thrift, self-help and co-operation among agriculturists, artisans and persons
of limited means, and for that purpose to provide for the constitution and control of co-
operative credit societies, which laid down the foundation of co-operative law. Under that
Act ten members could form a society and the object of the society was to raise funds
either from members or outsiders and give loans to the needy members out of the funds
so collected. The principle of limited liability was also recognized and the concept of
profit motive was given a go-by. The tendency towards concentration of wealth in a few
hands was discouraged by providing that no member could hold shares beyond a certain
limit. The said Act was replaced by the Co-operative Societies Act, 1912, which was
repealed by the Bombay Co-operative Societies Act, 1925. The aforementioned Act was
repealed by the Maharashtra Co-operative Societies Act, 1960 to consolidate and amend
the law relating to co-operative societies in the State of Maharashtra the objective of
which was to provide for the orderly development of the co-operative movement in the
State in accordance with the Directive Principles of State Policy enshrined in Part Four of
the Constitution of India.
12. 'Society' has been defined under Section 2(27) of the Societies Act to mean a co-
operative society registered or deemed to be registered under the Societies Act. Under
Section 2(5) 'bye-laws' means bye-laws registered under the Societies Act and for the
time being in force and includes registered amendments of such bye-laws. Under Section
2(16) 'housing society' has been defined to mean a society, the object of which is to
provide its members with open plots for housing, dwelling houses or flats; or if open
plots, the dwelling houses or flats are already acquired, to provide its members common
amenities and services. Section 2(19) defines 'member' to be a person joining in an
application for the registration of a co-operative society which is subsequently registered,
or a person duly admitted to membership of a Society after registration and includes an
associate, nominal or sympathiser member. Under Section 2(19)(c) 'nominal member' is a
person admitted to membership as such after registration in accordance with bye-laws.
Section 2(21) defines the expression 'prescribed' to mean prescribed by Rules. Under
Section 2(24) 'Registrar' has been defined to mean a person appointed as Registrar of Co-
operative Societies under the Societies Act. 'Rules' under Section 2(26) means Rules
made under the Societies Act.
13. Section 4 of the Societies Act lays down that a Society which has as its objects the
promotion of economic interests or general welfare of its members or of the public in
accordance with co-operative principles or a Society established with the object of
facilitating the operations of any such Society, may be registered under the Societies Act.
Under Section 9, upon the satisfaction of the Registrar, Co-operative Society and its bye-
laws are registered on an application made to that effect under Rule 8. Section 12 lays
down that the Registrar shall classify all societies into one or other of the classes of
societies defined in Section 2 and also into such sub-classes thereof, as may be
prescribed. Rule 10 prescribes such classification of the Societies and under Rule 10(1)
(5) three types of housing societies have been enumerated. First is under Rule 10(1)(5)(a)
which is a 'tenant ownership housing society' where land is held either on leasehold or
freehold basis by the Society and houses are owned or are to be owned by members. The
second type of housing society under Rule 10(1)(5)(b) is 'tenant co-partnership housing
society' which holds both land and buildings either on leasehold or freehold basis and
allots them to its members. The third type under Rule 10(1)(5)(c) is 'other housing
societies' which are called house mortgage and house construction societies and the same
do not come in any of the categories of housing societies referred to above.
@page-SC759
14. Section 22 of the Societies Act enumerates the persons who are eligible to be
admitted as members of a society. Section 23 lays down that no society shall, without
sufficient cause, refuse admission to membership to any person duly qualified therefor
under the provisions of the Societies Act and its bye-laws. Section 24 lays down that even
if any person does not fulfill the eligibility requirement enumerated in Section 22 of the
Societies Act, he can be admitted by the Society as a nominal, associate or sympathizer
member. According to Section 25 a person shall cease to be a member of the Society on
his resignation from the membership thereof being accepted or on the transfer of the
whole of his share or interest in the Society to another member or on his death or removal
or expulsion from the Society or where a firm, company, any other corporate body,
society or trust is its member, on its dissolution or ceasing to exist. Under Section 35 a
society is empowered by resolution passed by a majority of not less than three-fourths of
the members entitled to vote, who are present at its general meeting held for the purpose,
to expel a member for acts which are detrimental to the interest or proper working of the
Society. Under Rule 28 of the Rules any member who has been persistently defaulting
payment of dues or has failed to comply with the provisions of the bye-laws regarding
sales of his produce through the Society or other matters connected therewith in
connection with his dealings with the Society or who, in the opinion of the committee,
has brought disrepute to the Society or has done other acts detrimental to the interest or
proper working of the society may, in accordance with the provisions of sub-section (1)
of Section 35, be expelled from the society. Under bye-law 12 a member is required not
to let or sub-let or give on caretaker or leave and licence basis or use for accommodating
paying guests or dispose of in any manner any portion of the tenement without the
previous written permission of the Managing Committee of the Society and failure
thereof tantamounts to violation of the bye-laws within the meaning of Rule 28 and such
a member would be liable to be expelled thereunder.
15. Section 29(2) of the Societies Act provides that a member shall not transfer, inter alia,
any interest in the property of any society or any part thereof unless two conditions are
fulfilled, namely, the member has held such interest for not less than one year and the
transfer is made either to an existing member of the Society or to a person whose
application for membership has been accepted by the society or to a person whose appeal
under Section 23 of the Societies Act has been allowed by the Registrar or to a person
who is deemed to be a member under sub-section (1A) of Section 23 of the Societies Act.
16. Under Rule 8(2) of the Rules, a society may make bye-laws prescribing thereunder,
inter alia, conditions, if any, under which the transfer of share held by a member or
interest of a member in the tenement allotted to him may be permitted. Under bye-law
64(a) a member to whom a tenement is allotted shall be entitled to occupy the same
himself and is not permitted to assign, underlet, vacate or part with the possession of the
same or any part thereof without the previous consent in writing of the Managing
Committee of the Society, which permission shall not be granted unless the member
authorises the society to recover rent or compensation and taxes and other common
charges from the sub-lettee, licensee or caretaker who must agree to become its nominal
member. Regulation 4 of the Regulations, which every member at the time of his
admission to the membership of the Society is required to observe by giving an
undertaking in writing, provides that no tenant shall assign, underlet, vacate or part with
possession of the premises or any part thereof without the previous consent in writing of
the Society.
17. Bye-law 2(a) enumerates objects of the Society one of which would be to purchase
plot and to make constructions thereon for use of its members. The further objects of the
Society are to advance loans to its members, guarantee loans to its members for acquiring
building sites, constructing houses, to receive or guarantee repayments in lump sum or in
instalments and to do all things necessary or expedient for the attainment of the objects
specified in the bye-laws, meaning thereby that every member to whom a plot or flat is
allotted for his self-occupation and use shall not part with possession thereof unless
permitted by the Society, which, at the time of grant of permission, shall admit such
persons in whose favour the member intends to part with possession by admitting him as
a nominal
@page-SC760
member. Bye-law 7 lays down that all persons permanently residing in Bombay City and
Suburban areas or those who intend to settle down in Bombay City and Suburban areas
shall be eligible to be admitted as members by the Committee of the Society. Bye-law 64
requires that no member shall be a tenant of the society in respect of the tenement unless
he subscribes to such number of shares as the Managing Committee prescribes, which is
five paid-up shares in the society as per regulation 1 of the Regulations and upon
subscribing to such shares under bye-law 64 such a member shall be allotted a tenement
for his self-occupation who shall not part with possession thereof in any manner without
the previous consent in writing of the Managing Committee and while granting such
permission the person in whose favour the member intends to part with possession shall
be admitted as nominal member.
18. Under Regulation 2, the committee of the Society is required to maintain a register of
applicants for the tenements and the tenements would be offered to the members in the
order in which they appear in the register and in the event of two or more members
having made application on the same day, the one to whom the offer is to be made shall
be determined by lot. Regulation 3 permits the tenancy to continue as long as the tenant
or his successor in all respects observes and performs the obligations imposed upon him
under the Regulations as a tenant. Regulation 4 forbids a tenant to part with the
possession of the tenement without the previous consent in writing of the Society.
Regulation 24 enumerates the manner in which rent would be calculated. The cost of the
land, building, road and other items to be determined by the committee of the Society and
6-1/4% thereof shall be paid every year in 12 equal monthly instalments. In addition to
the aforesaid rent, the tenant is required to make certain other payments by way of rent as
required under sub-clauses (b) to (d) of Regulation 24. In the present case, the member in
whose favour tenement, i.e., the flat, has been allotted had undertaken in writing that he
agreed to take the tenement subject to the Regulations and agreed to observe the same.
19. Section 31 gives immunity to the share or interest of a member in the capital of a
Society or in the loan stock issued by Society or in the funds raised by a Society from its
members by way of savings deposit, from attachment or sale under any decree or order of
a court for or in respect of any debt or liability incurred by the member. According to the
provisions of Section 36 of the Societies Act, a Society, upon its registration, shall be
treated to be a body corporate, as such a juristic person. Section 47(2) of the Societies Act
lays down that interest of a member in those properties of the society whereupon a charge
has been created under sub-section (1) of Section 47 shall not be transferred in any
manner without the previous permission of the Society and for according permission the
Society may impose such conditions as it may deem fit and proper. According to Section
47(3) any transfer made in contravention of sub-section (2) of Section 47 shall be void.
Under Section 79AA Regulations can be framed by the Society for carrying on its trade
or business on the direction of the Registrar and the same are required to be approved by
him.
20. Section 91, which begins with a non obstante clause, lays down that if there is any
dispute, inter alia, touching the business of a society, the same shall be referred to
Cooperative Court by, inter alia, any of the parties to the dispute. Section 91(3) lays down
that, except as provided under sub-section (2) of Section 93 of the Societies Act, no court
shall have jurisdiction to entertain any suit or proceeding in respect of any dispute
referred to in sub-section (1) of Section 91 of the Societies Act. Section 93(2), which also
begins with a non obstante clause, provides that the Co-operative Court may, on an
application made to it by any of the parties to dispute, if it thinks fit, suspend any
proceedings in respect of any dispute, if the question at issue between a society and a
claimant or between different claimants is one involving complicated questions of law
and fact, until the question has been tried by a regular suit instituted by one of the parties
or by the Society, but if any such suit is not instituted in a Civil Court within two months
from the date of the order passed by the Co-operative Court, the proceedings under
Section 91(1) shall continue and dispute raised by the parties shall be decided by the Co-
operative Court. Section 94(1) lays down that the procedure for adjudication of the
aforesaid disputes raised by the parties shall, as far as possible, be the same as provided
in the case of Civil Court by the Code of Civil Procedure, 1908.
@page-SC761
Section 97 prescribes appeal before the Co-operative Appellate Court against award of
the Co-operative Court adjudicating the dispute raised under Section 91 of the Societies
Act.
21. According to Section 146(1)(a) if any member of a society makes any transfer of any
property or interest in property in contravention of sub-section (2) of Section 47 or any
persons knowingly acquires or abets in the acquisition of such property, the same, inter
alia, would be an offence under the Societies Act, punishment for which has been
provided under Section 147 of the Societies Act. Section 165 empowers the State
Government to make Rules for, inter alia, the conduct and regulation of business of
Society and carrying out the purposes of the Societies Act.
22. The Rent Act was enacted to amend and consolidate the law relating to the control of
rents and repair of certain premises, of rates of hotels and lodging house and of evictions
and also to control the charges for licence of premises etc. Section 5(3) of the Rent Act
defines a 'landlord' to be a person who, for the time being, is receiving or entitled to
receive rent of any premises from a tenant, which includes a licensee who is deemed to
be a tenant within the meaning of Section 15A of the Rent Act. Section 5(11) defines
'tenant' to mean a person by whom or on whose account rent is payable for any premises
which, inter alia, includes a licensee, who is a deemed tenant under Section 15A of the
Rent Act but shall not include such a sub-tenant to whom interest in the premises has
been purported to have been assigned or transferred in the absence of any contract to the
contrary as required under Section 15 of the Rent Act. Section 13 of the Rent Act
enumerates the grounds for eviction of a tenant which includes bona fide need of the
landlord. Section 15 of the Rent Act lays down that in the absence of any contract to the
contrary, it shall not be lawful for any tenant to sublet the whole or any part of the
premises in which he was inducted as a tenant. Section 15A lays down that if any licensee
who was in occupation of the premises, in which he was inducted as a licensee, before the
1st day of February, 1973 and the licence was subsisting on that date, he shall be deemed
to have become a tenant of the landlord in respect of the premises on that date i.e.,
1.2.1973 when Maharashtra Act 17 of 1973 came into force whereby Section 15A was
inserted in the Rent Act.
23. Section 28, which starts with a non obstante clause, lays down that suit or proceeding
between a landlord and a tenant relating to recovery of rent or possession of any premises
to which provisions of Rent Act apply shall be entertained by a court enumerated
thereunder and no other court shall have jurisdiction to entertain any such suit,
proceeding or application or to deal with such claim or question.
24. We now proceed to deal with the first question, i.e., whether, in the present case,
status of the member was that of a tenant or landlord within the meaning of the Rent Act
and consequently there was any relationship of landlord and tenant between them? Under
Rule 10(1)(5)(a) 'tenant ownership housing society' has been defined to mean housing
society where land is held either on leasehold or freehold basis by the societies and
houses are owned by its members, whereas under Rule 10(1)(5)(b) in case of 'tenant co-
partnership housing Society', the society holds both land and buildings either on
leasehold or freehold basis and allots them to its members. In the case of tenant co-
partnership housing society, it is clear from the Rules that the ownership of the land and
building both remains with the Society and member cannot be said to be co-owner, but in
the case of tenant ownership housing society, the ownership of the land remains with the
society, but ownership of the building/flat vests in the member. So far as tenant within the
meaning of Section - 5(11) of the Rent Act is concerned, he has a mere right to occupy.
He is entitled to the protection of the Statute so long as grounds for eviction are not made
out and can be evicted only by instituting a suit in a court enumerated under Section 28 of
the Rent Act.
25

. The concept of tenant co-partnership housing society was considered by this Court in
the case of Sanwarmal Kejriwal vs. Vishwa Co-operative Housing Society Ltd., (1990) 2
SCC 288, wherein it was noticed that the title to the property, i.e., the land and
building/flat both, vests in the Society. It has been further noted that cost of construction
of the dwelling is met from deposits and rent besides the share money. The rental is
usually determined on long term basis so calculated as to meet the cost of construction
AIR 1990 SC 1563
AIR 1990 SC 1563, (Para 12)

@page-SC762
and upkeep of the building and to guarantee perpetuity of occupation on repayment of the
whole value of the tenement or flat. At the end of the period the member is credited with
additional shares equal to the amount paid by him, the interest on these shares generally
matches the rental payable by him to the society. This Court has concluded that on full
payment, the member becomes entitled to occupy the tenement or flat free of charge as
the rental he has to pay to the society is almost met from the interest received from shares
held by him and, consequently, a member has more than a mere right to occupy the same.
In this regard, we may usefully refer to paragraph 13 of the case of Sanwarmal [supra]
which reads thus :-
"13. That takes us to the next question whether or not a member of a copartnership type
of a co-operative society has such interest in the premises allotted to him as would entitle
him to give the same on leave and licence basis to a non-member. In a tenant co-
partnership type of society the members are shareholders; but the title to the property
vests in the society which in turn rents the tenements or flats to its members. The cost of
construction of dwellings is met from deposits and loans besides the share money. The
rental is usually determined on long term basis so calculated as to meet the cost of
construction and upkeep of the building and to guarantee perpetuity of occupation on
repayment of the whole value of the tenement or flat. At the end of the period the member
is credited with additional shares equal to the amount paid by him; the interest on these
shares generally matches the rental payable by him to the society. Thus on full payment
the member becomes entitled to occupy the tenement of flat free of charge as the rental
he has to pay to the society is almost met from the interest received from shares held by
him. Thus a member has more than a mere right to occupy the flat."
[Emphasis added]
26. From a bare perusal of the aforesaid passage, it would be clear that after full payment
a member is entitled to continue to occupy the tenement free of charge and neither he is
liable to pay any rent to the society nor the society is entitled to receive any rent from the
member. According to the definition of 'landlord' under Section - 5(3) of the Rent Act,
landlord is a person who is for the time being receiving or entitled to receive rent and
under Section 5(11) a tenant is liable to pay rent, but in view of the observations of this
Court in Sanwarmal (supra), neither the Society is entitled to receive rent from the
member nor member is liable to pay any rent to the Society after the entire value of the
land and cost of construction of the building together with interest on its value has been
paid.
27. The matter may be examined from another angle. If it is held that the Society is a
landlord and the member is a tenant within the meaning of the Rent Act, in that event the
society can evict the member by filing a suit for eviction if it requires the premises for its
bona fide need, but under the Societies Act, it can evict the member only as a
consequence of his expulsion from the membership and neither under the Societies Act
nor Rules framed thereunder nor Bye-Laws nor Regulations there is any provision that a
Society can evict a member in case it has got bona fide need of the same. The said
interpretation would be contrary to the object of the Societies Act.
28. It appears to us that the status of a member in a tenant co-partnership housing Society
is very peculiar. The ownership of the land and building both vests in the Society and the
member has, for all practical purposes, right of occupation in perpetuity after the full
value of the land and building and interest accrued thereon have been paid by him.
Although de jure he is not owner of the flat allotted to him, but, in fact, he enjoys almost
all the rights which an owner enjoys, which includes right to transfer in case he fulfills
the two pre-conditions, namely, he occupies the property for a period of one year and the
transfer is made in favour of a person who is already a member or a person whose
application for membership has been accepted by the Society or whose appeal under
Section 23 of the Societies Act has been allowed by the Registrar or to a person who is
deemed to be a member under sub-section (1A) of Section 23 of the Societies Act. In case
any of these two conditions is not fulfilled, a member cannot be said to have any right of
transfer. Thus, we reiterate the law laid down by this Court in the case of Sanwarmal
(supra) that a member has more than a mere right to occupy the flat, meaning thereby
higher than tenant, which is not so in the case of a
@page-SC763
tenant within the meaning of Section 5(11) of the Rent Act. This being the position, we
have no difficulty in coming to the conclusion that the status of a member in the case of
tenant co-partnership housing society cannot be said to be that of a tenant within the
meaning of Section 5(11) of the Rent Act, as such there was no relationship of landlord
and tenant between the Society and the member.
29. We now turn to the second question, i.e., as to whether the status of the appellants was
that of tenant or sub-tenant. In view of our answer to question No. 1 that the status of the
member was higher than a tenant and although de jure he was not an owner but, for all
practical purposes, he was exercising almost all the rights of an owner, excepting absolute
right of transfer, he not being the tenant, there is no question of his creating sub-tenancy
in favour of the appellants. A member may not be an owner of the flat in the eye of law
but he may still be a landlord within the meaning of the Rent Act which does not
necessarily postulate a landlord to be an owner of the property, but if a person is entitled
to receive rent or receiving rent he may be treated to be a landlord within the meaning of
the Rent Act. The question arises as to whether such a member could create a tenancy
right under law, meaning thereby whether the relationship of landlord and tenant between
the member and the appellants was duly created so as to claim protection from eviction
under the Rent Act. The factum of letting out by the member to the appellants is not in
dispute. Purported creation of tenancy right in favour of the appellants was in infraction
of the provisions of Section 29(2) of the Societies Act whereunder there is a legislative
command to the member not to transfer his interest in the property of the Society unless
two conditions are fulfilled, firstly, the member has held the interest for a period of not
less than one year, meaning thereby that he has remained in occupation of the flat, which
was allotted to him by the Society, for a period of one year and, secondly, transfer was
made to a member of the Society or to a person whose application for membership has
been accepted by the Society or to a person whose appeal under Section 23 of the
Societies Act has been allowed by the Registrar and his application for membership has
been accepted by him or to a person who is deemed to be a member under sub-section
(1A) of Section 23. In the present case, the first pre-requisite is fulfilled, but so far as the
second one is concerned, the appellants who claim to be tenants were not existing
members of the Society nor they ever filed any application for membership of the
Society, much less its acceptance nor it has been claimed that they shall be deemed to
have become members of the Society under sub-section (1A) of Section 23 of the
Societies Act.
30. Undisputedly, in the present case, there is infraction of the provisions of Section 29(2)
of the Societies Act. Now it has to be seen whether sub-section (2) of Section 29 is
mandatory or directory. From the scheme of the Societies Act, the Rules, Bye-Laws and
Regulations it would be clear that in a case of tenant co-partnership Society the
ownership of the land and the building both vest in the Society and the premises is
allotted to the member for his occupation only and not for the purpose of occupation of
anybody else. That is the object of the Societies Act as would appear from bye-law 2, i.e.,
'for use of the member', meaning thereby his own use. According to bye-law 64, the flat is
allotted to a member for occupying it himself. Regulation 4 is also in line with bye-law
64 which says that no tenant shall part with possession of the premises without the
previous consent in writing of the Society. Under bye-law 64(a) also a member is
restrained from parting with possession of the flat without permission of the Society
which shall be granted upon filing application, by an intending transferee, for grant of
membership by admitting him as a nominal member. Keeping in mind the language of
Section 29(2), which is in the nature of injunction upon the right of a member to transfer
unless the twin conditions are fulfilled, and the purpose for which the house is allotted to
a member, i.e., for his self-occupation, it cannot be said in any manner that the said
provision is directory as giving such an interpretation would frustrate object of the
Societies Act whereunder a flat is allotted to a member for his self-occupation as would
appear from the Societies Act, Rules, Bye-Laws and Regulations. As such, we have no
option but to hold that the provisions of Section 29(2) are mandatory.
31

. The question that arises now is that if there is any infraction of the said provision,
whether the same would invalidate the AIR 1975 SC 1470
AIR 1990 SC 1563
@page-SC764
creation of relationship of landlord and tenant between the member and the appellants. It
has been submitted on behalf of the appellants that the member had absolute right of
transfer, as such relationship of landlord and tenant was duly created. In support of the
submission, reliance was placed upon two decisions of this Court in the cases of Ramesh
Himmatlal Shah vs. Harsukh Jadhavji Joshi, (1975) 2 SCC 105 and Sanwarmal [supra].
In Ramesh [supra], the question in issue was as to whether interest of a member in a flat
allotted to him by co-partnership housing society could be attached and sold in execution
of a decree passed against a member. This Court referred to the provisions of Sections
29(2), 31 and 47 of the Societies Act. The Court was considering matter in the light of the
provisions of Section 31 of the Societies Act which lays down that share or interest of a
member in the capital of a society or in the loan stock issued by a Society or in the funds
raised by a Society from its members shall not be liable to attachment or sale under any
decree or order of a court in respect of any debt or liability incurred by a member. Under
this provision, there was immunity from attachment/sale in execution of a decree to
certain types of interests of a member of the society, but the interests of a member in the
flat was not enumerated thereunder, as such there was no provision exempting interest of
a member in the flat allotted to him from being attached and sold in execution of a decree
against a member. Therefore, there was no legal bar in attachment and sale of interest of a
member in the flat allotted to him by the Society. Before this Court the question was
raised that the restriction under Section 29(2) put on the right of a member to transfer
should be equally applied in the case of auction sale in execution of decree against a
member. Court observed that "the only restrictions under Section 29(2) are that the
member may not transfer his interest in the property prior to one year and the transfer is
made to an existing member of the Society or to a person whose application for
membership has been accepted by the Society". Though the Court has considered the
provisions of Section 47 which lay down that interest of a member in such a property
which was allotted to him and upon which there is a charge, cannot be sold by a member
without permission of the society and if there is infraction thereof, such a transaction has
been declared by Section 47(3) of the Societies Act to be void, obviously the restrictions
under Section 29(2) providing thereunder restricted right of voluntary transfer cannot
apply to auction sale in execution of a decree against a member which is distress sale as
the same has not been specifically exempted under Section 31 of the Societies Act. Of
course, while dealing with the provisions of Section 29(2), the Court was also having in
mind that under Section 47(3) if the transfer is in infraction of the provisions of Section
47(2) the same has been declared, to be void, by the Statute itself whereas in a case of
infraction of Section 29(2) of the Societies Act, the Statute is silent. As a matter of fact,
the question as to what would be the effect of infraction of the provisions of Section
29(2) was not subject-matter of consideration before this Court in the case of Ramesh
(supra), as such the law laid down therein that there was no prohibition against transfer of
right to occupy a flat was in the light of the fact whether interest of the member in the flat
could be auctioned/sold in execution of a decree passed against the member, meaning
thereby distress sale. In the present case we are concerned with voluntary transfer which
is in contra-distinction to distress sale, as such the said case is clearly distinguishable.
32. Another decision upon which reliance was placed on behalf of the appellants is the
case of Sanwarmal [supra]. In that case, a petition was filed under Section 91 of the
Societies Act for passing an order of eviction of a licensee who was inducted as a licensee
by a member of the Society, though contrary to the provisions of Section 29(2) of the
Societies Act, but he became deemed tenant under Section 15A of the Rent Act on
1.2.1973, i.e., the date on which the amending Act came into force, as the licensee was in
occupation of the premises and licence was subsisting on that date, as such this Court
held that the petition under Section 91 of the Societies Act was not maintainable as the
licensee acquired the status of tenant even though there was no privity of contract
between the parties, but as the status of tenant was acquired, by legislative intervention,
under Section 15A of the Rent Act, as such he was entitled to claim protection under the
said Act. Though in that case the question whether right to occupy a flat in a case of
tenant co-partnership
@page-SC765
society is transferable or not was not in issue before the Court, but following the
judgment in the case of Ramesh [supra], this Court observed that the right of a member in
the flat is transferable. In our view, the aforesaid observation in the case of Sanwarmal
[supra) cannot be said to be ratio of the case but a mere obiter, as such the same can be of
no avail to the appellants.
33. It has been submitted that in case transfer has been made by a member in infraction of
the provisions of Section 47(2) of the Societies Act, according to the provisions of
Section 47(3) the same shall be void, but there is no such provision in case there is
infraction of the provisions of Section 29(2) which, we have already found, are
mandatory. In case there is infraction of a mandatory provision, in that event the
transaction cannot be said to be void but would obviously be voidable and once avoided,
the relationship of landlord and tenant, i.e., between the member and the appellants
cannot be said to have been duly created, meaning thereby in accordance with law. Thus,
we have no difficulty in holding that the relationship of landlord and tenant between the
appellants and the member was not duly created, as such the appellants would not be
entitled to claim protection under the Rent Act and the bar created under Section 28 of the
Rent Act would not operate.
34. This takes us to the next question whether legality or otherwise of the creation of
relationship of landlord and tenant between the member and the appellants could be
adjudicated in the suits filed by the appellants before the Court of Small Causes for
declaration that they were tenants in the premises in their respective occupation and there
was relationship of landlord and tenant between the member and the appellants. The said
suits were dismissed by the trial court after recording a finding that no relationship of
landlord and tenant existed between the member and the appellants, but on appeal being
taken the appellate Bench of the Court of Small Causes decreed the suits holding that
relationship of landlord and tenant did exist between the member and the appellants after
reversing decree passed by trial court. When the matter was taken to the High Court in
writ applications, the same have been allowed, decrees passed by the appellate Bench of
the Small Cause Court set aside and those of the trial court restored whereby it was held
that there was no relationship of landlord and tenant between the member and the
appellants. When suits were filed before the Small Cause Court by the appellants for a
declaration that there was relationship of landlord and tenant between them and the
member, it was open to the defendants to take a defence that no such relationship was
created either in fact or in law as creation of such a right was barred under Section 29(2)
of the Societies Act. In the present case the factum of creation of tenancy has not been
disputed, but what has been disputed is its legality. As the creation of tenancy was in
infraction of mandatory provisions of Section 29(2), it was voidable and invalid in law
although not void and the Small Cause Court was not only competent to decide the same
but obliged under law to go into the same before granting or refusing relief to the plaintiff
as the same was a point in issue in those suits. This being the position, we are of the view
that the High Court was justified in setting aside the decrees passed by the appellate
Bench of the Small Cause Court and restoring those of the Small Cause Court whereby
suits for declaration were dismissed after recording a finding that there was no
relationship of landlord and tenant between the member and the appellants who were
consequently not entitled to claim protection under the Rent Act and no interference by
this Court is called for.
35. The last question that falls for decision is as to whether the Society was required to
first obtain adjudication from a competent civil court by filing a properly constituted suit
for a declaration that relationship of landlord and tenant was not duly created and,
therefore, the induction of a person by the member as tenant was invalid, the same being
in infraction of mandatory provisions of Section 29(2) of the Societies Act before raising
a dispute under Section 91 of the Societies Act or the said question could be gone into in
a proceeding under Section 91 of the Societies Act before the Co-operative Court where a
dispute touching upon the business of the Society can be raised by the parties and in
deciding the said dispute was it permissible for the Court to go into the said question. It is
true that ordinarily in case of a transaction like the present one which is voidable and not
void, if an aggrieved party intends to avoid the same it is required to obtain a decree from
a competent civil court by filing a properly
@page-SC766
constituted suit. But in a case like the present one, if a party is first asked to obtain a
decree from a competent civil court and only thereafter raise a dispute which is
undisputedly touching upon the business of the Society under Section 91 of the Societies
Act, the same would frustrate the provisions of Section 91 and the intention of the
Legislature in incorporating a cheap and expeditious remedy by referring the same to a
court constituted under the Societies Act instead of throwing a party to cumbersome
procedure of moving a civil court.
36. The dispute raised in the present case, undoubtedly, touches upon business of the
Society which is a condition precedent for the applicability of Section 91 of the Societies
Act. The business of tenant co-partnership housing society is, after purchasing plots and
constructing houses/flats thereon, to allot the same to its members for their self-
occupation and for a period of one year they cannot part with possession of the same in
favour of anybody and on expiry of the said period can transfer the same in favour of
member of the Society or to a person whose application for membership has been
accepted by the Society or to a person whose appeal under Section 23 of the Societies Act
has been allowed by the Registrar or to a person who is deemed to be a member under
sub-section (1A) of Section 23 of the Societies Act. It is part of business of the Society to
see that the house/flat allotted to a member remains in his occupation or in occupation of
any other member and if any non-member intends a transfer in his favour, like the present
one, he is required to obtain previous consent in writing either of the Society or its
Managing Committee and in the event of consent being accorded, the Society shall admit
him as a nominal member in which eventuality only the transfer can be made in his
favour. In the present case, under Section 91 of the Societies Act, the Society was well
within its right to get a dispute adjudicated as to whether the member had, by inducting
the tenants in the flat, who were non-members, made a transfer in contravention of the
provisions of Section 29(2) of the Societies Act. Thus the question regarding legality or
otherwise of the creation of tenancy right by the member in favour of the appellants,
which amounts to transfer of interest of a member in the property of the Society, can be
decided by raising a dispute before the Co-operative Court.
37. In the present case, the only dispute raised before the Co-operative Court was as to
whether transfer made by a member in favour of a so-called transferee/tenant thereby
purporting to create a tenancy right in his favour was in infraction of the mandatory
provisions of Section 29(2) of the Societies Act, as such the same was touching upon
business of the Society. In case Co-operative Court decides such a dispute in favour of
the Society in that eventuality the so-called transferee/tenant would not be entitled to
claim any protection under the Rent Act, the bar provided under Section 28 of the Rent
Act would not operate and consequently the petition under Section 91 of the Societies Act
would be maintainable.
38

. Learned counsel appearing on behalf of the appellants submitted that even if the tenancy
is created in breach of law having statutory force, the same would not be void. Reliance
in this connection has been placed upon a decision of this Court in the case of Nanakram
vs. Kundalrai, (1986) 3 SCC 83, in which it was held that tenancy created in breach of
Rent Control Order, which was having a statutory force, was not void. In that case under
Clause 22 of the Central Provinces and Berar Letting of Houses and Rent Control Order,
1949 a landlord was required to report the matter to the Deputy Commissioner, upon
vacation of the premises, who alone was empowered to permit induction of any tenant,
but instead of adopting the said procedure, landlord himself inducted tenant which was
challenged by filing a suit before civil court for a declaration that creation of tenancy
right was invalid. The trial court decreed the suit and the said decree was confirmed in
appeal by the High Court. When the matter was brought to this Court, it was held that the
transaction was not void and the infraction alleged was not of mandatory provisions of
law which would obviously mean that the transaction was not even voidable, as such the
suit was liable to be dismissed. In our view, the case of Nanakram [supra] is quite
distinguishable and shall have no application to the present case as here there was
infraction of mandatory provisions of Section 29(2) of the Societies Act. Thus we hold
that the question regarding legality or otherwise of creation of relationship of landlord
and tenant between the member and AIR 1986 SC 1194

@page-SC767
the appellants could have been gone into by the Co-operative Court under Section 91 of
the Societies Act as it touches upon business of the Society and the High Court has not
committed any error in not interfering with the order passed by appellate court
confirming that rendered by the Co-operative Court.
39. For the foregoing reasons, we do not find any merit in these appeals which are
accordingly dismissed, but there shall be no order as to costs.
Appeal dismissed.
AIR 2008 SUPREME COURT 767 "Deddappa v. Branch Manager, National Insurance
Co. Ltd."
(From : Karnataka)
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Civil Appeal No. 5829 of 2007 (arising out of SLP (C) No. 7746 of 2006), D/- 12 -12
-2007.
Deddappa and Ors. v. The Branch Manager, National Insurance Co. Ltd.
Motor Vehicles Act (59 of 1988), S.147 - MOTOR VEHICLES - INSURANCE -
SUPREME COURT - Compensation - Liability of insurer - Cheque issued by insured
towards payment of premium was dishonoured - As a result policy of insurance was
cancelled - Insured was intimated about cancellation much before accident occurred -
Insurer not liable to pay compensation - However, since claimant hailed from lowest
strata of society, Court in exercise of powers under Art. 142, directed insurer to pay
compensation and recover it from owner.
Constitution of India, Art.142.
Insurance Act (4 of 1938), S.64VB.
The statutory liability of the Insurance Company vis-a-vis a third party in the context of
Sections 147 and 149 of the Act, arising under a contract of insurance would have to be
met if the contract is valid. If the contract of insurance has been cancelled and all
concerned have been intimated thereabout, the insurance company would not be liable to
satisfy the claim. A beneficial legislation as is well known should not be construed in
such a manner so as to bring within its ambit a benefit which was not contemplated by
the legislature to be given to the party.
Thus, where the cheque issued by insured towards premium was dishonoured and as a
result Policy of Insurance was cancelled and intimation of cancellation was given to
insured much prior to accident, the insured was not liable to pay compensation. However,
since claimant hailed from the lowest strata of society, Court in exercise of its powers
under Art. 142 directed insurer to pay compensation and recover it from owner.
(Paras 26, 28)
Cases Referred : Chronological Paras
2006 AIR SCW 2352 : AIR 2006 SC 1926 : 2006 Lab IC 2002 : 2006 (4) AIR Kar R 48 :
2006 (3) AIR Jhar R 127 (Ref.) 25
2001 AIR SCW 902 : AIR 2001 SC 1197 (Ref.) 8, 21
2000 AIR SCW 788 : AIR 2000 SC 182 (Ref.) 20
1998 AIR SCW 183 : AIR 1998 SC 588 (Ref.) 8, 16, 18
AIR 1985 SC 278 : 1985 Lab IC 544 (Ref.) 27
AIR 1976 SC 2229 (Ref.) 24
(1976)1 WLR 989 25
(1976) QB 44 25
C. M. Angadi and Rameshwar Prasad Goyal, for Appellants; Mrs. Pankaj Bala Verma,
Ms. Kiran Suri and Dr. Laxmi Shastri, for Respondent.
Judgement
1. S. B. SINHA, J. :- Leave granted.
2. This appeal is directed against the judgment and order dated 15.6.2005 passed by a
learned Single Judge of the High Court of Karnataka in M.F.A No. 5751 of 2002,
whereby and whereunder an appeal preferred by the respondent herein from the judgment
and order dated 12.06.2002 passed by the Motor Accidents Claims Tribunal in M.C.A.
No.113 of 2001 was allowed.
3. Shantamma, daughter of the appellant herein was sleeping in her hut. A tempo bearing
No.KA 37-2257 which was being rashly and negligently driven by Respondent No.2
herein ran over her. She died on the spot. Household articles of the appellant also were
damaged in the said accident.
4. An application for grant of compensation was filed by the appellants herein under
Section 166 of the Motor Vehicles Act, 1988 (for short "the Act") in the Court of C.J.
(SD) and Motor Accidents Claims Tribunal at Gangavati in the district of Koppal on
12.06.2006.
5. The said vehicle was insured with the National Insurance Company. A plea was taken
therein by the Insurance Company that although the vehicle in question was insured by
the owner for the period
@page-SC768
17.10.1997 and 16.10.1998, but the cheque issued therefor having been dishonoured, the
policy was cancelled and, thus, it was not liable therefor.
6. By an Award dated 12.06.2002, the learned Motor Vehicles Accidents Claims Tribunal
allowed the said claim application directing payment of compensation for a sum of
Rs.1,58,000/- with interest @ 12% per annum holding that the Insurer was liable to pay
the said awarded amount despite cancellation of the contract of insurance. As noticed
hereinbefore the High Court of Karnataka on an appeal preferred by the first respondent
herein allowed the same relying on the judgment of the Karnataka High Court in M.F.A.
No. 6430 of 2001.
7. Mr. C.M. Angadi, the learned counsel appearing on behalf of the appellant in support
of this appeal inter alia submitted that the High Court committed a serious error in
passing the impugned judgment in so far as it failed to take into consideration that when
the insurance cover was issued, the liability of the Insurance Company subsists despite
dishonour of cheque evidencing payment of the insurance premium.
8

. Strong reliance in this behalf has been placed on Oriental Insurance Co. Ltd. v. Inderjit
Kaur and Ors. [(1998) 1 SCC 371] and National Insurance Co. Ltd. v. Seema Malhotra
and Ors. [(2001) 3 SCC 151]. 1998 AIR SCW 183
2001 AIR SCW 902

9. Before embarking on the said question we may notice the admitted facts. Second
respondent who was driving the vehicle was also the owner thereof. The insurance policy
was to remain valid for the period 17.10.1997 to 16.10.1998. Respondent No.3 issued a
cheque on 15.10.1997. The said cheque was presented for encashment before the
Syndicate Bank. The Bank by its letter dated 21.10.1997 issued a 'Return Memo'
disclosing dishonour of the cheque with the remarks "fund insufficient". First Respondent
thereupon cancelled the policy of insurance. The said information was communicated to
Respondent No.2. An intimation thereabout was also given to the R.T.O. concerned.
10. Before the Motor Vehicle Accidents Claims Tribunal, the insurer has also examined
witnesses, inter alia, to prove cancellation of the policy of insurance, postal
acknowledgment showing intimation thereabout which was served to the insured and a
copy of the letter dated 6.11.1997 issued to the R.T.O. and the memo issued by the Bank
as regards dishonour of the cheque etc.
11. Indisputably, the accident had occurred on 6.2.1998 that is much after communication
of cancellation of the policy.
12. Keeping in view the aforementioned backdrop of all events, we may notice the legal
issues addressed before us by the learned counsel.
13. Section 147 of the Act obligates the owner of the motor vehicle to get the vehicle
insured insofar as the claim of third party is concerned. The Act does not deal with
contract of insurance as such. Contract of insurance is governed by the Insurance Act,
1938 (for short "the 1938 Act").
14. Section 64-VB of the 1938 Act provides that no risk is to be assumed unless premium
is received in advance in the following terms :-
"Section 64VB - No risk to be assumed unless premium is received in advance-(1) No
insurer shall assume any risk in India in respect of any insurance business on which
premium is not ordinarily payable outside India unless and until the premium payable is
received by him or is guaranteed to be paid by such person in such manner and within
such time as may be prescribed or unless and until deposit of such amount as may be
prescribed, is made in advance in the prescribed manner.
(2) For the purposes of this section, in the case of risks for which premium can be
ascertained in advance, the risk may be assumed not earlier than the date on which the
premium has been paid in cash or by cheque to the insurer.
Explanation.-Where the premium is tendered by postal money order or cheque sent by
post, the risk may be assumed on the date on which the money order is booked or the
cheque is posted, as the case may be.
(3) Any refund of premium which may become due to an insured on account of the
cancellation of a policy or alteration in its terms and conditions or otherwise shall be paid
by the insurer directly to the insured by a crossed or order cheque or by postal money
order and a proper receipt shall be obtained by the insurer from the insured, and such
refund shall in no case be credited to the account of the agent.
@page-SC769
(4) Where an insurance agent collects a premium on a policy of insurance on behalf of an
insurer, he shall deposit with, or despatch by post to, the insurer, the premium so
collected in full without deduction of his commission within twenty-four hours of the
collection excluding bank and postal holidays.
15. The said provision, therefore, in no unmistakable term provides for issuance of a valid
policy only on receipt of payment of the premium.
16. The question came up for consideration before this Court in Inderjit Kaur (supra),
wherein it was opined that a policy of insurance which is issued in public interest would
prevail over the interest of the insurance company. In that case a bus met with an
accident. The policy of insurance was issued on 30.11.1989. A letter stating that the
cheque had been dishonoured was sent by the Insurance Company to the insurer on
23.1.1990. The premium was paid in cash on 2.5.1990. The accident took place
19.4.1990. Despite noticing Section 64-VB of the 1938 Act, but having regard to the
underlying public policy behind the statutory scheme in respect of insurance as evidenced
by Sections 147 and Section 149 of the Act and in particular having regard to the fact that
policy of insurance to cover the bus without receiving the premium had already been
issued, this Court held that the Insurance Company was liable to indemnify the insured.
17. We may, however, notice that in terms of sub-section (5) of Section 147 and sub-
section (1) of Section 149 of the Act, the Insurance Company became liable to satisfy
awards of compensation in respect thereof, notwithstanding its entitlement to avoid or
cancel the policy for the reason that the cheque issued for payment of premium thereon
had not been honoured.
18

. The said question, however, was left open in Inderjit Kaur (supra). 1998 AIR
SCW 183

19. The said decision proceeded on the basis that it was the Insurance Company which
was responsible for placing itself in the said predicament as it had issued a policy of
insurance upon receipt only of a cheque towards the premium in contravention of the
provisions of Section 64-VB of the 1938 Act. The public interest in a situation of that
nature and applying the principle of estoppel, this Court held, would prevail over the
interest of the Insurance Company.
20

. The ratio of the said decision was, however, noticed by this Court in New India
Assurance Co. Ltd. v. Rula and Ors. [(2000) 3 SCC 195]. It was held that ordinarily a
liability under the contract of insurance would arise only on payment of premium, if such
payment was made a condition precedent for taking effect of the insurance policy but
such a condition which is intended for the benefit of the insurer can be waived by it.
2000 AIR SCW 788, (Para 11)

It was opined :-
"......If, on the date of accident, there was a policy of insurance in respect of the vehicle in
question, the third party would have a claim against the Insurance Company and the
owner of the vehicle would have to be indemnified in respect of the claim of that party.
Subsequent cancellation of the insurance policy on the ground of non-payment of
premium would not affect the rights already accrued in favour of the third party."
The dicta laid down therein clarifies that if on the date of accident the policy subsists,
then only the third party would be entitled to avail the benefit thereof.
21

. Almost an identical question again came up for consideration before this Court in
National Insurance Co. Ltd. v. Seema Malhotra and Ors. [(2001) 3 SCC 151], a Division
Bench noticed both the aforementioned decisions and analysed the same in the light of
Section 64-VB of the 1938 Act. It was held : 2001 AIR SCW 902

"17. In a contract of insurance when the insured gives a cheque towards payment of
premium or part of the premium, such a contract consists of reciprocal promise. The
drawer of the cheque promises the insurer that the cheque, on presentation, would yield
the amount in cash. It cannot be forgotten that a cheque is a bill of exchange drawn on a
specified banker. A bill of exchange is an instrument in writing containing an
unconditional order directing a certain person to pay a certain sum of money to a certain
person. It involves a promise that such money would be paid.
18. Thus, when the insured fails to pay the premium promised, or when the cheque issued
by him towards the premium is returned dishonoured by the bank concerned the insurer
need not perform his part of the
@page-SC770
promise. The corollary is that the insured cannot claim performance from the insurer in
such a situation.
19. Under Section 25 of the Contract Act an agreement made without consideration is
void. Section 65 of the Contract Act says that when a contract becomes void any person
who has received any advantage under such contract is bound to restore it to the person
from whom he received it. So, even if the insurer has disbursed the amount covered by
the policy to the insured before the cheque was returned dishonoured, the insurer is
entitled to get the money back.
20. However, if the insured makes up the premium even after the cheque was
dishonoured but before the date of accident it would be a different case as payment of
consideration can be treated as paid in the order in which the nature of transaction
required it. As such an event did not happen in this case, the Insurance Company is
legally justified in refusing to pay the amount claimed by the respondents."
22. A contract is based on reciprocal promise. Reciprocal promises by the parties are
condition precedents for a valid contract. A contract furthermore must be for
consideration.
23. In today's world payment made by cheque is ordinarily accepted as valid tender.
Section 64VB of the 1938 Act also provides for such a scheme.
24

. Payment by cheque, however, is subject to its encashment. In Damadilal and Ors. v.


Parashram and Ors. [(1976) 4 SCC 855], this Court observed : AIR 1976 SC 2229,
(Para 13)

"On the ground of default, it is not disputed that the defendants tendered the amount in
arrears by cheque within the prescribed time. The question is whether this was a lawful
tender. It is well-established that a cheque sent in payment of a debt on the request of the
creditor, unless dishonoured, operates as valid discharge of the debt and, if the cheque
was sent by post and was met on presentation, the date of payment is the date when the
cheque was posted..."
25

. Recently again in New India Assurance Co. Ltd. v. Harshadbhai Amrutbhai Modhiya
and Anr. [(2006) 5 SCC 192], although in the context of the Workmen's Compensation
Act, 1923, Balasubramanyan, J. opined : 2006 AIR SCW 2352, (Para 24)
"It is not brought to our notice that there is any other law enacted which stands in the way
of an insurance company and the insured entering into a contract confining the obligation
of the insurance company to indemnify to a particular head or to a particular amount
when it relates to a claim for compensation to a third party arising under the Workmen's
Compensation Act. In this situation, the obligation of the insurance company clearly
stands limited and the relevant proviso providing for exclusion of liability for interest or
penalty has to be given effect to. Unlike the scheme of the Motor Vehicles Act the
Workmen's Compensation Act does not confer a right on the claimant for compensation
under that Act to claim the payment of compensation in its entirety from the insurer
himself".

