UNION OF INDIA v.

SURJIT SINGH ATWAL

January 18, 1979

[R. S. SARKAR!A AND 0. CHINNAPPA REDDY, JJ.J

Ffear-Plea of 11on-con1plia11ce with the prvvi_\i,_ins of Section 175\3) of the Govt. of India Act, 1935 is a n1ixed plea of fact and law-A plea not having hf'f.12 so pleaded in the. writtl'll state111ent and any i.1.11u' not having been so rai.1cd with regard to it, cannot be allowed later.

Pleadings-Denial of a contract-Civil I'rocedure Code, 1908 (Act V of 1908), Order VI Rule 8 and Order Vl/l Rule 2 scope of.

The respondent-plaintifI undertook the construction of a hard Runway, taxi tracks and dispersal roads at Dalbhumghar Aerodrome, pursuant to a formal \Vritten agreement with appellant.

The respondent completed the work.

At a subsequent conference, it \Vas agreed that the total amount of the final bill prepared in accordance \vi th the agreed rates less a sum of Rs. 50,000 /- should be paid forthwith and the balance of Rs. 50,000/- should be paid two weeks thereafter.

On the appella.nt's failur'e to make the payme\1t of Rs. 50,000/-, the respondent filed a suit on the original side of the High Court of Calcutta to recover the said sum together with interest.

The suit was dismissr-0 by a single judge but on appeal, the Division Bench of the High Court allowed the appeal and decreed the suit.

E Dismissing the appeal by certificate, the Court,

HELD: 1. A plea of non-compliance with the provisions of Section 175(3} of the GoverTJment of India Act, 1935 is a mixed plea of fact and law. [1006 B]

2. The plea of illegality of an agreement. not having been so pleaded in the \vrilten statement and no issue having been raised \Vith regard to it cannot be allowed lf,1ter.

To permit such a plea to be raised several years after the institution of the suit would greatly prejudice the plaintiff.

If such a plea had been raised, in the instant case, at th'e appropriate stage, the respondent-plaintiff might have come out with a suitable answer.

He might have had his ov.rn pleadings amended either by seeking to rest his case on the original agreement or under Section 65 or 70 of the Contract 1\ct. f1005 G-H, 1006 A]

3. The illegality of a contract must be specifically pleaded as much as the denial of a contract.

Under Order VJ, Rule 8 of C.P.C., where a contract is alleged in any pleading, a bare denial of the nrn~ by the opposite party hall ba construed only as a denial in fact of the express contract alleged or of the matters of fact from which the same may be implied, and not as a denial of the legality or sufficiency in law of such contract.

And, under Order VTIJ, Rule 2 C.P.C., the defendant must raise by the pleading all matters which show the suit not to be maintainable or that the transaction is either void or voidable ; n noint of law. [1006 B-Dl

Kalyanpur Lhne Works Ltd. v. State of Bihar and Anr. [1954] S.C.R. 958: referred lo.

• • •

• •

UNION v. s. s. ATWAL (Chinnuppa Reddy, J.) 1003

CtVIL APPELLATE JURISDICTION : Civil Appeal No. 2053 of 1969.

From th,, Judgment and Decree dated 16-7-68 of the Calcutta High Court in Appeal No. 199-A of 1964.

R. B. Bhatt, E. C. Agarwala and Girish Chandra for the Appellant.

H. B. Datar and Ashok Grover for the Respondent.

The Judgment of. the Court :was delivered by

CHINKAPPA REDDY, J.-Not content with raising a false plea, the appellant, Union of India has preferred this appeal on a technical ground.

The respondent-plaintiff undertook the construction of a hard Runway, Taxi tracks and dispersal roads at Dalbhumghar Aerodrome. There was a formal written agreement between the parties (Agreement No : A-Vll/96 of 1944-45).

The respondent completed the work in 1945.

The agreement provided for the work to be done "with stone at site".

As no stone was available at the site, stone had to be obtained by blast• ing a rock in a hillock. The rates stipulated in the agreement were on the basis that stone was available at site and not on the basis that stone had to be obtained by blasting rock.

Some of the rates, therefore, required revision.

There was a conference between the parties in November, 194 7.

On the side of the Government the Superintending Engineer, the Executive Engineer and the Deputy Accountant General were present. In respect of fourteen items of work the old rates were not altered.

In respect of ten items of work only the rates were altered.

Out of these ten items, rates were substantially increased for nine items but slightly decreased lot one item.

The rates agreed between the parties at the conference were the very rates which had been previously fixed by a Government Engineer named Ramani Roy and 'suggested to the plaintiff by the Superintending Engineer for his acceptance.

The plaintiff initially objected to the rates but withdrew his objections at the conference.

It was agreed that the total amount of the final bill prepared in accordance with the agreed rates, less a sum of Rs. 50,000/-, should be paid forthwith and the balance of Rs. 50,000 / should be paid two weeks thereafter.

As agreed the amount of the final bill, less Rs. 50,000/-, was paid but not the sumo( Rs. 50,000/-.

The sum of Rs. 50,000/- was not paid despite repeated demands by the plaintiff.

The plaintiff therefore, filed suit No. 531 of 1951 on the original side of the High Court of Calcutta on 24th January, 1951 to .recover the sum of Rs. 50,000/- together with interest.

In the plaint, as filed originally, the plaintiff stated that it was agreed that the work should be done by the plaintiff on the terms and conditions

mentiGned in certain letters that passed between the parties.

No re. ference to the written agreement was initially made in the plaint but by a later amendment reference was also made to the agreement No. A-VII/ 96. 1 he plaintiff further state<) in the plaint that after the completion of the work there was a conference in November, 1947 at Calcutta and an agreement was arrived at between the parties regarding the ra 'es at which the plaintiff was to be paid for the work executed by him.

He claimed that in accordance with the terms of the agreement arrived at in November, 1947, he had yet to be paid a sum of Rs. 50"000/-.

As we said earlier, the 'suit was filed on 24th January, 1951.

The defendant, Union of India, filed a written statement on 1st February, 1956, five years after the filing of the suit.

The contract for the execution of the work was admitted.

The completion of the work was admitted.

The conference alleged by the plaintiff to have been held in November 1947 was denied.

The agreement said to have been arrived at the conference was also denied.

These denials have been found to be false by the Courts below and the learned Counsel for the appellant had to admit before, us that the denial was 'unfortunate'.

It is u matter not merely of surprise but of shock to us that such a blatant false plea should have been raised by a Government in solemn proceedings before Court of law.

Far from setting an example as an ideal litigant, we notice that such false and untenable pleas are often raised on behalf of the Government.

This is a matter which needs looking into by the authorities that are concerned with it and we earnestly hope that some suitable remedial action will be taken to avoid such pleas.

To continue the story, no plea was taken in the written statement that the contract between the parties was hit by any failure to comply with the provisions of Section 175(3) of the Governmeut of India Act, 1935.

More than a dozen years after the institution of the suit and eight years after the filing of the written statement, an application for amendment of the written statement was filed on 25th April, 1964, to enable the defendant to raise the plea that the contract was hit by the failure to comply with the provisions of Section !75(31 of the Govt. of India Act. J 935.

The application was dismissed on 1st May, l 964, but it was observed that the defendant was entitled to raise the plea sought to be raised by the amendment even without an amendment. Thereafter the suit proceeded to trial. Mr. Justice Mallick who tried the case decided in favour of the plaintiff on the several questions of fact which were raised.

A question regarding compliance with the provisions of Section 80 Civil Procedure Code was also decided in favour of the plaintiff. He, however, held that the suit was based not on Agreement

• •

' ..

UNION v. s. s. ATWAL (Chinnappa Reddy, I.)

I 005

No. A-VII/96 of 1944-45 but on the agreement arrived at between the parties in November, 1947, that this agreement was bad for non compli1nce wit!: the requirements of Section 17 5 ( 3) of the Govt. of India Act 1935, and that the suit had, therefore, to be dismissed. On the basis of the finding that the 1947 agreement .-ms bad for non compliance with the requirements of Section 175(3) o: the Govt. of India Act, l 935, the learned Judge also held that the Court had no jurisdiction to entertain the suit. The suit wai accordingly dismissed.

On appeal, a Division Bench of the Calcutta Bigh Co•irt consisting uf A. N. Ray and S. K. Mukherjee, JJ., held that the defendant not having pleaded in the written statement that the cont"act contravened the provisions of Section 175(3) of the Government of India Act there being no issue with regard to Section 175(3), the learned Single Judge was wrong in entertaining such a plea, at that belated stage. It was observed that the request for amendment of the written statement was made thirteen years after the institution or the suit and that the plaintiff was greatly prejudiced by such a plea being entertained. ft was also held by the Division Ber.ch that there was no new egreement in November i947.

All lrat was done in November 1947 was to settle the rates for "additional or substituted work" as provided in clauses 12 and 12-A of the original agreement.

In view of their conclusion that the plea regarding the invalidity of the agreement should not have been entertained by the learned single Judge, !he Division Bench ldd that the Calcutta High Court had jurisdiction to entertain the suil.

The appeal was allowed a11d a decree was granted for Rs. 50,000/- with interest from the date of judgment.

The Union of India has preferred this appeal pursuant to a certificate granted under Article 133(1) (a) of the Constitution of India (as it stood prior to the 30th amendment) .

5hri Bhatt, learned Counsel for the appella'nt submitted that the suit was bscd on the agreement of N ovemkr, 194 7 and that this agre-ement was void as the provisions of Section 175(3) of the Govt. of India Act, 1935, were not complied with. We do not prima facie agree

th"t the suit was based on any agr2ement arrived at in November 1947.

G We do not, however, desire to go into the question as we are satisfied that the Appellate Court was right in holdi'ng that the defendant wa,> not entitkd to raise the plea of illegality of the agreement, not having so pleaded in the written statement and not having raised anv issue with regard to it.

We agree with the learned Judges of the calcutta High Court that to permit such a plea to be raised several years after H the institution of the suit would greatly prejudice the plaintiff. If such a pleJ had been raised at the appropriate stage, the plaintiff might have

come 0ut with a suitable a"nswer.

Ho might have had his own pleadings amended either by seeking to rest his case on the original agreement or under Section 65 or Section 70 of the Indian Contract Act. W•" do not wish to speculate on the possible alternate cases which the plaintiff might have put forward had the plea be•en raised.

We only wish to observe that the plea that the provisions of Sectio"n 175(3) of the Govt. of India Act had not been complied with is a mixed plea of fact and law.

We furth•cr agree with the view expressed by the learned Judges of the Calcutta High Court that the illiega:ity of a contrct must be specifically pleaded as much as the denial of a contract.

