RADHAKANTA DEB & ANR.

COMMISSIONER OF HINDU RELIGIOUS ENDOWMENTS,

ORI SSA

February 13, 1981

[S. MuRTAZA FAZAL Au, A. VARADARAJAN AND A. N. SnN, JJ.]

Private v. Public endowments-Tests to deiennine on the facts of cacfi ca5e whether an endowment is of a private or oJ a public nature, explained.

Allowing the appeal by ce11ificate, the Court

HELD : The tests which provide sufficient guidelines to determine on the facts of each case whether an endowment is of a private or of a pubiic nature are : ( 1) Where the origin of the endowment cannot be ascertained, the ques tion whether the user of the temple by members of the public is as of right; (2) The fact that the control and management vests either in a lnrge body of persons or in the members of the public and the founder does not retain any control over the management. Allied to this may be a circumstance where the evidence shows that there is provision for a scheme to be framed by associating the members of the public at large; (3) Where, however, a document is available to prove the nature and origin of the endowment and t'he recitals of the document show that the control and management of the temple is retained with the founder or his descendants, and that extensive properties ore dedicated for the purpose of the maintenance of the temple belonging to the founder himself, this will be a conclusive proof to show that the endowment was of a private nature; ( 4) Where the evidence shows that the founder of the endowment did not make any stipulation for offerings or contributions to be made by members of the public to the temple, this would be an important intrinsic circumstance to indicate the private nature of the endowment. [833 A-El

Deoki Nandan v. Murlidhar, [1956] SCR 756; Mahant Ram Saroop Dasji

v. S. P. Salli, Special Officer-inCharge of the Hindu Religious Trusts & Ors., [1959] 2 Supp. SCR 583; Narayan Bhagwantrao Gosavi Ba/ajiwale v.

Gopal Vinayak Gosavi & Ors., [1960] 1 SCR 773; Bihar State Board Religious Trust, Patna v. Mahant Sri Biseshwar Das, [1971] 3 SCR 680, Dhaneshwarbuwa Guru Purshottambuwa Owner of Shri Vithal Rukhamai Sansthan v. The Charity Com1nissioner, State of Bombay, [1976] 3 SCR 518; Gurpur Guni Venkataraya Narasltima Prabhu & Ors. v. B. G. Achia, Assistant Commissioner, lli11du Endowment Mangalore & Anr., [1977] 3 SCC 17, followed.

In the instant case : (i) Ex. A. an ancient document executed as far back as February 18, 1895, the authenticity and the genuineness of which is beyond question, clearly and conclusively show that the endowment was of a private nature and the intention of the founder was merely to inste.l a famtly deity in the temple. (ii) The fact that the temple was of a massive structure of about 25 yards in height, by itself, divorced from other things, could not prove that the temple was a public one. (iii) The Shebaits or the Marfatdars were appointed by the founders of the. endowment and the entire management and control of the ten1ple \v<tS retained by the family.

(iv) The fact t'hat b'1ogs

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were offered during the day which \\-US in consonance with the rules observed A by the public is not of much consequence because bhogs are offered even in private temples.

(v) aause 15 merely provides that if in future the family becomes extinct and no fit person could be found then any of the Baisnab Sarnpraday or any reputed Hindu of the village could take action, namely, to perform the work of the deity. This was a contingent provision and here also the founders did not confer the duty of performing all the work on the 1nembers of the public but they chose or selected only a particular person belonging B to a particular community which also shows that even if the fan1ily was to become extinct, the private nature of the endowment was not to be changed.

Indeed if the intention was to instal the idol in the temple by way of a public endowment, clause. 14 would have clearly provided that in cnse the family become extinct the members of the public or of the brotherhood or the Government could have taken over the management.

On the other hand, the interpretation of the various clauses of the documents clearly shows that suffi C cient care has been taken by the Pani family to see that the dedication to the family deity is not changed even if the family becomes extinct. [833 H, 834 A, 838 G-H, 839 C, E-H, 840 A-Bl

Cxv1L APPELLATE JURISDICTION: Civil Appeal No. 318 of 1970.

From the Judgment and Decree dated 31-7-1969 of the Orissa High Court in Appeal from Original Decree No. 78/58.

P. K. Chatterjee and Rathin Dass for the Appellant.

G. S. Chatterjee for the Respondent. • The Judgment of the Court was delivered by

FAZAL Ar.1, J. This appeal by certificate granted under Art. 133 of the Constitution is directed against a Division Bench judgment dated July 31, 1969 of the Orissa High Court and arises in the following circumstances.

The appellants-plaintiffs had instituted a suit under s. 62 (2) of the Orissa Religious Endowment Act, 1939 (Act No. 4 of 1939) (hereinafter referred to as the 'Act') (this Act applies only to public endowments) to set aside the order dated 4-8-1950 of the respondentdefendant by which the temple of the appellants, whose deity was Radhakanta Deb, was declared to be a public temple and a trust and the endowment was held to be of a, public nature and, therefore, was to be governed by the Act. The Subordinate Judge decreed the appellants-plaintifis suit holding that the deity installed iu the temple was a family deity of the Pani family and the endowment being of a private nature, the Act had no application anrl the Order passed by the respondent regarding the management was set aside.

The Respondent (Commissioner of Hindu Religious Endowments, Orissa) filed an appeal in the High Court against the decision of the

Subordinate Judge which was heard by the Division Bench referred to above. The High Court reversed the decision of the Subordinate Judge and held that the temple and the deity installed therein being a public endowment fell within the four corners of the Act and the respondent was fully entitled to pass orders for its management.

Hence, this appeal by certificate before us.

The sole question that falls for determination in this appeal is as to whether or not the appellant-temple was a public endowment as alleged by the respondent or a family deity as alleged by the appellant.

The learned counsel for the appellants, P. K. Chatterjee, has submitted that the approach made by the High Court was wholly incorrect and it has misconstrued the evidence and documents produced in the case to show that the endowment was a private one and the deity installed in the temple was purely a family deity having nothing to do with the public.

The learned counsel for the respondent, however, supported the judgment of the High Court thaf the endowment was of a public nature.

The concept of a private endowment or a private trust is unknown to English law where all trusts are public trusts of a purely charitable and religious nature.

Thus, under the English law what is a public trust is only a form of Cla-itable Trust. Dr. Mukherjee in his Tagore Law Lectures on the Hindu Law of Religious and Charitable Trusts (1952 Edition) has pointed out that in English law the Crown is the constitutional protector of all properties subject to charitable trusts as these trusts are essentially matters of public concern. The learned author has further pointed out that one fundamental distinction between English and Indian law lies in the fact that there can be religious trust of a private character under the Hindu law which is not possible in English law. It is well settled that under the Hindu Iliw, however, it is not only permissible but also very common to have private endowments which though are meant for charitable purposes yet fhe dominant intention of the founder is to instal a family deity in the temple and worship the same in order to effectuate the spiritual benefit to the family of the founders and his descendants and to perpetuate the memory of the founder.

In such cases, the property does not vest in God but in the beneficiaries who have installed the deity. In other words, the beneficiaries in a public trust are the general public or a section of the same and not a determinate body of individuals as a result of which the remedies for enforcement of charitable trust are somewhat different from those which can be availed of by beneficiaries in a private trust.

The members of the public may not be debarred

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from entering the temple and worshipping the deity but their entry into the temple is not as of right. This is one of the cardinal tests of a private endowment.

