3 S.C; R.

SUPREME COURT REPOR'fS 913

PRATAP CHAND

RAM NARAYAN AND ANOTHER. (P. B. GAJENDRAGADKAR, and K. N. WANOHoo, JJ.)

Mo1tgoge-Entire proprietary rights mortgaged-Sir lands not mentioned-If included in the mortgage-Other londs of the mortgagor coming ifltn mo•tgagee's pos<ession, if accession to the mortgage -Transfer of Propert:• Act, I882 (4 of i882). s. 70.

One Ramr.handar e]iecuted a simple mortgage deed without possession of his share in the property in dispute in favour of the respondents and others the relevant portion of which ran thus:-

"I do hereby mortgage without possession half share. five annas and four pies, area 678·31 acres, jama sarkar Rs. 326/10/8 together with Khudkashat,. chhc.taghas, big shrubs, abadi, gair abadi, cultivated and that lying vacant, and the rights and privileges appertaining to water, forests, chahat, gardens, and right of cultivation, malguzari and trees of every kind whether giving fruits or no fruits and prohibited and unprohibited wood with entire rights and privileges appertaining to the village."

After the mortgage Ramchandar's share was sold to the appellants and certain other lands recorded in Ramchandar's mother's name also came into the possession of the appellant.

The main questions arising for decision were whether the mortgage included the sir land of Ramchandar and whether the other lands corning into the possession of the appellant were accession to the mortgage.

Held, that as the mortgage deed stood it was a mortgage of all the proprittary rights in the mortgagor's share in the property including the proprietary right in the sir pertaining to that share.

As the mortgage was without possession the mortgagor was not losing possession of his sir and it was not necessary for him to make an application under s. 50 of the Central Provinces Tenancy Act relating to the reservation of a right of occupancy.

Sections 49 and 50 come into play when the propriet.or making a transfer loses his right to occupy any portion of his sir land temporarily or permanently.

Although in the plaint of the suit based on the mortgae no mention was made of sir, the entire proprietary right m sir, kliudkashat etc. relating tn the mortgagor's share would be sold on a decree passed in the suit.

The words " all rights pertaining to the share " appearing in the sale certificate following the execution of the decree in the mortgage suit passed in favour of the respondents would include the mortgagor's proprietary rights in the sfr land and the respondents by their sale certificate would get a right in the sir land also.

Ftb1uary aa.

Pratap Chand

Ram Narayan

As the appellant had purchased the entire share of Ram. chandar who was later ejected from his ex-proprietary tenancy which came into the possession of the appellant as lambardar his sir land which thus .came into the appellant's possession while the mortgage was subsisting became an accession to the mortgage under s. 70 of the Transfer of Property Act and the mortgagees were entitled to half share in the lands which came into the appellant's possession.

The lands recorded nominally in the name of Ramchadar's mother but in the actual possession of the former having also came into the possession of the appellant as lambardar were held by him for the entire body of proprietors and the respondent would be entitled to a share in them. The respondent's claim to those lands were not barred by 0. II, r. 2 of the Code of Civil Procednre merely because they were not mentioned in the plaint of the mortgage suit.

Hazarilal v. Hazarimal, A.LR. 1923 Nag. 130 and Seth Manakchatld v. Chaube Manohar Lal, A.LR. 1944 P.C. 46, held not applicable.

CIVIL Al'PELLATE JURISDICTION: Civil AppPal No. 272of1956. Appeal from the judgment and decree dated June 28, 1954, of the former Nagpur High Court, in First Appeal No. 107 of 1946.

M. O. Betalvad, Attmmy-General for lrul, ia, Purslwtfam Trikamdas, 8. T. Kkirwadkar and I. N. Shroff for the appellant.

Achhru Ram, A. R. Okaubey and N aunit Lal for the respondents.

1961. February 22. The Judgment of the Court was delivered by ·

Won.Ano J.

W ANOHOO, J,:_This is an appeal on a certificate granted by the Nagpur High Court. The brief facts necessary for present purposes are these. One Ram. chandar Jat originally owned Annas -10/8 share in Mauza Tamala.wadi while the rest belonged to others.

Ramchandar executed a simple motgage deed on July 27, 1920, in favour of Seth ltam Jiwan and two minors Ram Narain and Radhey Sham. The plaintiffs. respondents are the representatives of the mortgagees.

On August 27, 1926, the defendant-appellant purchased

~11&8 ./5/4 share belonging to the other shareholders in the village, Thereafter, the appellant brought a

suit against Ramchanda.r who was lamba.rda.r of the village for profits, in which a decree was passed against Ra.mchanda.r. In execution of that decree the appellant purchased the entire Annas -/10/8 share of Ra.mchandar in the village a.bout the year 1932. In consequence, the appellant became the owner of the entire village subject to the mortgage of the respondents on Annas -/5/4 share therein. On July 27, 1932, the respondents sued Ra.mchandar on the ha.sis of their mortgage-deed and a preliminary decree for sale was passed in March, 1937. To this suit the appellant was also a party. The preliminary decree was followed by a final decree and thereafter the property was put to sale and was purchased by the respondents on March 1, 1940. This sale was confirmed on April 12, 1940, and a. sale certificate was granted to the respondents. So, by the year 1940 the respondentil were the owners of Annas /5/4 share in the village while the appellant was the owner of Annas -/10/8 share. The appellant was also a lamba.rdar.

Ramcha.nda.r J at held sir land in certain khasras with a total area of 252·49 acres. On the sale of Ramchandar's share to the appellant, Ramchanda.r became an ex-proprietary tenant of his sir land.

Thereafter Ramcha.ndar was ejected from his exproprietary tenancy sometime in 1936 and the .Jands came into possession of the appellant. There were certain other lands which were nominally recorded as Mua.fi Khairati in the name of Ramchanda.r's mother but were actually in the possession of Ramcha.ndar.

It appears that Ra.mchandar was ejected from these lands also and they ca.me into the possession of the appellant. Further the appellant as a lamba.rda.r ca.me into possession of certain other lands by surrender or otherwise.

The respondents filed a suit for pattition before the Sub-Divisional Officer, Ha.rda, in 1942. In that suit they claimed hi.If share in the lands of Ramchandar and his mother which came into the possession of the appellant. They also claimed a share in other lands which came into the possession of the appellant as la.mbardar. Their 9ase was that these lands w.ere

Jl1

•I96t

Pratap ChaN4

Ram Na1aya

Wanchooj.

Piaiap Cha1Jd

v. ·flam Narayan

Wanchoo ].

accession to the mortgage in their favour and they were therefore entitled to a proper share in them.

This cla.im was resisted by the appellant before the Sub-Divisional Officer.

On October 20, 1943, the Sub- Divisional Officer passed an order which in effect zyjected the contention of the respondents and accept~ ellthe plea of the appellant.

Thereupon the respondents filed the present suit for a declaration in the civil court in 1944 claiming that they were entitled to a proportionate share in the lands specified in the plaint. The suit was resisted by the appellant and his contention .was that the respondents had purchased specific khudkashat and chhotaghas plots and that they therefore could not be allowed anything more than what was mentioned in the decree and the sale certificate which were the basis of their title. As the specific lands with respect to which the respondents claimed a declaration in this suit were not mentioned in the sale certificate, they were not entitled to any share in them. A large number of issues were framed by the trial court, which decreed a part of the claim put forward by the respondents but dismissed the rest. Consequently, the respondents went up in appeal to the High Court. The appeal was allowed so far as the respondents' claim to one-half share in the sir plots held by Ramchandar was concerned. Further, they were allowed one-third share in the hmds held by the mother of .Ramchandar and also in certain other lands which came into the possession of the appellant as lambardar subject to payment of certain amounts.

This was followed by an application by the appellant for leave to appeal to this Court and a certificate was granted by the High Court. That is how the matter has come up before us.

The main contention of the appellant before us is that the mortgage deed of 1920 which is the basis of the title of the respondents did pot jnclude the sir plots in the possession of Ramchandar nor the plots of Ramchandar's mother.

Nor were these plots included in the suit which was brought by the respondents on the basis of the mortgage-deed. Further, the sale certificate also did not include these plots, though

some other plots were mentioned therein. Therefore, the respondents were not entitled to these plots as accession to the mortgage.

