STATE OF UTIAR PRADESH

R. B. AGARWAL

February 4, 1966

(P.

. GAJENDRAGADKAR, C. ]., K. N. WA1'CHOO, J.C. SHAH, B S. M. SJKRI AND V. RAMASWAMI, JJ.j

CoMtilllllon of Indio Art. 134( I)( c)-Hlgh Cornt acquiu p'1'sorr convlcttd by trial court-State's applit:otlon /or certi{icatl, II corrtp.i1nt.

If an accused person is convicted by the trial court and on appeal to the High Court, his conviction is set aside the State is entiUed to apply to the High Court for certificate under Art. l34(l)(c). Such an application cannot be rejected In I/mine on the ground that it is incompetent; it has to be entertained and considered and decided on the merits. (465 DJ

The relevant words in Art. 134(1 )(c) are wide in their •weep.

They authoriae an application for a certificate from any judpnent, final order, or sentence in a crimioal proceeding of a High Court.

The sweep 6f the relevant words used in Art. 134(1 )(c) being very wide, it is not necessary to took for any separate provision in the Cons11tution which would correspond to a. 417 Cof!e of Ctiminal Procedure. (464 HJ

Observations contra in S. Maiumdar v. A. Brahmachari and Others, Cr. A No. 21 of 1960, dt. 14-9-1964 and Start Government, Madhya

l'radh v. Ramakrl.thna Ganpatrao Llmsey and others A.l.R. 1954 S.C. 20, disapproved.

CRIMINAL APPELLATE JURJSDJCTION : Criminal Appeal No. 178 of 1965.

Appeal by special leave from the judgment and order dated August 26, 1965 of the Allahabad High Court (Lucknow Bench) at Lucknowin S. C. Appeal No. 85 of 1965.

O. P. Rana, for the appellant.

R. K. Garg, for the respondent.

The Judgment of the Court was delivered by

Gajendragadkar, C. J. If an accused person is convicted by the trial court, but on appeal to the High Court is acquitted, can the State move the High Court under Art. 134(1)(c) of the Constitution for a certificate that the case in question is a fit one for appeal to the Supreme Court? That is the short question which arises in this appeal by special leave.

The respondent R. B. Agarwal was committed to the sessions for trial by the Judicial Officer, Lucknow under sections 467 and 471 of the Indian Penal Code. The learned Assistant Sessions

Judge who tried his case, dropped the charge under section 471, but convicted the respondent under s. 467, l.P.C. and sentenced

. 1

u. P. STATE v. AGARWAL (Gajendragadkar, C./.) 463'

A him to suffer rigorous imprisonment for five years and to pay a fine of Rs. 10,000/· and in default to undergo further rigorous imprisonment for a period of two years.

The respondent challenged the said order of conviction and sentence by preferring an appeal before the High Court of Judicature at Allahabad, Lucknow Bench. The High Court allowed the respondent's appeal, set aside the order of conviction and sentence imposed on him by the trial court, and directed that he should be acquitted. The appellant, the State of Uttar Pradesh, then applied to the High Court for a certificate under Art. l34(1)(c) of the Constitution. The High Court has rejected the said application on the ground "that in view of the latest pronouncement of the Supreme Court in S. Majumdar v. A. Brahmachari and Others('). Article 134 does not provide for an appeal to the Supreme Court from an order of acquittal by the High Court". It is this order refusing to entertain the appellant's application for certificate on the ground that it is incompetent under Article 134(l)(c). which is challenged before us by the appellant in the present appeal.

Mr. Rana for the appellant contends that the words used in Art. l34(l)(c) are plain and unambiguous, and they do not justify the view taken by the High Court that it is not open to the State to move the High Court for a certificate in a case where the High Court has set aside the order of conviction and sentence passed by the trial court against an accused person. Article 134(1)(c) provides that an appeal shall lie to the Supreme Court from any judgment, final order or sentence in a criminal proceeding of a High Court in the territory of India if the High Court certifies that the case is a fit one for appeal to the Supreme Court. It will be noticed that in tLe present appeal, we are not concerned with the question as to whether the application made by the appellant for a certificate should be granted or not; that is a part of the merits of the enquiry which the High Court will have to hold in case we come to the conclusion that the High Court was in error in taking the view that the application made by the appellant was incompetent. The stage to consider the merits of the said application can arise only if and after the application is held to be competent.

Now the relevant words in Art. 134(1)(c) are wide in their sweep. They authorise an application for a certificate from any judgment, final order, or sentence in a criminal proceeding of a High Court. It is difficult to see how an order of acquittal passed by the High Court in an appeal preferred before it by convicted accused person cannot be said to be a judgment, or final order in a criminal proceeding of the High Court. Therefore, on the plain. words of Art. 134(l)(c), we see no escape from the conclusion

(I) Criminal Appeal No. 21 of 1960 decided on September 14, 1964.

SUYJUIMJI COtlaT J.BPOllTS

(1966) 3 S.C.lt.

that if an accused person is convicted by the trial court and on A appeal, the High Court sets aside the said order of conviction, • it would be competent to the State to apply to the High Covt for certificate under Art. 134(1)(c) of the Constitution. ,.

Art. 134(1)(a) and (b) confer a right of an appeal to this Court, whereas Art. 134(l)(c) confers a right on the aggrieved party to make an application for a certificate; and it is for the High Court to consider whether the certificate of fitness should be issued or not. Art. 134(1)(c) docs not, therefore, give the State a right to move this Court by way of an appeal against the order of acquittal passed by the High Court in appeal. Nevertheless, it has a right to move the High Court for a certificate in that behalf. In our opinion, this position is plain and unambiguous.

It, however, appears that in The State Government, Madhya Pradesh v. Ramakrishna Ganpatrao Limsey and Others (1), this Court has made certain observations which are likely to create an impression that an application for a certificate would be incompetent in regard to cases where an order of conviction passed by the trial Court has been set aside by the HigA Court on appeal.

The said case had come to this Court under Art. 136 by special leave, and on the merits this Court came to the conclusion that no case had been made out for interference by this Court with the order passed by the High Court which was under appeal. That shows that the question as to whether an application for a certificate can be made by the State against an order of acquittal by the High Court on appeal, did not fall to be considered at all. Even

so, incidentally, this Court has referred to Article 134 and has observed that Art. 134 does not provide for an appeal from a judgment, final order, or sentence in a criminal proceeding of a High Court if the High Court has on appeal reversed an order of conviction of an accused person and has ordered his acquittal.

In this connection, it has also been observed that there is no provision in the Constitution corresponding to s. 417 of the Code of Criminal Procedure and such an order is fmal, subject however to the over-riding powers vested in this Court by Art. 136 of the Constitution. With respect, the fact that no provision has been made in the Constitution which may be said to correspond to s. 417, Cr. P. C., is of no significance in view of the fact that tho

words used in Art. 134(l)(c) are wide enough to take in appellate orders of acquittal passed by the High Courts while dealing with appeals brought before them by accused persons who are convicted by the trial courts. As we have already idicated, te sll'.ee_P of the relevant words used in Art. I34(l)(c) bemg very wide, 1t ':5

hardly necessary to look for any separate provision in the Conslltution which would correspond to s. 417, Cr. P. C. Therefore,

I A.l.R. 19S4 S.C. 2J.

• D

• .D

.'F

u. P. STATE v. AGARWAL (Gaiendragadkar, c. J.) 465

we do not think that the observations made by this Court in Lim sey' s case(') can be said to represent correctly the true legal psi tion as to the scope and effect of Art. 134(l)(c) of the Constitution.

In Shantiranjan Majumdar's case(2) this Court was again dealing with an application brought before it under Art. 136 by special leave, and in considering the merits of the appeal, incidentally, reference has been made to the earlier decision of the Court in Limsey's case(•) and it has been observed that according to the said decision there is no provision in the Constitution corresponding to s. 417, Cr. P. C. and, therefore, the order of acquittal made by the High Court is final, subject however to the over-riding powers of this Court under Act. 136 of the Constitution: What we have said about the relevant observations made in Limsey' s case(') applies equally to the observations made in Shantiranjan M ajumdar 's case(2).

In our opinion, therefore, the true legal position is that if an accused person is convicted by the trial court and on appeal to the High Court, his conviction is set aside, the State is entitled to apply to the High Court for a certificate under Art. 134(l)(c).

Such an application cannot be rejected in limine on the ground that it is incompetent; it has to be entertained and considered and decided on the merits.

The result is the appeal is allowed, the order of the High Court refusing to grant a certificate on the ground that the application made by the appellant in that behalf is incompetent, is set aside and it is remitted to the High Court for disposal in accordance with law.

After we granted special leave to the appellant to file an appeal against the impugned order refusing to entertain the appellant's application for a certificate, as a matter of precaution, to save limitation, the appellant has also filed an application for special leave to appeal to this Court against the appellate decision of the High Court on the merits. We cannot and do not propose to deal with the said application, because 0.21 •· 2 of the Supreme Court Rules provides, inter alia, that where an appeal lies to the Supreme Court on a certificate issued by the High Court, no application to the Supreme Court for special leave to appeal shall be entertained unless the High Court has first been moved and it has refused to grant a certificate. We would, therefore, direct that the application for special leave filed by the appellant should stand over until the final decision by the High Court on the merits of the appellant's application for certificate which we are remitting to the High Court for decision in accordance with law.

Appeal allowed.

(I) A.l.R. 1954 S.C. 20.

(2) Cr. p. No. 21 of 1460 dt. Sept. 14, 1964

STATE OF UTIAR PRADESH

R. B. AGARWAL

February 4, 1966

GAJENDRAGADKAR

C. SHAH

V. RAMASWAMI, JJ

Art. 134( I)( c)

Art. 134(1 )(c)

Art. 134(1 )(c)

O. P. Rana

R. K. Garg

Gajendragadkar

Art. 134(1)(c)

Supreme Court

R. B. Agarwal

Lucknow

sections 467 and 471

Indian Penal Code

section 471

s. 467

State of Uttar Pradesh

Article 134

Article 134(l)(c)

Rana

Article 134(1)(c)

India

Art. 134(1)(c)

Art. 134(l)(c)

September 14, 1964

SUYJUIMJI COtlaT J.BPOllTS

Art. 134(1)(c)

Art. 134(1)(a)

Art. 134(l)(c)

Art. 134(1)(c)

Art. 136

Article 134

Art. 134

s. 417

Code of Criminal Procedure

Art. 136

s. 417

Art. 134(l)(c)

s. 417

Lim sey

Art. 134(l)(c)

Shantiranjan Majumdar

Art. 136

Limsey

s. 417

Shantiranjan M ajumdar

Art. 134(l)(c)

Supreme Court Rules

Sept. 14, 1964


SMT. SHYAM KISHORI DEVI

PATNA MUNICIPAL CORPORATION & ANR.