Order VI, Rule 8 provides that where a contract is alleged in any pleading, a bare denial of the same by the oppooite party shall be construed only as a denial in fact of the express contract all•cged or of the matters of fact from which the same may be imp:ied, a"nd not as a denial of the legality or sufficiency in law of such contract. Order VIII, Rulo 2 Civil Procedure Code pn:scribes that the defendant must raise by his pleading all matters which show the suit not to be maintainable, or that the transaction is either void or voidable in point of law. In Kalyar, pur Lime Works Ltd. v. State of Bihar and Anr.,(') the Supreme Court reverned the judgment of the High Court on the grou"nd that the High Court was not justified in allowing to be raised at the time of argument the question whether there was a contravention of Section 30 of the Govt. of India Act 1915. Reliance was placed upon Ord•cr VI, Rule 8 and Order VIII, Rule 2 of the Civil1 Procedure Code 1908. We are, therefore, of the view that the Division Bench of the High Court wa' right in holding that the lear'ned single Judge was not justified in per mitting the defendant to take up the plea that the contract was hit by the failure to comply with the requirements of Section 175(3) of lhc Govt. o: lndia Act. In the result the appal is dismissed with costs.

S.R.

Appeal dismissed,

(1) [1954] S.C.R. 958.

...

UNION OF INDIA

SURJIT SINGH ATWAL

January 18, 1979

0. CHINNAPPA REDDY, JJ

Section 175

India Act, 1935

Order VI Rule

High Court of Calcutta

C.P.C.

C.P.C.

ATWAL

Chinnuppa Reddy

R. B. Bhatt

E. C. Agarwala

Girish Chandra

H. B. Datar

Ashok Grover

CHINKAPPA REDDY

Union of India

Ramani Roy

24th January, 1951

Calcutta

1st February, 1956

Section 175(3)

Governmeut of India Act, 1935

25th April, 1964

1st May, l 964

Mallick

Section 80

Civil Procedure Code

Section 17

India Act 1935

Section 175(3)

Calcutta Bigh Co•irt

A. N. Ray

S. K. Mukherjee

Section 175(3)

Section 175(3)

Calcutta High Court

Union of India

Article 133(1)

Constitution of India

Bhatt

Section 175(3)

India Act, 1935

calcutta High Court

Section 65

Section 70

Indian Contract Act

Civil Procedure Code

Supreme Court

Section 30

India Act 1915

Procedure Code 1908

Section 175(3)


• ,

' '

MOHD. IQBAL AHMAD v.

ST ATE OF ANDHRA PRADESH

January 18, 1979 r.s. MURTAZA FAZAL ALI AND A. D. KosHAL, JJ.]

Prevention of Corruption Act, s. 5(2) read with s. 5(1) (d)-Case irrstuuieo 'k.'fthnut proper sallc/ion-Efiect of-Proof of valfd sanction--Ilow could be established-Sanction-Its importance in prosecution9--Facts coming into existence subsequently-If could be rele1ant-Pres11n1ptio11 that sanctioning

aurhurity "H-'as satisfied that the accused received bribc-JVhen could arise- If prosecution could be given a chance at appellate stage to prove that the sanctioning authori!Y had applied its 1nind before giving the sanction.

The appellant who was charged with an offence under s. 5(2) read with s. 5(1) (d) of the Prevention of Corruption Act was acquitted by the SpeCial Judge.

But !he I-ligh Court oq. appeal by the State, reversed the judgment of t'he Special Judge and convicted him.

ln appt-:i1 to this Court it v, ras contended on behalf of tht~ appellant that there was no evidence to show on what materials the sanctioning authority applied its mind before granting the sanction under s. 6 of the Act. The entire proceedings are void ab initiv.

Allowing the appeal,

HELD: 1 (a). The prosecution of the appellunt was without valid sanction and, therefore, cognizance taken by the Special Judge was \Vithout juris- E diet.on. [1011 GJ

(b) Any case instituted without proper sanction must fail because this being a n1anifest defect in the prosecution, the entire proceedings are rendered void ab initio.

It is incumbent on the prosecuticn to prove that a va.lid sanction had been granted by the sanctioning authority after it was satisfied that a case had been made out constituting the offence. This should be done in two ways: either (i) by producing the original sanction which itself contains J' the. facts constituting the offence arid the grounds of t:tisfaction or (ii) bY adducing evidence aliunde shov,.:ing the facts placed before the authority and the sa1isfn:.:ticn arrived at by it. f1010 B-D]

In the present case no evidence, either pri1nary or secondary, had been led to rrcve the contents of the note placed bef(1re the sanctioning authority nor were the witnesses examined in a position to state the contents of the note .

2(a). The grant of sanction is not an idle formality but a solemn and sa<:rosanct act whiclz affords protection to governnzent .rer; a1u.~ aga!nsr frivolou1

prosecutions and must therefore be strictly complied with before any pr(')SCCD. tion could be launched against public servan!s. [lOIOGJ

(b) There is no force in the argument of the State that the Court should presume the facts on the basis of evidence given by one of the wittleSleS and B the onJcr implementing the sanction mentioning those factl'i.

What the Court

8-119 SC!/7J

SUPREME COURT REPORTS l 1979] 2 S.C.R.

has to see is whclher or not the sanctioning authority at the time o[ giving the sanction was aware of the facts nstituting the offence and applied its mind for the srune.

Any subsequent f3.ct coming into existence after the resolution t.ad been pat:cd is wholly irrelevant. [1010 F]

(c) 'fhcrc is equally no force in the S'::ate's contention that even if no fact& Vi'Crc mentioned in the resolution it must be presumed that the sanctioninc: authority was satisfied that the accused had received a bribe. There is no :.!iuestion vf a presumption being available to the sanctioning authority because

at that itace the occasion for drawing a presumption never arises since there is no case in the Court. flOll Bl

(d) The presumption does not arise automatically but onJy on proof of certn.in circumstances that is to say, where it is proved by evidence in Court that the money said to have been paid to the accused was actually recovered from his possession. It is only then that the Court may presume the amount received would be deemed to be an illegal gratification. The question of sanction ariies before the proceedings come to the Court and the qnestion of drawing a presumption does not arise n•t this stage. [1011 Cl

(e) The prosecution cannot be given a cince to produce any material before the court at the appellate stage to satisfy that the sanctioning authority had duly applied its mind before giving the sanction. The prosecution bad been afforded a full and complete opportunity at the trial stage to produce whatever material it liked and it had chosen to examine two witne~; but for reasons best known to it, it did not produce the note which formed the subji:-Ct rriattcr of resolution of the sanctioning authority. [1011 E.]

(f) In a criminal case this Court would not "ordinarily direct fresh evidence to fill up a lacuna deliberately left by the prosecution. The liberty of the subject v.as in jeopardy and it cannot be allowed to put in jeopardy again a1 . the instance of the prosecution which failed to avail of the opportunity aft'ordcd

to it. [lOll I']

CRIMINAL APPELLATE JURISDICTION": Criminal Appeal No. 194 of 1973.

~··

Appeal by Special Leave from the Judgment and Order dated 3-4-1973 of the Andhra Pradesh High Court in Criminal Appeal No. 703/71.

A. N. Mui/a and A. Subba Rho for the Appellant.

G. Narayana Rao for the Respondent.

Th~ Judgment of the Court was delivered by

FAzAL ALI, J.-In this appeal by special leave the appellant has been convicted under section 161 I.P.C. and section 5(2) read with section 5 ( 1 )( d) of the Prevention of Corruption Act and sentenced tO rigorous imprisonment for one year and a fine of Rs. 250/- on

each count.

• • • •

MOHD. IQBAL v. A. P. STATE (Fazal Ali, J.)

The appellant had been convicted by Special Judge but on appeal .by the State to the High Court the High Court reversed the judgment of acquittal and convicted the appellant as indicated above. According to the prosecution the appellant is said to have struck a bargain for

taking a bribe of Rs. 125/- which he received on the 15th of July, 1968 in the presence of P.Ws. 1 and 3.

On receiving the signal the raiding party appeared on the scene and the hand of the accused was dipped in water containing phenopthelien solution which showed that he touched the notes.

The defence of the appellant was that he never demanded any bribe and that the notes were thrust into his pocket. It is not necessary for us to dwell on the merits of the case because, in our opinion, the appeal must succeed on a short point of law, raised by Mr. A. N. Mulla, learned counsel for the appellant.

It was argued that the sanction under section 6 of the Prevention of Corruption Act produced in this case does not reveal the facts constituting the offence and, therefore, there is no evidence to show on what materials the sanctioning authority applied its mind and granted the sanction.

The Resolution of the Standing Committee granting the sanction is Exh. P-16 and is dated 31-3-1969, and runs as follows :

"As per note of the Commissioner, M.C.H. the Standing Committee nnanimously accords sanction for prosecution of Sri Mohd. Iqbal Ahmed (in the scale of 110-180) Section Officer of Town Planning Section (Under suspension) in a competent Court for the offence mentioned in the note of the Commissioner M.C.H., dated 18-1-1969 so as to enable the Commissioner to sign the 'prosecution order and send it to the Director, AntiCorruption Bureau for taking further action at the earliest".

A perusal of the Resolution of the Sanctioning Authority clearly shows that no facts Gil the basis of which the prosecution was to be sanctioned against the appellant are mentioned in the sanction nor does this document contain any ground on which the satisfaction of the Sanctioning Authority was based and its mind applied.

This document merely mentions that the sanction has been given on the basis of a note of the Commissioner, Mimicipal Corporation which appears to have been placed before the Committee.

It is obvious, therefore, that this note, if any, must have come into existence _either on 31-3-1969 or at any date prior to this.

The, prosecution could have proved the facts constituting the offence which were placed befor,,. the Sanctioning Authority by producing the noteat

1010 SUPREME COURT REPORl S [I '179] 2 s.c.a.

the trial.

But no such thing has been done.

What the prosecution did was merely to examine two witnesses P.Ws. 2 and 7.

P.W. 2 has produced the order implementing the Resolution of the Sanctioning Authority which is Exhibit P-10 1mc; I is dated 21st April, 1969, that is to say after the sanction was given. This document no doubt contains the facts constituting the offence but that does not solve the legal issues that arise in this case. It is incumbent on the prosecution to prove that a valid sanction has been granted by the Sanctioning Authority after it was satisfied that a case for sanction has been made out constituting the offence. This should oo done in two ways; either ( 1) by producing the original sanction which itself contains the facts constituting the offence and the grounds of satisfaction and

(2) by adducing evidence aliunde to show that the facts placed before the Sanctioning Authority and the satisfaction arrived at by it. It is well settled that any , case instituted without a proper sanction must fail because this being a manifest di!liculty in the prosecution, the entire proceedings are rendered void ab i11itio.

In the instant case no evidence has been led either primary or secondary to prove as to what were the contents of the note mentioned in Exhibit P-16 which was placed before the Sanctioning Authority.

The evidence of P.W. 2 or P.W. 7 is wholly irrelevant because they were not in a position to say as to what were the contents of the note which formed the subject matter of the sanction by the Standing Committee of the Corporation.

The note referred to above was the only primary evidence for this purpose.

Mr. Rao vehemently argued that although the Resolution, Exh. p-16 docs not mention the facts, the Court. should presume the facts on the basis of the evidence given by P.W. 2 and the order implementing sanction which mentions these facts.