It was further observed :- (Para 23)

"The law relating to contracts of insurance is part of the general law of contract. So said
Roskill, L.J. in Cehave v. Bremer. This view was approved by Lord Wilberforce in
Reardon Smith v. Hansen-Tangen (All ER p. 576 h) wherein he said :
"It is desirable that the same legal principles should apply to the law of contract as a
whole and that different legal principles should not apply to different branches of that
law."
A contract of insurance is to be construed in the first place from the terms used in it,
which terms are themselves to be understood in their primary, natural, ordinary and
popular sense. (See Colinvaux's Law of Insurance , 7th Edn., para 2-01.) A policy of
insurance has therefore to be construed like any other contract. On a construction of the
contract in question it is clear that the insurer had not undertaken the liability for interest
and penalty, but had undertaken to indemnify the employer only to reimburse the
compensation the employer was liable to pay among other things under the Workmen's
Compensation Act. Unless one is in a position to void the exclusion clause concerning
liability for interest and penalty imposed on the insured on account of his failure to
comply with the requirements of the Workmen's Compensation Act of 1923, the insurer
cannot be made liable to the insured for those amounts.""
26. We are not oblivious of the distinction between the statutory liability of the Insurance
Company vis-a-vis a third party in the context of Sections 147 and 149 of the Act and its
liabilities in other cases. But
@page-SC771
the same liabilities arising under a contract of insurance would have to be met if the
contract is valid. If the contract of insurance has been cancelled and all concerned have
been intimated thereabout, we are of the opinion, the insurance company would not be
liable to satisfy the claim.
27

. A beneficial legislation as is well known should not be construed in such a manner so as


to bring within its ambit a benefit which was not contemplated by the legislature to be
given to the party. In Regional Director, Employees' State Insurance Corporation, Trichur
v. Ramanuja Match Industries [AIR 1985 SC 278], this Court held - : (Para 10)
"We do not doubt that beneficial legislations should have liberal construction with a view
to implementing the legislative intent but where such beneficial legislation has a scheme
of its own there is no warrant for the Court to travel beyond the scheme and extend the
scope of the statute on the pretext of extending the statutory benefit to those who are not
covered by the scheme."
We, therefore, agree with the opinion of the High Court.
28. However, as the appellant hails from the lowest strata of society, we are of the
opinion that in a case of this nature, we should, in exercise of our extra-ordinary
jurisdiction under Article 142 of the Constitution of India, direct the Respondent No.1 to
pay the amount of claim to the appellants herein and recover the same from the owner of
the vehicle viz., Respondent No.2, particularly in view of the fact that no appeal was
preferred by him. We direct accordingly.
29. We, therefore, allow the appeal with the aforementioned directions. In the facts and
circumstances of the case, however, there shall be no order as to costs.
Order accordingly.
AIR 2008 SUPREME COURT 771 "Quality Inn Southern Star, M/s. v. Regional Director,
Employees' State Insurance Corpn."
(From : Karnataka)*
Coram : 2 Dr. A. PASAYAT AND P. SATHASIVAM, JJ.
Civil Appeal No. 1250 of 2001, D/- 3 -12 -2007.
M/s. Quality Inn Southern Star v. The Regional Director, Employees' State Insurance
Corporation.
Employees' State Insurance Act (34 of 1948), S.2(22) - EMPLOYEES STATE
INSURANCE - WAGES - WORDS AND PHRASES - Memorandum issued by E. S. I.
Corporation No. P11113/97- Ins IV, dt. 6-11-2000 - Wages -Service charges collected by
hotel management from customers and distributed amongst employees - Not "wages"
within meaning of S. 2(22).
(2002) 2 Lab LJ 1002 (Mad), Approved.
M. F. A. 1497 of 1992, D/- 29-7-1999 (Kar), Reversed. (Para 10)
Cases Referred : Chronological Paras
2002 (2) Lab LJ 1002 (Mad.) (Approved) 5, 10
AIR 1976 SC 2303 : 1976 Lab IC 1474 (Ref.) 4
Shyam Divan, Sr. Advocate, Akhil Pal Chhabra, Ms. Sudha Malla and Rajan Narain, for
Appellant; C. S. Rajan, Sr. Advocate, V. J. Francis and Anupam Mishra, for Respondent.
* M.F.A. No. 1497 of 1992, D/- 29-7-1999 (Kar)
Judgement
1. Dr. ARIJIT PASAYAT, J. :- Challenge in this appeal is to the judgment of the learned
Single Judge of the Karnataka High Court dismissing the appeal filed by the appellant.
Challenge was to the order of the Employees' State Insurance Court (in short 'ESI Court')
in ESI application No.123/89. The appeal was filed under Section 82(2) of the
Employees' State Insurance Act, 1948 (in short the 'Act'). Order passed by the ESI Court
was on the petition filed under Section 75 of the Act.
2. Background facts are as follows:
A show-cause notice was issued by the respondent on the report of the ESI Inspector on
9.1.1981 calling upon the appellant to contribute premium for the period November, 1986
to November, 1987 in respect of service charges collected by it. Not being satisfied with
the explanation offered, order was passed under Section 45-A of the Act determining
amount of contribution payable. The order was challenged by the appellant by an
application under Section 75 of the Act. This application was contested by the respondent
and the ESI Court on consideration of the evidence brought before it and it came to hold
that the order under Section 45-A of the Act suffered from no infirmity.
3. According to the appellant, the basic question was whether the service charge collected
by the hotel management from the customers and distributed amongst the
@page-SC772
employees amounted to "wages" within the meaning of Section 2(22) of the Act.
According to the appellant this did not constitute wages. The respondent contended that
the appellant runs a three-star hotel and the establishment is covered under the Act.
Undisputedly, 10% of the total bill amount is compulsorily collected as services charges
and is included in the bills. The service charges so collected are distributed amongst the
employees of the appellant quarterly. The collection of service charges is essentially what
is called as "tips" and paid at the option of customers. The ESI Court held that looking at
the nature of the service charges, these are not directly paid by the customers to the
employees but form part of the bills which the customers are obliged to pay without any
option and this amount so collected is paid or distributed to the employees equally once
in three months. According to the ESI Court the appellant had total control and power of
distribution of the amount and this is distinguishable from "tips". This was treated in any
event covered by the expression "additional reimbursement". The High Court in appeal
upheld the view.
4

. Learned counsel for the appellant submitted that the payments were distributed equally
amongst all the employees periodically, once in three months. It was submitted that by a
circular it was clarified that service charges were outside the scope of wage as defined.
Reference was made to a decision of this Court in The Rambagh Palace Hotel, Jaipur v.
The Rajasthan Hotel Workers' Union, Jaipur (1976 (4) SCC 817). The High Court
distinguished the same holding that it related to "tips" and there was no consideration of
the aspect whether it was covered by the expression "reimbursement". AIR 1974 SC
2303

5. It was pointed out that the judgment of the High Court was delivered on 29.7.1999.
Subsequently, the memorandum was issued by the Corporation bearing No.P-1/13/97-
Ins.IV dated 6.11.2002 clearly stating that service charges of the nature involved in the
present dispute do not form part of the wages. It is also pointed out that the Madras High
Court in a decision in Sathianathan N. and Sons Pvt. Ltd. and Ors. v. E.S.I. Corporation
and Anr. (2002-II LLJ 1002) on 6.2.2002 took a different view.
6. Learned counsel for the respondent on the other hand supported orders of the ESI
Court and the High Court.
7. Section 2(22) defines wages as :
"Wages means all remuneration paid or payable, in cash to an employee or implied, were
fulfilled and includes (any payment to an employee in respect of any period of authorized
leave, lockout, strike which is not illegal or layoff and) other additional remuneration, if
any (paid at intervals not exceeding two months), but does not include
(a) any contribution paid by the employer to any pension fund or provident fund, or under
this act:
(b) any travelling allowance or the value of any travelling concession;
(c) any sum paid to the person employed to defray special expenses entailed on him by
the nature employment; or
(d) any gratuity payable on discharge"
8. The circular referred to by the learned counsel for the appellant reads as follows :
"E. Service charges cannot be included in "wages" for the following reasons-
(a) The Memorandum issued by the ESIC corporation number P11113/97-Ins.IV dated
6.11.2000 clearly states in paragraph 13 that:
"Service Charges are collected by management of the hotel on behalf of their employees
in lieu of direct tips and the same is paid to their employees at a later date. Such amount
collected as 'service charges' will not constitute wages under S. 2(22) of the ESI Act. In
the case of ESIC v. M/s. Rambagh Palace Hotel, Jaipur, the High Court of Jaipur has held
that 'service charges' are not wages under Section 2(22) of the ESI Act. This verdict of the
High Court of Jaipur was accepted in the ESIC and hence no contribution is payable on
'service charges'. (Earlier instructions were issued vide letter No. P. 12/11/4/79 Ins. Desk I
dtd.18.9.79)"
9. The introduction to the memorandum dated 6.11.2000 states that it has been issued
because :
"it is necessary that the instructions issued by this office from time to time are not only
consolidated but certain more items are included not only to clear the doubts of the what
constitutes part of wage under Section 2(22). Some of the instructions were issued long
back rather - as back as in 1967 and certain instructions are not even available in some of
the regions and it is difficult to keep a track on the old instructions. Keeping in view the
above aspects and
@page-SC773
consolidated instructions including some more items are as under:"
(b) In the present case, the amounts received by the employees were not in the nature of
"wages", as they were not given to the employees under the terms of the contract of
employment, either express or implied. The appointment letters expressly state that
employees are not entitled to any other remuneration. Thus the distribution of service
charges is expressly excluded from the wages."
10. In view of the above-said office memorandum and the view taken by the Madras
High Court in Sathianathan's case (supra) the orders of the ESI Court and the High Court
cannot be maintained and are accordingly set aside.
11. The appeal is allowed without any order as to costs.
Appeal allowed.
AIR 2008 SUPREME COURT 773 "Yadvendra Arya v. Mukesh Kumar Gupta"
(From : 2006 (3) All Rent Cas 572)
Coram : 2 Dr. A. PASAYAT AND LOKESHWAR SINGH PANTA , JJ.
Civil Appeal No. 5483 of 2007 (arising out of SLP (C) No. 19545 of 2006), D/- 28 -11
-2007.
Yadvendra Arya and Anr. v. Mukesh Kumar Gupta.
U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act (13 of 1972),
S.21(1)(a) - SHOPS AND ESTABLISHMENT - TENANCY - Bona fide requirement -
Non-residential premises - Father of landlord doing his independent business - Plea by
tenant that landlord can be accommodated in business of his father - Shop in possession
of his father however not so elaborate as to accommodate landlord also - Landlord also
not wanting to join business along with his father but to do independent business in suit
premises - Order directing tenant to vacate shop - Not liable to be set aside - However, as
tenant was doing business in suit premises, time was granted to him to vacate premises.
(Para 17)
Cases Referred : Chronological Paras
2003 AIR SCW 5316 : AIR 2003 SC 4548 (Ref.) 16
2002 AIR SCW 2374 : AIR 2002 SC 2256 (Foll.) 13
2002 AIR SCW 5160 : AIR 2003 SC 532 : 2003 AIR Jhar HCR 150 (Foll.)11
2001 AIR SCW 4841 : AIR 2002 SC 200 : 2001 All LJ 2915 (Foll.) 14
2000 AIR SCW 66 : AIR 2000 SC 534 (Foll.) 12
1999 AIR SCW 2259 : AIR 1999 SC 2226 14
1999 AIR SCW 2666 : AIR 1999 SC 2507 13
1998 AIR SCW 202 : AIR 1998 SC 602 13
1998 AIR SCW 3345 : AIR 1999 SC 22 14
(1996) 5 SCC 353 12
AIR 1980 SC 161 13
AIR 1979 SC 272 (Foll.) 13, 15
Yunus Malik, Abhishek Vikas, Prashant Chaudhary, for Appellants; N. D. B. Raju, C. M.
Angadi, Rameshwar Prasad Goyal, for Respondent.
Judgement
1. Dr. ARIJIT PASAYAT, J. :-Leave granted.
2. Challenge in this appeal is to the order passed by a learned Single Judge of the
Uttranchal High Court allowing the writ petition filed by the respondent. Said respondent
undisputedly is the landlord of the premises which were let out to the present appellants.
3. An application under Section 21(1)(a) of U.P. Urban Buildings (Regulation of Letting,
Rent and Eviction) Act, 1972, (Act No.13 of 1972) (hereinafter referred to as the 'Act')
was filed by the respondent against the appellants praying for the release of the Shop
situated at Mohalla Bazar Ganj (Park Road), Kashipur, District Udham Singh Nagar,
which was under tenancy on the ground that the respondent has passed High School
Certificate Examination and is unemployed and he has no independent business to earn
his livelihood and, therefore, he wants to do the business of Electrical Goods, T.V.,
V.C.R., Music System, Cooking Range etc. in the said Shop.
4. It was, further, stated by the landlord in his release application that his father Sri
Mithilesh Kumar Gupta is doing the independent business in the name of Mithilesh
Kumar and Brothers of which his father is the sole owner and there is no possibility of
employing any other person, as the shop in possession of his father is not so elaborate so
as to accommodate the respondent also. It was also stated that he also does not want to
join the business along with his father, as he wants to do the independent business.
@page-SC774
It has further been stated in the release application that he has already been married in
1994 and is separate from his father and as such, the shop in dispute is required for his
own use and occupation for settling himself in the independent business.
5. A written statement was filed by the present appellants in which it was stated that the
landlord can be accommodated in the business of the father.
6. An affidavit was filed by the respondent who has deposed that he wants to run the
independent business and he cannot settle himself along with his father. So far as the
availability of the other shops are concerned, it was specifically stated that all other shops
are rented accommodation and the tenants are occupying the same.
7. The prescribed authority, Kashipur District Udham Singh Nagar allowed the
application of the respondent directing the appellants to vacate the shop within a period
of 30 days.
8. Being aggrieved the appellants preferred an appeal which was allowed by the appellate
authority. The respondent filed Writ Petition under Article 227 of the Constitution of
India, 1950 (in short the 'Constitution'). The High Court as noted above allowed the writ
petition of the respondent and directed the appellants to vacate the premises.
9. In support of the appeal, it was contented by learned counsel for the appellants that the
parameters relating to bona fide needs and comparative hardship have not been
considered in the proper perspective.
10. Learned counsel for the respondent on the other hand supported the judgment of the
High Court stating that the High Court has kept in view the factual scenario and applied
the appropriate and applicable principles and, therefore, no interference is called for.
11

. So far as the basic need concept is concerned in Akhileshwar Kumar and Others v.
Mustaqim and Others [AIR 2003 SC 532] it was inter alia held as follows : 2002
AIR SCW 5160, (Paras 3 and 4)

"In our opinion, the approach adopted by the High Court cannot be countenanced and has
occasioned a failure of justice. Overwhelming evidence is available to show that the
plaintiff No. 1 is sitting idle, without any adequate commercial activity available to him
so as to gainfully employ him. The plaintiff No. 1 and his father both have deposed to this
fact. Simply because the plaintiff No. 1 is provisionally assisting his father in their family
business, it does not mean that he should never start his own independent business. What
the High Court has overlooked is the evidence to the effect, relied on by the trial Court
too, that the husband of plaintiff No. 4, i.e. son-in-law of Ram Chandra Sao, was assisting
the latter in his business and there was little left to be done by the three sons.
4. So is the case with the availability of alternative accommodation, as opined by the
High Court. There is a shop in respect of which a suit for eviction was filed to satisfy the
need of plaintiff No. 2. The suit was compromised and the shop was got vacated. The
shop is meant for the business of plaintiff No. 2. There is yet another shop constructed by
the father of the plaintiffs which is situated over a septic tank but the same is almost
inaccessible inasmuch as there is a deep ditch in front of the shop and that is why it is
lying vacant and unutilized. Once it has been proved by a landlord that the suit
accommodation is required bona fide by him for his own purpose and such satisfaction
withstands the test of objective assessment by the Court of facts then choosing of the
accommodation which would be reasonable to satisfy such requirement has to be left to
the subjective choice of the needy. The Court cannot thrust upon its own choice on the
needy. Of course, the choice has to be exercised reasonably and not whimsically. The
alternative accommodation which have prevailed with the High Court are either not
available to the plaintiff No. 1 or not suitable in all respects as the suit accommodation is.
The approach of the High Court that an accommodation got vacated to satisfy the need of
plaintiff No. 2, who too is an educated unemployed should be diverted or can be
considered as relevant alternative accommodation to satisfy the requirement of plaintiff
No. 1, another educated unemployed brother, cannot be countenanced. So also
considering a shop situated over a septic tank and inaccessible on account of a ditch in
front of the shop and hence lying vacant cannot be considered a suitable alternative to the
suit shop which is situated in a marketing complex, is easily accessible and has been
purchased by the plaintiffs to satisfy the felt need of one of them."
@page-SC775
12

. In Ragavendra Kumar v. Firm Prem Machinery and Co. [2000(1) SCC 679] it was held
as follows : 2000 AIR SCW 66, (Para 10)

"It is settled position of law that the landlord is best judge of his requirement for
residential or business purpose and he has got complete freedom in the matter. (See:
Prativa Devi (Smt.) v. T.V. Krishnan, [(1996)5 SCC 353]. In the case in hand the plaintiff-
landlord wanted eviction of the tenant from the suit premises for starting his business as it
was suitable and it cannot be faulted."
13

. In Joginder Pal v. Naval Kishore Behal [(2002(5) SCC 397) it was held as follows :
2002 AIR SCW 2374, (Paras 5, 7, 8, 30, 31)

"In Malpe Vishwanath Acharya and Ors. v. State of Maharashtra and Anr. (1998 2 SCC 1)
this Court emphasized the need of social legislations like the Rent Control Act striking a
balance between rival interests so as to be just to law. "The law ought not to be unjust to
one and give a disproportionate benefit or protection to another section of the society".
While the shortage of accommodation makes it necessary to protect the tenants to save
them from exploitation but at the same time the need to protect tenant is coupled with an
obligation to ensure that the tenants are not conferred with a benefit disproportionately
larger than the one needed. Socially progressive legislation must have a holistic
perception and not a shortsighted parochial approach. Power to legislate socially
progressive legislation is coupled with a responsibility to avoid arbitrariness and
unreasonability. A legislation impregnated with tendency to give undue preference to one
section, at the cost of constraints by placing shackles on the other section, not only entails
miscarriage of justice but may also in constitutional invalidity. 1998 AIR SCW 202

xxx xxx xxx

The need for reasonable interpretation of rent control legislations was emphasized by this
Court in Bega Begum v. Abdul Ahad Khan (AIR 1979 SC 273). Speaking in the context
of reasonable requirement of landlord as a ground for eviction, the Court guarded against
any artificial extension entailing stretching or straining of language so as to make it
impossible or extremely difficult for the landlord to get a decree for eviction. The Court
warned that such a course would defeat the very purpose of the Act which affords the
facility of eviction of the tenant to the landlord on certain specified grounds. In Kewal
Singh v. Lajwanti (1980) 1 SCC 290) this Court has observed, while the rent control
legislation has given a number of facilities to the tenants, it should not be construed so as
to destroy the limited relief which it seeks to give to the landlord also. For instance, one
of the grounds for eviction which is contained in almost all the Rent Control Acts in the
country is the question of landlord's bona fide personal necessity. The concept of bona
fide necessity should be meaningfully construed so as to make the relief granted to the
landlord real and practical. Recently in Shiv Sarup Gupta v. Dr Mahesh Chand Gupta
(1999) 6 SCC 222) the Court has held that the concept of bona fide need or genuine
requirement needs a practical approach instructed by the realities of life. An approach
either too liberal or too conservative or pedantic must be guarded against. AIR 1980 SC
161
1999 AIR SCW 2666

9. The rent control legislations are heavily loaded in favour of the tenants treating them as
weaker sections of the society requiring legislative protection against exploitation and
unscrupulous devices of greedy landlords. The legislative intent has to be respected by
the courts while interpreting the laws. But it is being uncharitable to legislatures if they
are attributed with an intention that they lean only in favour of the tenants and while
being fair to the tenants, go to the extent of being unfair to the landlords. The legislature
is fair to the tenants and to the landlords - both. The courts have to adopt a reasonable and
balanced approach while interpreting rent control legislations starting with an assumption
that an equal treatment has been meted out to both the sections of the society. In spite of
the overall balance tilting in favour of the tenants, while interpreting such of the
provisions as take care of the interest of the landlord the court should not hesitate in
leaning in favour of the landlords. Such provisions are engrafted in rent control
legislations to take care of those situations where the landlords too are weak and feeble
and feel humble.
xxx xxx xxx
In providing key to the meaning of any word or expression the context in which it is set
has significance. Color and content emanating from context may permit sense
@page-SC776
being preferred to mere meaning depending on what is sought to be achieved and what is
sought to be prevented by the legislative scheme surrounding the expression.
Requirement of landlord for his own use, is an expression capable for attributing an
intention to the legislature that what was intended to be fulfilled is such requirement as
would persuade the landlord to have the premises vacated by the tenant, to forego the
rental income, and to put the premises to such use as the landlord would deem to be his
own use and in the given facts and circumstances of a case the Court too would hold it to
be so in contradistinction with a mere ruse to evict the tenant. The legislature intending to
protect the tenant also intends to lift the protection when it is the requirement of landlord
to put the accommodation to such use as he intends, away from leasing it out.
xxx xxx xxx
32. If we do not meaningly construe the concept of requirement the provision may suffer
from the risk of being branded as unreasonable, arbitrary or as placing uncalled for and
unreasonable restrictions on the right of the owner to hold and use his property. We
cannot place a construction on the expression 'for his own use' in such a way as to deny
the landlord a right to evict his tenant when he needs the accommodation for his own son
to settle himself well in his life. We have to give colour and content to the expression and
provide the skin of a living thought to the skeleton of the words, which the Legislature
has not itself chosen to define. The Indian society, its customs and requirements and the
context where the provision is set in the legislation are the guides leading to acceptance
of the meaning which we have chosen to assign to the words 'for his own use' in Section
13(3)(a)(ii) of the Act.
33.(1) In the present case, the requirement of landlord of the suit premises for user as
office of his chartered accountant son is the requirement of landlord 'for his own use'
within the meaning of Section 13(3)(a)(ii)."
14

. Again in G. C. Kapoor v. Nand Kumar Bhasin (AIR 2002 SC 200) it was noted as
follows : 2001 AIR SCW 4841

"It is settled position of law that bona fide requirement means that requirement must be
honest and not tainted with any oblique motive and is not a mere desire or wish. In
Dattatraya Laxman Kamble v. Abdul Rasul Moulali Kotkunde and Anr. (1999 (4) SCC 1)
this Court while considering the bona fide need of the landlord was of the view that when
a landlord says that he needs the building for his own occupation, he has to prove it but
there is no warrant for 'presuming that his need is not bona fide'. It was also held that
while deciding this question. Court would look into the broad aspects and if the Courts
feels any doubt about bona fide requirement, it is for the landlord to clear such doubt.
1999 AIR SCW 2259

10. In Raghunath G. Panhale (D) By LRs. v. Chaganlal Sundarji and Co. (1999 (8) SCC
1) his Court inter alia held that it was not necessary for landlord to prove that he had
money to invest in the new business contemplated nor that he had experience of it. It was
a case for eviction on the ground of bona fide requirement of the landlord for non-
residential purpose, as he wanted to start a grocery business in the suit premises to
improve his livelihood." 1998 AIR SCW 3345

15

. In Mst. Begam Begum and Ors. v. Abdul Ahad Khan (d) by LRs and Ors. (1979 (1)
SCC 273) this Court had occasion to deal in detail with the comparative hardships aspect
as follows: AIR 1979 SC 272

"Moreover Section 11(h) of the Act uses the words 'reasonable requirement' which
undoubtedly postulate that there must be an element of need as opposed to a mere desire
or wish. The distinction between desire and need should doubtless be kept in mind but
not so as to make even the genuine need as nothing but a desire as the High Court has
done in this case. It seems to us that the connotation of the term 'need' or 'requirement'
should not be artificially extended nor its language so unduly stretched or strained as to
make it impossible or extremely difficult for one landlord to get a decree for eviction.
Such a course would defeat the very purpose of the Act which affords the facility of
eviction of the tenant to the landlord on certain specified grounds. This appears to us to
be the general scheme of all the Rent Control Acts, prevalent in other State in the country.
This Court has considered the import of the word requirement and pointed out that it
merely connotes that there should be an element of need.
@page-SC777
In this connection our attention was drawn to the evidence led by the defendants that the
main source of their income is the hotel business carried on by them in the premises and
if they are thrown out they are likely to get any alternative accommodation. The High
Court has accepted the case of the defendants on this point, but does not appear to have
considered the natural consequences, which flow from a comparative assessment of the
advantages and disadvantages of the landlord and the tenant if a decree for eviction
follows. It is no doubt true that the tenant will have to be ousted from the house if a
decree for eviction is passed, but such an event would happen whenever a decree for
eviction is passed and was fully in contemplation of the legislature when Section 11(1)(h)
of the Act was introduced in the Act. This by itself would not be valid ground for refusing
the plaintiffs for eviction.
Thus, on careful comparison and assessment of the relative advantage and disadvantages
of the landlord and the tenant it seems to us that the scale is titled in favour of the
plaintiff. The inconvenience, loss and trouble resulting from denial of a decree for
eviction in favour of the plaintiffs far outweight the eviction from that point of view."
16

. It is to be noted that learned counsel for the appellants submitted that the matter should
have been remanded to the authorities for further consideration. Such a practice has been
deprecated by this Court in a large number of cases. [See: R.V.E. Venkatachala Gounder
v. Arulmigu Viswesaraswami and V.P. Temple and Anr. (2003 (8) SCC 752)]. 2003
AIR SCW 5316

17. Considering the factual background in the light of the principles as stated above, the
inevitable conclusion is that this appeal is without merit. Considering the fact that the
appellants are carrying on the business in the premises, time is granted to them to vacate
the premises in question by the end of June, 2008 subject to filing the usual undertaking
with the prescribed authority within a period of four weeks from today.
18. Appeal is dismissed but without any order as to costs.
Appeal dismissed.
AIR 2008 SUPREME COURT 777 "U.P. State Agro Industrial Corporation Ltd. v. Kisan
Upbhokta Parishad"
(From : Allahabad)
Coram : 2 A. K. MATHUR AND MARKANDEY KATJU, JJ.
Civil Appeal No. 7285 of 2001, D/- 7 -12 -2007.
U. P. State Agro Industrial Corporation Ltd. v. Kisan Upbhokta Parishad and Ors.
(A) INTERPRETATION OF STATUTES - Interpretation of Statutes - Word used - To be
given popular meaning - Unless statute/order has given it specific meaning - Language is
a tool of communication between human beings, and hence that meaning should be given
which helps communication between people. (Paras 11, 15)
(B) INTERPRETATION OF STATUTES - WORDS AND PHRASES - Interpretation of
Statutes - Words "agricultural implement" - Would not cover Animal driven vehicle
(A.D.V.) - Implement means tools - A. D. V. is not implement.
In common parlance implements are usually regarded as tools used by human beings with
their hands and sometimes with their legs, or driven by animal power. Thus, a plough
which is driven by oxen or horses would be regarded as an agricultural implement.
Similarly, a hoe or a spade would be agricultural implements. However, a bullock cart
which is used for carrying the agricultural produce from the farm to the market or the
sugar factory cannot, be regarded as an agricultural implement, because in common
parlance it would not be regarded by people as an implement. A bullock cart is surely not
a tool, though the plough which it pulls is certainly a tool and therefore, an agricultural
implement.
(Para 16)
(C) INTERPRETATION OF STATUTES - PRINCIPLES - Interpretation of Statutes -
Mimansa Principles of Interpretation can be used on appropriate occasion - Rare use of
the principles in our law Courts, regrettable. (Para 20)
Cases Referred : Chronological Paras
(2006) 12 JT (SC) 379 (Ref.) 19
1991 AIR SCW 2119 : AIR 1991 SC 1992 (Ref.) 17
(1892) ILR 14 All 67 (FB) 19
Rajesh, for Appellant; Vijay K. Jain, for Respondents.
Judgement
1. MARKANDEY KATJU, J. - :- This appeal has been filed against the impugned
@page-SC778
judgment of the Allahabad High Court dated 22.2.2000 in Writ Petition No.23662 of
1999.
2. Heard learned counsel for the parties and perused the record.
3. The respondent in this appeal, which is a Union of cane growers and looks after the
interest of sugarcane farmers in Meerut District, was the petitioner in the writ petition
before the Allahabad High Court. It was alleged in the writ petition that cane growers of
the area require implements and other equipments for agriculture. For this purpose it
purchases Animal Driven Vehicles (hereinafter called "ADV carts") in order to transport
the sugarcane from the agriculture fields to the sugar factories or other places where it is
required to be sent. The State Government from time to time has provided a subsidy on
the purchase of ADV carts and other agricultural implements.
4. It appears that the State Government issued an order dated 20.11.1996 stating that all
kinds of agricultural implements driven by hand operation or animal power should be
purchased from the U.P. State Agro Industrial Limited. The short question in the writ
petition before the High Court was whether the ADV carts are agricultural implements. If,
they are then in order to get subsidy, purchases had to be made only from the Corporation
and not from other parties.
5. The Cane Commissioner, U.P. issued a letter dated 5.3.1999, copy of which is
Annexure P-2 to this appeal, stating that in pursuance of the aforesaid Government order
dated 20.11.1996 of the U.P. Government, ADV carts can only be purchased from the
U.P. State Agro Industrial Limited. This order dated 5.3.1999 of the Cane Commissioner
was challenged in the writ petition on the ground that it was in conflict with the
Government order dated 20.11.1996.
6. The short question in this appeal is whether ADV carts are also agricultural
implements.
7. The Concise Oxford English Dictionary (Tenth Edn. Revised) defines implement "as a
tool, utensil or other piece of equipment used for a particular purpose". The same
dictionary defines 'tool' "as" a device or implement, typically hand-held, used to carry out
a particular function.
8. In Webster Comprehensive Dictionary (International Edn.) the word 'implement' has
been defined as "a thing used in work, especially in manual work; a utensil; tool". In the
same dictionary the word 'tool' has been defined as a "simple mechanism or implement,
as a hammer, saw, spade, or chisel, used chiefly in the direct manual working, moving,
shaping, or transforming of material".
9. In Advanced Law Lexicon by P. Ramanatha Aiyar (3rd edn. 2005) the word 'tool' has
been defined as "things designed to help the hand in work, especially in industrial
operations".
10. One word can have several meanings, and several words can have the same meaning
(synonyms). Thus, for example, the word 'ball' can mean the spherical object used in a
game, or it can also mean a dance; it can also mean having a nice time, etc. Similarly,
several words can have the same meaning e.g. the Sanskrit words 'pankaj', 'jalaj', 'kamal',
'padma', 'saroj', 'sarsij', etc. which all mean 'Lotus'.
11. No doubt the word 'implement' can have several dictionary meanings. However, in
interpretation it is well settled that ordinarily the meaning of the word or expression in
common parlance or in common use should be accepted, unless the statute or order in
which it is used has defined it with a specific meaning. There is no definition of the word
'implements' in the G.O. of the State Government dated 20.11.1996.
12. In the Mimansa Rules of Interpretation, which is our indigenous system of
interpretation, one of the principles is - :
(Vernacular Matter omitted-Ed.)
13. The above principle means the popular meaning overpowers the etymological
meaning".
14. For example, the word 'pankaja' literally means whatever grows in mud. The word
'panka' means 'mud', and the suffix 'ja' means 'which is born in'. Hence the etymological
meaning of the word 'pankaja' is 'that which is born in mud'. Thus literally there can be
several things which could mean 'pankaja' e.g. worms or insects born in mud, all kinds of
vegetation which are born and found in mud, etc. However, by popular usage the word
'pankaja' has acquired a particular meaning in common parlance i.e. lotus. This shows
that we should prefer the popular meaning or the meaning in common usage to the literal
meaning of a word.
15. The reason behind this principle is
@page-SC779
that language is a tool of communication between human beings, and hence that meaning
should be given to a word which helps communication between people. If the speaker of
a word uses it in one sense but the hearer understands it in another sense, there will be a
communication gap. Hence that meaning should be attributed to a word which everyone
would understand as it has acquired a special meaning in common parlance.
16. Keeping the above principle in mind we may now consider whether an Animal
Driven Vehicle can be said to be an agricultural implement. In our opinion it cannot, for
the obvious reasons that in common parlance implements are usually regarded as tools
used by human beings with their hands (and sometimes with their legs), or driven by
animal power. Thus, a plough which is driven by oxen or horses would be regarded as an
agricultural implement. Similarly, a hoe or a spade would be agricultural implements.
However, a bullock cart which is used for carrying the agricultural produce from the farm
to the market or the sugar factory cannot, in our opinion, be regarded as an agricultural
implement, because in common parlance it would not be regarded by people as an
implement. A bullock cart is surely not a tool, though the plough which it pulls (for
furrowing the land) is certainly a tool and therefore, an agricultural implement.
17

. Learned counsel for the respondent has relied on the decision of this Court in M/s. D.H.
Brothers Pvt. Ltd. vs. Commissioner of Sales Tax, U.P., AIR 1991 SC 1992, in which it
was held that sugarcane crushers are not agricultural implements. In that decision this
Court held that a sugarcane crusher is not used in the agricultural operation, rather it is
only when the agricultural operations have ended and the cane harvested and transported
to the cane crusher that the activity of the cane crusher begins. Learned counsel submitted
that in the present case also the ADV carts which are used for transporting the sugarcane
from the agricultural field to the sugar factory are not part of the agricultural operations,
as these ADV carts begin their activity of transportation only after the agricultural
operations are over. 1991 AIR SCW 2119

18. It is not necessary for us to deal with this submission because we have earlier held
that an ADV cart is not an agricultural implement since it is not a tool. In view of the
above we find no merit in this appeal and it is accordingly dismissed. No costs.
19. Before parting with this case, we would like to say that it is deeply regrettable that in
our Courts of law, lawyers quote Maxwell and Craies but nobody refers to the Mimansa
Principles of Interpretation. Today our so-called educated people are largely ignorant
about the great intellectual achievements of our ancestors and the intellectual treasury
they have bequeathed us. The Mimansa Principles of Interpretation is part of that
intellectual treasury, but it is distressing to note that apart from a reference to these
principles in the judgment of Sir John Edge, the then Chief Justice of Allahabad High
Court, in Beni Prasad vs. Hardai Devi, (1892) ILR 14 All 67 (FB), there has been almost
no utilization of these principles even in our own country (except by one of us, M. Katju,
J. in some of his judgments delivered at Allahabad High Court and in this Court vide M/s.
Ispat Industries Ltd. vs. Commissioner of Customs, Mumbai, JT 2006(12) SC 379.
20. It may be mentioned that the Mimansa Rules of Interpretation were our traditional
principles of interpretation laid down by Jaimini whose Sutras were explained by Shabar,
Kumarila Bhatta, Prabhakar, etc. These Mimansa Principles were regularly used by our
great jurists like Vijnaneshwar (author of Mitakshara), Jimutvahana (author of
Dayabhaga), Nanda Pandit (author of 'Dattak Mimansa') etc. whenever they found any
conflict between the various Smritis or any ambiguity or incongruity therein. There is no
reason why we cannot use these principles on appropriate occasions. However, it is a
matter of deep regret that these principles have rarely been used in our law Courts. It is
nowhere mentioned in our Constitution or any other law that only Maxwells Principles of
Interpretation can be used by the Court. We can use any system of interpretation which
helps us solve a difficulty. In certain situations Maxwells principles would be more
appropriate, while in other situations the Mimansa principles may be more suitable.
21. Since we have used a Mimansa principle in this judgment we thought it necessary to
briefly mention about the Mimansa principles of interpretation (the original works on
Mimansa are all in Sanskrit, but there is a very elucidating book in English
@page-SC780
on the subject by K.L. Sarkar called 'The Mimansa Rules of Interpretation' published in
the Tagore Law Lecture Series).
Appeal dismissed.
AIR 2008 SUPREME COURT 780 "Vineet Kumar Chauhan v. State of U. P."
(From : 2005 All LJ 3784)
Coram : 2 PRAKASH PRABHAKAR NAOLEKAR AND D. K. JAIN, JJ.
Criminal Appeal No. 35 of 2006, D/- 14 -12 -2007.
Vineet Kumar Chauhan v. State of U.P.
(A) Evidence Act (1 of 1872), S.45 - Penal Code (45 of 1860), S.300 - EVIDENCE -
MURDER - FIRE ARMS - Expert opinion - Necessity - Offence by use of fire-arm -
Ballistic Expert evidence - Absence of - Not always fatal to prosecution case.
It cannot be laid down as a general proposition that in every case where a firearm is
allegedly used by an accused person, the prosecution must lead the evidence of a Ballistic
Expert to prove the charge, irrespective of the quality of the direct evidence available on
record. It needs little emphasis that where direct evidence is of such an unimpeachable
character, and the nature of injuries, disclosed by post-mortem notes is consistent with the
direct evidence, the examination of Ballistic Expert may not be regarded as essential.
However, where direct evidence is not available or that there is some doubt as to whether
the injuries could or could not have been caused by a particular weapon, examination of
an expert would be desirable to cure an apparent inconsistency or for the purpose of
corroboration of oral evidence. (Para 10)
In the instant case when the ocular evidence is totally consistent with the opinion of
doctors who have given injury report and the post-mortem report and it was clear that the
bullet fired from revolver by accused had damaged the spinal cord of the victim leading
to paralysis of both lower limbs of victim and consequent death, the absence of Ballistic
Expert's evidence is not fatal to the case of prosecution, notwithstanding the fact that the
Forensic Science Laboratory, in its report had not expressed a difinite opinion about the
bullet recovered from the place of occurrence. (Para 12)
(B) Penal Code (45 of 1860), S.300, S.299 - MURDER - CULPABLE HOMICIDE -
Murder or culpable homicide not murder - Accused and victim neighbourers - Incident
preceded by altercation between accused and family member of victim - Accused
returning to his house in a huff - Taking revolver of his father - Firing indiscriminately
towards victim's house - Victim trying to close door getting hit by bullet which proved
fatal - Accused at best can be said to have knowledge that use of revolver was likely to
cause death - Liable to be convicted under S. - 299, Cl. (3) and not under S. 300. (Para
16)
Cases Referred : Chronological Paras
2001 AIR SCW 2441 : AIR 2001 SC 2408 : 2001 Cri LJ 3292 (Disting.) (Pt. A) 8
AIR 1977 SC 45 : 1977 Cri LJ 1 (Rel. on) 15
AIR 1966 SC 1874 : 1966 Cri LJ 1509 (Ref.) 15
AIR 1963 SC 340 : 1963 (1) Cri LJ 323 (Rel. on) (Pt. A) 10
AIR 1958 SC 465 : 1958 Cri LJ 818 ((Ref.) 15
AIR 1953 SC 415 : 1953 Cri LJ 1761 (Disting.) (Pt. A) 8, 11
Sushil Kumar, Sr. Advocate, Vinay Arora, Aditya Kumar, Sudarshan Singh Rawat, Anmol
Thakral and Sanjay Jani, for Appellant; Ratnakar Das, Sr. Advocate, T. N. Singh, Rajeev
Dubey and Kamlendra Mishra, for Respondent.
Judgement
1

. D. K. JAIN, J. :- This appeal under Section 2(a) of the Supreme Court (Enlargement of
Criminal Appellate Jurisdiction) Act, 1970 has been preferred against the judgment of the
High Court of Judicature at Allahabad in Government Appeal No. 415 of 2000. By the
impugned judgment, the appeal filed by the State of Uttar Pradesh has been allowed and
the appellant-Vineet Kumar Chauhan has been convicted under Section 302 of the Indian
Penal Code, ('IPC' for short) for causing the murder of Smt. Premwati. He has been
sentenced to suffer imprisonment for life. Reported in 2005 All LJ 3784

2. The genesis of the prosecution case, in brief, was that on 13.10.1993 at about 11.50
a.m., one Sri Krishna Sharma (P.W.1), husband of the deceased, lodged an F.I.R. with the
Police Station Majhola, District Moradabad to the effect that on that day, at
@page-SC781
about 9.45 a.m., when he along with his wife and children was watching television, the
appellant who was living opposite their house and was a cable operator along with his
servant Dharamveer, came to their house and tried to persuade his son-Ravindra Sharma
(P.W.2) to take a cable connection from them. Not being interested in the cable
connection, they declined the request of the appellant whereupon an altercation took
place between the appellant and P.W.2. The complainant and his wife intervened and
asked the appellant to leave their house. The appellant went to his house, brought out the
licensed revolver of his father and opened indiscriminate firing towards complainant's
house from the door of his house. Some bullets hit the door of the house of Sri Krishna
Sharma and while his wife, the victim, was closing the door, one of the bullets hit her in
the jaw. Sri Krishna Sharma brought his injured wife to the hospital for treatment and
thereafter lodged the F.I.R.
3. The victim was examined by Dr. Jagmal Singh, P.W.4. The following injuries were
found on her person :
1. Lacerated wound 1.5 cm. x .5 cm x not probed on face, left side over left mandible, 3
cm. below and outer to left angle of mouth. Advised X-ray of left side face and left side
neck.
2. Lacerated wound .5 cm x .5 cm x skin on left arm outer part, 4 cm. above left elbow.
4. Both the injuries were found to be fresh. Injury No.1 was alleged to have been caused
by firearm but final opinion was reserved to be given after the X-ray. Injury No.2 was
caused by a blunt object. On X-ray being taken, a radio opaque shadow elongated was
found in thoracic spine in dorsal region over T 5-6.
5. The victim remained under treatment and supervision of Dr. D.S. Ahlawat (P.W.5). On
15.10.1993, she was taken to Delhi for treatment. However, on 21.10.1993, she was again
admitted in Moradabad Hospital, where she developed bedsores. Smt. Premwati
ultimately died on 25.3.1994. As per the autopsy conducted by Dr. S.P. Singh (P.W.7) on
25.3.1994, the ante-mortem injuries were mainly deep bedsores on various parts of the
body and one old healed scar, size 1.2 cm x .5 cut, on the left face at the chin 2.5 cm.
away from medium plank thoracic spine. On internal examination, the doctor recovered a
metallic bullet from her spinal cord, which had caused extensive damage in thoracic spine
and paralysis in half of the body. The cause of death was opined to be septicemia and
toxemia due to bedsores. After investigations, charge-sheet under Sections 452 and 307
was filed against the appellant and his father. However, charges were framed against
them under Sections 302 and 307, IPC.
6. In support of the case, the prosecution examined seven witnesses, including Sri
Krishna Sharma (P.W.1) and Ravindra Sharma (P.W.2), who claimed to be the eye-
witnesses. As per testimony of P.W.5, the deceased had suffered paralysis in both her legs
due to bullet injury sustained in the spinal cord. The Trial Court found the evidence to be
insufficient to warrant conviction of both the accused. Doubting the presence of P.W.1-Sri
Krishna Sharma and P.W.2-Ravindra Sharma at the spot and inter alia, observing that
from the report of the Ballistic Expert it could not be established that the lead (from part
of the bullet) recovered from the spot pertained to a shot fired from revolver recovered
from the house of the accused-Vineet Kumar and that deceased had actually died of
septicemia and toxemia owing to bedsores, as she was not properly advised and attended
to while she was admitted in hospital and death was attributable to the negligence and
bedsore, the Trial Court directed their acquittal.
7. On appeal by the State, the High Court affirmed the acquittal of Dharamveer. Insofar
as the case of the appellant was concerned, the High Court found the ocular evidence qua
him to be perfectly in harmony with the medical evidence. Concluding that the appellant
did commit the offence of murder, as noted above, the High Court convicted him under
Section 302, I.P.C. It is this conviction and sentence which has been challenged in this
appeal.
8

. Mr. Sushil Kumar, learned senior counsel appearing on behalf of the appellant assailed
the conviction of the appellant mainly on the ground that apart from the fact that the
Ballistic Report casts a serious doubt that the distorted bullet allegedly recovered from
the spot came out of the seized revolver, it was also obligatory on the part of the
prosecution to send the bullet, allegedly recovered from the body of the deceased, for
being examined by the Ballistic Expert, so as AIR 1953 SC 415
2001 AIR SCW 2441

@page-SC782
to connect the recovered licensed revolver of the appellant's father with the crime. It was
submitted that since it was a positive case of the prosecution that the bullet which had hit
the deceased was fired from the seized revolver, omission to send the bullet for ballistic
examination is a serious infirmity in the prosecution case, which assumes still greater
significance because of Ballistic Report, which does not even establish that the remnants
of the bullet (lead), recovered from the place of incident, was of the bullet fired from the
revolver allegedly used by the appellant. In support, strong reliance is placed on the
decision of this Court in Mohinder Singh v. The State1, wherein it was observed that in a
case where death is due to injuries or wounds caused by a lethal weapon, it has always
been considered to be the duty of the prosecution to prove by expert evidence that it was
likely or at least possible for the injuries to have been caused with the weapon with which
and in the manner in which they are alleged to have been caused. Reference is also made
to another decision of this Court in State of M.P. v. Surpa2, expressing a similar view.
Learned counsel has also contended that all through the case of the prosecution was that
the accused was firing towards the house of the deceased without aiming at any person
and the bullet hit the deceased accidentally when she was closing the door of the house. It
is urged that in case the appellant had any intention to commit the murder of the deceased
or any member of her family, he would have gone to their house and shot them. It is
argued that even if the occurrence is admitted to have taken place in the manner alleged,
the appellant cannot be held guilty for the commission of offence punishable under
Section 302, IPC. It is asserted that the occurrence having taken place without pre-
meditation, in the heat of the passion upon a sudden quarrel, the appellant is entitled to
the benefit of Exception 4 of Section 300, IPC.
1 (1950) 1 SCR 821)
2 (2002) 9 SCC 447)
9. Learned counsel for the State, on the other hand, supported the view taken by the High
Court.
10

. It cannot be laid down as a general proposition that in every case where a firearm is
allegedly used by an accused person, the prosecution must lead the evidence of a Ballistic
Expert to prove the charge, irrespective of the quality of the direct evidence available on
record. It needs little emphasis that where direct evidence is of such an unimpeachable
character, and the nature of injuries, disclosed by post-mortem notes is consistent with the
direct evidence, the examination of Ballistic Expert may not be regarded as essential.
However, where direct evidence is not available or that there is some doubt as to whether
the injuries could or could not have been caused by a particular weapon, examination of
an expert would be desirable to cure an apparent inconsistency or for the purpose of
corroboration of oral evidence. (See: Gurcharan Singh v. State of Punjab3) AIR
1963 SC 340

3 (1963) 3 SCR 585)


11

. In Mohinder Singh's case (supra) on which strong reliance is placed on behalf of the
appellant, this Court has held that, where the prosecution case was that the accused shot
the deceased with a gun, but it appeared likely that the injuries on the deceased were
inflicted by a rifle and there was no evidence of a duly qualified expert to prove that the
injuries were caused by a gun, and the nature of the injuries was also such that the shots
must have been fired by more than one person and not by one person only, and the
prosecution had no evidence to show that another person also shot, and the oral evidence
was of witnesses who were not disinterested, the failure to examine an expert would be a
serious infirmity in the prosecution case. It is plain that these observations were made in a
case where the prosecution evidence was suffering from serious infirmities. Thus, in
determining the effect of these observations, the facts in respect of which these
observations came to be made cannot be lost sight of. The said case, therefore, cannot be
held to lay down an inflexible rule that in every case where an accused person is charged
with murder caused by a lethal weapon, the prosecution case can succeed in proving the
charge only if Ballistic Expert is examined. In what cases, the examination of a Ballistic
Expert is essential for the proof of the prosecution case, must depend upon the facts and
circumstances of each case. AIR 1953 SC 415

12. In the instant case, having regard to the ocular evidence adduced by the prosecution,
there is no reason to discard the
@page-SC783
prosecution theory that the injury as a result whereof Smt. Premwati suffered complete
paralysis of both the lower limbs etc. was caused by a bullet fired from a revolver. The
nature of the injury as proved by Dr. P. S. Ahlawat (P.W.5), under whose treatment the
deceased remained at Moradabad and Dr. S. P. Singh (P.W.7), who had conducted the
post-mortem examination is wholly consistent with the prosecution version. It is clear
that the bullet recovered by P.W.7 at the time of post-mortem of the victim had traversed
to thoracic spine through the neck from the face near the angle of the jaw, hitting the fifth
thoracic vertebra, badly damaging the underlying spinal cord. We are, therefore, of the
view that on the facts of the present case, the absence of Ballistic Expert's evidence is not
fatal to the case of the prosecution, notwithstanding the fact that the Forensic Science
Laboratory, in its report dated 18.2.1991, had not expressed a definite opinion about the
bullet recovered from the place of occurrence.