February 4. 1966

(K. SUBBA RAO, M. HIDAYATULLAH AND R. S. BACHAWAT, JJ.]

Bi/uJr and Orissa Municipal Act, 1922 (B. & 0. Act 7 o/ 1922), a. 107(l)(c). 117(1) and 38&-suptrsersion of Municipaliry-No1ific01/ons appointing ofjicr to act as Commissioners and as commJttt~Enhancenz1m of municipal taxts by such officer and si11i11g in uview 4' Committtt-V alidiry-Incorrtct a.rstssmmt, burdt" o/ proof o/.

On supersession of the Patna Municipality, the Stale Oo\-emment by a notification directed an officer of the Municipalily to exercise and perform tile powers and duties of tho Commissioner under a. 107 of the Bihar and Orissa Municipal Act, 1922. Under s. 117 every application presented to the Commissioners for review of an assessment or valuation had to be heard and determined by a Committee consisting of two Commissioners. two tax-payers and a Deputy Magistrate as provided in tbe section. By a later notiftcation, the Government directed each of tho three per.ons

mentioned therein-one of whom was the aforesaid officer, to exercise and 11erform the powers and duties conferred and imposed on Comminee constituted under s. 117 of the Act.

Pursuant to these notifications, the said officer enhanced the valuation of the holding of the appellant and the assessment thereof under s. 107(l)(c) of the Act and rejected the re'l'!ew petition under a. 117(1) of the Act.

Tho appellant llled a auit challenging the validity of the order of the officer.

HELD : (i) The order or the officer rejecting the objections filed by the appellant and enhancing the value of the holdings was without jurisdiction.

By a later otification, if it was intended to replace the committee by one or other of the throe persons mentioned therein. it would be beyond the powers ot the Government conferred under the provision• or •. 386(1)

(b) of !he Act. The effect of this clause is that all the powers and duties of the Commissioners conferred and imposed on them under the vario111 sections of the Act whether act:ng in oommittees or individually would be exercised by such person or per.tons as the Slate Government may direct.

So, the committee under s. 117 could have been constituted with one or more of the three per.; ons nominated by the Government under s. 386( I)

(b) of the Act. and two tax-payers nominated by them and a Deputy Magistrate nominated by the Government.

To say that when once the Commissioners vaca1ed their office on superaession it was impossible for them to nominate or elect two other tax-payers to the commitee within the

meaning of s. 117(1) would render inorerative all sections whereundor powers were conferred or duties imposed on Commissioners, and would make s. 117 (I) unworkable leading to the anomaly that the same officer wbo revised the assessment would sit in judgment over It. [471 O; 472

A-DJ

(ii) Under s. 107(1 )(c) of the Act, the burden ia upon the CommD- 1ioners, before they could amend the valuation and assessment already made, to establish that the previous assessment was incorrectly made by

r-ason. of fraud. mis-rcprcscntaion or mistake.

(472 G] C!vn. A.Pl'el.UTB JURISDICTION : Civil Appeal No. 812 or 1963.

A D

I F •

SHYAM KISHORI v. MUNIC. CORP. (Subba Rao, I.) 467

Appeal by special leave from the judgment and decree dated September 21, 1959 of the Patna High Court in Appeal from Appellate Decree No. 1766 of 1954.

Ramanugrah and Mohan Behari Lal, for the appellant.

S. P. Varma, for the respondents.

The Judgment of the Court was delivered by

Sobba Rao. J. This appeal by special leave raises the question of the true construction of subs. (!) of s. 117 of the Bihar and Orissa Municipal Act, 1922 (B. & 0. Act 7 of 1922), herein after called the Act.

Shrimati Shyam Kishori Devi, the appellant, is the owner of premises known as "Krishna Bhawan" situate on Fraser Road in the Town of Patna. Originally it bore holding No. 239, but after the Patna Municipal Corporation Act, 1952, was passed it was given holding No. 264 in Circle No. 6 of the Patna Munici pal Corporation. On August 4, 1944, the Patna Municipality was superseded by the Government initially for a period of three years but the said period was extended from time to time till the Patna Municipal Corporation Act, 1952, came into force.

On March 29, 1946, the Government issued a Notification directing that S. N. Sarkar, Assistant Special Officer of the Patna City Municipality, shall also exercise and perform the powers and duties which might be exercised and performec! by the Commissioners under s. 107, among other sections, of the Act. On November 21, 1949, the Government of Bihar issued another Notification directing that each of the three officers mentioned therein shall exercise and perform the powers and duties conferred and imposed on a Committee constituted under s. 117 of the Act. One of the said officers was the said S. N. Sarkar, who was also appointed under the earlier Notification dated March 29, 1946, to perform the duties and exer

cise the powers of the Commissioners .

During the periodical revisional assessment of the year 1950 in regard to the said premises, the valuation thereof was fixed at Rs. 1,800/· and its quarterly municipal taxes at Rs. 146-4-0; but as some additions were made to the said premises, on May 10, 1951, the valuation of the said premises was raised to Rs. 2,400/· and its quarterly municipal taxes were fixed at Rs. 195/-. On

November 17, 1951, S. N. Sarkar, the Assistant Special Officer of the Municipality, issued a notice to the owner of the premises informing her that the assessment of her premises was proposed to be fixed as follows : House-tax Rs. 262-8-0, Latrine-tax

Rs. 210/· and water-tax Rs. 210/· per qarter under s. 107 of the Act.

On December 20, 1952, the appellant filed a petition against the proposed enhancement of taxes before the said Assistant Special

oa SUPU)O COWT UPOl.TI

(1966)3 S.C.R.

Officer, but he rejected the petition. Thereafter, the asseasmcnt list was amended on January 10, 1952, enhancing the valuation of the holding in question to Rs. 8,400/- and the quarterly munici-. pal taxes to Rs. 682-8-0. Aggrieved by the said order, the appellant filed Title Suit No. 60 of 1952 in the Court of the Third Munsif at Patna for a declaration that the alteration made by the Assistant Special Officer in the assessment list was invalid and without jurisdiction and that the Municipality was not entitled to realise the enhanced assessment. She also asked for a permanent injunction restraining the Municipality from realising the said enhanced tax from her. To that suit the Patm1 Municipality was made the 1st defendant and the Administrator of Patna, the 2nd defendant.

The learned M unsif held that the order passed by the Assistant Special Officer was valid and dismissed the suit with costs. On appeal, the learned Subordinate Judge, Patna, held that the Assistant Special Officer had no jurisdiction to proceed under s. 107(c) of the Act, as there was no fraud, misrepresentation or mistake when the periodical assessment was made and on that ground, he allowed the appeal and decreed the suit. Thereupon, the respondents preferred a second appeal to the High Court of Patna.

A Division Bench of that Court held that after the supersession of the Municipality no committee could be constituted under s. 117 of the Act and that, therefore, the Special Officer, in the absence of any specific machinery to deal with such an application, had perfect jurisdiction to Jay out his own machinery to dispose of the same. After holding that the Assistant Special Officer had jurisdiction to dispose of the application for review, the High Court held that it had not been established by the assessee that there was no mistake in the earlier assessment. In the result, the appeal was allowed, the judgment and decree of the learned Subordinate Judge were set aside and those of the trial Court were restored. The assessee has preferred the present appeal by special leave against the judgment and decree of the High Court.

Mr. Ramanugrah, learned counsel for the appellant, argued that the High Court on a wrong construction of the relevant provisions of the Act held that s. ll 7(i) of the Act had become unworkable and that no committee thereunder could be constituted after the supersession of the Municipality. He further contended that the High Court had thrown the burden of proof wrongly on the appellant but it should have held that it was for the Municipality to establish that there was a mistake, fraud or misrepresentation in making the periodical revisional assessment and that, as there was no material placed by the Municipality before the C<iurt, it should have held that the condition precedent for reopening tlie earlier assessment had not been fulfilled.

Mr. S. P. Varma, learned counsel for the respondents, in addition to the contentions accepted by the High Court, souglit to take

• •

H •

SHYAM KISHO!ll v. MUNIC. CORP. (Subba Ran, I.) 469"

a preliminary objection that the suit was not maintainable. & this question was not raised in any ©f the Courts below, we did_ not permit him to do so.

The first contention turns upon the construction of the relevantprovisions of the Act and the Notifications issued by the Govern-. ment thereunder. It will be convenient at the outset to gather the - relevant provisions at one place.

Section 386. (!) When an order of supersession has. beenpassed under the last preceding section, the following consequences _ shall ensue :-

(a) all the Commissioners shall, as from the date of the order, vacate their offices as such Commissioners;

(b) all the powers and duties which may, under the provisions of this Act, be exercised and performed by the Commissioners, whether at a meeting or otherwise, shall, during the period of supersession, be exercised and performed by such person or persons as the State Government may direct;

" The relevant part of the Notification dated March 29, 1946-. reads : > ••

- t

in exe; i;~ -f th; p~~~;~ -~~~~~;~; i by. ~I~~~. (b). f ~b:~~ti~~ (I) of section 386 of the said Act, the Governor of Bihar is E pleased to direct that Babu S. N. Sarkar, Assistant Special> Officer of the Patna City Municipality, shall also exercise and perform the powers and duties which may be exercised and performed by the Commissioners under the provisions of sections 102, 105, 107, 111, 116, 122, 124, 125, 126, .......... "._ The relevant part of the Notification dated November 21 F 1949, reads : '

.. the G~~~;~~; -f.Blh~;· is' 'pi~sd i~· di~ci' tht e~h -f th~.

followin~ officers shall execise and perform all the powers. and duties, conferred and imposed on a Committee constituted under sections 117 and I I 8 of the said Act for the parpose of hearing and determining applications for review relating to assessment presented by the tax-payers. of the Patna City Municipality, namely :-

1. Mr. Bhubneshwar Pd., Special Officer I/C Patna City Municipalty. '

2. Mr. S. N. Sarkar, Assistant Special Officer I/C of the Patna City Municipality. '

3. Mr. Parmeshwar Dayal, Retired Deputy Magist~ rate".

'\ ,

SllYAM KISHORE v. MUNIC. CORP. (Subba Rao,!.) 47 l

function as members of the Committee or to nominate or elect two other tax-payers to that Committee within the meaning of s. 117(1) of the Act and that, therefore, the Government validly appointed the Assistant Special Officer to exercise the powers and perform the functions of the Committee under the said section.