This argument is wholly untenable because what the Court has to see is whether or not the Sanctioning Authority" at the time of giving sanction was aware of the facts constituting the offence and applied its mind for the same and any sub sequent fact which may come into existence after the resolution granting sanction has been passed, is wholly irrelevant.

The grant of 5anction is not an idle formality or an acritnonious exercise but a solemn and sacrosanct act which affords protection to government servants against frivolous prosecutions and must therefore be strictly complied with before any prosecution can be launched against the public servant concerned. ·

H II was next contended by Mr. Rao that in view of the presumption which is to be drawn under section 4 of the Prevention -0f Corruption Act, even if, no facts are mentioned in the Resolution of

.. 4.

~.

MOllll. IQBAi. V, A. P. STATE (Fazal Ali, J.) 1011

the Sanctioning Authority it must be pPsumed that the Sanctioning Authority was satisfied that the prosecution against the. appellant should be launched on the basis of the presump:ion that the accused had received bribe.

With due respects to the learned counsel, this argument seems to be wholly mis-conceived.

In the first plaoe, there is no question of the presumption being available to the Sanctioning Authority because at that stage the occasion for drawing a presump- 1ion nCver arises since there is no case in the Court.

Secondly, the

presu1npiicn docs not arise automatically but only on proof of cert::iri -circumstances, that is to say, where it is proved by evidence in the Court that the money said to have been paid to the accused was actually recovered from his possession, It is only then that the Court may presume the amount received would be deemed to be an illegal gratification.

So far as the question of sanction is concerned this arises before the proceedings come to the Court and the question of drawing the presumption, therefore, docs not arise at this stage.

Lastly, it was submitted by Mr. Rao that he should be given a <:hance to produce the materials before the Court to satisfy that the Sanctioning Authority had duly applied its mind to the facts constituting the offence.

We are, however, unable to accede to this prayer which has been made at a very late s:agc.

The prosecution had been afforded a full and complete opportunity at the trial stage to produce whatever material it liked and it had chosen to examine two witnesses but for reasons best known to it did not produce the note which formed the subject matter of the Resolution of the Sanc-

1 ioning Authority-Exh. P-16.

It is well settled that in a criminal case this Court or for that matter any court should not ordinarily direct fresh evidence to fill up a lacuna delibratcly left by the prosecution. The lib"rty of the subject was put in jeopardy and it cannot be allowed to put in jeopardy again at the instance of the prosecution which failed to avai] of the opportunity afforded to it

For these reasons, therefore, we are satisfied that the present prosecu•ion was launched without any valid sanction and, therefore, the cogni?an::"c taken by the Special Judge \.Vas con1pletely without juriSdiction.

The appeal is accordingly allowed.

The judgment of the High Court is set aside and convictions and sentences passed on the appellant are quashed.

The appellant will now be discharged from his bail bonds.

P.B.R.

Appeal allowed.

MOHD. IQBAL AHMAD

ST ATE OF ANDHRA PRADESH

1979 r.s. MURTAZA FAZAL ALI

A. D. KosHAL, JJ.

Prevention of Corruption Act

s. 5(2)

s. 5(1)

s. 5(2)

s. 5(1)

Prevention of Corruption Act

s. 6

A. N. Mui

A. Subba Rho

G. Narayana Rao

FAzAL ALI

section 161

I.P.C

section 5(2)

section 5

Prevention of Corruption Act

Fazal Ali

15th of July, 1968

A. N. Mulla

section 6

Prevention of Corruption Act

Mohd. Iqbal Ahmed

21st April, 1969

Rao

section 4

MOllll. IQBAi. V


MAHANT AMAR PARKASH & ORS.

PARKASHA NAND & ORS.

January 19, 1979

(R. S. SARKARIA AND 0. CHINNAPPA REDDY, JJ.J

l/indu Luw-Successio11 to Mahan! of a Dera.--lvlal!a!J.f rcsig11i11g du.1i11g ili5 life ti111e ar.d installing his successor-Notfce of 1Ytal1ant~' intention.<; to the

~; tntrt..l a.stmbly of Mahants and confirmation by it-S11cccsJor frenf(d as 'Sadaq Chela'-Validity of appointment.

In his suit for declaration that he was the Mahant of a Dera, the plaintiff

(respondent) claimed that the late Mahant who had previously executed the po, vcr of rittorncy in favour of the defendant (appellant) cancelled it and summoned the General Assen1bly of the Udasi Bhekh which was attended by other Mahants of the Udasi Bhekh and tendered his resignation on the grf'und of old age and ill hea.Jth, that the late J\fahant treated him as Sadaq Chela and that he made him a Mahant by applying Tilak and performing the Pagri ceremony at the Udtasi Bhekh. The defendant on the other hand claimed that it was he who was the chela of the late Mahant who, before his passing away executed two wills appointing him as the successor to the gaddi and that the proceedings making the plaintiff as Mahant were the result of fraud and undue influence exercised by the plaintiff over the late Mahant.

Decreeing the suit the Subordinate Judge held that neither party referred to any parti.; ular usage or custom of appointing a Mahant, that upto 1948 the E practice was for the Ruler of the erstwhile State of Nabha to appoint a Mahant, but that in this case the plaintiff was duly and validly installed as the Mahant in the presence of and with the approval of the Udasi Bhekh and that no fraud or undue influence alleged by the defendant \vas established.

The Jligh Court confirmed all the findings of the trial court.

On further appeal to this Court the defendant (appellant) contended that

(1) the late Mahant was coerced into appointing the plaintiff as his successor and (2) the appointment of plaintiff was invalid in that he \\iJs not a che1a of the late Mahan!.

Dismissing the appeal,

HEW : 1 (a) On the question whether the late Mahant was subjected to G any pressure to tappoint. the plaintiff as Mahant, both the courts have concurrently found that he was subjected to no such pressure. There is no reason for interference with a concurrent finding of fact by the h'lo courts hclow. [!017 ABJ

(b) The submission that the High. Court did not consider the complaint said to have been made by the lare Mahant that he had been coerced into appointing the plaintiff as Mahant is without basis.

The High Court did refer to the complaint.

It confirmed tiie finding of the trial court that the late Mahant who was previously under the influence of the appellant had naain come under his influence when he made the complaint. 1'he presence

'MAHA1':t Al'JAR V, PARKASHA (Chinnappa Reddy, J,) i.0.13:

of the police at the installation ceremony far from advancing the appellanfs A case, destroys the case that the Mahant acted under coercion.

[1017 C-D]

2(a) In the matter of succession to the office of Mahant the custon1 prevalent in various institutions is that in order to entitle a chela to succeed,

he must be appointed or nominated by the reigning Mahant during his life time or shortly before his death and this may be done either by a written declaration or some sort of testamentary document.

Even where a Mahant B has the po••cr to appoint his suceeBsor, it is custon1a<y in viriou~ Mutbi that such appointment should be confirmed or recognised by the members of the religious fraternity to which the late Mahant belonged. When a Mahant re.signs during his life time and installs his successor, on the gaddi the fraternity is made aware of the proposed vacancy in the office a•Jd ii given an oppo1tunity of confirming or refusing to coniirrn the nominee. [1016 _D, E, G] c t >(

}!;!. the instant case the document executed by the late Mahant on the date of the installation of the plaintiff as Mahant was attested by all the visitins Mahants of the Udasi Bhekh who assembled at the Dera .. The plaintiff was described as Srdaq Ch'ela of the late Mahant. This document showed that the late Mahant accepted the plaintiff as chela and appointed him as his

successor. (1017 E-1018 Al

(b) The Subordinate Judge found that none of the three earlier Mahants of the Dera who succeeded to the gaddi was a chela of each of bis predecessors. [1018 Bl

Maltanl Satnan1 Singh v. Bawan Bhagwart Singh, AIR 1938 PC 216; re fcrrcd to.

Mukhcrjea's Hindu Law of Religious & Charitable Trusts (Third Edition) E referred to.

, ClvIL APPELLATE JURISDICTION : Civil Appeal No. 2153 of 1969.

Appeal by Special Leave from the Judgment and Decree dated

..j 12-8·69 of the Punjab and Haryana High Court in R.FA. No. 357 F

of 1963. ·

Hmdayal Hardy, P. Ii. Parekh, C. B. Singh and M. Mudgal for the Appellants.

M. N. Phadke, Mohan Behari Lal for Respondent No. L

The Judgment of the Court was delivered by G

CHINNAPPA REDDY, J.-This appeal is directed against the judgment of the High Court of Punjab and Haryana confirming that of the Subordinate Judge 1st Class, Nabha.

The respondent plaintiff filed a suit for a declaration that he was the Mahant of Dera Baba Khiali Das, Khansura, Tehsil Nabha, District Patiala, that he H was entitled to manage the properties of the Dera and that the alienations made by Mahan! Krishan Das and Amar Parkash were not

binding on him.

It was alleged by the plaintiff that Amar Parkash who held power of attorney from Mahant Krishan Das, the previous Mahan! of the Dera, had mismanaged the properties and had granted leases of lands belonging to the Dern to his m:stress and his brother-in-law.

Mahant Krishan Das came to know about the mismanagement by Amar Parkash and cancelled the power of attorney which he had previously cxccucd in favour of Amar Parkash. Mahan!

Krishan Das summoned the general assembly of the Udasi Ghekh and held a meeting, with the help of the Deputy Commissioner, Paiiala and the Police, on 23rd July 1961.

The mcetine, was attended by other Mahants of Udasi Bhekh.

In the general assembly of the Udasi Bhekh, Mahant Krishan Das tendered resignation of office of Mahant on the ground of old age and ill health and appointed the plaintiff as his successor Mahant.

This was accep'.ed by all the Mahants of Udasi Bhekh.

Mahant Krishan Das, treating the plaintiff as his Sadaq Chela, applied Tilak, performed Pagri ceremony with his own hand and duly installed the plaintifI as the Mahant.

The visiting Mahants also performed the Pagri ceremony.

Despite the installation of the plaintiff as Mahant of the Dera, Amar Parkash continued his activitks and started obstrncting the plaintiff from discharging his obligations as Mahant.

The plaintiff, therefore, filed the suit for a declaration that he was the Mahant of the Dera and for other reliefs.

The defendant Amar Parkash raised the pica that he was the chela of Muhant Krishun Das and that Mahant Krishan Das who died on 30th December, 1961, had executed two Wills on 17th July, 1955 and 24th September, 1961, appointing him as the Mahan! to succeed him. It was alleged that the proceedings which took place on 23rd July 1961 were the result of fraud and undue influence exercised over Mahan! Krishan Das.

On the plead in gs of the parties the primary question which aros; o for consideration was whether the plaintiff was validly appointed as Mahan! of Dcra Buba Khiali Das.

The learned Subordinate Judge, Nabha framed two principal issues.

Issue No. 1 was :

"What was the particular custom or usage prevailing in the Dera in dispute for the appointment of a Mahan! on the relevant date ?"

