~H..,,...., S"retttrJ, S.U. /"""' Jli/1...-,'

il•10ri4Ji011 ... 'l'A1 S":r•""' ~'"" Dislri&t 7 ,.,; i, IF"'"'' um.

lllfl

Fdnoar; J I,

948 SUPREME COURT REPORTS (1962) SUPP. '

that the normal lifo of the printing machinery is

20 years, a divisor will have to be adopted and by the adoption of the proper divisor it would follow that there is no available surplus for the relavant year. That is why the award passed by tho Tribunal directing the appellant to distribute Ra. 1.25 lakhs byway of bonus amongst its employees for the year I !156-57 has to be set aside. The appeal is accordingly allowed; but there would be no order as

to costs.

BIPAT GOPE

STATE 0.1!' BIHAR

(.M. Hm..i.YA.TULLAH and J.C. S.ILUI, JJ.) Criminal Prowlure-CommiUmml proettding-Ortlu of di4cltatr; e l>y M agi4trate, First Ola&, after trying tlae wlwk caae -Procedure under s. 207A(6), Criminal Procedure Code Jol/Dwt4-l/ in ezcuo of jurisdktio-Code of CrimiMl P..-.

dure, 1898 (Act V of 1898), s, 207..4(6).

In procccdinl!.' under s. 207A(6) of the Code of Criminal Proccdwe the Magistrate discharged the accused after recording the evidenc~ in the case. The High Court on rev.illon set aside the order and directed the Magfatrate to commit the accused to stand trial before the court of scssbn. The Magiatrate examined witnesses, held spot inspection.

He did not stop to find out if there was evidence which, if believed, would establish, at least, a prima facie case, but went on further to disbelieve that evidence, by an elaborate and paimtaldng process of examination, in aid of which he brought to bear his own appraisal of inconsistencies, improbabilities etc. In •hort, he tried the whole case from one and to the other and established his point in a fairly elaborate order.

Held, that the jumdiction conferred by sub-s. (6) of s. 207 A, does not entitle the Magistrate to try the case on his own, and forestall the drcision of the court of session.

The order of discharge passed by him in the present case, therefore, wu in cxccas of jurladic:tion, and muat he set aside.

CRIMINAL APPELLATE JumsmcTION: Criminal Appeal No. 153 of 1960.

Appeal by special le!lve from the judgment and order dated July 28, 1960, of the Patna High Court in Criminal Revision No. 1243 of 1959.

Sarjoo Prasad, B.K. Banerje, e, P.K. Ohatterje, e, and A.K. Nag, for the appellants.

S.P. Varma, for the respondent.

1962. February 1.-The Judgment of the Court was delivered by

II/di

B; plll 00[>1

S:ate of Bilrar

H!DAYATULLAH, J.-This is an appeal by Hidqyaluifoh J, special leave against an order of the High Court of Patna, by which an order passed by the Magistrate, First Class, discharging the appellants under s. 207A(6) of the Code of Criminal Procedure, was set aside, and the Magistrate was directed to commit the appellants to the Court of Session to stand their trial under ss. 307 /34 and 148 of the Indian Penal Code. The only question that is argued is whether the High Court was justified in setting aside the order of the Magistrate, which, it is cla.imed was passed in the proper exercise of the jurisdiction conferred by s. 207A(6) of the Code.

The facts of the case, in rief, are as follows: 011 March 26, 1959, at about 10-15 p.m. one Rajbahadur Rai alias Chhote Rai, was alleged to have been assaulted by the appellants at a place where Chhote Rai WllB sitting, at the pan shop of one Raghunath Prasad. The appellants are said to have arrived there in a private car and a tandem, and after assaulting Chhote Rai, to have gone away in these two vehicles. After investigation, the ppellants were prosecuted under ss. 307 i

34 and 148 of the Indian Penal Code, with the result already mentioned.

Before the order of discharge was made, the Magistrate heard the evidence of nine witnesses

!NI

/Jij>ol llep1

•• Stw•JBV..

HiioyobJ/o~ J,

SUPREME OOURT REPORTS [1962) SUPP.

including Chhote Rai and Ragbunath, who had given the first information report. Tho witn!'sses

also includtod two other alleged eye-witne>:oes, Bhushan ::iingh (P.W. 2), aud ::-heonandim Yadcv

(P.W. 6).

The Magistrate, aft.tr nicording the evidence and holding a spot inspection and hearing the parties, discharged the appellants, as he "a;; of opinion (in his own words)- "in view of the aforesaid di8ere pant, unreliable and incredible and highly int<rested prosecution evidence, no Court can consider it worthwhile prirna f acie even for a t1 ial.

In a case af this nature. it is the l<"gal obligatiun of a Magistrate to discharge the a<cus<d persons, as disc118sed above." The Magistrate reached this conclusion on a fairly Jong appraisal of the evidence in the caso, cliscussing it front tho angle of credibility of witnrsses, their antecedents, the probabilities of the !''lse,

the nature of the allegt•d weapon, the medical evidence and ; o on.

In short, it will not be wrong to say that h<: tried the case, instead of finding out whether there was no ground for sending up

the appellants to stand their trial before th<' Court of Session. The High Court, in the or<lf'r under appeal, held that the Magistrate went heyon<l thu

powers conferred u, pon him of enquiring into th11 case with a. view to committing it to the court of Se88ion.

ScC'tion 207 A is a new ection, which has been introduced by the Code of Crimin1l Proccdur1~ (Amenrlmcnt) Act, IU55 (:!6 of 195;)). It lays down the procedure which the Magistrates must follow in a.n enquiry in proceedings started on a

pulice report, preparatory to commitment of "aSPs to the Court of :-iession.

Suh-scdin1rn (l ). (:!)and

(3) deal with th1> fixing of dat""· iH•uing of procc&.•cs and ensuring that copies of the <l<H:ument• referrer! to in s. J7:l of the Code of Criminal

. ,

Procedure have been furnished to the accused.

Sub-section (4) then enjoins upon the Magistrate that he shall proceed to take the evidence of such persons, if any, as may be produced by the prosecution as witnesses to the actual commission

of the alleged offence, and also enables him to take the evidence of any one or more of the other witnesses for the prosecution as he considers, in his opinion, necessary. The sub-section divides the witnesses into two categories, viz... witnesses to the actual commission of tho offence and other witnesses like formal witnesses, or those who cannot depose to the actual commission of the offence. Of the first category, those that the prosecution produces, must be examined; but the other witnesses may be examined, only if the Magistrate considers it necessary. It seems, prima facie, that the prosecution cannot insist on their examination. An accused is given by subs. (5} a right to cross-examine the witnesses, who a.re examined, and the prosecution can also reexamine them. Then comes subs.(6), which reads as follows :-

"When the evidence referred to in subsection \4) has been taken and tbe Magistrate has considered all the documents referred to in section l 73and has, if necessary, examined the accused for the purpose of enabling him to explain any circumstances appearing in the evidence against him and given the prosecution and tho accused an opportunity of being heard, such Magistrate shall, if he is of opinion that such evidence and documents disclose no grounds for committing the accused person for trial, record his reasons and discharge him, unless it app0ars to the

Magistra~ that such person houlrl bn tried before himself or some other Magi>trate, in which case he shall proceed accordingly."

This subsection, it is contended, gives the

Bipat Gop.

Stal• of Bihor

Hida;>alullah J.

IHI

Bf1<1 G ...

•• 81•1,.JBiA•

H~WJ.

952 SUPREME COURT REPORTS [1962) SUPP.

Magistrate the option not to oommit an accused but to disohargo him, if he is of opinion. for reasons to be recorded, that the evidence discloses no grounds for committing the accused peNon, unless it appears to him that the person should be tried before himself or some other Magistrate. The Magistrate, in this case, thought that the power conferred upon him by this sub-section enabled him to examine the evidence throughly, and if it did not satisfy him, to discharge the accused. This view of the Magistrate was not accepted by the High Court.

Mr. Sarjoo. Pra88d for the appell, nts, contends, on the basis of the ruling of this Court in Ramgopal Ganpatrai Ruia v. TM State of Bombay (' ), that the course followed by the Magistrate in determining whether there was credible evidence or not was the right course, and point!! to certain passages in the jud2ment in the above case as supporting his proposition. The cited case interpreted s. 209 of tho Code of Criminal Procedure, which, after amendment of the Code by Act 26 of 1955, deals with proceedings instituted otherwise than on a police report, and under whirh the

Magitrate can discharge Bii accused if he finds that there aro "not sufficient grounds" for committing the accused person for trial. The words of the two SPctions are not the samll, and it is possible to sa. y that the force of the two sections is also not the same, and that s. 209 gives a power to enter upon the merit~ of a case in 11 manner which s. 207 A doer not warrant. Whether the hanp; e of the language iR deliberate or due to the fact that different draftsm1•n drafted tho two sortions, the test for diecharging the accused must, in a large way, be the

same under both tho sections, and it is hardly necessary to decide the full of ambit of s. ~07 A.

and contrast it with that of H. 20!l. If there is any indic ition in the la11gua11e, it is altogether on the side that. the Magistrate must find a stronger case for discharging an accuso<l under s. 207 A than under

(I) [1958] S.C.R. 618.

. '

2 s.c.R.

SUPREME OOURT REPORTS 953

s. 209.

But, whatever the meaning of the two expresRions, neither of them invests the Magistrate with the jurisdiction to decide the case, as if the sessions trial was before him. To this extent, Mr.

Sarjoo Prasad fairly concedes, s. 207 A ( 6) cannot b'.l carried. Put in other words, the section can only mean that if there is a prima facie case triable by the Court of Session, the Magistrate must commit the 3ccused to the Court of Session to stand his trial. What those cases would be, which would satisfy the test, may not generally be stated here, because, in our opinion, this case is far from the borderline, where only difficulties are likely to be met.