This bringR us to a consideration of the mortgage in favour of the respondents. The mortgage was without possession and the property mortgaged was mentioned in these terms :

" I do hereby mortgage without possession half share . /5/4, five annas and four pies, area 678-ill acres, jama-sarkar Rs. 326/10/8 together with khud kashat, chhotaghas, big shrubs, abadi, gair abadi, cultivated and that lying vacant, and the rights and privileges appertaining to water, forests, chahat, gardens, and right of cultivation, malguzari and trees of every kind whether giving fruits or no fruits and proJtibited and unprohibited wood with entire rights and privileges appertaining to the village." It will be seen that what was mortgaged was the entire half share of Ramchandar. in -/ 10/8 share which he owned in the village. It istrue that the mortgage goes on to describe certain othllr things but that in our opinion is merely by way of precaution, for even if the part underlined* was not there in the mortgage, the respondents being the mortgagees of -/5/4 share would be entitled to everything contained in that share. The underlined* part of the mortgage therefore does not cut down the amplitude of the mortgage with respect to the entire -/5/4 share out of-/10/8 share of 'Ramchandar. It is true that sir is not specifically mentioned in the mortgage but as the mort-

1 gage was of the entire -/5/4 share out of -/10/8 share it will include (unless there "is a specific exclusion of sir) the area of sir also pertaining to the share mortgaged. In this connection our attention was drawn to ss. 68 and 69 of the Central Provinces Land Revenue Act, No. II of 191:7, which was in force at the relevant time. Section 68 deals with sir land and s. 69 with kkudkashat. Sir is defined in s. 2 ( 17) and khudkashat is defined in s. 2 (5) as " that part of the home-farm of

a mahal which is cultivated by the proprietor as such and which is not sir land. " Thus though sir land may be a part of the home-farm it is a different entity •Here printed in italics.

Pratap Chand

Ram Narayan

Wanchoo ].

P••laP Chand

Ram Narayan

W amhoo J.

918 SUPREME COURT itEPORTS [1961]

from khU!lkashat land. Reference was also made to ss. 49 and 50 of the Central Provinces Tenancy Act, No. I of 1920 (hereinafter called the Tenancy Act), which deal with transfer of sir land. Under s. 49 (1) a proprietor who temporarily or permanently loses whether under a decre.e or order of a civil court or by transfer or otherwise his right to occupy any portion of his sir land as a proprietor shall at the date of such loss, become an occupancy tenant except where he has obtained a sanction under s. 50 of the Tenancy Act. Further under s. 49 (2) there is a prohibition on the registration of documents which purport to transfer all the rights of a proprietor in his sir land without reservation of the right of tenancy specified in sub-s. (I). It is urged for the appellant that the reason why sir land was not mentioned in the mortgage deed of 1920 was that otherwise sanction of the Revenue Officer would have been required under s. 50 of the Tenancy Act. Nows. 50 provides that if a proprietor desires to transfer the proprietary rights in any part of his sir without reservation of a right of occupancy specified ins. 49(1) he may apply to the Revenue Officer and if such Revenue Officer is satisfied that the transferor is not wholly or mainly an agriculturist or that the property is self-acquired or has been acquired within the twenty yea.rs last preceding, he shall sanction the transfer. Sections 49 and 50 in our opinion only come into play when the proprietor making a transfer loses his right to occupy any portion of his sir land temporarily or permanently and sanction has to

be obtained under s. 50 only where the transfer is to be , made without reservation of t1:te right of occupancy.

Bnt the mortgage in this case is a simple mortgage and there was no transfer of possession under it.

Therefore the proprietor Ramchandar never lost his right to occupy his sirland by this mortgage and there was therefore no necessity for him to make any reservation in that respect or to apply for sanction under s. 50, for he was not losing the right to occupy his sir at all. But that does not mean that when he mortgaged his entire share of -/5/4 out of -/10/8 share, he was excluding from the mortgage the area of sir

corresponding to the share mortgaged. As the mortgage deed of 1920 stands, it is a mortgage of all the prop)'ietary rights in -/5/4 . share including the proprietary right in the sir pertaining to that share ; but as the proprietor was not losing his right to occupy the sir land, the mortgage being without possession, it was not necessary for him to make any application under s. 50 of the Tenancy Act. We are therefore of opinion that the appellant cannot take advantage in the circumstances of the fact that no application was made under s. 50 of the Tenancy Act and therefore there was no effect of this mortgage on the sir rights. As we read the mortgage it clearly affected the sir.right also pertaining to -/5/4 share and it was not necessary to make an application under s. 50 of the Tenancy Act, for the mortgagor wp.s not losing possession of his sir and there would be n:b question of any ex-proprietary tenancy arising in his favour, to relinquish which he would have to apply under s. 50.

Turning now to the plaint in the mortgage suit we find that the property subject to. the mortgage is mentioned in para. 2 thereof in exactly the same terms as in the mortgage deed. In para. 13 it is again recited that the mortgagor mortgaged -/5/4 share out of his -/10/8 share. Paragraph 13 then goes on to say that on the date of the mortgage, the mortgagor had certain khudkashat and chhotaghas lands and both cultivating and proprietary rights in them pertaining to half share only were liable to be sold. No mention was made of sir in this paragraph. But that in our opinion was not necessary, for the mortgage included the mortgage of sir land also pertaining to -f5/4 share though without possession. The prayer in the suit was for sale of the mortgaged property together , with khudkashat, etc. ; but this again was a mere matter of precaution, for in any case the entire propriet.ary right in sir, khudkashat, etc., relating to -/5/4 share would be sold on a decree following on the mortgage ..

Then coming to the sale certificate we find that it certifies that the respondents had purchased -/5/4 share in the village with abadi, khudkashat, chhot, agha& and all rights pertaining to the share. It is true that

Pratap Cltand

Ram Naroy•n

Pratap Chand

Ram Narayan

Wanclaoo ].

khudkashat and chhotaghas are specifically mentioned in the sa.le ctificate but the words "a.ll rights pertaining to the share" appearing in the sa.le certificate would include such proprietary rights in the sir land as belonged to the share mentioned in the sale

certificate. We are, therefore, of opinion tha.t so far as sir la.nd is concerned, the proprietary right in it pertaining to -/5/4 share was mortgaged a.nd the respondents by their sale certificate got a right in the sir la.nd also.

Now what happened after the mortgage deed in favour of the respondents was that . the a.ppella.nt purchased the entire -/10/8 share of Ra.JY\chanda.r subject to the mortgage of the respondents in 1932. At that time Ramcha.nda.r became an ex-proprietary tenant of his entire sir relating to this share under s. 49 of the Tenancy Act. In 1936 Ramchanda.r was ejected from the ex-proprietary tenancy which came in the possession of the appellant as Iambarda.r and ha.s apparently since then remained in his possession. The case of th.e respondents is that in 1936 their mortgage was subsisting and the sir Ia.nd which thus came into the possession of the appellant on the extinction of the ex-proprietary tenancy became in accession to. the mortgage and, therefore, they as mortgagees were entitled to ha.If share in the lands which thus ca.me into the possession of the appellant. We ha.ve a.lrea.dy pointed out tha.t the mortgage covered the sir plots also so fa.r a.s the proprietary rights in them were concerned. Therefore, when Ramcha.ndar's ex-proprietary rights came to an end and the land came into the possession of the appellant a.nd became khUdkashat, the mortgage would cover this khudkashat land to the extent of the mortgagees' share therein. It is true that if Ramchandar's ex-proprietary tenancy ha.d continued, the mortgagee would have no right to a.sk for ha.If share in it; but when the ex-proprietary tenancy wa.s extinguished a.nd this land came in the. possession of the la.mba.rdar (mortgagor) it wa.s a.n accession to the mortgage under s. 70 of the Transfer of Property Ac.t a.nd the mortgagees could claim a. share in it. It was however urged that a.ooel!llion to be available to

the mortgage must be a legal accession.

We however see no illegality in the accession which took place.

There is also no doubt that the accession took place

when the mortgage was still subsisting. Therefore, we agree with the High Court that on the ex-proprie tary tenancy being extinguished, the sir land which would otherwise have remained in the exclusive possession of Rrrmchan<lar as an ex-proprietary tenant became an accession to the mortgaged proper.ty and the respondents would he entitled to half of it on their purchasing the -/5/4 share in execution of the decree on t.he mortgage. The fact that the rent of an exproprietary tenant is due to the person whose exproprietary tenant _he becomes by virtue of the sale or mortgage with possession would make no <lifference after ex-proprietary tenancy is extinguished, for on such extinction the land would go to the entire proprietary body and would thus in this case be an accession to the mortgage to the extent of the share mortgaged.

This brings us to the lands in the name of Ramchandar's mother. It appears that these, lands came into the possession of Ramchandar after the mortgage but before the institution of the mortgage suit. They were nominally recorded in the name of his mother and ill 1932 after his entire share was purchased by the appellant he was recorded as an occupancy tenant of these lands. Later the appellant

came into possession of them apparently as a Iambardar. It is not clear when and how the appellant got possession of them. There can be no doubt however that his possession was for the entire body of proprietors and the respondents would be entitled to a share in them. But it was urged that the claim of the respondents to these lands was barred by 0. II, r. 2 of the Code of Civil Procedure, because they were not specified in the plaint based on the mortgage deed of

1920. Reliance in this connection is placed on Hazaiilal v. Hazarima/, (1) and Seth Manakchand v. Ghaube Manoharla/, ('). These cases in our opinion do not apply, because they are cases of foreclosure while in

!>I A.LR. 1944 P.C. 46,

Pratap Ch"11d

Ram Narayan

U'anchoo J.

Pratap Chand v.

Rani ~\'arayan

lVa1'lchoo ].