If this construction be accepted all the sections whereunder certain powers were conferred and certain duties were imposed on the Commissioners would cease to be operative after the order of supersession. Only to avoid this contingency s. 386{l){b) of the Act in express terms says that all the powers and duties which may under the provisions of the Act be exercised and performed by the Commissioners, whether at a meeting or otherwise, shall be exercised and performed by such person or persons as the State Government may direct. The effect of that clause is that all the powers and duties of the Commissioners conferred and imposed on them under the various sections of the Act, whether to act in a body or in committees or individually, would be exercised by such person or persons as the State Government might direct thereunder. If that be the interpretation of s. 386( 1 ), the person

or persons appointed by the State Government thereunder would take the place of the Commissioners in the various sections of the Act. So too, in section 117(1) of the Act, which would run thus:

"Every application presented under the last preceding section relating to assessment made under ....••.... s. I 17 .......... shal be heard and determined by a Committee consisting of the person or persons appointed by the Government and two. tax-payers of the Municipality nominated by the said person or persons and one servant of the Government not below the rank of a Deputy Magistrate nominated by the District Magistrate in this behalf, provided that no person

or persons nominated or tax-payer shall be a member of the Committee appointed to hear applications from the ward for which he was elected and that three members shall form the quorum." If that be the effect of s. 386 on s. 117, the Committee under s. 117 could have been constituted with one or more of the three persons nominated by the Government under s. 386(1)(b) of the Act and two tax-payers nominated by them and a Deputy Magistrate nominated by the Government. This construction will give full effect to s. 117 of the Act, whereas the construction suggested by the learned counsel for the respondents and accepted by the High Court would make it unworkable. It is a well-known rule of construction that a court must construe a section, unless it is imp')S sible to do so, to make it workable rather than to make it unworkable. In the words of Lord Bramwell, the words of a statute never should in interpretation be added to or substracted from without almost a necessity. ' MlOSup.CI/66-17

SHYAM KISHORE v. MUNIC. CORP. (Subba Rao, J.) 473

A the suit under Order XI of the Code of Civil Procedure for the discovery of the relevant records of the three assessments and though the learned Munsif made an order directing the Municipality to do so, it failed to produce them. In the circumstances we must hold that the Municipality had not established the precondition for the re-assessment, namely, that the original periodi- 8 cal revisional assessment was vitiated by fraud, misrepresentation or mistake.

In the result, the appeal is allowed, the decree of the High Court is set aside and the suit is decreed with costs throughout.

Appeal allowed.

SHYAM KISHORI DEVI

PATNA MUNICIPAL CORPORATION & ANR

February 4. 1966

K. SUBBA RAO

M. HIDAYATULLAH

R. S. BACHAWAT, JJ.

Jr and Orissa Municipal Act, 1922

Bihar and Orissa Municipal Act, 1922

s. 117

s. 117

s. 107(l)(c)

Slate Government

s. 117

s. 386( I)

s. 117(1)

s. 117

s. 107(1 )(c)

Ramanugrah

Mohan Behari Lal

S. P. Varma

Sobba Rao

s. 117

Bihar and Orissa Municipal Act, 1922

Shrimati Shyam Kishori Devi

Patna

Patna Municipal Corporation Act, 1952

Patna Munici pal Corporation

August 4, 1944

Patna Municipality

March 29, 1946

S. N. Sarkar

Patna City Municipality

s. 107

November 21, 1949

Government of Bihar

s. 117

May 10, 1951

November 17, 1951

s. 107

January 10, 1952

Court of the Third Munsif at Patna

s. 107(c)

High Court of Patna

s. 117

Ramanugrah

S. P. Varma

Section 386

section 386

Bihar

Babu S. N. Sarkar

sections 117

Bhubneshwar Pd

Parmeshwar Dayal

s. 117(1)

s. 386

s. 386( 1 )

section 117(1)

s. 386

s. 117

s. 117

s. 386(1)(b)

s. 117

Bramwell

Order XI of the Code


S. RAMA IYER

I'.

SU'.'IDARASA PONNAPOONDAR

February 4, 1966

[K. SUDBA RAO, M. HIDAYATULLAH AND

R.S. BACllAWAT. JJ.)

Madras Cu/rfraring Tenants Pror.ctiori Act, (25 of 1955), s. 6li and Code of Ciril Procedure (Act 5 of 1908), s. 115-Deci>io11 by Reven11e Court

that petitioner wa\· not a cultjvating tenant-If revisable by Jliglr Court.

The respondent. claiming to he the cultivating tenant of the appellant. filed an application before the Revenue Court under ""· 3 ( 3) of the C Madra. Culti\'&ting Tenants Protection Act, 1955, praying for a declara tion that the amount deposited by him in the Court represented the correct amount of rent due from him to the appellant. The appellant denied that the respondent was his cultivating tenant. rhe Revenue Court held that the respondent was not the appellant's cultivating tenant. The High Court in a revision petition under s. 6B of the Act read with s. 115 of th<> Civil Procedure Code, held that the respondent was a cultivating tenant of the appellant and that the amount deposited represented the correct amount D due from him to the appellant.

In appeal to this Court the appellant contended that the High Court bad no jurisdiction, in revision. to set aside the finding of the Revenue Court rh:H the re•pon<lcnt "V>a'i not the appellant\ cultivating tenant.

HELD : The Revenue Court under the Act can exercise its juri1die lion only if a relationship of landlord and cultivating tenant exists between the contending partk.-s.

If its jurisdiction is challenged it must enqu:re into the existence of the preliminary fact and decide if it has jurisdiction.

U by an erroneous decision on a question of fact or law touching its lurisdiction a subordinate court assumes a jurisdiction not vested in it by Jaw or fai1s to exercise a juridiction so vested, its decision is not final and is subject to the revisional jurisdiction of the High Court. Therefore, the High Court had power to enquire into the correctnss of the Revenue Court's decisioM and on finding that the tenancy existed and that the Revenue Court had erroneously refused to exercise the jurisdiction vested ill it bys. 3(3), the High Court could set aside that decision under s. 115(b) of the Civil Procedure Code read withs. 6B of the Act. (447 H-

478 B; 478 D] CIVIL APPELLATE JURISDICTION : Civil Appeal No. 797 of 1963.

Appeal by special leave from the judgment and order dated March 27, 1959 of the Madras High Court in C.R.P. No. 1282 of 1958.

R. Ganaparhy Iyer. for the appellants.

R. Thiagarajan, for the respondent.

The Judgment of the Court was delivered by B1cb1w1t, J. On April 24, 1958, the respondent claiming to be the cultivating tenant of the appellant in respect of certain lands in Manapparavaivattam, Nannilam Taluk deposited Rs. 462/-

. .

aSrent for 1367 fasli in the Revenue Court (the Court of the Revenue Divisional Officer), Tanjore under s. 3(3) of the Madras Cultivating Tenants Protection Act, 1955 (Madras Act No. 25 of 1955) and filed an application before the Court praying for a declaration that the amount deposited represented the correct amount of rent due from him. The appellant denied that the respondent was his cultivating tenant. On July 31, 1958, the Revenue Court, Tanjore held that the respondent was not a cultivating tenant of the appellant and could not claim the benefit of s. 3(3) and dismissed the application. The respondent filed a petition in revision before the Madras High Court under s. 6-B of the Act read with s. 115 of th~ Code of Civil Procedure. The High Court came to the conclusion that the respondent was a cultivating tenant of the appellant and by its order dated March 27, 1959, allowed the revision petition and declared that the amount deposited by the respondent represented the correct amount due from him to the appellant. The appel' !ant now appeals to this Court by special leave.

Counsel for the appellant submitted that the finding of the Revenue Court that the respondent was not a cultivating tenant was a finding of fact and the High Court had no jurisdiction to set it aside on revision. On the other hand, counsel for the respondent submitted that the finding was in respect of a collateral fact upon the existence of which the jurisdiction of the Revenue Court under s. 3(3) depended and the High Court had ample power to revise the finding under s. 6-B of the Act. ·

Section 6-B is in these terms :

"The Revenue Divisional Officer shall be deemed to be a Court subordinate to the High Court for the purposes of section 115 of the Code of Civil Procedure, 1908 (Central) (Act 5 of 1908), and his orders shall be liable to revision by the High Court nnder the provisions of that section."

Section 6-B empowers the High Court to revise the decision of the Revenue Divisional Officer under s. 115 of the Code of Civil Procedure, and for the purposes of the section, the Officer is deemed to be a subordinate Court. Section 115 is in these terms :

"The High Court may call for the record of any case which has been decided by any Court subordinate to such High Court and in which no appeal lies thereto, and if such subordinate Court appears- ·

(a) to have exercised a jurisdiction not vested in it by Jaw, or

(b) to have failed to exercise a jurisdiction so vested, or

476 SUPREME COtlllT llEPORTS

(1966] 3 S.C.R.

(c) to have acted in the exercise of its jurisdiction illegally or with material irregularity, the High Court may make such order in the case as it thinks fit.

In the present case, no question of revision under sub-s (c) of s. 115 arises, and we are concerned only with the power of revision under sub-ss. (a) and (b) of s. 115. Sub-section (a) empowers the High Court to correct an erroneous assumption of jurisdiction; sub-s.(b) empowers it to correct an erroneous refusal of jurisdiction.

The decision of the subordinate Court on all questions of law and fact not touching its jurisdiction is final and however erroneous such a decision may be, it is not revisable under sub-ss. (a) and (b) of s. 115. On the other hand, if by an erroneous decision on a question of fact or law touching its jurisdiction, e.g., on a preliminary fact upon the existence of which its jurisdiction depends, the subordinate Court assumes a jurisdiction not vested in it by law or fails to exercise a jurisdiction so vested, its decision is not fmal, and is subject to review by the High Court in its revisional jurisdiction under sub-ss. (a) and (b) of s. 1I5. The question is, on whicb side of the line the present case lies, and whether the decision of the Revenue Divisional Officer that the respondent is not a cultivating tenant of the appellant is subject to review by the High Court in its revisional jurisdiction. The Revenue Divisional Officer is an inferior Court of limited jurisdiction functioning under the Madras Cultivating Tenants Protection Act, 1955. To ascertain the limit and extent of its jurisdiction, we must examine the provisions of the Act.

The Act came into force on September 27, 1955 and was amended from time to time.

Originally, the Act was temporary, recently it has been made permanent. The Act was passed for the protection of certain cultivating tenants from eviction. Section 2 defines, inter alia, 'cultivating tenant' and 'landlord'. 'Cultivating tenant' is a person who carries on personal cultivation on the land under a tenancy agreement, express or implied, and includes any person who continues in possession of the land after determination of the tenancy agreement and the heirs of such person. 'Landlord' means the person entitled to evict the cultivating tenant from his holding or a part of it. Section 3( 1) protects the cultivating tenant from eviction at the instance of the landlord whether in execution of a decree or order of Court or otherwise. Section 3(2) sets out the grounds of eviction, and if one of these grounds is made out, the protection from eviction given bys. 3(1) is taken away. Section 3(3) enables the cultivating tenant to deposit the rent in Cou~.