In this case, we are clear, on a reading of the reasons recorded by the Magistrate, that he did not stop to find out that there was evidence which, if believed, would establish, at least, a prima facie case but went on further to disbelieve that evidence by an elaborate and painstaking process of examination, in aid of which he brought to bear his own appraisal of inconsistencies, improbabilities etc. In short, he tried the whole case from one end to the other and established his point, as has been said already, in a fairly elaborate order. In this process, he disbelieved the injured person, other eye-witnesses, contrasted the oral testimony of how the offence took place with the medical evidence and his own conclusions drawn from an inspection of the site and other matters, to numerous to detail here.

In our opinion, whatever the jurisdiction conferred by sub-s.(6) of s. 207A, it does not entitle a Migistrate to try the case ou his own, and forestall the decision of the Court of Session, and this is what the Magistrate, in fact, did here. We, therefore, agieo that the order of discharge passed by him was in excess of his jurisdiction, and it ls

Bipat Go;.

Slate of Bihar

Hida]Qlul la/I J.

'"' ~I GoPf v. /IUUe/BiMr

Hi""'""'1JeA J.

1'11>1 .. 1 '

95t SUPREHE COURT REPORTS [1962] SUPP. l l

h11.rdly necessa.ry in this case to show how far a Mal!?istrate ca.n go to find that there is no ground for committing the accused to stand bis trial in a Court of Seesion. We seo no reason to interfere with the order of the High Court, 11.nd diemiAs the 11.ppeal.

It is a matter of regret that much delay ha.s taken place in this ca.se, and it may harm the case on the one side or the other. We hope that now thll case will be he11.rd from day to day, 11.nd disposed of, 11.6 expeditiously 11.S possible. We further make it clear to the Court or Courts de11.ling with this case that any expression of opinion on the merits of th" case whether b:v us or by the High Court or the Magistrate, who first heard it, or elRe where, in this ordPr or the ordrrs prece ding this, is to be completely ignored. and the case shall be decided without being influPncecl in any way by Ruch expression of opinion.

Appeal dismissed.

RAMALINGAM & CO.

THE Sl'ATE OF MADRAS (S. K. DAS, M. HrnAYATULLAH and J. C. SHAH.

JJ.)

Salu Taz-Contratt for sale of goud1 by corresponden"- C. I. F. or G. F. controcf.1-Bill of /fJding hand.d otier to banus tD port with only on paym.nt-Whtfh-r properly in good8 pa&Jed ;,. Mttdraa-Pooition of banker1 Vi•-a-Via wler and foreign buy.,,_J,.i.,,,., diary bank<r if agent o/ ulkr-Madra1

Gtneral Salt1 Ta:r: Act (Marl. 9 of 1931!).

The .._....,. were doing busine" principally as expor ters of vcg<table fibres 10 fon:ign countri<s. The contracts of sale wen: C.I.F. or C.F. and wen: made by correspondence on approval of samples sen! by the a.scssr<S to the foign buy<rs. The price was payable by draft upon bank credit to be opened by the buyer ; who opened with bis own bankers

• I

BIPAT GOPE

s. 207A(6)

Criminal Procedure Code

s. 207A(6)

s. 207

s. 207A(6)

Code of Criminal Procedure

ss. 307

Indian Penal Code

s. 207A(6)

ss. 307

Indian Penal Code

s. 209

Code of Criminal Procedure

s. 209

s. 207

s. 207

s. 209

s. 207

s. 207A


'"' ~I GoPf v. /IUUe/BiMr

Hi""'""'1JeA J.

1'11>1 .. 1 '

95t SUPREHE COURT REPORTS [1962] SUPP. l l

h11.rdly necessa.ry in this case to show how far a Mal!?istrate ca.n go to find that there is no ground for committing the accused to stand bis trial in a Court of Seesion. We seo no reason to interfere with the order of the High Court, 11.nd diemiAs the 11.ppeal.

It is a matter of regret that much delay ha.s taken place in this ca.se, and it may harm the case on the one side or the other. We hope that now thll case will be he11.rd from day to day, 11.nd disposed of, 11.6 expeditiously 11.S possible. We further make it clear to the Court or Courts de11.ling with this case that any expression of opinion on the merits of th" case whether b:v us or by the High Court or the Magistrate, who first heard it, or elRe where, in this ordPr or the ordrrs prece ding this, is to be completely ignored. and the case shall be decided without being influPncecl in any way by Ruch expression of opinion.

Appeal dismissed.

RAMALINGAM & CO.

THE Sl'ATE OF MADRAS (S. K. DAS, M. HrnAYATULLAH and J. C. SHAH.

JJ.)

Salu Taz-Contratt for sale of goud1 by corresponden"- C. I. F. or G. F. controcf.1-Bill of /fJding hand.d otier to banus tD port with only on paym.nt-Whtfh-r properly in good8 pa&Jed ;,. Mttdraa-Pooition of banker1 Vi•-a-Via wler and foreign buy.,,_J,.i.,,,., diary bank<r if agent o/ ulkr-Madra1

Gtneral Salt1 Ta:r: Act (Marl. 9 of 1931!).

The .._....,. were doing busine" principally as expor ters of vcg<table fibres 10 fon:ign countri<s. The contracts of sale wen: C.I.F. or C.F. and wen: made by correspondence on approval of samples sen! by the a.scssr<S to the foign buy<rs. The price was payable by draft upon bank credit to be opened by the buyer ; who opened with bis own bankers

• I

' -

...

an irrevocable letter of credit in favour of the assessees for 95% of the net invoice value. Intimation of the opening of the letter of credit was then given to the assessees by the local bankers in India who were the agents of the foreign bankers. The local bankers, however, did not by intimating the opening of the letter of credit undertake any liability, and the assessees were expressly informed that they would not be released from their liability U:1der the Bill of Exchange drawn by them. On receipt of the information about opening of the letter of credit the assessees shipped the goods, obtained bills of lading in their own names and lodged the shipping documents endorsed in blank with their own bankers together with the invoice and Bill of Exhange for 95% of the invoice value.

Bills of lading were handed over to the assessees bankers with the definite instructions to pass on the shipping documents to the buyers only on payment. The assessees then discounted the Bills through their own bankers. The shipping documents were forwarded to the foreign bankers who on presentation paid 95% of the invoice amount. The Bill of lading was then delivered by the foreign banker to the buyer and goods were unloaded.

For the year 1945-46 the Commercial Tax Officer taxed the assessees under the Madra. General Sales Tax Act, 1930.

The Commercial Tax Officer rejected the claim of the assessees lhat the amounts in respect of overseas transactions was exempt from liability to tax, because in his view the export transactions were sales within the province of Madras. The Board of Revenue confirmed the order and held that the property In th_e goods passed to the buyers in a large majority of the export transaction when the goods were shipped.

The assessees contended that the export sales were at the material time totally outside the provisions of the Madras General .Sales Tax Act and the order of the assessment was ultra vires and beyond the powers of the Authority. The plea of the State of Madras was that the foreign bank opening the letter of . cred_it is an agent of the buyer, and that the bank authorises lls own branch to pay the price to the shippers and by the arrangements made by opening the letter of credit, price is paid to the vendor in his own country against the Bill of lading endorsed in blank.

Held, that the price in respect of the goods was not received in the Province of Madras and the property in the g"oods also did not pass to the buyer within the province.

Therefore tax in respect of the sale transactions was: not exigible under the Madras General Sales Tax Act 1939.

The expansion of in temational trade involving overseas transactions has raised problems of peculiar difficulty. The

Rmralingr.m th Co.

Tiu Slate of Ma<ltas

IHI B•Wlrtr••c.. v.

TAI 111.,, •f JI.air.,

SUPREME COURT REPORTS [1962) SUPP.

partiea to a contract (which is as a resu1t of .:orrtspoodence) are generally unknown IO each other; often neither the seller nor the buyer is pref."lred to trust the other and the seller is reluctant to tic up h11 funds and the buyer is al<0 unwilling to make payment in advance. To tide over the problem created by this reluctance of the seller and rhc buyer, b•nken of international repute and credit Interpose. They for small commission undertake by operuog letters or credit to honour the bill of exchange drawn by the seller accompanied by the insurance policy and the invoice relating to goods forming the subject matter of the contract. At the in!lance of the buyers the bank ismes a letter of credit which ;, addressed to the world at large or more frequeotly to specified person or persons thereby the bank undertakes to honour the Bills of Exchange drawn on the faith of that letter.

Invariably the bills arc pyable in future but the exporters a• the benefi. ciaries un:ler the contract, have the g iarantee of th' banker that payment will he forthcming an1 are also entitled to discount the Bills with any party cognisant of the undcrtak

ing of the original banker.

The relation between the b, ycr and his issuing b, nker was not of principal and agent, nor was the relation between the i5'uing banker and the intermediary banker that of principal and agent. The tw.> b•nkcr; were interposed for the pr., trction of the seller a• well a• the buyer. The issuing b inker did not purport to act a• agent of the buyer and the intermediary bankcn accepted the general offer of the issuing banker negotiatin~ te draft.

By so accepting the offer and bv taking over the Bill of Laing, the insurance certificate and the invoice which represented title to the goods the intermodiary bJnkcr did not act as an agent or the seller.

C1vrr. APPELLATE JURISDICTION: C.A. No. 10 of 1961.

Appeal from the julment a.nd decree dated March 5, 1956 of the Madras High Court in A.S. No. 256 of 1951, R. Ramamurlhi Aiyar and R. Gopalakrishnan, for the appellants.

R. Ganapalhy Iyer and D. Gupln, for the Reepondent.

1962. February l. The Judgment of the Coitrt was delivered by

' I

SHAH, J.-Messrs. Ramalingam & Co.-hereinafter called the assessees-are a firm doing business principally as exporters of vegetable fibres to foreign countries. They have their place of business at Tuticorin in the district of Tirunelveli in the

State of Madras.

The contracts of sale are made by correspon dence on approval of samples sent by the assessees to the foreign buyers. The contracts are C.I.F. or C.F. and the price is payable by draft upon bank credit to be opened by the buyer. The course of dealing between the assesseee and the foreign buyers was as follows :- After the contract for a quantity of goods was finalised by correspondence and the price ascertained the foreign buyer opened with his own bankers an irrevokitble Letter of Credit in favour of the assessees for 95% of the net invoice value.