Similarly, even the Mahomedan law recognises the existence of a private trust which is also of a charitable nature and which is generally called Waqf-allal-Aulad, where the ultimate benefit is reserved to God but the property vests in the beneficiaries and the income from the property is used for the maintenance and support of the family of the founder and his descendants. In case the family becomes extinct then the Waqf becomes a public waqf, the property vesting in God.

A public Waqf under the Mahomedan law is called Waqf-fi-sabi-lil-lah.

The question as to whether the religious endowment is of a private nature or of a public nature has to be decided with reference to the facts proved in each case and it is difficult to lay down any test or tests which may be of universal application. It is manifest that where the endowment is lost in antiquity or shrouded in mystery, there being no document or revenue entry to prove its origin, the task of the court becomes diilicult and it has to rely merely on circumstantial evidence regarding the nature of the user of the temple. In the instant case, however, as there are two documents which clearly show the nature of the endowment, our task is rendered easier. It is well settled that the issue whether a religious endowment is a public or a private one must depend on the application of legal concept of a deity and private endowment, as may appear from the facts proved in each case. The essential distinction between a private and a public endowment is that whereas in the former the beneficiaries are specified individuals, in the latter they are the general public or class of unascertained people. This doctrine is well-known and has been accepted by the Privy Council as also by this Court in a large catena of authorities. This being the essential distinction between the nature of a public or a private endowment, it follows that one of the crucial tests to determine the nature of the endowment would be to find out if the management of the property dedicated is in the hands of the strangers or members of the public or in the hands of the founders or their descendants.

Other factors that may be considered would be the nature of right of the worshippers, that is to say, whether the right to worship in the temple is exercised as of right and not as a matter of concession. This will be the strongest possible circumstance to indicate that the endowment was a public one and the beneficiaries are the worshippers and not particular family. After all, an idol is a juristic person capable of holding property and the property dedicated to the temple vests in the deity. If the main worshippers are the members of the public who worship as a matter of right then the real purpose is to confer benefit on God.

Some of the circumstances from which a public endowment can be inferred may be whether an endowment is made by a person who has

110 issue and who after installing the deity entrusts the management to members of the public or strangers which is a clear proof of the intention to dedicate the temple to public and not to the members of the

8 family. Where, however, it is proved that the intention of the testator or the founder was to dedicate the temple merely for the benefit of the members of the family or their descendants, the endowment would be of a private nature.

The mere fact that members of the public are allowed to worship by itself would not make an endowment public unless it is proved that the members of the public had a right to worship in the temple. In Deoki Nandan v. Murlidhar(') this Court observed as follows :-

"The distinction between a private and a public trust is that whereas in the former the beneciaries are specific individuals, in the latter they are the general public or a class D thereof.

While in the former the beneficiaries are persons who are ascertained or capable of being ascertained, in the latter they constitute a body which is incapable of ascertainment.

The cardinal point to be decided is whether it was the intention of the founder that specified individuals are to have the right of worship at the shrine, or the general public or any specified portion thereof. In accordance with this theory, it has been held that when property is dedicated for the worship of a family idol, it is a private and not a public endowment, as the persons who are entitled to worship at the shrine of the deity can only be the members of the family, and that is an ascertainql group of individuals. But where the beneficiaries are not members of a family or a specified individual, then the endowment can only be regarded as public, intended to benefit the general body of worshippers." (Emphasis supplied)

This view was reiterated in a later decision of this Court in Mahant Ram Saroop Dasji v. S. P. Sahi, Special Officer-In-Charge of the Hindu Religious Trusts & Ors.(2) where S. K. Das, J. as he then was, speak- H ing for the Court clarified the law thus :

(1) [1956] S.C.R. 756.

(2) [1959] 2 Supp. S.C.R. 583.

...

"But the most usual and commonest fonn of a private A religious trust is one created for the worship of a family idol ln which the public are not interested ...... Dealing with

th(\ distinction between public and private endowments ln Hindu law, Sir Dinshah Mulla has said at p. 529 of his principles of Hindu Law (!Ith edition)

'Religious endowments are either public or private. In a public endowment the dedication is for the use or benefit of the public.

When property is set apart for the worship of a family god in which the public are not interested the endowments is a private one'."

In Narayan Bhagwantrao Gosavi Ba/ajiwale v.

Gopal Vinayak Gosavi & Ors.(') the same principles were reiterated and it was pointed out that the entries made in the Inam Register showing the nature of the endowment were entitled to great weight and taken with the vastness of the temple, the mode of its construction, the long user by the public as of right and grants by Rulers and other persons were clear pointers to the fact that the endowment was of a public nature.

In the case of Bihar State Board Religious Trust, Patna v. Mahant Sri Biseshwar Das,(') this Court laid down some important tests to detennine the nature of the endowment.

In this connection, the folc

lowing observations need specific mention :- E

"Therefore, evidence that sadhus and other persons visiting the temple are given food and shelter is not by itself indicative of the temple being a public temple or its properties being subject to a public trust.

Evidence that the mahants used to celebrate Hlndn festivals when members of the public used to attend the temple and give offerings and that the public were admitted to the temple for darshan and worship is also not indicative of the temple being one for the benefit of the public .... The fact that members of the public used to come to !he temple without any hindrance also does not necessarily mean that the temple is a public temple, for members of the public do attend private temples. . ... Yet, the Privy Council held that the general effect of the evidence was that the lamily had treated the temple as family property and !he mete fact of the members of the public having come to the temple and having made offerings and the mela having been held which

(I) [1960] 1 S.C.R. 773

(2) [1971]3 S.C.R.680

A gave popularity to the temple and increased its esteem in the eyes of the public and the fact that they were never turned away were not enough to hold the temple and the properties as a public trust.

Thus, the mere fact of the public having been freely admitted to that temple cannot mean that courtbs should readily infer therefrom dedication to the public. The value of such public user as evidence of dedication depends on the circumstances which give strength to the inference that the user was as of right."

It may thus be noticed that this Court has invariably held that the mere fact that the members of the public used to visit the temple for the purpose of worship without any hindrance or freely admitted therein would not be a clear indication of the nature of the endowment. It is manifest that whenever a dedication is made for religious purposes and a deity installed in a temple, the worship of the deity is a necessary concomitant of the installation of the deity, and therefore, the mere factum of worship would not determine the nature of the endowment. Indeed if it is proved that the worship by the members of the public is as of right that may be a circumstance which may in some cases conclusively establish that the endowment was of a public nature. In Dhaneshwarbuwa Guru Purshottambuwa Owner of Shri Vithal Rukhamai Sansthan v. The Charity Commissioner State of Bombay(') all the aforesaid cases were summarised and the principles indicated above were reiterated.

In Gurpur Guni Venkataraya Narashima Prabhu & Ors. v. B. G.

Achin, Assistant Commissioner, Hindu Endowment, Mangalore & Anr.( 2) Krishna Iyer, J., reiterated these very principles in the following words :

"The Jaw is now well settled that 'the mere fact of the public having been freely admitted to the temple cannot mean that courts should readily infer therefrom dedication to the public. The value of such public user as evidence of dedication depends on the circumstances which give strength to the inference that the user was as of right'. (See Bihar State Board Religious Trust, Patna v. Mahant Sri Biseshwar Das-[1971] 3 SCR 680, 689)."