Jue No. I-A was :

"whether the plaintiff was ;"alidly appointed the Mahant of the Dera in accordance with the prevalent custom ?"

The learned Subordinate Judge noticed that neither party pleaded or

referred to any particular usage or custom for appointing a Mahant ·~

._i..

MAHAlff AMAR v. PARKASHA (Chimiappa Reddy, J.) 1015

for the disputed Dern.

He also noticed that the documentary evidence showed that the final appointment of Mahants for Deras in the Nabba State Was required to be approved by the Ruler of the State.

Leaving the matter there, the learned Subordinate Judge found that the plaintiff was duly and validly installed as Mahant of the Dern by Mahant Krishan Das in the presence of and with the approval of Udasi Bhekh.

He held that the plea of fraud and undue influence raised by the deicndant was not established.

On those findings the suit Was decreed.

The first defendant Amar Parkash preferred an appeal to the High Court of Punjab and Haryana.

During the pendency of the appeal the plaintiff sought an amendment of the plaint in order to enable him to expressly plead the particular custom relating to succession to the office of the Mahant of Dera Baba Khiali Das.

The amendment was allowed and the High Court directed the Subordinate Judge to record additional evidence and submit a report giving his finding on the question whether the custom pleaded by the plain•ifl' was established and if so, whther the plaif!tiff was appointed in accordance with such custom.

After recording additional evidence the learned Subordinate Judge submitted a report to the effect that the custom al1eged by the plaintiff was not established and that upto 1948 the practice was for the Ruler of Nabha State to appoint the Mahan!.

After receiving the report of the learned Subordinate Judge,. the High Court heard the appeal.

It was conceded by the learned Counsel for the appellant before the High Court that in view of the report of the learned Subordinate Judge, the appeal should be decided on the basis of the evidence adduced before the Trial Court prior to the order of the High Court calling for a report from the Trial Court.

On that basis the learned Counsel for the appellant attacked the finding on issue No. 1-A only and did not assail the findings on the other issues.

The High Court confirmed the finding of the Trial Court that there was no undue influence exercised over Mahant Krishan Das and that the plaintiff was validly appointed and installed as Mahant of the Dera.

In the first instance Shri Hardayal Hardy, learned Counsel for G the appellant invited us to explore the evidence and the case 'law to find out the custom relating to succession to the office of Mahant of Deras in Nabha State in general and Dera Baba Khiali Das in particular.

Ultimately, however, he conceded that if the plaintiff was shown to have been validly appointed and installed as Mahant by iate Mahant Krishan Das at the ceremony held on 23rd July 1961, ff the plaintiff was entitled to succeed.

He argued that late Mahan!

Krishan Das was covered into appointing and installing the plaintiff

as Mahant and therefore, the appointment of the plaintiff as Maha.at of the Dera. was invalid.

He also argued that the plaintiff wa11 nol a chela of Mahan! Krishan Das and, therefore, he could not have boen validly appointed as Mahant of the Dera in question.

As pointed out in Mukhe1jea's Hindu Law of Religious and Charitable Trusts (Third Edition), sucoession to the office of Mahan! is a matter of some complexity and the custom varies greatly from institution to institution.

Generally speaking, it is pointed out, Mutts may be divided into three classes : Mourasi, Panchayati and Hakimi. "In the first, the office of the Mohunt is hereditary and devolves upon the chief disciple of the existing Mohunt who moreover usually nominates him as his successor; in the second, the office is electi•e, the presiding Mohunt being selected by an assembly of Mohunt11. In the third, the appointment of the presiding Mohunt is vested in the ruling power or in the party who has endowed the temple". It is also said "In various institutions the custom is that in order to entitle a chela to succeed, he must be appointed or nominated by the reigning Mohunt during his life time or shortly before his death and this may be done either by a written declaration or some sort of testamentary document". It is further said "Even where the Mohunt has the power to appoint his successor, it is customary in various Mutts that such appointment should be confirmed or recognised by the members of the religious fraternity to whicli the deceased belonged".

In Mahant Satnam Singh v. Bawan Bhagwan Singh('). the Privy Council while noticing that succession to the office of Mahant was to be regulated by the particular custom of the Math, observed as follows : "In the normal case of the death of a Mahan!, the members of the fraternity will be fully aware of the vacancy in the office, and the usual practice will be for the installation of his successor usually nominated by him, to take, place on the seventeenth day after the death.

On the other hand, when the Mahan! resigns during his life and installs his successor on the gaddi, it is obvious that the fraternity should be made aware of lhe proposed vacancy in the office and should be given the opportunity of confirming or refusing to confirm the nominee". It is unnecessary for us to make any further investigation into the custom relating to the appointment of Mahan! since, in the light of the submissions made before us, two questions alone arise for consideration namely whether Mahant Krishan Das was coerced into appointing tl1e plaintiff as his successor Mahant and whether the appointmel!t of the plaintiff was inv'.1\ict on the ground llf his not being a Chela of Mahant Krishan Das.

(l) A.l.R. 1938 P.C. 216.

MAHANT AMAR v. PARKASHA (Chinnappa Reddy, J.)

I 017

On the question whether late Mahant Krishan Das was subjected to any pressure to appoint the plaintiff as Mahan!, both the Courts below have concurrently found that he was subjected to no such pressure.

The finding is one of fact and we are unable to see any :round justifying our interference with a concurrent finding of fact.

Shri Hardyal Hardy submitted that the High Court failed to consider the complaint said to have been made by late Mahant Krishan Das a few days after the installation of the plaintiff as Mahant in which he stated that he had been coerced into appointing the plaintiff as Mahant. Shri Hardyal Hardy also submitted that the evidence showed that the ervices of the Police had been requisitioned to pressurise late Mahan! Krishan Das.

The submission that the High Court did not consider the complaint said to have been made by late Mahan!

Krishan Das is without basis since we find that the High Court did refer to the complaint. The High Court confirmed the finding of the Trial Court that late Mahant Krishan Das who was previously under the influence of Amar Parkash had again come under the influence of Amar Parkash when he made the complaint.

With regard to the presence of the Police at the installation ceremony we are of the view that the presence of the police, at the ceremony, far from advancing the appellant's case, destroys the case that Mahant Krishan Das acted under coercion.

The question that remains for consideration is whether the plaintiff was the Chela of Mahant Krishan Das and whether he could be validly appointed, if he was not the Chela.

In Exhibit P-7 dated 23rd July 1961 which was executed by Mahant Krishan Das and attested by all visiting Mahants the plaintiff Parkasha Nand was described as 'Sadaq Chela' of Mahant Krishan Das.

The ceremony which took place on 23rd July 1961 was described by Parkasha Nand in the following words :

"The congregation sat on the durries on the first floor of the Dera. About 25 Mahants and about 30 villagers sat on those durries. Mahant Krishan Das offered a Tilak on my forehead.

Mahan! Bikram Dass collected turbans from the Mahants who were present there and tied five turbans on my head. Mahant Som Parkash offered me a Doshala and sugar-cakes were distributed.

All these proceedings were gone through with the free and voluntary consent of late Mahant Krishan Das and no pressure was brought to bear on him.

Mahant Krishan Das was not confined.

Exhibits P6 to PS were written at that time and the people who

1018 SuPREME COURT REPORTS

[ 1979) 2 S.C.R.

were present had affixed their signatures and thumbimpressions thereon''.

We are satisfied that late Mahant Krishan Das accepted the plaintiff as his Chela and appointed him as his successor Mahan!.

We may also mention here that the learned Subordinate Judge in his report B mentioned that Pandit Bhagtanand who was previously a Mahant of the Dern was not a Chela of his predecessor Mahan! Sunder Das and that Mahan! Krishan Das himself was not a Chc:la of his predecessor Mahan! Bhagtanand.

We arc unable to see any ground for inteference and the appeal is c accordingly dismissed with costs.

N.V.K.

Appeal dismissed.

MAHANT AMAR PARKASH & ORS

PARKASHA NAND & ORS

January 19, 1979

January 19, 1979

(R. S. SARKARIA AND 0.

R. S. SARKARIA

0. CHINNAPPA REDDY, JJ

Udasi Bhekh

Mahant

Nabha

Al'JAR V, PARKASHA

Chinnappa Reddy

Mukhcrjea

Hmdayal Hardy

C. B. Singh

M. Mudgal

M. N. Phadke

Mohan Behari Lal

G

CHINNAPPA REDDY

High Court of Punjab and Haryana

Mahan! Krishan Das

Amar Parkash

Amar Parkash

Mahant Krishan Das

Amar Parkash. Mahan

Krishan Das

Paiiala

23rd July 1961

Mahant Krishan Das

Muhant Krishun Das

Dcra Buba Khiali Das

Subordinate Judge, Nabha

Chimiappa Reddy

Mahants

Nabha State

Hardayal Hardy

Dera Baba Khiali Das

Mahan

Hardyal Hardy

Parkasha Nand

Parkasha Nand

Bikram Dass

Mahant Som Parkash

Pandit Bhagtanand

Mahan! Sunder Das

Mahan! Bhagtanand

N.V.K.


LlNGARI OBULAMMA

v •

L. VENKATA REDDY & ORS .

.Tan1tary 19, 1979

.[S. MURTAZA FAZAL ALI AND A. D. KOSllAL, JJ.J

1(119

Penal l'ode-S. 494-Scope of-Essential co11ditio11s to be Sl1tiJfied for application of the section.

1 he appellant waK the husbaJ!d of respondent No. 1. Relations between the husband and wife ht; wing been strained for some years they lived separately.

On the husband's complaint that his wife had married another person during the subsistence of their n1arriage, she and accused no. 4 were convicted under s. 494 !PC.

Allowing the wife's revision petition the High Court held the marriage to ¥ be void on lhe ground that there was no evidence to prove that the essential ceremonies required to be performed in a Hindu marriage, namely Dutta Homa and Saptapa<li had been performed.

In apptal to this Court the husband contended that under the custom followed by the community to which the parties belonged Saptapadi was not

an essential requiren1ent to constitute a valid rr11..1rrriage but that tying a yarn thread round th~ bride's neck at the time of marrirge wi.; s sufficient to make a va1id n1arriage Und this having been done, the second marriage was va1id and the wife \Vas guilty of the offence under s. 494 lPC.

Dismissing the appeal.

HELD : The prosecution failed to prove that the second n1arriage was a valid marriage and, therefore, the High Court was justified in tacquitting the respondents. [1022 F]

Before a conviction can be recorded under s. 494 IPC the following ingre~ clients must be satisfied :-

(1) that the cornplainant had been married to the accused;

(2) that the accused contracted a socond marri~.ge while the first marriage was still subsisting; and

(3) that both the marriages were va1id and strictly according to law governing the parties. [1022 BJ

In the instant case th'ere wa& no evidence to show that there was any custom among the parties out weighing the .written text of Jaw.