13. Insofar as the testimonies of P.W.1 and P.W.2, the two star witnesses of the
prosecution, are concerned, from the impugned judgment, it is manifest that the High
Court, on analysis of their statements, has found these to be trustworthy. The High Court
has observed that testimony of these two natural witnesses is of sterling character with no
holes whatsoever. Based on this evidence, the High Court has found that it was the
appellant who had opened fire from the revolver from his door, one of which had hit the
victim, who had come to close the main door of her house. Nothing has been shown to us
so as to warrant interference with the said finding recorded by the High Court. Therefore,
in the context of this unimpeachable evidence, it stands proved that the appellant had
gone to the house of the deceased; some unsavoury incident took place there; he returned
to his house in a huff; took out the revolver of his father and fired shots towards the house
of the deceased; one of the bullets hit the deceased and the same proved to be fatal.
Having bestowed our anxious consideration to the evidence on record, in particular the
testimony of P.W.1 and P.W. 2, we are of the opinion that the High Court was correct in
coming to the conclusion that the appellant was responsible for causing the fatal injury to
the deceased. We are also in agreement with the High Court that though as per the post-
mortem report the deceased died of septicemia and toxemia because of bedsores, the
basic cause of her death was the bullet injury caused to her by the appellant.
14. However, the next question for consideration is whether the offence established by
the prosecution against the appellant is "murder"- as held by the High Court or "culpable
homicide not amounting to murder"- as contended on behalf of the appellant?
15

. The academic distinction between "murder" and "culpable homicide not amounting to
murder" has been vividly brought out by this Court in State of Andhra Pradesh v.
Rayavarapu Punnayya and another4. It has been observed that the safest way of approach
to the interpretation and application of Sections 299 and 300, IPC is to keep in focus the
key words used in various clauses of the said Sections. Minutely comparing each of the
clauses of Sections 299 and 300, IPC and drawing support from the decisions of this
Court in Virsa Singh v. State of Punjab5and Rajwant v. State of Kerala6, speaking for the
Court, R. S. Sarkaria, J. neatly brought out the points of distinction between the two
offences, which have been time and again reiterated. Having done so, the court said that
whenever a Court is confronted with the question whether the offence is "murder" or
"culpable homicide not amounting to murder", on the facts of a case, it will be convenient
for it to approach the problem in three stages. The question to be considered at the first
stage would be, whether the accused has done an act by doing which he has caused the
death of another. Proof of such causal connection between the act of the accused and the
death, leads to the second stage for considering whether that act of the accused amounts
to "culpable homicide" as defined in Section 299. If the answer to this question is prima
facie found in the affirmative, the stage for considering the operation of Section 300,
Penal Code, is reached. This is the stage at which the court should determine whether the
facts proved by the prosecution bring the case within the ambit of any of the four clauses
of the definition of "murder" contained in Section 300. If the answer to this question is in
the AIR 1977 SC 45
AIR 1958 SC 465
AIR 1966 SC 1874

@page-SC784
negative the offence would be "culpable homicide not amounting to murder", punishable
under the first or the second part of Section 304, depending, respectively, on whether the
second or the third clause of Section 299 is applicable. If this question is found in the
positive, but the case comes within any of the Exceptions enumerated in Section 300, the
offence would still be "culpable homicide not amounting to murder", punishable under
the first part of Section 304, Penal Code. It was, however, clarified that these were only
broad guidelines to facilitate the task of the Court and not cast iron imperative.
4 (1976) 4 SCC 382
5 1958 SCR 1495
6 1966 Supp SCR 230
16. Reverting to the facts in hand, as noted above, it stands proved that there being a
direct causal connection between the hitting of the bullet, fired by the appellant, to the
deceased and her death, the death of the deceased was caused by the appellant. However,
having regard to the circumstances, briefly enumerated above, particularly the manner in
which the appellant fired the shots, in our view, the appellant could not be attributed the
mens rea requisite for bringing the case under clause (3) of Section 300, IPC.
Concededly, there was no enmity between the parties and there is no allegation of the
prosecution that before the occurrence, the appellant had pre-meditated the crime of
murder. We are inclined to think that having faced some sort of hostile attitude from the
family of the deceased over the cable connection, a sudden quarrel took place between
the appellant and the son of the deceased, on account of heat of passion, the appellant
went home; took out his father's revolver and started firing indiscriminately, and
unfortunately one of the bullets hit the deceased on her chin. At the most, it can be said
that he had the knowledge that the use of revolver was likely to cause death and, as such,
the present case would fall within the third clause of Section 299, IPC. Thus, in our
opinion, the offence committed by the appellant was only "culpable homicide not
amounting to murder". Under these circumstances, we are inclined to bring down the
offence from first degree "murder" to "culpable homicide not amounting to murder",
punishable under the Second Part of Section 304, IPC.
17. Consequently, we partly allow the appeal; set aside the conviction of the appellant
under Section 302, IPC and instead convict him under Section 304, Part II, IPC. The
sentence of rigorous imprisonment for five years would meet the ends of justice.
Order accordingly.
AIR 2008 SUPREME COURT 784 "Chinnathaman v. State, Rep. by Inspector of Police"
(From : Madras)
Coram : 2 C. K. THAKKER AND J. M. PANCHAL, JJ.
Criminal Appeal No. 79 of 2006, D/- 13 -12 -2007.
Chinnathaman v. State, Rep. by Inspector of Police.
Penal Code (45 of 1860), S.300, Exception I and S.304, Part II - MURDER -
CULPABLE HOMICIDE - Murder - Sudden provocation - Homicide due to blow on
neck by sickle - Injuries not found sufficient in ordinary course of nature to cause death -
Deceased found guilty of offering grave and sudden provation to accused who delivered
blow after altercation by deceased - No premeditation or pre-plan on part of accused to
cause death - Conviction u/S. 300, held, liable to be set aside - Accused liable to be
convicted u/S. 304, Part II in view of Exception to S. 300.
Criminal Appeal No. 648 of 1997, D/- 28-3-2005, (Mad), Partly Reversed. (Para 10)

K. V. Viswanathan, Atul Kumar Sinha, Anup Kumar and Devendra Singh, for Appellants;
V. Kanakaraj, Sr. Advocate, S. Joseph Aristotle, S. Prabhu Ramasubramanium and V. G.
Pragasam, for Respondent.
Judgement
1. J. M. PANCHAL, J. :- This appeal is directed against the judgment dated 28th March,
2005 rendered by the High Court of Judicature at Madras in Criminal Appeal No. 648 of
1997, by which, judgment dated February 14, 1997 passed by learned First Additional
Sessions Judge, Coimbatore in Sessions Case No. 63 of 1996, convicting the appellant
under Section 302 of the Indian Penal Code (for short "the Code") and sentencing him to
R.I. for life, is confirmed.
2. The facts emerging from the record of the case are as under :
The appellant is a resident of village Thirumalainaickenpalayam. The name of his
younger brother is Dorai @ Nataraj, who was also residing in the same village at the
relevant time. The elder daughter of Nataraj was going to Pioneer Mill School for studies.
She had an affair with one Kirshnamurthy, who was a teacher in the
@page-SC785
school. Therefore, Mr. Dorai vacated his house situated in village and shifted his family
to a house located in the garden. He also stopped Punitha from attending the school.
Punitha, however, eloped with her teacher and, therefore, a missing report was lodged by
Dorai @ Nataraj with Periyanaickenpalayam Police Station. The appellant came to know
that his uncle's grandson Maruthachalam and his sister's son Chandran had facilitated
elopement of Punitha with her teacher and, therefore, scolded both of them. The incident
in question took place on April 27, 1994. On the date of incident at about 10.00 a.m. the
appellant was repairing the leakage in the pipe fitted near the well situated in his field.
Maruthachalam with his brother Senthil Kumar approached the appellant and asked him
to give bitterguard. The appellant refused to give bitterguard saying that they had
defamed his family by helping Punitha to elope with her teacher. Thereupon a verbal
altercation took place. The appellant picked up aruval (sickle) lying on the ground and
caused injuries on the neck of Maruthachalam. Thereupon Senthil Kumar raised shouts as
a result of which Thiru Ramasamy, the father of Maruthachalam, who was working in his
field rushed at the place of incident. The appellant after causing injuries to
Maruthachalam left his field and went to Village Administrative Officer with the sickle.
The Village Administrative Officer recorded the statement of the appellant and took him
to Periyanaickenpalayam Police Station with sickle. At the said police station, Thiru
Jayabalan was discharging duties as Sub-Inspector. On the basis of the statement made by
the appellant before the Village Administrative Officer, the Sub-Inspector registered an
offence punishable under Section 302 of the Code against the appellant and commenced
investigation. The police officer went to the place of incident and seized incriminating
articles under a panchnama. The dead body of the deceased was sent to the hospital for
autopsy. The police officer also recorded the statements of those persons who were found
to be conversant with the facts of the case. The incriminating articles seized were sent to
forensic science laboratory for analysis. On completion of investigation the appellant was
charge-sheeted for commission of offence punishable under Section 302, IPC in the court
of learned Judicial Magistrate Court No.VI, Coimbatore. As the offence punishable under
Section 302, IPC is exclusively triable by Court of Session, the case was committed to
the court of learned Additional Sessions Judge, Coimbatore for trial.
3. The learned Sessions Judge framed charge against the appellant for commission of
offence punishable under Section 302, IPC. It was read over and explained to him. He
pleaded not guilty to the same and claimed to be tried. The prosecution, therefore,
examined 12 witnesses to prove its case against the appellant and also produced
necessary documentary evidence.
4. After recording of the evidence of prosecution witnesses was over, the learned Judge
explained to the appellant the circumstances appearing against him in the evidence of the
prosecution and recorded his statement under Section 313 of the Code of Criminal
Procedure. In his further statement, the case of the appellant was that of total denial. He
did not examine any witness in his defence.
5. On appreciation of evidence adduced by the prosecution the learned Judge held that it
was proved that the deceased had died a homicidal death. After placing reliance on the
testimony of eye-witnesses the learned Judge concluded that the appellant was the author
of injuries sustained by the deceased. The learned Judge thereafter considered the nature
of the offence committed by the appellant. After taking into consideration the facts of the
case and the provisions of Section 300, IPC, the learned Judge concluded that the
appellant had committed an offence punishable under Section 302, IPC. Therefore, he
convicted the appellant under Section 302, IPC and imposed sentence of R.I. for life vide
judgment dated February 14, 1997. Feeling aggrieved, the appellant preferred an appeal
before the High Court of Judicature at Madras. The Division Bench of the High Court has
dismissed the appeal by its Judgment dated March 28, 2005 giving rise to the instant
appeal by special leave.
6. This Court has heard the learned counsel for the parties and considered the evidence on
record.
7. The fact that the deceased died a homicidal death is not in dispute before this Court.
The medical officer who had performed autopsy on the dead body of the deceased has
mentioned in detail the injuries noticed by him, in his substantive evidence
@page-SC786
before the court. Eye-witness Senthil Kumar has stated in his testimony that the appellant
had caused injuries on the neck of the deceased by means of a sickle. The autopsy report
also mentions in detail the injuries sustained by the deceased. It is nobody's case that the
injuries found on the dead body of the deceased were self- inflicted. Therefore, the fact
that the deceased died a homicidal death stands proved beyond pale of doubt.
8. The testimony of eye-witness Senthil Kumar would indicate that on the day of the
incident the deceased in his company had gone to the field of the appellant and had
demanded bitterguard. According to the said witness because of the elopement of Punitha
with her teacher, the appellant was annoyed and had, therefore, refused to give
bitterguard saying that they had defamed his family. What is stated by the said witness is
that the deceased had thereupon asked the appellant to talk in a decent manner and had
hardly turned his back to leave the field of the appellant when the appellant had delivered
a blow with sickle on the neck of the deceased. Though this witness was cross-examined
at length nothing substantial could be brought on record which would cast a doubt on his
assertion that the appellant was the author of the injuries sustained by the deceased.
Similarly, another witness Thiru Ramasami has also deposed that on the day of incident
he had seen the deceased going towards the field of the appellant in the company of
Senthil Kumar and had asked the deceased as to where he was going. According to this
witness thereupon the deceased had informed the witness that he was going to the field of
the appellant to get bitterguard. What is asserted by the witness is that he had advised the
deceased not to go to the field of the appellant as the appellant was nurturing a feeling
that they had helped Punitha to elope with her teacher. The witness has further stated that
the deceased had stated that they would come back if the appellant was not inclined to
give bitterguard. The witness has also stated that he had heard altercation taking place
between the appellant and the deceased but was not able to follow the same as he was at a
little distance. What is claimed by the witness is that he had seen the appellant delivering
blow to the deceased and that he had gone to the field of the appellant to help his injured
son who was bleeding profusely. The witness has mentioned that the people who were in
the nearby fields, had gathered and thereafter he had gone to the police station where he
had learnt that the appellant had already lodged a complaint against himself.
9. This witness is also cross-examined in detail, but nothing could be brought on record
to impeach his credibility. This witness stands fully corroborated in material particulars
by the testimony of witness Senthil Kumar. This Court finds that the Sessions Court and
High Court were justified in holding that the appellant was the author of the injuries
sustained by the deceased.
10. This brings the court to consider the question as to which offence is committed by the
appellant. Admittedly, the incident had taken place in the field/garden belonging to the
appellant, where he was engaged in his farming activities. From the evidence led by the
prosecution it is evident that the deceased, in the company of witness Senthil Kumar had
gone to the field of the appellant to get bitterguard though they were warned not to do so
by the father of the deceased. In spite of knowing that the appellant was nurturing a
feeling that the deceased and his own sister's son had facilitated elopement of Punitha
with her teacher, the deceased in the company of Senthil Kumar had gone to the field of
the appellant on the pretext of getting bitterguard. The testimony of the father of the
deceased establishes that his deceased son, in the company of witness Senthil Kumar had
stayed in the field of the appellant for about 15 minutes and that there was an altercation
between the appellant and the deceased. The appellant never knew and anticipated that
the deceased would enter his field nor had prepared himself in advance to attack the
deceased. Thus there was no premeditation or pre-plan on the part of the appellant, to
cause the death of the deceased. Though the appellant is senior in age to the deceased, the
deceased had advised the appellant to behave nicely without rhyme or reason, when the
appellant had refused to part with bitterguard saying that the deceased and others had
disgraced his family by facilitating elopement of Punitha with her teacher. It is not the
case of the prosecution that on seeing that the deceased was entering his field in the
company of Senthil Kumar, the appellant had straightway
@page-SC787
attacked him. The evidence led by the prosecution clearly establishes that after verbal
duel, which had lasted for pretty long time, the appellant had picked up a sickle which is
an agricultural implement, lying on the ground and delivered a blow on the neck of the
deceased. By entering the field of the appellant on the pretext of getting bitterguard,
though he was knowing fully well that the appellant was nurturing a feeling that he had
played a role in the elopement of Punitha with her teacher as well as engaging himself in
an altercation with the appellant, and advising the appellant to behave the deceased had
offered grave and sudden provocation to the appellant as a result of which the appellant,
in the heat of the moment had delivered a blow with sickle to the deceased. The Medical
Officer who had performed autopsy on the dead body of the deceased has not stated that
the injuries sustained by the deceased were sufficient in the ordinary course of nature to
cause his death. It is not the case of the prosecution that the appellant had acted cruelly, in
the sense that he had delivered successive blows to the deceased. There was sufficient
time and opportunity to the appellant to give repeated blows. It is not the case of the
prosecution that the appellant wanted to deliver other blows and that he was prevented
from doing so, by any person. So, there is reasonable ground to believe that after giving
the blow, the appellant had stopped and not acted cruelly. As noticed earlier, the appellant
was doing his work and was not waiting for the deceased to come. On the facts and in the
circumstances of the case, this Court is of the opinion that Exception 1 to Section 300,
IPC would apply to the facts of the case and the offence committed by the appellant
would be one punishable under Section 304, IPC. There is nothing on record to indicate
that the appellant had committed culpable homicide amounting to murder by causing
death of the deceased with the intention of causing death of the deceased or of causing
such bodily injury as was likely to cause his death. Therefore, the provisions of Part II of
Sction 304, IPC would apply to the facts of the case on hand. Thus, the appeal will have
to be allowed by converting the conviction of the appellant under Section 302, IPC to one
punishable under Section 304 Part II, IPC. This Court has considered the submissions
advanced at the bar for the purpose of imposition of sentence on the appellant for
commission of offence punishable under Section 304, Part II, IPC. As held earlier there
was no pre-meditation or pre-plan on the part of the appellant to cause death of the
deceased, and the occurrence had taken place when the deceased, with another had
entered the field of the appellant and engaged himself in an altercation with the appellant
when the appellant had refused to part with bitterguard. Having regard to the attending
circumstances in which the incident had taken place, this Court is of the opinion that the
interest of justice would be served if the appellant is sentenced to rigorous imprisonment
for five years for commission of offence punishable under Section 304, Part II, IPC.
11. For the foregoing reasons, the appeal partly succeeds. The judgment of the High
Court of Judicature at Madras dated March 28, 2005 rendered in Criminal Appeal No.
648 of 1997, confirming the conviction of the appellant under Section 302, IPC and
sentence of life imprisonment recorded by the learned First Additional Sessions Judge,
Coimbatore vide judgment dated February 14, 1997, delivered in Sessions Case No. 63 of
1996, is set aside. Instead the appellant is convicted for commission of an offence
punishable under Section 304, Part II, IPC for the said offence. The appellant is sentenced
to undergo rigorous imprisonment for five years and a fine of Rs. 5,000/-, in default,
simple imprisonment for one year. The appeal accordingly stands disposed of.
Appeal partly allowed.
AIR 2008 SUPREME COURT 787 "Sanapareddy Maheedhar Seshagiri v. State of
Andhra Pradesh"
(From : 2007 (1) Andh LD (Cri) 526)
Coram : 2 S. B. SINHA AND G. S. SINGHVI, JJ.
Criminal Appeal No. 1708 of 2007 (arising out of SLP (Cri.) No. 6680 of 2006), D/- 13
-12 -2007.
Sanapareddy Maheedhar Seshagiri and Anr. v. State of A.P. and Anr.
(A) Criminal P.C. (2 of 1974), S.482 - INHERENT POWERS - HIGH COURT -
Quashing of proceedings - Exercise of powers by High Court - When permissible.
The High Court should be extremely cautious and slow to interfere with the investigation
and/or trial of criminal cases and should not stall the investigation and/or prosecution
except when it is convinced
@page-SC788
beyond any manner of doubt that the FIR does not disclose commission of any offence or
that the allegations contained in the FIR do not constitute any cognizable offence or that
the prosecution is barred by law or the High Court is convinced that it is necessary to
interfere to prevent abuse of the process of the Court. In dealing with such cases, the
High Court has to bear in mind that judicial intervention at the threshold of the legal
process initiated against a person accused of committing offence is highly detrimental to
the larger public and societal interest. The people and the society have a legitimate
expectation that those committing offences either against an individual or the society are
expeditiously brought to trial and, if found guilty, adquately punished. Therefore, while
deciding a petition filed for quashing the FIR or complaint or restraining the competent
authority from investigating the allegations contained in the FIR or complaint or for
stalling the trial of the case, the High Court should be extremely careful and circumspect.
If the allegations contained in the FIR or complaint discloses commission of some crime,
then the High Court must keep its hands off and allow the investigating agency to
complete the investigation without any fetter and also refrain from passing order which
may impede the trial. The High Court should not go into the merits and demerits of the
allegations simply because the petitioner alleges malus animus against the author of the
FIR or the complainant. The High Court must also refrain from making imaginary
journey in the realm of possible harassment which may be caused to the petitioner on
account of investigation of the FIR or complaint. Such a course will result in miscarriage
of justice and would encourage those accused of committing crimes to repeat the same.
However, if the High Court is satisfied that the complaint does not disclose commission
of any offence or prosecution is barred by limitation or that the proceedings of criminal
case would result in failure of justice, then it may exercise inherent power under S. 482,
Cr. P. C.
(Para 30)
(B) Criminal P.C. (2 of 1974), S.482 - INHERENT POWERS - CRUELTY BY
HUSBAND OR HIS RELATIVE - BREACH OF TRUST - DOWRY - Abuse of process
of Court - Proceedings against husband under S. 498A, 406, IPC and Ss. 4, 6, Dowry
Prohibition Act, 1961 - Continuation of, at belated stage - Found to be amounting to
harassment to husband - Also amounting to abuse of process of Court - Held, liable to be
quashed.
In the instant case after marriage the respondent-wife lived with appellant-husband for
less than one and a half months (eight days in India and about thirty days in Foreign
Country). The proceedings under Ss. 498A, 406 of IPC and Ss. 4, 6 of Dowry Prohibition
Act were initiated by respondent against appellant and his parents in year 2000. The High
Court quashed the said proceedings qua the parents of the appellant on the ground that
the Magistrate could not have taken cognizance after three years. Respondent is not
shown to have challenged the said order. Therefore, that order will be deemed to have
become final. Therefore, at this belated stage, there could be no justification for
continuation of the said proceedings against the husband. Rather, it would amount to
sheer harassment to the appellant and the respondent who are settled in USA, if they are
required to come to India for giving evidence in relation to an offence allegedly
committed in 1998-99. It is also extremely doubtful whether the Govt. of India will, after
lapse of such a long time, give sanction in terms of S. 188, Cr. P. C. Therefore, in the
peculiar facts the continuation of said proceedings against the husband would amount to
abuse of the process of the Court and thus liable to be set aside.
(Paras 33, 34)
Cases Referred : Chronological Paras
2005 AIR SCW 1319 : AIR 2005 SC 1989 : 2005 Cri LJ 1732 (Ref.) 22
2004 AIR SCW 6185 : AIR 2005 SC 9 : 2005 Cri LJ 92 : 2005 AIR-Jhar HCR 19 (Ref.)
12, 27
2003 AIR SCW 4062 : AIR 2003 SC 3635 : 2003 Cri LJ 3888 : 2003 AIR-Jhar HCR 1181
(Ref.) 12, 29
1999 AIR SCW 1793 : AIR 1999 SC 2071 : 1999 Cri LJ 3479 (Ref.) 19, 21, 22
1999 AIR SCW 4413 : AIR 2000 SC 297 : 2000 Cri LJ 485 (Ref.) 20
1993 AIR SCW 1866 : AIR 1993 SC 1637 : 1993 Cri LJ 2516 (Ref.) 14
1993 AIR SCW 3595 (Ref.) 17
1992 AIR SCW 237 : AIR 1992 SC 604 : 1992 Cri LJ 527 (Ref.) 26, 27
AIR 1982 SC 949 : 1982 Cri LJ 819 (Ref.) 26
AIR 1981 SC 1054 : 1981 Cri LJ 722 (Ref.) 16, 17
AIR 1980 SC 326 : 1980 Cri LJ 98 (Ref.) 26
@page-SC789

AIR 1960 SC 866 : 19660 Cri LJ 1239 (Ref.) 24, 26


Ms. Bina Madhavan and S. Udaya Kumar Sagar (for M/s. Lawyer's Knit and Co.), for
Appellants; I. V. Narayana, Sr. Advocate, T. N. Rao, Ms. Manjeet Kirpal, Paramjeet Singh
and L. D. Rajendar, for Respondents.
Judgement
G. S. SINGHVI, J. :- Leave granted.
2. This appeal is directed against the order dated 6.12.2006 passed by the learned Single
Judge of the Andhra Pradesh High Court whereby he dismissed the petition filed by the
appellants under Section 482 of the Criminal Procedure Code (for short Cr.P.C.) for
quashing the proceedings of CC No.240/2002 pending in the Court of XXII Metropolitan
Magistrate, Hyderabad in relation to offences under Sections 498A and 406, Indian Penal
Code read with Sections 4 and 6 of the Dowry Prohibition Act, 1961 (for short "the
Dowry Act").
3. Bhavani Shireesha, the eldest daughter of respondent No. 2 Shrimati D. Shaila, is a
doctor by profession. She was married to appellant No. 1 Sanapareddy Maheedhar
Seshagiri who is working as Software Engineer at New Jersey, USA on 22.04.1998 at
Hyderabad. Before marriage, the appellants and their parents demanded Rs. 5 lakh cash,
50 tola gold jewellery and Rs. 75,000/- towards Adapaduchu Katnam as dowry. They also
demanded transfer of the ground floor of the residential house belonging to respondent
No. 2 and her husband in favour of the parents of the appellants. Respondent No. 2 and
her husband agreed to pay Rs. 4 lakh cash, 60 tola gold jewellary and Rs. 75,000/-
towards Adapaduchu Katnam as dowry. They also agreed to bequeath the ground portion
of their house in the name of their daughter. The appellants and their parents accepted the
proposal and performed betrothal on 16.04.1998. Thereafter, the parents of the appellants
demanded Zen car and threatened to cancel the engagement unless the car is given. This
compelled the husband of respondent no. 2 to raise loan of Rs. 4 lakh and purchased the
car, which is said to have been kept at the disposal of the parents of the appellants. After
marriage, the appellants left for USA, but Shireesha Bhavani stayed back at Hyderabad
with their parents because she was undergoing training as House Surgeon. After
completing the training, Shireesha Bhavani went to USA along with the parents of the
appellants. She stayed at New Jersey from 1.11.1998 to 2.12.1998. During this period,
Shireesha Bhavani was subjected to cruelty and harassment by the appellants and their
parents on the ground that she did not bring enough dowry. On 3.12.1998 she went to
Maryland (U.S.A.) and stayed with her relatives. In April 1999, the parents of the
appellants returned to India. On 5.4.1999, appellant No.1 instituted divorce petition in
Superior Court at New Jersey and an ex parte decree was passed in his favour on
15.12.1999.
4. In the meanwhile, Shireesha Bhavani wrote letter dated 13.04.1999 to her parents
complaining of cruelty by the appellants and their parents. She disclosed that while she
was staying with the parents of the appellants at Hyderabad, the mother-in-law always
complained of lack of dowry and abused and criticized her and asked her to do menial
job. She further disclosed that appellant No. 1 and his brother harassed and also
pressurized her to bring additional money for purchase of a house at Hyderabad in the
name of the in-laws. She gave detailed account of the alleged harassment and torture
meted out by the appellants and their parents. Thereupon, respondent No. 2 filed
complaint dated 26.8.1999 in the Court of XXII Metropolitan Magistrate, Hyderabad
(hereinafter referred to as "the concerned Magistrate") detailing therein the facts relating
to demand of dowry by the appellants and their parents and the incidents of cruelty and
harassment to which her daughter was subjected at Hyderabad and New Jersey.
Respondent No. 2 also alleged that immediately after marriage, the appellants and their
parents complained about lack of dowry by saying that appellant No. 1 could have been
married for a dowry of Rs. 35 lakhs. Another allegation made by respondent No. 2 was
that her daughter was driven out of the house with an indication that she will be allowed
to return only after the demands of the accused-appellants and their parents are met. The
learned Magistrate referred the complaint for investigation under Section 156(3), Cr.P.C.
This led to registration of Crime No. 54/1999 at Women Police Station, CID, Hyderabad.
On 18.9.2000 the Inspector of Police, Women Protection Cell, C.I.D., Hyderabad
submitted final report with the prayer that the case may be treated as closed due to lack of
evidence. He mentioned that much progress could not be made due to non-availability of
de facto
@page-SC790
victim and other key witnesses in India and there was no immediate prospect of their
coming to India. He also mentioned that the accused party returned the personal
belongings including gold jewellery to the de facto victim in U.S.A. and that a decree of
divorce had been passed by the Superior Court of New Jersey, Chancery Division, Family
Part, Middlesex County. The Investigating Officer also made a reference to the direction
given by Additional Director General of Police, CID to close the case due to lack of
evidence.
5. By an order dated 1.11.2000, the concerned Magistrate rejected the final report and
directed the police to make further investigation. In the opinion of the learned Magistrate,
the investigation had not been done properly and the final report submitted under the
dictates of the Additional Director General of Police was not acceptable. While doing so,
the learned Magistrate made a reference to the letter addressed by Director General of
Police, CID, Andhra Pradesh to the Regional Passport Office, Hyderabad wherein it was
mentioned that Shrimati Bhavani Shireesha had been subjected to cruelty and a request
was made to cancel or impound the passport of the appellants.
6. In compliance of the direction given by the learned Magistrate the police conducted
further investigation and recorded statements of 18 persons. Notice was also issued to
Shrimati Shireesha Bhavani to appear before CID Police, Hyderabad. At that stage,
respondent No. 2 filed Criminal Petition No. 3912 of 2000 under Section 482, Cr.P.C. for
quashing the notice issued by the Inspector of Police, CID, Hyderabad for appearance of
her daughter in connection with the Crime No. 54 of 1999. The same was disposed of by
the learned Single Judge on 22.9.2000 with liberty to the petitioner to approach the
investigating agency and inform it about the efforts being made by her daughter to come
to India or to approach the concerned court for non-acceptance of final report, if any,
submitted by the police. Respondent No. 2 also filed Writ Petition No. 1173 of 2001 for
issue of a mandamus to the Regional Passport Officer, Secunderabad to impound the
passport of appellant no. 1 herein. That petition was disposed of by the learned Single
Judge on 26.9.2000 with a direction to the Regional Passport Officer to take appropriate
decision on the complaint made by respondent No. 2.
7. It is borne out from the record that on an application made by respondent No. - 2 the
concerned Magistrate issued warrant for search of the premises of the parents of the
appellants for recovery of the dowry articles and passport of her daughter. In the course
of search conducted by Sri P.Ventaka Rami Reddy, Inspector of Police (Women
Protection Cell) CID, Hyderabad on 19.7.2000 the parents of the appellants disclosed that
the passport has been sent to Shrimati B. Shireesha by Ordinary Post some time in
January/February, 1999, but they could not produce any evidence to substantiate the
same.
8. After disposal of Criminal Petition No. 3912 of 2000, Bhavani Shireesha obtained
duplicate passport and visa and came to India on 26.7.2002. She appeared before the
Investigating Officer on 27.7.2002 and gave statement under Section 161, Cr.P.C.
Thereafter, the police filed a charge-sheet under Sections 498A and 406, IPC read with
Sections 3, 4 and 6 of the Dowry Act. On 4.10.2002 the concerned Magistrate took
cognizance of the case and issued summons to the appellants and their parents.
9. It is also borne out from the record that without disclosing the fact that the concerned
Magistrate had already rejected the final report, the appellants and their parents filed Writ
Petition Nos. 6237 of 2001 and 2284 of 2001 with the prayer for quashing the
proceedings of Crime No. 54 of 1999 on the file of Women Protection Cell, CID,
Hyderabad. The learned Single Judge who heard the writ petitions made a reference to
order dated 26.9.2000 passed by another learned Single Judge in Criminal Petition No.
3912 of 2000 and disposed of both the petitions on 4.12.2001 by directing XXII
Metropolitan Magistrate, Hyderabad to pass appropriate order on the final report within a
period of two months of receipt of the copy of the order.
10. The parents of the appellants challenged the proceedings of CC No. 240 of 2002 in
Criminal Petition No. 1302 of 2003 filed under Section 482, Cr.P.C. They pleaded that in
view of the bar contained in Section 468, Cr.P.C. the concerned Magistrate did not have
the jurisdiction to take cognizance of the offences under Sections 498A and 406, IPC read
with Sections 3 and 4 of the Dowry Act. By an order dated 24.10.2006 the learned Single
Judge accepted their plea and quashed the proceedings of CC No. 240 of 2002. While
doing so,
@page-SC791
the learned Single Judge also expressed doubt regarding Bhavani Shireesha having come
to India for the purpose of making statement before the police.
11. Encouraged by the success of litigious venture undertaken by their parents, the
appellants filed Criminal Petition No. 4152 of 2006 for quashing the proceedings in CC
No. 240 of 2002. They pleaded that after the expiry of three years counted from the date
of filing the complaint, the learned Magistrate could not have taken cognizance of the
offences allegedly committed by them under Sections 498A and 406 read with Sections 4
and 6 of the Dowry Act. Another plea taken by them was that in the face of the decree of
divorce passed by the Superior Court at New Jersey, USA and the fact that Shrimati
Shireesha Bhavani had contracted marriage with one Mr. Venkat Puskar in the year 2000,
there was no warrants for initiation of criminal proceedings against them, and that the
offences allegedly committed by them outside India cannot be enquired into or tried
without obtaining prior sanction of the Central Government in terms of Section 188,
Cr.P.C.
12

. The learned Single Judge briefly referred to the parameters for exercise of power by the
High Court under Section 482, Cr.P.C., the ingredients of Sections 498A and 406, IPC
and Sections 3 and 4 of the Dowry Act and held that the proceedings in CC No. 240/2002
cannot be quashed because the learned Magistrate had taken cognizance within three
years. The learned Single Judge distinguished the judgments of this Court in M/s. Zandu
Pharmaceutical Works Ltd. v. Mohd. Sharaful Haque [2005 (1) SCC 122] and Ramesh
Chandra Sinha and Ors. v. State of Bihar and Ors. [2003 (7) SCC 254] by observing that
in those cases the Magistrate had taken cognizance long after three years. He then
observed that each act of cruelty could be a new starting point of limitation and,
therefore, the cognizance taken by the Magistrate cannot be treated as barred by time. As
regards the ex parte decree of divorce passed by the Court at New Jersey, the learned
Single Judge observed that the foreign judgment is not conclusive and that various facts
are required to be proved and established before the Criminal Court. The learned Single
Judge rejected the appellant's plea regarding lack of sanction of the Central Government
by observing that such sanction can be obtained even during the trial. 2004 AIR
SCW 6185
2003 AIR SCW 4062

13. Ms. Beena Madhavan, learned counsel for the appellants reiterated the contentions
raised on behalf of her clients before the High Court and argued that the learned Single
Judge committed an error by refusing to quash the proceedings of CC No.240 of 2002
ignoring the fact that the learned Magistrate had taken cognizance after almost four years
of the last act of alleged cruelty committed against Shireesha Bhavani. She submitted that
after dissolution of the marriage, Shrimati Shireesha Bhavani had taken back the Gold
and Silver jewellery and then contracted marriage with Mr. Venkat Puskar and this fact
ought to have been considered by the learned Single Judge while examining the
appellant's pleas that the proceedings of criminal case instituted against them amounts to
an abuse of the process of law. She then argued that in exercise of the power under
Section 482, Cr.P.C., the High Court is duty-bound to quash the proceedings which are
barred by time and protect the appellants against unwarranted persecution.
14
. Shri I.Venkata Narayana, learned Senior Advocate appearing for respondent No.2,
supported the order under challenge and argued that the learned Single Judge of the High
Court rightly declined to quash the proceedings of criminal case because the offences
committed by the appellants are continuing in nature. Shri Venkata Narayana further
argued that even though as on the date of taking cognizance of offences by the learned
Magistrate, a period of more than three years had elapsed, the proceedings of CC No.
240/2002 cannot be declared as barred by limitation because the appellants were not in
India and the period of their absence is liable to be excluded in terms of Section 470(4).
Shri Venkata Narayana relied on Section 472 and argued that offences of cruelty and
criminal breach of trust are continuing offences and prosecution launched against the
appellants cannot be treated as barred by time. He then submitted that the learned
Magistrate could also exercise power under Section 473 for extending the period of
limitation because the appellants and their parents did not co-operate in the investigation
and also prevented Smt. Shireesha Bhavani from coming to India to give her statement.
Lastly, the learned Senior Counsel relied on the 1993 AIR SCW 1866

@page-SC792
judgment of this Court in Ajay Agarwal v.Union of India [1993 (3) SCC 609] and argued
that the proceedings of the criminal case cannot be quashed only on the ground of lack of
sanction under Section 188, Cr.P.C.
15. We have considered the respective submissions and carefully scrutinised the record.
For deciding whether the learned Magistrate could take cognizance of offence under
Sections 498A and 406, IPC read with Sections 4 and 6 of the Dowry Act after expiry of
three years, it will be useful to notice the scheme of Chapter XXXVI of the Code of
Criminal Procedure. Section 468 which finds place in that Chapter creates a bar against
taking cognizance of an offence after lapse of the period of limitation. Sub-section (1)
thereof lays down that except as otherwise provided elsewhere in this Code, no Court,
shall take cognizance of an offence of the category specified in sub-section (2), after the
expiry of the period of limitation. Sub-section (2) specifies different periods of limitation
for different types of offences punishable with imprisonment for a term exceeding one
year but not exceeding three years, the period of limitation is three years. Section 469
specifies the point of time with reference to which the period of limitation is to be
counted. Section 470 provides for exclusion of time in certain cases. Sub-section (4)
thereof lays down that in computing the period of limitation, the time during which the
offender has been absent from India or from any territory outside India which is under the
administration of the Central Government or has avoided arrest by absconding or
concealing himself, shall be excluded. Section 472, which deals with continuing offence
declares that in case of a continuing offence, a fresh period of limitation shall begin to run
at every moment of the time during which the offence continues. Section 473, which
begins with non-obstante clause, empowers the Court to take cognizance of an offence
after the expiry of the period of limitation, if it is satisfied that the delay has been
properly explained and it is necessary so to do in the interest of justice.
16

. In State of Punjab v. Sarwan Singh [1981 (3) SCC 34], this Court noted that the object
of Section 468 Cr.P.C. is to create a bar against belated prosecutions and to prevent abuse
of the process of the court and observed that this is in consonance with the concept of
fairness of trial enshrined in Article 21 of the Constitution. AIR 1981 SC 1054

17

. In Venka Radhamanohari v. Vanka Venkata Reddy [1993 (3) SCC 4] this Court
considered the applicability of Section 468 to the cases involving matrimonial offences,
referred to the judgment in Sarwan Singhs case (supra) and observed : 1993 AIR
SCW 3593

"It is true that the object of introducing Section 468 was to put a bar of limitation on
prosecutions and to prevent the parties from filing cases after a long time, as it was
thought proper that after a long lapse of time, launching of prosecution may be vexatious,
because by that time even the evidence may disappear. This aspect has been mentioned in
the statement and object, for introducing a period of limitation, as well as by this Court in
the case of Sarwan Singh (supra). But, that consideration cannot be extended to
matrimonial offences, where the allegations are of cruelty, torture and assault by the
husband or other members of the family to the complainant. It is a matter of common
experience that victim is subjected to such cruelty repeatedly and it is more or less like a
continuing offence. It is only as a last resort that a wife openly comes before a court to
unfold and relate the day-to-day torture and cruelty faced by her, inside the house, which
many of such victims do not like to be made public. As such, courts while considering the
question of limitation for an offence under Section 498-A i.e. subjecting a woman to
cruelty by her husband or the relative of her husband, should judge that question, in the
light of Section 473 of the Code, which requires the Court, not only to examine as to
whether the delay has been properly explained, but as to whether it is necessary to do so
in the interests of justice.
[Emphasis added]
18. The court then compared Section 473, Cr.P.C. with Section 5 of the Limitation Act
and observed :
"For exercise of power under Section 5 of the Limitation Act, the onus is on the appellant
or the applicant to satisfy the court that there was sufficient cause for condonation of the
delay, whereas Section 473 enjoins a duty on the court to examine not only whether such
delay has been explained but as to whether it is the requirement of the justice to condone
or ignore such delay.
@page-SC793
As such, whenever the bar of Section 468 is applicable, the court has to apply its mind on
the question, whether it is necessary to condone such delay in the interests of justice.
While examining the question as to whether it is necessary to condone the delay in the
interest of justice, the Court has to take note of the nature of offence, the class to which
the victim belongs, including the background of the victim. If the power under Section
473 of the Code is to be exercised in the interests of justice, then while considering the
grievance by a lady, of torture, cruelty and inhuman treatment, by the husband and the
relatives of the husband, the interest of justice requires a deeper examination of such
grievances, instead of applying the rule of limitation and saying that with lapse of time
the cause of action itself has come to an end. The general rule of limitation is based on
the Latin maxim : v igilantibus, et non, dormientibus, jura subveniunt (the vigilant, and
not the sleepy, are assisted by the laws). That maxim cannot be applied in connection
with offences relating to cruelty against women. "
[Emphasis added]
19

. In Arun Vyas v. Anita Vyas [1999 (4) SCC 690 : 1999 SCC (Cri) 629] this Court again
considered the applicability of Section 473, Cr.P.C. in cases relating to matrimonial
offences and observed : 1999 AIR SCW 1793, Para 14

"The first limb confers power on every competent court to take cognizance of an offence
after the period of limitation if it is satisfied on the facts and in the circumstances of the
case that the delay has been properly explained and the second limb empowers such a
Court to take cognizance of an offence if it is satisfied on the facts and in the
circumstances of the case that it is necessary so to do in the interests of justice. It is true
that the expression in the interest of justice in Section 473 cannot be interpreted to mean
in the interest of prosecution. What the court has to see is interest of justice. The interest
of justice demands that the court should protect the oppressed and punish the
oppressor/offender. In complaints under Section 498-A the wife will invariably be
oppressed, having been subjected to cruelty by the husband and the in-laws. It is,
therefore, appropriate for the courts, in case of delayed complaints, to construe liberally
Section 473, Cr.P.C. in favour of a wife who is subjected to cruelty if on the facts and in
the circumstances of the case it is necessary so to do in the interests of justice. When the
conduct of the accused is such that applying the rule of limitation will give an unfair
advantage to him or result in miscarriage of justice, the court may take cognizance of an
offence after the expiry of the period of limitation in the interests of justice. This is only
illustrative, not exhaustive."
20

. In State of H.P. v. Tara Dutt [2000 (1) SCC 230] a three Judges Bench of this Court
considered whether there can be a presumption of condonation of delay under Section
473 Cr.P.C. and observed : 1999 AIR SCW 4413, (Para 7)

"Section 473 confers power on the Court taking cognizance after the expiry of the period
of limitation, if it is satisfied on the facts and in the circumstances of the case that the
delay has been properly explained and that it is necessary so to do in the interest of
justice. Obviously, therefore in respect of the offences for which a period of limitation
has been provided in Section 468, the power has been conferred on the court taking
cognizance to extend the said period of limitation where a proper and satisfactory
explanation of the delay is available and where the Court taking cognizance finds that it
would be in the interest of justice. This discretion conferred on the Court has to be
exercised judicially and on well-recognised principles. This being a discretion conferred
on the court taking cognizance, wherever the court exercises this discretion, the same
must be by a speaking order, indicating the satisfaction of the court that the delay was
satisfactorily explained and condonation of the same was in the interest of justice. In the
absence of a positive order to that effect it may not be permissible for a superior court to
come to the conclusion that the court must be deemed to have taken cognizance by
condoning the delay whenever the cognizance was barred and yet the court took
cognizance and proceeded with the trial of the offence. But the provisions are of no
application to the case in hand since for the offences charged, no period of limitation has
been provided in view of the imposable punishment thereunder. In this view of the matter
we have no hesitation to come to the conclusion that the High Court committed serious
error in holding that the conviction of the two respondents under Section 417 would be
barred as on the date of taking
@page-SC794
cognizance the Court could not have taken cognizance of the said offence. Needless to
mention, it is well settled by a catena of decisions of this Court that if an accused is
charged with a major offence but is not found guilty thereunder, he can be convicted of a
minor offence if the facts established indicate that such minor offence has been
committed."
21

. This Court then considered the earlier judgment in Arun Vyas v. Anita Vyas (supra) and
held : 1999 AIR SCW 1793

"The aforesaid observations made by this Court indicate that the order of the Magistrate
at the time of taking cognizance in case of an offence under Section - 498?A, should
indicate as to why the Magistrate does not think it sufficient in the interest of justice to
condone the delay inasmuch as an accused committing an offence under Section 498-A
should not be lightly let off. We have already indicated in the earlier part of this judgment
as to the true import and construction of Section 473 of the Code of Criminal Procedure.
The said provision being an enabling provision, whenever a Magistrate invokes the said
provision and condones the delay, the order of the Magistrate must indicate that he was
satisfied on the facts and circumstances of the case that the delay has been properly
explained and that it is necessary in the interest of justice to condone the delay. But
without such an order being there or in the absence of such positive order, it cannot (sic)
be said that the Magistrate has failed to exercise jurisdiction vested in law. It is no doubt
true that in view of the fact that an offence under Section 498-A is an offence against the
society and, therefore, in the matter of taking cognizance of the said offence, the
Magistrate must liberally construe the question of limitation but all the same the
Magistrate has to be satisfied, in case of period of limitation for taking cognizance under
Section 468(2)(c) having expired that the circumstances of the case require delay to be
condoned and further the same must be manifest in the order of the Magistrate itself. This
in our view is the correct interpretation of Section 473 of the Code of Criminal
Procedure.
22

. In Ramesh v. State of Tamil Nadu [2005 (3) SCC 507] this Court considered the issue of
limitation in taking cognizance of an offence under Section 498A and observed : 2005
AIR SCW 1319
1999 AIR SCW 1793
"On the point of limitation, we are of the view that the prosecution cannot be nullified at
the very threshold on the ground that the prescribed period of limitation had expired.
According to the learned counsel for the appellants, the alleged acts of cruelty giving rise
to the offence under Section 498-A ceased on the exit of the informant from the
matrimonial home on 2-10-1997 and no further acts of cruelty continued thereafter. The
outer limit of time for taking cognizance would therefore be 3-10-2000, it is contended.
However, at this juncture, we may clarify that there is an allegation in the FIR that on 13-
10-1998/14-10-1998, when the informants close relations met her in-laws at a hotel in
Chennai, they made it clear that she will not be allowed to live with her husband in
Mumbai unless she brought the demanded money and jewellery. Even going by this
statement, the taking of cognizance on 13-2-2002 pursuant to the charge-sheet filed on
28-12-2001 would be beyond the period of limitation. The commencement of limitation
could be taken as 2-10-1997 or at the most 14-10-1998. As pointed out by this Court in
Arun Vyas v. Anita Vyas (supra) the last act of cruelty would be the starting point of
limitation. The three-year period as per Section 468(2)(c) would expire by 14-10-2001
even if the latter date is taken into account. But that is not the end of the matter. We have
to still consider whether the benefit of extended period of limitation could be given to the
informant. True, the learned Magistrate should have paused to consider the question of
limitation before taking cognizance and he should have addressed himself to the question
whether there were grounds to extend the period of limitation. On account of failure to do
so, we would have, in the normal course, quashed the order of the Magistrate taking
cognizance and directed him to consider the question of applicability of Section 473.
However, having regard to the facts and circumstances of the case, we are not inclined to
exercise our jurisdiction under Article 136 of the Constitution to remit the matter to the
trial court for taking a decision on this aspect. The fact remains that the complaint was
lodged on 23-6-1999, that is to say, much before the expiry of the period of limitation and
the FIR was registered by the All-Women Police Station, Tiruchirapalli on that day. A
copy of the FIR was sent to the Magistrate's Court on the next day i.e. on 24-6-1999.
However, the process of investigation and
@page-SC795
filing of charge-sheet took its own time. The process of taking cognizance was
consequentially delayed. There is also the further fact that the appellants filed Writ
Petition (Crl.) No. 1719 of 2000 in the Bombay High Court for quashing the FIR or in the
alternative to direct its transfer to Mumbai. We are told that the High Court granted an ex
parte interim stay. On 20-8-2001, the writ petition was permitted to be withdrawn with
liberty to file a fresh petition. The charge-sheet was filed four months thereafter. It is in
this background that the delay has to be viewed."
23. The ratio of the above noted judgments is that while considering the applicability of
Section 468 to the complaints made by the victims of matrimonial offences, the Court can
invoke Section 473 and can take cognizance of an offence after expiry of the period of
limitation keeping in view the nature of allegations, the time taken by the police in
investigation and the fact that the offence of cruelty is a continuing offence and affects
the society at large. To put it differently, in cases involving matrimonial offences the
Court should not adopt a narrow and pedantic approach and should, in the interest of
justice, liberally exercise power under Section 473 for extending the period of limitation.
24. At this stage, we may also notice the parameters laid down by this Court for exercise
of power by the High Court under Section 482 Cr.P.C to give effect to any order made
under the Cr.P.C or to prevent abuse of the process of any court or otherwise to secure the
ends of justice. In R. P. Kapur v. State of Punjab [AIR 1960 SC 866] this Court
considered the question whether in exercise of its power under Section 561A of the Code
of Criminal Procedure, 1898 (Section 482 Cr.P.C. is pari materia to Section 561A of the
1898 Code), the High Court could quash criminal case registered against the appellant
who along with his mother-in-law was accused of committing offences under Sections
420, 109, 114 and 120B of the Indian Penal Code. The appellant unsuccessfully filed a
petition in the Punjab High Court for quashing the investigation of the First Information
Report (FIR) registered against him and then filed appeal before this Court. While
confirming the High Courts order this Court laid down the following proposition :-
"The inherent power of High Court under Section 561A, Criminal P.C. cannot be
exercised in regard to matters specifically covered by the other provisions of the Code.
The inherent jurisdiction of the High Court can be exercised to quash proceedings in a
proper case either to prevent the abuse of the process of any court or otherwise to secure
the ends of justice. Ordinarily criminal proceedings instituted against an accused person
must be tried under the provisions of the Code, and the High Court would be reluctant to
interfere with the said proceedings at an interlocutory stage. It is not possible, desirable or
expedient to lay down any inflexible rule which would govern the exercise of this
inherent jurisdiction."
25. This Court then carved out some exceptions to the above stated rule. These are :
(i) Where it manifestly appears that there is a legal bar against the institution or
continuance of the criminal proceedings in respect of the offences alleged. Absence of the
requisite sanction may, for instance, furnish cases under this category;
(ii) Where the allegations in the First Information Report or the complaint, even if they
are taken at their face value and accepted in their entirety, do not constitute the offence
alleged; in such cases no question of appreciating evidence arises; it is a matter merely of
looking at the complaint or the First Information Report to decide whether the offence
alleged is disclosed or not;
(iii) Where the allegations made against the accused person do constitute an offence
alleged but there is either no legal evidence adduced in support of the case or the
evidence adduced clearly or manifestly fails to prove the charge. In dealing with this class
of cases it is important to bear in mind the distinction between a case where there is no
legal evidence or where there is evidence which is manifestly and clearly inconsistent
with the accusation made and cases where there is legal evidence which on its
appreciation may or may not support the accusation in question. In exercising its
jurisdiction under Section 561-A the High Court would not embark upon an enquiry as to
whether the evidence in question is reliable or not. That is the function of the trial
magistrate, and ordinarily it would not be open to any party to invoke the High Courts
inherent jurisdiction and contend that on a reasonable appreciation of the evidence the
@page-SC796
accusation made against the accused would not be sustained.
26
. In State of Haryana v Bhajanlal [1992 Supp. (1) SCC 335] this Court considered the
scope of the High Courts power under Section 482 of Cr.P.C and Article 226 of the
Constitution to quash the FIR registered against the respondent, referred to several
judicial precedents including those of R. P. Kapoor v. State of Punjab (supra), State of
Bihar v. J.A.C. Saldanha [1980 (1) SCC 554] and State of West Bengal v. Swapan Kumar
Guha [1982 (1) SCC 561] and held that the High Court should not embark upon an
enquiry into the merits and demerits of the allegations and quash the proceedings without
allowing the investigating agency to complete its task. At the same time, the Court
identified the following cases in which the FIR or complaint can be quashed. 1992
AIR SCW 237
AIR 1960 SC 866
AIR 1980 SC 326
AIR 1982 SC 949

"(1) Where the allegations made in the first information report or the complaint, even if
they are taken at their face value and accepted in their entirety do not prima facie
constitute any offence or make out a case against the accused.
(2) Where the allegations in the first information report and other materials, if any,
accompanying the FIR do not disclose a cognizable offence, justifying an investigation
by police officers under Section 156(1) of the Code except under an order of a Magistrate
within the purview of Section 155(2) of the Code.
(3) Where the uncontroverted allegations made in the FIR or complaint and the evidence
collected in support of the same do not disclose the commission of any offence and make
out a case against the accused.
(4) Where the allegations in the FIR do not constitute a cognizable offence but constitute
only a non-cognizable offence, no investigation is permitted by a police officer without
an order of a Magistrate as contemplated under Section 155(2) of the Code.