Section 3(3)(b) requires the Court to "cause notice of the dep?s1t to be issued to the landlord and determine, after a summary enquiry, whether the amount deposited represents the correct amount of

~· ,

• \

F '

l H

rent due from the cultivating tenant". The expression "Court" in s. 3(3) means the Court which passed the decree or order for

eviction, or where there is no such decree or order, the Revenue Divisional Officer. The Act also vests jurisdiction in the Revenue Divisional Officer to entertain and decide an application by the landlord for eviction of a cultivating tenant-s. 3(4), an application by cultivating tenants evicted before and after the commencement of the Act for restoration ofpossession-ss. 4(1) and 4(5), an application by the landlord for the resumption of land for personal cliltivation-s. 4-A(l ), an application by the cultivating tenant for restoration of possession from a landlord so resuming possessions. 4-A(2), applications for resumption of possession by the landlord from his cultivating tenant and by the cultivating tenant from his sub-tenant provided the applicant was a member of the Armed Forces-ss. 4-AA(2) and 4-AA(3). On receipt of any application under ss. 3(4), 4(1), 4(5), 4-A(l),

4-A(2),

4-AA(2) and 4-AA(3), the Revenue Divisional Officer is required to hold a summary enquiry into the matter and pass necessary orders after giving a reasonable opportunity to the landlord and the tenant to make their representations. Section 4-B empowers the Revenue Divisional Officer in the case of any tenancy to impose a penalty on the landlord or the cultivating tenant for his refusal to sign or failure to lodge a lease deed in accordance with its provisions. Section 6 provides that no Civil Court shall" except to the extent specified in s. 3(3), have jurisdiction in respect of any matter which the Revenue Divisional Officer is empowered by or under the Act to determine, or shall grant an injunction in respect of any action taken or to be taken under such power. Section 6-A requires the Civil Court to transfer to the Revenue Divisional Officer any suit for possession or injunction in relation to any land pending before it, if it is satisfied that the defendant is a cultivating tenant. We have already noticed s. 6-B, which confers powers of revision on the High Court. Section T gives the State Government the power to make rules.

The Act gives generous protection to cultivating tenants from eviction, and severely restricts the right of landlords to resume possession of their land from their cultivating tenants. In case of disputes between the landlord and the cultivating tenant, the Revenue Divisional Officer is authorised to entertain and decide applications by the landlord for eviction and resumption of possession and by the cultivating tenant for restoration of possession and tio impose penalties on the landlord or the tenant for infraction of s. 4-B. To attract the jurisdiction of the Revenue Divisional Officer, there must be a dispute between a landlord and cultivating tenant. The existence of the relation of landlord and cultivating tenant between the contending parties is the essential condition for the assumption of jurisdiction by. the Revenue Divisional Officer

478 SUPRl!ME COUllT l.BPOl.TS

(1966] 3 S.C.R.

in all proceedings under the Act. The Tribunal can exercise it.

A jurisdiction under the Act only if such relationship exists. If the jurisdiction of the Tribunal is challenged, it must enquire into the existence of the preliminary fact and decide if it has jurisdiction. But its decision on the existence of this preliminary fact is not final; such a decision is subject to review by the High Court in its revisional jurisdiction under s. 6-B. The enquiry by the B Tribunal is summary, there is no provision for appeal from its decision, and the legislature could not have intended that its decision on this preliminary fact involving a question of title would be final and not subject to the overriding powers of revision by the High Court.

In the present case, the Tribunal found that the respondent was not the cultivating tenant of the appellant, and on such finding declined to exercise the jurisdiction vested in it by s. 3(3) to determine the correct amount of rent due by the respondent to the appellant. The High Court had power to enquire into the correctness of this decision, and on tinding that the tenancy existed and the Tribunal had erroneously refused to exercise the jurisdiction vested in it bys. 3(3), the High Court could set aside the decision under sub-s. (b) of s. 115 of the Code read with s. 6-B of the Act.

On a review of the entire oral and documentary evidence, the High Court found that the respondent was the cultivating tenant of the appellant. It is not shown that this finding is erroneous. We see no reason for interfering with the decision of the High Court.

The appeal is dismissed. There will be no order as to costs.

Appeal dismissed. ·

• I

S. RAMA IYER

SU'.'IDARASA PONNAPOONDAR

February 4, 1966

K. SUDBA RAO

M. HIDAYATULLAH

Madras

s. 6

s. 115

Tenants Protection Act, 1955

s. 6B

s. 115

Civil Procedure Code

s. 115(b)

Madras High Court

R. Thiagarajan

s. 3(3)

July 31, 1958

Revenue Court, Tanjore

s. 3(3)

s. 6

s. 115

Code of Civil Procedure

March 27, 1959

s. 3(3)

s. 6

Section 6

section 115

Code of Civil Procedure, 1908

Section 6

s. 115

the Code of Civil Procedure

Section 115

s. 115

s. 115

s. 115

s. 1I

September 27, 1955

Section 2

Section 3( 1)

Section 3(2)

Section 3(3)

Section 3(3)(b)

s. 3(3)

s. 3(4)

ss. 4(1) and 4(5)

s. 4

ss. 4

ss. 3(4), 4(1), 4(5), 4

Section 4

Section 6

s. 3(3)

Section 6

s. 6

s. 4

s. 6

s. 3(3)

s. 115

s. 6


....

I , '

• {

MAQBOOL ALAM KHAN

MST. KHODAIJA & ORS.

February 4. 1966

(K. SUBBA RAO, M. HIDAYATULLAH AND

R.S. BACHAWAT, JJj.

Lis penden~Respondent's nan1e expunged from title suit by compro- 1nise decree in another suit-Whether respondent constructively bound by 'final decree in title suit. Mohamedan law-Essential requirenients of valid gift.

The Maharaja of Dumraon filed a rent suit against some of the cosharers in a tenure held under him of certain lands and at the 9ale in execution the tenure was purchased by one L. N, the widow of one of the original co-sharers instituted a title suit. (No. 127 of 1939) for .a declaration that he.r share in the tenure was not affected by the execution sale.

During the pendency of this suit the Maharaja instituted a second rent suit against L and at the sale in execution of the decree the respondent purchased the tenure and obtained possession. The -respondent was also impleaded as a party in N's suit and a preliminary decree was passed.

Thereafter N died and the appellant was substituted as the plaintiff in place of N on the ground that before her death N had made an oral gift of her share to him. A final decree was then passed and the appellant obtained possession of the land dispossessing the respondent. Tho respondent then instituted title suit No. 126 of 1944 against the appellant 3.Jld others for a declaration that the decree passed in suit No. 127 of 1939 was not binding upon her. The case was disposed of by a compromise decree whereby the respondent's name was expunged from the category of eefendants in suit No. 127 though the decree was to stand in other respects.

The respondent then applied for restitution of the land under s. 144 ot the Code of Civil Procedure and obtained possession.

The appellant thereafter filed the present suit against the respondent and others for a declaration of his title. to the land and contended, inter alia, (i) that by the doctrine of Us pendens the respondent was constructively bound by the final decree in suit No. 127 of 1939 in the presence of her predecessor-in-title L; and

(ii) the decree conclusively dedared his title to the land on the basis of the oral gift made to him by N.

The trial court decreed the appellant's suit but on appeal to the High Court the decree was set aside.

On appeal to this Court,

HELD : The appellant had no title to the suit property and the High Court had rightly dismissed the suit.

The purpose of the compromise decree in suit No. 126 of 1944 was that the respondent's name should be expunged from the array of parti"' in suit No. 1Z7 of 1939 so that she should not be bound by tho decree in that suit either actually or constructively.

An application for restitution under s. 144 C.P.C. is an application for execution of a decree and therefore the principle of res-judicata applies to such proceedings.

Accordingly, in view of the restitution obtained by the respondent, she Wa5 not bound by the decree in suit No. 127 of 1939. [482

G-H)

•80 SUPJlEMB C.OUR T JlJIPOll TS

(1966] 3 S.C.R.

MahJ/ibhai v. Manlbhai (1965) 2 S.C.R. 436 applied.

The High Court bad rigblly hcJ.I that the appellant failed to prove the alleged oral ait't and furthermore, the gift was also in\1l!id.

The three requirement. of a valid gift under Mohamedan Law are declaration, acceptance and delivery of possession.

A gift of property in the possession of a Jessee or mortgagee or a trespasser is not established by mere declaration of the donor and acceptance by the donec. To validate B the gift there must also be delivery of possession, or failing such delivery. some overt act hy the donor to put it within the power of the donec to obtain possession.

On the facts N had done nothing after the alleged declaration to place it within the power of the appellant to obtnin possession. [483 G; 484 G; 485 BJ Case law referred to.

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 629 of 1963.

Appeal from the judgment and decree dated April 3, 1961 of the Patna High Court in Appeal from Original Decree No. 327 of 1955.

Sarjoo Prasad, R. S. Sinha, and R. C. Prasad, for the appellant.

S. C. Agarwal, R. K. GarK, D. P. Singh and M. K. Ramamurthi • for respondent No. I.

K. R. Sinha, for respondents Nos. 16, 24 and 25.

The Judgment of the Court was delivered by

Bachawat, J. Shaik Ahmad Ali was the holder of a tenure recorded in Khewat No. 4, tau1i No. 3309, Mouza Babhnaul, comprising an area of 83 82 acres under the Maharaja of Dumraon.

He died in 1910 leaving as his" heirs, his mother Waziran, his second wife Elahijan, three sons Amanat, Ashghar and Ashraf and two daughters born of F.lahijan, and two sons Hamid and Mahmud and four daughters horn of his first wife Nabiban. Though all the heirs of Shaik Ahmad Ali were cosharers of the tenure, the names of Hamid and Mahmud only were recorded as the tenureholders in the record of rights published in 1911.

The Maharaja of Dumraon instituted Rent Suit No. 13 of 1915 against Hamid and Mahmud only and obtained a decree for rent. The other cosharers of the tenure including Amanat were not parties to the suit. Amanat died in 1924.

Before and after 1924 there were several litigations concerning the rights of the cosharers in the tenure. Eventually, under a compromise, Najma the wife of Amanat got 2 annas 8 pies IO krant share in the tenure. Subsequently, the Maharaja of Dumraon put the decree in Rent Suit

No. 13 of 1915 into execution, and Latafat, son of Ashgar by his first wife Safidan, purchased the tenure at the execution sale.

In October 1928, Latafot obtained possession of the tenure through Court. Jn May 1939, Najma instituted Title Suit No. 127 of

• \

1939 against Latafat, the Maharaja of Dumraon and others asking for a declaration that her share in the tenure was not affected by the sale and for partition and possession of her share and mesne profits. During the pendency of this suit, the Maharaja of Dumraon instituted Rent Suit No. 1077 of 1939 against Latafat, obtained a decree for rent and put the decree into execution. At the execution sale in November 1940, Khodaija, the second wife of Ashgar, purchased the tenure. Thereupon, Khodaija was impleaded as a party in Title Suit No. 127 of 1939. On July 9, 1942, a decree declaring the title of Najma to her share in the tenure and a preliminary decree for partition were passed in that suit. On August 9,.