922 SUPRE.\fE COURT REPORTS [1961]

the present case the respondents' suit was for sale of the share mortgaged with them. Further in the plaint, when specifying the khudkashat plots it was made clear that they were khudkashat on the date of the mortgage; the respondents thus did not specify the khudkashat plots on the date of the plaint. Though they had specified some plots in the plaint which were mentioned in the sale certificate also, the snit was for the sale of the entire -/5/4 share and that would inclurle khudkashat lands pertaining to the share existing at the time when the suit was filed. It is not necessary in a suit for sale to specify the lands in the possession of the mortgagor specifically and they would pass on sale along with the share sold. The claim, therefore, would not be barred under 0. II, r. 2, on the ground that these plots entered in the name of the mother of H.amchandar were not pecifically mentioned in the plaint.

This leaves certain lands which came into the possession of the appellant as a lambardar in the ordinary conrne of management. The respondents would clearly be entitled to a share in these lands also on payment of proportionate expenses incurred by the appellant in the course of suits in which he came into possession. This is what the High Court has ordered and we see no reason to disagree with that view.

The appeal, -therefore, fails and is hereby dismissed with costs.

Appeal di.qmissed.

913

PRATAP CHAND

ANOTHER. (P. B. GAJENDRAGADKAR

s. 70

Ramr.handar

Ramchandar

s. 50

Sections 49 and 50

Pratap Chand

Ram Narayan

Ram. chandar

s. 70

Transfer of Property Act

Ramchadar

CIVIL Al'PELLATE JURISDICTION

M. O. Betalvad

Purslwtfam Trikamdas

T. Kkirwadkar

I. N. Shroff

Achhru Ram

A. R. Okaubey

N aunit Lal

Won.Ano J.

W ANOHOO

Nagpur High Court

Ram. chandar Jat

July 27, 1920

Seth ltam Jiwan

Ram Narain

Radhey Sham

August 27, 1926

Ramchanda.r who

July 27, 1932

Ra.mchandar

March 1, 1940

April 12, 1940

Ramchanda.r became

Ramcha.ndar was

Ramchanda.r's

Ram Na1aya

flam Narayan

October 20, 1943

.Ramchandar

ss. 68 and 69

Section 68

s. 69

s. 2

s. 2

ss. 49 and 50

s. 49

s. 50

s. 49

s. 50

Sections 49 and 50

s. 50

s. 50

s. 50

s. 50

s. 50

s. 50

s. 49

Ramcha.ndar's

s. 70

the Code of Civil Procedure

H.amchandar


...

3S.C.R.

SUPREME COURT REPORTS

COMMISSIONER OF INCOME-TAX,

ANDHRA PRADESH

M/S. BHIKAJI DADABHAI & CO.

(J. L. KAPUR, M. HrnAYATULLAH and J. C. SHAH, JJ.)

Income-tax-Assessment proceedings pending-Hyderabad Inc 1 odme-tax Act repealed-Penalty, whether. an additional tax-If ' .. t cou be imposed-Appellate Assistant Commissioner-Jurisdiction-- l Assessment, meaning of-Hyderabad Income-tax Act, s. 40-Indian Income-tax Act, r922 (XI of r922)-Finance Act, r950 (XXV of I950), s, IJ.

The Income-tax Officer found that the respondents' books of accounts were unreliable and after assessing income for Fasli year 1357, corresponding to the year 1946-47, issued notice to the respondents on December 22, 1949, under s. 40 of the Hyderabad Income-tax Act to show cause why penalty should not be levied in addition to the tax and by an order dated October 31, 1951, directed payment of the said penalty. The State of Hyderabad merged with the Indian Union during the pendency of the proceedings before the Income-tax Officer and by s. 13 ot the Finance Act, 1950, the Hyderabad Income-tax Act ceased to have effect from April I, 1950, but the operation of that Act in respect of levy, assessment and collection of income-tax and super-tax in , respect of periods prior thereto for which liability to income-tax could not be imposed under the Indian Income-tax Act, was saved. The question was whether (a) the Income-tax Officer had power on October 31, 1951, to impose a penalty under s. 40(1) of the Hyderabad Income-tax Act and (b) whether the assessee had a right to appeal against the order of the Income-tax Officer imposing penalty and whether the Appellate Assistant Commissioner had jurisdiction to hear appeals or whether his order was a nullity.

Held, that the power of the Income-tax Officer to impose a penalty under s. 40(1) of the Hyderabad Income-tax Act in respect of the year preceding the date of the repeal of the Hyderabad Income-tax Act was not lost because by s. 13 of the Finance Act, 1950, for the operation by the Hyderabad Incometax Act in respect of levy, assessment and collection of income ... tax and super-tax in respect of periods prior to April, r95r, for which liability to income-tax could not be imposed under the Indian

Incometax Act, was aved and so the proceedings for imposing the penalty could be continued after the enactment of s. 13(1) of the Indian Finance At. 1950.

Held, that the appeal against the order of the Income-tax Officer on the ground that he was not competent to pass the order did lie to the Appellate Assistant Commissioner, whose jurisdiction was not made conditional upon the competence of the

~ [~

Commissioner of

Inconieta:r, A ndhra Pradesh

v M /s, Bhikaji Dadabhai & Co.

Shah .f.

Income-tax Officer to pass the orders made appealable; as a court of appeal he had jurisdiction to determine the soundness of the conclusions of the Income-tax Officer both on the question of fact and law and even as to his jurisdiction to pass the order appealed from, and his order was not a nullity.

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 434 of 1960.

Appeal by special leave from the judgment and order dated October 4, 1956, of the Hyderabad High Court in I.T.R. No. 116/5 of 1954-55.

K. N. Rajagopal Sastri and D. Gupta, for the appellant.

A. V. Viswa11atha 8astri, S. N. Andley, J.B. Dadachanji, Rameshwar Nath and P. L. Vohra, for the respondents.

1961. February 22. The Judgment of the Coul't was delivered by

SHAH, J.-M/s. Bhikaji Dadabhai & Co.-hereinafter called the assessees-owned an oil mill at Khammamath in the area of the former State of Hyderabad.

For the year of assessment Fasli 1357 (October l, 1946, to September 30, 1947), the assessees returned an income. of Rs. 50,384/-. The Income-tax Officer found that the books of account maintained by the assessees were unreliable and by his order dated February IO, 1950, he assessed their total iricoine at Rs. 1,63,131/-. The Income-tax Officer had, before finalising the assessment, issued on December 22, 1949, a notice to the assessees under s. 40 of the Hyderabad Income-tax Act requiring them to show cause why penalty should not be imposed upon them and by order dated October 31, 1951, directed the assessees to pay by way of penalty Rs. 42,000/- in addition to the tax. This order was confirmed in appeal by the Appellate Assistant Commissioner. In appeal, the Income-tax Appellate Tribunal observed that by virtue of the provisions of s. 13 (I) of the Indian Finance Act, 1950, the Hyderabad Income-tax Act had ceased to have effect and as the power to impose penalty under s. 40 of the Hyderabad Income-tax Act was not saved, the order imposing penalty was without jurisdiction, The Tribunal observed ;

' ~·

3 S.Q.R.

SUPREME COURT ttEPORTS !)25

"The Income-tax Officer may have been in error in imposing the penalty, but there was no appeal against the order of the Incorne-t.ax Officer to the Appellate Assistant Commissioner. Section 42(1) of the Hyderabad Income-tax Act gives a right to an assessee to appeal if he objects to an order under s. 40 made by an Income-l>ix Officer.

Section 40 ceased to have effect.

There can therefore be neither an order under s. 40 nor an appeal against the order if an order has been wrongly made. The remedy of the assessee lies elsewhere, and not by way of an appeal to the Appellate Assistant Commissioner,'' and on that view dismissed the appeal.

At the instance of the assessees, the following questions were refen e<l by the Tribunal to the High Court of Judicature at Hyderabad : 1.

Whether on 31-10-1951, the lncorne, tax Officer, Warrangal Circle, had the power to impose a penalty under s. 40(1) of the Hyderabad Income-tax Act in respect of the ass.essment for the year 1357 F. ?

Whether the assessee had a right to appeal against the order of the Income-tax Officer imposing the penalty ? ·

3. If the Appellate Assistant Commissioner did not have jurisdiction to hear the appeal, whether the order of the Appellate Assistant Commissioner is a nullity and therefore the order of the Income-tax Officer erroneous, though it may stand until it is set aside by a competent authority ?

The High Court answered the firstand the third questions in the negative and the second question in the affirmative. Tho High Court observed that the Appellate Assistant Commissioner had power to entertain the appeal in which the question of the power of the Income-tax Officer to impose a penalty was challenged, and the decision of the Appellate Assistant Commissioner was not without jurisdiction.

The High Court also proceeded in a petition separately filed by the assessees to direct the Income-tax Appellate Tribunal to set a.ide the order of the Income-tax Officer imposing a penalty as a logical

Cowniissioner of

Income-tax.

Andltra Pradcsl~

v • . Hfs. Bltikaji Dadabhai & Cu.

