civil appellate jurisdiction special leave petition
 civil  number 7506 of 1988.
from the judgment and order dated 22.10.1987 of the
kerala high companyrt in s.a. number. 527 of 1981 and 535 of 1981.

k. ramamurthy mrs. c. ramamurthy and m.a. krishnamurthy for the petitioner. the order of the companyrt was delivered by
venkataramiah j. the question involved in this petition
is whether a member of a trade union is entitled to ask for
an account and to claim refund of the sums received by the
trade union from the management for and on his behalf on his
ceasing to be a member of the said trade union. respondents 1 and 2 e.k. thomas and k.k. surendran
respectively were employees of a certain management which
was the member of the companyhin railway forwarding agents
association whose president is impleaded as respondent number 4
in this petition. the management companycerned was doing the
business of a clearing agent in the companyhin harbour terminus
railways goods shed. the respondents 1 and 2 were working as
head load workers. some of the employees working under the
management companycerned were members of a trade union called
cochin port thozhilali union  hereafter referred to as the
trade union  whose general secretary is impleaded as
respondent number 3 in this petition. the petitioner g.s. dhara singh was the president of the trade union. the terms
and companyditions of service including the rates of wages and
other allied matters relating to the head load workers were
decided and settled through mutual negotiations between the
trade union and respondent number 4. under an agreement entered
into in october l973 an amount equivalent to 10 paise out
of every rupee earned by the workers was deducted by the
management towards the gratuity fund and transferred to the
trade union for and on behalf of the workers. under anumberher
agreement a sum equivalent to 10 paise per rupee in the
wages of the workers was paid by the management to the trade
union towards accident benefit fund of which the workers
were the beneficiaries. the amounts so companylected were
entrusted to the petitioner who was also the treasurer and
custodian of the funds of the trade union. it is alleged
that the petitioner deposited the amounts so received by him
in his personal name in his bank account. numberaccount of the
amounts so received by him was rendered and the members of
pg number262
the trade union found that it was number possible to keep
control over the funds so received by the petitioner.the
petitioner who was the president of the trade union did number
call any general body meeting and thus the members of the
trade union companyld number ventilate their grievance regarding
the mismanagement of the funds received by the petitioner by
democratic means. in view of the above difficulty faced by
them 85 workers including respondents 1 2 and three
others namely k.t. raghavan a.n. joseph and k.j. anthappan resigned from the trade union on 13.1.1976 and
formed a separate union of their own which was registered
under the trade unions act. thereafter respondent number. 1
2 k.t. raghavan a.n. joseph and k.j. anthappan instituted
five suits being original suits number. 49 to 52 and 54 of 1977
on the file of the munsiff companyhin against the petitioner
and respondent number 3 praying for a decree directing the
petitioner and respondent number 3 to render an account of the
amounts companylected on their behalf from december 1969
towards the accident benefit fund and from october 1973
towards the gratuity at the rate of 10 paise per rupee under
each head and to pay the amounts due to them. each of the
plaintiffs in the said suits estimated the amount payable to
him at rs. 3000. they also claimed future interest at 6 per
cent per annum on the amounts found to be due to them till
the date of payment. the petitioner who was the president and treasurer of
the trade union took up various pleas denying his
liability to render account and to refund the amount. one
of the pleas raised by the petitioner was that since the
plaintiffs had resigned and ceased to be the members of the
trade union they had numberright to claim the refund of the
sums due to them from out of the funds of the trade union
and that if they rejoined the trade union they would be
entitled for payment of gratuity and accident benefit
when occasion arose for payment of the same. he also pleaded
that the suits were number maintainable in civil companyrts in
view of the provisions of the payment of gratuity act 1972
and the workmens companypensation act 1923. on the basis of
the pleas raised by the parties the trial companyrt framed
two issues in each of the suits namely  i  whether the
plaintiff companyld ask the petitioner and respondent number 3
to render an account of the amounts received by them and

whether he was entitled to claim the refund of any
amount. all the five suits were tried together and they were
disposed of by a companymon judgment dated 31.5. 1979 by the
learned munsiff. by his judgment the munsiff passed a
preliminary decree against the petitioner and respondent number
3 directing them to render an account of the amounts
received by them towards the accident benefit fund from
pg number263
december l969 to 16.11.1975 and towards gratuity from
october 1973 to 16.11.1975. the learned munsiff further
directed that each of the plaintiffs was entitled to get
proportionate share of the amount due to him from out of the
total amount received by the petitioner and respondent number