(2) [1977) 3 s.c.c. 17

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Thus, on a conspectus of the authorities mentioned above, the A following tests may be !aid down as providing sufficient guidelines to determine on the facts of each case whether an endowment is of a private or of a public nature :

( !) Where the origin of the endowment cannot be ascertained,

the question whether the user of the temple by members B of the public is as of right;

(2) Tue fact that the control and management vests either in a large body of persons or in the members of the public and the founder does not retain any control over the management. Allied to this may be a circumstance where the evidence shows that there is provision for a C scheme to be framed by associating the members of the pnbllc at large;

(3) Where, however, a document is available to prove the nature and origin of the endowment and the recitals of the document show that the control and management of the D temple is retained with the founder or his descendants, and that extensive properties are dedicated for the purpose of the maintenance of the temple belonging to the founder himself, this will be a conclusive proof to show that the endowment was of a private nature.

( 4) Where the evidence shows that the founder of the E endowment did not make any stipulation for offerings or contributions to be made by members of the public to the temple, this would be an important intrinsic circumstance to indicate the private nature of the endowment.

Fortunately, in this case there are two important documents Ext.

F ,,; A and Ext. 1-from which the nature of the endowment can be clearly spelt out and we would examine these documents in the light of the tests and the principles enunciated above because after going through the judgment of the High Court we are satisfied that the High Court has not properly construed some of the important features contained in the documents and the evidence and has in fact overlooked certain important aspects which completely negative the fact that the endowment was of a public nature.

Ext. A is an ancient document executed as far back as February 18, 1895.

The authenticity and the genuineness of this document is beyond question and the High Court itself has described this document as a document which has created the present endowment.

Even though the document may not be treated. as having itself

6-214 SCI/81

A created the endowment bnt it gives clear indlcation that the endow ment was created near about the date when this document was exe cuted. Some of the extracts of this document which are nndisputed, in our opinion, clearly and conclusively show that the endowment was of a private nature and the intention of the founder was merely

to instal a family deity in the temple. In order to fortify our conclusions, it may be necessary to give certain important recitals from this document which may be extracted thus :-

"That I Gopinath Pani, my father Bhagyarathi Pani, Alekha Pani, father of Dinabandhu Pani and father's brother of Basudeo Pani and N arsinha Pani father of Balabhadra Pani-minor, having made the image of our family deity Sri Padhakanta Deb installed it in a temple which was built by them in Depur Sasan in Pipli Division and they endowed the Tanki Bajyapati, Tanki Baheli and Kharida Swata properties given below from the usufruct of which day-to-day Sibapuja and J anijatra of the deity was managed by them as the Sebait and Marfatdar and we are also managing in the same way. For the proper management of the deity's property and the Sebapuja of the deity in future, we lay down the following directions out of our own accord.

E :.-.

1. .... we hereby appoint the said Adwait Charan Das Babaji, Sutradhari Gaudeswar Sampraday Baisnab by caste, worship and Sebapuja of the deity by profession as the Tatwabadharak and Se bait and hereby (appoint) him by this trust deed and we become aloof from those duties E vesting in him the following properties of the deity . ...

2. From this day the said Babaji will manage all the immovable and movable properties of the deity as the Sebait and Tatwabadharak.

He will realise the usufructs of the property and after g.Ving the rent of the lands, he will manage the day-to-day Bhog and the festivities of the deity well according to the previous customs and rules and in the way we were doing and will keep the surplus amount in the store of the deity.

3. Tbe day-to-day Bhoga and the festivities of the deity will be done according to the income of the properties of the deity and will never exceed the said income.

4. The said Babaji cannot incur any loan on behalf of the deity nor can he sell, mortgage, keep as surety or trust

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any of the immovable or movable properties iwr can he A misappropriate any cash kind ornament or utensils of the deity.

6. If the said Babaji does anything contrary to the conditions laid down in items 4 & 5 written above he Will beremoved from his right of Sebaitship and Tatwabadharakship by us or our heirs who will appoint another fit man in his place and take the charge of all the properties in the store of the deity .. ...

9. As the properties maintained herein have been endowed to the deity before, we or our successors had or will have IW claim on this and any such claim made, shall be void.

11. Now or in future the man appointed as Tatwabadharak will work according to rules and directions mentioned herein and for the Sebapuja of the deity the directions and the menus are determined here for all days to come. 12 ..... All other necessary expenses of the Jatra

(festivals) repairing of the temple, utensils and the oma- E ments of the deity, etc. will be done according to the income.

14. Any pious man of our family at present and in future will see whether the work of the deity is being performed according to the direction as aforesaid by the F appointed Tatwabadharak and will take proper action as mentioned above.

14. If in future there be no fit man in our family, any of the Baisnab Sampraday and any Hindu of reputation of the village and of the locality is entitled to take such action, we have no obiection to this." G (Emphasis supplied) The intention which can be gathered from this document is placed beyond doubt by a later document Ext. 1 which was executed on 17-11-1932 and is in the nature of a settlement Deed, the relevant portions of whch may be quoted thus :- H "Our foref.1thers for the good of our family by making the family deity Sri Radhakanta Deb Thakur, erecting a

temple befitting. His installation, installing Him therein and endowing the landed properties as described in the schedule below, used to carry out all the Sebap11ia work of the deity in orderly manner by meeting the expenses from out of the income and yield of the said properties ...... As the said Lalit Charan Das and Raghunath Pani a person of our family together misappropriated by utilising the income and yield of the properties of the deity in illegal expenditures and without carrying on the Sebapuja work in proper manlier caused heavy damage to the movable and immovable nroperties of the deity in different unfair means, we have removed them from Sebapuja work of the deity and also from management and custody of the deity's properties. . . If the work of the deity is carried on for some time more in the manner in which the work is being managed now. then the temple established by our forefathers as a mark of pride of our family and all the Debuttor properties of the deity will be destroyed in toto and the noble glory of the forefathers will perish . . . . . .

We by this deed of trustee order determination appointed you as trustee for the Sebapuja work of our family deity Shri Radhakanta Deb Thakur and for the work of looking after His properties, according to the following conditions and terms, so that from today onwards on the strength of this deed of trustee order determination you from Chela to Bara chela by carrying on the Sebapuja, offerings, religious ceremonies and festivals and by preserving and looking after all the debuttor properties, realise the income and yield therefrom according to convenience. ..

10. If we or any body amongst us misappropriate any money or property by taking secretly from the tenants or borrowers, we and our successors will be liable for punhhment according to criminal Jaw and you can realise any compensation you intend to -take either mutually or with the help of the court. We and our sons and grandsons shall be bound and liable to pay. .. •:•

22. But if you might have obtained, any amount on Joan against the income of the debuttor property and anything that you might have spent from your own pocket for the improvement of the deity of the muth and to save the property, we will be bound and liable to repay the said

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amount alongwith just aud prescribed rate of interest, and we shall repay. If we do not repay voluntarily you and JIPUr successors will realise from us and from our and from our sou's and grandsons' existing and to be acquired movable and immovabb properties and from the existing and to be acquired debuttor properties of the deity according to law."

(Emphasis supplied) Considering the iwo documents together the fundamental features, which fiow from the recitals extracted above, may be summarised as follows:-

(1) That the deity was installed in the temple purely as c a family deity and the dedication M.s made only for a group of individuals who may be connected with the family of the Panis who were the founders of the deity.

This clearly establishes that the intention of the founders was to dedicate their properties and instal the deity in the temple only for purposes D of the Pani family, and their descendants.