Intimation of the opening of the Letter of Credit was then given to the assessees through a bank operating in the Province of Madras. The asses11ees then shipped the goods, obtained Bills of Lading in their own names and lodged the shipping documents endorsed in blank with their own bankers together with the invoice and Bill of Exchange for 95% of the invoice value.

The assessees then discounted the Bills through their own bankers. The shipping documents were forwarded to t.he foreign banker who on presentation paid 95% of the invoice amount. The Bill of Lading was then delivered by the foreign banker to the buyer and the goods were unloaded.

For the year 1945-46 the Commeroal Tax Officer, Tirunelveli determined for the purpose of computing tax liability under the Madras General Sales Tax Act, 1939, the turnover of the assesseee at Rs. 15,61,200/-.

The Commercial Tax Officer rejected the claim of the ..esessees that the amount of Rs. 15,22,000/· in reepeot of overseas transactions

Ramalingam dr Co. v.

Tb• Slal1 •f Jl.wu

SIW> J.

-.1..,..cl:Co.

TAI Btou of Modraa

SW J.

SUPREME OOURT REPORTS [1962) SUPP.

was exempt from liability to tax.

He held that the export transactions in respect of which the

ex cm ption was claimed wer<' sales within the province of Madras and suhjPct to sales.tax under the Madras General Sales Tax Act, 1939. Tho order t>f tho Salea-tax Officer was confirmed by tho Board of cvenne, Madras, except as to the amount of freight.

The Board of Revenue held that the propcrty in the goods passed to the buyers in a large majority of the expo1t transactions when the goods were shipped. On remand, the Commeroial Tax Officer recomputed the turnover at Rs. ll ,23,603/8/8 inclusive of the local sales of the value of Rs. 75,082/14/0. After paying the tax tho aBSessees sued the Province of Madras in the Court of the Subordinate Judge, Tuticorin for a decree for Rs. 10,485/· being the amount oi tax paid by them on export sales pursuant to the order of &88essment and interest thereon at 6% until realisation.

The assesseee contl.'mled that the export salPs were at the matt'lial time "totally outside the provisions of the Madras Genna) Sales Tax Act, and the order of assessment was ultra ifres and beyond the powers of the authorities". Tbfl !-'ubordinate Judge decreed the claim for Rs. 10,323/· with interest at 6% till realizaticn. Jn appeal, the High Court of Madras reversed the decree and dismissed the suit filed by the aSBeBBees.

With certificate granted by the High Court this appeal is preferred by the a88ell8ees.

It is oommon ground that in the yeoar 1945-46, under the Madras GenPral Sales Tax Aot; 1939, the taxing authorities had no power to levy sales-tax on sales which took place outside the Province. The decision of the appeal, therefore, depends upon the determination of the question whether the export sales took place within the Province. If they took place within the Province, the sales wert' properly taxed.

We may observe that the plea that a suit for a decree for refund of tax paid in pursuance of

. '

-,.

2 S..C.R.

SUPRElME COURT REPORTS 959

an order of assessment passed by the taxing authorities on the basis that the sales took place within the Province did not lie in the civil court, was not raised in the Court of First Instance, nor in the High

Court. Counsel for the State of Madras has also stated before us that he does not desire to contend in this case that the suit was, in view of the adjudication by the taxing authorities, not maintainable.

We therefore proceed to deal with the only question which was debated before us at the Bar : whether the export sales which ar.e the subject matter of

dispu~ in this appal were completed within the

Provmce of Madras.

The dispute relates to turnover in respect of seventeen export transactions with merchants in different destinations overseas. As typical of the transactions the files relating to the shipments to Messrs Begbie Philips and Ha.yla.y, London and Messrs Hindley and Company, London were tendered in evidence and the case proceeded to trial on the footing that those transactions were typical of all other transactions.

On April 16, 1945, the Mercantile Bank of India wrote a letter in connection with the shipment to Messrs Begbie Philips and Hayley, London a.bout a contract of sale of five tons pa.lmyra fibre. The letter is in the following terms :-

"Dear Sirs,

Without any responsibility on the part of this bank we beg to advice receipt of a telegram from our London office reading :- "We open irrevocable credit favour Ra.malingam Company, Tutioorin, £400 (four hundred pounds) drafts on Mercantile Bank of India Limited, 60 d/st. invoices, full set shipped bills of lading order bank endorsed certificate of origin insurance oovered in London about 5 tons palmyra fibre at £80 (eighty pounds) not per ton C and F. Shipment soonest India to

lHB

B""'alU., ... .tCo.

" Tho s,.,, of M•• 1

Shi J.

R__,..,__.c •.

T• SI-. of Mo'1a•

8W .1.

. 960 SUPREME COURT REPORTS [1962) SUPP.

United Kingdom by approved ship.

Part shipments allowed expiry 6th October, 1945 a/c Bagbie Phillips Hayley, Limittd, IicC'ncc No. 198281."

When submitting documents under this credit we would emphasise the fact that the goods must be described beth in the bill of lading and invoice identically as advised above and the relative bill marked "Drawn under telegraphic credit No. 88-A/36 of 12th April 1945".

We shall furnish you with further parti culars on receipt of written confirmation.

Owing to frequent mutiliations in coded telegrams the above message is subject to any neooBBary corrections on receipt of eonfirma. tiou by mail.

Kindly note that the negotiation of bills under this credit is entirely optional on our part am! this advice does not release you from the liability attaching to the drawer of a Bill of Exchange.

This letter must be produced with all bills drawn unr!er this credit.

Yours faithfully

(signed) ..•

Manager".

On May 28, 19!5, the National Bank of India, Tuticorin wrote a letter to the asseBBeell in regard to a sale of a qua.utity of fibre, which is as follows:-

"Dear Sirs,

We beg to inform you that we are in reoeipt of advice by cable of 24th instant

-..

from our London office that they have received from Messrs Hindley and Company, Limited, No.35, Crutched Friars, London,.!<:. C. 3 an undertaking to honour your bills on Messrs. Hindley and Company, Limited No. 35 Crutched Friars, London E. C. to the c xtent of £370 (three hundred and seventy pounds) sterling being 95 per cent of invoice value on the following conditions :- Bill to be drawn payable 90 days after sight and to be accompanied by - Invoices.

Full sets of on board bills of lading made out to order and blank endorsed representing shipments of:- Five tons Tuticorin medium cut and dyed bassine 7 inches and 7-l/2 inches equally at £78 per ton in l Cwt. (ballots) C and F United Kingdom post Shipment June/July from Cochin freight paid of deducted and credit reduced accordingly - Freight basis 22nd May, 1945.

Insurance including was risk with unlimited transhipment covered in London.

Such shipping documents are to be dt-livered on payment of the bills which should bear the clause - "Drawn under N.S.I. credit number 83 cabled 24th May 1945".

Bills fulfilling the above-mentioned conditions must be negotiated on or before-Extended till 30th April 1946.

Please note that the bank accepts no liability for the above undertaking and this advice does not release you from the lir.bility attaching to the drawer of a Bill of Exchange.

The above message lli continued by us on behalf of the opening bank for your informa- ,.. tion but without any responsibility on our

l!J62

Bamalingam &: Co. v.

The Slat• of Madras

Shah J,

IHZ n...i;.8,,.. .t Co. v.

Tiu 814<• II/ Modru

SAala J.

962 SUPREME OOURT REPOR'l'S [1962] SUPP. ...-.:

part eiroept for the correctness ot this copy of the telegram as received by us.

When uegotiating bills please produce this letter to have the amounts reoordcd on the back hereof.

I am, Dear Sirs,

Yours faithfully (Signed) ..... .

Manager." On receipt of intimation the asseBBees shipped the goods and banded over the Bill of Lading and the invoice to their own bankers, accompanied by a Bill of exchange for the amount for which the Letter of Credit was opened by the fonign banker. The aHBCS

dCes then discounted the bills for the amount for which credit was opened.

The taxing authorities taxed these transactions, because, in their view, the sales were effected in tho Province of Madras and not outside.

The assessees in the plaint in paragraph IV cl. (e) stated that one of the salient features of the business was that "The bills of lading are handed over to the Plaintiffs bankers with the clear and definite instructions to pass on the shipping documents to the bu~ era only on pay. ment.

They are what is styled in commercial paralance as D/P bills, i.e., documents to be handed over on payment".

This averment in the plaint was not traversed in their written statement by the defendants. The only witness examimcl at the trial was A.V. Samuel, one of tho partners of the a.Raes sees' firm.

He deposed to the practice which was follow1d by the assessees. He stated .-

"After shipment we obtain Bill of Jadiug made out in our name as shipper. We draw a bill of Exchange and along with bill of ladil1g and invoice. These documents are deposited with

National Bank. We endorHe in Rank on th" Dill of Lading. It is only after paymeut ol

the Bill of exchange by the foreign Bank on behalf of tho purchaser, the Bill of Lading is handed over. Till the bill is paid for no title in the goods pass and the goods are at our disposal. If the bill is not honoured the Bank will ask us for directions as regards the disposal of goods. Under instruction from the buyers foreign banks give instruction to any local Bank to give credit up to a certain limit. Inspite of letter of credit as drawers we are responsible under the bill of exchange. We can discount in any bank and not merely in the credit opening bank." In cross-examination he stated that the "credit opening b'1nk opens credit on behalf of the purchasers.

Those banks are not known to us before,"

It is clear from the terms of the two letters dated April 16, 1945, and May 2S, 1945, that the foreign buyers had opened letters of credit for the benefit of the assessees, for the amounts set out therein. These, it appears, were general credits and

intimation thereof was given by the local bankers in India who were agents of the foreign bankers. The local bankers, however, did not undertake any liability by intimatmg the opening of the letter of credit and the assessees were expressly informed that they (the assessees) would not be released from their liability under the Bills of Exchange drawn by them. The assessees negotiated the Bills through their bankers after receiving an intimation of the opening of credit.