Secondly, the husband had not clearly mentioned that the parties were governed by custom m erogation of Hindu Law. The priest who performed the marriage bd shO\vn co1nplete ignorance as tO whether or not the parties were governed by custom. The witness was, therefore, incompetent to depcse about the exist cnce of any custom in the family of the parties.

When the priest said that there .was no custom of .sacred fire and Saptapadi what he meant MlS that in the econd inarriage these two coremonies had not he.en performed. [102·2 CD &:

IQ21 0-HJ

•I0.20

SUPREME COURT REPORTS

[1979] 2 S.C. R.

A £11 rr: (Jo/go111i Ragliava Reddy & Anr., AIR 1968 (AP) 117 held inapplicable.

CRIMINAL APPELLATE JUR!Sl)JCT!ON : Criminal Appeal No. 339 of 1975.

Appeal by Special Leave from the Judgment and Order dated 19-3-1975 of the Andhra Pradesh High Court in Criminal Revision Case No. 16/74 (Criminal Revision Petition No. 12/74).

P. Parmeshwara Rao, T. V. S. N. Chari and R. Nagarathn11111 for the Appellant. ·

A. V. V. Nair for the Respondent.

The Judgment of the Court was delivered by

FAZAL ALI, J.

This appeal by special leave has been filed by lhe complainant against the order of the Andhra Pradesh High Court acquitting the respondents, who had been convicted by the trial court Magistrate and the Sessions Judge under Section 494 I. P. C. {!nd sentenced to six months rigorous imprisonment and a fine of Rs. 100/- as modified by the Sessions Judge.

The appellant had filed a complaint against the respondent No. 1 on the ground that he was her husband and while the first marriage was subsisting he had contracted a second marriage and was, therefore, guilty of the offence of bigamy as enshrined in Section 494 of

.I. P. C.

According to the prosecution the first marriage of respondent No. 1 with appellant took place on 22-4-68.

After about 3 years of the first marriage the relations between the husband and wife became strained and they separated, but there was no divorce.

On 1-4-1972 the respondent No. 1 married accused No. 4 and the other accused who were relations of the respondent participated in the marriage.

On knowing this fact the appellant filed a complaint on 26-4-1972 on the basis of which the respondents were prosecuted and ultimately convicted under Section 494 of J. P. C.

The case went up in revision to the High Court which accepted the revision and acquitted the accused on the ground that there. was no proof of a. valid marriage having been contracted between accused No. 4 and accused No. 1.

Against this order the appellant filed a petition for special leave and after obtaining special leave, the appeal has beeri placed before us for hearing.

Tbe short point involved in this appeal is as to whether or not the second marriage contracted by respondent No. 1 (A-l) with respondent No. 4(A-4) was a legally valid marriage.

The High Court pointe-0 out that under the Hindu Law, two essential ceremonies of ·

UNGAR! OBULAMMA v. VENKATA REDDY (fazal Ali, J.) 102;1

a valid marriage arc Datta Homa and Saptapadi i.e. taking seven

stqis around the sacred fire.

The High Court found that there. was absolutely no evidence to prove that any of these two essential ceremonies had been performed, and, therefore, the marriage was void in the eye of law.

In this view of the matter the High Conrt held that the conviction under Section 494 I. P. C. could not be sustained .

In support of the appeal Mr. Rao has submitted that the High Court has taken a wrong view of law and has overlooked the fact that in the instant case, the parties belonged to the Reddy Community and were therefore governed by custom and under the custom the

two ceremonies mentioned by the High Court were not necessary at G all to constitute a valid marriage.

The other ceremonies which were necessary under the custom had been performed according to Purohit

(P.W.l).

Unfortunately, however, in the state of evidence in the present case it is impossible for us to hold that the second marriage . was a valid one.

In the first place it has not been clearly mentioned 0 in the complaint as to whether the parties were governed by custom in derogation of Hindu Law.

Secondly, P.W. l stated thus :-

"Among Kapus, according to their customs each community will perform the marriage. Some Kapus have only 'Yarn Thread' instead of Mangala Sutram.

I do not know what is the custom (Acharam) of the accused.

There was no custom of putting sacred fire.

There was no 'Agni Gundam' (Sacred fire and no going round 7 times by the bride and bridegroom).

I do not know whether that is true Of a secret marriage'_'.

It would appear from the aforesaid statement of P.W. 1 that he had clearly stated that he does not know what is the custom of the accused.

Ha, ving shown complete ignorance of the fact as to whether or not the accused was governed by custom the witness goes on to state that there was no custom of sacred fire and Saptapadi.

What the witness really means is that in the second marriage which was contracted by respondent No. 1, these two ceremonies were not performed by him. Mr. Rao, however, vehemently contended that this witness proves that in the Reddy Community the custom of Saptapadi was not prevalent and it was sufficient to put the 'Yam Thread' instead of Mangal Sutril'. In our opinion when witness has frankly admitted that he does not know the custom of the accused he was incompetent to depose about the existence of any custom in the family

1022 SUPREMl!COURTRl!PORTS l.19'79J 2 S.C; R.

. A of the accused.

It is well settled that before a conviction can be recorded under section 494 the following ingredients must be proved :-

( 1) That the complainant had been married to the accused ;

(2) That the accused contracted a second marriage while the first marriage was still subsisting ;

( 3) That both the marriges were valid and strictly according to law governing the parties.

In the instant case there was no evidence to show that tl1ere was any custom amongst the Reddys which, outweighed the written text of law. The evidence of P. W. 1, clearly falls short of the standard to prove this fact.

Mr. Rao, however, strongly relied on a decision of the Andhra Pradesh High Court in some other case to show that among the Reddy Community oE Telangana area the two ceremonies mentioned above were not necessary.

In the first place the decision referred to above in the ca•e of re: Dolgonti Raghava Reddy and Another(') clearly shows that the Court in that case was concerned only with the Reddy Community of Telangana alone.

The trial cour: has pointed out in its judgment that so far as accused is concerned he belongs to the Reddy Community not of Tclangana area, but that of Rayalaseema area.

In these circumstances the Judgment of the High Court cannot be of any avail to the appellant.

Moreover, as the existence of the custom was neither mentioned in the complaint nor proved in the evidence it would be difficult for this Court to rely on the decision of the High Court which was based on the evidence, facts and circumstances of the case before it.

In these circum11tances we agree with the High Court that the prosecution bad failed to prove that the second marriage contracted by respondent No. 1 with respondent No. 4 was a valid marriage and, therefore, the High Court was fully justified in acquitting the respondents.

The UP.peal is without any substance and is accordingly dismissed.

P.B.R.

Appeal dismissed.

(I) A.I.R. 1968 A.P. 117

I I.

LlNGARI OBULAMMA

L. VENKATA REDDY & ORS

S. MURTAZA FAZAL ALI

S. 494

s. 494

s. 494

s. 494

IPC

Saptapadi

P. Parmeshwara Rao

T. V. S. N. Chari

R. Nagarathn11111

A. V. V. Nair

FAZAL ALI

Andhra Pradesh High Court

Section 494

Section 494

Section 494

fazal Ali

Section 494

Rao

Purohit

section 494

Dolgonti Raghava Reddy

Telangana

Tclangana

Rayalaseema


GUJARAT STATE COOPERATIVE LAND DEVELOPMENT

BANK LTD. .

P. R. MANDED AND ORS.

January 23, 1979

[R. S. SARKARIA AND 0. CHJNNAPPA REDDY, JJ.J

New piea, entertainments of-Not permissible at the appellate level.

Bombay Co-op<rative Sociea,. Act, 1925, (Bombay Act Vll of 1925) Section 54 and Section 96 of the Gujarat Co-operative Societies Act, 1961...:....

Scope of the words "any dispute touching the business of the society" Bombay Industrial Relations Act, 1946 (Bombay Act 11 of 1947) Section 2(4) notification under, read with s. 166(1) of the Gujarat Co-operative Societies Act,

1961, effect of.

Theappellant Bank was a. society registered under the Bombay Co-operative Societies Act, 1925 and with the coming into force ftom May 1, 1962 of the Gujtairat Co-operative Societies Act, 1961, it came to be governed by

the said Act.

By Notification No. BIR-1362·5H dated March 2, 1963, the Government of Gujarat directed under s. 2(4) of the Bombay Industrial Rela".' D lions Act, 1946 (Bombay Act 11 of 1947) that ell the provisions of the said Act shall apply with effect from March 15, 1963 to the business of banking

by Ccroperative Banks in the Saurashtra and Kutch areas of the State, regis~ tered and deemed to be registered under the Gujarat Co-operativ'e Societies, Act, 1961.

The second respondent, Babu Bhai Negracha who was working as am E additional supervisor in the Dasada Branch of the appellant Bank and whose se:r:vices were terminated by an order dated February 21, 1962, by giving him

one month's pay in lieu of notice under Staff RegQ]ation No. 15, filed an applic:ition in the Utbour Court Rajkot, alleging that his services had been illegally and maliciously terminated as an act of victimisation on account of ,.ilr-- his trade union activities and praying for setting aside the -order of his termina tion of service and for reinstatement with full back wages.

The Labour Court by its order dated June 11, 1963, overruled the preli mi nary objection raised by the appellant Bank, namely, that "the Bombay Industrial Relations Act, 1946 Under which the application Was made by the respondent was not applicable to its ca:se, as it was a co.operative society

goVerned by the Gujarat Co-operative Societies Act, unde'r which only the Reg5trar or his nominee had jurisdiction to decide the dispute, and the Labour G Court had no jurisdiction to entertain and decide the application".

The appellant Bank's writ petition challenging the said order of the Labour Court OOs dismissed by the Gujarat High Court by its judgment dated August 25, 1967 .

Dismissing the appeal by certificate, the Court

HELD : 1. No new plea can be raised for the first time in the Supreme Court, as a matter of right. In the instant case, the new plea that • 1the appellant is not doing banking business" \V3S not enterta.ined for the reasons

9-119SCIJ79

___ ,__

A namely (i)-it was much too belated; (ii) it stood in direct contradiction to the position taken by the appellant in i~ \\'Tit petition and the affidavit in support thereof in the High Court wherein it had been clearly admitted tb:i.t "the society i~ engaged 'in the business of banking" and (iii) it was not a purely legal _plea but a mixed plea of law and fact and could not be detern1incd on the basis of material already on the record. [1027 F-01

1. 1be e.xpression "any dispute'' referred to in Section 54 of the Bombav

Cooperative Societies Act, 1925 and in Section 96 of the Gujarat Cooperativ~ Societies Act, does not cover a dispute of the kind raised by respondent 2 .;1gainst the appellant-bank. [1034 C]

(a) It is clea.r from the object and the schcn1e of th'e AcL'i of 1925 anil J.961 that the legis-laiurc never intended lo give such a wide scope to the 'expression "any dispute" so as to cover u classes of disputes whatever be their nature a11 the prefix "any" to "dispute" appears to give.

The tern1 "dispute" means a controversy ha.ving both positive and negati\e aspects.

Jt postulates the .assertion of a claim by one party and its denial by the other.