(5) Where the allegations made in the FIR or complaint are so absurd and inherently
improbable on the basis of which no prudent person can ever reach a just conclusion that
there is sufficient ground for proceeding against the accused.
(6) Where there is an express legal bar engrafted in any of the provisions of the Code or
the Act concerned (under which a criminal proceeding is instituted) to the institution and
continuance of the proceedings and/or where there is a specific provision in the Code or
the Act concerned, providing efficacious redress for the grievance of the aggrieved party.
(7) Where a criminal proceeding is manifestly attended with mala fide and/or where the
proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on
the accused and with a view to spite him due to private and personal grudge."
27

. The ratio of Bhajan Lal's case has been consistently followed in the subsequent
judgments. In M/s. Zandu Pharmaceutical Works Ltd. v. Mohd. Sharaful Haque (supra),
this Court referred to a large number of precedents on the subject and observed - : 1992
AIR SCW 237
2004 AIR SCW 6185
"The powers possessed by the High Court under Section 482 of the Code are very wide
and the very plenitude of the power requires great caution in its exercise. Court must be
careful to see that its decision in exercise of this power is based on sound principles. The
inherent power should not be exercised to stifle a legitimate prosecution. The High Court
being the highest court of a State should normally refrain from giving a prima facie
decision in a case where the entire facts are incomplete and hazy, more so when the
evidence has not been collected and produced before the court and the issues involved,
whether factual or legal, are of magnitude and cannot be seen in their true perspective
without sufficient material. Of course, no hard-and-fast rule can be laid down in regard to
cases in which the High Court will exercise its extraordinary jurisdiction of quashing the
proceeding at any stage. It would not be proper for the High Court to analyse the case of
the complainant in the light of all probabilities in order to determine whether a conviction
would be sustainable and on such premises arrive at a conclusion that the proceedings are
to be quashed. It would be erroneous to assess the material before it and conclude that the
complaint cannot be proceeded with. In a proceeding instituted on complaint, exercise of
the inherent powers to quash the proceedings is called for only in a case where the
complaint does not disclose any offence or is frivolous, vexatious or oppressive. If the
allegations set out in the complaint do not
@page-SC797
constitute the offence of which cognizance has been taken by the Magistrate, it is open to
the High Court to quash the same in exercise of the inherent powers under Section 482 of
the Code. It is not, however, necessary that there should be meticulous analysis of the
case before the trial to find out whether the case would end in conviction or acquittal. The
complaint has to be read as a whole. If it appears that on consideration of the allegations
in the light of the statement made on oath of the complainant that the ingredients of the
offence or offences are disclosed and there is no material to show that the complaint is
mala fide, frivolous or vexatious, in that even there would be no justification for
interference by the High Court. When an information is lodged at the police station and
an offence is registered, then the mala fides of the informant would be of secondary
importance. It is the material collected during the investigation and evidence led in court
which decides the fate of the accused person. The allegations of mala fides against the
informant are of no consequence and cannot by themselves be the basis for quashing the
proceedings."
28. In the aforementioned judgment, this Court set aside the order of the Patna High
Court and quashed the summons issued by the First Class Judicial Magistrate in
Complaint Case No.1613(C) of 2002 on the ground that the same was barred by
limitation prescribed under Section 468 (2)(C) Cr.P.C.
29

. In Ramesh Chand Sinha's case (supra) this Court quashed the decision of the Chief
Judicial Magistrate, Patna to take cognizance of the offence allegedly committed by the
appellants by observing that the same was barred by time and there were no valid
grounds to extend the period of limitation by invoking Section 473, Cr.P.C. 2003
AIR SCW 4062
30. A careful reading of the above noted judgments makes it clear that the High Court
should be extremely cautious and slow to interfere with the investigation and/or trial of
criminal cases and should not stall the investigation and/or prosecution except when it is
convinced beyond any manner of doubt that the FIR does not disclose commission of any
offence or that the allegations contained in the FIR do not constitute any cognizable
offence or that the prosecution is barred by law or the High Court is convinced that it is
necessary to interfere to prevent abuse of the process of the court. In dealing with such
cases, the High Court has to bear in mind that judicial intervention at the threshold of the
legal process initiated against a person accused of committing offence is highly
detrimental to the larger public and societal interest. The people and the society have a
legitimate expectation that those committing offences either against an individual or the
society are expeditiously brought to trial and, if found guilty, adequately punished.
Therefore, while deciding a petition filed for quashing the FIR or complaint or restraining
the competent authority from investigating the allegations contained in the FIR or
complaint or for stalling the trial of the case, the High Court should be extremely careful
and circumspect. If the allegations contained in the FIR or complaint discloses
commission of some crime, then the High Court must keep its hands off and allow the
investigating agency to complete the investigation without any fetter and also refrain
from passing order which may impede the trial. The High Court should not go into the
merits and demerits of the allegations simply because the petitioner alleges malus animus
against the author of the FIR or the complainant. The High Court must also refrain from
making imaginary journey in the realm of possible harassment which may be caused to
the petitioner on account of investigation of the FIR or complaint. Such a course will
result in miscarriage of justice and would encourage those accused of committing crimes
to repeat the same. However, if the High Court is satisfied that the complaint does not
disclose commission of any offence or prosecution is barred by limitation or that the
proceedings of criminal case would result in failure of justice, then it may exercise
inherent power under Section 482, Cr.P.C.
31. In the light of the above, we shall now consider whether the High Court committed an
error by refusing to quash the proceedings of CC No.240 of 2002.
32. Although, the learned Single Judge of High Court dealt with various points raised by
the appellants and negatived the same by recording the detailed order, his attention does
not appear to have been drawn to the order dated 24.10.2006 passed by the co-ordinate
bench in Criminal Petition No.1302/2003 whereby the proceedings of CC No.240/2002
were quashed qua the parents of the appellants on the ground that
@page-SC798
the learned Magistrate could not have taken cognizance after three years. Respondent
No.2 is not shown to have challenged the order passed in Criminal Petition
No.1302/2003. Therefore, that order will be deemed to have become final. We are sure
that if attention of the learned Single Judge, who decided Criminal Petition No.4152/2006
had been drawn to the order passed by another learned Single Judge in Criminal Petition
No.1302/2003, he may have, by taking note of the fact that the learned Magistrate did not
pass an order for condonation of delay or extension of the period of limitation in terms of
Section 473 Cr.P.C., quashed the proceedings of CC No.240/2002.
33. We are further of the view that in the peculiar facts of this case, continuation of
proceedings of CC No.240/2002 will amount to abuse of the process of the Court. It is
not in dispute that after marriage, Shireesha Bhavani lived with appellant No.1 for less
than one and a half months (eight days at Hyderabad and about thirty days at New
Jersey). It is also not in dispute that their marriage was dissolved by the Superior Court at
New Jersey vide decree dated 15.12.1999. Shireesha Bhavani is not shown to have
challenged the decree of divorce. As a matter of fact, she married Sri Venkat Puskar in
2000 and has two children from the second marriage. She also received all the articles of
dowry (including jewellery) by filing affidavit dated 28.12.1999 in the Superior Court at
New Jersey. As on today a period of almost nine years has elapsed of the marriage of
appellant No.1 and Shireesha Bhavani and seven years from her second marriage.
Therefore, at this belated stage, there does not appear to be any justification for
continuation of the proceedings in CC No.240/2002. Rather, it would amount to sheer
harassment to the appellant and Shireesha Bhavani who are settled in USA, if they are
required to come to India for giving evidence in relation to an offence allegedly
committed in 1998-99. It is also extremely doubtful whether the Government of India
will, after lapse of such a long time, give sanction in terms of Section 188, Cr.P.C.
34. For the reasons stated above, the appeal is allowed, the order of the learned Single
Judge of the High Court is set aside and the proceedings of CC No.240/2002, pending in
the Court of XXII Metropolitan Magistrate, Hyderabad, are quashed.
Appeal allowed.
AIR 2008 SUPREME COURT 798 "K.S.E.B., M/s. v. Commr. of Central Excise,
Thiruvananthapuram"
(From : 2006 (4) Ker LT 749)
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Civil Appeal No. 5832 of 2007 (arising out of SLP (C) No. 3724 of 2007), D/- 12 -12
-2007.
M/s. Kerala State Electricity Board v. Commr. of Central Excise, Thiruvananthapuram.
Finance Act (32 of 1994), S.65, S.69, S.75 - Service Tax Rules (1994), R.6 -
FINANCIAL PROVISIONS - SERVICE TAX - Liability to pay tax - Appellants entering
into agreement with foreign company for obtaining consultancy services for them -
Service provider did not have any independent office in India - Appellants, service
recipient, held, liable to pay service tax and interest on amount of tax due to such service
provider. (Para 21)
Cases Referred : Chronological Paras
2005 AIR SCW 613 : AIR 2005 SC 1103 : 2005 All LJ 559 19
2005 AIR SCW 2051 : AIR 2005 SC 3020 : 2006 Tax LR 75 (Ref.) 19
(2005)13 SCC 245 (Disting) 20
1999 AIR SCW 2771 : AIR 1999 SC 2596 : 1999 Tax LR 828 (Ref.) 19
AIR 1989 SC 516 19
AIR 1981 SC 774 : 1981 Tax LR 28919
AIR 1981 SC 1480 19
AIR 1975 SC 1758 19
AIR 1963 SC 1667 19
AIR 1962 SC 1281 (Ref.) 19
T. L. V. Iyer, Sr. Advocate, M. T. George, for Appellant; R. G. Padia, Sr. Advocate, Navin
Prakash, B. Krishna Prasad, for Respondent.
Judgement
S. B. SINHA, J. :- Leave granted.
A limited notice was issued to the effect as to whether the appellant Kerala State
Electricity Board, the service recipient, within the meaning of provisions of Finance Act,
1994, levying service tax, is liable to pay any interest on the amount of tax due to the
respondent.
2. The question involved in this appeal arises out of a judgment and order dated
25.7.2006 passed by a Division Bench of the High Court of Kerala at Ernakulam whereby
the appeal filed by the respondent herein from the judgment and order of the Customs
Excise and Service Tax Appellate Tribunal, Circuit Bench at Cochin in Final Order
No.477 of 2005, Appeal No.ST/36/2004 was allowed.
@page-SC799
3. The basic fact of the matter is not in dispute. Appellant herein entered into an
agreement with M/s. SNC Lavlin Inc. Montreal, Canada (Foreign company) in relation to
various projects for obtaining consultancy services from them.
The relevant clauses of the said agreement are as under :-
"16.1 - SNC Lavaline and all its expatriate personnel shall be responsible for timely and
prompt filing of all returns, estimates, accounts, information and details complete and
accurate in all respects as may be required under the applicable laws/regulations in India
before the appropriate authorities in India. In case SNC Lavaline or any of its expatriate
personnel do not comply with the above tax requirements, which results in any penalty,
interest or additional liability, the same shall be borne by SNC Lavaline.
16.2 - SNC Lavaline shall provide KSE Board the relevant orders/notices of demand,
invoices, appellate orders and other relevant information as the proof of the actual tax
liability to be borne by KSE Board, sufficiently in advance to enable KSEB to take
appropriate action in this connection.
16.3 - SNC Lavaline and its expatriate personnel, if required by KSEB, shall contest
appeals against any assessment/demand of an appropriate authority before such authority
at the request of and cost expenses of KSEB."
4. Despite the said contractual commitments, the appellant failed and/or neglected to pay
service tax on behalf of foreign company. It, on the other hand, raised a dispute that
having regard to the purported statutory obligations of the service provider as contained
in the Act and the Rules framed, it was not liable to pay any service tax.
5. By reason of the impugned judgment, the Division Bench of the Kerala High Court
construing the provisions of the Act in the light of the terms of the contract entered into
by and between the appellant and the foreign company opined that the liability in that
regard was on the appellant and not on the foreign company.
6. Mr. T.L.V. Iyer, learned senior counsel, in support of this appeal, inter alia, urged that
the liability to pay interest and penalty being statutory one, the service provider was
responsible therefor and not the service recipient.
7. Mr. R.G. Padia, learned senior counsel appearing on behalf of the respondent, on the
other hand, would support the impugned judgment.
8. The period for which the service tax was due is August 1998 to September 2002.
Under the agreement, indisputably, the appellant was responsible to make payment of the
service tax on behalf of the foreign company.
9. Section 65 of the Finance Act, 1994 provides for levy of service tax on the services
specified therein. Section 66 of the Act provides that the rate of tax shall be twelve per
cent of the value of taxable services specified therein and collected in such manner as
may be prescribed. Section 68 of the Act puts the burden of payment of tax on the service
provider.
Sections 68(2), 69(1), 71 and relevant parts of Sections 73 and 75 of the Finance Act,
1994 which are material for the purposes of this case, read as under :
"68. (2) Notwithstanding anything contained in sub-section (1), in respect of any taxable
service notified by the Central Government in the Official Gazette, the service tax
thereon shall be paid by such person and in such manner as may be prescribed at the rate
specified in section 66 and all the provisions of this Chapter shall apply to such person as
if he is the person liable for paying the service tax in relation to such service.
69. Registration.- (1) Every person liable to pay the service tax under this Chapter or the
rules made thereunder shall, within such time and in such manner and in such form as
may be prescribed, make an application for registration to the Superintendent of Central
Excise.
71. Verification of tax assessed by the assessee, etc.-
(1) The Superintendent of Central Excise may, on the basis of information contained in
the return filed by the assessee under section 70, verify the correctness of the tax assessed
by the assessee on the services provided.
(2) The Superintendent of Central Excise may require the assessee to produce any
accounts, documents or other evidence as he may deem necessary for such verification as
and when required.
(3) If on verification under sub-section (2),
@page-SC800
the Superintendent of Central Excise is of the opinion that service tax on any service
provided has escaped assessment or has been under-assessed, he may refer the matter to
the Assistant Commissioner of Central Excise or, as the case may be, the Deputy
Commissioner of Central Excise, who may pass such order of assessment as he thinks fit.
73. Recovery of Service Tax Not Levied or Paid or Short levied or Short-paid or
Erroneously Refunded.
(1) Where any service tax has not been levied or paid or has been short-levied or short-
paid or erroneously refunded, the Central Excise Officer may, within one year from the
relevant date, serve notice on the person chargeable with the service tax which has not
been levied or paid or which has been short-levied or short-paid or the person to whom
such tax refund has erroneously been made, requiring him to show cause why he should
not pay the amount specified in the notice:
xxx xxx xxx
(1A) Where any service tax has not been levied or paid or has been short-levied or short-
paid or erroneously refunded, by reason of fraud, collusion or any wilful mis-statement or
suppression of facts, or contravention of any of the provisions of this Chapter or the rules
made thereunder, with intent to evade payment of service tax, by such person or his
agent, to whom a notice is served under the proviso to sub-section (1) by the Central
Excise Officer, such person or agent may pay service tax in full or in part as may be
accepted by him, and the interest payable thereon under section 75 and penalty equal to
twenty-five per cent. of the service tax specified in the notice or the service tax so
accepted by such person within thirty days of the receipt of the notice.;
75. Interest on delayed payment of service tax
Every person, liable to pay the tax in accordance with the provisions of section 68 or
rules made thereunder, who fails to credit the tax or any part thereof to the account of the
Central Government within the period prescribed, shall pay simple interest at such rate
not below ten per cent and not exceeding thirty-six per cent. per annum, as is for the time
being fixed by the Central Government, by notification in the Official Gazette, for the
period by which such crediting of the tax or any part thereof is delayed."
10. The Central Government in exercise of its power conferred upon it by sub-section (1)
of Section 69 of the Finance Act, 1994 made Service Tax Rules, 1994 for the purpose of
assessment and collection of service tax. Service tax was imposed on Consultancy
Engineering Services w.e.f. 07.07.1997 by a Notification No.23 of 1997 dated
02.07.1997. Consulting Engineer as defined in Section 65(31) of the Finance Act, 1994 is
a professionally qualified or any body corporate or any other firm but that directly or
indirectly render any advice, consultancy or technical assistance in any manner to a client
in one or more disciplines of engineering.
11. Clause (g) of sub-section (105) of Section 65 of the Finance Act, 1994, as amended,
provides for the definition of taxable services rendered by a consulting engineer to mean
any service provided to a client by consulting engineer in relation to advice, consultancy
or technical service in any manner to client in one or more disciplines of engineering.
12. Sub-rule (1) of Rule 6 of Service Tax Rules, as applicable at the relevant time,
stipulated that in case of a person who was from outside India and did not have any office
in India, the service tax due on the service rendered by him should be paid by such person
or on his behalf by any other person authorized by him should submit to the
Commissioner of Central Excise in whose jurisdiction the taxable services have been
rendered by him a return containing specific details with necessary enclosures. Such
returns along with a demand draft have to be submitted within a period of 30 days from
the date of raising the bill on the client for the taxable services rendered.
13. We may furthermore notice that in terms of the proviso appended to sub-rule - (1) of
Rule 6 of Service Tax Rules, it is provided that in case of a person who was a non-
resident or was from outside India and who did not have any office in India, the service
tax due on the service rendered by him should be paid by such person or on his behalf by
another person authorized by him who should submit to the Commissioner of Central
Excise in whose jurisdiction the taxable services had been rendered, a return containing
specific details with necessary enclosures.
@page-SC801
14. The High Court has arrived at a finding of fact that the foreign company did not have
any office in India. It is not in dispute that the terms of the agreement entered into by and
between the appellant and foreign company at all material time, show that the
responsibility of meeting the service tax liability was on the service recipient and despite
the amendment of Rule 6 (1) w.e.f. 16.8.2002 agreement still held good as the service
recipient being the appellant had taken up the responsibility of meeting the liability of the
foreign company.
15. Clause 16.1 of the contract obligated the foreign company responsible only for filing
of returns, estimates, accounts, information and details complete and accurate in all
respects as may be required by any law or regulation. Only in the event the foreign
company did not comply with the said requirements resulting in imposition of any
penalty, interest or additional liability, the same shall be borne by it. Clause 16.1 did not
cast any obligation upon the foreign company to make the payment of tax; the same is
being the liability of the appellant.
16. Submissions of Mr. Iyer that the payment of interest was the statutory liability of the
service provider must be considered in the aforementioned context. If Appellant itself
was liable for payment of tax, it was also liable for payment of statutory interest
thereupon, if the same had not been deposited within the time stipulated by the statute.
The liability to pay tax was not on the foreign company. Only on default on the part of
the appellant the interest was leviable. Appellant was clearly liable therefor. In other
words, the liability being that of the appellant, it must accept the liability of payment of
interest leviable thereupon in terms of statute occasioned by the breach on its part to
deposit the amount of tax within the prescribed time.
17. Proviso appended to Rule 6 which has been inserted w.e.f. 28.2.1999 cast a liability
upon a person authorized by the foreign company to do it in that behalf. The details were
to be furnished by a person who was authorized. Clause (2) of the proviso provides for
submission of the demand draft within 30 days from the date of raising the bill. Appellant
being the person authorized to make payment of the service tax, Section 75 would come
into operation in the event of its failure to do so.
18. We may further notice that it was the appellant who had provided space and
accommodation to the personnel of M/s SNC Lavalin in their office premises and borne
expenditure related thereto. The service provider did not have any independent office.
19

. We may at this juncture notice the decisions cited by Mr. Iyer. In Laghu Udyog Bharati
and Anr. v. Union of India and Ors. [(1999) 6 SCC 418] this Court held that keeping in
view the statutory scheme as they existed in the amended rules providing for payment of
tax on the service recipient was illegal. The said provision, however, were amended with
retrospective effect. Challenge of the constitutional validity of the said amendment, came
up for consideration in Gujarat Ambuja Cements Ltd. and Anr. v. Union of India and Anr.
[(2005) 4 SCC 214] wherein a Division Bench categorically held that the basis of
reconsideration of the decisions in Laghu Udyog Bharati's case was taken away stating :
1999 AIR SCW 2771
2005 AIR SCW 2051, (Paras 23 to 30, 36, 37 and 39)

"22. As we have said, Rules 2(1)(d)(xii) and (xvii) had been held to be illegal in Laghu
Udyog Bharati only because the charging provisions of the Act provided otherwise. Now
that the charging section itself has been amended so as to make the provisions of the Act
and the Rules compatible, the criticism of the earlier law upheld by this Court can no
longer be availed of. There is thus no question of the Finance Act, 2000 overruling the
decision of this Court in Laghu Udyog Bharati as the law itself has been changed. A
legislature is competent to remove infirmities retrospectively and make any imposition of
tax declared invalid, valid. This has been the uniform approach of this Court. Such
exercise in validation must of course also be legislatively competent and legally
sustainable. Those issues are considered separately. On the first question, we hold that the
law must be taken as having always been as is now brought about by the Finance Act,
2000. The statutory foundation for the decision in Laghu Udyog Bharati has been
replaced and the decision has thereby ceased to be relevant for the purposes of construing
the present provisions [vide Ujagar Prints (II) v. Union of India]. Therefore subject to our
decision on the question of the legislative competence of Parliament to enact the law, and
assuming the amendments in 2003 to be legal for 1999 AIR SCW 2771
AIR 1989 SC 516

@page-SC802
the time being, we reject the submission of the writ petitioners that by the amendments
brought about by Sections 116 and 117 of the Finance Act, 2000, the decision in Laghu
Udyog Bharati has been legislatively overruled.

23. The next question is whether the levy of service tax on carriage of goods by transport
operators was legislatively competent. Laghu Udyog Bharati did not consider the
question of legislative competency. Before we consider the scope of the impugned Act, it
is necessary to determine the scope of the two legislative entries namely Entry 97 of List
I and Entry 56 of List II. It has been recognised in Godfrey Phillips that there is a
complete and careful demarcation of taxes in the Constitution and there is no overlapping
as far as the fields of taxation are concerned. This mutual exclusivity which has been
reflected in Article 246(1) means that taxing entries must be construed so as to maintain
exclusivity. Although generally speaking, a liberal interpretation must be given to taxing
entries, this would not bring within its purview a tax on subject-matter which a fair
reading of the entry does not cover. If in substance, the statute is not referable to a field
given to the State, the court will not by any principle of interpretation allow a statute not
covered by it to intrude upon this field. 2005 AIR SCW 613

24. Undisputedly, Chapter V of the Finance Act, 1994 was enacted with reference to the
residuary power defined in Entry 97 of List I. But as has been held in International
Tourist Corpn. v. State of Haryana : (SCC pp. 325-26, para 6-A) AIR 1981 SC 774,
(Para 7)

"Before exclusive legislative competence can be claimed for Parliament by resort to the
residuary power, the legislative incompetence of the State Legislature must be clearly
established. Entry 97 itself is specific in that a matter can be brought under that entry
only if it is not enumerated in List II or List III and in the case of a tax if it is not
mentioned in either of those lists."
25. In that case Section 3(3) of the Punjab Passengers and Goods Taxation Act, 1952 was
challenged by transport operators. The Act provided for the levy of the tax on passengers
and goods plying in the State of Haryana. According to the transport operators, the State
could not levy tax on passengers and goods carried by vehicles plying entirely along the
national highways. According to them this was solely within the power of the Centre
under Entry 23 read with Entry 97 of List I. The submission was held to be patently
fallacious by this Court. It was held that Entry 56 of List II did not exclude national
highways so that the passengers and goods carried on national highways would fall
directly and squarely within Entry 56 of List II. It was said that the State played a role in
the maintenance of the national highway and there was sufficient nexus between the tax
and passengers and goods carried on the national highway to justify the imposition.
26. The writ petitioners in this case have, relying on this judgment, argued that the Act
falls squarely within Entry 56 of List II and therefore could not be referred to Entry 97 of
List I. We do not agree.

27. There is a distinction between the object of tax, the incidence of tax and the
machinery for the collection of the tax. The distinction is important but is apt to be
confused. Legislative competence is to be determined with reference to the object of the
levy and not with reference to its incidence or machinery. There is a further distinction
between the objects of taxation in our constitutional scheme. The object of tax may be an
article or substance such as a tax on land and buildings under Entry 49 of List II, or a tax
on animals and boats under Entry 58, List II or on a taxable event such as manufacture of
goods under Entry 84 of List I, import or export of goods under Entry 83 of List I, entry
of goods under Entry 52 of List II or sale of goods under Entry 54, List II to name a few.
Theoretically, of course, as we have held in Godfrey Phillips India Ltd. v. State of U.P.
ultimately even a tax on goods will be on the taxable event of ownership or possession.
We need not go into this question except to emphasise that, broadly speaking the subject-
matter of taxation under Entry 56 of List II are goods and passengers. The phrase carried
by roads or natural waterways carves out the kind of goods or passengers which or who
can be subjected to tax under the entry. The ambit and purport of the entry has been dealt
with in Rai Ramkrishna v. State of Bihar where it was said in language which we cannot
better (SCR p. 908) : 2005 AIR SCW 613
AIR 1963 SC 1667, (Para 9)

"Entry 56 of the Second List refers to taxes on goods and passengers carried by road or
AIR 1981 SC 1480

@page-SC803
on inland waterways. It is clear that the State Legislatures are authorised to levy taxes on
goods and passengers by this entry. It is not on all goods and passengers that taxes can be
imposed under this entry; it is on goods and passengers carried by road or on inland
waterways that taxes can be imposed. The expression carried by road or on inland
waterways is an adjectival clause qualifying goods and passengers, that is to say, it is
goods and passengers of the said description that have to be taxed under this entry.
Nevertheless, it is obvious that the goods as such cannot pay taxes, and so taxes levied on
goods have to be recovered from some persons, and these persons must have an intimate
or direct connection or nexus with the goods before they can be called upon to pay the
taxes in respect of the carried goods. Similarly, passengers who are carried are taxed
under the entry. But, usually, it would be inexpedient, if not impossible, to recover the tax
directly from the passengers and so, it would be expedient and convenient to provide for
the recovery of the said tax from the owners of the vehicles themselves." (See also Sainik
Motors v. State of Rajasthan)
34. The point at which the collection of the tax is to be made is a question of legislative
convenience and part of the machinery for realisation and recovery of the tax. The
manner of the collection has been described as an accident of administration; it is not of
the essence of the duty. It will not change and does not affect the essential nature of the
tax. Subject to the legislative competence of the taxing authority a duty can be imposed at
the stage which the authority finds to be convenient and the most effective, whatever
stage it may be. The Central Government is therefore legally competent to evolve a
suitable machinery for collection of the service tax subject to the maintenance of a
rational connection between the tax and the person on whom it is imposed. By Sections
116 and 117 of the Finance Act, 2000, the tax is sought to be levied on the recipients of
the services. They cannot claim that they are not connected with the service since the
service is rendered to them.

35. In a similar fact situation under an Ordinance the Central Government was authorised
to levy and collect a duty of excise on all coal and coke dispatched from collieries. Rules
framed under the Ordinance provided for collection of the excise duty by the railway
administration by means of a surcharge on freight recoverable either from the consignor
or the consignee. The imposition of excise duty on the consignee was challenged on the
ground that the consignee had nothing to do with the manufacture or production of the
coal. Negativing this submission this Court in R. C. Jall v. Union of India, AIR at p. 1286
said : AIR 1962 SC 1281

"The argument confuses the incidence of taxation with the machinery provided for the
collection thereof."
36. In Rai Ramkrishna the tax under Entry 56 of List II was held to be competently levied
on the bus operators or bus owners even though the object of levy was passengers (which
they were not) because there was a direct connection between the object of the tax viz.
goods and passengers and the owners of the transport carrying the goods or passengers.
There is thus nothing inherently illegal or unconstitutional to provide for service tax to be
paid by the availer or user.

37. The writ petitioners have relying upon the decision in Dwarka Prasad v. Dwarka Das
Saraf contended that the amendment to Section 68 by the introduction of a proviso in
2003, was invalid. It is submitted that as the body of the section did not cover the subject-
matter, there was no question of creating an exception in respect thereto by a proviso.
According to the writ petitioners, the proviso cannot expand the body by creating a
separate charge. It is submitted that by merely amending the definition of the word
assessee it could not be understood to mean that thereby all customers of the services in
question were liable. 1975 SC 1758

38. The submission is misconceived for several reasons. Section 68 is a machinery


section in that it provides for the incidence of taxation and is not the charging section
which is Section 66. The amendments to Section 66 brought about in 2000 changed the
point of collection of tax from the provider of the service to such manner as may be
prescribed. Section 68(1-A) as it stood in 1997 provided for the collection and recovery
of service tax in respect of the services referred in sub-clauses (g) to (r) of Section
65(41), which included both the services with which we are concerned, from such person
and in such manner as may be prescribed. The 1998 Finance Act maintained this. Now
the Service Tax Rules, 1994
@page-SC804
provided for the collection and recovery of tax from the users or payers for the services.
This was the prescribed method. All that the proviso to Section 68(1-A) did was to
prescribe the procedure for collection with reference to services of goods transport
operators and clearing agents which services had already been expressly included under
the Finance Act, 2000 in the definition of taxable service."
20. Reliance placed by Mr. Iyer on Commissioner of Central Excise, Meerut II v. L.H.
Sugar Factories Ltd. and Ors. [(2005) 13 SCC 245] is also not of much assistance as the
decision was rendered in relation to the provisions of Income-tax Act holding that the
said Act also must be construed having regard to the charging provision.
21. We, therefore, are of the opinion that no case has been made out for interference with
the impugned judgment.
22. The appeal is dismissed with costs. Counsel's fee assessed at Rs.25,000/- (Rupees
twenty five thousand only).
Appeal dismissed.
AIR 2008 SUPREME COURT 804 "Ajay Mohan v. H. N. Rai"
(From : Bombay)
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Civil Appeal No. 5831 of 2007 (arising out of SLP (C) No. 13789 of 2007), D/- 12 -12
-2007
Ajay Mohan and Ors. v. H. N. Rai and Ors.
(A) Civil P.C. (5 of 1908), O.23, R.1 - WITHDRAWAL OF SUIT - APPEAL -
Withdrawal of appeal - Grant of permission - Court becomes functus officio thereafter -
Cannot grant further relief.
In the instant case, the order of the City Civil Court may be bad but then it was required
to be set aside by the Court of Appeal. An appeal had been preferred by the appellants
thereagainst but the same had been withdrawn. The said order of City Civil Court,
therefore, attained finality. The High Court, while allowing the appellant to withdraw the
appeal, no doubt, passed an order of status quo for a period of two weeks in terms of its
order but no reason therefor had been assigned. It ex facie had no jurisdiction to pass
such an interim order. Once the appeal was permitted to be withdrawn, the Court became
functus officio. It did not hear the parties on merit. It had not assigned any reason in
support thereof. Ordinarily, a Court, while allowing a party to withdraw an appeal, could
not have granted a further relief.
(2005) 11 SCC 509, Followed.
(Para 17)
(B) Civil P.C. (5 of 1908), O.39, R.1 - INJUNCTION - SUPREME COURT -
AMENDMENT - PLAINT - Application for injunction - Maintainability - Suit for
permanent injunction against dispossession - Application for interim injunction filed
therein - Order rejecting it - Becoming final on withdrawal of appeal against it - No
liberty granted to plaintiffs to file a fresh application for injunction - In subsequent
proceedings Supreme Court while permitting amendment of plaint directing defendants
not to create third party rights till disposal of chamber summons - Disposal of chamber
summons - Subsequent application for injunction - Rejection of - No infirmity - Only
because further prayer had been made in suit upon amending plaint, the same by itself did
not bring about situational change warranting application of mind afresh by Court.(Paras
19, 20, 21)
Cases Referred : Chronological Paras
(2007) SLP (C) No. 1218 of 2007, D/- 2-2-2007 (SC) (Ref.)11
2005 AIR SCW 270 : AIR 2005 SC 626 (Ref.) 15
2005 AIR SCW 3578 : AIR 2005 SC 3165 (Ref.) 15
(2005) 11 SCC 509 (Foll.) 17
2002 AIR SCW 5315 : AIR 2003 SC 649 (Ref.) 15
AIR 1964 SC 993 (Ref.) 15
AIR 1960 SC 941 (Ref.) 15
R. F. Nariman and Shyam Dewan, Sr. Advocates; Parimal Shroff, Mahesh Agarwal, Rishi
Agrawala, E. C. Agrawala, Gaurav Goel and Surya Kant Jadhav, for Appellants; Ashok
Desai and Mukul Rohtagi, Sr. Advocates, P. H. Parekh, Pradip Sancheti, Sameer Parekh,
Ajay K. Jha, Ms. N. Don, Parthiv Goswami, Kush Chaturvedi and Ms. Diksha Raj (for P.
H. Parekh and Co.), for Respondents.
Judgement
S. B. SINHA, J. :- Leave granted.
2. Appellants are aggrieved by and dissatisfied with the judgment and order dated
16.6.2007 passed in Appeal From Order No.320 of 2007 by a Division Bench of the
Bombay High Court whereby and whereunder an appeal from an order dated 12.4.2007
passed by City Civil Court, Bombay in
@page-SC805
Notice of Motion No.944 of 2007 rejecting an application for injunction filed by them
was dismissed.
3. Appellants are said to have become owners of the suit land by reason of a deed of gift,
which is said to have been executed by Mrs. Tara Sarup on 30.3.1968 in favour of the
first appellant. Indisputably, Respondents claim their right, title, interest and possession
on or over the land in suit in terms of an agreement of sale purported to have been
executed by the appellants herein in their favour on or about 23.10.1969.
4. Appellants' case in relation to the said agreement for sale are :
(a) It is a forged document.
(b) In any event, the plaintiff No.1 being minor on the date of execution of the agreement
(his date of birth being 8.3.1952), the same is void in law.
5. The claim of the respondents, on the other hand, is that out of the amount of
consideration mentioned in the said agreement, namely Rs.90,000/-, a sum of Rs.80,000/-
has already been paid and they were put in possession thereover in part performance
thereof, as envisaged under Section 53A of Transfer of Property Act.
6. Various proceedings appear to have initiated before the Revenue Courts in regard to
inclusion of the name of the respondents in the Revenue Records. It is further accepted
that the first appellant herein had executed three deeds of assignment in favour of the
second appellant herein on or about 29.6.1991.
A suit was filed by the appellants before the City Civil Court, Bombay which was marked
as Suit No. 4962 of 2006 claiming, inter alia, for a decree for permanent injunction
restraining the respondents from creating any right in or over the suit land on the basis of
revenue entries as also for a decree for permanent injunction restraining them from
interfering with their possession and occupation thereupon.
In the said suit, the appellants took out a notice of motion marked as Notice of Motion
No. 3551 of 2006 and by order dated 13.10.2006, learned Judge, City Civil Court,
Bombay refused to grant an order of injunction, inter alia, holding :
(i) The contentions advanced by the defendants are of much substance inasmuch as in
view of the execution of the agreement for sale, the onus was upon the plaintiffs to get
the said documents cancelled and treated as null and void. Such a prayer having not been
made, mere relief for injunction prayed for by the plaintiffs cannot give rise to existence
of prima facie case for grant of relief at the interlocutory stage.
(ii) The cardinal rule being that possession follows title, the plaintiff proceeded under the
assumption that he had assigned the suit property to plaintiff No.2 who is a builder and
developer and that plaintiff No.2 and plaintiff No.3 are said to be protecting the property.
(iii) The alleged threat of dispossession given by the defendants to the plaintiffs being
towards the end of May 2006, no details thereabout had been stated in the plaint and in
that view of the matter also the plaintiffs had failed to make out a prima facie case.
(iv) After a report was prepared by the Revenue Officer, allegedly the defendants were
found to be in possession. As the plaintiffs had not challenged the agreement of sale dated
23.10.1969 whereunder only the defendants had been claiming their right, validity thereof
or otherwise would be pre-judging the case at that stage.
It was also found that the plaintiffs had not approached the court with clean hands.
7. Appellants thereafter filed an application for amendment of plaint. They also preferred
an appeal against the said order dated 13.10.2006 in the High Court of Judicature at
Bombay. The said appeal, however, was withdrawn stating that they would move the trial
court for amendment of the plaint. While allowing the said prayer, an observation was
made that the trial court shall consider the question in regard to the amendment of plaint
without in any way being influenced by the observations made by the learned trial Judge
in the impugned order. Although, the High Court allowed the appellants to withdraw the
appeal, it directed the parties to maintain status quo for a period of two weeks.
8. A chamber summons thereafter was taken by the appellants on or about 1.12.2006
wherein not only amendment of the plaint was prayed for but an interim order of
injunction during the pendency of the said application was also prayed for. We may
notice the amendments sought for by the appellants in the said Notice of Motion :
"(a)(i) That it may be declared that the
@page-SC806
Defendants or any of them have no right, title or interest of any nature in respect of the
plots of land bearing at C.T.S. Nos.6A and 7/1A of village Powai, Taluka Kurla
admeasuring about 37,673 sq. mtrs. and C.T.S. Nos. 20 and 22 of village Tirandaz, Taluka
Kurla admeasuring about 27,582 sq. mtrs. or any part/s thereof by virtue of the alleged
Agreement for Sale dated 23rd October, 1969, being Exhibit "A10" hereto or otherwise
or at all;
(a)(ii) that the Defendants, their servants and agents may be permanently restrained by
an Order and injunction of this Hon'ble Court from claiming any right, title or interest of
any nature in respect of the plots of land bearing at C.T.S. Nos.A and 7/1A of village
Powai, Taluka Kurla admeasuring about 37,673 sq. mtrs. and C.T.S. Nos. 20 and 22 of
village Tirandaz, Taluka Kurla admeasuring about 27,582 sq. mtrs. or any part/s thereof
by virtue of the said alleged Agreement for Sale dated 23rd October, 1969 being Exhibit
"A-10" hereto or otherwise or at all.
11. Add in the prayer (a) in the Plaint after the words 'pass an order of injunction' add
"permanently".
12. Add in prayer (a) after the words 'Taluka: Kurla bearing ..' delete the words "CTS
No.22 (Approx.) admeasuring 18,083 sq. mts.' And instead add the following - :
"CTS Nos.20 and 22 admeasuring 27,582 sq. mts. and at village Powai Taluka Kurla
bearing CTS Nos. 6A and 7-1A admeasuring 37,673 sq. mts. And".
13. Add in the prayer (b) in the Plaint after the words 'pass an order of injunction' add
"permanently".
14. (i) Add in prayer (b) after the words 'Taluka : Kurla bearing ............' delete the words
"CTS No.22 (Approx.) admeasuring 18,083 sq. mts.' And instead add the following :
"CTS Nos. 20 and 22 admeasuring 27,582 sq. mts and at village Powai Taluka Kurla
bearing CTS Nos.6A and 7-1A admeasuring 37,673 sq. mts. And".
(ii) Add in the Fourth line of prayer (b) after the words land occupation of the plaintiffs'
the words "Nos.2 and 3".
15. In prayer clause (c) after the words prayer clauses add '(a)(i)'."
9. Prayer for interim relief was rejected by the learned judge, City Civil Court opining
that the earlier order dated 13.10.2006 became final.
10. Against the said order, the appellants again approached the High Court and by an
order dated 10.1.2007, a learned Single Judge noticing that the proposed amendment fell
short of relief of declaration that the suit agreement was null and void and to be set aside,
came to the conclusion - :
"This indicates that the Appellants were conscious that such relief will have to be pressed
in respect of the suit documents. Obviously, that perception is on account of the fact that
the said documents were made subject-matter of proceedings before the Revenue
Authorities indeed, the Respondents have stated on affidavit that the Original copy of the
said document has been lost in respect of which police complaint is already instituted. In
such a case, however, it is possible for the Respondents to establish the fact of existence
of such Agreement by relying on secondary evidence on fulfilling the required norms in
that behalf. Be that as it may, prima facie, it is seen from the record that the execution of
the suit documents has been disputed by the Appellants as back as in 1984, which stand
has been dealt with by the Authorities. Suffice it to observe that the Appellants would
succeed only if they were to challenge the subject Agreement, inasmuch as the
Defendants were asserting rights in respect of the suit land on the basis of the said
Agreement. The fact that the Original copy of the said Agreement is not in existence does
not alter the situation so as to absolve the Appellants from claiming relief that the said
Agreement is null and void and to set it aside."
On the said findings, the judgment and order of the City Civil Court was upheld.
11. A Special Leave Application was filed before this Court against the said order which
was marked as SLP (C) No.1218 of 2007. The same was disposed of by an order dated
2.2.2007, stating :
"Counsel for the respondent-defendants, on instructions, states that the defendants have
no intention to create third party rights till the disposal of the amendment application
filed by the petitioners before the concerned City Civil Court, which is coming up before
the said Court for disposal on 7th February, 2007. We direct the concerned Court to
dispose of the Chamber Summons on 7th February, 2007 and till then, as stated on
@page-SC807
behalf of the counsel for the respondents-defendants, no third party interest shall be
created. The Chamber Summons shall be decided uninfluenced by any observations made
by the High Court in the impugned order.
Counsel for the Petitioners submits that the prayers made in the Chamber Summons are
for amendment of the plaint as well as for interim reliefs.
The Court will consider all the reliefs prayed for in the Chamber Summons and pass
appropriate orders.
The Special Leave Petition is disposed of accordingly."
12. By an order dated 28.2.2007, the application for amendment was allowed. Keeping in
view the fact that the plaintiffs' prayer for grant of interim injunction was confined in the
earlier notice of motion till the disposal thereof, the plaintiff did not press for the second
prayer expressing his desire to take out a separate notice of motion.
A notice of motion for grant of injunction was again taken out which was dismissed by
reason of an order dated 12.3.2007 by the learned Judge, City Civil Court. In regard to
the order of this Court dated 2.2.2007, the learned Judge observed :
"I have read and re-read the order of the Supreme Court. The Apex Court has said that
this Court will consider all the reliefs prayed for in the Chamber Summons and pass
appropriate order. The word "interim" is defined in Black's Law Dictionary as "in the
meantime", "temporary" and "occurring in intervening time". The relevant meaning here
appears to be "occurring in intervening time". Therefore, I am of the view that the Apex
Court has referred to the period till the hearing and disposal of the Chamber Summons.
Now the chamber summon, is disposed of. It is allowed and all amendments are
incorporated in the plaint. Therefore, there is no stage, which is "occurring in intervening
time". In this view of the matter, I do not find any substance in this notice of motion. I,
therefore, pass the following order :
ORDER
Notice of motion stands dismissed. No order as to cost.
The same may be registered for statistical purpose."
By reason of the impugned judgment, the High Court has upheld the said order.
13. Mr. R.F. Nariman, learned senior counsel appearing on behalf of the appellant, inter
alia, would submit that the appellants have never been heard on merit of the matter. The
learned counsel argued that keeping in view the nature and purport of the order of this
Court dated 2.2.2007, the City Civil Court could not have relied upon its earlier order.
Consequently, the High Court had also committed a manifest error in applying the
principles of res judicata which have no application in the instant case. It was contended
that the purported finding of the learned Judge, City Civil Court to the effect that the
defendants had been found to be in actual physical possession of the suit property on the
date of institution of the suit was clearly erroneous inasmuch as no such finding had been
arrived at by the said court while passing its order dated 13.10.2006. It was urged that the
report of an officer appointed by the Revenue Minister found the appellant to be in
possession of the property and in that view of the matter, it was not necessary for them to
pray for a decree for cancellation and setting aside of the agreement for sale dated
23.10.1969. In any event, having regard to the observations made by the High Court, it
was obligatory on the part of the courts below to consider the merit of the matter afresh.
14. Mr. Ashok Desai, learned senior counsel appearing on behalf of the respondents, on
the other hand, contended that the learned City Civil Court rejected the application for
grant of injunction in favour of the appellants, inter alia, holding that - :
(a) Plaintiffs do not have any prima facie case;
(b) They had not approached the Court with clean hands;
(c) The delay in questioning the validity of the said agreement of sale disentitles the
plaintiffs from obtaining the order of injunction and they had not challenged the validity
of the said agreement in the suit.
It was contended that the very fact that the appellants had withdrawn the appeal without
reserving their liberty to move the Trial Judge again for injunction would clearly attract
the principles of res judicata, Mr. Desai would submit that although an opportunity had
been granted to the appellants to pray for a relief of cancellation of
@page-SC808
the said deed of sale, the same was not prayed for which would demonstrate speculative
nature of the litigation resorted to by the plaintiffs. A party to a suit, undoubtedly, may
file an application for injunction if a change in the situation has been brought about but
there being no said change, it was urged, the second application for injunction would not
be maintainable.
15

. It is a trite law that the principles of res judicata apply in different stages of the same
proceedings. [See Satyadhyan Ghosal and Ors. v. Smt. Deorajin Debi and Anr. [AIR 1960
SC 941], Arjun Singh v. Mohindra Kumar and Ors. [AIR 1964 SC 993] and C.V.
Rajendran and Anr. v. N.M. Muhammed Kunhi [(2002) 7 SCC 447], Ishwar Dutt v. Land
Acquisition Collector and Anr.[(2005)7 SCC 190] and Bhanu Kumar Jain v. Archana
Kumar and Anr. [(2005) 1 SCC 787]. 2002 AIR SCW 5315
2005 AIR SCW 3578
2005 AIR SCW 270