Co1n11tissioncr of

Jnconie-tax, Audkra Pradesh

v • .11 /s. Bhikaji Dadabltai G Co.

Shah J.

926 ::lUPRl£illE COUHT ltEPOHTS [ 11161]

consequence of the view the Tribunal had taken regarding the absence of power in the Incom~-tax Officer to levy a penalty. Against the order passed by the High Court, this appeal with special leave is preferred.

We are in agreement with the High Court that the appeal to the Appellate Assistant Commissioner was competent. Even if tlbe Income-tax Officer committed an error in passing the order imposing penalty because the couditions necessary for invoking tL;;, t

jurisdiction were absent, an appeal against his order on the ground that he was not competent to pass the order did lie to the Appellate Assistant Commissioner.

The Appellate Assistant Commissioner is under the Act constituted an appellate authority against certain orders of the Income-tax Officer, and exercise of that jurisdiction is not made conditional upon the competence of the Income-tax Officer to pass the orders made appealable. The Appellate Assistant Commissioner had as a court of appeal jurisdiction to determine the soundness of the conclusions of the Income-tax Officer

both on questions of fact and law and even as to his jurisdiction to pass the order appealed from.

\Ve are, however, unable to agrte with the High Court that because of the repeal of the Hyderabad Income-tax Act by the Finance Act, 1950, the power to impose a penalty in respect of the years preceding the date of repeal was lost. The State of Hyderabad merged with the Indian Union during the pendency of the proceedings before the Income-tax Officer. There- ;;, fter the Indian Legislnture enacted the Finance Act,

l \);10, which by sub-section (I) of s. 13 in so far as it is material provided :

"lf immediately Lefore the 1st, day of April, 1950, Lherc is in foree in any part B Stace .... any Jaw

relating to iucome-tax or super-tax .... that Jaw slmll cease to have effect except for the purposes of the kv y, assessment and collection of income-tax

and super-tax in respect of any period not included in the previous year for the purposes of assessment under the Indian Income-tax Act, 1922 ... "

" , _

Manifestly, bys. 13, the Hyderabad Income-tax Act ceased to have effect as from April 1, 1950. But the operation of that Act in respect of levy, assessment and collection of income-tax and super-tax in respect of periods prior thereto for which liability to incometax could not be imposed under the Indian Income-tax Act, 1922, was saved. The J udicia.l Committee of the Privy Council in Commissioner of lncome-wx, Bombay Presidency and Aden v. Messrs. Khemchand Ramdas(') observed:

" One of the peculia.ri ties of most Income-tax Acts is that the word ' assessment' is used as meaning sometimes the computation of income, sometimes the determination of the a.mount of tax paya. hie and sometimes the whole procedure laid down in the Act for imposing liability upon the tax

payer." ':l'heHydera.ba.d Income-tax Act also used the expression "assessment" in different senses. In certain sections, for instance ss. 31 and 39 the expression is used as in the sense of mere computation of income; iu other sections it is used in the sense of determination of liability and in certain other sections in the sense of machinery for imposing liability and procedure in that behalf. By the Fina.nee Act, 1950, the Hyderabad Income-tax Act was expressly kept alive in respect of periods which include the assessment year in question for purposes of levy, assessment and collection of income-tax. The High Court expressed the view that the word "assessment" in s. 13 (1) included the whole procedure for imposing liability upon the taxpayer but not to the procedure for imposing a. penalty. They thought that the Hyderabad Income-tax Act dealt with liability to pay income-tax and penalty in distinct provisions, both relating to imposition and recovery and that if the Legislature had intended to keep alive the Hyderabad Income-tax Act for a.11 purposes including the levy of penalty with respect to any particular year or yea.rs of assessment, it could have said so in terms clear and unambiguous instead of limiting the operation only to "levy, assessment and. collection." In the view of the High Court, imposition of penalty

(r) (r938) L.R. 65 I.A. 236; [1938] 6 I.T.R. 4t4.

r961

Com111issio11er of

1J1come-tax, .A JJdlira Pradesh

M /s. Bkikaji Dadabhai 6- Co.

Sliahj.

Commissioner of

lncolne-ta.v, AHdhra Pradesh v.

M /s. Bhikaji Dadabhai & Co.

Shah j.

928 SUPREME {jQUR'.1.' REPORTS [ l961J

was not a necessary concomitant or incident of the process of assessment, levy and collection of tax.

The High Court proceeded upon the view that by saving the Hyderabad Income-tax Act for the purposes of levy, assessment and collection of income-ta.x, the entire procedure for imposing liability to pay tax and for collection of tax w:s saved, but penalty not being ta.x, provisions relating to imposition of aud collection of penalty did not survive the repenl of the Hyderabad Income-tax Act.

This Court considered in C. A. Abraham v. The Income-tax Officer, Kottayam (') the question whether the expression "assessment" ns used in s. 44 of the Indian Income-tax Act included the procedure for imposition of penalty in respect of a dissolved firm and it was observed:

" The expression ' assessment ' used in these section~ (pro, isions of Ch. IV of the Indian Income-tax Act) is not used merely in the sense of computation of income and there is in our judg1111rnt no ground for holding that when by s. 44, it is declared that the partners or membPrR of the <1Ssociation shall be jointly and severally liable to aHsc., Hment, it is only intended 'to. dedarn the liability to computation of income nuder s. 23 and not to the itpplication of the procedure for declaration and im posit.ion of tax liabilitv and the machinerv for enforcement thereof ...... By s. 28, the liability to pay additional tax which is designated penalty is imposed in view of the dishonest or contumitcious conduct of the assessee.') This coUl't regarded penalty as an <>dditio1rnl tax imposed upou it pernon in , icw of his dishonest <r contumacious conduct. fL is true that unde1 the Hyderabad Income-tax Act, distinct provisious arc made for recovery of tax due and pena.Jty, butt.hat iu our judgment <foes not alter the true character of pena!tyimposed under the t.wo Acts. !\or are we able to agree that because in respect of the Sea Customs Act, 1878, the Indian Tariff ..\ct, 1934, the Land Customs Act, l!J24, the Central .Excise nnd t:lalt Act, 1944, and the Indian Post Offices Act, 1898, which were extended

(r) [1961] 2 s.c.R. 765.

to the whole of India by s. 11 of the Finance Act, 1950, and the provision~ corresponding thereto were repealed by the proviso, and it was expressly provided that the previous operation of the corresponding law or any penalty, forfeiture or punishment ordered in respect of an offence committed against any such law or any investigation, legal proceeding or remedy in respect of Rta:h penalty, forfeiture or punishment or any such investigation, legal proceeding or remedy mav be instituted, continued or enforced and any such penalty, forfeiture or punishment may be imposed as if the Act had not been passed, that under sub-s. (1) of s. 13 it was intended to prohibit the authorities otherwise competent in that behalf from commencing or continuing the proceeding for levying penalty even if the circumstances justi(y such a course.

The scheme of the statutes specified in s. 11 and which are repealed by sub-s. (2) of s. 13 are somewhat different from the scheme of the Indian Income-tax Act.

Because by sub-s. (I) of s. 13 of the Finance Act, 1950, the Hyderabad Income-tax Act was to cease to operate as on April I, 1950, except for the purposes of levy, assessment and collection of income-tax and super-tax, whereas in respect of other Acts specified in s. 11 substantially provisions similar to those contained in s. 6 of the General Clauses Act were enacted, an intention that proceedings for penalty may be commenced and continued under the Acts specified ins. 11, whereas no snch proceedings may be commenced or continued under the Hyderabad Income-tax Act is not indicated. We are of the view that the High Court erred in holding that the proceedings for imposing .the penalty could not be continued after the enactment of s. 13 (1) of the Finance Act, 1950.

The appeal will therefore be allowed and the answer to the first question will be recorded. in the affirmative.

On the view taken by us, it is unnecessary to pass any orders on the petition under Art. 226 of the Constitution which was presented to the High Court. The appellant will be entitled to his costs of the appeal in. this Court and in the High Court.

Appeal allowed,

Con1mission1r of

Incon1e-1ax, A ndhra Pradesh

v. i\1 js. Bhikaji Dadabhai & Co.

Shah].

M/S. BHIKAJI DADABHAI & CO

L. KAPUR

C. SHAH, JJ.

Hyderabad Income-tax Act

s. 40

Indian Income-tax Act

December 22, 1949

s. 40

Income-tax Act

State of Hyderabad

s. 13

Finance Act, 1950

Income-tax Act

April I, 1950

Income-tax Act

October 31, 1951

s. 40(1)

Income-tax Act

s. 40(1)

Income-tax Act

Income-tax Act

s. 13

Finance Act, 1950

s. 13(1)

Bhikaji Dadabhai & Co.