1942, Khodaija obtained delivery of possession of the tenure through Court on the basis of her purchase in November 1940. On February 26, 1943, Najma died. On April 10, 1943, the appellant filed a petition in Title Suit No. 127 of 1939 praying for substitution in . place of Najma on the ground that before her death Najma had made an oral gift of her share to him. On April 21, 1943, the Court passed an order substituting the appellant as plaintiff in the suit in place of Najma. On June 14, 1943, a final decree was, passed in the suit. The appellant was allotted 19·54 acres of land out of the tenure. On June 25, 1943, the appellant obtained possession of the land dispossessing Khodaija. Thereafter, Khodaija instituted Title Suit No. 126 of 1944 against the appellant and others for a declaration that the decree passed in Title Suit No. 127 of 1939 were fraudulently obtained and were not binding upon her.

The trial Court dismissed the suit, on appeal, the first appellate Court decreed the suit and a second appeal was disposed of by a compromise in these terms :

"1. That the name of the plaintiff No. I (that is Khodaija} from the category of defendants in Title Suit No. 127 of 1939 shall be expunged.

2. That the decree (in Title Suit No. 127 of 1939) will stand in other respects .

3. That the suit (that is, Title Suit No. 126 of 1944) wilt stand dismissed."

In 1948, Khodaija applied for restitution of the land under s. 144 of the Code of Civil Procedure. The Munsif allowed the application; on appeal, the first Appellate Court dismissed it; and on second appeal, the High Court passed an order on January 24,. 1949 declaring that Khodaija was entitled to restitution and remanded the case to the Munsif. On June 28, 1949, the Munsif directed restitution of 19 54 acres of land to Khodaija. On July I, 1949, Khodaija obtained possession of the land through Court.

Thereafter, the appellant instituted the present suit against Khodaija and others praying for a declaration of his title to the

SUPREME COURT REPORTS

[1966) 3 SC.R.

aforesaid land.

His case is that the suits instituted by the Maharaja -Of Dumraon were not rerit suits and the sales in execution of those decrees were not rent sales, inasmuch as all the sharers of the tenure were not impleaded as parties to those suits, the share of Najma in the tenure now represented by the suit land-was not affected by the sales, and by an oral gift she gave the land to the appellant.

The trial Court decreed the suit.

On first appeal, the High Court dismissed the suit. The appellant now appeals lo this Court by special leave.

The appellant rests his claim of title lo the land upon an alleged -0ral gift by Najma.

Khodaija disputes the factum and validity of the gift. In rejoinder, the appellant contends that by the doctrine of /is pendens Khodaija is constructively bound by the final -decree passed in Title Suit No. 127 of 1939 in the presence of her predecessor-in-title, Latafat and that the decree conclusively declared his title to the land on the basis of the oral gift by Najma. Khodaija gives a twofold answer to this contention. She says that (I) by the decree in Title Suit No. 126 of 1944 she was held not to be a party to Title Suit No. 127 of 1939 and she is therefore not bound by the decree passed in that suit, and (2) by the order of the High Court dated January 24, 1949 and the final order of the Munsif dated June 28, 1949 passed in the proceedings for restitution under s. 144 of the Code of Civil Procedure it was finally declared that she was not bound by the decree in Title Suit No. 127 of 1939. These contentions of Khodaija are sound and should be accepted. The compromise decree in Title Suit No. 126 of 1944 provided that Khodaija's name be expunged from the category of defendants in Title Suit No. 127 of 1939, and in other respects the decree in that suit would stand. The purpose of the compromise decree was that Khodaija's name should be expunged from the array of parties in Title Suit No. 127 of 1939, so that she would not be bound by the decree in that suit either actually or constructively.

On a construction of this decree, the High Court held on January 24, 1949 in the proceedings for restitution that Khodaija's claim for restitution fell within the purview of s. 144 of the Code of Civil Procedure and that "as a result of a compromise, the decree was set aside as against her." By his final order dated June 28, 1949 the Munsif directed restitution on the basis of this finding.

In Mahijibhai v. Manibhai ('), this Court by a majority held that an .application for restitution under s. 144 of the Code of Civil Pro- cedure is an application for execution of a decree.

The principle of res judicata applies to execution proceedings.

It follows that Khodaija is not bound by the decree in Title Suit No. 127 of 1939 :and is entitled to re-agitate all the questions in issue in that suit.

The appellant must, therefore, establish his title to the land.

He claims that after the preliminary decree Najma orally gave

(1) (19651 " S. C. R. 436.

• F

H •

• F

him her entire movable and immovable properties including the tenure, and she died after making over possession of the same.

She died leaving her father and mother as her heirs. Both her parents filed petitions in Title Suit No. 127 of 1939 supporting the oral gift of the suit land. This circumstance favours the case of oral gift. The appellant examined. himself as a witness in this case. He said that the gift was made on February 10, 1943 in the presence of his parents. His mother was alive, but she was not examined as a witness. The date of the gift was not mentioned in the plaint or in any earlier document; it was disclosed for the first time in the witness-box, and even then, it was not made clear how he remembered the date in the absence of any record. In the petition filed by him on April 10, 1943 in Title Suit No. 127 of 1939 he had made a different case and had stated that the gift was made a few months before her death on February 26, 1943. His case now is that Najma made a gift of her entire movable and immovable properties. This case was not made in the petitions filed in Title Suit No. 127 of 1939. The particulars of the other properties are not disclosed, nor is it shown that he ever took possession of those properties. In the plaint, he made the case that Najma died after making over possession of the tenure to him. This statement is untrue, because Najma had been dispossessed of the tenure in August 1942 and was not in possession of it at the time of the alleged gift.

Considering all the circumstances, the High Court held, and, in our opinion, rightly that the appellant failed to prove the alleged oral gift.

We also think that the alleged gift was invalid. In February 1943, Khodaija was in possession of the tenure claiming it adversely to Najma. After the alleged gift, Najma neither gave possession of the property, nor did anything to put it within the power of the appellant to obtain possession. The three pillars of a valid gift under the Mahomedan law are declaration, acceptance and delivery of possession. In Mohammad Abdul Ghani v. Fakhr Jahan Begam(I) Sir John Edge said : .

"For a valid gift inter vivas under the Mahomedan law applicable in this case, three conditions are necessary, which their Lordships consider have been correctly stated thus :

(a) manifestation of the wish to give on the part of the donor;

(b) the acceptance of the do nee either impliedly or expressly; and (c) the taking of possession of the subject-matter of the gift by the donee, either actually or constructively' (Mahomedan Law, by Syed Ameer Ali, 4th ed. vol. i, p. 41)."

The Prophet has said : "A gift is not valid without seisin." The rule of law is :

(I) (1922) L. R. 491. A., 195, 209.

484 SUPltl!MI! COUit! .Rl!POltTS

[1966] 3 S.C'.R.

"Gifts are rendered valid by tender, acceptance and seisin.-Tender and acceptance are necessary because a gift is a contract, and tender and acceptance are requisite in the formation of all contracts; and seisin is necessary in order to establish a right of property in the gift, because a right of property, according to our doctors, is not established in the thing given merely by means of the contract, without seisin." [See Hamilton's Hedaya (Grady's Edn), p. 482]

Previously, the rule of law was thought lo be so strict that it was said that land in the possession of a usurper (or wrongdoer)

-0r of a lessee or a mortgagee cannot be given away, see Dorrul Mokhtar, Book on Gift, p. 635 cited in Mu/lie Abdool Gujfoor v.

Muleka (1).

But the view now prevails that there can be a valid C gift of property in the possession of a lessee or a mortgagee and a gift may be sufficiently made by delivering constructive possession -of the property to the donee. Some authorities still take the view

that a property in the possession of a usurper cannot be given away, but this view appears to us to be too rigid. The donor may lawfully make a gift of a property in the possession of a trespasser.

D Such a gift is valid, provided the donor either obtains and gives possession of the property to the donee or does all that he can to put it within the power of the donee to obtain possession. In Mahomed Buksh Khan v.

Hosseini Bibi(1), Lord Macnaghten said :

"In this case it appears to their Lordships that the lady E did all she could to perfect the contemplated gift, and that nothing more was required from her. The gift was attended with the utmost publicity, the hibbanama itself authorises the donees to take possession, and it appears that in fact they did take possession. Their Lordships hold under these circumstances that there can be no objection to the gift on the p ground that Shahzadi had not possession, and that she herself did not give possession at the time."

But a gift of a property in the possession of a trespasser is not established by mere declaration of the donor and acceptance by the donee. To validate the gift, there must also be either delivery of possession, or failing such delivery, some overt act by the G <lonor to put it within the power of the donee to obtain possession.

If, apart from making a declaration, the donor docs nothing else, the gift is invalid. In Macnaghten's Muhammadan L1w, Precedents of Gifts, Case No. VI, the question was :

"A person executed a deed of gift in favour of his nephew, conferring upon him the proprietary right to certain lands, H of which be (the donor) was not in possession, but to rcover

(I) (1884) I.LR. IO Cat. 1112., 1123.

(2) (1888) !.. R. 15 T. A RI, 95.

• \

B ...

which he had brought an action, then pending, against hi~ wife ...... About a month after executing the deed, the donor died, and the donee, in virtue of the gift, lays claim to the litigated property. Under these circumstances is his claim, under the deed, allowable?" and the answer was that the gift was null and the claim of the donee was inadmissible. The precedent covers the present case. Najma did nothing after the alleged declaration. She did not even file a petition in Title Suit No. 127 of 1939 mentioning the gift and asking for the substitution of the appellant in her place. Had she filed such a petition and submitted to an order of substitution, she would have placed it within the power of the appellant to obtain possession of the property; but she did nothing. Nor did the appellant obtain possession of the property during her life time with her consent. The gift is, therefore, invalid.

It follows that the appellant has no title to the suit property and the High Court rightly dismissed the suit. During the pendency of this appeal, one Babula!, an heir of a co-lessee from Khodaija in respect of plot No. 1400, died, and the appeal has abated against him. The respondent contended that in the circumstances the entire appeal has become defective for non-joinder of necessary parties and must be dismissed. We think that the appeal, so far as it concerns plot No. 1400, is defective for non-joinder of necessary parties, but the rest of the appeal is not defective on this ground.

But for the other reasons already stated, the entire appeal is liable to be dismissed.

The appeal is dismissed with costs.

Appeal dismissed.