The entire claim of the plaintiff was based on their claim of possession of the lands in
suit. Defendants, on the other hand, claimed their right, title, interest and possession on
the basis of the purported agreement for sale. Whether possession had been delivered to
them in part performance of agreement of sale or not is essentially a question of fact.
Genuineness or otherwise of the said agreement also involves determination of a disputed
question.
16. Plaintiffs, while praying for the relief of interim injunction, were bound to establish a
prima facie case. They were also bound to show that the balance of convenience lay in
their favour and unless the prayer is granted, they will suffer an irreparable injury.
The learned Judge, City Civil Court clearly found that prima facie, the plaintiffs' suit was
not maintainable in absence of any prayer for cancellation and setting aside of the said
agreement for sale having been made for in the suit.
Appellants although had been contending that such a relief was not necessary as it was
merely a defence of the respondents, why they did not raise such a question in the
original suit is a matter of guess. We do not know as to why the plaintiffs, despite
opportunities having been given to them, failed to make such a prayer even while seeking
the Court's 'leave' to amend the plaint.
17. The order of the City Civil Court dated 13.10.2006 may be bad but then it was
required to be set aside by the Court of Appeal. An appeal had been preferred by the
appellants thereagainst but the same had been withdrawn. The said order dated
13.10.2006, therefore, attained finality. The High Court, while allowing the appellant to
withdraw the appeal, no doubt, passed an order of status quo for a period of two weeks in
terms of its order dated 23.11.2006 but no reason therefor had been assigned. It ex facie
had no jurisdiction to pass such an interim order. Once the appeal was permitted to be
withdrawn, the Court became functus officio. It did not hear the parties on merit. It had
not assigned any reason in support thereof. Ordinarily, a court, while allowing a party to
withdraw an appeal, could not have granted a further relief. [See G.E. Power Controls
India and Ors. v. S. Lakshmipathy and Ors. [(2005) 11 SCC 509].
18. Even then, the plaintiff preferred to file a fresh notice of motion. It did not file any
application for grant of injunction till the disposal of the suit. It, principally, in the said
notice of motion asked for amendment of the plaint. The second relief prayed for in the
said notice of motion was again withdrawn with liberty to file a fresh notice of motion.
Appellants, therefore, have been filing applications after applications without making
proper prayer therein at all stages.
19. So far as the order of this Court dated 2.2.2007 is concerned at the first blush, it
appears that this Court could not have granted any relief to reagitate the questions of
hearing the parties and interim relief once over again. Even if that be so, the said interim
relief having regard to the admitted facts was to be kept confined only for a short term,
namely, till the application for amendment is considered. This Court, therefore, did not
grant any liberty to the plaintiffs to file a fresh application for injunction. It could not
comprehend thereabout at that time. The Notice of Motion taken out for grant of
injunction was, therefore, required to be considered on its own merit. The plaintiffs had
not brought out any new circumstances warranting grant of any injunction in their favour.
Only because a further prayer had been made in the suit upon amending the plaint, the
same by itself did not bring about a situational change warranting application of mind
afresh by the learned Judge, City Civil Court. The only argument which is
@page-SC809
available to the appellants was that the suit, by reason of amendment made in the prayer,
has become maintainable. Maintainability of the suit itself does not give rise to a triable
issue. The issues which arose for consideration in the suit are the ones we would have
noticed hereinbefore, namely, inter alia, the validity of the agreement for sale and/or grant
of possession in favour of the defendants/respondents. How, by sheer amendment of the
plaint, the plaintiff could prove a prima facie case or show existence of a balance of
convenience in their favour, has not been demonstrated.
20. We are, therefore, of the opinion that although learned Judge, High Court, while
passing its order dated 13.10.2006 could have considered the merit of the application
filed by the appellant in regard to the relief for injunction, the same by itself, in our
opinion, did not warrant a direction to consider the matter afresh by the learned Judge,
City Civil Court.
We are, therefore, are of the opinion that the impugned judgment do not suffer from any
infirmity. We would, however, having regard to the peculiar facts and circumstances of
the case, request the learned Judge, City Civil Court to consider the desirability of
disposing of the suit as expeditiously as possible preferably within a period of six weeks
from the date of communication of this order. The parties are directed to render all
cooperation to the learned Judge in early disposal of the suit. If it is convenient to the
learned Judge, the hearing of the suit may be taken up on day to day basis.
21. This appeal is dismissed with costs. Counsel's fee quantified at Rs.25,000/- (Rupees
twenty five thousand only).
Appeal dismissed.
@page-SC809
AIR 2008 SUPREME COURT 809 "Eastern Book Company v. D. B. Modak"
(From : 2002 (101) DLT 205)
Coram : 2 B. N. AGRAWAL AND PRAKASH PRABHAKAR NAOLEKAR, JJ.
Civil Appeal No. 6472 of 2004, D/- 12 -12 -2007.
Eastern Book Company and Ors. v. D. B. Modak and Anr.
(A) Copyright Act (14 of 1957), S.13, S.52(1)(q)(iv) - COPYRIGHT - Copyright - Law
Journal - Copy-edited judgments - Claims for copyright - Merely establishing amount of
skill, labour and capital put in production of copy-edited judgment - Not sufficient to
claim copyright - Innovative thoughts and creativity necessary to claim copyright -
Derivative work produced must be some- thing different than original.
The judicial pronouncements of the Apex Court would be in the public domain and its
reproduction or publication would not infringe the copyright. That being the position, the
copy-edited judgments would not satisfy the copyright merely by establishing amount of
skill, labour and capital put in the inputs of the copy-edited judgments and the original or
innovative thoughts for the creativity are completely excluded. Accordingly, original or
innovative thoughts are necessary to establish copyright in the author's work. The
principle where there is common source the person relying on it must prove that he
actually went to the common source from where he borrowed the material, employing his
own skill, labour and brain and he did not copy, would not apply to the judgments of the
Courts because there is no copyright in the judgments of the Court, unless so made by the
Court itself. To secure a copyright for the judgments delivered by the Court, it is
necessary that the labour, skill and capital invested should be sufficient to communicate
or impart to the judgment printed in Law Journal some quality or character which the
original judgment does not possess and which differentiates the original judgment from
the printed one. The Copyright Act is not concerned with the original idea but with the
expression of thought. Copyright has nothing to do with originality or literary merit.
Copyrighted material is that what is created by the author by his own skill, labour and
investment of capital, may be it is a derivative work which gives a flavour of creativity.
The copyright work which comes into being should be original in the sense that by virtue
of selection, co-ordination or arrangement of pre-existing data contained in the work a
work somewhat different in character is produced by the author. To claim copyright in a
compilation, the author must produce the material with exercise of his skill and judgment
which may not be creativity in the sense that it is novel or non-obvious, but at the same
time it is not a product of merely labour and capital. The derivative work produced by the
author must have some distinguishable features and flavour to raw text of the
@page-SC810
judgments delivered by the Court. The tribial variation or inputs put in the judgment
would not satisfy the test of copyright of an author.
2004 (1) SCR 339 (Canada), Foll. (Para 38)
Adding, in the copyedited judgment cross-citations to the citation(s) already given in the
original text; adding names of cases and cross-citations where only the citation of the
case is given; adding citation and cross-citations where only name of the case is given;
inserting citation in case history where only the title and year of the impugned/earlier
order is given; presenting in their own style the cases when they are cited, repeated in the
judgment; providing previous references to the quoted matter in the judgment by giving
exact page and paragraph number as in the original case source /treatise /reference
material; adding margin headings to quoted extracts from statutes/ rules, etc., when they
are missing from the original text of the judgment; adding the number of the
Section/Rule/Article/paragraph to the extract quoted in the original text; adding the
names of Judges on whose behalf opinion is given; adding ellipsis "......" to indicate
breaks in quoted extract; supplying the matter inadvertently missed in quoted extracts in
the original text of the judgment; changing the text as per corrigenda issued, etc. etc.,
does not give the Law Journal copyright in the copy-edited judgment. (Paras 39, 40)
(B) Copyright Act (14 of 1957), S.13, S.52(1)(q)(iv) - COPYRIGHT - LAW REPORTS -
JUDGMENT - Copyright - Law Journal - Copy-edited judgment - Adding inputs by
segregating existing paragraphs in original text by breaking them into separate
paragraphs; adding internal paragraph numbering within a judgment after providing
uniform paragraph numbering to multiple judgments; and indicating in judgment the
Judges who have dissented or concurred - Require skill and judgment in great measure -
Such exercise and creation thereof has a flavour of minimum amount of creativity - Law
Journals have copyright in such part. (Para 42)
Cases Referred : Chronological Paras
2004 (1) SCR 339 (Canada) (Foll) 37
(2000) WLR 2416 (HL) 19
AIR 1991 SC 1473 14
AIR 1990 SC 2286 14
AIR 1988 SC 526 14
AIR 1986 SC 1999 14
AIR 1985 SC 1495 7, 18
AIR 1983 Raj 100 7
AIR 1982 MP 1 7
1982 PTC 85 28
AIR 1981 Guj 15 7
AIR 1978 SC 215 14
AIR 1978 SC 1296 : 1978 Cri LJ 1281 14
1976 (3) All ER 184 14
AIR 1975 SC 563 14
AIR 1975 SC 460 14
AIR 1974 SC 497 14
AIR 1973 SC 974 14
AIR 1973 SC 930 : 1973 Lab IC 565 7
AIR 1969 SC 1 7, 18
1969 (2) SCR 375 14
AIR 1968 SC 1379 18
AIR 1967 All 91 26
1964 (1)) WLR 273 (HL) 16
AIR 1961 Madras 111 25
AIR 1955 SC 287 7
AIR 1955 Mad 391 24
1952 ALJ 3322 18
AIR 1948 PC 82 7
AIR 1938 FC 43 7
AIR 1938 All 266 23
AIR 1924 PC 75 36
(1916)2 Ch 601 20, 36
(1900) AC 539 (HL) 18
ILR 13 Bom 358 27
(1901-1904) Cop Cas 49 22
(1866)1 R 1 Eq 697 21
158 F 3d 674 34
18 USPQ 2d 1275 33
IR 18 Eq 444 29
945 F 2d 509 35
ILR 17 Cal 952 29
Raju Ramachandran, Sr. Advocate, Sudeep Mallik, Ms. Anitha Shenoy, Saurab Sinha,
Rishad Ahmad Chowdhury, Raj Shekhar Rao, M. R. Vij, Nitin Ramesh, Samar Bansal, S.
K. Mohanty, Lokesh Kumar, M. K. Garg, Ms. Pratibha M. Singh, Gaurav Sharma,
Bishwajit Dubey, Ms. Shruti Kakker, Sumeet Bhatia and Maninder Singh, Advocates
with him for the Appearing Parties.
Judgement
1. P. P. NAOLEKAR, J. :-These appeals by special leave have been preferred against the
common judgment of a Division Bench of the High Court of Delhi involving the
analogous question and are, therefore, decided together by this judgment.
2. Appellant No. 1 Eastern Book Company is a registered partnership firm carrying on the
business of publishing law books.
@page-SC811
Appellant No. 2 EBC Publishing Pvt. Ltd. is a company incorporated and existing under
the Companies Act, 1956. The said appellants are involved in the printing and publishing
of various books relating to the field of law. One of the well-known publications of
appellant No. 1 Eastern Book Company is the law report Supreme Court Cases
(hereinafter called SCC). The appellant publishes all reportable judgments along with
non-reportable judgments of the Supreme Court of India. Yet another category included
in SCC is short judgments, orders, practice directions and record of proceedings. The law
report SCC was commenced in the year 1969 and has been in continuous publication ever
since. The name Supreme Court Cases has been coined by the appellants and they have
been using the same continuously, exclusively and extensively in relation to the law
reports published by them. For the purpose of publishing the judgments, orders and
proceedings of the Supreme Court, the copies of judgments, orders and proceedings are
procured from the office of the Registrar of the Supreme Court of India. After the initial
procurement of the judgments, orders and proceedings for publication, the appellants
make copy-editing wherein the judgments, orders and record of proceedings procured,
which is the raw source, are copy-edited by a team of assistant staff and various inputs
are put in the judgments and orders to make them user friendly by making an addition of
cross-references, standardization or formatting of the text, paragraph numbering,
verification and by putting other inputs. The appellants also prepare the headnotes
comprising of two portions, the short note consisting of catch/lead words written in bold;
and the long note, which is comprised of a brief discussion of the facts and the relevant
extracts from the judgments and orders of the Court. Headnotes are prepared by appellant
No. 3-Surendra Malik. As per the said appellant (plaintiff No. 3 in the suits filed in the
Delhi High Court), the preparation of the headnotes and putting the various inputs in the
raw text of the judgments and orders received from the Supreme Court Registry require
considerable amount of skill, labour and expertise and for the said work a substantial
amount of capital expenditure on the infrastructure, such as office, equipment, computers
and for maintaining extensive library, besides recurring expenditure on both the
management of human resources and infrastructural maintenance, is made by the
plaintiff-appellants. As per the appellants, SCC is a law report which carries case reports
comprising of the appellants version or presentation of those judgments and orders of the
Supreme Court after putting various inputs in the raw text and it constitutes an 'original
literary work' of the appellants in which copyright subsists under Section 13 of the
Copyright Act, 1957 (hereinafter referred to as the Act) and thus the appellants alone
have the exclusive right to make printed as well as electronic copies of the same under
Section 14 of the Act. Any scanning or copying or reproduction done of or from the
reports or pages or paragraphs or portions of any volume of SCC by any other person, is
an infringement of the copyright in SCC within the meaning of Section 51 of the Act.
3. The defendant-respondent No. 2 Spectrum Business Support Ltd. (in Civil Appeal No.
6472/2004) has brought out a software called "Grand Jurix" published on CD-ROMs and
the defendant-respondent No. 2 Regent Data Tech Pvt. Ltd. (in Civil Appeal No.
6905/2004) has brought out software package called "The Laws" published on CD-
ROMs. As per the appellants, all the modules in the defendant-respondents' software
packages have been lifted verbatim from the appellants' work; the respondents have
copied the appellants' sequencing, selection and arrangement of the cases coupled with
the entire text of copy-edited judgments as published in the plaintiff-appellants' law
report SCC, along with and including the style and formatting, the copy-editing
paragraph numbers, footnote numbers, cross-references, etc.; and such acts of the
defendant-respondents constitute infringement of the plaintiff-appellants' exclusive right
to the same.
4. The plaintiff-appellants herein moved the Court for temporary injunction by filing
applications in Suit No.758/2000 against Spectrum Business Support Ltd. and in Suit No.
624/2000 against Regent Data Tech Pvt. Ltd. before a learned Single Judge of the High
Court of Delhi. The interim orders of injunction were passed in the suits from time to
time. However, the defendant-respondents filed application for vacation of the stay order.
By a common judgment dated 17.1.2001, the Single Judge of the High Court dismissed
the appellants' applications for interim injunction and allowed the
@page-SC812
respondents' application for vacation of stay. However, before the Single Judge, the
respondents conceded that the appellants have copyright in the headnotes and as such
they undertook not to copy these headnotes in their CD-ROMs.
5. Aggrieved by the said order dated 17.1.2001 refusing to grant interim injunction, the
appellants preferred appeals before a Division Bench of the Delhi High Court and the
applications praying for interim relief were also filed in both the appeals. The
applications praying for the interim relief were disposed of by the Division Bench on
9.3.2001 directing that during the pendency of the appeals the respondents will be
entitled to sell their CD-ROMs with the text of the judgment of the Supreme Court along
with their own headnotes which should not in any way be a copy of the headnotes and the
text of the plaintiff-appellants.
6. The Division Bench of the Delhi High Court heard the matters finally and has held that
the appellants are not right in submitting that although the respondents have a right to
publish the raw judgments they could do so only after obtaining the same from the
original source, i.e. after obtaining certified copy of the judgment. The Division Bench
did not agree with the submission of the appellants that by making certain corrections in
the judgments or putting paragraph numbers or arranging the said judgments in a
particular manner while printing, the appellants can claim that the copy-edited judgments
become their 'original literary work'. If the right of a person like the appellants who are
merely reporting the judgments of the courts is stretched to this extent, then after a
judgment is reported by a particular journal, others would be barred from doing the same
and the very purpose of making these judgments in public domain, therefore, would be
frustrated. The Court has further held that the appellants are not the author of the
Supreme Court judgments and by merely making certain corrections therein or giving
paragraph numbers, the character of a judgment does not change and it does not become
materially different from the original judgment. Once a person has a right to obtain
certified copy of the judgment from the Registry of the Court and to publish it, it cannot
be said that he has no right to take text of the judgment from the journal where it is
already reported. The act of reproduction of any judgment or order of the Court, Tribunal
or any other judicial authority under Section 52(1)(q) of the Act, is not an infringement of
the copyright. Any person can, therefore, publish judgments of the Courts. The appellants
may have happened to have first published the judgments, but the same will not mean
that they can have a copyright therein. It is the considered opinion of the Division Bench
that no person can claim copyright in the text of the judgment by merely putting certain
inputs to make it user friendly. The appellants cannot claim copyright in the judgment of
the Court. But it has been held by the Court that reading the judgment and searching the
important portions thereof and collecting sentences from various places for the purposes
of making headnotes would involve labour and skill; and that there is originality and
creativity in preparation of the headnotes, but not when they are verbatim extracts from
the judgment and, therefore, there would be copyright in the headnotes to the judgments
prepared by the appellants. So far as footnotes and editorial notes are concerned, it cannot
be denied that these are the publisher's own creations and based on publisher's own
research and thus will have a copyright of the appellants. The Division Bench modified
the judgment of the Single Judge by directing the respondents that they shall be entitled
to sell their CD-ROMs with the text of the judgments of the Supreme Court along with
their own headnotes, editorial notes, if any, which should not in any way be copy of the
headnotes of the appellants. The respondents shall also not copy the footnotes and
editorial notes appearing in the journal of the appellants. Thus, the Court has not accepted
the case of the appellants that they have a copyright in the copy-edited judgments of the
Supreme Court. Aggrieved by the decision of the Division Bench of Delhi High Court,
the appellants have filed these appeals by special leave.
7. The appellants have claimed that the copyright subsists in SCC as a law report as a
whole based cumulatively and compendiously on all the substantial contributions of skill,
labour and capital in the creation of various parts of SCC, i.e., headnotes, editorial notes,
footnotes, the version of the copy-edited text of judgments as published in the appellants'
law report SCC, the selection of cases as published in SCC, the sequence
@page-SC813
and arrangement of cases as published in SCC and the index, table of cases, etc. which
are published in each volume of SCC, that give it the SCC volumes and thereby complete
SCC set, its character as a work as a whole. The appellants claim that the copyright
subsists in the copy-edited version. The appellants do not claim copyright in the raw text
of the judgments, certified copies of which are obtained from the Registry. The appellants
do not claim a monopoly in publishing judgments of the Supreme Court as they are being
published by other publishers also without copying from each other publication. The
appellants claim that their copyright is in the copy-edited version of the text of judgments
as published in SCC which is a creation of the appellants' skill, labour and capital and
there are contributions/inputs/ additions of the appellants in creating their version of the
text of judgments as published in SCC. The appellants placed before us the following
contributions, inputs and additions made by them to the text in the certified copies of the
judgments received by them from the Registry. The appellants assert that originality
inheres in the following aspects of its editorial process which are selected, coordinated
and arranged in such a way that the resulting work as a whole constitutes an original
work of the appellants.
MATTER ADDED PER SE TO THE RAW TEXT OF THE JUDGMENTS
1. Cross-citations are added to the citations(s) already given in the original text
For example,
a. SCC/AIR/LLJ citations added in addition to the SCR citation given in the text and
cross-citations separated by ?:?

Raw text obtained from Registry : SCC Page : Corresponding citations from SCC
Page :

R. Chitralakha and Anr. v. State of Mysore and Ors. 1964 (6) SCR 368 at 388 and Triloki
Nath v. J. and K State 1969 (1) SCR 103 at 105 and K. C. Vasanth Kumar v. Karnataka
1985 Supp (1) SCR 352 R. Chitralakha v. State of Mysore and Triloki Nath v. State
of J. and K.(II) and K. C. Vasanth Kumar v. State of Karnataka. (1964) 6 SCR 368,
388 : AIR 1964 SC 1823
1969) 1 SCR 103, 105 : AIR 1969 SC 1 : (1970) 1LLJ 629
1985 Supp SCC 714 : 1985 Supp 1 SCR 352
b. FCR, IA, Bom LR citations added in addition to the AIR citation given in raw text and
cross-citations separated by ? : ?

Raw text obtained from Registry : SCC Page : Corresponding citations from SCC
Page :

Dr. Hori Ram Singh v. Emperor (AIR 1938 FC 43), Gokulchand


Dwarkadas Morarka v. The King (AIR 1948 PC 82),
Shreekantiah Ramayya Munipalli v. State of Bombay (AIR 1955 SC 287) Hori Ram
Singh (Dr.) v. Emperor, GokulchandDwarkadas Morarka v. R.. Shreekantiah Ramayya
Munipalli v. State of Bombay. AIR 1939 FC 43 : 1939 FCR 159
AIR 1948 PC 82 : 75 IA 30
AIR 1955 SC 287 : 57 Bom LR 632

@page-SC814
2. (a) Names of cases and cross-citations are added where only the citation of the case is
given in the original text.
For example,
Citation alone given in text replaced with full case name: ?M.P. Oil Extraction (P) Ltd. v.
State of M.P." and Jab LJ cross-citation added to AIR citation already in raw text, and
separated by ? : ?

Raw text obtained from Registry : SCC Page : Corresponding citations from SCC
page :
The said decision has been reported in AIR 1982 MP 1. The said decision has been
reported in M.P. Oil Extraction (P) Ltd. v. State of M.P. AIR 1982 MP 1 : 1982 Jab LJ
795

2(b). Citations and cross-citations are added where only name of the case is given in the
original text.
For example
Name of case in text replaced with full case reference and cross-citations added as per
SCC style.

Raw text obtained from Registry : SCC Page : Corresponding citations from SCC
page :
Division Bench of this Court in Kishan Lal Sharma (supra) Division Bench of this Court
in Kishan Lal Sharma. Kishan Lal Sharma v. Prem Kishore, AIR 1983 Raj 100 :
1983 Raj LR 164
(d) Among the pensioners also, the above anomaly will prevail as pointed out in Janaki
Prasad.(d) Among the pensioners also, the above anomaly will prevail as pointed out in
Janaki Prasad. Janaki Prasad Parimoo v. State of J. and K., (1973) 1 SCC 420

(c). Citation inserted in case-history where only the title and year of the impugned/earlier
orders are given.
For example,
From the Judgment and Order dated June 17, 1980 of Gujarat High Court in Special Civil
Application No. 2711 of 1999: AIR 1981 Guj 15

3. SCC style of presenting (repeatedly) cited cases


For example,
Changes have been made in the name of the cited cases as per SCC style as ?Rattan
Singh?s case (supra)"; ?Mohammad?s case (supra)" and ?Range Forest Officer?s case" in
the raw text consecutively changed to ?Ratan Singh case"; ?Mohammed case and ?Range
Forest Officer case" in SCC.
@page-SC815

Raw text obtained from Registry : SCC Page:


In Rattan Singh?s case (supra), the High Court of Madhya Pradesh finding certain
illegalities in the prosecution relating to setting aside
In Mohammad?s case (supra), the observation of the Kerala High Court that ?if a clear
illegality or injustice comes to the notice of the High Court
In the third case relied on by Justice M.K. Chawla, namely, Range Forest Officer?s case,
a vehicle belonging to the respondent was confiscated. 140. In Ratan Singh case the
High Court of Madhya Pradesh finding certain illegalities in the prosecution relating to
setting aside
141. In Mohammed case, the observations of the Kerela High Court that if a clear
illegality or injustice comes to the notice of the High Court
142. In the third case relied on by Justice M.K. Chawla, namely, Range Forest Officer
case a vehicle belonging to the respondent was confiscated.
* The changes have been underlined.

4. Precise references to quoted matter are provided


For example,
a. The exact page and paragraph number as in the original case source is inserted.

Raw text obtained from Registry : SCC Page :


In Balaji it is stated :
?It seems fairly clear that the backward classes of citizens for whom special provision
After referring to the provisions of Articles 338(3), 340 (1), 341 and 342, the Court
proceeded to hold as follows:
?It would thus be seen that this provision contemplates that some Backward Classes may
by the Presidential order be included In Balaji it is stated: (SCR p. 458)
?It seems fairly clear that the backward classes of citizens for whom special
provisionAfter referring to the provisions of Articles 338(3), 340(1), 341 and 342, the
Court proceeded to hold as follows: (SCR p.458)
?It would thus be seen that this provision contemplates that some Backward Classes may
by the Presidential order be included
It may be appropriate to quote the relevant holding from the judgment:
?When Art. 15(4) refers to the special provision for the advancement of certain classes or
scheduled castes or scheduled tribes, it must not be ignored that the provision which is
authorised to be made It may be appropriate to quote the relevant holding from the
judgment: (SCR pp.467, 470)
?When Article 15(4) refers to the special provision for the advancement of certain classes
or Scheduled Castes and Scheduled Tribes, it must not be ignored that the provision
which is authorised to be made
The Privy Council observed: It may be well to add that their Lordships judgment does not
imply that every sum paid under mistake is recoverable The Privy Council observed:
(IA p.302, para 17)
?It may be well to add that their Lordships? judgment does not imply that every sum paid
under mistake is recoverable
* The changes have been highlighted

@page-SC816
b. The exact page and paragraph number as in the original treatises/reference material is
inserted.

Raw text obtained from Registry : SCC Page :


is very instructive,
?Supposing, for instance, reservations were made for a community or a collection of
communities, the total of which is very instructive: (CAD, Vol. 7, pp. 701-02)
?Supposing, for instance, reservations were made for a community or a collection of
communities, the total of which
is a community which is backward in the opinion of the Government.? is a
community which is backward in the opinion of the Government.? (CAD, Vol. 7, pp. 702)
* The changes have been highlighted.

5. Margin headings are added to quoted extracts from statutes/rules etc. when missing.
For example,
Section number and Margin Heading of the Section have been supplied.

Raw text obtained from Registry : SCC Page :


deals with sovereignty over, and limits of, territorial waters and says:
?(1) The sovereignty of India extends and has always extended to the territorial waters of
India (hereinafter referred to as the territorial waters) and to the seabed and subsoil
underlying, and the air space over such waters. deals with sovereignty over, and
limits of, territorial waters and says:
?3. Sovereignty over, and limits of, territorial waters.- (1) The sovereignty of India
extends and has always extended to the territorial waters of India (hereinafter referred to
as the territorial waters) and to the seabed and subsoil underlying, and the air space over
such waters.
It says: It says:

Raw text obtained from Registry : SCC Page:


(1) All lands, minerals and other things of value underlying the ocean within the
territorial waters, or the continental shelf, or the exclusive economic zone, of India shall
vest in the Union and be held for the purpose of the Union. 297. Things of value within
territorial waters or continental shelf and resources of the exclusive economic zone to
vest in the Union.- (1) All lands, minerals and other things of value underlying the ocean
within the territorial waters, or the continental shelf, or the exclusive economic zone, of
India shall vest in the Union and be held for the purpose of the Union.
That article reads as under:
?19(1) All citizens shall have the right That Article reads as under:
?19. Protection of certain rights regarding freedom of speech, etc.- (1) All citizens shall
have the right

@page-SC817
6. Number of the section/rule/article/paragraph is added to the extract quoted in the
original text
For example,
The sub-section numbers have been added to the text.

Raw text obtained from Registry: SCC Page:


The said provision reads as under:
?Where a landlord has acquired his interest in the premises by transfer, no suit for the
recovery of possession of the premises on any of the grounds mentioned in clause (f) or
clause (ff) of The said provision reads as under:
?13. (3-A) where a landlord has acquired his interest in the premises by transfer, no suit
for the recovery of possession of the premises on any of the grounds mentioned in clause
(f) or clause (ff) of
The said sub-section reads as under:
?If, in the course of any trial under this Act of any offence, it is found that the accused
person has committed any other offence under this Act or any rule made thereunder or
under any other law, he said sub-section reads as under:
?12. (2) If, in the course of any trial under this Act of any offence, it is found that the
accused person has committed any other offence under this Act or any rule made
thereunder or under any other law,
For convenience, we reproduce the sub-section here:
?Any person who is a member of a terrorists gang or a terrorists organization, which is
For convenience, we reproduce the sub-section here:
?3. (5) Any person who is a member of a terrorists? gang or a terrorists? organization,
which is
Sub-section (4) of Section 3 of TADA reads thus:
?whoever harbours or conceals, or attempts to harbour or conceal, any terrorist shall be
punishable with imprisonment for a term which shall not be less than five years but
Section 2 (1) (i) of the TADA which reads thus:-
?Words and expressions used but not defined in this Act and defined in the code shall
have the meanings respectively assigned to them in the Code?
Indian Penal Code by the following words in clause y of Section 2 of the Code:
?words and expressions used herein and not defined but defined in the Indian Penal Code
Sub-section (4) of Section 3 of TADA reads thus:
?3. (4) Whoever harbours or conceals, or attempts to harbour or conceal, any terrorist
shall be punishable with imprisonment for a term which shall not be less than five years
but
Section 2 (1) (i) of TADA which reads thus:
?2. (1) (i) words and expressions used but not defined in this Act and defined in the Code
shall have the meanings respectively assigned to them in the Code?
Indian Penal Code by the following words in clause ?y? of Section 2 of the Code:
?2. (y) words and expressions used herein and not defined but defined in the Indian Penal
Code

7. Phrases like concurring, partly concurring, partly dissenting, dissenting,


supplementing, majority expressing no opinion etc. are added to the original text.
For example,
Words like ?partly dissenting? and ?partly concurring? have been added as per the
application of Editors judgement regarding the opinions expressed by the Judges.
@page-SC818

Raw text obtained from Registry: SCC Page:


D.P. Wadhwa, J.
I agree that the appeal be dismissed.
However, I
S.C. AGRAWAL, J.
Special leave granted.
KOSHAL, J.
On a perusal of the judgment prepared by my learned brother, Krishna Iyer, J., I agree
respectfully with findings (2) to (11), (13) and (14) enumerated by him D. P.
WADHWA, J.- (partly concurring) I agree that the appeal be dismissed. However, I
AGRAWAL, J. (partly dissenting) Special leave granted.
Koshal, J. (partly dissenting) On a perusal of the judgment prepared by my learned
brother, Krishna Iyer, J., I agree respectfully with findings (2) to (11), (13) and (14)
enumerated by him

8. Judges on whose behalf opinion given: Expression such as for himself and Pathak,
C.J., or Fazal Ali and Ranganath Mishra, JJ. etc. are added to the original text.
For example,
A uniform style has been mentioned by SCC to take care of the fact that which judges
have signed the Judgment.

Raw text obtained from Registry: SCC Page:


RANGANATH MISHRA, J.
We have had the benefit of reading the judgment passed
RANGANATHAN, J.
The seeds of the present controversy were sown as early as in 1946. The
Judgments of the Court were delivered by RANGANATH MISHRA, J. (for himself and
Pathak, C.J.) (concurring)
The Judgments of the Court were delivered by
RANGANATHAN, J. (for himself and Ramaswami, J.) - The seeds of the present
controversy were sown as early as in 1946.

9. Existing paragraphs in the original text are broken up and separate paragraph numbers
are given.
For example,
Existing paragraph broken up into two paragraphs and separate paragraph number added
on application of editorial judgment

Raw text obtained from Registry: SCC Page:


but the risk involved in sacrificing efficiency of administration must always be borne in
mind when any State sets about making a provision for reservation of appointments of
posts. We see no justification to multiply the risk, which would be the consequence of
holding that reservation can be provided even in the matter of promotion.
weaker segments of We, the people of India. No other understanding can reconcile the
claim of a radical present and hangover of the unjust past.? A similar view was expressed
in Vasant Kumar by Chinnappa Reddy, J. The learned but the risk involved in
sacrificing efficiency of administration must always be borne in mind when any State sets
about making a provision for reservation of appointments or posts. (SCR p.606)
828. We see no justification to multiply ?the risk?, which would be the consequence of
holding that reservation can be provided even in the matter of promotion.
weaker segments of We, the people of India. No other understanding can reconcile the
claim of a radical present and hangover of the unjust past.?
833. A similar view was expressed in Vasanth Kumar by Chinnappa Reddy, J.

@page-SC819

Raw text obtained from Registry: SCC Page:


Judge said the mere securing of high marks at an examination may not necessarily mark
out a good administrator. The learned Judge said (SCC p. 739, para 36)
?[T]he mere securing of high marks at an examination may not necessarily mark out a
good administrator.

MATTER ADDED UPON VERIFICATION


10. Internal referencing: Use of paragraph numbering for internal referencing within a
judgment.
For example,
Internal paragraph numbering has been added after uniform paragraph numbering have
been provided to the multiple judgments. Para 86, 85, 89, 90, 91 and 92 have been
changed respectively to Paras 790-793, 794 and 797, 798, 799, 800 and 801 to 803.

Raw text obtained from Registry: SCC Page:


(d) ?Creamy layer? can be, and must be excluded. (Para 86)
(e) It is not correct to say that the backward class, social, educational and economic
backwardness are closely inter-twined in the Indian context. (Para 85)
(f) The adequacy of representation of a particular class in the services under the State is a
matter within the subjective satisfaction of the appropriate Government. The judicial
scrutiny in that behalf is the same as in other matters within the subjective satisfaction of
an authority. (Para 89)
(4) (a) A backward class of citizens cannot be identified only and exclusively with
reference to economic criteria. (Para 90)
(b) It is, of course, permissible for the Government or other authority to identify a
backward class of citizens on the basis of occupation-cum-income, without reference to
caste, if it is so advised. (Para 91)
(5) There is no constitutional bar to classify the backward classes of citizens into
backward and more backward categories. (Para 92) (d) ?Creamy layer? can be, and must
be excluded.(Paras 790-793)
(e) It is not necessary for a class to be designated as a backward class that it is situated
similarly to the Scheduled Castes/ Scheduled Tribes. (Paras 794 and 797)
(f) The adequacy of representation of a particular class in the services under the State is a
matter within the subjective satisfaction of the appropriate Government. The judicial
scrutiny in that behalf is the same as in other matters within the subjective satisfaction of
an authority. (Para 798)
(4) (a) A backward class of citizens cannot be identified only and exclusively with
reference to economic criteria. (Para 799)
(b) It is, of course, permissible for the Government or other authority to identify a
backward class of citizens on the basis of occupation-cum-income, without reference to
caste, if it is so advised. (Para 800)
(5) There is no constitutional bar to classify the backward classes of citizens into
backward and more backward categories. (Para 801 to 803)

11. Verification of first word of quoted extract and emphasis supplied on verification.
For example,

Raw text obtained from Registry: SCC Page:


The Rajasthan High Court in CIT v Rangnath Bangur opined:
?.........that once a reassessment pro The Rajasthan High Court in CIT v. Rangnath
Bangur opined: (p.498)
?[T]hat once a reassessment proceeding

@page-SC820

Raw text obtained from Registry: SCC Page:


ceeding is initiated, the original order of assessment is set aside or ceases to be operative.
The finality of such an assessment order is wiped out and a fresh order of assessment
would take the place of and completely substitute the initial order of assessment. It is,
therefore, clear that when is initiated, the original order of assessment is set aside or
ceases to be operative. The finality of such an assessment order is wiped out and a fresh
order of assessment would take the place of and completely substitute the initial order of
assessment. It is, therefore, clear that when
and said :
?reassessment proceedings cannot be contained only to such income which has escaped
assessment, but the entire assessmentand said : (P. 503)
?[R]eassessment proceedings cannot be confined only to such income which has escaped
assessment, but the entire assessment
Five Judges:
?the Constitution is the fundamental law of the land and it is wholly unnecessary to
provide in any law made by the legislature that anything done in disregard of the
Constitution is prohibited. Such a prohibition is to be read in every enactment. ?[T]he
Constitution is the fundamental law of the land and it is wholly unnecessary to provide in
any law made by the legislature that anything done in disregard of the Constitution is
prohibited. Such a prohibition is to be read in every enactment.? (emphasis supplied)

2. Ellipsis ?.......? is added to indicate breaks in quoted extract.For example,

Raw text obtained from Registry: SCC Page:


he has said that ?the word ?caste? appearing after ?scheduled? is really a misnomer and
has been used only for the purpose of identifying this 165), he has said that
?.......the word ?caste? appearing after ?scheduled? is really a misnomer and has been
used only for the purpose of identifying this
Gajendragadkar, J observed:
?Though castes in relation to Hindus may be a relevant factor to consider in determining
the social backwardness of groups or classes of citizens, it cannot be the sole or the
dominant test in that behalf. Gajendragadkar, J. observed:
?.........though castes in relation to Hindus may be a relevant factor to consider in
determining the social backwardness of groups or classes of citizens, it cannot be made
the sole or the dominant test in that behalf.
manner as may be prescribed duties of excise on all excisable goods which are produced
or manufactured in India as, and at the rates, set forth in the Schedule to the Central
Excise Tariff Act, 1985. manner as may be prescribed duties of excise on all
excisable goods.... which are produced or manufactured in.... India as, and at the rates, set
forth in the Schedule to the Central Excise Tariff Act, 1985.

13. Matter inadvertently missed in quoted extracts is supplied.


For example,
Incorporation of matter missing in quotations from cases.
@page-SC821

Raw text obtained from Registry: SCC Page:


Where there is no express exclusion the examination of the remedies and the scheme of
the particular Act to find out the intendment becomes necessary to see if the statute
creates a special right or a liability and provides for the determination of the right Where
there is no express exclusion the examination of the remedies and the scheme of the
particular Act to find out the intendment becomes necessary and the result of the inquiry
may be decisive. In the latter case
Mr Justice M. K. Chawla holding that parties have no locus standi. Mr Justice M.K.
Chawla holding that Mr. H.S. Chowdhary and other intervening parties have no locus
standi.
"38. State to secure a social order for the promotion of welfare of the people. (1) The
State shall strive to promote the welfare of the people by securing and protecting as
effectively as it may a social, economic and political, shall inform all the institutions of
the national life. "38. State to secure a social order for the promotion of welfare of
the people.- (1) The State shall strive to promote the welfare of the people by securing
and protecting as effectively as it may a social order in which justice, social, economic
and political, shall inform all the institutions of the national life.
The inputs of efficiency include a sense of belonging and of accountability (not
pejoratively used) if its composition takes in also the weaker segments of we, the people
of India. The inputs of efficiency include a sense of belonging and of accountability
which springs in the bosom of the bureaucracy (not pejoratively used) if its composition
takes in also the weaker segments of We, the people of India.
"It is no doubt true that the Act was amended by U.P. Act 26 of 1975 which came into
force on August 18, 1975 taking away the power of the Director to make an appointment
under Section 16 F (4) of the Act in the case of minority institutions. The amending Act
did not, however, provide proceedings under Section 16F of the Act. "It is no doubt
true that the Act was amended by U.P. Act 26 of 1975 which came into force on August
18, 1975 taking away the power of the Director to make an appointment under Section
16-F(4) of the Act in the case of minority institutions. The amending Act did not,
however, provide expressly that the amendment in question would apply to pending
proceedings under Section 16-F of the Act.
* The changes have been underlined.

14. Incomplete/incorrect case names or citations are completed/corrected.


For example,
Corrections in the case names.
@page-SC822

Raw text obtained from Registry SCC Page:


In R v. Greater London Council 1976 (3) ALL ER 184, one Albert Raymond Blackburn
73. In R v. Greater London Council, ex parte Blackburn, one Albert Raymond
Blackburn
Ray, C.J. in State of Uttar Pradesh v. Pradeep Tandon and Ors. 1975 (2) SCR 761 at 766
has gone to the extent of saying that: 47. Ray, CJ in State of U.P. v. Pradip Tandon has
gone to the extent of saying that: (SCC pp. 273-74, para 15)
Reference may be made to (1) Hindustan Zinc v. A.P. State Electricity Board, 1991 (3)
SCC 299; (2) Sitaram Sugars v. Union of India and Others, 1990 (3) SCC 223; (3)
D.C.M. v. S. Paramjit Singh, 1990 (4) SCC 723; (4) Minerva Talkies v. State of
Karnataka and Others, 1988 Suppl SCC 176; (5) State of Karnataka v. Ranganath Reddy,
1978 (1) SCR 641; (6) Kerala State Electricity Board v. S.N. Govind Prabhu, 1986 (4)
SCC; (7) Prag Ice Company v. Union of India and Others, 1978 (2) SCC 458; (8)
Sarawaswati Industries Syndicate Ltd. v. Union of India, 1975 (1) SCR 956; (9) Murti
Match Works v. Assistant Collector, Central Excise and Others, 1974 (3) SCR 121; (10)
T. Govindraja Mudaliar v. State of Tamil Nadu and Others, 1973 (3) SCR 222; and (11)
Narender Kumar v. Union of India and Others, 1969 (2) SCR 375. Reference may be
made to : (1) Hindustan Zinc Ltd. v. A.P. State Electricity Board; (2) Shri Sitaram Sugar
Co. Ltd. v. Union of India; (3) Delhi Cloth and General Mills Ltd. v. S. Paramjit Singh;
(4) Minerva Talkies v. State of Karnataka; (5) State of Karnataka v. Ranganath Reddy; (6)
Kerela State Electricity Board v. S.N.Govinda Prabhu and Bros.; (7) Prag Ice and Oil
Mills v. Union of India; (8) Saraswati Industries Syndicate Ltd. v. Union of India; (9)
Murthy Match Works v. Assistant Collector, Central Excise; (10) T. Govindaraja
Mudaliar v. State of T.N. and (11) Narender Kumar v. Union of India.
* The changes have been underlined.

15. Other corrections


For example,
a. Clauses numbered in terms of answers to questions framed by learned Judge have
been renumbered correctly in terms of questions framed, as (3)(e) actually has been found
to be answer to (3) (c) and vice-versa.
a1. Similarly, clause has been changed to sub-clause.

Raw text obtained from Registry: SCC Page:


(c) It is not necessary for a class to be designated as a backward class that it is situated
similarly to the Schedule Castes/Tribes. (Paras 87 and 88)
(d) Creamy layer can be, and must be excluded. (Para. 86)
(e) It is not correct to say that the back (c) It is not correct to say that the backward
class of citizen contemplated in Article 16 (4) is the same as the socially and
educationally backward classes referred to in Article 15(4). It is much wider. The accent
in Article 16(4) is on social backwardness. Of course, social, educational and economic
backwardness are closely inter-

@page-SC823

Raw text obtained from Registry: SCC Page:


ward class of citizen contemplated in Article 16 (4) is the same as the socially and
educationally backward classes referred to in Article 15(4). It is much wider. The accent
in Article 16(4) is on social backwardness. Of course, social, educational and economic
backwardness are closely inter-twined in the Indian context. twined in the Indian
context. (Paras 786-789)
(d) Creamy Layer can be, and must be excluded. (790-793)
(e) It is not necessary for a class to be designated as a backward class that it is situated
similarly to the Schedule Castes/ Schedule Tribes. (Paras 794 and 797)
that no better formula could be produced than the one that is embodied in clause (3) of
Article 10 of the Constitution; they will find that the view of those who believe and hold
that there shall be that no better formula could be produced than the one that is
embodied in sub-clause (3) of Article 10 of the Constitution; they will find that the view
of those who believe and hold that there shall be
16. Text has been changed as per corrigenda issued, which have been issued upon SCC
Editor?s request and suggestions.
For example,
SUPREME COURT OF INDIA
Corrigendum
This Courts order dated October 25, 1996 in CA 14553/96 @ SLP (C) No. 5570/93 in the
matter of Smt. Indira Sohan Lal (Dead) by LRs. v. Union of India

Page No. Line No. For Read

1 bottom line and deducted deducted


2 7-8 from bottom developed to bring on par with levelled land and huge
developed tobring them on levelled landand a huge
3 12-13 from bottom compelling material,nor the High Court refused to advert to
compelling material and High Court?s refusal to advert to it,

OTHER ADDITIONS/INSERTIONS MADE TO THE RAW TEXT


17. Compressing/simplification of information relating to case history.
For example

Raw text obtained from Registry: SCC Page:


CIVIL APPEAL NOS. 999-1005 OF 1997
[ARISING OUT OF S.L.P. (C) NOS. 18380-86 OF 1996] Civil Appeals Nos. 999 to
1316 of 1997 with I.A. No. 1 in C.As. arising out of SLPs. (C) Nos. 24224, 24285,
24315, 24320-22, 24325-26 and 24328-29 of 1996, decided on February 20, 1997.
WITH
CIVIL APPEAL NOS. 1006-1316 OF 1997 [ARISING OUT OF S.L.P. (C) NOS.
20293/96,

@page-SC824

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20662/96, 21726/96, 21824-26/96, 22224-502/96, 22771/96, 23196-97/96, 23199/96,
23700-703/96, 23744/96,23747-48/96, 23761/96, 23763/96, 23766/96, 23775-76/96,
24285/96,24315/96,24320-22/96, 24325-26/96, 24328-29/96 and 24224/96
WITH
INTERLOCUTORY APPLICATION NO.1
IN
CIVIL APPEALS
[ARISING OUT OF S.L.P.(C)NOS. 24224/96,24285/96,24315/96,24320-22/96, 24325-
26/96 and 24328-29/96.
passed by Madhya Pradesh High Court respectively in Misc. Petitions No. 1371 of 1992,
M.P. No. 1980 of 1992 and M.P. No. 2315 of 1992. All the said Misc. Petitions were filed
before the Madhya Pradesh High Court under Article 226 of the Constitution. passed
by Madhya Pradesh High Court respectively in Miscellaneous Petitions Nos. 1371, 1980
and 2315 of 1992. All the said miscellaneous petitions were filed before the Madhya
Pradesh High Court under Article 226 of the Constitution
* The changes have been underlined.

(SCC HAS UNIQUE STYLE)


18. There are certain norms followed at SCC for giving case names.
For example,

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Budh Prakash Jai Prakash v. Sales Tax Officer, Kanpur [1952 A.L.J. 332] Budh Prakash
Jai Prakash v. STO
Indian Aluminium Cables Limited vs. State of Haryana Indian Aluminium Cables
Ltd. v. State of Haryana
Trilok Nath Tiku and Another v. State of Jammu and Kashmir and Others Triloki Nath
Tiku v. State of J and K (I)
R. Chitralekha and Anr. v. State of Mysore and Ors. 1964 (6) SCR 368 at 388 and Triloki
Nath v. J and K State 1969 (1) SCR 103 at 105 and K.C. Vasanth Kumar v. Karnataka
1985 Supp. (1) SCR 352 R. Chitralekha v. State of Mysore and Triloki Nath v. State
of J and K (II) and K.C. Vasanth Kumar v. State of Karnataka
Minor P. Rajendran V. State of Madras and Ors. 1968 (2) SCR 786 at 790 P. Rajendran v.
State of Madras
State of Andhra Pradesh V. P. Sagar 1968 (3) SCR 595 State of A.P. v. P. Sagar
K.S. Venkataraman and Bharat Kala Bhandar Ltd. v. M.C. Dhamangaon K.S.
Venkataramanan and Bharat Kala Bhandar Ltd. v. Municipal Committee

19. Words like Section, Sec., Rule etc. are omitted, and only the number of the
Section/Rule is given at the beginning of the quoted extract.
@page-SC825

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Sec 2 (h). terrorist act has the meaning assigned to it in sub-section (1) of Section 3, and
the expression terrorist shall be construed accordingly;
?Rule 11. No refund of duties or charges erroneously paid, unless claimed within three
months ? No duties or charges which have been paid or have been adjusted in an account
current maintained with the Collector
?RULE 233B. Procedure to be followed to cases where duty is paid under protest.? (1)
Where an assessee desires to pay duty under protest he shall deliver to the proper officer
a letter to this ?2 (h) terrorist act has the meaning assigned to it in sub-section (1) of
Section 3, and the expression terrorist shall be construed accordingly;?
?11. No refund of duties or charges erroneously paid, unless claimed within three
months.? No duties or charges which have been paid or have been adjusted in an account
current maintained with the Collector
?233-B. Procedure to be followed in cases where duty is paid under protest. (1) Where an
assessee desires to pay duty under protest he shall deliver to the proper officer a letter to
this
20. Margin heading and the first clause/sub-section or initial matter of section/rule etc. is
made to run-on, instead of being let to start from a fresh line.

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?Liability of person to whom money is paid or thing delivered by mistake or under
coercion? 72. A person to whom money has been paid, or anything delivered, by mistake
or under coercion, must repay or return it. ?72. Liability of person to whom money is
paid or thing delivered, by mistake or under coercion.? A person to whom money has
been paid, or anything delivered, by mistake or under coercion, must repay or return it.
Sec 424. Refund of automobile accessories tax.
(a) No refund shall be made of any amount paid by or collected from any manufacturer,
producer, or importer in respect ?424. Refund of automobile accessories tax.? (a) No
refund shall be made of any amount paid by or collected from any manufacturer,
producer, or importer in respect
Section 3, which is the charging Section, reads:-3. Duties specified in the Schedule to the
Central Excise Tariff Act, 1985 to be levied.
(1) There shall be levied and collected in such manner as may be prescribed duties?175.
Section 3, which is the charging section, reads:
?3. Duties specified in the Schedule to the Central Excise Tariff Act, 1985 to be levied. -
(1) There shall be levied and collected in such manner as may be prescribed duties

21. Compressing of unquoted referends and use of *** for such parts.

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?six months?, the words ?five years? were substituted.
Explanation
(ii) ?relevant date- means,
(a) in the case of excisable goods on which duty of excise has not been levied or paid or
has been short-levied or short-paid ....
(c) in any other case, the date on which ?six months?, the words ?five years? were
substituted.
Explanation.?
(1)-(2) * * *
(3) (i) * * *
(ii) ?relevant date? means, ?
(a) in the case of excisable goods on which duty of excise has not been levied or paid or
has been short-levied or short-paid ....

@page-SC826

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the duty is to be paid under this Act or the rules made thereunder; (c) in any other case,
the date on which the duty is to be paid under this Act or the rules made thereunder,
(i).................. * *
(ii)................... * *
(iii) where the landlord of any building is
(1)a serving or retired Indian Soldier as defined in the Indian Soldiers (Litigation) Act,
1925 (IV of 1925) and such building was let out at any time before his retirement, or
(2) ................
and such landlord needs such building for occupation by himself or the members of his
family for residential purposes, (i)-(ii) * * *
(iii) where the landlord of any building is?
(1) a serving or retired Indian Soldier as defined in the Indian Soldiers (Litigation) Act,
1925 (IV of 1925), and such building was let out at any time before his retirement, or
(2) * * *
and such landlord needs such building for occupation by himself or the members of his
family for residential purposes,

22. Series of dots in the raw texts (i.e., ..........) are replaced with ellipsis (i.e.,....).

Raw text obtained from Registry: SCC Page:


so to say into the administration.............. .that no better formula could be produced than
the one that is embodied in clause (3) of Article 10 of the Constitution; they will find that
the view of those who believe and hold that there shall be equality of opportunity has
been embodied in sub-clause (1) of Article 10. It is a generic principle
................Supposing for instance, we are to concede in full the demand of those
communities who have not been so far employed in the public services to the fullest
extent, what would really happen is, we shall be completely destroying the first
proposition upon which we are all agreed, namely, that there shall be in an equality of
opportunity............ . I am sure they will agree that unless you use some such qualifying
so to say into the administration......... that no better formula could be produced
than the one that is embodied in sub-clause (3) of Article 10 of the Constitution; they will
find that the view of those who believe and hold that there shall be equality of
opportunity, has been embodied in sub-clause (1) of Article 10. It is a generic
principle......... Supposing for instance, we are to concede in full the demand of those
communities who have not been so far employed in the public services to the fullest
extent, what would really happen is, we shall be completely destroying the first
proposition upon which we are all agreed, namely, that there shall be in an equality of
opportunity..................... I am sure they will agree that unless you use some such
qualifying

23. Removal of abbreviations: sec., R. and cl. are substituted respectively with ?Section?,
?Rule? or ?clause?.

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Having regard to the object and language of s. 34 of the I.T. Act, 1922, s. 147 of the I.T.
Act, 1961, and s. 8 of the Surtax Act, 1964, the reopening of an assessment can only be
for the ben ?Having regard to the object and language of Section 34 of the I.T. Act,
1922, Section 147 of the I.T. Act, 1961, and Section 8 of the Surtax Act, 1964, the
reopening of an assessment can only be for the benefit of the Revenue subject to one
exception,
@page-SC827

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efit of the Revenue subject to one exception,
?...........it would not be in accordance either with cl. (1) of Art. 15 or cl. (2) of Art. 29 to
require the consideration of the castes of persons to be borne in mind for determining
what are socially and educationally backward classes. It is true that cl. (4) of Art. 15
contains a non-obstante clause with the result ?.............it would not be in
accordance either with clause (1) of Article 15 or clause (2) of Article 29 to require the
consideration of the castes of persons to be borne in mind for determining what are
socially and educationally backward classes. It is true that clause (4) of Article 15
contains a non-obstante clause with the result
* The changes have been underlined.

24. Hyphenation has been added after the section/rule numbers, which have alphabets,
suffixed to them.

Raw text obtained from Registry: SCC Page:


SCOPE OF SECTIONS 11B, 11D, 12A, 12B, 12C AND 12D OF THE CENTRAL
EXCISE ACT, 1944
Sections 11B and 11D in Chapter II and Sections 12A, 12B, 12C and 12D in Chapter II-A
are now to be considered :?
?11B. Claim for refund of duty
(1) Any person claiming refund of any duty of excise may make an application for refund
of such duty to the Assistant Commissioner of Central Excise before the Scope of
Sections 11-B, 11-D, 12-A, 12-B, 12-C and 12-D of The Central Excises and Salt Act,
1944
Sections 11-B and 11-D in Chapter II and Sections 12-A, 12-B, 12-C and 12-D in
Chapter II-A are now to be considered:
?11B. Claim for refund of duty.?
(1) Any person claiming refund of any duty of excise may make an application for refund
of such duty to the Assistant Collector of Central Excise before the
*The changes have been underlined.

25. Indentation
For example
SCC style of presentation of quoted extracts in separate indented paragraphs applied to
raw text.

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As Chinnappa Reddy, J. in Vasanth Kumar has rightly observed, Always one hears the
word efficiency as if it is sacrosanct and the sanctorum has to be fiercely guarded.
Efficiency is not a mantra which is whispered by the Guru in the Sishya?s ear.? 57. As
Chinnappa Reddy, J. in Vasanth Kumar has rightly observed: (SCC p.739, para 36)
?Always one hears the word efficiency as if it is sacrosanct and the sanctorum has to be
fiercely guarded. Efficiency is not a mantra which is whispered by the Guru in the
Sishya?s ear.?

26. Removal of full stops or removal of word ?No.?..


@page-SC828

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The appellant says that each of these R.S.Os. maintains an office, a stock yard and other
necessary paraphernalia for receiving, stocking, repairing and delivering motor vehicles
to their customers. The appellant says that almost seventy percent of its sales are to
parties other than State Transport Undertakings S.T.Us. The sales to S.T.Us., are in the
region of thirty percent of its production. The R.S.Os., the appellant says, contact the
local purchasers and the S.T.Us., book the order and also deliver the vehicles to them
pursuant to sales effected by them. The appellant always keeps the R.S.Os. well stocked
having regard to their requirements. By way of illustration, it is stated, the R.S.O. at
Hyderabad
All the three special leave petitions namely S.L.P. (Civil) No. 19279 of 1995, S.L.P.
(Civil ) No. 20137 of 1995 and S.L.P. (Civil ) No. 19796 of 1995 are directed against
common judgment dated 9.5.1995 The appellant says that each of these RSOs
maintains an office, a stock yard and other necessary paraphernalia for receiving,
stocking, repairing and delivering motor vehicles to their customers. The appellant says
almost seventy per cent of its sales are parties other than State Transport Undertakings
(STUs). The sales to STUs are in the region of thirty per cent of its production. The
RSOs, the appellant says, contact the local purchasers and the STUs book the orders and
also deliver the vehicles to them pursuant to sales effected by them. The appellant always
keeps the RSOs well stocked having regard to their requirements. By way of illustration,
it is stated, the RSO at Hyderabad
2. All the three special leave petititions namely SLP (Civil) No. 19729 of 1995, SLP
(Civil ) No. 20137 of 1995 and SLP (Civil ) No. 19796 of 1995 are directed against
common judgment dated 9-5-1995* The changes have been underlined.

27. Giving full forms of abbreviations to enhance readability and clarity.

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from legal consequences and therefore, they are also guilty of the offence u/s 201 IPC.
from legal consequences and therefore, they are also guilty of the offence under
Section 201, IPC.
* The changes have been underlined.