Counsel for the State of Madras submits that the property in the goods which were the subject matter of sale passed in Tuticorin when the assesees received an amount which represented the price

f the goods against delivery of the Bills of Lading ndorsed in blank with authority to complete the ndorsement. In substance, the plea is that the oreign bank opening the letter of credit is an agent

R1molio1..,•do,

Tlw St& oJ Mdr11

SWJ,

964 SUPREME COURT REPORTS (1962) SUPP. ~

1961 of the buyer, and that bank authorizea its own a._i0w,...,, c.. branch to pay the price to the ahippers and by the n. 51 vef Mw arrangementa made by opening the letter of credit, "' price is paid to the vendor in his own country against SAaloJ. the bill of Lading endoraed in blank.

It ia necessary to appreciate the true nature of the commercial letter of credit extensively used in fo, eign trade.

During the last fow decades, expanaion of international trade involving overseaa tranaaotiona has raiaed problema of peculiar difficulty.

The partiea to a contract to supply gooda are generally unknown to each other and the contract ia the result of correapondence between the parties. Often neither the seller nor the buyer is prepared to trust the other.

Again, between the delivery of the goods in such trade on board the ship and its ultimate delivery at the destination, the seller ia reluctant to tie up his funds.

The seller himself is generally a purchaaer of gooda from the local market and ha.8 in vested funda in purchaaing the goods. The buyer is also unwilling to make payment in advance. To tide over the problem created by thia reluctance of the seller and the buyer, bankers of international repute and credit interpose.

They for a small commieaion undertak11 b; v opinion letters of credit to honour the Bill of Exchange drawn b; v the seller accompanied by the insuranc11 policy and the invoice relating to the goods forming the subject matter of the contract. At the instance of the buyer the banker issues a letter of credit which ia addreaaed

to the world at largo or more frequently to specified person or persons : thereby the banker undertakes to honour the Bills of Exchange drawn on the faith of that let.ter. Invariably, the Bille are payable in future but the exporters as tho benefioiariea under the contract, have the guarantee of the banker that payment will be forthcoming and are alao entitled to discount the bills with any party oogniaant of the undertaking of the original

...

banker. There are generally four parties to such a transaction -the buyer, the seller, the banker who issues the letter of credit, called the issuing banker and the intermediary or the negotiating banker who allows credit to the seller on the bills lodged with him. Between the buyer and the issuing banker, the contract is that he will pay bills drawn by the seller of the goods against delivery of the Bill of Lading, insurance certificate and invoice. The buyer undertakes to put the banker in funds to enable him to make payment if the documents are presented. The relation between the buJer and the banker is not of pricipal and agent. The contract between the issuing banker and the negotiating bankllr may be of a durJ character. Where the issuing banker's instructions are merely to advise the credit, and the credit calls for bills to be drawn either on the issuing banker or on the buyer, the intermediary banker may negotiate the beneficiary's bills. In such a case he stands qua the issuing banker as principal to principal, for either he succeeds to the rights of the beneficiary under the credit or, if he negotiates relying on the credit alone, as acceptor of the offer it contains. If the instructions call upon the intermediary banker to p1ty or to negotiate the beneficiary's bills, the intermediary banker is tho issuing banker's agent.

Under the I erms of the contract between the assessees and the foreign buyer the price was to be paid "by draft after 90 days under bank credit to be opened by the buyer for 95% of the net invofoe amount." By the letter of credit the foreign banker guaranteed to pay the amount in London.

The issuing hank intimated the opening of the letter of credit., but there is no evidence of any expri; ss directions to its agent in India to pay or negotiate the draft. The letter of credit was gomiral; and it was open to any bank on the faith

R11m11.biripam & Co.

The 61ai. of Madras

Slfah J,

IHI ... ,, ..... °'

"· 'f'/w SW. ~JI od< ..

aw .1.

SUPRBMB OOURT REPOR~ [1982] SUPP.

thereof to negotiate the bill issued by the asseesees.

The payment m&de by the intermediary bank was not and could not therefore be on behalf of the issu

ing bank much leee on behalf of the buyer. By negotiating the bill, the banker of the weeeeee became the acceptor of the offer contained in the letter of credit of the issuing bank, and as suoh aooeptor obtained the Bill of Lading, the invoice and the Bill of Exobange and presented them for payment.

This arrangement was not an arrangement for pay, ment of prioe on behalf of the buyer.

It appear• clear from the two letters dated April 4, 19'5, and May 28, 1945, that the banks accepted no liability by intimating the opening of the letter of credit and the liability attaching to the &SBell8etll by drawing Bills of Exchange was not discharged. If the liability of the &18e811008, as drawers of the Bills of Exchange continued, the arrangement made by the buyer could not be regarded as one to pay the prioe throngh his banker in India. As stated hereiDbefore, the relation between the buyer and his i.ssuin~ banker was not of principal and agent, nor was the relation between the issuing bankar and the inti>rmediary banker that of prinoipal and agent. Tho two bankers were interposed for the protection of the seller 1111 well as the buyer. The issuing banker did not purport to act as agent of the buyer and the intermediary banker acoepted the general offer of the issuing banker by negotiating the draft. By so accepting the offer and by taking over the Bill of Lading, the insurance certificate and the invoice which represented title to the goods the intermediary

banker did not &et as an agent of the 11eller.

The price in respect of the goods was not received in the Province of Madras, and the pro perty in the good& also did not p"88 to the buyer

within the Province. Tax in respect of the ea.le of 1962 fibre by the assessees under tne disputed transac- Ramalingam.,, Co. tions was therefore not exigible under the Madras v.

General Sales Tax Act.

Tiu Stat• of Madras

The appeal is therefore allowed : the decree of the High Court is set aside, and the decree of the trial Court is restored with costs in this Court and the High Court.

Appeal allowe.d.

M/S. BALLABHDAS AGARWAL

THE STATE OF BIHAR

(J.L. KAPUR, M. IIIDAYATULLAH and RAGHUBAR

DAYAL, JJ.)

Sales Tax-Appeal from order of Board of Revenue-No A 71peal from ordei of High Oourt.--Assesaet if can agitate the correctness of deci•ion of Board by Special Leave-Remedy open lo assessre wlien que .. tion asked for, not replied by the Board to Tligh Court-Appeal not maintainabk where breach of Rule of Natural. Justice or violation of principle of law not shown-Bihar Sales Tax Act, 1947 (Bihar 19 of 1947), ss. 6,24,25,28.

The appellant, a Railway contractor, having Refresh ment Rooms and Tea Stalls at various stations, was registered as a dealer under the Bihar Sales Tax Act, 1947. He being aggrieved bv the assessment for the year 1950-51 made by the Sales Tax Officer took the usual .appeals to the Sales Tax Authorities and after the appeals were rejected he took a revision under s. 24 of the Act before the Board of. Revenue Bihar which was dismissed. He then applied under s. 25 of the Act to refer six questions of law to the High Court.

The Board referred only one question to the High Court.

The High Court after reframing the question answered it in the negative against him.

Against the order of the Board of Revenue the appellant brought an appeal by special leave to the Supreme Court but he did not appeal against the judgment and order of the High Court.

Shah J.

J96B

F•b•UJJry 2.

RAMALINGAM & CO

THE Sl'ATE OF MADRAS (S. K. DAS

C. SHAH

General Sales Tax Act, 1930

Sales Tax Act

Madras General Sales Tax Act 1939

Madras General Sales Tax Act, 1939

Sales Tax Act

General Sales Tax Act

ss. 6

Bihar Sales Tax Act, 1947

s. 24

s. 25


28.C.R.

SUPREME COURT REPORTS 967

within the Province. Tax in respect of the ea.le of 1962 fibre by the assessees under tne disputed transac- Ramalingam.,, Co. tions was therefore not exigible under the Madras v.

General Sales Tax Act.

Tiu Stat• of Madras

The appeal is therefore allowed : the decree of the High Court is set aside, and the decree of the trial Court is restored with costs in this Court and the High Court.

Appeal allowe.d.

M/S. BALLABHDAS AGARWAL

THE STATE OF BIHAR

(J.L. KAPUR, M. IIIDAYATULLAH and RAGHUBAR

DAYAL, JJ.)

Sales Tax-Appeal from order of Board of Revenue-No A 71peal from ordei of High Oourt.--Assesaet if can agitate the correctness of deci•ion of Board by Special Leave-Remedy open lo assessre wlien que .. tion asked for, not replied by the Board to Tligh Court-Appeal not maintainabk where breach of Rule of Natural. Justice or violation of principle of law not shown-Bihar Sales Tax Act, 1947 (Bihar 19 of 1947), ss. 6,24,25,28.

The appellant, a Railway contractor, having Refresh ment Rooms and Tea Stalls at various stations, was registered as a dealer under the Bihar Sales Tax Act, 1947. He being aggrieved bv the assessment for the year 1950-51 made by the Sales Tax Officer took the usual .appeals to the Sales Tax Authorities and after the appeals were rejected he took a revision under s. 24 of the Act before the Board of. Revenue Bihar which was dismissed. He then applied under s. 25 of the Act to refer six questions of law to the High Court.

The Board referred only one question to the High Court.

The High Court after reframing the question answered it in the negative against him.

Against the order of the Board of Revenue the appellant brought an appeal by special leave to the Supreme Court but he did not appeal against the judgment and order of the High Court.

Shah J.

J96B

F•b•UJJry 2.

M /s. Ballablu:los

..1garuaJ

"· ' TM- Stal< nf Bihar

'"""' J.

Held, that an as.cssee is not entitled to agitate the correctness or otherwise of the decision given by the Tribunal in regard to the questions which were agitated before the

Hi, h Cn11rt and were decided against him and against which no appeal wcs brought to the Supreme Court.

Held, further, that if any question on which the 1Wessee wanted a reference to the High Court was not referred, it was open to the a'5esscc to apply to the High Court for a reference under s, 28 of the Bihar Sales Tax Act, 1947.