[1031 C-Dl

(b) The expression "any dispute"' has not been defined in the Acts of 1925 and 1961.

This expression has been used in a narrower scn.'ie limited t.J confested claims of a civil nature, which could have been decided by civil or revenue courts, but for the provisioru with regard to compulsory arbitration by the Registrar or hi9' nominee foimd in Section 54 of the Bombay Act of i925 and in Section 96 of the Gujarat Act. 1961.

The words ·"as if th; dispute were a suit and the R'egistrar as Civil Court" occurring in sub-6ection

(t} of Section 97 of the Gujarat Act, nlso make this poition clear. [1031 C, D.

E, G]

(c) The compulsory arbitration by the Registrar on rcfercni..--c under s. 96 is only a substitute for adjudication of disputes of a civil nature normally tri'ed by the Civil Court. It is incumbent, under sub-section (2) of s. 96 of the 1961 Act, on the Registrar to decide as a preliminary issue, whethef the dispute is of a kind under sub-section ( t) of s. 96 falling within his jurisdiction.

Tf thi9 peJirninary issue is found in the negative he will hav'e no further jurisdiction to deal with the matter. [1031 F, G-1032 Fl

(d) Thus considered, a dispute raised against the Society by its discharged se:rvant daiming reliefs, such as, reinstatcrnnt in service with back wages, which are not enforceable in a civil court, is outside the scope of the expre8sion "touching the management of the Society" userl ins. 96(1) of the Act of 1961, ant1 the Re:gistra-r has not jurisdiction to deal \vith and determine it. What has been directly bidden "out-of-bounds'' for the Registmor. by the very scheme and object of the Act, cannot be directly inducted by widening the connotation cf

'management'. Such a dispute squarely fa1ls within the jurisdiction of the l .abour Ct'urt under the Bombay Industrial Relations Act. [1036 E-G]

3. The law of Tndu9'tria1 disputes or Industrial Relations is a special law dealing With rights and obligations specially created by it.

The provisions in s. 54 of the Bomba.y Act and in s. 96 of the Gujarat Act being: general provisions ii, :1ccordance with the maxim gl'11c1 alia spcciafi/Jus non dfro{!ant. nothing in these general provisions can Jerogatc from Bombay Industrial Relation!! Act, -and itbe Cooperative Societies .A.ct must yield to the i;:pecial provi-

.f >

I J

'C00P.ERA1U¥£ :SANK v. P. R. MANDl?D 1025

"Soions in the Bombay :Industrial Rclalions Act, whcn'ever a. dispute clearly

A . .comes within the .language of the latter Act. Section 166(1) of the Gujarat Act, in terms, bars the jurisdiction only of Civil or Revenue Court, and not of the Labour Court or any Industrial 'Tribunal constituted under the. Bombay Industrial Relations Act or Industrial Disputes Act. The legislature never inte:"lded to oust the jurisdiction of the Labour Court or the Industrial Tribunal to determine claims and industrial dispute5 which cannot be adjudicated by

the 01dinaiy Civil Court. [1032 H, 1033 A, 1034 A-BJ B

In the instant case :

(a) The Labour Court is con1petent to grant the relief of reinstat.ement while in view of s. 21(b) of the Specific Relief Act, then in force, the Civil .Court was not competent to grant that relief. If a Court is incapable of granting the relief claimed, normally the :; roper construction \Vl!ltld be thnt C jf is incornpttent to deal \vith the n1attcr. [.1033 F, H]

(b) The dispute was raised by the second respondent by writing an approach k:Uer to his employee, the appeUnnt, as required by the Bom'f?ay Industrial Relations Act. Jn substance, it was no industrial dispute. It was .not reshicted to a daim under the contract or ngn.:'cn1cnt of (.; ffiployn1ent. 1_1033

F-G]

(c) The rights and reliefs claimed by the scOO\ld respondent could not be , determined and granted by a Civil Court in a suit. lfis allegation was that his crvices vie-re terminated unfairly and vind.ictlvcly bccau$el of his legitimate 1rade union activities, s an act of victimisation. The relief claimed is rein.statemep.t in services \Vith back wages.

The rights claimed are those which .are conferred on workmen and employees under the Bombay Industrial Re1a- tions Act to ensure social justice.

Such rights which do not stem from the .contra-:t of employment can be enforced only in the Labour Court constitukd .under B, l.R. Act. [1033 B-FJ

Jullundur Transport Cooperath1e Sacieties Ltd. v. Punjab State, AIR 1959 "Puo. 34; approved.

Rohtos Industries Ltd. v. Brij1w11do11 Pandey, [1956] SCR 800; referred to.

(d) Neither the Registrar nor his nominee will be competent to grant the relief of requiring change in the1 service cOndtions of the employee.

Such a relief could be granted by the JndustriaJ Tribunal \Vhich under the .Industrial Disputes Act, has the jurisdiction even to vary contracts of service bctl';'ecn .:in employer and c_rnpJoyees. (1037 C-DJ

Co-operative Central Rnnk .Ltd. v. Additional Industrial Tribunal, Hydera- .bnd [1970] I SCR 205; applied.

Farkhundali 'J:i.lnunhay v. V. R. Potdar, AIR 1962 Born. 362 overruied.

CrvrL ;'\PPEU.ATE Ju1usmcnoN : Civil Appeal No. 236 of 1969.

Appeal from the Judgment and Order dated 24/25th August 1967 , of the Gujarat High Court in SCA No. 585/63.

S. K. Dholnkia and R. C. 'Rhatia for th' Appellant.

P. Ram Reddy, Amicus Curiae for Respondent No. 2.

The Judgment of the Court was delivered by

SARKARIA, J.

The appellant is the Gujarat Sfate Cooperative Land ' Development Bank Ltd. (hereafter referred to as "the Bank). It is a Society registered under the Bombay Cooperative Societies Act, 1925, B B£ applicable to the erstwhile State of Saurashtra.

According to the appellant's writ petition, it is doing banking business. It has 127 Branches spread 1!11 over the State of Gujarat.

One of its Branches is in Dasada, Surendranagar District.

The Head Office of the Bank is at Ahmedabad.

C The second respondent, Babu Bhai Negracha, was serving as an. . ~- Additional Supervisor in the Dasada Branch of the Bank.

His services were terminated by an order, dated February 2r, t962, by giving him

one month's pay in lieu of notice under Staff Regulation No. 15.

The Gujarat Cooperative Societies Act, 1961, came into force from D May 1, 1962, and the appellant-Bank, being a Society, under the Cooperative Societies Act, came to be governed by the said Act.

By Notification No. BIR-1362-5-H, dated March 2, 1963, pub- J1shed in the Gujarat Gazette in March 1963, the Government of Gujarat directed under Section 2 ( 4) of the Bombay Industrial Relations Act, 1946 (Bombay Act 11 of 1947) that all the provisions ot the said Act shall apply with cifoct from March 15, 1963 to the• business of banking by Cooperative Banks in the Saurashtra and Kutcn -, reas of the State, registered and deemed to be registered under the Gujarat Cooperative Societies Act, 1961. ' Aggrieved by the termination of his service, the second respqndent approached the appellant's Dasada's Branch by a letter, dated August 20, 1962, stating that since his services were terminated illegally by way of victimisation, he should be reinstated in the service.

Thereafter, the second respondent filed an application in the Labour Court at Rajkot, alleging that his service had been illegally and maliciously terminated as an act of victimisation on account of his trade union activities. He prayed for setting aside the order of his termination of service and for reinstatement with full back wages.

The Bank filed a written statement, raising a preliminary objection that the Bombay Industrial Relations Act, 1946, under which the H application was made by the respondent, was not applicable to its. case as it was a Cooperative Society governed by the Gujarat Coope:ative Societies Act, under which only the Registrar or his nominee•

had jurisdiction to decide the dispute, and the Labour Court had no jurisdiction to entertain and decide the applica\ion of the second respondent.

By its Order, dated June 11, 1963, the Labour Court overruled .this objection and held that it had jurisdiction to hear the application.

The Bank then filed a writ petition under Article 226 of \be Con- 'Stitution in the High Court to challenge the Order of the Labour Court. The High Court by a common judgment dated August 25, 1967 dismissed the writ petition, but in view of the importance of the question of law involved, granted a certificate of fitness for appeal to

; this Court.

.On the strength of that certificate, the Bank has come in appe~ 'before us against the aforesaid judgment of the High Court.

In this Court on January 22, 1969, the Bank made an application for leave to urge as additional ground, namely, that the Bank is not D doing banking business, i.e. accepting for the purpose of lending or investment of deposits of money from the public, repayable on demand or otherwise, and withdrawable by cheque, draft, order or otherwise as .defined in Section 5, Clauses (b) and (c) of the Banking Companies Act, 1949; and that this being the true position, the Notification No.

DIR-1362-IV-H dated March 2, 1963, published in the Gujarat Gov- E emment Gazette dated March 7, 1963, under Section 2(4) of the Bombay Industrial Relations Act, 1946 (Bombay Act XI of 1947) is not applicable to the appellant.

This application was strenuously opposed by Shri Ram Reddy, who is assisting the Court as amicus curia{; on behalf of respondent 2, who has not been able to appear and defend ; himself in this appeal.

We have declined permission to raise this new plea for the first time in this Court, for these reasons : (i) It is much too belated; (ii) It stands in clirect contradiction to the position taken by the appellant in its writ petition and the affidavit in support thereof filed in the High Court.

Therein, the appellant had categorically pleaded : "The petitioner is a Society registered under the Bombay Cooperative .Societies Act, 1925 (Bombay Act VII of 1925) ..... . and is engaged

in the business of banking." (iii) It is not a purely legal plea but a mixed plea of .law and fact, and cannot be determined on the basis , of material already on the record.

We, therefore, take it that the appellant is a Cooperative Society , engaged .in Jlw J>y§iness of banking and, as such, the Bombay Industrial

'.~,

- -

A Reations Act,_ 1946 is applicable to it by virtue of th~ aforesaid Notification dated March 2, J 963, issued by the State G<}vernment uii<ler Section 2 ( 4) of that Act.

The arunients of Mr. Dholakia, appearing for the appellant, may be summansed as follows :

(i) The case is governed by the Gujarat Cooperative Societicc, Act, l 961 (hereafter called the Act of 1961) and not by the Bombay Cooperative Societies Act, 1925 (hereafter referred to as the Act of 1925).

(ii) The phrase "any dispute touching ...... the businci; s of the Society", particularly the word "touching'' the.rein, is of very \vid~ amplitude. It would comprehend any matter which relates to, or concerns or affects the business of the Society. Every society, ex-necessitiate employs SOillle servants for the purpose of carrying on its business.

That being so, the payment of wages, appointment and removal of its , servants under law is a part of the business or "touches" the business D of, the Society. (Reliance for this argument bas been placed on

Farkhundali Naunhay v. V. B. Potdar (').

(iii) Even if contention (ii) is not accepted, the dispute raised by the respondent, Babu Bhai Negracha is one "touching th~ managen1ent of the society''.