In addition to the above, capitalization and italicization is made wherever necessary in the
raw text; and punctuation, articles, spellings and compound words are also checked and
corrected, if required, in the original text.
8. The copyright protection finds its justification in fair play. When a person produces
something with his skill and labour, it normally belongs to him and the other person
would not be permitted to make a profit out of the skill and labour of the original author
and it is for this reason the Copyright Act, 1957 gives to the authors certain exclusive
rights in relation to the certain work referred in the Act. The object of the Act is to protect
the author of the copyright work from an unlawful reproduction or exploitation of his
work by others. Copyright is a right to stop others from exploiting the work without the
consent or assent of the owner of the copyright. A copyright law presents a balance
between the interests and rights of the author and that of the public in protecting the
public domain, or to claim the copyright and protect it under the copyright statute. One of
the key requirements is that of originality which contributes, and has a direct nexus, in
maintaining the interests of the author as well as that of public in protecting the matters in
public domain. It is a well-accepted principle of copyright law that there is no copyright
in the facts per se, as the facts are not created nor have they originated with the author of
any work which embodies these facts. The issue of copyright is closely connected to that
of commercial viability, and commercial con
@page-SC829
sequences and implications.
9. The development of copyright law in India is closely associated with the British
copyright law. Statute of Anne, the first Copyright Act in England, was passed in 17th
century which provided that the author of any book already printed will have the sole
right of printing such book for a term mentioned therein. Thereafter, came the Act of
1814, and then the Act of 1842 which repealed the two earlier Acts of 1709 and 1814.
The Copyright Act of 1911 in England had codified and consolidated the various earlier
Copyright Acts on different works. Then came the Copyright Act of 1956. In India, the
first Copyright Act was passed in 1914. This was nothing but a copy of the Copyright Act
of 1911 of United Kingdom with suitable modifications to make it applicable to the then
British India. The Copyright Act of 1957, which is the current statute, has followed and
adopted the principles and provisions contained in the U.K. Act of 1956 along with
introduction of many new provisions. Then came the Copyright (Amendment) Act, 1983
which made a number of amendments to the Act of 1957 and the Copyright
(Amendment) Act, 1984 which was mainly introduced with the object to discourage and
prevent the widespread piracy prevailing in video films and records. Thereafter, the
Copyright (Amendment) Act, 1994 has effected many major amendments in the
Copyright Act of 1957.
10. In the present case, the questions which require determination by the Court are : (1)
What shall be the standard of originality in the copy-edited judgments of the Supreme
Court which is a derivative work and what would be required in a derivative work to treat
it the original work of an author and thereby giving a protected right under the Copyright
Act, 1957 to the author of the derivative work ? and (2) Whether the entire version of the
copy-edited text of the judgments published in the appellants law report SCC would be
entitled for a copyright as an original literary work, the copy-edited judgments having
been claimed as a result of inextricable and inseparable admixture of the copy-editing
inputs and the raw text, taken together, as a result of insertion of all SCC copy-editing
inputs into the raw text, or whether the appellants would be entitled to the copyright in
some of the inputs which have been put in the raw text ?
11. Copyright is purely a creation of the statute under the 1957 Act. What rights the
author has in his work by virtue of his creation, are defined in Sections 14 and 17 of the
Act. These are exclusive rights, but subject to the other provisions of the Act. In the first
place, the work should qualify under the provisions of Section 13, for the subsistence of
copyright. Although the rights have been referred to as exclusive rights, there are various
exceptions to them which are listed in Section 52.
12. We are mainly concerned for the purpose of these appeals with Sections 2 [clauses
(k), (o), (y)], 13(1), 14(1)(a), 17, proviso (d) and 52(1)(q)(iv) of the Copyright Act, 1957.
The relevant provisions of these Sections are as under :
2. Interpretation.? In this Act, unless the context otherwise requires,
xxx xxx xxx
(k) ?Government work? means a work which is made or published by or under the
direction or control of
(i) the Government or any department of the Government;
ii) any Legislature in India;
(iii) any Court, Tribunal or other judicial authority in India;
xxx xxx xxx
(o) ?literary work? includes computer programmes, tables and compilations including
computer databases;
xxx xxxxxx
?(y) ?work? means any of the following works, namely :?
(i) a literary, dramatic, musical or artistic work;
(ii) a cinematograph film;
(iii) a sound recording;
"13. Works in which copyright subsists.? (1) Subject to the provisions of this section and
the other provisions of this Act, copyright shall subsist throughout India in the following
classes of works, that is to say,?
(a) original literary, dramatic, musical and artistic works;
(b) cinematograph films; and
(c) sound recording,
(2) Copyright shall not subsist in any work specified in sub-section (1), other than a work
to which the provisions of section 40 or section 41, apply, unless?
(i) in the case of a published work, the
@page-SC830
work is first published in India, or where the work is first published outside India, the
author is at the date of such publication, or in a case where the author was dead at that
date, was at the time of his death, a citizen of India;
(ii) in the case of an unpublished work other than a work of architecture, the author is at
the date of the making of the work a citizen of India or domiciled in India; and
(iii) in the case of a work of architecture, the work is located in India.
Explanation.? In the case of a work of joint authorship, the conditions conferring
copyright specified in this sub-section shall be satisfied by all the authors of the work.
(3)Copyright shall not subsist?
(a) in any cinematograph film if a substantial part of the film is an infringement of the
copyright in any other work;
(b) in any sound recording made in respect of a literary, dramatic or musical work, if in
making the sound recording, copyright in such work has been infringed.
xxx xxxxxx
14. Meaning of copyright.? (1) For the purposes of this Act, ?copyright? means the
exclusive right, subject to the provisions of this Act, to do or authorise the doing of any of
the following acts in respect of a work or any substantial part thereof, namely :?
(a) in the case of a literary, dramatic or musical work, not being a computer programme,?
(i) to reproduce the work in any material form including the storing of it in any medium
by electronic means;
(ii) to issue copies of the work to the public not being copies already in circulation;
(iii) to perform the work in public, or communicate it to the public;
(iv) to make any cinematograph film or sound recording in respect of the work;
(v) to make any translation of the work;
(vi) to make any adaptation of the work;
(vii) to do, in relation to a translation or an adaptation of the work, any of the acts
specified in relation to the work in sub-clauses (i) to (vi);
xxx xxxxxx?
17. First owner of copyright.? Subject to the provisions of this Act, the author of a work
shall be the first owner of the copy right therein :
Provided that?
xxx xxxxxx
(d) in the case of a Government work, Government shall, in the absence of any agreement
to the contrary, be the first owner of the copyright therein;
xxx xxxxxx?
?52. Certain acts not to be infringement of copyright.? (1) The following acts shall not
constitute an infringement of copyright, namely :?
(a) .....
xxx xxxxxx
(q) the reproduction or publication of?
(i) .........
xxx xxxxxx
(iv) any judgment or order of a Court, Tribunal or other judicial authority, unless the
reproduction or publication of such judgment or order is prohibited by the Court, the
Tribunal or other judicial authority, as the case may be;
xxx xxxxxx?
13. Subject to the provisions of Section 13 and the other provisions of the Act, there shall
be a copyright throughout India in original literary work, dramatic, musical and artistic
works, cinematograph films and sound recording, subject to the exceptions provided in
sub-sections (2) and (3) of Section 13. For copyright protection, all literary works have to
be original as per Section 13 of the Act. Broadly speaking, there would be two classes of
literary works : (a) primary or prior works: These are the literary works not based on
existing subject-matter and, therefore, would be called primary or prior works; and (b)
secondary or derivative works: These are literary works based on existing subject-matter.
Since such works are based on existing subject-matter, they are called derivative work or
secondary work. Work is defined in Section 2(y) which would be a literary, dramatic,
musical or artistic work; a cinematograph film; and a sound recording. Under Section
2(o), literary work would include computer programmes, tables and compilations
including computer databases. For the purposes of the Act, Section 14(1) enumerates
what shall be a copyright which is an exclusive right, subject to the provisions of the Act,
to do or authorize the doing of the acts provided in clauses (i) to (vii)
@page-SC831
in respect of a work or any substantial part thereof in the case of a literary, dramatic or
musical work, not being a computer programme. Section 2(k) defines the "government
work" which would be a work which is made or published by or under the direction or
control of, amongst others, any Court, Tribunal or other judicial authority in India. By
virtue of this definition, the judgments delivered by the Supreme Court would be a
government work. Under Section 17(d), the Government shall, in the absence of any
agreement to the contrary, be the first owner of the copyright in a government work. In
the absence of any agreement to the contrary, the government shall be the first owner of
the copyright in the judgments of the Supreme Court, the same being a government work
under Section 2(k). Section 52(1) expressly provides that certain acts enumerated therein
shall not constitute an infringement of copyright and sub-clause (iv) of clause (q)
excludes the reproduction or publication of any judgment or order of a Court, Tribunal or
other judicial authority, unless the reproduction or publication of such judgment or order
is prohibited by the Court, the Tribunal or other judicial authority from copyright. The
judicial pronouncements of the Apex Court would be in the public domain and its
reproduction or publication would not infringe the copyright. The reproduction or
publication of the judgments delivered by the Supreme Court by any number of persons
would not be infringement of a copyright of the first owner thereof, namely, the
Government, unless it is prohibited. The question, therefore, is whether by introducing
certain inputs in a judgment delivered by a court it becomes original copy-edited
judgment and the person or authority or company who did so could claim to have
embodied the originality in the said judgment and the judgment takes the colour of
original judgment having a copyright therein of its publisher.
14. In many cases, a work is derived from an existing work. Whether in such a derivative
work, a new copyright work is created, will depend on various factors, and would one of
them be only skill, capital and labour expended upon it to qualify for copyright protection
in a derivative literary work created from the pre-existing material in the public domain,
and the required exercise of independent skill, labour and capital in its creation by the
author would qualify him for the copyright protection in the derivative work. Or would it
be the creativity in a derivative work in which the final position will depend upon the
amount and value of the corrections and improvements, the independent skill and labour,
and the creativity in the end-product is such as to create a new copyright work to make
the creator of the derivative work the author of it; and if not, there will be no new
copyright work and then the original author will remain the author of the original work
and the creator of the derivative work will have been the author of the alterations or the
inputs put therein, for their nature will not have been such as to attract the protection
under the law of copyright.
15. It is submitted by Shri Raju Ramachandran, learned senior counsel for the appellants
that Section 52(1)(q)(iv) of the Act does not bar the recognization of copyright in the
copy-edited version of the text of judgments of the courts as published in law reports. The
Government is the first owner of copyright in the judgments of the courts as per Section
2(k) read with Section 17 and Section 52(1)(q)(iv) of the Act provides that any person
wanting to reproduce or publish judgments would not infringe the copyright of the
Government, but Section 52(1)(q)(iv) does not imply that in case a person has expended
independent skill, labour and capital on the judgments of the courts to create and publish
his version of the judgments, any other person is free to copy that persons version of the
judgments, substantially or in its entirety. Copyright subsists in the copy-edited version of
the text of judgments of the courts as published in law reports, which have been created
by the application of skill, labour and capital which is not trivial or negligible. The inputs
put in the copy-edited judgments in SCC, is a derivative literary work created from pre-
existing material of the judgments of the court which is in public domain. The exercise of
independent skill, labour and capital in its creation by the author of such work, and the
derivative literary work created by the expenditure of the independent skill, labour and
capital of the appellants gives them copyright in such creations. It is not necessary that
work created should have a literary merit. The courts can only evaluate whether the skill,
labour and capital actually employed, required in creating the work, is not trivial or
negligible. It is further urged
@page-SC832
by the learned senior counsel that in deciding whether a derivative work qualifies for
copyright protection, it must be considered as a whole, and it is not correct to dissect the
work into fragments and consider the copyrightability of each such fragment piecemeal
and individually apart from the whole. He submits that the respondents if wish to
reproduce or publish a work already in public domain is obliged to go to the public
domain/common source of such work rather than misappropriating the effort and
investment of the appellants by copying the version of such work which was created by
them by independent expenditure of skill, labour and capital. To buttress his submissions,
the learned senior counsel placed reliance on various foreign judgments and judgments of
the Indian High Courts which are considered hereinafter.
16. Ladbroke (Football) Ltd. v. Willim Hill (Football) Ltd., [1964] 1 WLR 273 (HL), is a
case where the concept of originality was considered on the basis of skill, judgment
and/or labour in the context of compilation. Since 1951 the respondents, who were well-
known bookmakers, had sent their customers each week fixed odds football betting
coupons arranged in a certain general form. In 1959 the appellants, who were also
bookmakers, started sending out coupons closely resembling the respondents coupons. A
coupon was a sheet of paper on which were printed several lists of forthcoming matches.
Beside each list were columns of squares on which the punter could indicate his forecast
of the result of each match. Some of the lists included all the matches to be played; others
included only a selection of them. The bets varied in character. A great variety of bets was
offered and the odds offered differed widely from 5-2 to 20,000-1. The respondents"
coupon contained 16 lists, each with an appropriate name. The appellants" coupon, which
contained 15 lists, closely resembled the respondents". The lists offered by the appellants
were almost identical with those offered by the respondents in their corresponding lists.
The respondents brought action claiming copyright in the coupons. The House of Lords
was called upon to determine whether or to what extent copyright attached to these
coupons. The respondents said that a coupon must be regarded as a single work and that
as such it was protected by copyright. The appellants sought to dissect the coupon. It was
contended by the respondents that there had been a breach of copyright by the appellants,
since the respondents" compilation, which must be regarded as a single work, was
original and protected by copyright and the part taken by the appellants from the
respondents" work was substantial. It did not follow that because the fragments of the
compilation, taken separately, would not be copyright, the whole could not be copyright.
It was submitted by the appellants that the derivative work of the respondents not being
original, no copyright can be claimed and the inputs put, if considered separately, are of
insignificant value and thus the respondents could not claim copyright. The word
"original" does not mean that the work must be the expression of original or inventive
thought. Copyright Acts are not concerned with the originality of ideas, but with the
expression of thought, and in the case of literary work, with the expression of thought in
print or writing. The originality which is required relates to the expression of the thought.
But the Act does not require that the expression must be in an original or novel form, but
that the work must not be copied from another work - that it should originate from the
author; and as regards compilation, originality is a matter of degree depending on the
amount of skill, judgment or labour that has been involved in making the compilation.
The words "literary work" cover work which is expressed in print or writing irrespective
of the question whether the quality or style is high. The commonplace matter put together
or arranged without the exercise of more than negligible work, labour and skill in making
the selection will not be entitled to copyright.
The word original does not demand original or inventive thought, but only that the work
should not be copied but should originate from the author. In deciding, therefore, whether
a work in the nature of a compilation is original, it is wrong to consider individual parts
of it apart from the whole. For many compilations have nothing original in their parts, yet
the sum total of the compilation may be original. In such cases the courts have looked to
see whether the compilation of the unoriginal material called for work or skill or expense.
If it did, it is entitled to be considered original and to be protected against those who wish
to steal the fruits of the work or skill or expense by copying it without taking the
trouble to
@page-SC833
compile it themselves. In each case, it is a question of degree whether the labour or skill
or ingenuity or expense involved in the compilation is sufficient to warrant a claim to
originality in a compilation.
17. While considering the question whether the copyright protection is available to the
work created as a whole or the fragment of the work would be considered piecemeal and
individually apart from the whole, the House of Lords said as under:
.......One test may be whether the part which he has taken is novel or striking, or is merely
a commonplace arrangement of ordinary words or well-known data. So it may sometimes
be a convenient short-cut to ask whether the part taken could by itself be the subject of
copyright. But, in my view, that is only a short-cut, and the more correct approach is first
to determine whether the plaintiffs work as a whole is "original" and protected by
copyright, and then to inquire whether the part taken by the defendant is substantial.
A wrong result can easily be reached if one begins by dissecting the plaintiffs" work and
asking, could section A be the subject of copyright if it stood by itself, could section B be
protected if it stood by itself, and so on. To my mind, it does not follow that, because the
fragments taken separately would not be copyright, therefore, the whole cannot be. ........"
18. In the case of Walter and Another v. Lane, [1900] AC 539 (HL), the Earl of Rosebery
on five occasions in 1896 and 1898 delivered to the public audience speeches on subjects
of public interest. The Reporter of "The Times" took down the speeches in shorthand,
wrote out their notes, corrected, revised and punctuated them and the reports were
published in "The Times", the speeches being given verbatim as delivered by Lord
Rosebery. The reporters were employed under the terms that the copyright in all reports
and articles composed by "The Time" magazine should belong to the proprietors. In the
year 1899, the respondent published a book called "Appreciations and Addresses: Lord
Rosebery", which contained the reports of the above speeches of Lord Rosebery and it
was admitted that these reports were taken from the reports in "The Times". Lord
Rosebery made no claim. The appellants brought an action against the respondent
claiming a declaration that a copyright of the articles and reports was vested in the
proprietors of "The Times". The issue involved in the case was whether a person who
makes notes of a speech delivered in public, transcribes them and publishes in the
newspaper a verbatim report of the speech, is the author of the report within the meaning
of the Copyright Act, 1842, and is entitled to the copyright in the report. The House of
Lords held that each reporter is entitled to report and each undoubtedly would have a
copyright in his own published report. It was of course open to any other reporter to
compose his own report of Lord Rosebery's speech, and to any other newspaper and book
to publish that report; but it is a sound principle that a man shall not avail himself of
another's skill, labour and expense by copying the written product thereof; and copyright
has nothing to do with the originality or the literary merits of the author or composer. It
may exist in the information given by a street dictionary. If a person chooses to compose
and write a volume devoid of the faintest spark of literary or any other merit, there is no
legal reason why he should not, if he desires, become the first publisher of it and register
his copyright, worthless and insignificant as it would be.
19. In the case of Designers Guild Ltd. v. Russell Williams (Textiles) Ltd., [2000] 1 WLR
2416 (HL), the plaintiff brought proceedings claiming that the defendant had infringed
the plaintiff’s copyright by copying one of its fabric designs, i.e. for the fabric design
Ixia. The infringement of which the plaintiff complained was that for the purpose of
creating its own design Marguerite by the defendant. The defendant had copied a
substantial part of Ixia. There were mainly two main issues at the trial. First, what, if
anything had the designer of Marguerite copied from Ixia. Secondly, did what had been
copied amount to “the whole or a substantial part" of Ixia? It was said by the House of
Lords that the law of copyright rests on a very clear principle that anyone who by his or
her own skill and labour creates an original work of whatever character shall enjoy an
exclusive right to copy that work. No one else may for a season reap what the copyright
owner had sown.
20. University of London Press Limited v. University Tutorial Press Limited, [1916] 2 Ch
601, is perhaps the most cited judgment regarding originality. Originality was
@page-SC834
held to be not required to be novel form but the work should not be copied from other
work, that is, it should be original. The judgment was based on the following facts:
Certain persons were appointed as examiners for matriculation examination of the
University of London on a condition that any copyright in the examination papers should
belong to the University. The University assigned the copyright to the plaintiff company.
After the examination, the defendant company brought out a publication containing a
number of the examination papers, including three which had been set by two examiners
appointed by the University. The plaintiff company brought a case of copyright
infringement against the defendant company. It was argued that since the setting of the
papers entailed the exercise of brainwork, memory, and trained judgment, and even the
selection of passages from other author's work involved careful consideration, discretion
and choice they constituted original literary work. On the other hand, the defendants
claimed that what they had done was fair dealing for the purposes of private study which
was permissible under the law. The court agreed that the material under consideration
was a literary work. The words "literary work" cover work which is expressed in print or
writing, irrespective of the question whether the quality or style is high. The word
"literary" seems to be used in a sense somewhat similar to the use of the word "literature"
in political or electioneering literature and refers to written or printed matter. With respect
to the originality issue, the Court held that the term "original" under the Act does not
imply original or novel form of ideas or inventive thought, but the work must not be
copied from another work - that it should originate from the author.
21. In Kelly v. Morris, (1866) LR 1 Eq 697, School of thought propounded is that, at least
in respect of compilations, only time and expenses are necessary which is "industrious
collection". The plaintiff was the owner and publisher of the first directory. The defendant
came out with another directory. The plaintiff sought an injunction against the defendant
to restrain the publication of the defendant's directory on the allegations that the
defendant was guilty of appropriating the information contained in the plaintiff's
directory and obtained the benefit of many years of incessant labour and expense. The
defendant, on the other hand, contended that there had been no unfair or improper use of
the plaintiff's work. Information which was given in the plaintiff's directory was entitled
to be used and adopted as long as he did not servilely copy it. The defendant had
bestowed his independent time, labour and expense on the matter and thus had in no way
infringed the copyright of the plaintiff. Granting injunction, the Court held that in the
case of a directory when there are certain common objects of information which must, if
described correctly, be described in the same words, a subsequent compiler is bound to
set about doing for himself that which the first compiler has done. In case of a road-book,
he must count the milestones for himself. In the case of a map of a newly discovered
island he must go through the whole process of triangulation just as if he had never seen
any former map, and, generally he is not entitled to take one word of the information
previously published without independently working out the matter for himself, so as to
arrive at the same result from the same common sources of information, and the only use
that he can legitimately make of a previous publication is to verify his own calculations
and results when obtained. The compiler of a directory or guidebook, containing
information derived from sources common to all, which must of necessity be identical in
all cases if correctly given, is not entitled to spare himself the labour and expense of
original inquiry by adopting and re-publishing the information contained in previous
works on the same subject.
22. In the case of Parry v. Moring and Gollancz, Cop Cas (1901-1904) 49, the plaintiff,
after obtaining permission from the representatives of the owner of certain letters,
updated, chronologically arranged and translated them into modern English for their
inclusion in his book. Later, the defendant published, as one of the series, an edition of
the letters prepared by the plaintiff. The plaintiff, therefore, brought an action against the
defendant alleging infringement of his copyright. The plaintiff maintained his copyright
in his version of the text apart from the copyright in the text. It was held that there is
copyright in the work of editing the text of a non-copyright work. The editor of a non-
copyright work is not entitled to take the text from the edition of a rival
@page-SC835
editor and use it as a copy for the purpose of his own work.
23. In Gopal Das v. Jagannath Prasad and Another, AIR 1938 All 266, the plaintiffs were
the printers and publishers of the books. The book titled "Sachitra Bara Kok Shastra" was
printed for the first time in 1928 and had run into four editions since. The defendants
printed and published another book titled "Asli Sachitra Kok Shastra" in 1930. The
plaintiffs case was that the book published by the defendants was a colourable imitation
of their book and an infringement of plaintiffs copyright. It was held by the Court that
the plaintiffs compiled their book with considerable labour from various sources and
digested and arranged the matter taken by them from other authors. The defendant instead
of taking the pains of searching into all the common sources and obtaining his subject-
matter from them, obtained the subject matter from the plaintiffs book and availed
himself of the labour of the plaintiffs and adopted their arrangement and subject-matter
and, thus, such a use of plaintiffs book could not be regarded as legitimate. It was held
that a person whose work is protected by copyright, if he has collected the material with
considerable labour, compiled from various sources of work in itself not original, but
which he has digested and arranged, the defendant could not be permitted to compile his
work of like description, instead of taking the pains of searching into all the common
sources and obtaining the subject-matter from them and to adopt his arrangement with a
slight degree of colourable variation thereby saving pains and labour which the plaintiff
has employed. The act of the defendant would be illegitimate use. The Court held that no
one is entitled to avail himself of the previous labour of another for the purpose of
conveying to the public the same information, although he may append additional
information to that already published.
24. In V. Govindan v. E. M. Gopala-krishna Kone and Another, AIR 1955 Madras 391,
the respondents had published an English-English Tamil Dictionary in 1932. The
appellants were the publishers of similar Dictionary in 1947. An action was brought
regarding the publication and sale of the dictionary by the appellants which was alleged
to be constituting an infringement of the respondents copyright. The lower court went
through both the books minutely and found, page after page, word after word, slavishly
copied, including the errors, and found the sequence, the meanings, the arrangement and
everything else practically the same, except for some deliberate differences introduced
here and there to cover up the piracy". The High Court referred to Copinger and James on
Law of Copyright wherein the law has been neatly summarized that : In the case of
compilations such as dictionaries, gazetteers, grammars, maps, arithmetics, almanacs,
encyclopaedias and guide books, new publications dealing with similar subject-matter
must of necessity resemble existing publications, and the defence of common source is
frequently made where the new publication is alleged to constitute an infringement of an
earlier one". The Court held that in law books and in books as mentioned above there is
very little amount of originality but the same is protected by law and no man is entitled to
steal or appropriate for himself the result of another's brain, skill or labour even in such
works". The Court further clarified that where there is a "common source", the person
relying on it must prove that he actually went to the common source from where he
borrowed, employing his own skill, labour and brains and that he did not merely copy.
25. In C. Cunniah and Co. v Balraj and Co., AIR 1961 Madras 111, the appellant firm
was carrying on the business in pictures, picture frames, etc. One Sri T.M. Subramaniam
drew a picture of Lord Balasubramanya and gave it the title of Mayurapriya and a
copyright was assigned to the appellant. It came to the knowledge of the appellant firm
that the respondent firm was printing and selling copies of a close and colourable
imitation of the appellant's picture under the style of Bala Murugan. The case of the
defence was that their picture was an independent production and that the appellant had
not acquired copyright in the picture and the subject dealt with in that picture was a
common subject, in which no copyright could be acquired by anyone. The Court held that
in order to obtain copyright production for literary, domestic, musical and artistic works,
the subject dealt with need not to be original, nor the ideas expressed be something novel.
What is required is the expenditure of original skill or labour in execution and not
originality of thought.
26. In Agarwala Publishing House v.
@page-SC836
Board of High School and Intermediate Education and Another, AIR 1967 All 91, a writ
petition was filed by a publisher firm challenging an amendment of the Regulations of the
Board declaring that copyright of the question papers set at all examinations conducted
by the Board shall vest in the Board and forbidding the publication of such question
papers without the Board's permission. The question involved in the case was whether the
question papers are "original literary work" and come within the purview of Section 13 of
the Copyright Act, 1957. It was urged that no copyright can exist in examination papers
because they are not "original literary work". It was held that the "original literary
works" referred to in Section 13 of the Copyright Act, 1957, are not confined to the
works of literature as commonly understood. It would include all works expressed in
writing, whether they have any literary merits or not. This is clear from the definition
given in Section 2(o) of the Act which states that literary work includes tables and
compilations. The Court further held that the word "original" used in Section 13 does not
imply any originality of ideas but merely means that the work in question should not be
copied from some other work but should originate in the author, being the product of his
labour and skill.
27. In the case of Gangavishnu Shrikisondas v. Moreshvar Bapuji Hegishte and Others,
ILR 13 Bom 358, the plaintiff, a book seller, in 1984 brought out a new and annotated
edition of a certain well-known Sanskrit work on religious observances entitled "Vrtraj",
having for that purpose obtained the assistance of the pandits, who re-cast and re-
arranged the work, introduced various passages from other old Sanskrit books on the
same subject and added footnotes. Later on, the defendant printed and published an
edition of the same work, the text of which is identical with that of the plaintiff's work,
which moreover contained the same additional pages and the same footnotes, at the same
places, with many slight differences. The foundation of both plaintiff's and defendant's
books is an old Sanskrit work on Hindu ceremonial, which could have been published by
anyone. The copyright claimed by the plaintiff was on the additions and alterations to the
original text, which the parties admit to be material and valuable, and in which the
copyright is claimed of its prior publication. The defendants argued that there was
nothing really original in the plaintiff’s book and, therefore, he was not entitled to
copyright in the book. It was held by the Court that a new arrangement of old matters will
give a right to the protection afforded by the law of copyright. If anyone by pains and
labour collects and reduces it as a systematic compilation in the form of a book it is
original in the sense that that entitles the plaintiff to the copyright. The plaintiff worked
for such a new arrangement of old matters as to be an original work and was entitled to
the protection; and that as the defendants had not gone to independent sources of the
material but had pirated the plaintiff's work, they were restrained by injunction.
28. In Rai Toys Industries and Others v. Munir Printing Press, 1982 PTC 85, the plaintiff
had published a Tambola ticket book containing 1500 different tickets in 1929. The
plaintiffs alleged that the defendants had brought out another ticket book which the
plaintiffs claimed to have written in 1929 and registered as copyright. The ticket book
brought out by the defendants was alleged to contain 600 different tickets and the same
had been copied identically from the books of the plaintiff. On this basis, a suit for
injunction and rendition of account was filed by the plaintiff. The question before the
court was whether the ticket-books in the form of tables constitute literary work; and
whether copyright has been violated or not? It was held by the High Court that
preparation of tickets and placing them in tables required a good deal of skill and labour
and would thus satisfy the test of being original literary work. It was recognized that the
arrangement of numbers is individual work of a person who prepares it; it bears his
individuality and long hours of labour. It is not information which could be picked up by
all and sundry. The preparation of tickets is an individualized contribution and the
compilation eminently satisfies the test of being an original literary work. Hence it was
held to be a clear case of copyright violation when the defendant decided to pick and
choose 600 tables on the sly and publish them as his individual work.
29. In Macmillan and Another v. Suresh Chandra Deb, ILR 17 Cal 952, the plaintiffs
were proprietors of the copyright of a selection of songs and poems composed by various
authors, which was published in 1861. In 1889, the defendants published a book
@page-SC837
containing same selection of poems and songs as was contained in plaintiffs book, the
arrangement, however, being different. The plaintiffs claimed copyright in the selection
made by them. The defendants, on the other hand, contended that there could be no
copyright in such selection. The Court held that in the case of works not original in the
proper sense of the term, but composed of, or compiled or prepared from material which
are open to all, the fact that one man has produced such a work does not take away from
any one else the right to produce another work of the same kind, and in doing so to use all
the materials open to him. But, as the law is concisely stated by Hall, V.C., in Hogg v
Scott, L.R. 18 Eq. 444, "the true principle in all these cases is, that the defendant is not at
liberty to use or avail himself of the labour which the plaintiff has been at for the purpose
of producing his work, that is, in fact, merely to take away the result of another man's
labour, or, in other words, his property". It is enough to say that this principle has been
applied to maps, to road books, to guide books, to compilations on scientific and other
subjects. This principle seems to be clearly applicable to the case of a selection of a
poem. It was held that for such a selection as the plaintiff had made obviously required
extensive reading, careful studying and comparison and the exercise of taste and
judgment to make a selection for himself. But, if one spares himself this trouble and
adopts some other person's selection, he offends against the principle. The Court was of
the opinion that the selection of poems made by the plaintiff and embodied in the Golden
Treasury was the subject of copyright and that the defendant's book had infringed that
right.
30. These decisions are the authority on the proposition that the work that has been
originated from an author and is more than a mere copy of the original work, would be
sufficient to generate copyright. This approach is consistent with the "sweat of the brow"
standards of originality. The creation of the work which has resulted from little bit of
skill, labour and capital are sufficient for a copyright in derivative work of an author.
Decisions propounded a theory that an author deserves to have his or her efforts in
producing a work, rewarded. The work of an author need not be in an original form or
novel form, but it should not be copied from another's work, that is, it should originate
from the author. The originality requirement in derivative work is that it should originate
from the author by application of substantial degree of skill, industry or experience.
Precondition to copyright is that work must be produced independently and not copied
from another person. Where a compilation is produced from the original work, the
compilation is more than simply a re-arranged copyright of original, which is often
referred to as skill, judgment and or labour or capital. The copyright has nothing to do
with originality or literary merit. Copyrighted material is that what is created by the
author by his skill, labour and investment of capital, may be it is derivative work. The
courts have only to evaluate whether derivative work is not the end-product of skill,
labour and capital which is trivial or negligible but substantial. The courts need not go
into evaluation of literary merit of derivative work or creativity aspect of the same.
31. Mr. P. N. Lekhi, learned senior counsel appearing for the respondents in C.A. No.
6472/2004 has submitted that the judgment of the court is a government work as defined
under Section 2(k)(iii) and on account of Section 17 (d), the Government in the absence
of any agreement to the contrary be the first owner of the copyright therein. Section
52(1)(q)(iv) provides that the publication of any judgment or order of a court, tribunal or
other judicial authority, unless the reproduction of publication of such judgment or order
is prohibited, would not constitute an infringement of the copyright. Therefore,
publication of the judgments of the apex court by the respondents would not tantamount
to infringement of the copyright of the appellants. It is further urged that the judgments
published in the Supreme Court Cases is nothing but merely a derivative work based
upon the judgments of the court, which lacks originality as it does not depict independent
creation even a modicum of creativity. The inputs put by the appellants is nothing but
expressing an idea which can be expressed in a limited way and as such there cannot be a
copyright. Filling the blanks or gaps by providing names of the parties or citations of the
judgments, both of which are well known and unchangeable parts of that idea, are not
original work. These are not creative at all to warrant copyright protection, either singly
or in combination. The additions made in the reported
@page-SC838
judgment by the editors of the Supreme Court Cases are only the well known extensions
of the reported decision. These extensions lack even the minimal degree of author's
creativity or originality or intellectual labour. These additions do not create additional
knowledge, the protection of which is the very basis of the copyright protection.
32. It is submitted by Ms. Pratibha M. Singh, learned counsel for the respondents in C.A.
No. 6905/2004, that in the present case, the journals of the appellants, including SCC, are
printed and published on the basis of pre-existing judgments. Journals are, therefore, a
derivative work. There is a distinction between a "law report" as understood in England
and a "law journal" as printed in India. The appellants" journal" SCC is not a law report
in the strict sense, inasmuch as the appellants journal reproduces the judgments of the
court verbatim along with inputs. However, a law report known in the traditional English
sense is when a law reporter present in the court would record in his own words and
language the arguments of the counsel on both sides, give a summary of the facts and
incorporate into the said report his transcript of the speech of the Judge. Thus, the
appellants work could only be a law journal and not a law report. The judgments were
specifically made a part of the exception to copyright infringement and thus find place in
Section 52(1)(q) of the Act. The underlying purpose is that it is in public interest to place
judgments in public domain. The work for which the copyright protection is claimed is a
derivative work. For claiming protection of copyright in a derivative work, under the
Indian law originality is a pre-condition and originality means only that the work was
independently created by the author as opposed to copied from other works, and that it
possesses at least some minimal degree of creativity. There is a distinction between
creation and discovery. The first person to find a particular fact has not created the fact,
he or she has merely discovered its existence. Reporting of the judgments of the Supreme
Court with certain inputs could only be said to be a discovery of facts already in
existence. Though for the purposes of creativity neither novelty nor invention is requisite
for copyright protection, but at least some minimal creativity is a must. To create a
copyright by alterations of the text, these must be extensive and substantial practically
making a new version. The English decisions relied upon by the appellants would not
apply to the facts of the present case as all the said authorities are under the old 1842 Act
in U.K. wherein the word original was conspicuously missing in the statute. It is further
urged that the copy-editing inputs of the appellants are only discoveries/facts and there
are limited ways/unique of expressing the various copy-editing inputs and thus no
copyright can subsist in such limited/unique expressions. The facts which are discovered
could be expressed in limited ways and as such ways adopted cannot give copyright
protection to the inputs or the judgments as a whole. It is urged that recognizing the
copyright in the copy-edited version of the law reports would amount to giving the
appellants a monopoly in the judgments of the courts which is against the intendment of
Section 52(1)(q)(iv) and would defeat the purpose of putting judgments in the public
domain. It is submitted by the learned counsel for the respondents that for a derivative
work, the originality test as applied in United States Supreme Court should be made
applicable whereby the author of a derivative work would satisfy that the work has been
produced from his exercise of skill and judgment. The exercise of skill and judgment
required to produce the work must not be so trivial that it could be characterized a purely
mechanical exercise. The work should be independently created by the author as opposed
to copied from the other works and that it possesses at least some minimal degree of
creativity. The case law relied upon by the learned counsel for the respondents is
considered hereinafter.
33. In Feist Publications Inc. v. Rural Telephone Service Co. Inc., 18 USPQ 2d 1275,
Rural Telephone Service Co. publishes a typical telephone directory consisting of white
pages and yellow pages. The white pages list in alphabetical order the names of rural
subscribers together with their towns and telephone numbers. The yellow pages list
Rurals business subscribers alphabetically by category and feature classified
advertisements of various sizes. To obtain white pages listings for its area-wide directory,
Feist Publications Inc. approached different telephone companies operating in North West
Kansas and offered to pay for the right to use their white pages listings.
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of them, only Rural refused. Unable to license Rurals white pages listings, Feist used
them without Rural's consent. Rural sued for copyright infringement in the District Court
taking the position that Feist, in compiling its own directory, could not use the
information contained in Rural's white pages. Rural asserted that Feist's employees were
obliged to travel door to door or conduct a telephone survey to discover the same
information for themselves. Feist responded that such efforts were economically
impractical and, in any event, unnecessary because the information copied was beyond
the scope of copyright protection. The United States Supreme Court held that the sine
qua non of copyright is originality. To qualify for copyright protection, a work must be
original to the author. Original, as the term is used in copyright, means only that the work
was independently created by the author (as opposed to copied from other works), and
that it possesses at least some minimal degree of creativity. The requisite level of
creativity is extremely low; even a slight amount will suffice. The vast majority of works
make the grade quite easily, as they possess some creative spark, no matter how crude,
humble or obvious it might be. Originality does not signify novelty; a work may be
original even though it closely resembles other works so long as the similarity is
fortuitous, not the result of copying. The Court further held that no one claim originality
as to the facts. This is because facts do not owe their origin to an act of authorship. The
distinction is one between creation and discovery: the first person to find and report a
particular fact has not created the fact; he or she has merely discovered its existence.
Factual compilations, on the other hand, may possess the requisite originality. The
compilation author typically chooses which facts to include, in what order to place them,
and how to arrange the collected data so that they may be used effectively by readers.
These choices as to selection and arrangement, so long as they are made independently
by the compiler and entail a minimal degree of creativity, are sufficiently original. Thus,
if the compilation author clothes facts with an original collocation of words, he or she
may be able to claim a copyright in this written expression. The Court goes on to hold
that the primary objective of copyright is not to reward the labour of authors, but to
promote the progress of science and useful arts. To this end, copyright assures authors the
right to their original expression but encourages others to build freely upon the ideas and
information conveyed by a work. Only the compiler's selection and arrangement may be
protected; however, the raw facts may be copied at will. The Court rejected the doctrine
of the "sweat of the brow" as this doctrine had numerous flaws, the most glaring being
that it extended copyright protection in a compilation beyond selection and arrangement -
the compiler's original contributions - to the facts themselves. A subsequent compiler was
not entitled to take one word of information previously published, but rather had to
independently work out the matter for himself, so as to arrive at the same result from the
same common sources of information. "Sweat of the brow" courts thereby eschewed the
most fundamental axiom of copyright law that no one may copyright facts or ideas. The
"sweat of the brow" doctrine flouted basic copyright principles and it creates a monopoly
in public domain materials without the necessary justification of protecting and
encouraging the creation of writings by authors.
34. The judgment in Matthew Bender and Co., Inc. v. West Publishing Co., 158 F.3d 674
(2nd Cir. 1998), is of United States Court of Appeals, Second Circuit, which directly
covers the reports of the judgments of the courts. The facts involved in the case are that
the West Publishing Co. and West Publishing Corp. ("West") obtain the text of judicial
opinions directly from courts. It alters these texts into (i) independently composed
features, such as syllabus, headnotes which summarize the specific points of law recited
in each opinion and key numbers which categorize points of law into different legal
topics and sub-topics and (ii) additions of certain factual information to the text of the
opinions, including parallel or alternative citations to cases, attorney information, and
data on subsequent procedural history. West publishes the case reports in different series
of case reporters collectively known as "National Reporter System". Two series of case
reporters at issue in that case were the Supreme Court Reporter and the Federal Reporter.
HyperLaw publishes and markets CD-ROMs which are compilations of the Supreme
Court and the United States Court of Appeals that cover approximately the same ground.
HyperLaw intends to expand
@page-SC840
its CD-ROM product taking the material from the West publications. HyperLaw
intervened and sought a judgment declaring that the individual West case reports that are
left after redaction of the first category of alterations do not contain copyrightable
material. It was held by the Court that for copyright protection, the material does not
require novelty or invention, but minimal creativity is required. All of West's alterations
to judicial opinions involve the addition and arrangement of facts, or the rearrangement
of data already included in the opinions, and, therefore, any creativity in these elements
of West's case reports lies in West's selection and arrangement of this information. West's
choices on selection and arrangement can reasonably be viewed as obvious, typical and
lacking even minimal creativity. Copyright protection is unavailable for both derivative
works and compilations alike unless, when analysed as a whole, they display sufficient
originality so as to amount to an original work of authorship. Originality requires only
that the author makes the selection or arrangement independently and that it displays
some material with minimal level of creativity. While a copy of something in the public
domain will not, if it be merely a copy, support a copyright, a distinguishable variation
will. To support a copyright there must be at least some substantial variation, not merely a
trivial variation such as might occur in the translation to a different medium. Creativity in
selection and arrangement, therefore, is a function of (i) the total number of options
available, (ii) external factors that limit the viability of certain options and render others
non-creative, and (iii) prior uses that render certain selections "garden variety".
35. In the case of Key Publications, Inc. v. Chinatown Today Publishing Enterprises, Inc.,
945 F 2d 509, Key Publication published an Annual Classified Business Directory for
New York City's Chinese-American community. In 1990, Galore Publication published
the Galore Directory, a classified directory for the New York Chinese American
community. Key brought a suit against Galore Directory charging that Galore Directory
infringed Key's copyright in the 1989-90 Key Directory. The United States Court of
Appeal held that individual components of compilation are generally within the public
domain and thus available for public. There are three requirements for a compilation to
qualify for copyright protection : (1) the collection and assembly of pre-existing data; (2)
selection, co-ordination or arrangement of the data; and (3) the resulting work that comes
into being is original, by virtue of the selection, co-ordination or arrangement of the data
contained in the work. For originality, the work is not required to contain novelty. The
doctrine of "sweat of the brow", rewarded compilers for their efforts in collecting facts
with a de facto copyright to those facts and this doctrine would prevent, preclude the
author absolutely from saving time and effort by referring to and relying upon prior
published material. It extended copyright protection in compilation beyond selection and
arrangement - the compiler's original contribution - to the facts themselves drawn on
"sweat of the brow" is a copyright protection to the facts discovered by the compiler. The
court discarded "sweat of the brow" notion of copyright law.
36. In Macmillan and Company v. K. and J. Cooper, 1924 Privy Council 75, action was
brought by McMillan and Company to restrain the respondent-firm who was carrying on
the trade and business of publishers of educational books, from printing, distributing or
otherwise disposing of copies of the book published by the appellants. The ground on
which the relief was claimed was that the appellants had a copyright in the book entitled
Plutarch's Life of Alexander, Sir Thomas North's Translation and that the respondent
published subsequently a book entitled Plutarch's Life of Alexander the Great, North's
Translation", as it had infringed the copyright to which the appellants were entitled in the
earlier compilation. The Court noted the contents of the book of the appellants as also
that of the respondent. As per the Court, the text of the appellants book consisted of a
number of detached passages, selected from Sir Thomas North's translation, words being
in some instances introduced to knit the passages together so that the text should as far as
possible, present the form of an unbroken narrative. The passages so selected were, in the
original translation, by no means contiguous. Considerable printed matter in many
instances separated the one from the other. The opinion of the Privy Council was that for
the work done by the appellants, great knowledge, sound judgment, literary skill or taste
in the inputs brought to bear upon the
@page-SC841
translation was not required, as the passages of the translation which had been selected
are reprinted in their original form, not condensed, expanded, modified or reshaped to
any extent whatever. The Court observed that the North's translation of Plutarch's Life of
Alexander does not and never did, as the law stands, never can enjoy the protection of
copyright; and the questions which arise for decision must be dealt with upon that
assumption. The Court said that in all cases where the reprint with the text of it consisted
merely of a reprint of passages selected from the work of any author, would never have a
copyright. There may be cases where selecting and reprinting the passages would require
the appreciation upon what has been laid down or established in the book and labour,
accurate scientific knowledge, sound judgment, touching the purpose for which the
selection is made, and literary skill would all be needed to effect the object in view. In
such a case, the copyright might well be acquired for the print of the selected passages.
The Court said that it is the product of the labour, skill and capital of one man which must
not be appropriated by another, not the elements, the raw material, upon which the labour
and skill and capital of the first have been expended. To secure copyright for this product,
it is necessary that the labour, skill and capital expended should be sufficient to impart to
the product some quality or character which the raw material did not possess and which
differentiates the product from the raw material. The Court approved the principles
enunciated in the case of University of London Press, Ltd. v. University Tutorial Press,
Ltd., [1916] 2 Ch. 601, dealing with the meaning of the words "original literary work"
that the original does not mean expression of original or inventive thought. The
Copyright Act is not concerned with the original ideas, but with the expression of
thought. The originality which is required relates to expression of thought and the Act
does not require that the expression must be in original or novel form. The work must not
be copied from another - work that it should originate from the author.
37. The Supreme Court of Canada in the matter of CCH Canadian Ltd. v. Law Society of
Upper Canada, 2004 (1) SCR 339 (Canada) has noticed the competing views on the
meaning of "original" in copyright law wherein some courts have held that a work which
has originated from an author and is more than a mere copy of a work, is sufficient to
give copyright. This approach is held to be consistent with the "sweat of the brow" or
"industriousness" standard of originality on the premise that an author deserves to have
his or her efforts in producing a work rewarded. Whereas the other courts have held that a
work must be creative to be original and thus protected by the copyright Act, which
approach is consistent with a natural rights theory of property law; however, it is less
absolute in that only those works that are the product of creativity will be rewarded with
copyright protection and it was suggested in those decisions that the creativity approach
to originality helps ensure that copyright protection is extended to the expression of ideas
as opposed to the underlying ideas or facts. The Court has also noticed that those cases
which had adopted the sweat of the brow approach to originality should not be interpreted
as concluding that labour, in and of itself, would be a ground for finding of originality.
The question for consideration of the copyright has arisen on the following fact
foundation. The appellant, Law Society of Upper Canada, has maintained and operated
the Great Library at Osgoode Hall in Toranto, a reference and research library. The Great
Library provides a request-based photocopy service for Law Society members, the
judiciary and other authorized researchers. Under the custom photocopy service, legal
materials are reproduced and delivered to the requesters. The Law Society also maintains
self-service photocopiers in the Great Library for use by its patrons. The respondents,
CCH Canadian Ltd., Thomson Canada Ltd. and Canada Law Book Inc. publish law
reports and other legal materials. The law book publishers commenced copyright
infringement action against the Law Society claiming ownership of copyright in 11
specific works on the ground that the Law Society had infringed copyright when the
Great Library reproduced a copy of each of the works. The publishers further sought
permanent injunction prohibiting the Law Society from reproducing these 11 works as
well as any other works that they published. The Law Society denied liability and
submitted that the copyright is not infringed when a single copy of a reported decision,
case summary, statute, regulation or a limited selection of text from a treatise is made by
the Great Library staff
@page-SC842
or one of its patrons on a self-service photocopier for the purpose of research. The Court
was called upon to decide the question as to what shall be the originality in the work of
compilation. On consideration of various cases, it was held that to be original under the
Copyright Act the work must originate from an author, not be copied from another work,
and must be the product of an authors exercise of skill and judgment. The exercise of skill
and judgment required to produce the work must not be so trivial that it could be
characterized as a purely mechanical exercise. Creative works by definition are original
and are protected by copyright, but creativity is not required in order to render a work
original. The original work should be the product of an exercise of skill and judgment and
it is a workable yet fair standard. The sweat of the brow approach to originality is too low
a standard which shifts the balance of copyright protection too far in favour of the
owner’s right, and fails to allow copyright to protect the publics interest in maximizing
the production and dissemination of intellectual works. On the other hand, the creativity
standard of originality is too high. A creative standard implies that something must be
novel or non-obvious - concepts more properly associated with patent law than copyright
law. By way of contrast, a standard requiring the exercise of skill and judgment in the
production of a work avoids these difficulties and provides a workable and appropriate
standard for copyright protection that is consistent with the policy of the objectives of the
Copyright Act. Thus, the Canadian Supreme Court is of the view that to claim copyright
in a compilation, the author must produce a material with exercise of his skill and
judgment which may not be creativity in the sense that it is not novel or non-obvious, but
at the same time it is not the product of merely labour and capital.
38. It is the admitted position that the reports in the Supreme Court Cases (SCC) of the
judgments of the Supreme Court is a derivative work in public domain. By virtue of
Section 52(1) of the Act, it is expressly provided that certain acts enumerated therein
shall not constitute an infringement of copyright. Sub-clause (iv) of clause (q) of Section
52(1) excludes the reproduction or publication of any judgment or order of a Court,
Tribunal or other judicial authority, unless the reproduction or publication of such
judgment or order is prohibited by the Court, the Tribunal or other judicial authority from
copyright. The judicial pronouncements of the Apex Court would be in the public domain
and its reproduction or publication would not infringe the copyright. That being the
position, the copy-edited judgments would not satisfy the copyright merely by
establishing amount of skill, labour and capital put in the inputs of the copy-edited
judgments and the original or innovative thoughts for the creativity are completely
excluded. Accordingly, original or innovative thoughts are necessary to establish
copyright in the author’s work. The principle where there is common source the person
relying on it must prove that he actually went to the common source from where he
borrowed the material, employing his own skill, labour and brain and he did not copy,
would not apply to the judgments of the courts because there is no copyright in the
judgments of the court, unless so made by the court itself. To secure a copyright for the
judgments delivered by the court, it is necessary that the labour, skill and capital invested
should be sufficient to communicate or impart to the judgment printed in SCC some
quality or character which the original judgment does not possess and which
differentiates the original judgment from the printed one. The Copyright Act is not
concerned with the original idea but with the expression of thought. Copyright has
nothing to do with originality or literary merit. Copyrighted material is that what is
created by the author by his own skill, labour and investment of capital, may be it is a
derivative work which gives a flavour of creativity. The copyright work which comes into
being should be original in the sense that by virtue of selection, co-ordination or
arrangement of pre-existing data contained in the work, a work somewhat different in
character is produced by the author. On the face of the provisions of the Indian Copyright
Act, 1957, we think that the principle laid down by the Canadian Court would be
applicable in copyright of the judgments of the Apex Court. We make it clear that the
decision of ours would be confined to the judgments of the courts which are in the public
domain as by virtue of Section 52 of the Act there is no copyright in the original text of
the judgments. To claim copyright in a compilation, the author must produce the material
with
@page-SC843
exercise of his skill and judgment which may not be creativity in the sense that it is novel
or non-obvious, but at the same time it is not a product of merely labour and capital. The
derivative work produced by the author must have some distinguishable features and
flavour to raw text of the judgments delivered by the Court. The trivial variation or inputs
put in the judgment would not satisfy the test of copyright of an author.
39. On this touchstone, we shall take into consideration the inputs put by the appellants in
their journal "SCC". The appellants have added in the copy-edited version the cross-
citations to the citation(s) already given in the original text; added names of cases and
cross-citations where only the citation of the case is given; added citation and cross-
citations where only name of the case is given; inserted citation in case history where
only the title and year of the impugned/earlier order is given; presented in their own style
the cases when they are cited repeated in the judgment; provided precise references to the
quoted matter in the judgment by giving exact page and paragraph number as in the
original case source/treatise/reference material; added margin headings to quoted extracts
from statutes/rules, etc., when they are missing from the original text of the judgment;
added the number of the Section/Rule/Article/paragraph to the extract quoted in the
original text; added the names of Judges on whose behalf opinion given by giving
expressions such as "for himself and Pathak, C.J." etc.; done verification of first word of
the quoted extract and supplied emphasis on such verification; added ellipsis "...." to
indicate breaks in quoted extract; provided and supplied the matter inadvertently missed
in quoted extracts in the original text of the judgment; completed/corrected the
incomplete/incorrect case names or citations; renumbered correctly the clauses/sub-
clauses in terms of the questions framed which were numbered in terms of answers to
questions framed by learned Judge; changed the text as per corrigenda issued, which has
been issued upon SCC Editors request and suggestions; done compressing/simplification
of information relating to the case history; followed certain norms at SCC for giving case
names; omitted the words like "Section", "Sec.", "Rule", etc. and given only the number
of the Section/rule at the beginning of the quoted extract; made margin heading and the
first clause/sub-section or initial matter of section/rule etc. to run-on instead of being let
to start from a fresh line; done compressing of unquoted referends and use of *** for
parts; replaced the series of dots in the raw text with ellipsis; removed abbreviations such
as sec., R., cl. and substituted them with full word, i.e. Section, Rule, clause; added
hyphenation after the section/rule numbers which have alphabets suffixed to them;
applied indentation of quoted extracts; removed full stops or word "No." ; and given full
forms of abbreviations to enhance readability and clarity. In addition to the above,
capitalization and italicization is also made wherever necessary in the raw text; and
punctuation, articles, spellings and compound words are also checked and corrected, if
required, in the original text.
40. The aforesaid inputs put by the appellants in the judgments would have had a
copyright had we accepted the principle that any one who by his or her own skill and
labour creates an original work of whatever character, shall enjoy an exclusive right to
copy that work and no one else would be permitted to reap the crop what the copyright
owner had sown. No doubt the appellants have collected the material and improved the
readability of the judgment by putting inputs in the original text of the judgment by
considerable labour and arranged it in their own style, but that does not give the flavour
of minimum requirement of creativity. The exercise of the skill and judgment required to
produce the work is trivial and is on account of the labour and the capital invested and
could be characterized as purely a work which has been brought about by putting some
amount of labour by the appellants. Although for establishing a copyright, the creativity
standard applies is not that something must be novel or non-obvious, but some amount of
creativity in the work to claim a copyright is required. It does require a minimal degree
of creativity. Arrangement of the facts or data or the case law is already included in the
judgment of the court. Therefore, creativity of SCC would only be addition of certain
facts or material already published, case law published in another law report and its own
arrangement and presentation of the judgment of the court in its own style to make it
more user- friendly. The selection and arrangement can be viewed as typical and at best
result of the labour, skill and investment of capital
@page-SC844
lacking even minimal creativity. It does not as a whole display sufficient originality so as
to amount to an original work of the author. To support copyright, there must be some
substantive variation and not merely a trivial variation, not the variation of the type where
limited ways/unique of expression available and an author selects one of them which can
be said to be a garden variety. Novelty or invention or innovative idea is not the
requirement for protection of copyright but it does require minimal degree of creativity.
In our view, the aforesaid inputs put by the appellants in the copy-edited judgments do
not touch the standard of creativity required for the copyright.
41. However, the inputs put in the original text by the appellants in (i) segregating the
existing paragraphs in the original text by breaking them into separate paragraphs; (ii)
adding internal paragraph numbering within a judgment after providing uniform
paragraph numbering to the multiple judgments; and (iii) indicating in the judgment the
Judges who have dissented or concurred by introducing the phrases like "concurring",
"partly concurring", "partly dissenting", "dissenting", "supplementing", "majority
expressing no opinion", etc., have to be viewed in a different light. The task of paragraph
numbering and internal referencing requires skill and judgment in great measure. The
editor who inserts para numbering must know how legal argumentation and legal
discourse is conducted and how a judgment of a court of law must read. Often legal
arguments or conclusions are either clubbed into one paragraph in the original judgment
or parts of the same argument are given in separate paragraphs. It requires judgment and
the capacity for discernment for determining whether to carve out a separate paragraph
from an existing paragraph in the original judgment or to club together separate
paragraphs in the original judgment of the court. Setting of paragraphs by the appellants
of their own in the judgment entailed the exercise of the brain work, reading and
understanding of subject of disputes, different issues involved, statutory provisions
applicable and interpretation of the same and then dividing them in different paragraphs
so that chain of thoughts and process of statement of facts and the application of law
relevant to the topic discussed is not disturbed, would require full understanding of the
entire subject of the judgment. Making paragraphs in a judgment could not be called a
mechanical process. It requires careful consideration, discernment and choice and thus it
can be called as a work of an author. Creation of paragraphs would obviously require
extensive reading, careful study of subject and the exercise of judgment to make
paragraph which has dealt with particular aspect of the case, and separating intermixing
of a different subject. Creation of paragraphs by separating them from the passage would
require knowledge, sound judgment and legal skill. In our opinion, this exercise and
creation thereof has a flavour of minimum amount of creativity. The said principle would
also apply when the editor has put an input whereby different Judges opinion has been
shown to have been dissenting or partly dissenting or concurring, etc. It also requires
reading of the whole judgment and understanding the questions involved and thereafter
finding out whether the Judges have disagreed or have the dissenting opinion or they are
partially disagreeing and partially agreeing to the view on a particular law point or even
on facts. In these inputs put in by the appellants in the judgments reported in SCC, the
appellants have a copyright and nobody is permitted to utilize the same.
42. For the reasons stated in the aforesaid discussion, the appeals are partly allowed. The
High Court has already granted interim relief to the plaintiff-appellants by directing that
though the respondent-defendants shall be entitled to sell their CD-ROMS with the text
of the judgments of the Supreme Court along with their own head notes, editorial notes, if
any, they should not in any way copy the head notes of the plaintiff-appellants; and that
the defendant-respondents shall also not copy the footnotes and editorial notes appearing
in the journal of the plaintiff-appellants. It is further directed by us that the defendant-
respondents shall not use the paragraphs made by the appellants in their copy-edited
version for internal references and their editors judgment regarding the opinions
expressed by the Judges by using phrases like "concurring", "partly dissenting", etc. on
the basis of reported judgments in SCC. The judgment of the High Court is modified to
the extent that in addition to the interim relief already granted by the High Court, we have
granted the above-mentioned additional relief to the appellants.
@page-SC845
43. In view of the decision rendered by us in the civil appeals, we do not think it
necessary to pass any order on the contempt petition. The contempt petition stands
disposed of accordingly.
44.There shall be no order as to costs.
Order accordingly.
AIR 2008 SUPREME COURT 845 "National Insurance Co. Ltd. v. Indira Srivastava"
(From : 2007 (6) ALJ (DOC) 300 : 2007 (3) All WC 2605)
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Civil Appeal No. 5830 of 2007 (arising out of SLP (C) No. 14452 of 2007) D/- 12 -12
-2007.
National Insurance Co. Ltd. v. Indira Srivastava and Ors.
Motor Vehicles Act (59 of 1988), S.168 - MOTOR VEHICLES - Accident compensation
- "Income" of victim - Not only pay packet but perks which are beneficial to his family -
Must be considered.
2004 ACC 533 (SC), Held Per incuriam.
Section 168 uses the word ‘just compensation" which should be assigned a broad
meaning. The term "income" has different connotations for different purposes. A Court of
law, having regard to the change in societal conditions must consider the question not
only having regard to pay packet the employee carries home at the end of the month but
also other perks which are beneficial to the members of the entire family. In determining
what constitutes income it cannot be lost sight that the private sector companies in place
of introducing a pension scheme takes recourse to payment of contributory Provident
Fund, Gratuity and other perks to attract the people who are efficient and hard working.
Different offers made to an officer by the employer, same may be either for the benefit of
the employee himself or for the benefit of the entire family. If some facilities are being
provided whereby the entire family stands to benefit, the same, must be held to be
relevant for the purpose of computation of total income on the basis whereof the amount
of compensation payable for the death of the kith and kin of the applicants is required to
be determined. 2004 ACC 533 held per incuriam. (Paras 8, 9)
The amounts, which were required to be paid to the deceased by his employer by way of
perks, should be included for computation of his monthly income as that would have
been added to his monthly income by way of contribution to the family as
contradistinguished to the ones which were for his benefit. (Para 17)
Cases Referred : Chronological Paras
2007 AIR SCW 1316 : AIR 2007 SC 1243 : 2007 (2) ALJ 766 (Ref.) 22
2007 AIHC 1921 (Mad) (Approved) 13
2005 AIR SCW 1801 : AIR 2005 SC 2157 22
2005 AIR SCW 2542 : AIR 2005 SC 2985 (Ref.) 21
2004 (1) ACC 533 (SC) (Held per Incuriam) 15, 16
AIR 2002 (NOC) 211 : 2002 AIHC 2633 (AP) (Approved) 14
2001 AIR SCW 1074 : AIR 2001 SC 1333 16
(1999)1 TAC 8497 (MP) 3
1998 AIR SCW 3105 : AIR 1998 SC 3191 14
AIR 1979 SC 1666 14
AIR 1985 SC 106 (Rel. on) 20
AIR 1930 Mad 626 18
AIR 1921 Mad 427 (SB) 18
51 LJ Ch 938 18
42 LJ Ch 336 18
Joy Basu, B. K. Satija, for Appellant; L. N. Rao, Sr. Advocate (A. C.) for Respondent,
Ms. Indira Srivastava, Caveator in person.
Judgement
S. B. SINHA, J. :- Leave granted.
2. Connotation of the term "income" for the purpose of determination of just
compensation envisaged under Section 168 of the Motor Vehicles Act, 1988 (the Act)
calls for question in this appeal which arises out of a judgment and order dated 6.4.2007
passed by the High Court of Judicature at Allahabad, Lucknow Bench at Lucknow in
FAFO No.171 of 2001. Respondent's husband R.K. Srivastava was employed in a
company named Gabriel India Ltd. While he was travelling in an auto rickshaw from
Charbagh Railway Station, Lucknow to his residence situated at Ashok Marg, the same
met with an accident with a Mahindra Commander Jeep driven rashly and negligently. He
sustained injuries and ultimately succumbed thereto. Respondents herein filed a claim
petition before the learned Tribunal. A salary certificate was produced in the said
proceedings which is in the following terms:
@page-SC846