H•'d, also, that it has not been shown that there was any such breach of the rules of natural justice or violation of any principle of law which would be a good ground for our interferrnce direct with the orders of the Board of Revenue in an appti1l under Art. 136 of the Constitution,

Chimmonlal Ram,.hwarlal v, Commi.i&ioMr of lncomt Tar (Centralj, Calcutta AJ.R. 1960 S.C. 280 and Chandi PrtllJad Chokltaui v. Stak of Bi/tar, A, I.R. 1961 S, C. 1708, applied.

Crv1L APPELLATE JurusnrcTION: Civil Appt>al No. 3i!l of 1961.

Appeal by special le&ve from the Re11olution <lated April 21, 195~, of the Board of Revt-nut', Uihar Patna in Revision Case No. 706of1953.

S.K. Kapur and K.K. Jain, for the appellants.

D.P. Singh, R. K. Garg, M.K. Ramamurthi and S.C. AgaT'W<ll, for tho respondents.

1962. February, 2.-The Judgmtlnt of the Court was delivlred by

luPUR, J.-This appeal by Special Leave against the c.rder of tho Board of Revenue, Bihar, relates to the assessment for the year 1950,51 of SaleA

Tax of the appel111.nt under the Bihar Sales Tax Act, 194i (Act 19 of 1947), hereinafter called the 'Act'.

The appellant was a railway caterer, who had Refreshment Rooms and Tea Stalls at various Railway Stations. He sold various kinds of eatables, cigarettes, betels, milk, fruits and tea at railway etatio118.

He was registered as a. dealer under the Aot 11nd had been carrying on busineBB for a fairly long timti. His case was that as it was difficult for him tu maintain accounts in regard to ea.tablee,

2 S.C.R. HUPREME COUB, T B, EPORT6 969

some of which were taxable and others were not, he made representation in HH4 to the Bihar G1wernment for same arrangement so that the diffi- 011lty in keeping diadrent set; s of accourit would be obviated. As a result of his representation the Bihar Government by a letter June 5, 1945, itF; reed that the appellant's taxable turnover in Bihar would be taken to be 66 2/3 % of the gross turnover d1iring the quarter ending December 31, I 944, and that this perc11ntage might be revised after December 31, 1945. As a result of this letter, the appellant did not keep separate accounts for taxable and non-tnxahln itums and for some of the quarters s11bs<>qnent to f.h1lse mentioned in the letter above referrerl to were also taxed according to the arrangement contained in that letter. For the period April I, 1950, to llfareh 31, 1951, the gross turnover was Rs. 11,16,270-11-0 and the appellant claime<l tha, t h!l he asses; r:d at 66 2/3 % of that amount ; but th0 Bales Tax Officer tiLxed him on the total gro~8 tumovor except for the usual rebate of 4% allowed in such cases.

He submitted th~, t in this turnover there were induded tax-free articles such as fresh milk, meat, fidh, green vegetables etc., which were exempt from Sales tax under s. 6 of the Act. His submission was that the excess amount assessed was Rs. 11,416-15-0. Against this order he took the usual appeals to the Sales Tax Authorities and after the appeals were rejected, he took a revision under s. 24 of the Act before the Board of Revenue. Bihar, "here also he was unsuccessful.

Under s. 25 of the Act he applied for referring 6 questions of law to the High Court and those questions were as follows :- (i) Whether upon the true construction of the agreement of 1945 between the State Government and the assessee which ha<l beea acted upon and not reviewed, the Department waa legally entitled to tax petitioner on his gross

M/s. BaUabkdaa

Aga1wal ..

The State of B, har

Kqpur .1.

IHI

MI•· JMl/d/11/IU .41....i

•• n. Sloll ef Bilw

E•lfd'I.

turnover instead of 66 2/3 % of the same?

(ii) Whether Member, Board of Revenue, having held that "in the oircumstanoes the petitioner had prima f acie bona fide grounds for his belief that the arrangement which the Department had entered into, would continue" could legally hold that the petitioner was not entitled to be asaessed in terms of the said arrangement?

(iii) Whether in the facts and circumstances

of the cs.se, it ia open to the Department to challenge the continuance of the arrangement arrived at between the State Government and the petitioner especi ally so when the State Government by its own acts or omissions misled the petitioner into maintaining his accounts in a manner prejudicial to the petitioner's

claim for deductions on account of sale of tax free goods during tho period ?

(iv) Whether in tho facts and circumstances of the case, the petitioner was entitled to tile entire deduction on account of sale of meat and fish in terms of Notification No. 5564 Ft. dated 30.3.49 under section 6 of the Bihar Sales Act. 194 7 ?

(v) Whether the Member Board of Revenue having held that meat and fish mentioned in N oti.fication No. 5564 Ft. dated 30-3-49 under section 6 of the Bihar Sales Tax, Act. 1947, included boiled meat and fish and cold meat and fish, could legally hold that meat and fish cooked otherwise were not covered in the terms of said notification?

(vi) Whether in terms of the Notification No. 5564 Ft. dated 30-3-49 cold meat and fish and boiled meat and fish could be distinguished from other preparllition of meat and fish ?

But the Board of Revenue referred the following question to the High Court under s. 6 :-

"Whether the following forms of meat and fish are covered by Notification No. 5564 Ft., dated 30-3-49, issued under section 6 of the Bihar Sales Tax Act, 1947?

(i) Raw (i.e. uncooked in any way) meat or fish.

(ii) Boiled meat and fish, cooled or uncooled, meant for sale or consumption outside the petitioner's premises.

(iii) Fish or meat, which has been boiled or cooked in some other way served as separate or part of a dish outside the petitioner's premises as separate dishes or part of a menu.

(iv) Fish or meat, which has been boiled or cooked in some other way, served as separate dil:lhes or part of a dish outside the petitioner's premises."

- The High Court reframed the question as follows :-

"Whether the petitioner was entitled to exemption under Notification No. 5564 Ft., dated 30th arch, 1949, issued under. section 6 of the Bihar Sales Act, 1947 with regard to the sales of the preparations of, meat and fish e.g., meat curry and fish curry served as separate dishes, or as part of the menu, at lunch or dinner, at the petitioner's premises or outside ?" and answered it against the appellant. It is against the order of the Board of Revenue that the appellant has come in appeal by special leave but has

196B

M / s. Ballabhda1

Agarw41

Th4 Slak of Bihor

Kapur J.

JI f •. /lallabild OI

.igarwal

Tlw Stall oJ Bilw

KaprwJ,

972 SUPREME COURT REPORTS [1962). SUPP.

not appeared against the judgmt>nt and order of the B 1gh Court.

Thi" Court in M/s. Chi.mnonl<ill Ram.e.lnmrlnll v.

Com111i->sioner of Income-tax ( Centrnl) Clllc.utt11{ 1) held that in <"ll.Set whPre a reference is made to the High Court ancl tho appeal is brought only against the order of the Income Tax Appellate Tribunal thPn the 8upreme Court, if it intl'rferNl, would in fact be SC'tting aside the judgmont of the High Court without

there being an appeal to this Court, and that this Court cculd not bypafs the normal proreduro which

was to l.io adopted for tho purpose. In a later .Judgm••nt i11 Charuli Pra.sad Cho!.:hani v, Strife of

Bihar(') a Rimilnr view was taken that as the assessco had nut obtained 8pocial Leave in resywct. of any of the orders pasROd by the High Court un'.ler s. 2:; thos" onltJrs became final arid binding and the lB:!essce could not he allowed to bypass or o behind 1 hu or<l rs of tho High Court and such exorcise woulrl b" particularly inadvisable in a cas> whero tho result may be a conflict of the rlecision •Jf two courts of competent jurisdiction, which was e<Jntrary to the oliject of ss. 23, 24 all(! 25 of the Act. In this view of the law the appellant i~ not entitled to agitate tho corrcctnrsH or othcrwiso of the rlccision given by the Tribunal in rcganl to the questionH which wo agitflted before t.ho High Court and were decido<f against the appellant anr! ag:i.inst which no"

appeal h:J.11 been brought.

But he submit:i that there arc three other questions which also aride, and on which the sppell ant wanted a reference to Lhe High Cvurt. I.Jut whioh W!ll'tl not referred. It was open to tho appt•llant to apply to the High Court for u. reference under s. :!5. That the appellant did not do, and iL has not been shown that there was any such hreach

A.LR. 19"0 S. C. 280.

(2) A.l.R. 1961 S.C. 1708,

of the rules of natural justice or violation of any principle oflaw which would be a good ground for

011r interference direct with the orders of the Board of Revenue in an appeal under Art. 136 of the Constitution.

In our opinion the appeal is without force and is dismissed with costs.

Appeal dismissed.

THAKUR NARWAR SINGH v.

THE STATE OF MABHYA PRADESH

(J.L. KAPUR, M. HIDAYATULLAH and RAGHUBAR

DAYAL, JJ.)

Criminal Tria/,-Offences committed in . Princely Bt, at, e prior to merger with Iwrlian Dominion-If and when the Indian Penal Code applicable to such offences-Madhya Bharat Ordinance No. 1of1948-Part B 8t, ates (Laws) Act, 1951 (~ qf

1951) •. 6.

The appellant had committed certain offences in the State of Jhabua 'in 1948, when the Jhabua State was not a part of Dominion of India.

He was tried in 1955 under the J ndian Penal Code, for the offences committed in the erstwhile State of Jhabua in 1948.

The question was whether the appellant could be tried in 1955 under the Indian Penal Code for offences committed in 1948 in the erstwhile State of Jhabusa.

The Raja of Jhabua State by a notification had made iipplicable amongst other laws the Penal Code of India to the , State of Jhabua. After Jhabua State became part of the State of Madhy~ Bharat, the Rajpramukh by Ordinance No. I of 1948 continued the laws already in force in State of Jhabua.

The Part B States (Laws) Act 1951 (3 of 1951) s. 6 while repealing all the existing laws of the State inter alia saved the laws dealing with any peoality, forfeiture or pu.nishmeot incurred in respect of any offence committed against any law repealed.