A peruial of the recitals extracted above would unmistakably show that there can be no two opinions on this question.

(2) Extensive private properties belonging to the Pani family alone were dedicated for the maintenance of the temple and the deity and there is nothing to show that any contribution was called for from members of the public nor is there auy averment in the deed to show that there was any stipulation for taking offerings from the members of the public to worship in the temple.

(3) There was no provision for framing any scheme by associating the members of the public or consulting them.

In fact, Ext. 1 shows that even after the descendants of the founders had fallen on evil days and were not in a position to provide sufficient funds for the maintenance of the temple yet they appointed

Udayanath Pattanayak to manage the affairs of the deity and bound themselves personally to reimburse the Manager for any out-of-pocket expenses incurred in connection with the maintenance of the temple.

This circumstance manifestly proves that the endowment was of a purely private nature right from the time it was created till 1932 when the management

(4)

was changed and continned to be of the same nature . . Indeed, the personal undertaking contained in Ext. 1 clearly shows that there was never any intenlion to treat the temple as a public one but the intention was, if at all, to continue it in the name of the family so long as the family continued. ~

' Thero is no recital in any of the documents to show that the members of the public or the,1 villagers of the place where the temple was si(Uated were entitled to worship as of right.

On the other hand, PWs 1 to 6 who were examined by ' the appellants-plaintiffs have categorically stated

1 that members of the public were not allowed to wotship in the temple as of right.

In this connection FW 1 stated as follows :-

"Members of the public have no right to

1 have Darsan of, or to offer bhog to the deity.

The villagers do not make Kirtan before the deity or

' take any part in any festivity of the deity. , The deity has no Bahari Jatra. No member of the public made any gift to the deity.

No khairat is ever given.

The properties of the Thakur are all

(sic) with rent."

PW. 5 stated that the disputed deity was instailed by the family of the other Panis and not by his ancestors and that the deity was not their family deity and was not dedicated to the public. As against this oral evidence, the defence examined DW 1, Raghunath Pani, whose evidence has been rejected both by the Trial court F and the High Court.

Thus, apart frOlll the unimpeachable documentary evidence discussed above, even the oral evidence to prove -..-.._ that the endoWlllent was of a private nature is clear and has not been rebutted by the defence.

In this state of the evidence we are indeed surprised to find how the High Court could ho!P that the endoWlllent was, of a public nature.

The High Court seems to have been carried away by factors or considerations which are of a very minor nature and by themselves do not prove that the endowment was of a public nature. For instance, one of the circumstances that weighed with the High Court was that the temple was a massive structure of about 25 yards in U height.

That by itself, divorced from other things, could not prove that the temple was a public one.

So far as the oral evidence is concerned, the High Court observed thus :

"Apart from the above features disclosed by the oral evidence which are indicative of the institution having been treated as a public one. the recitals in some of the clauses of the two documents.-(Exts. A & 1) also unequivocally indicate an intention of dedication in favour of public."

These observations are not at all borne out by the evidence of PWs. 1 to 5 which is the only oral evidence led in the case, the evidence of DW 1 having been rejected by the trial court as also the High Court.

The High Court took into consideration the fact

that certain properties were neded for the maintenance of the c temple and Seba-puja and other ceremonies were being performed by the Shebaits and Marfatdars.

The High Court overlooked the fact that Shebait or the Marfatdars were appointed by the founders of the endowment and the entire management and control of the temple was retained by the family.

We are unable to agree as to how in these circwnstances could it be said that the endowment wa~ D of a public nature.

Another circumstance that weighed with the High Court was that bhogs were offered during the day which,· according to the High Court, was in consonance with the rules observed by the public. 1 his circumstai; ce also is not of much consequence because bhogs are offered even in private temples.

The High Court also seems to have relied on clause 15 of Ext. A to come to its decision that the endowment was of a public nature. The High Court was

of the view that under this clause in certain contingencies any member of the Vaishnav sect or Hindu resident of the village was F authorised to exercise the powers and functions mentioned in clause 7 of the deed.

We are, however, unable to agree with the interpretation placed by the High Court on clause 15 of Ext. A.

Clause 15 merely provides that if in future the family becomes extinct and no fit person could be found then any of the Baisnab Sampraday or any reputed Hindu of the village could take action, G namely, to perform the work of the deity.

This was a contingent provision and here also the founders did not confer the duty of performing all the work on the members of the public but they chose or selected only a particular person belonging to a particular community which als0 shows that even if the family was to becomel extinct, the private nature of the endowment was not to be chang- H ed.

Indeed if the intention was to instal the idol in the temple by way of a public endowment, clause 15 would have clearly provided

that in case the family became extinct the members of the public or of the brotherhood or the Government could have taken over the management.

On the other hand, the interpretation of the various clauses of the documents clearly shows that sufficient care has been taken by the Pani family to sec that the dedication to the family deity is not changed even if the family becomes extinct.

Having, therefore, carefully perused the oral and the documentary evidence in the case we are satisfied that the COlllClusions arrived at by the High Court are wrong and are based on misinterpretation of Ext. A and Ext. 1 and misreading of the oral evidence led in the case, which, as we have shown, runs counter to the C conclusions arrived at by the High Court.

For the reasons given above, we allow this appeal, set aside the judgment of the High Court, decree the plaintiffs-appellants suit and restore the judgment of the trial court. In the peculiar circumstances of this case, the appellants will be entitled to costs of the appeal in this Court quantified at Rs. 4,000/- (Rupees four thousand only).

S.R.

Appeal Qllowed.

RADHAKANTA DEB & ANR

COMMISSIONER OF HINDU RELIGIOUS ENDOWMENTS, ORISSA

February 13, 1981

A. VARADARAJAN

[1960] 1 SCR 773

[1971] 3 SCR 680

[1976] 3 SCR 518

Baisnab Sarnpraday

clause. 14

Orissa High Court

P. K. Chatterjee

Rathin Dass

G. S. Chatterjee

FAZAL

Art. 133

s. 62

Orissa Religious Endowment Act, 1939

Radhakanta Deb

P. K. Chatterjee

Mukherjee

S. K. Das

Dinshah Mulla

[1960] 1 S.C.R. 773

Krishna Iyer

[1971] 3 SCR 680

February 18, 1895

Gopinath Pani

Bhagyarathi Pani

Alekha Pani

Dinabandhu Pani

Basudeo Pani

N arsinha Pani

Balabhadra Pani

Padhakanta Deb

Tanki Bajyapati

Tanki Baheli

Kharida Swata

Adwait Charan Das Babaji

Sutradhari Gaudeswar Sampraday Baisnab

Babaji

Babaji

Tatwabadharakship

Tatwabadharak

Baisnab Sampraday

Radhakanta Deb Thakur

Lalit Charan Das

Raghunath Pani

Chela

Bara

Panis

Udayanath Pattanayak

Raghunath Pani

Shebait

clause 15

clause 7

clause 15

Clause 15

clause 15


...

.. '

OM PRAKASH SUD ETC. ETC.

STATE OF J & K & ORS. ETC. ETC.

February 16, 1981

[R. S. PATHAK, 0. CHINNAPPA REDDY AND BAHARUL ISLAM, JJ.] B

Constitution of India 1950, Article 14-Allotment of resin-Industrial pa/icy decision of State-Object of-Balanced economic and regional development of State--Selection of quota seekers-Article 14 wltetlier violated.