Earnings Amount Deductions Amount


Basic 3420.00 CPF(S) 488.00
Special Pay 70.00 CPF (Add)
FDA 350.00 GIS 3.75
VDA 1040.00 LIC/GIS 509.10
CCA 100.00 HRR
HRA 1047.00 MSPI 60.00
Washing All. 75.00 Society 576.00
Conv. 225.00 Union 3.00
Cant.sub. 265.00 HBA 340.00
C.E.A. 2040.00 B.Fund10.00
Total 8632.00 Total 1989.85

3. The learned Tribunal opined that in computing his income, the element of conveyance
allowance only would fall outside the purview of income. On the aforementioned basis,
the monthly income of the deceased was assessed at Rs.20364/-. Applying the multiplier
of 13, as the age of the deceased was 45 years, it was held :
As such, on using multiple of 13 to the annual income of deceased at Rs.2,32,372/?, the
amount works out to Rs.30,20,836/-. The deceased would have spent 1/3rd of this amount
on himself, hence on deducting 1/3rd from this amount, 2/3rd compensation amount
comes to Rs.20,13,890/-."
It was concluded :
"Considering all these facts, I reach to this finding that the petitioners are entitled to get
2/3rd of the total income of deceased worked out by using multiple of 13 i.e. about
Rs.20,00,000/-. Issue No.5 is decided accordingly. It is the liability of opposite party No.3
Insurance Company. On behalf of opposite party No.3, the ruling of Hon'ble High Court
Smt. Lalta Devi Vs. Suresh and Ors., T.A.C. 8, 1999 (1) page 847 has been filed before
me, but this ruling does not extend any specific benefit to opposite party No.3. Hence,
while deciding this issue No.5, I come to this conclusion that the petitioners are entitled
to get Rs.20,00,000/- (Rs. Twenty Lakhs) as compensation."
4. The High Court, on an appeal having been preferred both by the appellant as also the
respondents, partly allowed the same by a common judgment holding that claimants were
entitled to compensation calculated in case of the deceased at Rs.19,53,224/- along with
interest @ 9% from the date of presentation of the claim petition till its realization,
holding that travelling reimbursement could not be taken into consideration for
computation of net income of the deceased.
5. Appellant is, thus, before us.
Keeping in view the importance of the question involved and furthermore in view of the
fact that the first respondent was appearing-in- person, we had requested Mr. L.N. Rao,
learned senior counsel, to assist us in the matter.
6. Submission of Mr. Satija, learned counsel appearing on behalf of the appellant, is that
for the purpose of computation of the amount of compensation what was material is the
basic pay and not other allowances and, in that view of the matter, the High Court has
committed a serious error in opining otherwise. The learned counsel contended that
emphasis by this Court are being laid on computation of damages based on net income
and not gross income. It was also contended that in any event the amount of
compensation awarded by the High Court is on higher side.
7. Mr. Rao, however, submitted that apart from the basic salary, contributions made by
the employee should also be taken into consideration for calculation of the amount of
compensation, inter alia, on the premise that the same would have become payable to him
at a future date as, for example, voluntary retirement, superannuation etc. which would be
beneficial to the entire family. It was pointed out that the contributions towards Provident
Fund, Life Insurance Corporation, gratuity etc. are includible in the definition of income.
8. The term "income" has different connotations for different purposes. A court of law,
having regard to the change in societal conditions must consider the question not only
having regard to pay packet the employee carries home at the end of the month but also
other perks which are beneficial to the members of the entire family. Loss caused to the
family on a death of a near and dear one can hardly be compensated on monetary terms.
9. Section 168 of the Act uses the word "just compensation" which, in our opinion,
should be assigned a broad meaning. We cannot, in determining the issue involved in the
matter, lose sight of the fact that the private sector companies in place of introducing a
pension scheme takes recourse to payment of contributory Provident Fund, Gratuity and
other perks to attract the
@page-SC847
people who are efficient and hard working. Different offers made to an officer by the
employer, same may be either for the benefit of the employee himself or for the benefit of
the entire family. If some facilities are being provided whereby the entire family stands to
benefit, the same, in our opinion, must be held to be relevant for the purpose of
computation of total income on the basis whereof the amount of compensation payable
for the death of the kith and kin of the applicants is required to be determined. For the
aforementioned purpose, we may notice the elements of pay, paid to the deceased :

?BASIC : 63,400.00
CONVEYANCE ALLOWANCE : 12,000.00
RENT CO LEASE : 49,200.00
BONUS (35% OF BASIC) : 21,840.00
___________
TOTAL : 1,45, 440.00
___________

In addition to above, his other entitlements were :

Con. to PF 10% of Basic Rs. 6,240/- (p.a.)


LTA reimbursement Rs. 7,000/- (p.a.)
Medical reimbursement Rs. 6,000/- (p.a.)
Superannuation 15% of BasicRs. 9,360/- (p.a.)
Gratuity Cont.5.34% of BasicRs. 3,332/- (p.a.)
Medical Policy-self and Family @ Rs.55,000/- (p.a.)
Education Scholarship @ Rs.500 Rs.12,000/- (p.a.)
Payable to his two children directly?
10. There are three basic features in the aforementioned statement which require our
consideration :
1. Reimbursement of rent would be equivalent to HRA;
2. Bonus is payable as a part of salary; and
3. Contribution to the Provident Fund.
11. We may furthermore notice that apart therefrom, superannuation benefits,
contributions towards gratuity, insurance of medical policy for self and family and
education scholarship were beneficial to the members of the family.
12. We have, however, no doubt in mind that medical reimbursement which provides for
a slab and which keeping in view the terminology used, would mean reimbursement for
medical expenses on production of medical bills and, thus, the same would not come
within the purview of the aforementioned category.
13

. The question came for consideration before a learned Single Judge of the Madras High
Court in The Manager, National Insurance Co. Ltd. v. Padmavathy and Ors. [CMA
No.114 of 2006 decided on 29.1.2007], wherein it was held : "Income tax, Professional
tax which are deducted from the salaried person goes to the coffers of the government
under specific head and there is no return. Whereas, the General Provident Fund, Special
Provident Fund, L.I.C., Contribution are amounts paid specific heads and the contribution
is always repayable to an employee at the time of voluntary retirement, death or for any
other reason. Such contribution made by the salaried person are deferred payments and
they are savings. The Supreme Court as well as various High Courts have held that the
compensation payable under the Motor Vehicles Act is statutory and that the deferred
payments made to the employee are contractual. Courts have held that there cannot be
any deductions in the statutory compensation, if the Legal Representatives are entitled to
lump sum payment under the contractual liability. If the contributions made by the
employee which are otherwise savings from the salary are deducted from the gross
income and only the net income is taken for computing the dependency compensation,
then the Legal Representatives of the victim reported in 2007 AIHC 1921

@page-SC848
would lose considerable portion of the income. In view of the settled proposition of law, I
am of the view, the Tribunal can make only statutory deductions such as Income tax and
professional tax and any other contribution, which is not repayable by the employer, from
the salary of the deceased person while determining the monthly income for computing
the dependency compensation. Any contribution made by the employee during his
lifetime, form part of the salary and they should be included in the monthly income,
while computing the dependency compensation."
14

. Similar view was expressed by a learned Single Judge of Andhra Pradesh High Court in
S. Narayanamma and Ors. v. Secretary to Government of India, Ministry of
Telecommunications and Ors. [2002 ACC 582], holding : "In this background, now we
will examine the present deductions made by the tribunal from the salary of the deceased
in fixing the monthly contribution of the deceased to his family. The tribunal has not even
taken proper care while deducting the amounts from the salary of the deceased, at least
the very nature of deductions from the salary of the deceased. My view is that the
deductions made by the tribunal from the salary such as recovery of housing loan, vehicle
loan, festival advance and other deductions, if any, to the benefit of the estate of the
deceased cannot be deducted while computing the net monthly earnings of the deceased.
These advances or loans are part of his salary. So far as House Rent Allowance is
concerned, it is beneficial to the entire family of the deceased during his tenure, but for
his untimely death the claimants are deprived of such benefit which they would have
enjoyed if the deceased is alive. On the other hand, allowances, like Travelling
Allowance, allowance for newspapers/periodicals, telephone, servant, club-fee, car
maintenance etc., by virtue of his vocation need not be included in the salary while
computing the net earnings of the deceased. The finding of the tribunal that the deceased
was getting Rs.1,401/- as net income every month is unsustainable as the deductions
made towards vehicle loan and other deductions were also taken into consideration while
fixing the monthly income of the deceased. The above finding of the tribunal is contrary
to the principle of just compensation enunciated by the Supreme Court in the judgment in
Helen's case (1 supra). The Supreme Court in Concord of India Insurance Co. v.
Nirmaladevi and Ors., 1980 ACJ 55 (SC) held that determination of quantum must be
liberal and not niggardly since law values life and limb in a free country ‘in generous
scales." AIR 2002 (NOC) 211
1998 AIR SCW 3103
AIR 1979 SC 1666

15. We may, however, notice that a Division Bench of this Court in Asha and Ors. v.
United Indian Insurance Co. Ltd. and Anr. [2004 ACC 533], whereupon reliance has been
placed by Mr. Satija, was considering a case where, like the present one, several perks
were included in salary. We may reproduce the salary certificate hereto below :
This is to certify that Shri A.M. Raikar was working as AG 111 in this organisation has
been paid the following Pay and Allowances for the month of May, 1995 :

Earnings Amount Deductions Amount


Basic 3420.00 CPF(S) 488.00
Special Pay 70.00 CPF (Add)
FDA 350.00 GIS 3.75
VDA 1040.00 LIC/GIS 509.10
CCA 100.00 HRA
HRA 1047.00 MSPI 160.00
Washing All. 75.00 Society 576.00
Conv. 225.00 Union 3.00
Cant.sub. 265.00 HBA 340.00
C.E.A. 2040.00 B.Fund10.00
Total 8632.00 Total 1989.85

Net Payable Rs. 6642.00 (Rupees six thousand six hundred forty two only)."
In that case, this Court held :
Lastly it was submitted that the salary certificate shows that the salary of the deceased
was Rs.8,632/-. It was submitted that the High Court was wrong in taking the salary to be
Rs.6,642/-. It was submitted that the High Court was wrong in deducting the allowances
and amounts paid towards LIC, Society charges and HBA etc. We are unable to accept
this submission also. The claimants are entitled to be compensated for the loss suffered
by them. The loss suffered by them is the amount which they would have been receiving
at the time when the deceased was alive. There can be no doubt that the dependents
would only be receiving the net amount less l/3rd for his personal expenses. The High
Court was therefore right in so holding."
@page-SC849
This Court in Asha (supra) did not address itself the questions raised before us. It does
not appear that any precedent was noticed nor the term just compensation was considered
in the light of the changing societal condition as also the perks which are paid to the
employee which may or may not attract income tax or any other tax.
What would be "just compensation" must be determined having regard to the facts and
circumstances of each case. The basis for considering the entire pay packet is what the
dependents have lost due to death of the deceased. It is in the nature of compensation for
future loss towards the family income.
16

. In Rathi Menon v. Union of India [(2001) 3 SCC 714], this Court, upon considering the
dictionary meaning of compensation held : 2001 AIR SCW 1074

“In this context a reference to Section 129 of the Act appears useful. The Central
Government is empowered by the said provision to make rules by notification "to carry
out the purposes of this Chapter". It is evident that one of the purposes of this chapter is
that the injured victims in railway accidents and untoward incidents must get
compensation. Though the word "compensation" is not defined in the Act or in the Rules
it is the giving of an equivalent or substitute of equivalent value. In Black’s Law
Dictionary , "compensation" is shown as
"equivalent in money for a loss sustained; or giving back an equivalent in either money
which is but the measure of value, or in actual value otherwise conferred; or recompense
in value for some loss, injury or service especially when it is given by statute."
It means when you pay the compensation in terms of money it must represent, on the date
of ordering such payment, the equivalent value.
25. In this context we may look at Section 128(1) also. It says that the right of any person
to claim compensation before the Claims Tribunal as indicated in Section 124 or 124-A
shall not affect the right of any such person to recover compensation payable under any
other law for the time being in force. But there is an interdict that no person shall be
entitled to claim compensation for more than once in respect of the same accident. This
means that the party has two alternatives, one is to avail himself of his civil remedy to
claim compensation based on common law or any other statutory provision, and the other
is to apply before the Claims Tribunal under Section 124 or 124-A of the Act. As he
cannot avail himself of both the remedies he has to choose one between the two. The
provisions in Chapter XIII of the Act are intended to provide a speedier remedy to the
victims of accidents and untoward incidents. If he were to choose the latter that does not
mean that he should be prepared to get a lesser amount. He is given the assurance by the
legislature that the Central Government is saddled with the task of prescribing fair and
just compensation in the Rules from time to time. The provisions are not intended to give
a gain to the Railway Administration but they are meant to afford just and reasonable
compensation to the victims as a speedier measure. If a person files a suit the amount of
compensation will depend upon what the court considers just and reasonable on the date
of determination. Hence when he goes before the Claims Tribunal claiming compensation
the determination of the amount should be as on the date of such determination."
17. The amounts, therefore, which were required to be paid to the deceased by his
employer by way of perks, should be included for computation of his monthly income as
that would have been added to his monthly income by way of contribution to the family
as contradistinguished to the ones which were for his benefit. We may, however, hasten to
add that from the said amount of income, the statutory amount of tax payable thereupon
must be deducted.
18. The term "income" in P. Ramanatha Aiyar's Advanced Law Lexicon (3rd Ed.) has
been defined as under :
"The value of any benefit or perquisite whether convertible into money or not, obtained
from a company either by a director or a person who has substantial interest in the
company, and any sum paid by such company in respect of any obligation, which but for
such payment would have been payable by the director or other person aforesaid,
occurring or arising to a person within the State from any profession, trade or calling
other than agriculture."
It has also been stated :
"INCOME" signifies "what comes in" (per Selborne, C., Jones v. Ogle, 42 LJ Ch.336). "It
is as large a word as can be used" to denote a person's receipts (per Jessel, M.R. Re
@page-SC850
Huggins, 51 LJ Ch.938.) income is not confined to receipts from business only and
means periodical receipts from one's work, lands, investments, etc. AIR 1921 Mad 427
(SB). Ref. 124 IC 511 : 1930 MWN 29 : 31 MLW 438 AIR 1930 Mad 626 : 58 MLJ
337."
19. If the dictionary meaning of the word "income" is taken to its logical conclusion, it
should include those benefits, either in terms of money or otherwise, which are taken into
consideration for the purpose of payment of income-tax or profession tax although some
elements thereof may or may not be taxable or would have been otherwise taxable but for
the exemption conferred thereupon under the statute.
20. In N. Sivammal and Ors. v. Managing Director, Pandian Roadways Corporation and
Ors. [(1985) 1 SCC 18], this Court took into consideration the pay packet of the
deceased.
21

. We may notice that in T. N. State Transport Corporation Ltd. v. S. Rajapriya and Ors.
[(2005) 6 SCC 236], this Court held :2005 AIR SCW 2542

"8. The assessment of damages to compensate the dependants is beset with difficulties
because from the nature of things, it has to take into account many imponderables e.g. the
life expectancy of the deceased and the dependants, the amount that the deceased would
have earned during the remainder of his life, the amount that he would have contributed
to the dependants during that period, the chances that the deceased may not have lived or
the dependants may not live up to the estimated remaining period of their life expectancy,
the chances that the deceased might have got better employment or income or might have
lost his employment or income together.
9. The manner of arriving at the damages is to ascertain the net income of the deceased
available for the support of himself and his dependants, and to deduct therefrom such part
of his income as the deceased was accustomed to spend upon himself, as regards both
self-maintenance and pleasure, and to ascertain what part of his net income the deceased
was accustomed to spend for the benefit of the dependants. Then that should be
capitalised by multiplying it by a figure representing the proper number of years"
purchase.
10. Much of the calculation necessarily remains in the realm of hypothesis and in that
region arithmetic is a good servant but a bad master" since there are so often many
imponderables. In every case it is the overall picture that matters", and the court must try
to assess as best as it can the loss suffered."
22

. Yet again in New India Assurance Co. Ltd. v. Charlie and Anr. [(2005) 10 SCC 720], the
same view was reiterated. However, therein although the words "net income" has been
used but the same itself would ordinarily mean gross income minus the statutory
deductions. We must also notice that the said decision has been followed in New India
Assurance Co. Ltd. v. Kalpana (Smt.) and Ors. [(2007) 3 SCC 538]. 2005 AIR
SCW 1801
2007 AIR SCW 1316

23. The expression just must also be given its logical meaning. Whereas it cannot be a
bonanza or a source of profit but in considering as to what would be just and equitable,
all facts and circumstances must be taken into consideration.
24. In view of our finding abovemention-ed, the appeal is to be allowed in part in so far
as the High Court had directed deduction of medical reimbursement and tax elements on
the entire sum which according to the statute constitute income. But we decline to do so
for two reasons. Firstly, the accident had taken place as far back as on 1st September,
1997 and secondly the Tribunal as also the High Court failed to take into consideration
rise in income of the deceased by way of promotion or otherwise.
25. For the aforementioned reasons, we are not inclined to interfere with the impugned
judgment. This appeal is, therefore, dismissed. In the facts and circumstances of the case,
there shall be no order as to costs.

AIR 2008 SUPREME COURT 850 "Dharmarajan v. Valliammal"


(From : Madras)*
Coram : 2 H. K. SEMA AND V. S. SIRPURKAR, JJ.
Civil Appeal Nos. 4535-4536 of 2001, D/- 11 -12 -2007.
Dharmarajan and Ors. v. Valliammal and Ors.
(A) Civil P.C. (5 of 1908), S.100 - APPEAL - HIGH COURT - Second appeal - Questions
formulated were neither questions of law nor
@page-SC851
substantial questions of law - High Court finding out new case which was not even
pleaded - High Court entering into appreciation of evidence on basis of non-existent
substantial questions of law - Order of High Court liable to be set aside.
S. A. Nos. 2235 and 2236 of 1986, D/- 25-6-1999 (Mad.), Reversed. (Paras 8, 11,
12, 14, 17)
(B) Limitation Act (36 of 1963), Art.64, Art.65 - LIMITATION - ADVERSE
POSSESSION - DOCUMENTS - INJUNCTION - Adverse possession - Possession of
claimant found to be permissive - Legal heirship of person claiming through original
claimant not decisively proved - No plea as to against whom adverse possession was
claimed - Documentary evidence to show that house registered in name of plaintiff and
he was paying house tax - In absence of revenue records in favour of defendant there was
no question of their title over property - Held that, defendant was not entitled to
injunction prayed for on basis of plea of adverse possession. (Paras 8, 11, 16)
Cases Referred : Chronological Paras
2006 AIR SCW 2404 : 2006 AIR SCW 1975 : 2006 (4) AIR Kar R 78 (Foll.) 14
2004 AIHC 4001 (Mad) (Disting.) 12
F. R. Kumar (for M/s. Parekh and Co.), for Appellants; P. Krishnamoorthy, Sr. Advocate,
R. Nedumaran and Sunil Kumar Singh, for Respondents.
* S.A. Nos. 2235 and 2236 of 1986, D/- 25-6-1999 (Mad).
Judgement
1. V. S. SIRPURKAR, J. :-A common judgment passed by Madras High Court allowing
two Second Appeals is in challenge before us. The Single Judge of the Madras High
Court set aside the appellate judgment, again a common one allowing appeals against the
common judgment passed by District Munsiff, Bhawani whereby the District Munsiff
had decreed the suit filed by one Muthuswami Gounder and dismissed the other suit filed
by Dharmarajan, the appellant herein. A short history of the case would be essential.
2. K. Muthuswami Gounder filed a suit registered as O.S. No.555 of 1991 for declaration
and injunction alleging that he had purchased suit property Survey No.324/D1 under a
Sale Deed dated 10-10-1980 from one Doraiswamy who was in possession and
enjoyment of the property. The said Doraiswamy was claimed to be a foster son of one
Karupayee who had expired in the year 1961 and who was claimed to be in possession
and enjoyment of the suit property wherein she had put up a thatched shed and was
residing for more than 30 years. It is claimed that after Karupayee her foster son who was
none else but his sister's son obtained the possession and enjoyed the said suit property.
Before this sale deed dated 10.10.1980, he had executed a Mortgage Deed in respect of
the suit property in favour of the plaintiff Muthuswami Gounder dated 15.6.1980. It was
further claimed that Doraiswamy was permitted to occupy the suit property as tenant on
monthly rent of Rs.50/-. It was further asserted that defendants 1 to 7, i.e., the present
appellants had also wanted to purchase the property from Doraiswamy but having failed,
they were falsely claiming certain rights in the suit property by creating some false
documents and that they had no right, title or possession. It was claimed that the plaintiff
and his predecessor, namely, Doraiswamy had acquired the title by adverse possession for
more than 60 years. It is on this basis that Muthuswamy Gounder claimed a decree for
declaration of his ownership as also for the injunction against the present appellants.
3. As against this, the present appellants claimed that this property in fact belonged to
first defendant therein, (the appellant No.1 herein) in so far as the Eastern half of the
property was concerned since it was purchased by the first defendant from one
Venkataramana Iyer. It was claimed that the suit property originally belonged to one K.V.
Krishnasamy and others and they were throughout in possession and enjoyment of the
suit property and were paying house tax also. The other appellants claimed the other half
of the property on the plea that they had purchased the same from the other co-sharer
Venugopal Iyer who had inherited the property from K.V. Krishnasamy and others. It was
claimed that Karuppayee was working as a maid servant under one Venugopala Iyer and
it was he who had permitted her to put up the thatched shed in the suit property and after
the death of Karuppayee, Doraiswamy started working as a servant of Venugopala Iyer
and as such he was in occupation of the thatched salai (house) with the permission of
Venugopala Iyer. It was claimed that the property stood in the name of Venugopala Iyer in
Kavundapady Panchayat. In short it was contended that the present appellants were
@page-SC852
owners of the property which they had purchased on 15.7.1980 and 27.8.1980 vide
different sale deeds. It was further claimed that after the purchase of the suit property, the
present appellants who were the defendants in Suit No.555 of 1981 were paying the taxes
and Doraiswamy was staying in the property with their permission. The original
defendants, the appellants herein stoutly denied the right of ownership on the part of
Doraiswamy to transfer the property in favour of the plaintiff. They also denied that
Karuppayee and after her Doraiswamy were in independent possession of the property.
They also denied that Karuppayee or, as the case may be Doraiswamy, had perfected their
title by adverse possession. Thus, the Appellant No.1 Dharmarajan claimed half of the
property whereas the rest of the appellants claimed the other half of the property being
purchasers from the members of Iyer family.
4. The Appellant No.1 Dharmarajan also filed a suit being OS No.280 of 1982 in respect
of the Eastern one half portion of the suit property of which he claimed the ownership
through the sale deed in the earlier suit. This suit was filed against Valliammal and
Palaniammal, who were the legal heirs of Doraiswamy. It must be stated here that
Doraiswamy had by then expired. This was also a suit for declaration of title of
Dharmarajan. In this suit it was claimed that the property originally belonged to the father
of Krishnasamy Iyer, Kandsamy Iyer and the father of one Vengugopala Iyer. In the
family arrangement the suit property was allotted to the father of Kandasamy Iyer and
Venkatasubramania Iyer, the son of Krishnasamy Iyer and the first appellant Dharmarajan
had purchased the suit property from Venkataramana Iyer on 15.7.1990 who was none
else but the son of Krishnaswami Iyer, both of whom were the heirs of Kandasamy Iyer.
An injunction was also claimed against the defendants. Valliammal and Palaniammal
firstly claimed that one suit was already filed against Doraiswamy being OS No.531 of
1981 and the said suit was dismissed. Doraiswamy had expired on 18.5.1981 and since
Valliammal and Palaniammal were the legal heirs of Doraiswamy, the suit was not
maintainable against them. Both these ladies claimed that they were in possession of the
suit property as the tenants under Muthuswami Gounder, the plaintiff in OS No.555 of
1981. They denied the ownership of the Iyer family on the suit property and claimed that
it was false to allege that the suit property was ever allotted to the father of Kandasamy
Iyer and Venkatasubramania Iyer. It was, therefore, pleaded that the vendors of the
plaintiff- Appellant No.1 herein were not entitled to the suit property and they were never
in possession of the same. It was claimed that the suit property was a poramboke land and
it was throughout in possession of Karuppayee Ammal who had perfected title to the
same by adverse possession. It was only Karuppayee who had put up thatched salai in the
suit property and her successor Doraiswamy was the husband of the first defendant
Valliammal and father of Palaniammal and after the death of Karuppayee Ammal he
continued to be in possession of the suit property as the heir of Karuppayee Ammal.
Karuppayee Ammal had died 20 years ago and after the death Doraiswamy had
mortgaged the suit property to Muthuswamy Gounder on 10.10.1980 and thereafter the
Doraiswamy and defendants 1 and 2 continued to be in possession of the suit property as
tenants of Muthuswamy and on that count the suit was liable to be dismissed.
5. The Trial Court decreed the Suit No.555 of 1981 and dismissed Suit No.280 of 1982
filed by the appellant No.1 in respect of the half of the suit property. Two appeals came to
be filed which were allowed whereby the Appellate Court dismissed Suit No.555 of 1981
and decreed Suit No.280 of 1982 only to the extent of the decree of declaration of title.
However, since the plaintiff therein (the appellant herein) had not terminated the licence
of Valliammal and Palaniammal in respect of the suit property that relief was denied to
the appellant No.1 herein and the suit succeeded only partly. As stated earlier, the plaintiff
Muthuswamy Gounder filed Second Appeal No.2236 of 1986 while Valliammal filed
Second Appeal No.2235 of 1986 which appeals have been allowed by the learned Single
Judge of the High Court and that is how the parties are before us in the present two
appeals.
6. Learned counsel appearing for the appellant seriously criticized the High Court
judgment firstly that the High Court had entered into a prohibited arena of re-appreciation
of evidence. It was contended that the appellate court was the final court of facts and yet
even without discussing the
@page-SC853
appellate court judgment, considering the approach thereof, the High Court had re-
appreciated the evidence and had upset the well considered judgment of the appellate
court. Secondly, the learned counsel urged that an entirely new case which was not even
pleaded by the plaintiff in Suit No.555 of 1981 was found out by the High Court and on
that basis chose to decree the said suit which was dismissed by the appellate court. It was
further pointed out that the sole plea raised in the plaint was that the plaintiff had derived
his title vide a Sale Deed from Doraiswamy who himself had continued to be in adverse
possession after Karupayee Ammal. In short the basis of the plea of plaintiff was his valid
title. Learned counsel was at pains to point out that the case regarding adverse possession
was very rightly held not proved by the appellate court and indeed there could not be any
adverse possession since the adverse nature of possession was not proved at all. Learned
counsel pointed out that the plea regarding adverse possession was a confused plea
inasmuch as it was not even pleaded as to against whom was the possession of Karupayee
Ammal and Doraiswamy adverse. Learned counsel, therefore, pleaded that once that plea
was rejected, there was no question of decreeing the suit and the suit should have been
straightway dismissed as was done by the appellate court. Instead the High Court had
found entirely different theory by trying to re-appreciate the evidence even regarding the
boundaries of the plot and the identification thereof which was nobody's case.
7. As against this the learned counsel for the respondent supported the judgment and
suggested that though the plea of adverse possession was not proved, still what was
transferred by Doraiswamy was a possessory title. Learned counsel tried to urge that
Karupayee Ammal continued on the land and she became the owner of the land in
question because of her long possession over natham poramboke and hence Doraiswamy
who continued after her demise would inherit the same rights, he being her legal
representative. It is these rights which he had transferred in favour of Muthuswami
Gounder and, therefore Muthuswamy Gounder had a better title as against the present
appellant Dharmarajan who merely claimed a Sale Deed from non-existent owner.
8. A glance at the High Court judgment suggests that the High Court has gone into a
dangerous area of appreciation of evidence, that too on the basis of non existent
substantial questions of law. The five questions of law framed by the High Court were as
follows :
"(1) Whether the admitted long possession of the original owner Karupayee and that of
Doraiswamy who claims title through her cannot be tacked together in law for the
purpose of adverse possession?
(2) Whether the burden is not on the plaintiff who is out of possession to prove that he
has got valid title in the suit properties as laid down by this Court?
(3) Whether non-examination of the vendors of the plaintiff is not fatal to the case of the
plaintiff?
(4) Whether Ex.A-8 is not admissible in evidence? And
(5) Whether lower appellate court is justified in decreeing the suit for declaration, having
found that the defendants are in possession and having refused to grant injunction in
favour of the plaintiff?"
In our opinion none of these questions could be said to be either question of law or a
substantial question of law arising out of the pleadings of the parties. The first referred
question of law could not and did not arise for the simple reason that the plea of adverse
possession has been rightly found against the plaintiff. Karupayee Ammal's possession,
even if presumed to be in a valid possession in law, could not be said to be adverse
possession as throughout it was the case of the appellant Dharmarajan that it was a
permissive possession and that she was permitted to stay on the land belonging to the
members of the Iyer family. Secondly it has nowhere come as to against whom was her
possession adverse. Was it adverse against the Government or against the Iyer family? In
order to substantiate the plea of adverse possession, the possession has to be open and
adverse to the owner of the property in question. The evidence did not show this
openness and adverse nature because it is not even certain as to against whom the adverse
possession was pleaded on the part of Karupayee Ammal. Further even the legal
relationship of Doraiswamy and Karupayee Ammal is not pleaded or proved. All that is
pleaded is that after Karupayee Ammal's demise Doraiswamy as
@page-SC854
her foster son continued in the thatched shed allegedly constructed by Karupayee Ammal.
There was no question of the tacking of possession as there is ample evidence on record
to suggest that Doraiswamy also was in the service of Iyer family and that he was
permitted to stay after Karupayee Ammal. Further his legal heirship was also not
decisively proved. We do not, therefore, see as to how the first substantial question of law
came to be framed. This is apart from the fact that ultimately High Court has not granted
the relief to the respondents on the basis of the finding of this question. On the other hand
the High Court has gone into entirely different consideration based on reappreciation of
evidence. The second and third questions are not the questions of law at all. They are
regarding appreciation of evidence. The fourth question is regarding the admissibility of
Exhibit A-8. In our opinion there is no question of admissibility as the High Court has
found that Exhibit A-8 was not admissible in evidence since the Tehsildar who had issued
that certificate was not examined. Therefore, there will be no question of admissibility
since the document itself was not proved. Again the finding of the High Court goes
against the respondent herein. Even the fifth question was a clear cut question of fact and
was, therefore, impermissible in the Second Appeal.
9. It must be remembered that plaintiff Muthuswamy Gounder had claimed the title and
possession in respect of the suit property by virtue of Exhibit A-1, Sale Deed dated
10.10.1980 and before which he had also obtained the mortgage in respect of this
property from Doraiswamy. It was, therefore, imperative on the part of the plaintiff to
prove a valid title on the part of the Doraiswamy. The High Court has rightly not accepted
the case of adverse possession though it has given a confused finding about it. However,
one look at pleadings suggests that the only plea regarding the ownership of Doraiswamy
was based solely on the plea of his adverse possession. Once that position is clear, the
High Court could not have gone into any other aspect which was not even pleaded in the
plaint. Instead of discussing the evidence of the plaintiff since the burden was entirely on
the plaintiff Muthuswamy Gounder, his being a prior suit, the High Court went on to
discuss the evidence on the part of defendant Dharmarajan who was the purchaser of the
Eastern half of the suit property under Exhibits B-12 and B-13 and the other defendants 2
to 5 who had purchased the Western half of the suit property under Exhibits B-1 and B-2.
Thereafter the High Court has given a finding that Karupayee Ammal was in possession
of the land for 50 years or so and thereafter her foster son Doraiswamy continued and,
therefore, the possession of Karupayee Ammal and Doraiswamy could be tacked together
and that the appellate court was wrong in treating the possession of Karupayee Ammal
and subsequently by Doraiswamy as distinct and separate. All these findings are of no use
whatsoever for the simple reason that the theory of adverse possession had already failed.
Even the High Court has observed that it is not as if the plaintiff is claiming the right only
by adverse possession. Further the High Court found out that the property was a village
Natham and, therefore, the person who first occupied the same and was residing therein is
entitled to title. The High Court has, from nowhere, found out that it was an unoccupied
Natham and Karupayee Ammal has entered the possession and was residing there by
putting up a house and fencing the property and that she would be entitled to declaration
of her occupancy rights or title because the Government is not claiming it as a poramboke
or its vesting with the Government. We fail to follow any basis for this finding of the
High Court. There is no pleading about this. There is not even an iota of evidence in the
village records in favour of either Karupayee Ammal or Doraiswamy and their so-called
rights. There is a Gram Panchayat in the village and we are certain that there would have
been some evidence in the shape of revenue records in favour of either of these two, had
the case of uninterrupted possession of Karupayee Ammal on village Natham for 50
years, was true. The High Court has found out an entirely different case. The High Court
has lastly held that a continuous possession independently by the person in possession
will definitely entitle him to the property in view of the fact that the property is only a
Natham and not a poramboke. We are afraid this was not a case pleaded in the plaint at
all. In fact excepting the plea of adverse possession, no other plea has been raised.
Therefore, the High Court has clearly erred in this aspect. Similarly the High Court in
para 13 went into the question of identity of suit property
@page-SC855
without there being any pleading and a long and unnecessary discussion.
10. There was a previous litigation in OS No.49 of 1963 before the Subordinate Judge,
Erode which was the suit for partition and separate possession filed by one Venugopal
Iyer against Venkataramana Iyer and his sons. The appellant Dharmarajan had produced
Exhibit B-6, the Judgment which showed that the Brahmin family under whom the
present defendants claimed title was represented by four brothers representing four
branches and they were Ramaswamy Iyer, Venkatasubba Iyer, Krishnaswamy Iyer and
Subramaniya Iyer. There was a partition between these four brothers and as per the
Agreement Krishnaswamy Iyer and Subramania Iyer were allotted the property jointly as
against their shares, Ramaswamy Iyer and Venkatasubba Iyer were dealing separately
their respective shares. It was Subramania Iyer's son Venugopal Iyer who was the plaintiff
in the said suit while Venkataramana Iyer and his sons who were the descendants of
Krishnaswamy Iyer were the main defendants therein. The High Court has gone through
this judgment and has recorded that ultimately the partition was granted only in respect of
Survey No.361/D of Kavundapadi village which was Plaint "A" Schedule and the
backyard of the house which was Plaint "B" Schedule and in other aspects the suit was
dismissed. What the High Court has failed to see is that there is a mention of the property
in the suit in this litigation. The High Court ultimately gave a finding that the suit
property was not the subject-matter as it was lying South of Kattabomman Street and this
property was not, therefore, partitioned in the said suit. In its enthusiasm the High Court
has given a finding that the house was extended further south to the East West
Kattabomman Street and, therefore, the vendors of the defendants (Dharamrajan and
others) had not chosen to deal with suit property even as early as 1957. Ultimately the
High Court has given a finding that the suit property was not the subject- matter of
Exhibit A-11 partitioned in the year 1957.
11. It was pointed out by the learned counsel appearing on behalf of the appellant that
there is a definite mention in Suit OS No.49 of 1963 of the suit property. As if this was
not sufficient, the learned counsel has also pointed out that the suit property was
registered in the name of Venugopala Iyer in Kavundapadi Panchayat and he has also
paid house tax to the Panchayat for the suit property. There is a receipt (Exhibit B-3) on
record of the house tax paid by the Iyer family which is long prior to the suit. There is
also a certificate (Exhibit B-5) to show that house was registered in the name of
Venugopala Iyer for a period even prior to 1977. The appellate court had accepted this
documentary evidence. In our opinion that would be the end of the matter and in the
absence of any revenue records in favour of either Karupayee Ammal or Doraiswamy,
there was no question of their title over the land. The High Court has, in para 24,
recorded:
"The question of adverse possession does not actually arise because the Brahmin family
never asserted title over the suit property and the defendants only with a view to harass
the plaintiff has gone and taken sale deeds from the members of the Brahmin family in
the year 1980 knowing fully well that all along the family never asserted title and had
never been in possession of the suit property."
In our opinion these findings are entirely erroneous and the High Court has gravely erred
in interfering with a well considered judgment and findings of fact of the appellate court
who has accepted the case of the defendant and has chosen to hold that the plaintiff in OS
No.555 of 1981 was not able to discharge the burden at all.
12

. In the absence of pleadings, the High Court gravely erred in finding out an entirely new
case on the basis of unpleaded facts and non existent rights. Learned counsel for the
respondent tried to suggest that this was a Natham and the parties had proceeded on that
basis and, therefore, the long standing possession of Karupayee Ammal and thereafter of
Doraiswamy would clothe them with the ownership. In the first place that it was a
Natham was not pleaded. Secondly, there is nothing to suggest that this long standing
possession could clothe the Karupayee Ammal and Doraiswamy with the ownership
rights. That was neither a case pleaded nor proved. Again there was nothing in the shape
of revenue records in favour of Karupayee Ammal and Doraiswamy. Learned counsel
relied upon the judgment of the Madras High Court in The Executive Officer, Kadathur
Town Panchayat, Harur Taluk, 2004 AIHC 4001

@page-SC856
Dharama-puri District v. I.V. Swaminatha and Ors. [(2004) 3 L.W. 278] delivered by the
Division Bench thereof in support of his contention that a long possession over Gram
Natham ripens into the ownership rights. We are afraid the judgment is being read too
broadly. No such proposition of law emerges from that judgment.
13. On the other hand the appellate court has rightly relied on the tax receipts and the
entry in the name of Venugopala Iyer in respect of the suit land in Survey No.324 Ward
No.4. The appellte court had also correctly held that the suit property was mentioned in
Exhibits B-6 and B-7 as also in the decree in OS 49 of 1963 in Item No.1 of Schedule C
property which was not divided. All the lengthy discussion by the High Court over that
issue was not only uncalled for but the High Court has gravely erred in setting aside the
finding of the appellate court that the suit property was the property of Item No.I of
Schedule C in Exhibit B-7.
14

. This Court has, time and again, explained the scope of Section 100 CPC, more
particularly in Gurudev Kaur and Others vs. Kaki and Others [(2007) 1 SCC 546] where
it was held that even before the 1976 amendment the scope of such interference under
Section 100 drastically curtailed and narrowed down. It is specifically held that the High
Court would have jurisdiction of interfering only in a case where substantial questions of
law are involved and those questions are clearly formulated in the Memorandum of
Appeal. We have already shown that the questions formulated were neither the questions
of law nor substantial questions of law. This is apart from the fact that in the present case
the High Court has completely gone astray inasmuch as it is not even realized that it was
a case which was not even pleaded. In Gurudev Kaur's case the above mentioned position
stated by us in respect of substantial question of law has been reiterated. Thus, the
judgment suffers from error of law. 2006 AIR SCW 2404