Held, in 1948, when the offences were committed the ..

196%

i\ 1 / s. Ballabhdas

Agarwal

Tiu Slate of Bihar

Kapur J.

F.t; ruary 2

General Sales Tax Act

S. BALLABHDAS AGARWAL

THE STATE OF BIHAR

L. KAPUR

DAYAL, JJ.

ss. 6

Bihar Sales Tax Act, 1947

s. 24

s. 25

Bihar Sales Tax Act, 1947

Art. 136

s. 6

s. 24

s. 25

section 6

section 6

s. 6

section 6

Bihar Sales Tax Act, 1947

section 6

Bihar Sales Act, 1947

s. 2

ss. 23, 24

Art. 136

Indian Penal Code

Penal Code

Indian Penal Code

Penal Code

s. 6


2. S.C.R.

SUPREME COURT REPORTS 973

of the rules of natural justice or violation of any principle oflaw which would be a good ground for

011r interference direct with the orders of the Board of Revenue in an appeal under Art. 136 of the Constitution.

In our opinion the appeal is without force and is dismissed with costs.

Appeal dismissed.

THAKUR NARWAR SINGH v.

THE STATE OF MABHYA PRADESH

(J.L. KAPUR, M. HIDAYATULLAH and RAGHUBAR

DAYAL, JJ.)

Criminal Tria/,-Offences committed in . Princely Bt, at, e prior to merger with Iwrlian Dominion-If and when the Indian Penal Code applicable to such offences-Madhya Bharat Ordinance No. 1of1948-Part B 8t, ates (Laws) Act, 1951 (~ qf

1951) •. 6.

The appellant had committed certain offences in the State of Jhabua 'in 1948, when the Jhabua State was not a part of Dominion of India.

He was tried in 1955 under the J ndian Penal Code, for the offences committed in the erstwhile State of Jhabua in 1948.

The question was whether the appellant could be tried in 1955 under the Indian Penal Code for offences committed in 1948 in the erstwhile State of Jhabusa.

The Raja of Jhabua State by a notification had made iipplicable amongst other laws the Penal Code of India to the , State of Jhabua. After Jhabua State became part of the State of Madhy~ Bharat, the Rajpramukh by Ordinance No. I of 1948 continued the laws already in force in State of Jhabua.

The Part B States (Laws) Act 1951 (3 of 1951) s. 6 while repealing all the existing laws of the State inter alia saved the laws dealing with any peoality, forfeiture or pu.nishmeot incurred in respect of any offence committed against any law repealed.

Held, in 1948, when the offences were committed the ..

196%

i\ 1 / s. Ballabhdas

Agarwal

Tiu Slate of Bihar

Kapur J.

F.t; ruary 2

1962 na1..,.NtJ;"f/A

•• Th Sl.U of .11.dlgo Pr.Us•

974 SUPREME COURT REPORTS [1£62) SUPP.

law in the State of Jhabua was the Tndian Penal Code and that law continued by the Ordinance I of 1948 of the Rajpramukh and the repealing Act, in the Part B States (Laws) Act 1951, and any penalty incurred in respect of any offence committed in 1948 "as punishable under the Indian Proa!

Code as applied to Jhabua State.

CIUMINAL APPELLATE JurusnrnTl<.:N: Criminal Appeal No. 130 of 1961.

Appeal by special leave from the judgment and order dated September 26, 1956, of the Madhya Pradesh High Court (lnrlore Bench) At In<lore in Cr. A. No. 8 of 1956.

B.K. Banerjee and Talcur Das Taneja, for the Appellant. l.N. Shroff, for the respondent.

1962. February 2. The Judgment of the Court was delivered by

KAPUR, J.-Thia appeal is directed against the judgment and order of the High Court of Madhya Bharat upholding the conviction of the appella11t under ss. 380 and 451 of the Indian Penal Codt'.

The quest ion for decision is whether the appellant could be tried in 1955 under the Indian Penal Code for offences committed by him in 1948 when the State of Jhabua, in which the offences were committed, was not a part of Dominion of India and whether the State Penal Code pid contain any provision corresponding to the Sections of the Indian Penal Code under which the appellant has been convicted.

In Jhabua State there is Thikana Jhaknawda whiah was a Jagir. Its thakur, Thakur Narayan Singh, died on November 11, I 945, without leaving a son. Hi8 two widows adopted Gajendrapal Singh, the second son of His HighneBS the Raja of Jnabua on July 15, 1946. Representations made by the appellant olaiming thP. suooession to the Thikana. were rejected by His HighneBS. His further representation to the then Political Agent wa.e also

• '

-~. \ -.

2 S.C.R.

SUPREME COURT REPORTS 975

rejected. It is alleged that the appellant entered in a conspiraoy with about 150 persons and on January 18, 1948, forcibly entered the Thikana and took possession of it and remained in unlawful possession for about 7 months when he gave up the poasession. The prosecution against him and 15 others under ss. 121, 295 and 455 of the Indian Penal Code started on October 7, 1955. He was convicted under ss .. 451 and 380 of the Indian Penal Code but all the other accused persons were acquitted by the Sessions Jude. Against his conviction the appellant took an appeal to the High Court but his appeal was dismissed and he has come in appeal to this Court by Special Leave.

When the appeal was heard on January 9, 1962, the question whether the appellant could be tried in 1955 under the Indian Penal Code for offences committed in 1948 in the erstwhile State of Jhabua and whether there were similar provisions in the penal laws of that State at the time of the commission of the offences was raised. As this question had not been raised in any of the courts below we adjourned the hearing of the appeal to enable the parties to place the necessary material before us. The argument was confined to this question only as we did not find any substance in any of the other points in the appeal.

According to the Report of the Council of Administration on the administration of Jhabua State for 1935-41 p.48, the then Raja of Jhabua State by notification applied amongst other laws the Penal Code of India to the State of Jhabua.

By Ordinance 1 of 1948 issuad by the Rajapramukh after the State of Jhabua beoame part of the State of Madhya Bharat which was replaced by Regulation of Government Act (Act 14 of 1948) the laws already in force in Jhabua were continued in that part of the Sta~ of Madhya Bharat. On February 22, 1951, the Part B States (Laws) Act, 1951, (Act

Ilfl

Thakur Narwar

Singh

TM 81.U of M adhJ• Praduh

trapurJ.

1mr1ur Narw11.1

Singh

Th.Stataof Madk7a Pradesh

KapUT J.

97G SUPREi\IE COURT 1-tEPORTS [1952] SUPP.

III" of 1951) was enactecl. Seoti;:..u il of U1at Act relates to rnpeals and savin$s Ii; provided : " If immediately uefore the appointed day, there is in force in any Part B State any law corresponaing to any of the Acts or Ordinances now extended to thD, t State, that law shall, save as otherwise expressly provided in this Act, stand repealed : Provided that the repeal shall not affect, (a) the preyious operation of any law so repealed or ...•••............

(b) any right, prtvilege, obligation or liability acquired, accrued, or incurred, under any law so repealed c) any penalty, forfeiture or punishment incurred in respect of any offence committed against any law o repealed ..... . rnd any such ............... remedy may be ..... . enfo1wid ........ ., ...... and any such penalty ..... . may be

1imposyd as if this Act had not been passed.' Thus it is clear that in 1948, when the offences were committed by t.he appellant, t.he law in the State of .Jbabua was the Indian Penal Code and that law m1s con tin !ltld by the Ordinance of the Rajpra.mukh and L'B Repealing Act and any penalty incurrerl in respect. of any .offence committed in 1948 is rmnishah le under the Indian Penal Code as applicl to .Jhabua State.

, This appeal is t, herefore without force and is dismissed.

Appeal dismissed.

~ 1

------~

Art. 136

THAKUR NARWAR SINGH

THE STATE OF MABHYA PRADESH

L. KAPUR

M. HIDAYATULLAH

DAYAL, JJ.

Indian Penal Code

Penal Code

Indian Penal Code

Penal Code

s. 6

Penal Code

ss. 380 and 451

Indian Penal Code

Penal Code

Indian Penal Code

ss. 121, 295 and 455

Indian Penal Code

Indian Penal Code

Indian Penal Code

Jbabua was the Indian Penal Code

Indian Penal Code


' 2 8.C.l{.

SUPREME COURT REPORTS 977

PUNJAB NATIONAL BANK LIMITED

(P. B.

K. L. KHARBANDA

GAJENDRAGADKAR, A. K. SARKAR and

K.N. WANCHOO, JJ.)

IndU81rial Dispute-Provision for computing benefit in terms of mmey-If applicable to m?netary benefit-Ba.nk Oterk made supervisor-Basic wages, computation of-All India Industrial Tribunal (Bank Disputes) Award, para 292 (7)-Industrl, al Disputes Act, 1947 (XIV of 1947) s. 330 (2).

The Sastri Award provided one scale of wages for clerks in all banks. It further provided for a special allowances to clerks who were assigned special posts requiring special skill.

Paragraph 297 (7) of the Award provided for fixing the basic wage• of employees of a bank who joined after January 31,1951 in the new scales prescribed. The respondent, who was a clerk in the appellant bank, was appointed a supervisor in 1951,.' The appellant fixed his basic wages according to the scale payable to graduate clerks and gave him the special alloNance prescribed by the Sa•tri Award.

The respondent made an application under s. 33C (2) of the Indu!lrial Disputes Act, 1947, for computing in terms of money the benefit to which he was entitled under the Sastri Award claiming that his basic wages should be fixed according to the scale prescribed by the Bink for supervisors. The appellant cont ended thats. 33@ (2) was not applicable to monetary benefits and that the respondent being a clerk his wages were rightly fixed.

Held, thats. 33C (2) of the Act was applicable to com putation of monetary benefits also to which a workman was entitled and the application was maintainable. The word "benefit" included both 'monetary benefit' as well as •non monetary benefit' and there was no reason to exclude 'mone .. tary benefit' th'"efrom.

The word used in s. 33C (2) was "computed" and not "converted" and compute means to calculate.