The petitioners in their writ petitions to this Court alleged that they were C carrying on small scale industries for the manufacture of resin and turpentine oil and that they applied to the Government for allotment of resin for their industries but the Government referring to their policy decision of March 20, 1978 refused to make any allotment, "'1d that they purchased raw material from the open market and managed to run their industries. They further alleged that while they were refused allotment of supply of raw-materials, the State, respondent No. 1 made allotments to respondent nos. 4 to 16 D although most of them were not even formally resistered at the time of 111llking tho impugned orders of allotment and that they were consequently adversely discriminated against, while respondent nos. 4 to 16 were favoured and as such the impugned orders of allotment were liable to be struck down as violative of Article 14 of the Constitution of India.

The State, respondent No. 1 contested the writ petition, denied the E material allegations of the petitioners and alleged th<>t the allocations were made in conformity with the State Industrial Policy decision of securing the balanced economic and regional development of the State: that there wa~ a preponderance of industries in the Jammu Region, and that the industries of the petitioners as well as respondent nos. 4 t'o 16 were also functioning in that region.

Allotments of resin were made districtwise, 110 applications were received and considered and aUotment was made to respondents nos. 4 F to 16.

On the question whether the orders Of the 1st respondent allotting quotas of resin to respondent nos. 4 to 16 were arbitrary and violative of Article 14 of the Constitution.

HELD: l(i) Respondent No. 1 has not explained as to bow and on what basis if any, the allotments were made by the impugned orders in favour of the new allottees respondent nos. 4 to 16 whose industries were located in the Jammu region. [847 CJ

(ii) Although the State Government has taken reli•nce on the State

" Industrial Policy decision, it does not appear to have followed it in practice, ' except in the cases of five respondents. No reasonable basi1 bad been H adopted in making the allotments in favour of the new allottoes and denying the allotments to tho petitionol'I. [849 E-FJ

2. The rule of equality does not mean mathematical equality. It permits of practical inequalities.

What is needed is that the selection of quota seckeJS as in the instant case should have a rational rela•tion to the object sought to be achieved in the industrial policy decision of the State. If the selection or differentiation is arbitrary and lacks a rational basis it offends Article 14. [849 DJ

3. "Equaolity before the Law" or "equal protection of the laws'' within the meaning of Article 14 of the Constitution of India means absence Of any arbitrary discrimination by the law or in. their administration. No undue favour to one or hostile discrimination to another should be shown. A classi fication is reasonable when it is not an arbitrary selection but rests on differences pertinent to the subject in respect of which the classification is made. The classification permissible must be based on some real and subs- C tantial distinction, a just and reasonable relation to the objects sought to be attained and cannot be made arbitrary and without any substantial basis.

[848 H-849 A]

State of West Bengal v. Anwar Ali, [1952] SCR 284 referred to.

ORIGINAL JURISDICTION : Writ Petition Nos. 3464-65, 5908 & 3231 of 1980.

(Under Article 32 of the Constitution)

S. N. Kacker, K. N. Bhatt and Surendara Raju for the Petitioners in W. P. Nos. 3464-65/80 and 5908/80.

Soli J. Sorabjee, E. C. Agarwala, R. Satish and V. K. Pandita for E the Petitioner in WP 3231/80.

L. N. Sinha, Att Genl and Altaf Ahmed fur R. 1. in WPs 3464- 65/80.

Y. S. Chitaley and Vineet Kumar for R. 14 in WP 3231/80 and for R. 2 in WPs 3464-65 /80.

R R. P. Bhatt ; md N. R. Chaudhary for R. 4 in WP 3464/80.

P. R. Mridul and Naunit Lal for R. 7 in WP 3231/80 and for R. 2 in WP 3464-65 /80.

Anil Dev Singh and Ashok Grover for R. 15 in WP 3231/80 and R. 3 in WPs 3464-65/80

G S. K. Bhattacharya and Suresh Sethi for RR. 6 and 12 in WP 3464- 65 /80.

Satish Vij for R. 15 in WP 3464-3465/80.

S. Balakrishnan and S. K. Bhattacharya for R. 16 in WP No. 3231/ 80.

H The Judgment of the Court was delivered by

BAHARUL ISLAM, J.-'By these writ petitions under Article 32 of the Constitution the petitioners have challenged the orders of the

~ ..

• ,

' •

• '

first respondent (the State of Jammu and Kashmir) allotting quotas of A resin to respondents.

According to the petitioners these orders denying similar treatment to them are arbitrary and violative of Article 14 of the Constitution of India.

2. The material facts in the four petitions are similar. The industries of which the petitioners are partners are admittedly small scale in- B dustries for the manufacture of resin and turpentine oil. The industries of the petitioners' in Writ Petitions Nos. 3465 of 1980 and 3231 of 1980 were provisionally registered but revalidated for short periods.

The industry of the petitioner in Writ Petition No. 3464 of 1980 was provisionally registered, revalidation was applied for but was not granted. The industry of the petitioner in.Writ Petition No. 5908 o!f 1980 C was formally registered. It appears that the petitioners were applying to the Government for allotment of resin as well as raw material for their industries but the Government referring to their policy decision of March 20, 1978 refused to make any allotment of Oleo resin to them.

The petitioners i, n Writ Petition Nos. 3464 and 5908 of 1980 have alleged that they purchased raw-material from the open market and D somehow managed their industries to run for a certain period.

3. Resin is admittedly a forest product extracted from "Chir trees".

It has been alleged that only three States of India, namely, Himachal

Pradesh, Uttar Pradesh and Jammu and Kashmir have Chir forests.

The petitioners have alleged that the State of Himachal Pradesh and E Uttar Pradesh stopped selling resin for the last several years in view of establishment of factories in public and joint sectors and that the State of Jammu and Kashmir was selling resin by public auction. Sometime after October 1978 the State of Jammu and Kashmir, it has been further alleged, virtually created monopoly in favour of three existing industrial units and committed to supply them about 17,000 M. T. of F resin for long time to come.

There is a public sector unit in J ammu which consumes about 3,000 tons of resin per year. Several small scale industries, according to petitioners, were assured supply of resin even as late as 1979 notwithstanding the Government's aforesaid industrial policy. In such a situation, being unable to procure raw-materials for their industries, the petitioners approached the relevant authorities G including the Deputy Minister of Industry and the Chief Minister of Jammu and Kashmir for allotment of raw-materials but to no avail. (For the sake of convenience we shall hereinafter refer only to the respondents and Annexures in W. P. No. 3231of1980). The petitioners further allege that while they we.re refused allotment of supply of raw- H materials, respondent No. 1 made allotments to respondents No. 4 to 16 (hereinafter called "allottee respondents") although most of them

were not even formally registered at the time of making the impugned orders of allotment.

The petitioners contend that in the circumstances they were adversely discriminated against while respondents Nos. 4 to 16 were favoured and as such the impugned orders are liable to be struck down as violative of Article 14 of the Constitution of India.

4. The impugned orders have been annexed as Annexures N to

Z-1.

The letter of allotment (Annexure 'X') in favour of M/s. Sud Pine Industries (respondent No. 27) is in the following terms:-

"Sub : Supply of resin to M/s. Sud Pine Inc!ustries Kunc wani for their factory at Talab Jammu.

Govermnent Order No. 175 DIC/1980 dated 30-5-1980.