CIVIL APPELLATE JURISDICTION

Hyderabad High Court

K. N. Rajagopal Sastri

D. Gupta

A. V. Viswa11atha 8astri

S. N. Andley

J.B. Dadachanji

Rameshwar Nath

P. L. Vohra

SHAH

Bhikaji Dadabhai & Co.-hereinafter

s. 40

Income-tax Act

s. 13

Indian Finance Act, 1950

Income-tax Act

s. 40

Income-tax Act

Section 42(1)

Income-tax Act

s. 40

Section 40

s. 40

High Court of Judicature at Hyderabad

s. 40(1)

Income-tax Act

Andltra Pradcsl~

Bltikaji Dadabhai

Bhikaji Dadabltai G Co.

Assistant Commissioner

s. 13

Indian Income-tax Act, 1922

Income-tax Act

April 1, 1950

Indian Income-tax Act, 1922

Income-tax Act

ss. 31 and 39

Income-tax Act

s. 13

Income-tax Act

L.R. 65 I.A. 236

Income-tax Act

Income-tax Act

s. 44

Income-tax Act

IV of the Indian Income-tax Act

s. 44

s. 23

s. 28

Income-tax Act

Sea Customs Act, 1878

Customs Act

Indian Post Offices Act, 1898

India

s. 11

Finance Act, 1950

s. 13

s. 11

s. 13

Income-tax Act

s. 13

Finance Act, 1950

Income-tax Act

s. 11

s. 6

General Clauses Act

Income-tax Act

s. 13

Finance Act, 1950

Art. 226


930 SUPRE'>fE COURT REPORTS [1961]

RAJE ANANDRAO v.

SHAMRAO AND OTHERS. (P. B. GAJENDRAGADKAR and "!(. N. W ANCHOO, JJ.)

Rtligious Endowmeni-Suit under s. 92, C.P.C.-Scheme providing for modification in future-Modifications, if can be made by application or separate suit-Code of Civil Procedure, 1908 (V of I908). s. 92.

The appellant was the trustee of a temple, which was an endowment for the public by his ancestors, and the respondents were its Pujaris with hereditary rights. Dissatisfaction with the management of the temple having arisen a suit under s. 92 of the Code of Civil Procedure was filed in which it was finallv decided that the office of the Pujaris was hereditary and they were subject to the control of the appellant. Some of the Pujaris were not parties to the suit but they were bound by the scheme framed therein as members of the worshipping public. Subsequently again trouble arose and on the report of a commissioner appointed to investigate the working of the temple, the District Judge passed an order by which he revised the scheme which was then in force. The Pujaris went to the High Court .in revision which was allowed. On appeal by special leave the main question arising for decision was how far it was open to the Court to amend a scheme once framed under s. 92 of the Code of Civil Procedure where a power to amend the scheme is reserved in the Scheme itself.

Held, that in a suit under s. 92 for the settlement of a scheme it was open to provide in the scheme for modifying it whenever necessary by inserting a clause to the effect.

A suit for the settlement of a scheme is analogous to an administration suit and so long as the modification in the scheme is for the purpose of administration, such modification can be made by an application under the relevant clause of the scheme without the necessity of a separate suit under s. 92 of the Code of Civil Procedure the provisions of which are not violated by such a procedure.

Chandraprasad Ramprasad v. ]inabharthi Narayanabharthi

(1931) I.LR. 55 Born. 414, Sri Swami Rangacharya v. Gangaram

(1936) I.L.R. 58 All. 538, Umeshananda Dutta ]ha v. Sir Ravaneswar Prasad Singh (1912) r7 C.W.N. 84r, Manadananda ]ha v.

Tarakananda ]ha Panda A.LR. 1924 Cal. 330, Srijib Nyayatirtha v.

Sreemant Dandy Swami J agannath Ashram A.LR. 1941 Cal. 618, Mahomed Waheb Hussain v. Syed Abbas Hussain A.LR. 1923 Pat. 420 and Gangaram Go1•i11d Pashankar v. Sardar K. R. Vinchurkar I.LR. (1947] Born. 466, approved.

Prayaga Doss Jee Varu v. Tirumala Anandam Pillai Purisa Sriranga Charylu Vam (r907) L.R. 34 I.A. 78 anrt Sevak

3 ~.C.R.

SUPRE~IE COlJltT REPOHTS 931

Kirpashanker Daje v. Gopal Rao Manohar Tambekar (1913) 24 M.L.J.

199, referred to.

Veeraraghavachariar v. The Advocate-General of Madras [19281 I.L.R. 51 Mad. 31, disapproved.

A suit under s. 92 is a representative suit and binds not only the parties to the suit but all those who are interested in the trust. The mere fact that the Pujaris were not parties to the suit would not take away the jurisdiction of the District Judge to modify the scheme, if the modification was with respect to the administration of the trust and if it did not affect the private rights of the Pujaris.

Crvm APPELLATE

.JURISDICTION: Civil Appeal No. 370 of 1956.

Appeal by special leave from the judgment and order dated November 25, 1955, of the former Nagpur High Court, in Civil Revision No. 333 of 1954.

A. V. Viswanatha Sastri, Shankar Anand and Ganpat Rai, for the appellant.

W. S. Barlingay and A. G. Ratnaparkhi, for the respondents.

1961. February 23. The Judgment of the Court was delivered by

Raje Anandrao v.

Shamrao

WANCHOO, J.-This is an appeal by special leave Wanchoo J. against the judgment of the Nagpur High Court. The brief facts necessary for present purposes are these : There is an ancient temple of Balaji at Deolgaon Raja in the Buldana District.. Before 1866 the management of the temple was in the hands of a family bearing the name of 1 ad.

A suit was filed in 1866 with respect to this temple by Raje Mansingh Rao under the guardianship of his mother for a declaration that the temple was his property. The defendants in that suit were certain pujaris. The suit was decreed by the first court but on appeal it was held that the temple was not the private property of the Raja but was an endowment for the public founded by the ancestors of the Raja and that the Raja was entitled as against the puja.ris to the possession and control of the institution.

A receiver was appointed during the minority of the Raja. but in due course the Raja. took over the direct management of the temple. In 1872 it seems that there was some dispute between the Raja and the pujaris whose offices were also hereditary ; and an agreement

Raj8 Anandrao v.

Shamrao

fV anchoo J.

was arrived at between them. By this agreement it was provided that any offerings up to Rs. 5/- would go to the pujaris who were to defray the expenses of dhoop, deep and neivedya from this amount keeping the balance to themselv.es. There were also certain provisions in the agreement as to offerings in kind. The agreement also provided for other matters relating to worship and imposed certain duties on the pujarls.

Finally, it provided that the parties should carry on all the duties stated in the agreement and other duties besides them as before according to the usual wahiwat and that earnings would be taken as stated in the agreement and proper arrangement of expenses would be kept and the pujaris woul<l take all possible care not to take more than what was fixed in the agreement. This agreement seems to have held the field. thereafter till we come to 1904.

It seems that there wasdissatisfaction with the management.of this temple by Raje Anandrao and in consequence a suit was filed after obtaining permission of the Advocate-General in February, 1904, for framing a scheme for the management of the temple. This suit was finally decided on April 29, 1916, by the Additional Judicial Commissioners. They set aside the order of the trial court. for the removal of l:taje .

Ana.ndrao from the management by declaring that the right to manage the affairs of the shrin~ which was an office waEI hereditary in the family of the Raja ; hut they further held that a scheme should be framed providing-

"(i) for the management of the trust pending any dispute as to who is the present holder of the office of trustee and manager ;

(ii) for the management of the trust during the minority of the appellant if he should be established to be the present Raja.;

(iii) for the continua.nee of co9trol by the Court after the present hereditary incumbent enters upon the office of manager sui juris ; and

(iv) for the modification of the scheme from time to time as circumstances may demand. " In consequence the matter went ha.ck to the District Judge who framed a scheme on February 16, 1918, for

the management of the temple. This scheme was later substituted by , another scheme dated November 25,

1926. Finally, on October 16, 1935, another scheme was framed in substitution of that framed in 1926. It may be mentioned that the pujaris as such were not parties to this suit in which the scheme was framed, though they would be as much bound by it as mem':. hers of the worshipping public as .the parties to it. It seems that a.bout. that time there. was another suit pending in the court of the Additional Subordinate Judge, II Class, Buldana, between the appellant and the pujaris. That suit was decided on April 30, 1936, and it was held therein that the agreement of 1872 which was binding on the appellant recognised that the olfice of pujari was hereditary. It was also held that the trustee (namely, the Raja) was entitled to control the pujaris in the exercise of their rights and to see that they performed their duties properly. In other words it was held that the pujaris were entitled to retain their office during good behaviour. It was also he1d that the hereditary riature of their right had not invested them with any immunity from all control and they were not entitled to act with impunity and yet retain their office. It was further held that they could not establish a right to enjoy the fruits of their office though absolutely incompetent to do so. Further it was held that the power of dismissal in the event of misbehaviour undoubtedly belonged to the Raja but that it should not be lightly exercised and should be subject to the control of the District Judge. Finally it was made clear that the Raja had no right to dispose of any part of the income of the pujaris nor had he any right to interfere in matters of succession amongst them. The office of pujari was thus held to be hereditable unless there was misconduct or misbehaviour which caused forfeiture. A declaratory decree was therefore passed to the effect that the pujaris who were defendants in that suit were holding hereditary office of the pujaris of Shree Balasaheb Sansthan and that they were in the discharge of their duties subject to the control of the plaintiff (namely, the Raja.) and they were bound to respect his authority and rightful

Raje AnandYao

Shanira"

Wanchoo ].