The expression 'management' takes in the entire ' ' ' staff or establishment of servants which run the affairs of tl1c Society.

(iv) Once it is held that the dispute between the Society and its past servant, Babu Bhai Negracha, touches the "business" or the "management" of the Society, or both, within the meaning of Sectiofr 96, the Registrar or his nominee, alone, shall have jurisdiction to p adjudicate such dispute by compulsory arbitration; and the non-obstante clanse in the Section shall bar the determination of that dispute hv <' Industrial Tribunal or the Labour Court under the Bombay Industrial Relations Act.

As against the above, Mr. Rama Reddy, amicus rnriae, submitted as under:

(i) Since the se.rvices of the second respondent were terminated on February 21, 1962, before the Act of 1961 came into force, the Act relevant for" this discussion is the Act of 1925.

(ii) Irrespective of whether the Act of 1925 or the Act of 1961 governs the appellant-Society, the expression "any dispute" commonly occurring in Section 54 of the Act of 1925 and Section 96 of the'.

(I) AJ.R. 1962 Born. 162.

r"'"•

Act of 1961, is restricted in its scope to a dispute of a, civil nature which is capable of being resolved by the Registrar or his nominee, and does not take in an industrial dispute between the Society and its workmen which under the B.l.R. Act is triable by the Labour Court/Industrial Tribunals, only.

(iii) B.I.R. Act is a special law, dealing with the special subject of industrial disputes, which in their nature arc essentially different from ordinary Civil disputes between an employer and his employee governed by the Law of Contract, , B.I.R. Act provides for a special machinery for adjudication of industrial disputes.

As against this, the Cooperative Societies Act of 1925/or of 1961 is a general enactment and it must yield to the B.IR. Act whenever the provisions of the latter by their language are clearly applicable to a dispute.

Reference has been made to Jul/undur Transport Cooperative Society

Ud. v. Punjab State(').

(iv) The scope of the expression "any dispute touching the business of the Society", occurring in Section 54 of the Act of 1925/or Section 96 of the Act of 1961 is limited to disputes directly relatillg to the actual trading or commercial activities of the Society.

This expression does not take in a dispute between the Society and its employee relating to. tl1e conditions of his employment, which will include the termination of his employment.

This point is concluded by the decision of this Court in Cooperative Central Bank Ltd. v.

A dditic>nul Industrial Tribunal, Hyderabad('), which follows the ratio of its earlier decision in Deccan Merchants Cooperative Bank Ltd. v.

J)alichand lungraj Jain(').

In view of these decisions, the ratio of Farkhundali's case (ibid) decided by the Bombay High Court, is no longer good law.

( v) The expression "management" in Section 96 oE the Act of 1961, means "the Board of Directors", or "the Board of Trustee~". or the "Managing Committee" or "'Executive Bcxiy'' which. has the overall control of the affairs and business of the Society, and it does not include the individual workers or employees, individual workmen , or employees of the Society who carry on the day-to-day administra•

tion of the Society; nor will it take in matters touching the service conditions of tl1e servants of the Society such as their appointment to service or their discharge, removal from service and their wag~.

A dispute of the kind raised by the second . respondent, therefore,

(I) A.I.R. 1959 Punj. 34.

(2) [1970] 1 S.C.R. 205.

(3) [1969] l S.C.R. 885.

It. will not fall within the purview of the phrase "any dispute touching the management of the Society'' used in Section 96.

Before appreciating the contentions canvassed on both sides, it is necessary to notice the relevant provisions of the Act of 1925 and • the Act of 1961.

The relevant part of Section 54 of the Act of 1925, reads thus :

"(1) (a) If any dispute touching the constitution or business of Society arises between members or past members of the Society or persons claimir g through a member or a past member or between members or past members or persons so claiming and any o; ffice.r, agent or servant of the Society or its Committee, and any officer, agent, member or servant of the Society past or present, it shall be referred to the Registrar for decision by himself or his nominee ...... "

The corresponding Section 96 of the Act of 1961 lays down : D "(1) Notwithstanding anything contained in any other

law for the time' being in force, any dispute touching the constitution, management or business of a Society shall be referred in e prescribed form . . . . if the parties thereto are from amongst the follo\\ng :-

(a) a Society, its Committee, any past Committee, any past or present officer, any past or present agent, any past or present servant or nominee, hci.r or legal representative of any deceased officer, deceased agenl:

or deceased servant of the Society, or the Liquidatoc of the Society .... "

A comparison between the portions of the two Sections, extracted above, brings out two points of difference.

Firstly, in Sectioa 54, there is no non-<Jbstante clause, while Section 96( 1) begins with the words "Notwithstanding anything contaiped in any other law for the time being in force".

Secondly, while in Section 54, the word 'management' does not occur, in the corresponding Section 96(1) of the. 1961 Act, the word 'management' has been inserted in-between the words 'constitution' and 'business'.

It is significant to note that the phrase "any dispute touching the constitution. . . . or business of the Society" is a common feature of both the aforesaid Sections. We emphasise this fact, because it is thls common feature, rather than the points of difference between the two Sections, that holds the key to a correct solution of the problem before us.

.i..

From a conspectus of the decisions cited at. the Bar, we may devise two broad tests to determine the points in controversy in the instant case: First, whether the expression "any dispute" spoken of in Section 54 of the Act of 1925, and Section 96 of the Act of 1961, is one which is capable of being resolved by the Registrar or his nonrinee under the relevant Cooperative Societies Act ? Second, whe- ther a dispute raised by a servant against his employer, the Cooperative Society, for setting aside his removal from service on the ground that it was an act of victinrisation and for reinstatement in service with back wages, is one "touching the management or business of the Society" within the contemplation of the said provisions ?

As regards the first test, it is to be noted that the expression "any dispute" has not been defined in the Acts of 1925 and 1961.

The term "dispute" means a controversy having both positive and negative aspects.

It postulates the assertion of a claim by one party ana itS denial by the other.

The word "any" prefixed to "dispute" may at first glance, appear to give the expression "any dispute" a very wide amplitude covering all classes of disputes, whatever be their nature.

But the context of these provisions, the object and scheme of the Acts of 1925/1961 show that the Legislatures never intended to give such a wide scope to this expression. The related provisions and tlie scheme of the Acts unerringly indicate that the expression. "any dispute" has been used in a narrower sense limited to contested claims of a civil nature, which could have been decided by civil or revenue courts, but

for the provisions with regard to compulsory arbitration by the Registrar or his nominee, found in Section 54 of the Act of 1925 /96 of the Act Of 1961. The 'first indication of this being the right construction, is discernible in sub-section (2) of Section 96 which states that when , any question arises whether for the purposes of sub-section (1) a matter referred to for decision is a dispute or not, the question sha1! \be considered by the Registrar, whose decision shall be final.

This means, it is incumbent on the Registrar to decide as a prelinrinary issue, whether the dispute is of a kind under sub-section ( 1) of Section 96 falling within his jurisdiction. Ji this preliminary issue is found in the negative, he will have no further jurisdiction to deal with the matter.

A further clue to the interpretation of "any dispute" used in 'Section 96(1) is available in Section 97(1) which prescribes periods of linritation for disputes of the kind specified in its clauses (a) and (b), referred to the Registrar under Section 96.

Sub-section (2) of 'Section 97 which is in the nature of a residuary provision, states that the period of limitation in the case of any dispute other than those mentioned in sub-section (1) which are required to be referred to the

Registrar under Section 96, shall be regulated by the provisions of the lndian Limitation Act, "as if the dispute were a suit, and the Registrar as Civil Court". The last clause M sub-section (2) which has been underlined, unmistakably shows that only disputes of a civil nature which could be the subject of civil suits triable by ordinary civil courts, will fall within the scope of the expression "any dispute" used in Section 96 (1 l- '

Another definite pointer to the above being the right construction ~

of "any dispute" is available in sub-section (3) of Section 98 which provides: _ ).

"Notwithstanding anything contained in Section 96, the Registrar may, if he thinks fit. suspend proceedings in regard to any dispute, if the question at issue between a society and a clain1ant or between different claimants 1 is one irivolving complicated question of Jaw or fact, until the question has been tried by a regular suit instituted by one of the parties or by the society. If any such suil is not instituted within two

months from the Registrar's order suspending proceedings,. the Registrar shall take action as is provided in sub-section

(1) ."

It is 110teworthy that this sub-section is substantially in the sam<:· Etem1s as the proviso to sub-section ( 1) of Section 54 of the Act of J 925, extracted earlier.

The proviso to sub-section (I) of Section 54 of the Act of 1925 corresponding to sub-section (3) of Section 98 of the Act of 1961,. unmistakably shows that the compulsory arbitration by the Registr&r, on a reference under Section 96. is only a substitute for adjudicatiouof disputes of a civil nature normally tried by civil courts.

Further indication regarding the nature of disputes which the Registrar may determine, is furnished by Selion 166(1) which pro-·

vides:

"166(1). Bar of jurisdiction of Courts : Save as expressly provided in this Act, no Civil or Revenue Court shall have any jurisdiction in respect of-

(a)

(b) any dispute required to be referred to the Registrar, or his norrUnee, or board of nominees, for decision."

It will be seen that Section 166, in terms, bars the jurisdiction only of Civil or Revenue Court, and 1101 of the Labour Court or any

Industrial Tribunal constituted under the B.I.R. Act or Industrial Disputes Act to adjudicate industrial disputes. It is clear that the Legislature never intended to oust the jurisdiction of the Labour Court or the Industrial Tribunal to determine claims and industr.ial disputes which cannot be adjudicated by the ordinary Civil Courts.

Now. let us turn to the nature of the dispute raised by the second respondent.

Is it a dispute relating to a right which he could establish by filing a suit in a Civil Court? -assuming for the moment that nothing in the relevant Cooperative Societies Act is a bar to such a• suit.

The answer must be in the negative.

The respondent is not claiming a civil right arising from the contract of employment with the appellant-Bank.

What he is claiming is not enforcement of any term of the contract of his employment on the part of his employer.

He is alleging that his services have been ter111inated unfairly and vindictively becansc of his legitimate trade union activities, as an act of victimisation.

The relief claimed by him is of rcinstarement in service with back wages.

The rights and reliefs which he is claiming could not be determined and granted by a Civil Court in a suit.

As Luding Teller puts it,. "a Court of Law proceeds on the footing that I no power exists in the Courts to make contracts for people and the parties must make their own contracts.

The Courts reach their limit of power when they enforce contracts which the parties had made."

(Quoted with approval in Rohtas Industries Ltd. v.

Brijnandan Pandey.(') The rights claimed by the second respondent are those which are conferred on workmen and employees under the Bombay Industrial Relations Act, to ensure social justice.

Such rights which do not stem froni the contract of employment can be enforced only in the Labour Court constituted under the B.J.R. Act.

The Labour Court is competent to grant the relief o[ reinstatement claimed by the respondent, while in view of Section 21 (b) of the Specific Relief AQ.,

then in force, the Civil Court was not competent to grant that relief.