In partial modification of Government order No. 2. DIC of 1979 dated 20-1-1979 sanction is accorded to the SU[lply of crude (oleo) resin 700 tonnes per annum by the Forest Deptt. to Ml s. Sud Pine D Industries for their factory at Kunjwani Talab Jammu on the terms and conditions specified in the above said order. The supply of resin shall be subject to its being reviewed by the Govermnent with due regards to its availability from year to year.

By order of the Govt. of J &K.

Sd/-

(Sheikh Ghulam Rasool) Secretary to Government."

The orders as per annexures L to W in favour of respondents 17 to 26 are identical in material parts. It will be sufficient if the material portion of Annexure N is quoted. It runs thus.

"Sanction is accorded to the supply of crude (oleo) resin by the Forest Department to M/s. Kashmir R & T Works, Srinagar, for their factory at Srinagar, subject to the terms and conditions of the agreement to be entered into between the Forest Department and the party and on the following specific conditions :-

1. The Forest Department will supply Crude (oleo) resin @ 700 TPA to the firm from the date the Unit is formally registered subject to its being reviewed with due regard to its availability from year to year;

2. The resin will be supplied @ Rs. 320/- per quintal, A unless otherwise reviewed on year to year basis.

3. The cost of empty tin will be charged @ Rs. 5/- per tin in addition to the above rate;

4. By order of the Government at Jammu and Kashmir.

Sd/- Sheikh Ghulam Rasool Secretary to Government."

(emphasis added)

5. n is obvious that the industries of these respondents were not formally registered at the time of the impugned orders of allotment.

6. The State of Jammu and Kashmir (Respondent No. 1) have filed a counter affidavit. They have not denied the material allegations of the petitioners but they say that the allocations have been made in order to implement the industrial policy of the State Government as enunciated in a "Report of the Development Review Committee, Jammu and Kashmir" a committee headed by Shri L. K. Jha, the Governor of the State. Respondent No. 1 has quoted from the report the 'Goals' of the industrial policy which read :

"The balanced economic development of the State will obviously, be one of the foremost concerns of the Government.

They would like to emphasis maximum self-sufficiency and self-reliance consistently with the need to promote the requisite and desirable degree of inter-dependence with other parts of the country.

The objective will be to secure the most prudent and beneficial utilization of the natural resources and skills peculiar to this State; to achieve the maximum possible rate of economic growth, consistently with the need to secure a degree of balanced regional development as well as balance between the rural areas and the urban, to maximise State per capita income, and to generate the maximum employment potential.

Many areas of the State are as cut off, isolated and poor as they were at the dawn of independence.

We have to improve the living standards in these specially backward areas for whom in terms of the quickost mode of transportation, Srinagar is more distant than the State is from Kerala.

Many sections of the community similarly, like Scheduled Castes; Guiara and Bakarwalas and other hackward class need to be assisted in their speedy uplift.

A Ladakh needs 11 visible acceleration of the tempo of its development so that our people in this far flung and difficult frontier area can realise the full fruits of development in the

shorte~! possible time."

Respondent No. 1 has given the district wise break-up of the appli- B cations received from different regions. It is as follows :

Jammu Udaypur Rajouri Poonch Doda Katbua Anantnag Srinagar Outsiders

GRAND TOTAL

63 10

1 1 1 9 2 11 12

Applications 110

They have also shown the allotments of resin districtwise. The industries: of the respondents No. 4 to 16 are also small scale industries. The break-up of the small scale industries as given in Annexure R.II (in W.P. No. 3464) shows that Jammu has the largest number of units namely, 10, Second comes Srinagar with 4, then come Udampur with 3, Kathua (in Jammu Division), Anantnag and Baramul!a (in Kashmir Division), with one each. Rajouri in Jammu Division has none. It appears that the industries of the present applicants are also in the Jammu region and those of respondents No. 4 to 16 also appear to have been located in the Jammu region. In their affidavit at para 3 respondent No. 1 has stated that all the applications for allocation of resin were considered from time to time at various levels by the State Government and it was decided on May 30, 1980 as follows :

(a) The allotment of resin to the existing unit should be rationalised;

(b) Applications received from various districts be considered for allotment of resin.

The State Government have submitted that they made no promise of supply of raw-material in favour of any of the petitioners. The petitioners have submitted, in our opinion, correctly, that as there were already 10 units functioning in small scale sector in the Jammu region and inasmuch as the allottee respondents' industries were also located in the Jammu region, allocations in their favour would be inconsistent with the Government's industrial policy.

7. In the instant case, respondent No. 1 as well as the other parties has taken reliance on their industrh1l policy statement as stated above. We have already quoted the relevant portions of the State Industrial policy statement. The Government have stated that they have considered all the 110 applications including those of the petitioners coming from industrialists of different parts of the country.

They have stated, and their statement is corroborated by the documenls, that there is preponderance of industries in the Jammu region and industries of the petitioners as wel! as respondents No. 4 to 16 were also functioning in the same region. Respondent No. 1 has not explained as to how and on what basis, if any, the allotments were made by the impugned orders in favour of the new allottees whose industries were located in the Jammu region.

Pawan Kumar Sharma, the petitioner in W.P. No. 3231 of 1980 states that his industry was provisionally registered under the Provisional Registration Certificate dated 29-1-1976. It was further extended for further short periods. He says that as there was assurance from the authorities that raw-materials will be allotted to him after he completed the installation of requisite machinery.

The J. K. Resin and Turpentine Industries of petitioner Om Prakash Snd, was provisionally registered in the year 1975. He was also approaching the Government from time to time to get allotment of the raw-materials but got no favourable reaction from the Government. He states that he had already established his factory and got it insured for a sum of Rs. 6.80 lakhs. He obtained raw-material from the open market and was running his industry.

Petitioner, Ravindra Dutt of M/s. Dinesh Resin and Turpentines

in W.P. No. 3465 of 1980 alleges that his industry was provisionally ~, registered on 25-10-1975 which was extended upto April, 1979. Letter of 31st May, 1979 shows that his industry was later on formally registered as a small unit. This factory was producing resin and turpentine out of the resin which he purchased from open auction.

He was approaching the Government from time to time to get requisite quantity of raw-materials but failed to get it.

Petitioner, Shamlal Kapoor, Direclor of Jammu Resin Enterprises Private Limited, alleges that his industry was formally registered with the Government of J & K. He alleges that his industry was functioning for a long time and trying to get necessay quota of raw-materials from respondent No. 1. He was approaching the Government to get requisite quota. Sud Pine Industries, was provisionally registered on H 10-3-1978 and formally registered on 10-10-1978. It appears from Annexure N, in respect of respondent M/s Kashmir R & T Works

(respondent No. 17), Annexure 0 in respect of M/s. Sun Shine R & T Industries (respondent No. 18), Annexure Pin respect of M/s. Woolan Paints and Chemicals Scopore (respondent No. 19) Annexure Q in respect of Mis. Pine Wood Products Company (respondent No. 20), Annexure R in respect of M/s. Haji Mast Ali Slaria (respondent No. 21), Annexure S in respect of M/s. Phyto Chemicals (respondent No.

B 22), Annexure T in respect of M/s. New Himalayan Paints and Chemicals (respondent No. 23), Annexure U in respect of M/s. S. K.

Chemical (respondent No. 24), Annexure V in respect of M/s.

Rajindra R & T (respondent No. 25) and Annexure W in respect of M/s. Bharat Paints and Chemicals (respondent No. 26) that the c

allotments were made in their favour "from the date the unit is formally_ registered'.' which shows that industries were not even registered at the time of the impugned orders of this allotment. Respondent M/s.