Raje Anandrao

Shanirao

lVancJioo j.

orders and that. they held their office subject to good behaviour.

Next we come to the year 1953. It seems that there was some trouble in the temple and consequently the District Judge visited the place on November 30, 1953.

At that time it was agreed that a Commissioner with wide terms of reference be appointed to investigate the working of the temple vis-a-vis the pujaris, the trustee and the general public and he should report how far the present scheme was working, what were the defects and shortcomings and what new proposals or alterations in the scheme and in the agreement of 1872 were necessary in the light of the working till then and the changed circumstances.

Many of the pujaris-respondents who were present on that date were agreeable to this course. Eventually, the Commissioner reported to the District Judge and objections were called to that report. The matter was then gone into and the District J u<lge passed an order on April 12, 1954, by which he revised the scheme which had been in force since 1935.

Thereupon the pujaris went in revision to the High Court and their contention was that the District Judge had acted beyond his jurisdiction in revising the scheme in so far as it affected them. The High Court went into the question whether the District Judge had any power to modify the scheme and came to the conclusion that if the matters sought to be introduc. ed by modification of the scheme are covered by s. 92 of the Code of Civil Procedure, an applicatfon for modification is not the appropriate remedy. It further held that unless the power reserved to the court under the scheme is invoked for a purpose analogous to execution of the decree, no modification of the scheme was possible under s. 92. It therefore held that unless the rights of any persons were the subject of lis, the scheme could not be modified so as to affect them except by a suit under s. 92. Fina.Uy, it ca.me to the conclusion that as the puja.ris were not parties to the suit of 1904 or to, the scheme that was framed, it was not possible to modify the scheme so as to affect their rights without recourse to s. 92. The

revision was therefore allowed and the scheme framed by the learned District Judge was ordered to be read subject to the order of the High Court.

Thereafter an application was made by the appellant to appeal to this Court, which was later converted into an application for review of the earlier order.

This application was rejected. Then the appellant applied to this Court for special leave and obtained the same ; and that is how the matter has come up before us.

The main question that arises in this appeal is how far it is open to a court to amend a scheme once framed under s. 92 of the Code of Civil Procedure, where a power to amend the scheme is reserved in the scheme itself. It is not seriously disputed in this case that the power to amend the scheme has been reserved in view of the judgment of the Additional Judicial

Commisioners already set out above and paragraph 17 of the scheme dated October 16, 1935. The High Court has held that as the pujaris were not parties to the suit under s. 92, the scheme could not be amended so as to affect their rights, for even where a power is reserved in the scheme to modify it, it could only be invoked for a purpose analogous to execution of a decree. It is the correctness of this view which has been challenged before us.

The leading case in support of the view taken by the High Court is Veeraraghavachariar v. The Advocate- General of Madras (1). It was held in that case that-

" if in a decree for a scheme framed under s. 92, Civil Procedure Code, liberty is given to persons to apply to the Court for directions morely to carry out the scheme already settled, such reservation of liberty in the decree will be intra vires if the assistance of the Court can he given without offending s. 92; but where liberty is given to apply to the Court for alteration or modification of the scheme, such reservation is ultra vires as offending s. 92." On the other hand the 1'3ading case ta.king the opposite view is Ohandrapmsad Ramprasad v. Jinahharathi Narayana bharathi('). In that case the scheme

(t) (1928)1.L.R. ;1 Mad,31.

(z) (1931) l.I •• R. ;; Bom. 414

Raje AnandY•O

lV anclroo J;

Raje Anandrao

Sl&a, nrao

Wanekoo ].

authorised the District Court to remove a trustee and also to alter or amend the scheme upon an application of a party interested or on its own initiative after giving public notice. An application was made to the District Court for the removal of certain trustees and for the modification of the scheme. The District Judge dismissed the application on the ground that the proper remedy of the applicant was by a separate suit under s. 92 of the Code of Civil Procedure. On appeal, however, the High Court held that the Distnct Court was competent to grant the reliefs asked by virtue of the powers conferred upon it under the rules of the scheme and that no separate suit under s. 92 of the Code of Civil Procedure was necessary. Fur- tber it held that the rule which gave power to the court which sanctioned the scheme to alter or modify it was not ultra vires.

The view taken by the Bombay High Court as to the power to modify the scheme by application if such power is reserved in the scheme has been followed by the Allahabad High Court in Sri Swami Rangacharya

v. Gangaram ('). The Calcutta High Court has also accepted the view that where there is a provision in a scheme for its modification it can be modified by an application; (see UtnMhananda Dutta Jha v. Sir

Ravaneswar Prasad Singh (2 ) Manadananda Jha v.

Tarakananda Jha Panda(') and Srijib Nyayatirtha v ..

Breeman! Dandy Swami Jagannath Ashram(')). The Patna High Court also in Mahomed Waheb Hussain v.

Syed Abbas Hussain(') held the same view. In Gangaram Govind Pashankar v. Sardar K. R. Vinchurkar (6), the Bombay High Court bas gone further 'and held that the court had inherent power under s. 151 of the Code of Civil Procedure to alter a scheme even in the absence of a clause giving " liberty to apply " if circumstances have subsequently arisen which make it desirable for it to be altered to meet the ends of justice.

Reference was also ma.de ttf two decisions of the Privy Council. In Prayaga D0&s Jee Varu v. Tirumala

{I) (1936) l.L.R. 58 All. 538.

(2) (1912) 17 C.W N. 841.

(3) A.J.R. 1924 Cal. 330.

(4) A.!.R. 1941 Cal. 618, (51 A.l.R. r923 Pat. 420.

(6) J.L.R. [1947) Bom. 466.

Anandam Pillai Purisa Sriranga Oharylu Varu (1), the Privy Council itself framed a scheme and one of the terms in the scheme was that liberty was reserved to persons interested from time to time to apply to the High Court for any modification of the scheme that may appear to be necessary or convenient. Similarly, in Sevak Kirpashanker Daji v. Gopal Rao Manohar Tambekar ('), the scht>me which was framed by the Privy Council in that case contained in cl. 20 a direction that the provisions of the scheme might be altered, modified or added to by an application to His Majesty's High Court of Judicature at Bombay. It is true that in these cases, the Privy Council was not considering whether such a clause could be legally inserted in a scheme; but the fact remains that in these two schemes the Privy Council did insert a clause in each authorising its modification by an application to the High Court.

Apart from authorities, however, let us see if there is anything in ~. 92 of the Code of Civil Procedure which militates against providing a clau8e in a scheme framed thereunder for its modification by an application to the court framing the scheme. Section 92 permits a suit in the case of any alleged breach of any express or constructive trust created for public purposes of a charitable or religious nature or where the direction of the court is deemed necessary for the administration of any such trust to be filed either by the Advocate-General or two or more persons having an interest in. the trust with the consent in writing of the Advocate-General. Reliefs that can be obtained under that section are-

" (a) removing any trustee;

(b) appointing a new trustee ;

(c) vesting any property in a trustee;

(cc) directing a trustee who has been removed or a person who has ceased to be trustee,· to deliver possession of any trust property in his possession to the person entitled to the 'possession of such property ;

(d) directing accounts and inquiries;

(>) (•907) L.R 3~ I.A. 78 (•) (t9l3] 2~ M.L.J 199.

Raje Anandrao

Shamrao

U' anclioo J.

Raje Antoidrao

Shamrao

H-" anrhoo j.

(e) declaring what proportion of the trust property or of the interest therein shall be allocated to any particular object of the trust;

(f) authorizing the whole or ttny part of the trust property to be let, sold, mortgaged or exchanged;

(g) settling a scheme; or

(h) granting such further or other relief as the nature of the case may require." Further sub-s. (2) of s. 92 bars a suit claiming the above reliefs unless the suit is filed in conformity with s. 92(1). In the present appeal we are concerned only with the modification of a scheme; we are not concerned with appointment or removal of trustees or any other matter enumerated in sub.s. (1) of s. 92: We do not therefore propose to consider whether it would be open to appoint or remo, e trustees etc., on the ground of breach of trust without recourse to a suit under s. 92.

We shall confine ourselves only to the question whether in a case where there is a provision in the scheme for its modification by an application to the court, it is open to the court to make modifications therein without the necessity of a suit under s. 92. So far as the scheme is concerned, s. 92 (1) provides for settling a scheme and if a suit is brought for this purpose it has to comply wit.h the requirements of s. 92(1); but where such a suit has been brought and a scheme has been settled, we see nothing in s. 92 (2} which would make it illegal for the court to provide a clause in the scheme itself for its future modification.