MAQBOOL ALAM KHAN

MST. KHODAIJA & ORS

K. SUBBA RAO

M. HIDAYATULLAH

R.S. BACHAWAT

L. N

s. 144

the Code of Civil Procedure

s. 144

C.P.C

(1965) 2 S.C.R. 436

Sarjoo Prasad

R. S. Sinha

R. C. Prasad

S. C. Agarwal

R. K. GarK

D. P. Singh

M. K. Ramamurthi

K. R. Sinha

Bachawat

Shaik Ahmad Ali

Waziran

Amanat

Ashghar

Ashraf

Hamid

Mahmud

Nabiban

Dumraon

Najma

Latafat

Ashgar

Safidan

Latafot

Khodaija

July 9, 1942

August 9,.

1942

February 26, 1943

April 10, 1943

April 21, 1943

June 14, 1943

June 25, 1943

Khodaija

s. 144

the Code of Civil Procedure

January 24,. 1949

June 28, 1949

July I, 1949

Najma. Khodaija

24, 1949

s. 144

the Code of Civil Procedure

January 24, 1949

s. 144

the Code of Civil Procedure

s. 144

February 10, 1943

Syed Ameer Ali

Macnaghten

Shahzadi

Babula


SURI RAM PRASAD (DECEASED) BY HIS LEGAi.

REPRESENTATIVE

I'.

THE STATE OF PUNJAB

February 7, 1966

[P. B. GAJENDRAGADKAR, c. J. K. N. WA1'Cl!OO,

M. HIDAYATULLAH, V. RAMASWAMI AND

P. SAITA1'ARAYANA RAJU, JJ.]

Corutitutlon of India Art. 357(2)-"tllingJ done or omitr•d re be done"--Scope of. : Bank of l'mia/a Reg11latlon and Management Order, 1954-validity of.

Rule 27 of Staff R11les framed thereunder-Whether violative of Art. 31 !- Whether staO rules infringe Art. 14. Corporation-Whether niajoriJy ca" exercise po11-ers of.

Patia/a Stale Reg11/ations-Applied to Bank employees by "ext<nsion"- JVht1ther extension executive acr.

On March 4, 1953, the President of India assumed powers of tbe Government of PEPSU (which in.eluded Patiala) under Article 356 of i11 Constitution. On February 27, 1954, in exercise of the powers vested in him by the Proclamation, the President issued the Bank of Patiala

Regulation and Management Order 1954, to provide for the heller regulation and management of the Bank.

By virtue of the power. conferred upon it by Clause 4( 1) (iii) of the Regulation Order, the Board of Directors of tho Banlt framed certain Staff Rules.

Rule 27 of which provided for compulsory retirement of employees of the Bank. ---

Tho appellanf, who was an employee of the Patiala State Bank wa• compulsorily retired hy an order of the Board under Rule 27 passed in June 1958.

He challenged the order in a suit mainly on the ground that Rule 27 was illegal and void.

The Trial Court granted a decree .ubstantially allowing the appellant's claim but on appeal, this decree W3' set aside by the High Coun.

In the appeal to this Coun, it was contended on behalf of the appellant, Infer alio, (i) that though the Regulation Order [Clause 4(l)(iii) of which delegated power to the Board of Directors of the Bank to frame staff rules) was made on February 27, 1954, it was not publi, hed in the Gazette until March 14, 1954, hy which time, in view of the revocation of the proclamation on ~1arch 7, 1954. the powers of the Prci~ dent to make rules governing the service conditions of Government servants in the State had lapsed and the delegation by the President to the Board of the Power to frame rules had ipso facto come to an end. The Bo&Td therefore, bad no authority to frame the Slaff Rules on Moreb 25, 1954 and to enforce them from April l, 1954; that in any event the Regulation Order v:ac; in effect and sub!itance a legislalive Act and, in ,;., w of the provisions of Anicle 3 57 (2), its operation could not extend

beyond the period of one year specified in that Anicle;

(ii) that prior to the promulgation of the Regulation Order in 1954 the Patiala State Regulations and other rules or orders. except the pension rules. made by the Ruler of Patiala. were applicable to the staff of the Patiala State Bank; the Staff Rules sought to supersede the provisions of the Patiala State Regulations and rules made by the Board. of Directota culd not abrogate the Regulations promulgated by the Rulor who exerciae6 the

• • •

• ' •

_ ..

" '

A powers of the Legislature; (iii) that Rule 27 was unconstitutional as it offended the guarantee under Anicle 311 of the Constitution and the Staff Rules were also violativo of Article 14; (v) that the Board which promulgated the Staff Rules had not been properly constituted inasmuch as some of the Directors were not present at the meeting.

HELD :

(i) Although the Regulation Order was made on February 27, 1954 and was not published in the Gazette until March 14, 1954, the order itself provided for its commencement on the date on which it

was made and it therefore came in to operation on February 27, 1954, i.e., before the termination of the President's Rule in PEPSU.

On a consideration of the provisions of the Regulation Order, it is manifest that those provisions were made for the better regulation and management of the affairs of the Bank and it would be an absurdity to hold that some of the pro; isions would cease to be in operation after the period of one year specified in Art. 357(2); all the clauses of the Regulation Order, including Clause 4(1)(iii), come within the purview of the saving clause in Anicle 357(2) which preserves the validity of "things done or omitted to be done" before the expiratwn of tho period of one year after the proclaimation has ceased to operate and the Regulation Order therefore continued to be in operation after the expiration of that year.

[494 B-H]

Foster v. Pritchard [1857) 2 L.J. Ex. 215; referred to.

(ii) The Patiala State Regulations were applied to the employees of the St•te Bonk of Patiala as a result of an "extension" mado by the Maharaja pursuant to the executive powers vested in him.

The act of extension being as executive act it could be changed by a similar executive act.

What was changed or superseded was the extension and not the E rules. [497 BJ

(iii) There was no force in the contention that Rule 27 offended Article 311 or that the Staff Rules were violative of Anicle 14. [498 F1

Motiram Deka v. N. E. Frontier Railway [1964] 5 S.C.R. 683, and Lachhman Das v. State of Punjab [1963) 2 S.C.R. 353; referred to.

(iv) The High Court had rightly held that under the law governing corporations, a majority of the members of the Corporation is entitled to exercise the powers of the Corporation and that the rule regarding corporations is equally applicable to a company. The Board was, therefore, properly constituted at the time w)len the Staff Rules were promulgated. [499 Al

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 530 of 1964.

Appeal from the judgment and decree dated December 19, 1962 of the Punjab High Court in Regular First Appeal No. 78 of 1961.

C. B. Aganva/a, K. P. Bhandari and R. Gopa/akrishnan, for the H appellant.

Bishan Narain, K. S. Chawla and R. N. Sachthey, for the respondents.

SUPREME COURT REPORTS [I 966] 3 s.c.ll.

The Judgment of the Court was delivered by

Satyaoarayana Raju, J. This appeal, on certificate granted by the High Court of Punjab, arises out of a suit filel! by one Ram Prasad, against the State of Punjab, for a declaration that the order of compulsory retirement passed by the latter against him was invalid.

Ram Prasad originally entered service as a Clerk, in the year 1924, in the Patiala Saddar Treasury in what was then the Patiala State. He was subsequently transferred in the same capacity to the Patiala State Bank on February 27, 1984 Bk and was confirmed in his appointment. On September I, 1985 Bk, he was promoted to the next higher grade on the establishment of the Patiala State Bank. Thereafter, he was promoted a~ Manager and posted to the Bhatinda branch of the Bank on April I, 1944. On April I, 1949 he was promoted as Selection Grade Manager by the Board of Directors of the Bank in the grade of Rs. 340-20-500-525-700.

On September 23, I 953 he was compulsorily retired from service but was subsequently reinstated by the Government on June 10,

1954 since the order was legally defective. On June 11, 1958 the Board passed an order compulsorily retiring him from service.

Ram Prasad challenged the order of compulsory retirement passed by the Board on various grounds, by means of a suit instituted in the Court of the Subordinate Judge, Patiala. He pleaded that the order of compulsory retirement amounted to 'dismissal or removal' from service within the meaning of art. 311 of the Constitution. He further maintained that r. 27 of the Bank of Patiala (Staff) Rules, 1954, hereinafter termed the Staff rules, under which the order of compulsory retirement was made, was illegal and void. The order was also challenged on the ground that it was ma/a fide.

The substantial relief claimed by him in the suit was a declaration that r. 27 of the Staff rules was wholly unconstitutional, null and void for the reasons stated by him.

The respondent contested the suit contending inter alia that the order of compulsory retirement was passed by the Board of Directors of the Bank under rules which were legal and constitutionally valid and governed the employees of the Bank.

The Subordinate Judge, Patiala, framed appropriate issues.

He found all but two issues in favour of the appellant and granted a decree substantially allowing the claims made by him. The respondent thereupon filed an appeal in the High Court of Punjab which allowed the appeal and set aside the judgment of the Subordinate Judge.

During the pendency of the appeal in the High Court Ram Prasad died and his widow was brought on record as his legal representative.

However, it will be convenient to refer to Ram Prasad as the appellant.

' •

D • ..

F •

• II

Before entering into the merits of the appeal, it would be convenient to refer very briefly to the historical background of the legislation. The Patiala State Regulations were first promulgated in the year 1908 and governed the employees of the State in matters relating to pay, allowances, leave, pension and travelling allowances. The Regulations were revised and re-published in the year 1931. Subsequently, they were again revised and re-issued as the Patiala Services Regulations in the year 1947.

Meanwhile, in April 1941, these Regulations were made applicable expressly to the Bank staff of the Patiala State Bank by the Maharaja, with the exception of the rules relating to pension. On August 20, 1948, Patiala became a constituent unit of the Patiala and East Punjab States Union (PEPSU). On the formation of the Union, the Patiala Services Regulations were made applicable to the entire territories of the Union by Ordinance No. I of 2005 Bk. Therefore the Patiala Services Regulations continued to govern the members of the Patiala State Services even after they became integrated into the PEPSU Services.

On March 4, 1953, the President of India assumed the powers of the Government of PEPSU, in exercise of the powers conferred on him by art. 356 of the Constitution.

On February 27, 1954, the President, in exercise of the powers vested in him in relation to PEPSU by the Proclamation, issued the Bank of Patiala Regulation and Management Order, 1954, E hereinafter called the Regulation Order, to provide for the better regulation and management of the affairs of the said Bank. We will have occasion to refer to the material clauses of this Order at a later stage.

By virtue of the powers conferred upon it by cl. 4(l)(iii) of the Regulation Order, the Board of Directors of the Bank framed F the Staff rules. Rule 27 of these rules, at the relevant date, was in the following terms :

"An employee shall retire at fifty five years of age provided that

(i) the Bank may, at its discretion and without giving any reasons, retire any employee from the Bank's service after he has completed the age of fifty years or the service of twenty five years whichever happens first and no -claim to special compensation on this account will be entertained;

(ii) the Bank retains the absolute right to retire any employee after he has completed JO years of service without giving any reasons and no claim to special compensation on this account will be entertained. This right will not be exercised except when it is the interest of the Bank

to dispense with the further services of an employee such as on account of inefficiency, dishonesty, corruption or infamous conduct.