Rajindra R & T Industries, Udhampur, appears to stand on a different footing.

He appears to have fulfilled all the conditions required for allocation of resin in accordance with the policy of the State of J&K.

The industry is an experienced one and thei factory started production of resin and turpentine at Hoshiarpur since 1948. It is a firm registered under the Indian Partnership Act and has long experience in the business including resin and turpentine since 1948. The industry set up a factory in 1970 in the rural industrial estate near Udhampur which is a backward area. The industry was provisionally registered in 1970 and fonnal registration was granted on 29-2-1974. It applied for adequate quantities of raw-materials and was allotted only 200 tons although it had been sanctioned 1500 per ton per annum since 1975.

Respondent M/s. Sud Pine Industries, M/s. Kashmir R&T Works, Bakshi Resin & Turpentine and M/s. K. C. Soni Bakshi also appear to be on different footings. It appears from Annexures 'X' and 'Y' that F the first two indnstries have already been formally registered. They are existing nnits having already started production. So far as respondent M/s Bakshi Resin and Turpentine is concerned, it had already set np factory and started production. It was provisionally registered as early as 1976 and the unit is located in a backward area. So far as respondent

G K. C. Soni Resin & Turpentine is concerned, it was formally registered on 19-4-79. This unit is located in a remote backward area of the State.

8. "Equality before the Law" or "equal protection of the laws" within the meaning of Article 14 of the Constitution of India means absence of any arbitrary discrimination by the law or in their adminis- H tration.

No undue favour to one or hostile discrimination to another should be shown.

A classification is reasonable when it is not an arbitrary selection but rests on differences pertinent to the subject

• '

in respect of which the classification is made.

The classification A

permissible must be based on some real and substantial distinction, a just and reasonable relation to the objects sought to be attained and cannot be made arbitrarily and without any substantial basis .. . ....... (See State of West Bengal v. Anwar Ali(1). The classification must not be arbitrary but be rational, that is to say, it must not only be based on some qualities or characteristics which are to B be found in all the persons grouped together and not in others who are left out.

Those qualities or characteristics must have a reasonable relation to the object of the law.

In order to pass the test, two conditions must be fulfilled, namely, (1) that the classification must be founded on an intelligible differentia . which distinguishes those that are grouped together from others, and (2) that that C differentia mnst have a rational relation to the object sought to be achieved by the Act.

The differentia which is the basis of the classification and the object of the Act are distinct things and what is necessary is that there must be a nexus between them.

We are not unaware that the rule of equality does not mean mathematical equality and that it permits of practical inequalities.

But what is needed is that the selection of quota seekers as in the

case in hand should have a rational relation to the object sought to be achieved in the industrial policy decision of the State. If the selection or differentiation is arbitrary and lacks a rational basis it offends Article 14.

9. In the instant case, although the State Government has taken reliance on the State Industrial Policy decision referred to above, they do not appear to have followed it in practice, except in the cases of the five respondents referred to above.

In fact no reasonable basis has been adopted in making the allotments in favonr of the new allottees and denying allotments to the petitioners. In the circumstances the petitions are partly allowed, the impugned orders. / , of allotments except in favour of respondents, M/s Rajindra Res~ and Turpentine Industries, M/s Sud Pine Industries, M/s Kashmir ; R & T Works, M/s Bakshi Resin & Turpentine and .. M/s K. C.

Soni Resin & Tnrpentine are quashed.

The petitions are partly allowed.

The Rules are made absolute except as against these five respondents. The respondent No. 1, the State of Jammu and Kashmir, is directed to make the other allotments of the raw-materials to the • applicants in the light of the observations made above . '

10. Respondent No. 1 shall pay costs of Rs. 100.00 to each of the petitioners. •

N.V.K.

Petition partly allowed . '

(I) [1952] S.C.R. 284

7-214 SCI/81

OM PRAKASH SUD ETC. ETC

STATE OF J & K & ORS. ETC. ETC

February 16, 1981

R. S. PATHAK

0. CHINNAPPA REDDY

BAHARUL ISLAM, JJ.

Constitution of India

Article 14

Article 14

March 20, 1978

Article 14

Constitution of India

Jammu

Article 14

Article 14

Article 14

Constitution of India

Article 32

S. N. Kacker

K. N. Bhatt

Surendara Raju

Soli J. Sorabjee

E. C. Agarwala

R. Satish

V. K. Pandita

L. N. Sinha

Altaf Ahmed

Y. S. Chitaley

Vineet Kumar

R R. P. Bhatt

N. R. Chaudhary

P. R. Mridul

Naunit Lal

Anil Dev Singh

Ashok Grover

G S. K. Bhattacharya

Suresh Sethi

Satish Vij

S. Balakrishnan

S. K. Bhattacharya

Article 32

State of Jammu and Kashmir

Article 14

Constitution of India

India

Himachal

Pradesh

Uttar Pradesh

Jammu and Kashmir

State of Himachal Pradesh

E Uttar Pradesh

State of Jammu and Kashmir

J ammu

Article 14

Constitution of India

Sud Pine Industries

Sud Pine Inc!ustries Kunc

Talab Jammu

Kunjwani Talab

Sheikh Ghulam Rasool

Kashmir R & T Works

Srinagar

Forest Department

Ghulam Rasool

L. K. Jha

Kerala

Guiara

Udampur

Kathua

Jammu Division

Anantnag

Baramul!a

Kashmir Division

Rajouri

May 30, 1980

Pawan Kumar Sharma

J. K. Resin and Turpentine Industries

Om Prakash Snd

Ravindra Dutt

31st May, 1979

Shamlal Kapoor

Jammu Resin Enterprises Private Limited

Sud Pine Industries

Kashmir R & T Works

Sun Shine R & T Industries

Woolan Paints and Chemicals Scopore

Haji Mast Ali Slaria

Rajindra R & T

Bharat Paints and Chemicals

Rajindra R & T Industries, Udhampur

State of J&K.

Hoshiarpur

Indian Partnership Act

Udhampur

Kashmir R&T Works

Bakshi Resin & Turpentine

K. C. Soni Bakshi

Bakshi Resin and Turpentine

G K. C. Soni Resin

Article 14

Constitution of India

Article 14

Rajindra Res~

Turpentine Industries

Bakshi Resin & Turpentine


STATE OF ASSAM

v •

.llTENDRA KUMAR SENAPATI & OTHERS

February 17, 1981

[S. MURTAZA FAZAL ALI AND A. D. KosHAL, JJ.]

Land Acquisition Act, 1894, sections 23 and 34-Agreen1ent between the parties reduced in writing to accept a specified sun1 by a specified date two years after the land acquisition-Whether the words "would not n1ake any

further claini in regard to con1pn1.1atio11" liou.ld exclude further clain1s of interests under the Act.

Accepting the State appeal, negativing the clnirn for interest and disn1issing the original writ petition, the Court,

HELD : The expression "would not make nny further claim in regard to compensation" in the agreement dated the 24th February, 1969 was clearly used by the petitioners-respondents not in the sense in which it is used in sections 23 and 34 of the Land Acq_uisition Act but more comprehensively meaning reimbursement in full satisfaction of their claim in respect of the acquisition.