All that that sub-section provides is that no suit claiming any of the reliefs specified in sub-s. (1) shall be instituted in respect of a trust as is therein referred to except in conformity with the provisions of that sub. section. This sub-section therefore does not bar an application for modification of a scheme in accordance with the provisions thereof, provided such a provision can be made in the scheme itself. Under sub-s. (1} the court has the power to settle a scheme. That power to our mind appears to be comprehensive enough to permit the inclusion of a provision in the scheme itself which won!rl make it alterable by the court if and

o I

• ·-

•I /

when found necessary in future to do so. A suit under s. 92 certainly comes to an end when a depree is passed therein, including the settlement of a scheme for the administration of the trust. But there is nothing in the fact that the court can settle a scheme under s. 92(1) to prevent it from making the scheme elastic and provide for its modification in the scheme itself.

That does not affect the finality of the decree; all that it provides is that where necessity arises a change may be made in the manner of administration by the modification of the scheme.

We cannot agree that if the scheme is amended in pursuance of such a clause in the scheme it will amount to amending the decree.

The decree stands as it was, and all that happens is that a part of the decree which provides for, management under the scheme is being given effect to. It seems to us both appropriate and convenient that a scheme should contain a provision for its modification, as that would provide a speedier remedy for modification of the manner of administration when circumstances arise calling for such modification than through the cumbrous procedure of a suit.

In Veeraraghavachariar' s case (1 ), the Madras High Con.rt was cognizan.t of the two decisions of the Privy Council in wofiich "clauses had been inserted in the scheme providing for its modification by an application. But the learne"cl. judges were of the view that the point was never raised much less decided by the Privy Council and therefore it could not be said that the Privy Council was of the opinion that such a clause would be intra vires. They thought that inserting such a clause in the scheme would imply that the suit would remain pending for ever. It is not necessary to hold that a suit under s. 92 in which a scheme is framed providing such a clause is pending for ever. The scheme deals with the administrati<, m of the trust and for the purposes of the scheme it would not be wrong or improper to treat a suit under s. 92 as analogous to an administration suit.

On that view it would in our opinion be just and convenient to provide for a clause in the scheme which is framed for the administr&tion

I•) (1928) !.L.R. 51 !4ad. 3r.

Ig6I

Raje Anandr ao v.

S'hamrao

1-Vanchoo ],

Raje Anandrao v.

Shamrao

JVanchoo ].

SUPREME COURT REPORT3 [1961)

of the trust to allow for its modification by an application. We therefore accept the view of the Bombay, Calcutta, Allahabad and Patna High Courts in this matter and hold that it is open in a suit under ~- 92 where a scheme is to be settled to provide in the scheme for modifying it as and when necessity arises, by inserting a clause to that ffect. Such a suit for l he settlement of a scheme is analogous t_o an administration suit and so long as the modification in the scheme is for the purposes of administration, such modification can be made by applica.tion under the relevant clause of the scheme, without the necessity of a suit under s. 92 of the Code of Ci vii Procfdure. Such a procedure does not violate any provision of s. , 92. The view taken by the Madras High Court that insertion of such

a clause for the modification of the scheme is ultra vire8 is incorrect. It was therefore open to the District Judge in the present case to modify the scheme.

The next question is whether the modification in this case is for the purposes of administration alone for then it will be justified and within jurisdiction or whethe1' by this modification the private ights of the pujaris are in any way affected. It is true that the pujaris were not parties to the suit under s. 92 but the decision in that suit binds the pujaris as worshippers so far as the administration of the temple is concerned, even though they were not parties to it, for a suit

under s. 92 is a representative snit and binds not only the parties thjereto but all those who are interested in the trust. Therefore, the mere fact that the pnjaris were no parties to the suit will not take away the jurisdiction of the District , Judge to modify the scheme, if t.he modification is with respect to the administration of the tnrnt and if it does not affect the private right's of the puj1uis.

According to the High Court, the modification in the scheme was only with respect to three paragraphs, namely, paragraphs 3, 4 and 12.

Lea.med counsel for the pujaris has admitted that there is no modification in paragraph 4.

This is also clear from a comparison of paragraph 4 of the 1935 scheme with paragraph 4 of the revised scheme, for the two paragraphs are word for word the same. Sn

we are left with the modification in para.graphs 3 and

12. Paragraph 3 originally provided that " the managing trustee shall have authority to regulate the performance of the pooja according to usage which is not in any way repugnant to public interest and morals ", and to this part of paragraph 3, the revised scheme adds the words " but which encourages the use of vedic yagnik ''. Learned counsel for the pujaris admits that there can be nci objection to this addition, for it only brings out what was implicit in the okl scheme. Further the following addition is made to paragraph 3 in the revised scheme:-

,, The rules may provide, inter alia, that the persons actually doing the worship sl.10uld have the requ:site knowledge of the mantrik ritual and in case any one has not such knowledge, the actul worship and ritual may be performed by his substitute having such knowledge and he may not be allowed to do the worship himself.

These rules will be printed and published locally and shall be enforced by the trustee." Now the old paragraph 3 also provided for framing of rules with the approval of the District Judge after hearing the publie and the pujaris, for the worship of the deity. The revised paragraph il also contains a direction regarding the making of such rules with the approval of the District Judge after hearing the public and the pujaris. It has further been provided that such rules should be printed and published locally and should be enforced by the trustee. There can in our opinion be no objection to this addition, for the enforcement of the rules was already implicit in old paragraph 3 and their prin, ting and publication. is only a matter of convenience to all and can in no way affect the private rights of the pujaris. Learned counsel for the respondents did not object to this addition either.

He objects to that part of the addition which says that "the persons actually doing the worship should have the requisite knowledge of the mantrik ritual and in case any one has not such knowledge, the actual worship and ritual may be performed by his subst.itute having such knowledge." Now this provision merely

lVamhoo J.

Raje Auandrao

Shantrao

IVanchoo J.

says what the rules for pooja to be approved by the District Judge after hearing the public and the pujaris should provide among other things. This provision is on the face of it reasonable, for it is unthinkable that a pnjari, even though he may be a hereditary pujari, should perform puja, when he does not know anything about the mantrik rituals. Learned counsel for the respondents has no objection to this provision either except that he contends that the rule seems to give the right to provide a substitute to the managing trustee (namely, the appellant). As we read the ruk, however, we do not think that that is wh1tt it means.

All that it says is that where the hereditary puj1tri does not know the mantrik ritual, the puja may be performed by his substitute. It means that the substitute has to be provided by the pnjari and not by the managing trustee. The fact that the substitute is pujari's substitute has implicit in it that it is the pujari who has to provide a substitute in his place in case he does not know the rituals. Learned counsel for the respondent~ concedes that if this is the meaning of the addition in paragraph 3, there can be no objection to it. We therefore make it clear that when the addition in paragrnph 3 speaks of a substitute for the pujari wbo is ignorant of rituals, it is the pnjari who has the right to provide the substitute and not the managing trustee. So read, this addition does not in any way affect the private rights of the pujaris in the matter of puja. Thus the entire addition in paragraph 3 deals with the administration of the temple with respect to puja and with the clarification which we have given above there is no trespass on the private rights of the pujaris by this addition. Therefore, the revised paragraph 3 was within the jurisdiction of the District Judge and cannot be taken exception to on that score.

Turning now to paragraph 12 we find that .there are additions in that paragraph in the revised scheme and we shall deal with each addition seriatim: The first addition (i.e., cl. a) is that "the Raje Anandra.o shall have power to keep such dependants like kirtankars, puraniks, etc., for proper performanC'e of the religious

' f

3 S.C.R.

SUPHEME UOURT Rl<l'ORTS 943

rites of the deity customarily so performed and to tix their allowances or remunerations, as the case may be. " This addition does not in any way affoct the priv11:te rights of the pujaris; it deals with persons other than the pujaris who perform other duties beside the puja, like kirtan, reading of purans, etc.

The managing trustee (namely, the Raja) has been given the power to appoint such persons and to fix their allowances or remunerations. Obviously, such allowances and remuneration will not be paid out of the income which is secured to the pujaris under the agreement of 1872 and will have to come out of other income of the temple. If this provision is so readand this is the only way in which it can be read-the learned counsel for the respondents has no. objel'tion to this provision either. It relates to the admini,; t ration of the trust and does not, if read in the manner indicated above, in any way affect the private rights of the pujaris.

Then comes cl. \b), which is as follows:-

" Raje Anandrao, and in his absence, the manager or the agent of Raje Anandrao, will have power to grant leave to, or fine, or punish the pujaris for misconduct, as in the case of his office staff and otlier dependants because the responsibility is on the trustee to see that the puja is performed regularly and properly. The dismissal of the pujaris for misconduct or other reasons shall not be made without the previous sanction of the District Judge, West Berar." This clause again deals with the administration of the temple. We have already referred to the decision in the suit of 1935 between the appellant and the pujaris-respondents. In that suit it was made clear that the pujaris in the discharge of their duties were subject to the control of Raje Anandrao and were bound to respect his authority and rightful orders and that they held their office subject to good behaviour.

It is this decision inter parties which is being carried out in cl. (b), which has been added in the revised scheme. The power of control which the Raja has over the pujaris in the discharge of t.heir duties

ShamrtSO

lf'a.tif~ ].