Explanation I :

The action under proviso (ii) is intended to be taken : -,

(a) Against an employee whose efficiency is impaired but against whom it is not desirable to make formal charge of inefficiency or, who has ceased to 1'c fully efficient that is, the value of the empl0yee is clearly incommensurate with the pay which he draws. It is not the intention to use the provision as a financial weapon that is to say the provision shall be used only in case of employees who are considered unfit for retention on personal as opposed to financial grounds; {b) In cases where reputation for corruption, dishonesty or infamous conduct is clearly established even though no specific instance is likely to be proved under those rules.

The arguments advanced by Mr. Agarwala, learned counsel for the appellant, have covered a wide ground, but, in the main, he has impugned the validity of r. 27 set out above.

His contentions may be briefly summarised as follows :

(I) Prior to the promulgation of the Regulation Order in 1954, the Patiala State Regulations and other Rules or Orders, except the pension rules, made by the Ruler of Patiala, were applicable to the staff of the Patia!a State Bank. The Staff rules were made by the Board of Directors of the Bank by virtue of the delegation made in its favour under cl. 4(l)(iii) of the Regulation Order.

The delegation in favour of the Board lapsed on March 7, 1954 with the termination of the President's rule in PEPSU. Thereafter, the Board had no authority or power or jurisdiction to approve of the Staff rules on March 25, 1954 and to enforce them from April I,

1954. (2) The Board. assuming the delegation in its favour to be valid, was not vested with the power to make rules regarding compulsory retirement of the servants of the Bank. (3) The Staff rules seek to supersede the provisions of Regulation IX of the Patiala State Regulations. Rules made by the Board cannot abrogate the Regulations promulgated by the Ruler who exercised the powers of the legislature. ( 4) The Board which promulgated the Staff Rules had not been properly constituted inasmuch as all the Directors were not present at the meeting.

However, the main ground on which the validity of the staff rtIJes is challenged is that the Regulation Order, though made on

A February 27, 1954, was published in the Gazette only on March 14, 1954, that by reason of the revocation of the Proclamation issued \ by the President the power of the President to make rules governing the service conditions of Government servants in the State had lapsed and that the delegation by the President to the Board power to frame rules ipso facto came to an end when the Proclama-

B tion was revoked, on the principle that the delegate's power comes to an automatic end by reason of the principal's power having lapsed .

. - ~

1 Mr. Bishan Narain, learned counsel for the respondent-State, countered these arguments and maintained that the Staff Rules were valid. c We may initially set out the relevant facts with regard to the Proclamation of Emergency by the President and its revocation.

As already stated, by notification dated March 4, 1953, the Pre- • sident, in exercise of the powers conferred by art. 356 of the Constitution, assumed all functions of the government of the State of

PEPSU and all powers vested in or exercisable by the Rajpramukh 4 of the State. The Notification declared that the powers of the legislature of the State shall be exercisable by or under the autho- .. rity of Parliament.

I By an order made by the President on the same date, the President issued a direction that all the functions of the Govern-

E ment of the State of PEPSU and all the powers vested and exercisable by the Rajpramukh of the State under the Constitution or under any other law in force in the State shall, subject to the superintendence, direction and control of the President, be exercised by the Rajpramukh of the said State who was to act on the advice of

the Adviser appointed by the President in that behalf.

By notification dated March 21, 1954, in exercise of the powen • F conferred by cl. (2) of art. 356 of the Constitution, the President revoked the Proclamation issued by him under the said article on March 4, 1953.

When a proclamation is made under art. 356, it will be open to the President to specify in such proclamation (a) that he will G himself exercise all or any of the functions of the Govt. of the State or all or any of the powers vested in or exercisable by the Governor

'I or any body or authority in the State other than the Legislature of the State; (b) declare that the powers of the Legislature of the State shall be exercisable by or under the authority of Parliament.

When a declaration is made to this effect by the President, it shall JI be competent fo~ Parliament to direct that the legislative power of the State Legislature shall be exercised by the President himself or by any other authority to whom such power may be delegated by the President under art. 357 (1 ). Art, 357(2) provides that

any law made in exercise of the power of the legislature of the Sta.te by Parliament or the President or other authority referred to m sub-cl. (a) of cl. ( 1) which Parliament or the President or such other authority would not, but for the issue of a Proclamation under art. 356, have lx.-en competent to make shall, to the extent of the incompetency, cease to have effect on the expiration of a period of one year after the Proclamation has ceased to operate, but Cl. (2) of Article 357 makes an exception ........... .in the case of things done or omitted to be done before the expiry of the period of one year. It is argued firstly that the Regulation Order was not made before the date of revocation of the Proclamation.

It is said that the Order, though purporting to have been made on February 27, 1954 was not published in the Gazette till March 14, 1954.

It is doubtless true that the Regulation Order, though made on February 27, 1954, was not published in the Official Gazette till March 14, 1954. But cl. l(b) of the Order provides that it shall come into force at once and repeal all the previous Orders and instructions in so far as they are inconsistent with the pro visions of the Regulation Order. By reason of the fact that the Order itself provides for its commencement as the date on which it was made, it is clear that the Order came into operation on February 27, 1954, though it was published at a later date. The Order was therefore made before the date of termination of the President's rule in PEPSU.

Now, it is contended by learned counsel for the appellant that the Regulation Order is in effect and substance a legislative act and that its operation could not extend beyond the period specified in art. 357(2). It may be initially stated that this contention was not raised in the Courts below and there was no pleading or any issue covering that contention. Further, there is nothing on record to show that no order was passed during the period of one year provided by art. 357(2) extending the life of the Regulation Order beyond that period.

Coming to the contention, the question is whether, on a fair construction of all its provisions and its intendment, the Regulation Order comes within the scope of the expression 'things done' occurring in art. 357(2). In Craies On Statute Law, Sixth Edition, it is pointed out at p. 415 that if an Act is repealed with a proviso 'except as to things done under it' the proviso will receive a _liberal interpretation. In Foster v. Pritchard(') it was contended, with respect to an action tried after the passing of the County Courts Act, 1856, that the trespass committed by the defendant under colour of the process of the Court was not 'an act done under' th~ repealed section, but, said the Court, 'there can be no doubt that 1t was the

(I) [1857] 26 L. J. Ev. 215.

F •

• F

llAM PRASAD v. PUNJAB (Raju, J.) 493

intention of the legislature that the words in this proviso as to acts done under the repealed statutes should be construed in an extensive sense'. It is therefore open to the Court to find, on a fair construction of all the provisions of the Regulation Order which must be read as an integrated whole, whether they were intended to continue to be in force after the period specified in art. 357(2). It therefore becomes necessary to examine the provisions of the Regulation Order.

The Regulation Order provides that the management, control, supervision and direction of the affairs and business of the Bank shall vest in a Board constituted as provided in cl. 3(1). There can be no doubt that the management, control, supervision and direction of the affairs and business of the Bank are matters which were provided for not for a limited period but for an unspecified period even beyond the period of one year as provided by art. 357(2). Clause 4(1) is important. It provides that the Board shall pass the half-yearly balance-sheets and annual budget estimates and frame rules for the day to day working of the Bank.

We may, for the present, omit cl. 4(l)(iii). Sub-cl. (iv) provides that the Board may grant advances and fix limits upto which bills of exchange drawn by individual constituents may be accepted and frame rules in that behalf. Sub-cl. (v) provides for the Board framing rules regarding the Provident Fund for employees of the Bank, and sub-cl. (vi) for sanctioning expenditure and framing rules for its sanction by the Managing Director and other officers of the Bank. Under sub-cl. (vii), the Board shall invest the funds of the Bank in Government Securities, shares, debentures and other securities and sell them; under sub-cl. (viii), the Board shall borrow moneys and negotiate, transfer, sell, endorse, renew, pledge or mortgage Government promissory notes and other securities for the purpose of taking overdrafts and demand loans on their security; under sub-cl. (ix) issue instructions for the guidance of the Managing Director and require him to submit to the Board all information regarding the transactions of the Bank. Lastly, under sub-cl. (x) the Board shall delegate to the Managing Director, or subject to the Managing Director's supervision, to any of the other employees of the Bank any of the aforesaid powers. Clause 5 provides that the Board shall comply with such general or special directions as may from time to time be issue.d by the State Government.

Clause 6. provides for the meetings of the Board being held at least once m every three months or at such shorter intervals as the Chairman may decide and cl. 7 specifies the powers of the Managing Director. Clause 8 provides for the conduct of the business of the Bank. Clause 9 provides for the applicability of some of the provisions of the Banking Companies Act to the Bank.

Clause JO provides for the audit of the accounts of the Bank and

cl. 11 provides that the Board shall, at the end of every calendar

SUPREME COURT REPOJ.TS

(1966] 3 S.C.R.

year, submit to the State Government the annual balance-sheet A of the Bank accompanied by a report on the working of the Bank and that the Board shall submit to the State Government such ' other information concerning the affairs of the Bank as may from time to time be required by the State Government. ....

On a consideration of the provisions of the Regulation Order iet out above, it is manifest that those provisions have been made as is stated in the preamble to the Order, for the better regulation and management of the affairs of the Bank. Indeed, cl. 3 of the Order provides for the constitution of a Board of Directors for the management, control, supervision and direction of the affairs and business of the Bank. The matters provided, barring cl. 4(1) (iii), relate to the day-to-day administration of the affairs of the Bank. It is impossible to say that the matters provided for in the Order would cease to be in operation after the period of one year. It will result in an absurdity to hold, for instance, that provisions like the one for sanction of expenditure, would cease to be in operation after the period of one year.

We may now deal with cl. 4(1) (iii) which provides that the Board shall appoint, remove, dismiss and lay down the general conditions of service of the employees of the Bank other than the Managing Director and frame rules in that behalf. It is pursuant to the powers vested in it under this clause that the Board of Directors of the Bank made the Staff rules, including r. 27 whose validity is questioned. The expression 'things done' occurring in art. 357(2), in our opinion, must receive a liberal and extensive construction. As already indicated, all the clauses of the Regulation Order must be read together as an integrated whole and we have to find, on a construction of all the clauses, whether they were intended to continue beyond the period of one year provided by art. 357(2). In the context in which cl. 4(1) (iii) occurs, it is not unreasonable to construe the power to make rules vested in the Board under that clause as 'things done' within the meaning of art. 357(2). There can be no doubt about the intention to preserve and continue the rules even after the period of one year after the cessation of the Emergency so that there may not be any hiatus in the administration of the affairs of the Bank.

It must therefore be held that all the clauses of the Regulation Order, including cl. 4(1) (iii), come within the purview of the saving clause occurring in art. 357(2) of the Constitution and that they continue to be in operation after the period specified in that article.

On this conclusion it follows that the delegation made by the President in favour of the Board of Directors of the Bank under the Regulation Order did not lapse on the terminatio of the President's rule in PEPSU.