The provision of s. 33C (2) was concerned purely with execution and there was no reason to hold that it app lied to non-monetary benefits alone.

Glaxo Lboratories (India) J, imited, Bombay v. Shri A. Y. Manjrokar, (1955) L.A. 0. 505.

South Arco! Ekctricity Distribution Company Limited v. Elumilai, (195~) I.L.L.J. 624 and

IHB --

1961 """i'° N a1;...l BCtl Limil1d

•• X L. Kharb,,.d.o

"··"* J .

M.8. N.S; Tra"'flO"I•, Tiru<:hirapalli v. Rajaram (K) ( 1960) I.L.L.J. 316, referred to.

Held, further that the respondent was entitled to ba.ic salary according to the scale fixed supervison. The grades of supervisors were also d<s for workmen prevalent In the appellant bank.

The Sastri Award provided one grade for all clerical workmen by whatever name they were known in the bank.

In view of para 292 (7) of the Award basic wages of the respondent could not be reduced below what they would be under a point-to-point adjustment on the corresponding scale which he was drawing before the Sen Award, in this bank as a workm m.

Pul\iah National Bank Ltd. v. Thtir Workmtn, C.A. 450. of 1959, Decided on D<cembcr 6,1960, referred to.

Civu. APPF.LLATE JURISDICTION: Civil Appe'\I No. 103 of 1961.

Appeal by special leave from tbe judgment and order dated August 2,1960, of the Central Government Labour Court at Delhi in L. C. A. No. SO

of 1960.

A. V. Viswanatha Sastri and Naunit Lal, for the appellant.

S. T. Desai and Janardan Sharma, for the respondent.

1962. February 2. The Judgment of the Court w&a delivered by

WANCHOO, J.-Thi.s is an appeal by special lea.ve in an iBdustrial matter. The respondent Kharbanda is e. supervisor in the Punjab Nationel Bank Limited which is the appellant before us. The dispute relates to the fixation of his salary in accor. dance with the All India Industrial Tribune.I (Bank Disputes) A ward (hereinafter referred to as the Sastry award). The respondent made an applioe.• tion to the Central Labour Court, Delhi, under s. 33-0(2) of the Industrial Disputes Act, No. XIV

of 1947, (hereinafter called the Act), and his caae wns that he was entitled to certain benefits oape.ble of being computed in terms of money under the Sastry Award, but the appellant had made a wrong

. ,

...

...

' 2 s.c.n..

SUPREME OOUR'F REPORTS 979

calculation in fixing his basic salary. Therefore the respondent prayed that the benefit to which h~ was entitled by fixation of his basic salary correctly should be computed in terms of money and determined by the Labour Court. His case further was that when his basic salary was rightly fixed under Sastry A ward he would be entitled to a sum of Rs. 6,428.28 nP. as arrears upto the dat.e of his application.

The application was opposed on behalf of the appellant and two contentions were raised to meet the case put forward by the respondent. In the first place it was urged that the application was not maintainable under s. 33-C(2) of the Act and the Labour Court haii no jurisdiction to decide it.

Secondly, it .was urged that the manner in which the appellant had fixed the basic salary was correct and there was therefore no force in the contention of the reRpondent that he was entitled to certain benefits of which he had been deprived and which should be calculated by the labour court.

Before we deal with the two points which arise in the present appeal we may refer to the provisions of the Sastry A ward out of which the present dispute arises. Originally another tribunal known as the Sen Tribunal was appointed in June 19'19 to go into the disputes between various banks all over the . country and their employees.

The Sen Tribunal ma:le an award after an exhaustive inquiry but on appeal to this Court the said award was set aside in 1951. Thereafter Act II 0f 1951 was passed as a. temporary measure for freezing cert.a.in provisions of the said a.ward in order to prevent the spread of the prevalent unrest am, Jngst the bank employees in quP.stion. The said dispute was then referred by the central G<i>vernment to the Sastry tribunal in January 1952. This tribunal held an elaborate inquiry and made its .. award which was published on April 20, 1953.

19'1

Punjab Notional.

Bonk Limitd

E L. Irharhno ...

Wan; h .. J,

JN!

P1D1jd N•tinol

BilM Liait1d

•• lf.L. Khorbaa

w-.1.oJ.

980 SUPR!ME COURT REPORTS [1962] SUPP.

Appeals were preferred by the banks and their employNls against the said award before the La.hour Appellate Tribunal, and on April 28, 1954, the Appellate Tribunal substantially confirmed the recommendations and directions of the Sastry tribunal with certain modifications. In the present appeal, we are not concerned with the further history of rhe disRute, for it is admitted that the provisions of the Sastry award with respect to the matter in controversy before us have remained unmodified when finally the dispute was set at rest by the Industrial Disputes (Hanking Companies) Decision Aot, (XLI of 1955).

The Sastry tribunal deoided after oonsidering the matter from all aspects to provide only one scale for clerks in all banks, though banks them

selves were divided into four cl&l!Ses and the places where the baoks were situate were divided into three areas. In the present appeal we are oc>ncerned with Cla1!8 A, area I, for which t.he grade provided was from Rs. 85 to Rs. 280 with varying increments (see para J 19 of the award) to which it is unnecessary to refer. Aft3r having provided one cadre of clerks, the Sastry tribunal then oonsidered the question of certain special posts where the incumbent required special skill for the c-fficient discharge of his duties and the problem before it was whether there should be a separate scale for such special posts or whether the incumbents of such posts should be in the same scale as clerks with certain advantages in the shape

either of additional increments in the same soole or additional allowance over and above the scale or a combination of both. The Sastry Tribunal rejected the formulation of a separate IK'ale for these special posts and decided to grant a special allowance over and above the pay of the cleriMl scale. One suoh class of special posts with which the Sastry award was concerned was the class of supervi1ors to which the respondent belongs and it

2S.C.R.

SUPREME COURT REFORTS 981

provided -i special allowance of Rs. 50/- in the case of A class bank~ in area I for supervisors by para. 164 thereof.

Then arose the question of fixing the pay of the employees of the banks into the new scale provided in the award and that matter was dealt with in para. 292. '.The Sastry award divided the employees into categories, namely, (i) those who entered the service of the banks before January 31, 1950, and

(ii) those who entered the service of the banks after January 31, 1950. In the preeent case we are concerned with those who joined the service of the bank after January 31, 1950. The relevant provision with respect to such employees is cl. (7) of para 292 which reads as follows :-

" (7). The workmar. shall be fitted into the new scale of pay on a point-to-point basis as though it had been in force since he joined the service of the bank, provided that his adjusted basic pay is not less thawhat it would be under a point-to-point adjustment on the corresponding 'pre-Sen' scale." It may be mentioned that the respondent was appointed as a supervisor by the appellant on April 22, 1951 on the basic salary of Rs. 120/- per mensem. . At that time the basic '!Jcale for supervisors was Rs. 120-8-200-EB-J0-300 while there was a basic scale for graduateclerksetc. ofRs. 75-5-120- 8-200. The respondent was appointed on the initial

basic salary of Rs. 120/- per mensem. The dispute between the parties is that the respondent claims that his basic salary should be fixed under para 292(7) according to the supervisor's scale for the purposes of the proviso while the appellant claims that it can only be fixed at the highest on the scale for graduate clerks, and the appellant fixed the respondent's pay on that basis, and that led to the respondent's makin. g thtlresent application unde. r s. 33-0(2) of the Act. ne tribqna.l has foqnd in favour of the

J96S

Punjti> National

Bcnk Limited ..

K.L. Kharbanda

Wanchoo J,

; HI

,..,, job N111i4n.l

B..tLO.Ud

•• X.L. Xh .. 1 on'-

Want 1n J.

respondent. The appellant therefore applied for

special leave which was granted ; and that is how the matter has come up before us.

The first question therefore that falls for decision is whether such an application e&n be ma.de under s.33- C(2) of the Act, Section 33-C (2) reads

as follows :-

"(2) Where any workman is entitled to receive from the employer any bent•fit which is capable of being computed in terms of money, the a.mount at which such benefit should be computed may, subject to any rules that may, ma.de under this Act, be determined by such Labour Court a.a may be specified in this behalf by the appropriate Uovernment, and the amount so determined may he recovered as provided for in s11b-section (I)." It is contended on behalf of the appellant that s.33-C(2) deals only with such oases where the workman is entitled to receive from the employer 11.ny benefit which is non-monetary but. which could be computed In terms of money. It is said that it is only in such a case where the workman claims a non monetary benefit from his employer that he

can apply to the• labour court for converting the value of this non-monetary benefit into money and computing the amount due in teI'IDll of money. On the other hand, it has been contended on behalf of the respondent that the benefit to which e. workman may be entitled need not necessarily be non-monetary and that any benefit to which be is entitled under an award if it requires computation can be the subject-matter of an application under s. 33-0 (2). Reliance has been placed on behalf of the respondent in this connection on e. couree of decisions by the indlll!trial tribune.ls and the High Courts where the meaning of the word

"benefit" in sub-s.(2) has not been oonfined to non monetary benefits only.