Ig61

Raje Anandrao

Sht11nrao

Wattchoo ].

8UPRE:ME UOURT HEPORTS Ll961]

implies that he is the person to grant them leave or fine or punish them for misconduet, if they do not perform their duties regularly and properly. LearnPrl counsel for the respondents feels howevn that this power to punish might be misusPd by the H aja, for it is uncontrolled, unlike the power to disrnies which could only be exercised with the previous siinction of the District Judge. The clause as it stands therefore does not in any way affect the private rights of the pujaris and does not go beyond what was decided i11 the suit between them and the appellant. It concerns the administration of the temple and therefore it was within the jurisdiction of the District Judge to insert it in the scheme when revising it.

At the same time there may be something in the apprehension entertainNl by the pujaris that the power to punish may be abused.

We therefore think that in this clause a further sentence should be added to the following effect:-

" In case Raje Anandrao or his manager or agent fines or punishes the pujaris for misconduct, the pujaris will have the right to appeal to the District Judge against such orders and the order of the District .Judge thereon will be final. " Then we come to cl. (c) which is as follows:-

"The pujaris will be entitled to their shares in the offerings as per the agreement of 1872 after deduction of the expenses for the pooja, etc., as per my detailed remarks in my separate order passed today. The management will work out those instructions for day-to-day working in accordance with rules to be included in the puja rules." The main attack of the respondents is on this elause, for, according to them, it affects their right to offerings to which t, hey are entitled under the agreement of

1872. This clause is not self-cont"ined, for it refers to the detailed remarks in the separate order of the District Judge passed on that very d; iy and leaves it to the management to work out tho"e instructions for day to day working in accordance with rules to be included in the puja rules.

Now under the separate order of the same date it is provided that offerings up to

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! •

' ..

Rs. 5/- to which the pujaris are entitled subject to the expenses of dhoop, deep and neivedya according to the agreement of 1872 should be kept in a separate box which should be opened once every week, or fortnight or month or at any stated period as agreed by the pujar!s, in the presence of some respectable persons of the town and the signatures of the representatives of the pujari' and of the trnstees or his representative should be taken in a separate note-book to show (, he exact amount found in the box. In case the pujaris do not agree to some period the box may be opened once every month. It is further said that, the expenses of dhoop, deep and neivedya should he met from this money and such expenses should b" found out from the pujaris' account. If the pujaris do not disclose their accounts it W01lld be for the Raja to settle the amount which is to be spent on dhoop, deep and neivedya and then require the pujaris to spend that much amount for the purpose. This amount should be paid to the pujaris on their showing what they had spent on dhoop, deep and neivedya; but if the pujaris fail to spend anything, the trustee snould see that the expenses are properly incurred and debited to the pujaris in their khata and the balance of this khat, a should be divided among the pujaris.

The respondents are afraid that these directions would mean that the management will take away the money found in the box wh1>never it is opened and the pujaris would thus be at the mercy of the management for meeting the expenses of dhoop, deep and neivedya am! also for the balance to which they are entitled for their upkeep.

Up to now this amnunt of offerings up to Rs. 5/- was going direct to the pujaris and they were incurring expenses on dhoop, deep and neivedya out of it. The appellant contends that under the Madhya Pradesh Public Trusts Act, No. XXX of 1951, he has to maintain proper accounts under s. 15, to prepare a budget under s. 18 and to have the accounts audited under s. 16. Therefore it is necessary that he should show the amount received in offerings up to Rs. 5/- in his budget and should also show how much of it goes to the pujaris for their personal use and how urnch of

Raje Anandrao

v, Shanirao

Wanchoo ].

Raj"e Anandrao

Shomrao

Wanchoo ].

946 SUPR J<:)lE COURT REPORTS (1961]

it is spent on dlwop, deep and nefredya. There is no doubt that in order that puja in the temple in the shape of dhoop, deep and neivedya is performed properly, it is necessary to have cherk in this income from offeringd up to Rs. 5/. from which this expenditure is incurred, leaving the balance for the personal use of the pujari~. Even so it seems to us necessary that the interests of the pujaris arc also safeguarded and thev should not be left entirely at the mercy of the appellant, who may take away' the entire m(ney found in the box and may not pay them for long periods to what they are entitled as the balance.

Though . therefore the District Judge was right in making the arrangement for putting the offerings up to Rs. 5/- in a separate box so that they may be accounted for, we think some more provisions are necessary in order that cl. (c) may not affect adversely the private rights of the pujaris to the balance of these offerings after incurring the expenses on dhoop, deep and neivedya. It is also essential that some safeguard should be provided for the pujaris so that the amount put in the box is not surreptit.iously taken away. Though therefore t.he main provision in cl. (c) dealing as it does with the administration of the trust is not objectionable, it is necessary that it should be made self-contained and should a!So contain safeirnards for the pujaris. We therefore direct the District Judge to amend cl. (c) of paragraph 12 in order to bring into it the provisions contained in his detailed order. We also direct that the District Judge should provide for the protection of the interests of the pujaris by including the following in cl. (c) :-

(1) The box in which these offerings up to Rs. 5/- are put should be double locked-one lock to be put by the appellant and the other on behalf of the pujaris.

(2) It should be opened in the presence of a representative of the management and a representative of the pujaris who ;; hall be chosen by the pujaris in such manner aH they think fit and two respectablf'

persons of th<' town.

(3) The box may be opned once in a month or oftener as desired by the pujaris but not more than once in a week.

(4) The amount found in the box may be noted by the management; the whole of it should be handed over to the chosen representative of the pujaris on behalf of all the pujaris in case the ex. penditure for dhoop, deep and neivedya for the period prior to the opening has been met by the pujaris.

In case however sucli expenditure has been met by the management, the balance after deducting such expenses, shall be immediately paid to the chosen representative of the pujaris on behalf of them all.

The last provision has been made to make it clear that the management will not t:tke away the money but immediately give it to the representative of the pujaris for distribution among them. The provisions of the Public Trusts Act will be satisfied. in that the management will be in a position to know how much has gone to the pujaris including the amount spent on dhoop, deep and neivedya.

This provision will also take away any objection about there being interference with the private rights of the pujaris under the agree. ment of 1872.

We therefore allow the appeal, set aside the order of the High Court and restore the revised scheme subject to the modifications suggested by us above.

The Districi Judge will see that these modifications are embodied in the revised scheme.

In the circumstances of the case we order parties to bear their own costs.

Appeal allowed.

JIBON CHANDRA SARMA DOLOI

AN ANDI RAM KALITA AND OTHERS. (P. B. GAJENDRAGADKAR and K. N. WANCHOO, JJ.)

Brahmollar land-If alienable-Burden of proof-Assam Land and Revenue Regulation, I886 (Reg. I of z886), ss. 3(g), B(r)(a), 9.

The plaintiff-appellant filed a suit alleging that the lands in •uit were unauthorisedly transferred to the \)redecessors in mle

l?t

I96I

Raje Anandrao v.

Shamrao

wa.nchoo J.

February a3.

RAJE ANANDRAO

OTHERS. (P. B. GAJENDRAGADKAR

s. 92

C.P.C

Code of Civil Procedure, 1908

s. 92

s. 92

the Code of Civil Procedure

s. 92

the Code of Civil Procedure

s. 92

s. 92

the Code of Civil Procedure

L.R. 34 I.A. 78

s. 92

V. Viswanatha Sastri

Shankar Anand

Ganpat Rai

W. S. Barlingay

A. G. Ratnaparkhi

WANCHOO

Wanchoo

Nagpur High Court

Raje Mansingh Rao

Raja

Raje Anandrao

April 29, 1916

February 16, 1918

November 25,

1926

October 16, 1935

April 30, 1936

Shree Balasaheb Sansthan

Raje AnandYao

Raje Anandrao

November 30, 1953

April 12, 1954

s. 92

the Code of Civil Procedure

s. 92

s. 92

s. 92

s. 92

the Code of Civil Procedure

s. 92

s. 92

Civil Procedure Code

s. 92

s. 92

Raje AnandY•O

s. 92

the Code of Civil Procedure

s. 92

the Code of Civil Procedure

Bombay High Court

Allahabad High Court

Calcutta High Court

Patna High Court

s. 151

the Code of Civil Procedure

cl. 20

High Court of Judicature at Bombay

the Code of Civil Procedure

Section 92

Raje Anandrao

Raje Antoidrao

s. 92

s. 92(1)

s. 92

s. 92

s. 92

s. 92

s. 92(1)

s. 92

s. 92

s. 92(1)

Veeraraghavachariar

Madras High Con.rt

s. 92

s. 92

s. 92

Madras High Court

s. 92

s. 92

lVamhoo

Raje Auandrao

Shantrao

IVanchoo

District Judge, West Berar

s. 15

s. 18

s. 16

JIBON CHANDRA SARMA DOLOI

ANDI RAM KALITA

P. B. GAJENDRAGADKAR

K. N. WANCHOO

ss. 3(g)