It is therefore unnecessary to

.... ..

• •

'~ A consider the decisions bearing on the question of the extent of the

~ authority or power of a delegatee.

) Learned counsel for the appellant has contended that the Patiala Services Regulations were existing law made by the Maharaja and it was not competent for the President to make the Regulation

B Order empowering the Board of Directors of the Bank to supersede those Regulations. The learned Judges of the High Court held that the President was competent to promulgate the Regulation Order under art. 309 read with arts. 330 and 372 of the Constitution. Having regard to the conclusion reached by us, that the Regulation Order was validly made, we consider it unnecessary c to go into the larger question whether the Regulation Order had the force of rules framed under art. 309.

It is then contended that the Patiala State Regulations governing the conditions of service of public servants were laws made by the erstwhile ruler of Patiala and could not be changed to the "

disadvantage of such public servants. The rules, as published

D on February 17, 1930 contain the following, in Part I, Chapter I, Preliminary, under the heading 'Right of Changing Rules' : , "I. The rules contained in these Regulations may not be modified or departed from except under the orders of the Ijlas-i-Khas based upon a report of the Finance Minister.

4. The rules in these regulations apply to all officers holding appointments in the Patiala State, except in so far

as they are over-ridden by distinct provision in any formal agreement entered into with the State by any officer." It is not the appellant's case that there was any formal agreement F between him and the State of Patiala that the rules shall not be changed during the period of his service.

The Patiala Services Regulations, Vol. I, published in 1947, preserved the right of the Maharaja to change the rules. Ruic 1.7, of Chapter I, reads :

G "Right of changing rules : The rules contained in these c Regulations shall not be modified or departed from except '

under the orders of the ljlas-i-Khas based upon a report of the Finance Minister." .,

Rule 1.7 of the 1947 Regulations corresponds to rr. I and 4 of the

H 1930 Regulations. The contention of the appellant that the rules could not be changed is not therefore sustainable. They can certainly be changed by an authority competent to change them as is evident from Exhibit P. 8, dated July 19, 1940. The chang; 10 Sup. CI/66-19

was in fact effected by the Maharaja in his administrative capacity.

Exhibit P-8 is as follows :

"The Patiala State Bank is a State Department governed by its Constitution laid down by the Ijlas-i-Khas, but being at the same time autonomous as regards its accounts, which are kept on commercial basis, it has become necessary to define how far tbe rules applying to other State Departments and the Patiala State Regulations shall apply to the Bank. The Board of Directors think and recommend that the internal management of the Bank shall be subject to rules and regulations framed by them subject to the following exceptions :-

(a) The P. S. R. shall apply to the Bank Staff with the eception of the pension rules, but instead thereof will have the benefit of a contributory Provident Fund, as already established.

(c) The Bank service shall be recognised as State service for the purposes of employment in State service of suitable candidates among the descendants of Bank employees.

The Chairman of the Board of Directors put up a note to the Maha E raja of Patiala underneath :

"I respectfully request that the recommendations of the Board of Directors of the Bank, as stated above, may graciously be sanctioned."

On this, the Finance Committee re-commended as follows : J1

"The Finance Committee recommends that

(I) Requets of the Chairman, Board of Directors, at (c), (e), (f) and (g) may be sanctioned.

(2) The request at (a) may be sanctioned adding the following 'and other State Rules or orders' after 'Patiala G

State Regulations' in the first line. '• "

This recommendation was made by the Revenue Minister and the Finance Minister who constituted the members of the Finance Committee. On this the Cabinet supported the recommendations of the Finance Committee and submitted the Slime to the Maharaj a.

These recommendations were accepted by the Maharaja on April 8, 1941.

H ..

It may be noted that the Order issued by the Maharaja on July 19, 1940, viz., Ex-P. 8 quoted above, is headed : 'Precis'.

It states that by reason of the fact that the Patiala State Bank is an autonomous department it became necessary to define how far the rules applying to other State departments and the Patiala State

Regulations applied to the Bank. It was specifically stated in the recommendation made by the Board of Directors that the internal management of the Bank shall be subject to rules and regulations framed by them. Two important exceptions were made and those were that the Patiala State Regulations shall apply to the Bank staff with the exception of the pension rules, but that the staff shall have the benefit of a contributory provident fund and that the Bank service shall be recognized as a State service for the purposes of employment in State service of suitable candidates from among the descendants of the Bank employees.

The Finance Committee, as provided in rr. 1-7 ot the rules, recommended that the request might be sanctioned. The Cabinet supported the recommendation of the Finance Committee. On this, the Maharaja made an endorsement : "We approve the recommendation of the Cabinet". This was dated April II, 1941.

It is therefore clear that the extension of the rules governing the conditions of service of Government servants to the employees of the State Bank of Patiala was the result of 'an extension' made by the Maharaja pursuant to the executive power vested in him.

The act of extension being an executive act, there can be no doubt that it could be changed by a similar executive act. Therefore it is clear that what was changed or superseded was the extension and not the rules.

It is contended on behalf of the appellant that r. 27 of the Staff rules is not valid since it vi6lates the constitutional guarantee under art. 311 of the Constitution. We may here refer to the position in law with regard to a rule providing for compulsory retirement. In Moti Ram Deka v. N. E. Frontier Railway(!) where the decisions on the question were reviewed it was stated :

"The next decision in the same volume is the State of Bombay v. Saubhag Chand M. Doshi, (1958) S.C.R. 571 =A.l.R. 1957 S.C. 892. This was a case of compulsory retirement under r. 165-A of the Bombay Civil Services Rules as amended by the Saurashtra Government. In so far as this case dealt with the compulsory retirement of a civil servant, it is unnecessary to consider the Rule in question or the facts relating to the compulsory retirement of the civil servant. It is of interest to note that in dealing with the question as to whether

L 10 Sup. CI/66-20

compulsory retirement amounted to removal or not, the tests which were applied were in regard to the loss of benefit already accrued and stigma attached to the civil servant. It is, however, significant that in considering the objection based on the contravention of Art. 311(2), Venkatarama Aiyar J., took the precaution of adding that 'questions of the said character coul<; i arise only when the rules fix both an age of superannuauon and an age for compulsory retirement and the services o_f a civil servant arc tenninated between these two points of time. But where there is no rule fixing the age of compulsory retirement, or if there is one and the servant is retired before

in~ age prescribed therein, then that can be regarded only as <llsm1ssal or removal within art. 311(2)'. It would be noucee1 tnat the rule providing for compulsory retirement was upne1e1 on tne ground that such compulsory retirement does not amount to removal under art. 311(2) because it was another mode of retirement and it could be enforced only between the period of age of superannuation prescribed and after the minimum period of service indicated in the rule had been put in. If, however, no such minimum period is prescribed by the rule of compulsory retirement, that according to the judgment, would violate art. 311(2) and though the termination of a servant's services may be described as compulsory retirement, it would amount to dismissal or removal within the meaning of art. 311(2). With respect, we think that this statement correctly represents the true position in law".

The validity of r. 27 cannot, in the instant case, be assailed on this ground.

It is then argued that the Staff rules are invalid because they offend art. 14. The ground of complaint is that different rules govern different public servants in the same State and that they are bad because they are discriminatory. This Court has held in a series of decisions culminating in the judgment of this Court in Lachhman Dass v. State of Punjab (1) that after the enactment of the States Reorganisation Act, 1956, different Acts in different parts of the same State could be sustained on the ground that the differentiation arises from geographical classification based on historical reasons. The contention raised by the learned counsel therefore fails.

There remains a minor contention which is that the Staff rules were not properly made by the Board of Directors. It is stated

that cl. 3 of the Regulation Order, which provides for a minimum number of six members, was not complied with and that since H the Staff rules were made by four members instead of six, they

(I) Jl963] 2 S.C.R. 353-A.I.R. 1963 S.C. 222.

were invalid. As pointed out by the learned Judges of the High Court, under the law governing corporations a majority of the members of the corporation is entitled to exercise the powers of the corporation and that the rule regarding corporations is equally applicable to a company. We are in agreeme11t with this vi<1w.

As a result of the conclusions reached ; by us, this appeal mu st fail and is dismissed. In the circumstances of the case there will be no order as to costs .

Appeal dismi3Hd.

RAM PRASAD (DECEASED) BY HIS LEGAL REPRESENTATIVE

THE STATE OF PUNJAB

February 7, 1966

P. B. GAJENDRAGADKAR

M. HIDAYATULLAH

V. RAMASWAMI

P. SAITA1'ARAYANA RAJU, JJ.

Art. 357(2)

Art. 31

Art. 14

March 4, 1953

Article 356

Clause 4( 1)

Patiala State Bank

Clause 4(l)(iii)

February 27, 1954

March 14, 1954

~1arch 7, 1954

Moreb 25, 1954

April l, 1954

Patiala

Article 14

PEPSU

Art. 357(2)

Clause 4(1)(iii)

Article 311

[1964] 5 S.C.R. 683

[1963) 2 S.C.R. 353

C. B. Aganva

K. P. Bhandari

R. Gopa

Bishan Narain

K. S. Chawla

R. N. Sachthey

Satyaoarayana Raju

Ram Prasad

State of Punjab

Ram Prasad

February 27, 1984

September I, 1985 Bk

Bhatinda

April I, 1944

April I, 1949

September 23, I 953

June 10,

1954

June 11, 1958

Subordinate Judge, Patiala

art. 311

High Court of Punjab

August 20, 1948

Patiala and East Punjab States Union

Patiala State Services

PEPSU Services

India

Government of PEPSU

art. 356

cl. 4(l)(iii)

Agarwala

Patia!a State Bank

cl. 4(l)(iii)

March 7, 1954

March 25, 1954

art. 356

Parliament

art. 356

art. 356

art. 357

art. 356

Article 357

art. 357(2)

art. 357(2)

art. 357(2)

County Courts Act, 1856

art. 357(2)

cl. 3(1)

art. 357(2)

Clause 4(1)

cl. 4(l)(iii)

Clause 5

Clause 6

cl. 7

Clause 8

Clause 9

Companies Act

cl. 11

cl. 3

cl. 4(1)

cl. 4(1)

art. 357(2)

art. 357(2)

cl. 4(1)

art. 357(2)

cl. 4(1)

art. 357(2)

art. 309

arts. 330 and 372

art. 309

February 17, 1930

Right of Changing Rules

State of Patiala

Maharaja

Maha E raja

Patiala G

State Regulations

Maharaj

April 8, 1941

July 19, 1940

Patiala State

April II, 1941

State Bank of Patiala

art. 311

Saurashtra Government

Art. 311(2)

Venkatarama Aiyar

art. 311(2)

art. 311(2)

art. 311(2)

art. 311(2)

art. 14

States Reorganisation Act, 1956

cl. 3