The dispute was raised by the second respondent by writing an approach letter to his employer, the appellant, as required by the Bombay Industrial Relations Act.

In substance, it was an industrial dispute. It was not restricted to a claim under the contract or agreement of employment.

The Civil Court cannot grant the reliefs claimed by the second respondent.

As rightly submitted by Mr. Rama Reddy, if a Court is incapable of granting the relief claimed, normally, the proper construction would be that it is incompetent to deal with the matter.

(I) [19561 S.C..R. 800.

The matter can be looked at from another angle, also.

The law of industrial disputes or industrial relations is a special law dealing with rights and obligations specially created by it.

As against this, the provision in Section 54 of the Act of 1925/Section 96 of the Act of 196.1 is a general provision.

In accordance with the maxim generalia specialibus non derogant, therefore, nothing in these general provisions can derogate from B.I.R. Act and the Cooperative Society 6ct must yield to the special provisions in the Bombay Industrial Relations Act, whenever a dispute clearly comes within the language • of the latter Act.

In the light of the above discussion, the conclusion is inescapable that the expression "any dispute" referred to in Section 54 of the 1925 Act/Section 96 of the 1961 Act, does not cover a dispute of the kind raised by respondent 2 against the appellant-Bank.

Coming now to the second test, it may be observed that to a part of it, the pronouncement of this Court in Cooperative Central Bank Ltd. v. Additional Industrial Tribunal, Hyderabad (ibid), furnishes a complete ariswer, wherein the interpretation of this very phrase "touching° the business of the - Society" occurring in Section 61 of Andhra Pradesh Cooperative Societies Act, 1964, which largely corresponds to Section 96 of the Gujarat Act, 1961, came up for interpretation.

The subject-matter of the dispute was divided into three issues.

The first issue comprised a number of service conditions including inter alla salary, scales and adjustment or dearne.s allowance, conveyance charges, provident fund and grataity, etc.

It was contended on behalf of the Bank that the effect of Section 61 and other provisions of Andhra Pradesh Cooperative Societies Act was to exclude the jurisdiction of the Industrial Tribunal to deal with such disputes under the Industrial Disputes Act.

After noticing a number of decisions and after referring to the previous decision of this Court in Deccan Cooperative Bank, tl1c Court negatived the contention with these observations:

"The dispute related to alteration of a number of conditions of service of the workmeri which relief could only be granted by an Industrial Tribunal dealing with an industrial dispute.

The Registrar, it is clear from the provisions of the Act, could not possibly have granted the reliefs claimed nnder this issue because of the limitations placed on his powers in the Act itself. . . .

The word "business" is

uated with the actaal trading or commercial or other

ii:

similar business activity of the society, and since it has been held that it would be difficult to subscribe to the proposition that whatever the society does or is necessarily required to do for the purpose of carrying out its objects, such as laying down the conditions of service of its employee, can be said to be a part of its business, it would appear that a dispute relating to conditions of service of the workmen employed by the society cannot be held to be a dispute touching the business of the society ..... Thus it is clear that in respect of the dispute regarding the alteration of various conditions of service, . the Registrar or other person dealing with it under Section 62 of the Act is not competent to grant the relief claimed by the workmen at all.

On the principle laid down by this Court in the case of the Deccan Merchants Cooperative Bank Ltd., Civil Appeal No.· 358 of 1967 dated 29-8-68, AIR 1969 SC 1320 (supra) therefore, it must be held that this dispute is not a dispute covered by the provisions of Section 61 of the Act.

Such a dispute is not contemplated to be dealt with under Section 62 of the Act and must therefore, be held to be outside the scope of Section 61."

The observations quoted above, negate contention (ii) advanced by Mr. Dholakia.

It however, remains to be considered whether the dispute raised by the second respondent in the present case, comes within the purview of the expression "touching the management of the Society" used in Section 96(c) of the Act of 1961. ·

In this connection, it may be noticed that just as in Section 96(1), in Section 61 of the Andhra Pradesh Corporation Societies' Act, 1964, also, which came up for consideration in Cooperative

Central Banks' case before this Court, the term management does occur in the collocation of words "constitution, management or business". But no specific argument seems to have been then raised that a dispute between the Society and its former servants relating to the conditions of service, comes within the purview of the expression 'touching the management of the Society'.

Perhaps, it was taken for granted that if the dispute was not comprehended by the expression "business of the Society", it would not be covered by the words "management of the Society'', either.

Although there is little discussion in the jdgment about the ambit and import of the expression "management", yet in conclusion, it was clearly and emphatically held

-A that the dispute in that case was "outside the scope of SectioJl 61."

We will now, focus attention on the expression "n1anagement of the Society" used in Section 96(1) of the Act of 1961.

Grammatically, one meaning of the term 'management' is: 'the Board of Directors' or 'the apex body' or Executive Committee at the helm which guides, regulates, supervises, directs and controls the affair.s of the Society'. fo this sense, it may not include the individnals who under the over-all control of that governing body or Cominittee, run the dayto-day business of the Society. (see Words and phrases, by West Publishing Co. Permanent Edition, Vol. 26, page 357, citing, Warner & Swasey Co. v. Rusterholz D. C. Minn.('). Another meaning of the

t\:rm 'management', may be: 'U1e act or acts of managing or governing by direction, guidance, superintendence, regulation and control the affairs of a Society.'

A still wider meaning of the term which will encompass the entire staff of. servants and workmen of the Society, has been canvass_ed for by Mr. Dholakia. The use of the term 'management' in such a wide sense In Section 96 ( l) appears to us, to be very doubtful.

Be that as it may, what has been directly bidden "out-of-bounds"

for the Registrar by lh0 very scheme and object of the Act, can.not be indirectly inducted by widening the connotation of 'management'. A construction free from contexual constraints, having the effect of smuggling into the circumscribed limits of the expression "any dispute", a dispute which from its very nature is incapable of being resolved by the Registrar, has to be eschewed.

Thus considered, a dispute raised against the Society by its discharged servant claiming . , reliefs, such , as reinstatement in service with back wages, which are -, not enforceable in a Civil Court, is outside the scope of the expression "touching th~ management. of the Society" used .in Section 960) .of ._.. the Act of 1961, and the Registrar has no .iurisdiction to deal with

and determine it.

Such a dispute squarely falls within the jurisdiction of the Labour Court under tl1e .BJ.R. Act. .

Learned counsel for the appellant tried to argue as a last resqrt that the relief sought by the second respondent could be granted ~'r/.Y )he Registrar by relaxing or moulding the StaffRgulations and By, e7)aws which lay down conditions of scryicc governing the cmploycs , of_, thc

Society. It is pointed , out that.under the Act of 1961. the Jlegistrar .has the power. \o amend or modify .such Regulations .and Bye-la,),'l'S.

'(1)41 F. Supp. 398, 505.

Wr;. find no merit in this contention, also.

A similar argument was advanced before tbis Court in Coopera- . tire Central Bank's Case; ibid, and was repelled inter alia, with the reasoning that the bye-laws of the Bank, containing the conditions of service were in the nature of a contract between the Bank and its . employees and a change of such bye-Jaws, embodying the conditions of employ111c11t, "could not possibly be directed by the Registrar where, under s. 62 (4) of the (ANDHRA) Act, be is specifically required to decide the dispute referred to him iu accordance with the provisions of the bye-laws". It was further observed that a dispute. referred to the Registrar can even be transferred for disposal to a person who may have been invested with powers iu that behalf, or may be referred for disposal to an arbitrator. But neither the Registrar nor bis nominee will be competent to grant the relief requiring a change in the service conditions of the employees, under section 62 of the Andhra Act. Such a relief could be granted only by the Industrial Tribunal which under the Industrial Disputes Act, has the jurisdiction even to vary contracts of service between au employer and employees. This reasoning is applicable mutatis mutandis to the instant case.

For all the foregoing reasons, the appeal fails and is dismissed with costs. Ju token of our gratitude for the valuable assistance

rendered to us by Shri Rama Reddy as amicus curiae, we direct that E an honorarium of Rs. 1500/- be paid to him, which shall be taxed as costs awarded against the appellant.

V.D.K.

Appeal dismissed.

P. R. MANDED AND ORS

January 23, 1979

January 23, 1979

[R. S. SARKARIA AND 0.

R. S. SARKARIA

0. CHJNNAPPA REDDY, JJ

Section 54

Section 96

Bombay Industrial Relations Act, 1946

Section 2(4)

s. 166(1)

Gujarat Co-operative Societies Act

Bombay Co-operative Societies Act, 1925

Government of Gujarat

s. 2(4)

Utbour Court Rajkot

June 11, 1963

Bombay Industrial Relations Act, 1946

Gujarat High Court

August 25, 1967

Supreme Court

Section 54

Cooperative Societies Act, 1925

Section 96

Section 54

Section 96

Section 97

s. 96

s. 96

s. 96

s. 54

s. 96

Industrial Rclalions Act

Section 166(1)

s. 21(b)

Specific Relief Act

Industrial Relations Act

Industrial Disputes Act

S. K. Dholnkia

R. C. 'Rhatia

P. Ram Reddy

SARKARIA

Gujarat

Dasada

Surendranagar District

February 2r, t962

Gujarat Cooperative Societies Act, 1961

March 2, 1963

Section 2

Bombay Industrial Relations Act, 1946

March 15, 1963

Saurashtra

Gujarat Cooperative Societies Act, 1961

August 20, 1962

Labour Court at Rajkot

Bombay Industrial Relations Act, 1946

Article 226

January 22, 1969

Section 5

Banking Companies Act, 1949

March 7, 1963

Section 2(4)

Bombay Industrial Relations Act, 1946

Bombay Act XI of 1947

Ram Reddy

Societies Act, 1925

Bombay Act VII of 1925

Section 2

Dholakia

Bombay Cooperative Societies Act, 1925

Babu Bhai Negracha

Rama Reddy

Section 54

Section 96

Section 54

Section 96

Farkhundali

Bombay High Court

Section 96

[1970] 1 S.C.R. 205

Section 96

Section 54

Section 96

Section 96( 1)

Section 54

Section 96(1)

Section 54

Section 96

Section 54

Section 96

Section 96

Section 96(1)

Section 97(1)

Section 96

Section 97

Section 96

Limitation Act

Section 96

Section 98

Section 96

Section 54

Section 54

Section 98

Section 96

Section 166

Act or Industrial Disputes Act

Cooperative Societies Act

Luding Teller

Section 21

Rama Reddy

Section 54

Section 96

Section 54

Section 96

Section 61

Section 96

Gujarat Act, 1961

Section 61

Industrial Disputes Act

Deccan Cooperative Bank

Section 62

Deccan Merchants Cooperative Bank Ltd.

AIR 1969 SC 1320

Section 61

Section 62

Section 61

Section 96(c)

Section 96(1)

Section 61

Cooperative

Central Banks

Section 96(1)

Section 96

Section 960

s. 62

section 62

Industrial Disputes Act

V.D.K.