15. Learned counsel for the respondent lastly suggested that Doraiswamy had transferred
the possessory title and, therefore, the plaintiff in OS No.555 of 1981 was justified in
filing the suit against the present defendants. This was not even the case pleaded. On the
other hand what was pleaded was adverse possession alone. This is apart from the fact
that all through the plaintiff claimed a title and ownership from Doraiswamy, who
according to the plaintiff, had both ownership and the title to the suit property. The term
possessory title was not even whispered anywhere. We are, therefore, unable to accept the
contention of the learned counsel on behalf of the respondent.
16. Once the suit of Muthuswamy Gounder fails, then the other suit filed by Dharamrajan
being OS 280 of 1982 in respect of the Eastern half portion of the suit property must
succeed. The appellate court has rightly granted the declaration in that suit and has also
restricted the relief only to the declaration since Dharmrajan and the other defendants had
not terminated or revoked the licence of Doraiswamy or his wife Valliammal or daughter
Palaniammal. The First Appellate Court had also correctly held that appellant in AS
No.10/1995 in OS No.280/1982 had established title of his vendors and further that his
vendors has passed a valid title to him with respect to the suit property under Exhibits B-
12 and B-13. We also accept the judgment of the appellate court that Dharamrajan and
other defendants were not entitled to the injunction prayed for.
17. In the result the appeals succeed with costs. The judgment of the High Court is set
aside and that of the First Appellate Court is restored.
Order accordingly.
AIR 2008 SUPREME COURT 856 "Union of India v. S. R. Dhingra"
Coram : 2 A. K. MATHUR AND MARKANDEY KATJU, JJ.
Transferred Case (Civil) No. 106 of 2006, D/- 14 -12 -2007.
Union of India v. S. R. Dhingra and Ors.
Constitution of India, Art.16 - Railway Establishment Code, R.2544(g) - EQUALITY IN
PUBLIC EMPLOYMENT - RAILWAY - PENSION - PAY COMMISSION - Pension -
'Running staff' of railways - Inclusion of "running allowance" to arrive at average
emoluments - Pre-1986 retirees - Recomputation of pension to give benefits of 5th Pay
Commission - Fixation of notional pay of pre-1986 retirees as on 1-1-86 - Running
allowance that has been considered at time of retirement - Not to be considered again
while fixing notional pay. (Paras 23, 24, 26)
@page-SC857
Cases Referred : Chronological Paras
2006 AIR SCW 5252 : 2006 Lab IC 4210 : 2007 (1) AIR Kar R 33 25
2000 AIR SCW 3422 : AIR 2000 SC 3113 : 2000 Lab IC 3298 25
1998 AIR SCW 3431 : AIR 1999 SC 81 : 1998 Lab IC 3579 25
1997 AIR SCW 3747 : AIR 1997 SC 3828 : 1998 Lab IC 100 7, 18
1991 AIR SCW 327 : AIR 1991 SC 1182 : 1991 Lab IC 573 25
AIR 1990 SC 1782 : 1990 Lab IC 1490 25
AIR 1983 SC 130 : 1983 Lab IC 1 25
A. Sharan, ASG, Kumar Rajesh Singh, Satyakam, Amit Anand, B. Krishna Prasad, for
Petitioner; R. Venkataramani, Sr. Advocate, J. M. Khanna, Y. Raja Gopala Rao, Y.
Ramesh, Ms. Y. Vismai Rao, for Respondents.
Judgement
1. MARKANDEY KATJU, J.:-Writ Petition No. 4648/2002 titled Union of India and
another vs. S.R. Dhingra and others was filed in the Delhi High Court and was thereafter
transferred to this Court by order dated 9.5.2006 in Transfer Petition (Civil) No. 278 of
2005.
2. It appears that similar matters were pending before the Delhi High Court, Punjab and
Haryana High Court and Central Administrative Tribunal and further proceedings in
those cases were ordered to be stayed awaiting the judgment in the matter which was
transferred to this Court by the order dated 9.5.2006.
3. The facts of the case are that in the Railways there are certain employees such as
drivers, guards, shunters etc, who go along with the railway train and are categorized as
Running Staff. Such staffs are entitled to an allowance called Running Allowance which
is apart from their salary. Computation of pension after retirement in the railways is made
on the basis of average emoluments plus a part of the running allowance which is
included in average emoluments in terms of Rule 2544(g) of the Indian Railway
Establishment Code. The present dispute relates to the pension for the running staff who
retired prior to 1986.
4. Prior to its amendment Rule 2544(g) running allowance up to a maximum of 75% of
pay and other allowances was added to the pay for computing pension. Subsequently, by
notification dated 5.12.1988 Rule 2544 was amended, and the maximum limit of the
running allowance was fixed at 45% of the pay in the revised scale of pay. Thereafter by
another amendment this was raised to 55% of the average pay.
5. The validity of this amendment was challenged before the Central Administrative
Tribunal by means of a petition which was allowed by the Ernakulam Bench by the order
dated 20.4.1990 and the impugned notification was quashed to the extent that the
amendment of Rule 2544(g) was given retrospective effect.
6. A contrary view was taken by another Bench of the Tribunal and hence the matter was
referred to a Full Bench, and the Full Bench agreed with the view taken by the
Ernakulam Bench.
7

. The matter was then carried in appeal to this Court in Chairman, Railways Board and
others vs. C.R. Ranga-dhamaiah and others, 1997(6) SCC 623 which gave its judgment
on 25.7.1997, upholding the decision of the Full Bench of the Tribunal. 1997 AIR
SCW 3747

8. It may be mentioned that the Tribunal had struck down the retrospective operation of
the notification dated 5.12.1988 issued in exercise of the power of the President under the
proviso to Article 309 of the Constitution whereby Rule 2544 of the Indian Railway
Establishment Code was amended with retrospective effect. In the aforesaid decision this
Court dismissed the appeals filed by the Union of India and the Railway Administration
and upheld the view taken by the Full Bench of the Tribunal.
9. To implement the aforesaid decision of this Court the Railway Board issued
instructions on 14.10.1997 that the pension and other retiral benefits of the railway
running staff who retired between 1.1.1973 to 4.12.1988 should be re-computed, and
arrears on account of re-computation of pension be paid to them accordingly.
10. In the meanwhile the Fifth Pay Commission report was rendered and in
implementation of some of the recommendations in respect of the pre-1986 retirees the
Department of Personnel and PW issued OM dated 27.10.1997 that pension/family
pension will be consolidated w.e.f. 1.1.1996 by adding together their existing
pension/family pension, dearness relief, interim relief I and interim relief II and fitment
weightage of 40%. The said revision was to be done on the basis of existing pension. It is
not in dispute that the said relief was extended to the
@page-SC858
respondents herein and all those similarly placed with the respondents.
11. In order to implement another recommendation of the 5th Pay Commission to give
parity to the pre-1986 retirees with the post 1986 retirees, it was decided to fix the pay of
the pre-1986 retirees as on 1.1.1986. However, it was specifically provided that the pay
so fixed would be treated as average emoluments. Accordingly, on 10.2.1998, a further
Office Memorandum was issued providing for fixation of notional pay of all those
Government servants who retired prior to 1.1.1986 as on 1.1.1986. The pay was to be
fixed on notional basis in the scale revised with effect from 1.1.1986. It was provided that
the notional pay so arrived as on 1.1.1986 shall be treated as average emoluments for the
purpose of calculation of pension and accordingly the pension shall be calculated as on
1.1.1986 as per the pension formula then prescribed. (The then formula was 50% of
average emoluments. Thus 50% of the pay notionally fixed was to be treated as pension
of the respective pre-1986 retirees).
12. Learned Addl. Solicitor General, Shri Amarendra Sharan, appearing for the appellants
submitted that the OM dated 10.2.1998 is very clear that what is to be fixed is the pay on
notional basis, and pay, according to the rules, does not include running allowance.
However, running allowance is a relevant factor for calculating average emoluments. He
submitted that the said OM clearly provides that the notional pay so arrived at will be
treated as average emoluments, meaning thereby that all other elements provided in rule
2544 which otherwise could have been added to pay for arriving at average emoluments
were expressly excluded. He further submitted that the pay notionally fixed includes
existing (pre-1986) basic pay, dearness pay, additional dearness allowance, ad hoc
dearness allowance, first and second installments of interim relief calculated on basic pay
plus 30% basic pay in the existing scale as pay element of running allowance, and fitment
weightage at the rate of 20% of existing basic pay.
13. On 24.7.1998, it was clarified by the department that in cases where the amount of
revised pension arrived at on the basis of notional fixation of pay as on 1.1.1986 happens
to be less than the amount of consolidated pension already drawn by pre-1986 retirees,
there is no need to revise the existing pension and issue a revised PPO.
14. Due to certain doubts and confusion, a clarification was sought as to whether running
allowance was to be added again while fixing the pay notionally as per the OM dated
10.2.1998. On 29.12.1999, the Railway Board issued clarification that running allowance
was not to be taken into consideration at the time of re-fixation of pay on notional basis
on 1.1.1986.
15. The said clarification was challenged by way of an Original Application before the
Central Administrative Tribunal by the respondents. On 22.10.2000 the appellants
(respondents in OA) contested the original application of the respondents (appellants in
OA) before the Central Administrative Tribunal, Principal Bench, New Delhi by filing
their detailed counter reply dated 28.5.2001 in which preliminary objections were also
raised regarding maintainability of the original applications. It was pointed out that only
the pay was to be notionally fixed as per the OM dated 10.2.1998, and therefore, there
was no need to add running allowance again since running allowance would be added
only if on the basis of pay so fixed the average emoluments was to be recalculated. The
said course of recalculation of average emoluments was specifically excluded by the said
OM dated 10.2.1998.
16. On 22.1.2002, the Central Administrative Tribunal, Principal Bench, New Delhi
passed an order allowing the O.A. of the respondents herein and quashed the Railway
Boards clarification dated 29.12.1999. Thereafter various writ petitions were filed in the
Delhi High Court and ultimately writ petition No. 4648/2002 was transferred to this
Court by order of this Court dated 9.5.2006 (as already stated above).
17. We have carefully perused the record and heard learned counsel for the parties.
18

. Leaned counsel for the appellant submitted that the pension of the respondents which
was recomputed on the basis of the judgment of this Court in Chairman, Railways Board
and others vs. C.R. Rangadhamaiah and others (supra) is fully protected and the
respondents will continue to take the benefits in future also. However, he submitted that
the pensionary benefits of the respondents who retired prior to 1.1.1986 was to be
determined by fixing notional pay w.e.f. 1997 AIR SCW 3747

@page-SC859
1.1.1986 and further pension was to be re-fixed w.e.f. 1.1.1986 without taking into
consideration the running allowance as per the policy of the Railway Board for
implementation of the recommendation of the 5th Central Pay Commission while
revising the retiral benefits w.e.f. 1.1.1986. He submitted that there was no infirmity in
the policy issued by the Department of Personnel and PW and adopted by the Railway
Board, and subsequent circulars issued by the Railway Board regarding release of retiral
benefits to the employees who retired prior to 1.1.1986.
19. Learned Additional Solicitor General submitted that while fixing the pension
notionally, due to a clerical mistake it had been fixed at much higher amount, and this
error, when discovered, was later rectified and the pension of the respondents was
correctly revised w.e.f. 1.1.1986.
20. We have carefully considered the submission of the learned counsels for the parties
and we are in agreement with the submission of the learned Additional Solicitor General.
21. In this connection it may be mentioned that the Railway Board vide its letter dated
29.12.1999 issued a clarification to the earlier instructions dated 10.2.1998 issued by the
Department of Personnel and PW, which is the nodal department of the government of
India for framing policy instructions on pensionary matters.
22. It has also been clarified by the Department of Personnel and PW vide their O.M.
No. 45/86/97-P and W (A) Pt. III dated 24.7.1998 circulated vide Railway Boards letter
No. F(E)-III/98/PN-1/2 dated 2.9.1998 that if the pension revised on notional fixation of
pay as on 1.1.1986 happens to be less than the pension already drawn by the pensioner
the same should not be reduced to their disadvantage. In the case of Medical Officers, the
Department of Personnel and Pensioners Welfare have already clarified vide their OM
No. 45/3/99-P and PW (A) dated 12.10.1999 circulated vide Railway Boards letter No.
F(E)-III/98/PN-1/29 dated 12.11.1999 that non-practising allowance which was already
taken into account for calculating the pension and other benefits at the time of retirement
is not to be added to the pay of the pre-1986 retirees revised on notional basis as on
1.1.1986, as the same is not permissible in terms of para No. 2 of their instructions dated
10.2.1998. The nature of running allowance is similar to that of non-practising allowance,
and the Railway Board issued instructions dated 29.12.1999 clarifying that running
allowance is not to be added to the pay of pre-1986 retirees revised on notional basis as
on 1.1.1986.
23. We are of the opinion that the clarification of the Railway Board issued dated
29.12.1999 clarifying that the running allowance which was already taken into account
for pension and other benefits at the time of retirement is not to be added to the pay of
pre-1986 retirees revised on notional basis as on 1.1.1986 is valid. It appears that due to a
clerical error the notional benefits of the respondents w.e.f. 1.1.1986 was wrongly fixed
and such retired employees are getting excess pension. It is well-settled that a mistake
does not confer any right to any party, and can be corrected.
24. We are of the opinion that the benefit of running allowance has to be taken into
consideration for computing pension only once. It had been taken into consideration
while fixing the pension of the respondents at the time of their retirement. In our opinion
it is not required to be taken into account again for any future calculation.
25

. It is well settled that when two sets of employees of the same rank retire at different
points of time, one set cannot claim the benefit extended to the other set on the ground
that they are similarly situated. Though they retired with the same rank, they are not of
the same class or homogeneous group. Hence Article 14 has no application. The
employer can validly fix a cut-off date for introducing any new pension/retirement
scheme or for discontinuance of any existing scheme. What is discriminatory is
introduction of a benefit retrospectively (or prospectively) fixing a cut-off date arbitrarily
thereby dividing a single homogenous class of pensioners into two groups and subjecting
them to different treatment (vide Col. B.J. Akkara (Retd.) vs. Govt. of India (2006) 11
SCC 709, D.S. Nakara vs. Union of India (1983) 1 SCC 305, Krishna Kumar vs. Union
of India (1990) 4 SCC 207, Indian Ex-Services League vs. Union of India (1991) 2 SCC
104, V. Kasturi vs. Managing Director, State Bank of India 2006 AIR SCW 5252

AIR 1983 SC 130


AIR 1990 SC 1782
1991 AIR SCW 327
1998 AIR SCW 3431
2000 AIR SCW 3422

@page-SC860
(1998) 8 SCC 30 and Union of India vs. Dr. Vijayapurapu Subbayamma (2000) 7 SCC
662).
26. In view of the above, we are of the opinion that the benefit of running allowance
which has been given to the respondent at the time of retirement is not to be given again
vide Office Memorandum dated 10.2.1998.
27. Accordingly Writ Petition No. 4648/2002 which has been transferred to this Court is
allowed and the order of the Central Administrative Tribunal dated 22.1.2002 is set aside.
This decision will govern all similar matters pending in the High Courts or Tribunal.
28. However, any amount already paid to the respondents and other similarly situated
persons shall not be recovered from them.
29. The Transfer Case stands allowed.
Order accordingly.
AIR 2008 SUPREME COURT 860 "Union of India v. Smt. Sadhana Khanna"
(From : Delhi)
Coram : 2 A. K. MATHUR AND MARKANDEY KATJU, JJ.
Civil Appeal No. 8208 of 2001, D/- 14 -12 -2007.
Union of India v. Smt. Sadhana Khanna.
Constitution of India, Art.16 - EQUALITY IN PUBLIC EMPLOYMENT -
PROMOTION - SENIORITY - Promotion - Select list (seniority quota) - Inclusion in -
Minimum eligibility service requirement - Letter of appointment was offered to senior,
respondent on 5-7-1983 i.e. after 1-7-1983, a date from which eligibility was to be
counted - However juniors to respondent were issued letters offering appointment prior to
1-7-1983 - It was Department which is to be blamed for this - Office memorandum
stating that where junior had completed eligibility requirement of promotion then their
seniors will also be considered even if they have not completed eligibility period - Thus
inclusion of juniors and not senior in select list - Not proper.
AIR 1988 SC 902, Foll. (Para 11)
Cases Referred : Chronological Paras
AIR 1988 SC 902 : 1988 Lab IC 999 (Foll.) 9
T. S. Doabia, Sr. Advocate, Mrs. Kiran Bhardwaj, Mrs. Sushma Suri, Manpreet Singh
Doabia, for Appellant; Ms. Rachna Gupta, Dr. Indra Pratap Singh, Amrit Singh, for
Respondent.
Judgement
1. MARKANDEY KATJU, J. :-This appeal has been filed against the impugned
judgment of the Delhi High Court dated 21.3.2000 in Civil Writ Petition No.1311 of
2000.
2. Heard learned counsel for the parties and perused the record.
3. The facts of the case are that the respondent joined the Central Secretariat Service on
13.7.1983 after passing Assistants Grade Examination held in October, 1981. The
respondent was allocated to the finance cadre comprising the Ministry of Finance.
4. After completion of eight years of regular service in the grade of Assistant, the
respondent was granted a short-term promotion to the grade of Section Officer on
24.7.1991. The respondent continues to work in this post till date.
5. Select List (Seniority quota) for promotion to the Section Officers Grade for the year
1991 was issued on 28th May, 1993. The respondents name has not been included in this
select list although the respondent was qualified to be included in the select list. Officers
junior to the respondent who have secured lower rank in the Assistant Grade Examination
1981 have been included in the select list for Section Officers 1991.
6. The seniority list of Assistants Grade had been issued on 1st October, 1990. In this list
the respondent ranks at S.N.29 whereas other officers of the same grade at S.Nos.30, 32,
34, 25 and so on who are junior to the respondent in this seniority list have superseded
the respondent and promoted as Section Officer on the basis of the Select List of 1991.
Promotion to the post of section officers from the grade of Assistant to the grade of
Section Officers (seniority quota) is on non-selection basis, based only on seniority.
7. The grievance of the respondent was that her juniors were included in the select list but
her name was not so included. Hence, she filed an O.A. before the Central Administrative
Tribunal.
@page-SC861
8. In the counter affidavit filed before the Tribunal the appellant herein (respondent
before the Tribunal) alleged that the respondent was not eligible for inclusion in the
Select List of 1991, since on 1-7-1991 she was short of the minimum eligibility service
requirement of eight years by twelve days. The respondent joined as Assistant on 13-7-
1983 and as such she could not be placed on the select list.
9

. The Tribunal allowed the O.A. by its order dated 24-9-1999. In the said O.A. it was held
that the Department of Personnel and Training had issued an Office Memorandum dated
19.7.1989 soon after the decision of this Court in R. Prabha Devi and others vs.
Government of India Through Secretary, Ministry of Personnel and Training,
Administrative Reforms and others 1988 (2) SCC 233 stating that where the junior had
completed the eligibility requirement of promotion then their seniors will also be
considered even if they have not completed the eligibility period. AIR 1988 SC 902

10. The appellant filed a writ petition before the Delhi High Court which was dismissed
and hence this appeal.
11. It may be noted that the respondent was offered appointment vide letter dated 5-7-
1983 which is after 1-7-1983 from which the eligibility was to be counted. Hence, it is
the Department which is to blame for sending the letter offering appointment after 1-7-
1983. In fact, some of the candidates who were juniors to the respondent were issued
letters offering appointment prior to 1-7-1983. Hence it was the Department which is to
blame for this. Moreover, in view of the Office Memorandum of the Department of
Personnel and Training dated 18-3-1988 and 19-7-1989 the respondent was also to be
considered, otherwise a very incongruous situation would arise namely that the junior
will be considered for promotion but the senior will not.
12. In view of the above there is no merit in this appeal and it is dismissed.
Appeal dismissed.
AIR 2008 SUPREME COURT 861 "State of Gujarat v. Gajanand M. Dalwadi"
(From : Gujarat)*
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Civil Appeal No. 2322 of 2006, D/- 14 -12 -2007.
State of Gujarat v. Gajanand M. Dalwadi (D) by L.Rs.
(A) Constitution of India, Art.311 - TERMINATION OF SERVICE - MISCONDUCT -
FORGERY - SERVICE MATTERS - Dismissal from service - Misconduct - Delinquent
officer working in accounts Department and not in licence Department of Regional
Transport Office - Issuance of forged driving licence by him though it was not his
function - By itself a misconduct - Order dismissing him from service - Proper -
Misconduct, of such a magnitude, when proved, cannot be ignored on surmises and
conjectures - Equity, in a case of this nature, would have no role to play - Forgery of
licence cannot be condoned only because it has been done at instance of colleague, even
if it be so assumed.
L. P. A. No. 593 of 2004 in Spl. Civil Appln. No. 6283 of 2000, D/- 29-7-2004 (Guj.),
Reversed. (Paras 8, 9, 12)
(B) Constitution of India, Art.311 - TERMINATION OF SERVICE - LICENSE -
SERVICE MATTERS - Imposition of punishment - Proportionality - Delinquent officer
found guilty of issuance of forged driving licence - Order of dismissal /removal is
appropriate punishment.
2007 AIR SCW 7237, 2007 AIR SCW 4136, 2007 AIR SCW 3656, Foll. (Para 10)
Cases Referred : Chronological Paras
2007 AIR SCW 3656 : AIR 2007 SC 2129 (Foll.) 10
2007 AIR SCW 4136 : 2007 Lab IC 3266 : 2007 (5) ALJ 6 (Foll.) 10
2007 AIR SCW 7237 (Foll.) 10
Yashank Adhyaru, Sr. Advocate, Ms. Hemantika Wahi, with him for Appellant; H. K.
Puri, for Respondents.
* L. P. A. No. 593 of 2004 in Spl. Civ. Appln. No. 6283 of 2000, D/- 29-7-2004 (Guj.)
Judgement
S. B. SINHA, J. :-Gajanand M. Dalwadi, since deceased (delinquent officer) was working
in the Regional Transport Office under the Commissioner of Transport in the State of
Gujarat. He had been working in the Department for Grant of Licence. At the relevant
time, however, he was
@page-SC862
serving in the Accounts Department as a Summary Clerk.
2. An inspection was conducted in the Licence Branch of the Regional Transport Office
during the period 21.8.1995 to 13.9.1995.
3. Several misconducts committed by the delinquent officer came to the notice of the
authorities. It was found that a forged license was granted to one Narendra Kumar who
had met with an accident although at the relevant point of time, he was possessing a valid
driving licence. A chargesheet was issued against him. Upon holding a disciplinary
proceeding, the enquiry officer submitted a Report on 6.12.1997 stating that the charges
against him have been proved. The disciplinary authority directed his removal from
service by an Order dated 26.10.1998. Aggrieved by the said Order imposing punishment
upon him, he filed an application before the Gujarat Civil Services Tribunal. The said
application was allowed holding that misconduct on his part, if any, was committed by
him at the request of another clerk; viz. one Dudhrechia. It was further held;
"15. From the Department, it is submitted that Dudhrechia has denied entrusting the work
to appellant but as stated above Dudhrechia would never admit and the submission of
appellant gets credence that this is not an afterthought in the appeal but it was put to the
concerned clerk at the enquiry, at first in point of time.
16. Also the order is too harsh. The Disciplinary Authority must given reasons why it is
proper to pass such orders. In the Discipline Appeals and Rules providing for major
penalties step by step, the punishments are given with a view that penalty must be in
consonance with the act complained or charges proved or the misconduct of the staff. The
appellant is not a chip of dead wood that he must be removed. Also punishment such as
harsh as this would also required (sic) to consider rising an employment in the State. Not
that we want to protect dishonest or bad people but reasons must be given and
satisfaction must be reached that this punishment is proper."
4. A learned Single Judge of the said Court allowed the Writ Petition filed by the
appellant holding that the delinquent had all the opportunities to reply to the charge-sheet
and take part in the disciplinary proceeding. The learned Single Judge held that the
decision of the Tribunal resulted in miscarriage of justice warranting the Courts
intervention under the supervisory jurisdiction conferred upon the High Court under
Article 227 of the Constitution of India stating;
"It is evident that on the date when Driver Narendra Kumar met with the accident, he did
not possess a valid driving licence. In the circumstances the owner of the vehicle
Sugarmal Bherumal, could not have claimed insurance money for the damage caused to
the vehicle. With a view to facilitating the insurance claim, the said Sagarmal Bherumal
arranged for issuance of a duplicate licence in the name of driver-Narendra Kumar for the
period covering the date of the accident. Indisputably, the duplicate licence was issued by
the delinquent. Obviously, the duplicate licence was obtained by the owner Sagarmal
Bherumal with an intention to defraud the insurance Company. The delinquent played an
important role in this fraudulent scheme by issuing duplicate licence. Indisputably, it was
neither the function of the delinquent to issue such licence nor was it his defence that the
said licence was issued by him at the request of the concerned Clerk Shri Dudhrejia or
any other officer. Such defence was taken by the delinquent at a much later stage in the
disciplinary inquiry, though unsuccessfully.
It is quite possible that apart from the delinquent, there were other persons involved in the
aforesaid fraudulent scheme and a further inquiry could have revealed the names of the
other persons involved. However, merely because further inquiry was not made, the
delinquent cannot be exonerated even though by evidence on record the charge against
him has been proved.
As to the second charge, there is no denial by the delinquent that he had left certain
licence numbers blank while issuing the licence numbers. He has not even explained why
such blanks were maintained nor he has denied that the said blanks were maintained with
an ulterior intention to issue bogus licence at a later date. In absence of even a bare
denial, the charge has rightly been held to be proved by the disciplinary authority. The
fact that no licence was issued in the said numbers at any point of time thereafter is of no
consequence.
Even the third charge has been proved
@page-SC863
by the statement of the concerned persons i.e. Shri B.K. Chauhan and Shri N.P. Ptni. It
should also be noted that even in answer to the report of the inquiry officer, the
delinquent has not made out any case based on the evidence on record. Even the said
reply is evasive."
5. The Division Bench of the High Court, however, on an appeal preferred by the
delinquent officer, allowed the said appeal holding;
"Yes, the deceased Gajanand Dalwadi should have been more careful while preparing the
duplicate licence, he may have acted designedly. After all, he may not have understood
the nature of work and manner of transacting it since it was not his function since he was
working in the accounts. Therefore, the conclusions drawn by the Tribunal were justified
and there could be no reason to upturn them."
(Emphasis supplied)
6. Mr. Yashank Adhyaru, the learned senior counsel appearing on behalf of the appellant
submitted that the approach of the Division Bench of the High Court is wholly erroneous
and thus is liable to be set aside.
7. Mr. H.K. Puri, learned counsel appearing on behalf of the respondent, on the other
hand, would support the judgment.
8. Forgery of a licence is a serious charge. It cannot be condoned only because it has been
done at the instance of a colleague, even if it be so assumed. As noticed hereinbefore,
even the employee concerned has denied that the licence was issued at his instance.
9. The learned Tribunal as also the Division Bench of the High Court, with respect,
misdirected themselves in law, as they posed unto themselves wrong questions.
Misconduct, of such a magnitude, when proved, cannot be ignored on surmises and
conjectures. Equity, in a case of this nature, would have no role to play.
10

. When a forgery is committed with a view to assist a person to make unlawful gain for
himself or to cause unlawful loss to another, the matter should be viewed seriously. The
Tribunal is not an appellate authority, its jurisdiction was also limited. It could not have
ordinarily interfered with the quantum of punishment unless it was held to be wholly
disproportionate to the imputation of charges. If ordinarily in regard to the commission of
the offence of forgery, an Order of dismissal/removal is an appropriate punishment; as
has been held in a large number of cases, the same could not have been sidetracked. See
U.P.S.R.T.C. v. Ram Kishan Arora, [2007 (6) SCALE 721], Ramesh Chandra Sharma v.
Punjab National Bank and Anr. [2007(8) SCALE 240] and UCO Bank and Anr. v.
Rajinder Lal Capoor [(2007) 6 SCC 694]. 2007 AIR SCW 7237
2007 AIR SCW 4136
2007 AIR SCW 3656

11. The approach of the learned Single Judge, in our opinion was the correct one.
12. Once, it was held that the delinquent had acted designedly, it could not have also been
held that he might not have understood the nature of work or manner of transacting it,
since it was not his function as he had been working in the accounts. Finding of fact
arrived at by the Enquiry Officer which was accepted by the learned Single Judge, was
that the issuance of licence, which it was not his job, was itself a misconduct. The
Division Bench of the High Court clearly overlooked the fact that it is the positive case of
the State that the delinquent officer was working in the Licence Department prior to his
transfer to the Accounts Department and, therefore, he knew about the modalities of grant
of licence. An application for grant of licence must be processed having regard to the
provisions of the Central Motor Vehicles Rules. An application in Form 4 is required to
be filed as envisaged under Rule 14. Only, upon proper scrutiny thereof, a licence could
be granted in Form 6 as envisaged under Rule 16 of the Rules. Issuance of a forged
licence, having regard to the said provisions, is a serious matter, which could not have
been ignored on the ipse dixit of the Tribunal.
13. For the reasons aforementioned, the impugned Judgment cannot be sustained which is
set aside accordingly. Appeal is allowed. No costs.
Appeal dismissed.
AIR 2008 SUPREME COURT 863 "Govt. of Karnataka v. Gowramma"
(From : Karnataka)*
Coram : 2 Dr. A. PASAYAT AND P. SATHASIVAM, JJ.
Civil Appeal No. 2874 of 2001, D/- 14 -12 -2007.
Govt. of Karnataka and Ors. v. Gowramma and Ors. @page-SC864
(A) Constitution of India, Art.141 - PRECEDENT - Binding precedent - A decision is a
precedent on its own facts - Each case presents its own features - It is not everything said
by a Judge while giving a judgment that constitutes a precedent - Only thing in a Judge's
decision binding on a party is principle upon which case is decided.
According to the well-settled theory of procedents, every decision contains basic
postulates - (i)) findings of material facts, direct and inferential. An inferential finding of
facts is the inference which the Judge draws from the direct, or perceptible facts; (ii)
statements of the principles of law applicable to the legal problems disclosed by the facts;
and (iii) judgment based on the combined effect of the above. A decision is an authority
for what it actually decides. What is of the essence in a decision is its ratio and not every
observation found therein nor what logically flows from the various observations made in
the judgment. The enunciation of the reason or principle on which a question before a
Court has been decided is alone binding as a precedent.
AIR 1968 SC 647; 1996 AIR SCW 4020; (1901) AC 495 (HL)), Relied on. (Para
9)
(B) Constitution of India, Art.141 - PRECEDENT - Binding precedent - Circumstantial
flexibility, one additional or different fact may make a world of difference between
conclusions in two cases - Disposal of cases by blindly placing reliance on a decision is
not proper. (Para 12)
(C) INTERPRETATION OF STATUTES - Interpretation of Statutes - Judges interpret
statutes - They do not interpret judgments.
1970 (2) All ER 294; 1951 AC 737; (1971) 1 WLR 1062; 1972 (2) WLR 537, Rel. on.
(Para 10)
(D) Karnataka Preservation of Trees Act (76 of 1976), S.8 - TREES - Felling of trees -
Claim for value of trees - Plaintiffs, owners of trees, seeking permission for cutting and
felling of silver and jungle wood - Permission granted with condition to transport trees
after felling to Govt. warehouse - There was no challenge to stipulated conditions -
Admittedly trees in question were reserved trees - Order allowing claim of owners
without examining that trees were reserved trees - Not proper.
R. F. A. No. 816 of 1995, D/- 13-4-2000 (Kar), Reversed. (Para 14)
Cases Referred : Chronological Paras
1996 AIR SCW 4020 (Rel. on Pt.A) 9
(1972) 2 WLR 537 : (1972)1 All ER 749 (Rel. on) 11
(1971) 1 WLR 1062 (Rel. on)11
(1970) 2 All ER 294 : (1970)2 WLR 1140 (Rel. on) 11
AIR 1968 SC 647 (Rel. on Pt. A) 9
1951 AC 737 (Rel. on) 10
1901 AC 495 (HL) (Rel. on)) 9
Sanjay R. Hegde and Amit Kr. Chawla, for Appellants; S. N. Bhat, N. P. S. Panwar and
D. P. Chaturvedi, for Respondents.
* R. F. A. No. 816 of 1995, D/- 13-4-2000 (Kant).
Judgement
Dr. ARIJIT PASAYAT, J. :-Heard learned counsel for the parties.
2. Challenge in this appeal is to the judgment of a learned Single Judge of the Karnataka
High Court allowing the appeal filed by the respondents.
3. Plaintiffs, who are the respondents in the present appeal filed a Suit for recovery of a
sum of Rs.1,47,965.20 on the ground that being owners of the Trees which were
transported to the Government godown on the basis of the permission granted by the
present appellants, the value of the Trees has to be paid by the government.
4. The case of the plaintiff, as culled out from the averments in the plaint is that they are
the owners of the suit schedule property. The plaintiffs and their predecessor had grown
silver wood, jungle wood and other varieties of trees in the schedule land by spending lot
of money and had cultivated the said land with coffee crop. In order to regulate the shade
in the schedule property and also for cutting and felling of silver wood, jungle wood and
other trees, the plaintiffs had applied for permission for cutting and felling of the silver
wood, jungle wood and other trees. Before granting the felling permission of the said
trees, a joint survey was carried out by the forest authorities as well as the revenue
surveyors. Thereafter, the second defendant granted permission for felling of the trees
situated in the schedule properties. In terms of the permission, the plaintiffs cut and felled
the trees. While issuing the transport permit to the plaintiffs,
@page-SC865
the second defendant had directed issuance of transport permit for a portion of the trees
and ordered to transfer 1050 CFT of timber valued at Rs.1,31,250/- to an earmarked
forest depot. The firewood of 22-1/2 meters valued at Rs.10,000/- was also transported to
the same depot. Therefore, the claim was made that the plaintiffs are entitled to the value
of the Timber @ Rs.125/- per CFT and at Rs.150/- per CFT at the prevailing rates.
Defendants took the stand that the permission was conditional and there was never any
challenge to the conditional permission granted. After having accepted the permission
with the conditions stipulated, it was not open to the plaintiffs to lay a claim for the value
of the trees. The Trial Judge dismissed the Suit, inter alia, holding that in the absence of a
challenge to the conditional permission, there was no question of the plaintiff's making a
claim for value of the timber transported.
5. An appeal was filed before the High Court, which, by the impugned judgment,
accepted the stand of the plaintiffs. For granting relief to the plaintiffs, i.e. the present
respondents, reliance was placed on certain judgments of the High Court where it was
held that in respect of reserved trees, the ownership was not with the Government but was
with the owner of the land. Accordingly, as noted above, the appeal was allowed.
6. In support of the appeal, learned counsel for the appellant-State submitted that the
grant of permission was governed by the Karnataka Preservation of Trees Act, 1976 (in
short the Act'). Permission is required for felling of all trees irrespective of whether they
are situated in private or in government land. The permission undisputedly is subject to
the stipulated conditions. There is a provision for preferring an appeal in case of refusal
to grant permission. The permission was granted on 30.3.1999 and there was a specific
condition which stipulated that 27 trees of a particular variety which are reserved trees
are to be transported to the Government Nata Warehouse after felling. There was no
challenge to the order in this regard. Since the conditions were not challenged, the High
Court should not have granted relief to the respondents-plaintiffs relying on certain
decisions which were rendered in different context and had no application to the facts of
the present case.
7. Learned counsel for the respondents, on the other hand, submitted that merely because
the trees which were permitted to be cut were reserved trees, that did not mean that
government was the owner of the trees. Reference is made to certain provisions of the
Karnataka Forest Act, 1963 to contend that the ownership of the Government in respect
of the trees is restricted only to sandalwood trees.
8. It is an admitted position that the permission was granted with conditions. It is also not
disputed that PW-l, who was examined in support of the plaintiffs's case, accepted that
the trees in question were reserved trees. The Trial Court took note of this fact and noted
that in the cross-examination of PW-1, he has specifically admitted that the Nandi trees
are reserved trees. Further, the High Court lightly brushed aside the stand of the State and
its functionaries that in the absence of any challenge to the conditions stipulated in the
permission granted, it was not open to the plaintiffs to claim value of the Timber. The
High Court, in the impugned judgment, referred to some judgments rendered in writ
petitions.
9

. Reliance on the decision without looking into the factual background of the case before
it is clearly impermissible. A decision is a precedent on its own facts. Each case presents
its own features. It is not everything said by a Judge while giving a judgment that
constitutes a precedent. The only thing in a Judges decision binding a party is the
principle upon which the case is decided and for this reason it is important to analyse a
decision and isolate from it the ratio decidendi. According to the well-settled theory of
precedents, every decision contains three basic postulates (i) findings of material facts,
direct and inferential. An inferential finding of facts is the inference which the Judge
draws from the direct, or perceptible facts; (ii) statements of the principles of law
applicable to the legal problems disclosed by the facts; and (iii) judgment based on the
combined effect of the above. A decision is an authority for what it actually decides.
What is of the essence in a decision is its ratio and not every observation found therein
nor what logically flows from the various observations made in the judgment. The
enunciation of the reason or principle on which a question before a Court has been
decided is alone binding as a precedent. (See: State of Orissa v. Sudhansu Sekhar Misra
1996 AIR SCW 4020

@page-SC866
and Ors. (AIR 1968 SC 647) and Union of India and Ors. v. Dhanwanti Devi and Ors.
(1996 (6) SCC 44). A case is a precedent and binding for what it explicitly decides and no
more. The words used by Judges in their judgments are not to be read as if they are words
in Act of Parliament. In Quinn v. Leathem (1901) AC 495 (H.L.). Earl of Halsbury LC
observed that every judgment must be read as applicable to the particular facts proved or
assumed to be proved, since the generality of the expressions which are found there are
not intended to be exposition of the whole law but governed and qualified by the
particular facts of the case in which such expressions are found and a case is only an
authority for what it actually decides.
10. Courts should not place reliance on decisions without discussing as to how the factual
situation fits in with the fact situation of the decision on which reliance is placed.
Observations of Courts are neither to be read as Euclids theorems nor as provisions of the
statute and that too taken out of their context. These observations must be read in the
context in which they appear to have been stated. Judgments of Courts are not to be
construed as statutes. To interpret words, phrases and provisions of a statute, it may
become necessary for Judges to embark into lengthy discussions but the discussion is
meant to explain and not to define. Judges interpret statutes, they do not interpret
judgments. They interpret words of statutes; their words are not to be interpreted as
statutes. In London Graving Dock Co. Ltd. V. Horton (1951 AC 737 at p.761), Lord Mac
Dermot observed :
The matter cannot, of course, be settled merely by treating the ipsissima vertra of Willes,
J as though they were part of an Act of Parliament and applying the rules of interpretation
appropriate thereto. This is not to detract from the great weight to be given to the
language actually used by that most distinguished Judge.
11. In Home Office v. Dorset Yacht Co. (1970 (2) All ER 294) Lord Reid said, "Lord
Atkins speech.....is not to be treated as if it was a statute definition. It will require
qualification in new circumstances. Megarry, J in (1971) 1 WLR 1062 observed: One
must not, of course, construe even a reserved judgment of Russell L.J. as if it were an Act
of Parliament". And, in Herrington v. British Railways Board (1972 (2) WLR 537) Lord
Morris said:
There is always peril in treating the words of a speech or judgment as though they are
words in a legislative enactment, and it is to be remembered that judicial utterances made
in the setting of the facts of a particular case.
12. Circumstantial flexibility, one additional or different fact may make a world of
difference between conclusions in two cases. Disposal of cases by blindly placing
reliance on a decision is not proper.
13. The following words of Lord Denning in the matter of applying precedents have
become locus classicus:
"Each case depends on its own facts and a close similarity between one case and another
is not enough because even a single significant detail may alter the entire aspect, in
deciding such cases, one should avoid the temptation to decide cases (as said by
Cordozo) by matching the colour of one case against the colour of another. To decide
therefore, on which side of the line a case falls, the broad resemblance to another case is
not at all decisive."
*** *** ***
"Precedent should be followed only so far as it marks the path of justice, but you must cut
the dead wood and trim off the side branches else you will find yourself lost in thickets
and branches. My plea is to keep the path to justice clear of obstructions which could
impede it."
14.As noted above, there was no challenge to the conditions stipulated and it was
accepted that the trees were reserved trees. What is the effect of this admission, was not
examined by the High Court. Therefore, looked at from any angle, the judgment of the
High Court is clearly unsustainable and is set aside. The appeal is allowed but without
any order as to costs.
Appeal allowed.
@page-SC867
AIR 2008 SUPREME COURT 867 "Hari Yadav v. State of Bihar"
(From : Patna)
Coram : 2 S. B. SINHA AND H. S. BEDI, JJ.
Criminal Appeal No. 1721 of 2007 (arising out of SLP (Cri.) No. 5256 of 2007), D/- 14
-12 -2007.
Hari Yadav v. State of Bihar.
(A) Penal Code (45 of 1860), S.300 - MURDER - ASSAULT - LIFE IMPRISONMENT -
Murderous assault - Proof - Accused persons allegedly assaulted deceased - Witnesses
stated in details about role played by appellant in inflicting farsa blow and mode and
manner of incident - Presence of appellant at scene of incidence was beyond any dispute -
Autopsy surgeon opined that injury was sufficient in ordinary course of nature to cause
death - Merely because there is possibility of injury being caused by hard and blunt
substance, same by itself cannot be a ground for holding that ocular evidence should be
disbelieved - It was not a case where there was a sudden fight - Accused came prepared at
place of occurrence - Conviction of appellant under S. 302 and sentence of life
imprisonment, proper.
2006 (9) Scale 681, Relied on. (Paras 12, 18, 20, 21, 23)
(B) Criminal P.C. (2 of 1974), S.172 - INVESTIGATION - Case diary - Slip attached to
injury report which formed part of case diary - Reliance on note made in slip - Without
proof of such document and without drawing attention of investigating officer towards it
- Improper. (Para 18)
Cases Referred : Chronological Paras
2006 (9) Scale 681 (Rel. on, Pnt. A) 20, 22
AIR 1958 SC 465 22
Sushil Kumar, Sr. Advocate, Vijay Kumar and Vishwajit Singh, for Appellant; Gopal
Singh, for Respondent.
Judgement
S. B. SINHA, J. :-Leave granted.
1. Appellant is before us aggrieved by and dissatisfied with a judgment dated 21st
January, 2004 passed by a Division Bench of the Patna High Court in Criminal Appeal
No. 341 of 1991 arising out of the judgment of conviction and sentence dated 2nd
September, 1991 passed by Additional District and Sessions Judge XIth, Gaya, in
Sessions Trial No. 12 of 1991.
2. A land dispute arose between the accused and the prosecution witnesses in relation to a
piece of land bearing plot No. 1/555 of village Gamahariya. While measurement of the
said land was going on, both the parties, viz., Kameshwar Yadav and Chander Dusadh,
claimed their right thereupon, on the basis of purchases made by them under their
respective registered deeds of sale.
3. A quarrel ensued between both the parties. Kameshwar Yadav exhorted others to
eliminate Chander Dusadh. It was followed by an assault on Kali Dusadh by a hard and
blunt object by him. Jaldhari Yadav assaulted Kali Dusadh on his right arm. Parmeshwar
Yadav assaulted him on his back. Appellant herein inflicted a farsa blow on the head of
Chander Dusadh, the deceased. Kameshwar Yadav gave another blow on his hand by a
hard and blunt object. As alarm was raised by Kali Dusadh, whereupon assailants fled
from the field. They allegedly resorted to firing also.
4. Thereafter, injured Chander Dusadh was taken to the Police Station in an unconscious
state.
5. A First Information Report in regard to the said incident was lodged at 10 pm on 11th
August, 1981. Appellant amongst others was named therein. The prosecution during trial
examined a number of witnesses in support of its case. PW 1, Bisu Bhuiya categorically
stated about infliction of garassa blow by Hari Yadav and lathi blow by Kameshwar
Yadav on the deceased. Role played by Kameshwar Yadav, Kishun Yadav, Hari Yadav,
Parmeshwar Yadav, Bhuja Yadav, Rohan Yadav and Gopal Yadav in inflicting injuries on
Kali Dusadh were also categorically stated by him in his deposition.
6. Similarly, Barat Dusadh (PW 3) deposed about the role played by the Appellant in
inflicting a farsa blow on the head of Chander Dusadh, having been exhorted to do so by
his father. He not only stated in details in regard to the mode and manner in which the
incident took place but also the cause thereof. Similar is the evidence of Aminullah Khan
(PW 5) and Gazi Khijer Heyat (PW 6).
7. P.W. 8 Dr. M.K. Sinha, who conducted the post mortem examination on the dead body
of the deceased, in his report noticed three ante mortem injuries which are as under:
"(i) Recently healed linear wound of
@page-SC868
length 4" over top of head. On dissection underlined tissues were found infiltrated with
blackish blood clot. There was fracture of both parietal bones. On removal of skull cap,
there was presence of extradural and subdural haematoma over superior surface of both
cerebral hemisphere. Brain and meninges were found grossly congested.
(ii) Healed abrasion over front of lower on part of the right knee with presence of dry,
black scale over the area, size 1-1/4' x ½'.
(iii) Swelling over antero lateral aspect of right arm upper part size 2-1/2" circumference.
"
8. On analyzing the materials brought on records, the Learned Sessions Judge found the
appellant guilty of commission of offence under Section 302 of the Indian Penal Code.
The Learned Judge, however, while considering the facts and circumstances of each of
the accused at the time of occurrence imposed a sentence of ten years' rigorous
imprisonment under Section 302 of the Indian Penal Code to accused Kameshwar Yadav
and Hari Yadav and one year's rigorous imprisonment to Jaldhari Yadav and Parmeshwar
Yadav and Kameshwar Yadav under Section 323 of the Indian Penal Code.
9. Three Criminal Appeals were preferred by the accused persons. The High Court
dismissed the said appeals, but keeping in view the fact that the Learned Sessions Judge
committed a serious error in imposing the punishment of 10 year's rigorous imprisonment
for commission of an offence under Section 302 of the Indian Penal Code, imposed the
sentence of rigorous imprisonment for life. Appellant is, thus, before us.
10. Mr. Sushil Kumar, learned Senior Counsel appearing on behalf of the appellant, inter
alia, would submit that the occurrence having taken place on 11.8.1981 and the death of
deceased having taken place on 1.9.1981, the appellant cannot be stated to have
committed any offence under Section 302. It was pointed that according to the Doctor,
the deceased left the hospital on 27.8.1981 without his permission and thus he might have
died of some other disease in between the period 27.8.1981 and 1.9.1981. The Learned
Counsel submitted that keeping in view the injuries suffered by the deceased, the same
were possibly caused by a lathi.
11. Mr. Gopal Singh, learned counsel appearing on behalf of the State on the other hand,
supported the impugned judgment.
12. Presence of the appellant at the scene of the incidence is beyond any dispute. The
autopsy surgeon in his evidence while proving his report, identified three injuries
appearing on the person of the deceased. Injury No. 1 was found to be grievous in nature
and dangerous to life which was likely to be caused by sharp weapon such as farsa
whereas other injuries which were simple in nature could have been caused by hard and
blunt object (may be lathi). He was of the categorical opinion that the injury No.1, in
ordinary course of nature, was sufficient to cause death.
13. In cross examination his attention was drawn to the book "Modi's Medical
Jurisprudence and Toxicology (22nd Edition)". In answer to a question, he stated: Linear
abrasion can be possible by lathi as well. Volunteers it can also be caused by sharp
weapon. If the margin of the wound is sharp, it is inferred that it was caused by sharp
weapon.
14. We may notice that it was categorically stated by the said witness that there was no
provision for treatment of such injury and such cases are ordinarily referred to neuro
surgeon at Ranchi.
15. It appears that on 27.8.1981, a report was sent that deceased died in Gaya hospital on
1.9.1981.
16. Our attention has been drawn to one slip attached to the said report wherein a prayer
was made for insertion of Section 302 of Indian Penal Code in the said case, which reads
as under:
In continuation of Injury Report of Chandra Gorait of Singh Pokhar, Sherghati I have to
inform you that he has developed unomiplagia and he left the hospital on 27.8.1981
without the knowledge of undersigned. He has not submitted x-ray of right hand till now.
This is for information and necessary action."
17. Submission of the learned senior counsel Sh. Sushil Kumar is that the deceased left
hospital on 27.8.1981 without any information to the doctor therefore, cannot be
accepted. The fact that the deceased died in the District Hospital is not in dispute. We
have noticed hereinbefore that the Doctor himself suggested that there was no provision
for treatment of such patients at Sherghatti. Evidently, therefore,
@page-SC869
the relatives of the deceased took him to the District Hospital for better treatment. For the
said purpose, the consent of the doctor might not have been taken or brought to the
personal knowledge of the doctor concerned.
18. It is, however, significant that the aforementioned quotation was made from the
purported note made by somebody which formed part of the case diary. The said
document was not proved. Attention of the investigating officer was not drawn thereto.
No such question appears to have been raised before the High court. We are really at a
loss to understand as to how reliance has been placed thereupon on the basis of a piece of
paper which appeared in the case diary. We deprecate such a practice.
It may be of some interest to notice that Dr. S.P. Gupta has used the word unomiplagia.
We have not been able to find what it means in the medical dictionary.
19. Deposition of Dr. S.P. Gupta who was examined before the Learned Sessions Judge as
PW 10 has not been brought on record by the appellants. The reason therefor appears to
us as obvious. Several unsustainable pleas have been raised before the Trial Court on
behalf of the appellant. It appears that at one point of time a plea of insanity has as also
his having no relationship with the other accused, had also been taken. It appears from
the records that he had also absconded for some time.
20. Submission of Mr. Sushil Kumar that such an injury can be caused by hard and blunt
substance may be correct in view of the statements made by the autopsy surgeon but
merely because there is a possibility in regard thereto, the same by itself cannot be a
ground for holding that ocular evidence should be disbelieved. There are a large number
of authorities of this Court which clearly show that in certain situations, the wound
produced by a blunt instrument may similarly seem to be an incised one. [See Kailash v.
State of MP, 2006 (9) SCALE 681].
21. It was not a case where there was a sudden fight. The accused came prepared at the
place of occurrence. An altercation might have taken place but not only repeated assaults
were made, other witnesses also suffered injuries.
22. Each case must be decided on its own facts as has been held in Kailash (supra).

The law in this regard was laid down in Kailash (supra) in the following terms: In Virsa
Singh v. The State of Punjab [1958 SCR 1495] wherein Vivian Bose, J. opined that
infliction of one injury by accused may be sufficient to hold him guilty for commission of
an offence under Section 302 of the Indian Penal Code stating : AIR 1958 SC 465

In considering whether the intention was to inflict the injury found to have been inflicted,
the enquiry necessarily proceeds on broad lines as, for example, whether there was an
intention to strike at a vital or a dangerous spot, and whether with sufficient force to
cause the kind of injury found to have been inflicted. It is, of course, not necessary to
enquire into every last detail as, for instance, whether the prisoner intended to have the
bowels fall out, or whether he intended to penetrate the liver or the kidneys or the heart.
Otherwise, a man who has no knowledge of anatomy could never be convict, for, if he
does not know that there is a heart or a kidney or bowels, he cannot be said to have
intended to injure them. Of course, that is not the kind of enquiry. It is broad-based and
simple and based on commonsense; the kind of enquiry that twelve good men and true
could readily appreciate and understand.
To put it shortly, the prosecution must prove the following facts before it can bring a case
under Section 300. First, it must establish, quite objectively, that a bodily injury is
present;
Secondly, the nature of the injury must be proved; These are purely objective
investigations.
Thirdly, it must be proved that there was an intention to inflict that particular bodily
injury, that is to say, that it was not accidental or unintentional, or that some other kind of
injury was intended.
Once these three elements are proved to present, the enquiry proceeds further and,
Fourthly, it must be proved that the injury of the type just described made up of the three
elements set out above is
@page-SC870
sufficient to cause death in the ordinary course of nature. This part of the enquiry is
purely objective and inferential and has nothing to do with the intention of the offender.
23. For the reasons aforementioned, there is no merit in this appeal, which accordingly is
dismissed.
Appeal dismissed.

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