The condition attached by then1 to the relinquishment of their claim was that the agreed amount must be paid to them before 31st March 1969, which agreement would sho\V that by the acceptance of the quantified sum of Ro;;. 4,41,202.45 they condoned the delay in payment and also relinquished all future claims to interest. If it were otherwise, the respondents would have expressly reserved their right to claim interest under section 34 of the Act. [853 A-B, D-fl

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1947 of 1970.

From the Judgment and Order dated 17.3.1970 of the Gauhati High Conrt in Civil Rule No. 1151/69.

F s. N. Chowdhary for the Appellant.

D. N. Mukherjee for Respondent No. 2.

V. S. Desai, B. P.'Maheshwmi andS11resh Sethi and Miss Asha Jain~-._ for the Respondent.

The Judgme\1t of the Court was delivered by

KosHAL, J.

This is an appeal by certificate granted under subclause (a) of clause ( 1) of article 133 of the Constitution of India by the High Conrt of Assam and Nagaland against its judgment dated 17th March, 1970 accepting a petition under article 226 of the Constitution of India which arose in the circumstances that follow.

• '

H Land measuring 7.60 acres and situated at Lawshtnn, Bishnupur, • Shillong, belonged to the 5 respondents when a notification undr section 4 of the Land Acquisition Act (hereinafter referred to as the

• '

' •

Act) was published in respect thereof on 27th March 1967. Three days later the possession of the land was taken over by the Collector, United Khasi and Jaintia Hills, Shillong.

Proceedings for the award of compensation to the respondents were pending when negotiations took place between the Chief Secretary to the Government of Assam and two of !he respondents who agreed to the reduction of the cost of acquisition of the land from Rs. 6,17,683.50 to Rs. 4,63,262.57 (inclusive of cost of establishment and contingency amounting to Rs . 22,060.12).

Thereafter the Under Secretary to the Go¥ernment of Assam in the Home and Political/Department wrote to respondent No. 2 a letter dated 21st February, 1969 detailing the agreement arrived at between the Chief Secretary and the respondents and requesti'ng them-

"to please submit immediately a wiitten document signed by all the co-sharers of the land to the effect that yourself and all other co-sharers are agreeable to accept the L. A. cost of Rs. 4,41,202.45 for land at Bishnupur and that you and your co-sharers will make no further claim for the land thus acquired by Government."

The respondents lost no time in sending their reply which was dated 24th February 1969 ankd in which they stated that the delay in payment had caused to them great hardship and that they had agreed to reduce !he cost of the acquisition in the course of their discussion with the Chief Secretary whom they had urged "at the same time that the payment should be made immediately." The reply was signed by all the five respondents and was accompanied by an agreement (also signed by all of them), the text of which may be set out in extense :

"We, all !he co-shares interested in the land acquisition case for constrnction of quarters for Special Branch Staff of Police Department at Lawsohtun, Bishnupur, Shillong, hereby agree in response to the Government Letter No. 356/ 66155 dated the 21st February, 1969 to accept the land acquisition cost of Rs. 4,41,202.45P (Rupees four lakhs forty one thousand two hundred and two and forty five paise only) subject to Government making payment within the 31st March, 1969 for our land measuring more or less 7.60 acres at Lawsohtun, Bish'nupur, Shillong.

"We further agree that we will make no further claim in regard to compensation for the same land provided actual

SUPREME COURT REPORT~

[1981] 2 S.C.R.

payment is received within the above period of 31st March,

1969."

The agreement between the parties was reduced by the Collector to an award dated the 25th March 1969 and on the very next day the sum of Rs. 4,41,202.45 was paid to the respondents.

On 31st March 1969 the respondents made an application to the Oiief Secretary claiming interest at the rate of 12t per cent per anuum on the amount last mentioned. As there was no response from the Chief Secretary, the respondents applied to the Collector on 7th July, 1969 requesting him to pay interest on the amount awarded at the rate of 6% per annum for the period from 30th March 1967 to 26th March 1969 under section 34 of the Act which runs thus :

"When the amount of such compensation is not paid or deposited on or before taking possession of the land, the collector shall pay the amount awarded with interest thereon

at the rate of six per cent per annum from the time of so taking possession until it shall have been so paid or deposited."

The Collector informed the respondents by a letter dated 31st July 1969 that no action was necessary "at this stage". It was then that the respondents knocked at the door of the High Court.

2. The High Court was of the opinion that the agreement between the parties covered only the amount of "compensation" as described in the various sections of the Act including sections 23 and 34 and that interest had to be paid on such compensation by reason of the statutory requirement enacted in that behalf by section 34.

The High Court, therefore, accepted the petition filed before it and held that the F Collector was bound to pay to the respondents interest on the amount covered by the award at the rate of 6 per cent per annum from 30th

March 1967 (being the date on which the possession of the land was ·----x_

taken over by the Collector) to the date of payment, i.e., 26th March

1969. It directed the Collector to dispose of the petition dated the 7th July 1969 made to him by the respondents in accordance with law.

3. The short point requiring determination by us is whether the agreement arrived at between the parties in February 1969 embraced only the "compensation" within the meaning of that term as used in the. Act or covered also the payment of interest under section 34 thereof. Having heard learned counsel for the parties we are of the opinion H that the interpretation placed on the agreement by the High Court cannot be sustained and that the respondents are not entitled to any interest on the sum already paid to them.

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4. Although it is true that in the agreement dated the 24th February 1969 which the respondents signed and sent to the Government along with their letter of that date they stated that they would not make any furher claim in regard to "compensation", but that expression, in our opinion, was clearly used by them not in the sense in which it is used in sections 23 and 34 of the Act but more comprehensively, mea'ning re-imbursement in full satisfaction of their claim in respect of the acquisition. That this was so was made clear in the letter addresed to them by the Under Secretary in which he expressly stated that-

"you and your co-sharern will make no further claim for the land thus acquired by the Government."

The Under Secretary did not use the word "compensation" in his letter nor did the respondents use it in their reply in which, on the other hand, they made a grouse of the hardship which the delay in payment bad caused to them and brought it to the pointed attention of the under Secretary that immediate payment was an essential part of the bargain. In the agreement signed by them (as pointed out above) they no doubt used the word "compensation" but they added that they would make no further claim in regard to it if actual payment was received by them before the 31st March, 1969.

The condition thus attached by them to the agreement would show that by the acceptance of the quantified sum of Rs. 4,41,202.45 they condoned the delay in payment and also relinquished all future claims to interest. If it were

otherwise, there is no reason why the respondents would not have expressly reserved their right to claim interest under section 34 of the Act. The tenor of the two letters coupled with the agreement leads to no other conclusiOn.

4. In the result the appeal succeeds and is accepted.

The judgment of the High Court is set aside and the respondents' petition decided by it is dismissed but with no order as to costs.

S.R.

Appeal allowed.

STATE OF ASSAM

S. MURTAZA FAZAL ALI

A. D. KosHAL, JJ.

Land Acquisition Act, 1894

sections 23 and 34

sections 23 and 34

section 34

F s. N. Chowdhary

D. N. Mukherjee

V. S. Desai

B. P.'Maheshwmi

andS11resh Sethi

Asha Jain~-

KosHAL

article 133

Constitution of India

article 226

Constitution of India

Bishnupur

section 4

United Khasi

21st February, 1969

Shillong

31st March, 1969

Bish'nupur

31st March 1969

7th July, 1969

section 34

31st July 1969

sections 23 and 34

section 34

section 34

sections 23 and 34

section 34