2 S.C.R.

SUPREME COURT REPORTS 983

The crucial words which we have to interpret are "any benefit which is capable of being computed in terms of money". The word "benefit" is of wide .import, and the dictionary meaning thereof is "advantage, profit". This would naturally include monetary advantage or monetary profit. There is no reason therefore for excluding 'monetary benefits, from the word "benefit" used in this sub-section, unless it is clear frotn the words used that monetary benefits were not intended to be included in the wide word "benefit" used therein. It is urged on behalf of the appellant that we should exclude monetary benefits from the meaning of this word in the context of this sub-section because the word is qualified by the words "which is capable of being computed in terms of money". This, it is urged, suggests that the meaning of the word 'benefit" here excludes ntonetary benefits, for, according to the appellant, there would be no sense in computing monetary benefits in terms on money. But this contention overlooks the fact that the word used in the qualifying clause is "computed" and not "converted". If the word bad been "converted" and the clause bad read "which is capable of being

convert.id in terms of money" there would have been a clear indication that the benefit which was to be converted in terms of money was other than monetary benefit. The dictionary meaning of the word "corivert" is "to change by substituting an equivalent"; and if the word "convert" bad been used in the qualifying words, the argument that the word "benefit'' only means non-monetary benefit might be incontrovertible. But the word in the qualifying clause is "computed" and the dictionary meaning of the word "compute" is merely "to

calculate". Therefore, where the benefit to which a workman may be entitled has not already been calculated, for example, in an award which confers on him the. benefit, it stands to reason that sub-s.(2) would apply for oomput'\tion of such benefit if

funfab _N ,_ tion1l

Btt11k Limitad

K.L. Kh., b1nd&

Wach•• J,

1•61

/',,.j <b NcJi°"ti

B im.t Lintittd

Ir.C.. Eli4r6-la

w..nc.1 .. J.

there is di8J>Ut.e about it. Further, if we compare sub-s.(I) with sub-s.(2) of this section, it will appear

that suo-s,(Il applies to cases where any money is due to a workman from an employer under a settle

ment or an award or under the provisions of Chap.

VA and that contemplates that the amount is already computed or calculated or at any rate there can be no dispute about the oomputation or oalculr.- tion; while sub-s.(2) applies to cases where though the monetary benefit has been conferred on a workman under an award, it has not been caloulated or computed in the award itself, and, there is dispute as to its calculation or computation. It cannot therofore be said looking to the words used in sub-s.(2) that it only applies to cases of non-monetary benefit which has to be oonverted in terms of money. It appears to us that it can also apply to monetary benefits to which a workman may be entitled which have not been calculated or computed, say, for example, in an award and about their r.alculation or computation there is dispute bet'lteen the workman and the employer. It may be added that s.33-C was put in the Act for the purpQflell of execution in J 956 after the Industrial Disputes

(Appellate Tribunal) Act, (48 of 1950) was repealed in that year. The Appellate Tribunal Act con t&ined s. 20 which provided for execution of awa.rds and was in terms almost similar to s.33-C. When the Appellat.e Tribunal Act was repealed in 1956 a provision Himilar to that contained in s. !:O waa brought into the Act at the 88UlO time. It is clear therefore that s.33-C is a provision in the nature of executing and where the amount to be executed is worked out (for example in an award) or where it may be worked out without any dispute, 1.33.q I) will apply. But where the amount due to workman is not stated in the award itself and there is a dispute as to its calculation, sub-s.(2) will apply and the •orkman would be entitled to apply thereunder to have the a.mount computed provided he~

r' ! .

2 S.C.R.

SUPREJ.\IE COURT REPORTS 985

entitled to a benefit, whether monetary or nonmonetary, which is capable of being computed in terms of money.

This matter had come up before Appellate Tribuniil in l\J55 in Glaxo Laboratories ( lndia) Limited. Bombay v. Shri A. Y. Manjrekar. (1). 'l'he appellate tribunal took the view that s. 20 of the Appellate Tribunal Act was concerned purely with execution and there was no reason to hold that sub-s. (2) only applied to non-monetary benefits. '1 he same view was taken by the Madras High Court in South Electricity Distribution Company Limited v. Elumalril (2) by a learned Single Judge and again by the same High court in M.S.Y.S.

Transports' Tiruchirapalli v. Rajaram (K)(3 ) by a Division Bench. Looking therefore to the words of the sub-section and the previous decisions with respect tn them we are of opinion that the word "benefit" used in sub-R. (l) is not confined merely to non-monetarv benefit which could be converted in terms of 11101; ey but is concerned with all kinds of benefits, whether monetary or non-monetary, to which a workman may be entitled, say, for example, under an award and that the sub-section oomes into play when the benefits have to be comput,!ld or caloulated and there is a dispute as to the calculation or computation. After the benefits have been so computed, the workman can apply under.sub-s. (l) for recovcr.v of the amount in the same manner as arrears of land-revenue. As in this case, the Sastry award had conferred a benefit on the respondent and thosH like him by providing for fixation of pay in the new scale, even though that benefit may be monetary and therewas a disput11

between the parties as to the amount of tl:rat benefit, it was ope1;1 to the respondent-to apply to \, he labour court for computation of that benefit in terms of money, and the labour court would have

(I) (1955) L.A.C.505.

• (2) (1959) J.L.L., J. 624,

(3) (1960) J.t.L.J. 336.

P .. jtiJ National

Bank Limiwl

•• IC.L. Khmbanda

WiuwlwoJ.

Ifft

Punio • ft' •lion, l

&nit limikd

•• K'.L. Jrh., b,..U

jurisdiction to entertain the application and compute the amount due on the basis of the bt nefit conferred by the award.

This brings us to the next question, namely, •as to how the basic salary should be fixed.

The main emphasis on behalf of the appellant in this connection is on tho word "corres.ponding" appear ing in cl. (7) of para. 292. It is urged that the Saatry tribunal fixed one scale for all clerks and

as supervisors are clerks the respondent could only be considered as belonging to the corresponding scale for clerks in the appellant-bank for the application of the proviso and thereafter he would be entitled to the special allowance of Re. 60( • per meneem. On the other hand, the respondent contends that Eupervisors are workmen, as has been held in a diapute between this very bank and its supervisors, referred to an industrial tribunal which gave an award on April 4, 1967, (see the observations ofthia Court in the Punjab National Bank Ltd.

v. Their Workmen) (l), and therefore all tha.t was necessary to find out th" corresponding scale was to 1ee in what scale of workmen the respondent was

at the relevant time. In this connection, we ma.y incidentally add that it is not disputed by the appellant tha.t its supervisors, accountants and accounts in-charge are generally workmen under the Act, though some may not be so. The diffi culty, so far u the appellant is concerned, arose on account of the fact that the appellant had nine scales which applied to workmen of all kinds beginning with peons and chaukidars and ending with aocountants and accounts in-charge. Three of these scales were for what may be called subordi nate eta.If under the Sastry award while six were for what is clerical staff under the Sastry award. These six included the grade of supervisors. The appellant however contends that only

(I) C.A. 450of1959, Dockltd Oii December 9, 1960.

' '

"'i

2 S.0.R. SbPREME COURT REPORTs 987

four gra:des, namely (i) Assistant Cashiers. (ii) Head Cashiers, (iii) Undergraduate clerks, typists and Godown keepers, and (iv) Graduate clerks, all stenographers in sanctioned stenographer's posts, should be treated as clerks for purposes of correspondence with the scale for clerks fixed by the ::-astry

award and the remaining two grades, namely, (i) Supervisors, and (ii) Accountants and Accounts in-charge, should not be treated as clerks for the purpose of correspondence. In view, however, of the decision o{ the industrial tribunal in the dispute between the appellant and s0me of its supervisors and accountants already referred to, it is obvious that these two grades -for supervisors and accountants and accounts in-charge were also grades for workmen prevalent in the appellantbank. What the Sastry award did was to make one grade for all clerical workmen and when cl.

(7) spe iks of correspondence it relates in our

opinion to the corresponding grades of workmen by whatever name they may have been known in particular banks. The fact that certain clerical workmen in this bank were called clerks while certain others were called supervisors, accountants and accounts in-charge would not in our opini(, n make any difference to thequestion of correspondncfl, para 292 deals with workmen generally and not separately with clerical staff and subordinate staff. Further cl. (7) itself lays down that the workmen shall be fitted into the new scale of pay on a point-to-point basis and therefore when we have to find the corresponding scale for the purpose of the proviso in cl. (7) we have to look at the corresponding scale which relates to a workman at a time before the Sen award. Now if the supervisor's scale was the scale of a workman previous to the Sen award then it must be held to be a corresponding scale for the purpose of fixation so far as the respondent is concerned, irrespective of the name by which this class of workmen was designated in this particular bank. The proviso

Punja6 JV stional

Bank Limited v.

K. L. Kharh•ni.a

hnj•b Nationol

Bank CimiW

Kl Klt.rillNfa

Won&hoo J.

988 SUPREME <X>URT REPORTS [1962) SUPP. t

says th11t after adjustment the basic pay she.II not be leBB than what it would be under a. pointto-point adjustment on the corresponding pre-8en scale. If therefore the supervisor's scale is a.

workman's scale it must be the corresponding prc- Sen scale so far a.s the respondent is concerned; consequently his be.sic pa.y oa.nnot be fixed in the new era.le prescribed by the Sa.stry a.ward below what it would be on the corresponding pre-Sen scale. We ha. ve already pointed out that it has

been already held between this very bank a.nd its. workmen that supervisor's are workmen a.nd therefore the supervisor's scale in this bank was a workmen's scale; therefore when the fixation of pay has to be ma.de under cl. (7) we have to find out the corresponding workmen's scale in the case of the respondent at a. time before the Sen a.we.rd \l'nB ma.de and th1't in our opinion can only be the supervisor's scale, for supervisors hf!ove been held to be workmen between the parties to the present dispute. The fact that the Sastry a.we.rd provided for a specie.I pay for certain employees including super\•isors has no rE>levance on the question of correspondence which has to be worked out under

cl. (7) in order to find out the be.sic pay for purposes of fixation. In view of what we have said,

the superviloor's sea.le being a scale for workmen in this bank, the respondent is right in his claim

that his be.sic pa.y cannot be reduced below what it would be under a point-to.point adjustment on the corredponding scale which he was drawing before the Sen award. in this bank as a. workman.

In this view of the matter the view taken by the labour court is correct. Once the principle is fixed, there is no dispute as the amount due to the respondent.

The appeal therefore fails and is hereby dismiBBed wit b costs.

977

PUNJAB NATIONAL BANK LIMITED

K. L. KHARBANDA

GAJENDRAGADKAR

A. K. SARKAR

K.N. WANCHOO, JJ.

Disputes Act, 1947

s. 330

s. 33C

Disputes Act, 1947

s. 33C

s. 33C

s. 33

Industrial Disputes Act

s. 33

s. 33

Section 33

s. 33

s. 20

s. 20