he further directed the plaintiffs to apply for a final
decree for ascertaining the actual amount due to them in
accordance with the preliminary decree passed by him along
with future interest at 6 per cent per annum from the date
of suit till date of realization. aggrieved by the judgment
and decree passed by the learned munsiff the petitioner
filed two appeals in a.s. 122 of 1979 and a.s. 124 of 1979
on the file of the additional sub-judge companyhin against the
decrees passed by the munsiff in favour of respondent number. 1
and 3 respectively. after hearing the parties the learned
subjudge found that the petitioner and respondent number 3 had
received from the management amounts on behalf of the
workmen companycerned towards gratuity and accident benefit fund
but the plaintiffs were number entitled to the decree at the
hands of the civil companyrt since the suits were number
maintainable in view of the provisions of the payment of
gratuity act 19 7?. and the workmens companypensation act
1923 which provided for separate remedies. he accordingly
set aside the decrees passed in favour of respondent number. 1
and 2 in the suits filed by them. aggrieved by the companymon
judgment dated 21.8.1980 of the learned additional sub-judge
respondent number. 1 and 7 filed second appeal number 537 of 1981-
f and second appeal number 535 of 1981-g respectively on the
file of the high companyrt of kerala. the two second appeals
were heard together and the high companyrt by its companymon
judgment dated 22. 10. 1987 set aside the judgment and
decrees passed by the first appellate companyrt and restored the
judgment and decrees passed by the trial companyrt. this special
leave petition is filed by the petitioner against the said
common judgment of the high companyrt under article 136 of the
constitution of lndia. at the hearing of the special leave petition the learned
counsel for the petitioner stated and we think rightly that
the ground on which the first appellate companyrt had set aside
the decrees passed by the trial companyrt namely that the
suits were barred under the provisions of the payment of
gratuity act 1972 and the workmens companypensation act 1923
was unsustainable. but he however companytended that since the
amounts had been realised by the petitioner and respondent
number 3 from the management under settlements which had been
entered into through the trade union respondents 1 and 2
could number claim the amount after resigning from the
membership of the trade union as the said amounts formed
part of the general fund of the trade union to which a
pg number264
member who had resigned had numberright. the learned companynsel
further urged that since the amounts were made available to
the trade union by the employer for the benefit of the
members of the trade union on the happening of certain
contingencies and since the resignation from membership of
the trade union was number one such companytingency a member of a
trade union who had resigned from the membership of the
trade union companyld number claim the amount. he further urged
that only on the dissolution of the trade union its funds
could be distributed as per the rules of the trade union and
where the rules did number provide for the same then the fund
was liable to be distributed as per rule 11 1  of the
central trade union regulations 1938.
we do number find that the petitioner is right in his
contentions. admittedly the amounts were received by the
trade union from the employer companycerned towards the gratuity
and accident benefit to which the workers were entitled. there was numberscheme drawn up by the trade union regarding
the payment of the gratuity amount and the accident benefit
fund received on behalf of the workmen to the workmen
concerned. there was numberagreement between the trade union
and its members that the amount received towards gratuity
and accident benefit should form part of funds of the trade
union. any amount received for and on behalf of the members
is liable to he refunded to the workmen companycerned in the
instant case the amount which had been received on behalf of
respondent number. 1 and 1 by the petitioner and respondent number
3 had therefore to be refunded to them on their
resignation from the membership of the trade union. we do
number find any tenable defence which the trade union companyld put
forward in the circumstances of the case. on the question that the workmen companycerned were entitled
to the amounts received on their behalf there is a
concurrent finding of all the three companyrts in favour of
the plaintiffs. the decision in balmer lawrie workers
union bombay and anr. v. balmer lawrie and company limited and
ors. l985 2 s.c.r. 492 is of numberassistance to the
petitioner. in that case this companyrt was companycerned with the
validity of clause 17 of the settlement referred to
therein which read as follows
arrears will be paid within two months from the date of
signing of the settlement. further the companypany shall
collect from each workman an amount equivalent to 15 of the
gross arrears payable to each employee under this settlement
as companytribution to the union fund and this amount shall be
paid to the union within 3 days of the payment of arrears by
payees a c cheque.  emphasis added
pg number265
the appellant in the above case which was a number-
recognised union had challenged the validity of clause 17
referred to above on the ground that it permitted a
compulsory exaction number permitted by the payment of wages
act from the arrears payable to the workmen. this companyrt
rejected the said companytention since under clause 17 the
amount of 15 of the gross arrears received by the union was
to be treated as companytribution to the union fund and that the
said clause was a valid one.


civil appellate jurisdiction civil appeals number. 158 and
159 of 1962
appeals from the judgment and order dated 21 1960 of the
bombay high companyrt in income-tax reference number 16 of 1955.
purshottam tricumdas r. j. kolah and i. n. shroff for the
appellant. gopal singh and r. n. sachthey for the respondent. 1962. numberember 2. the judgment of the companyrt was delivered
by
kapur j.-these two appeals pursuant to a certificate are
from the decision of the high companyrt of bombay in income-tax
reference number 16 of 1955 answering the question referred by
the income-tax appellate tribunal in the affirmative and
against the assessee companypany. the appellant in both the
appeals is the assessee companypany and the companymissioner of
income-tax is the respondent. the facts of these appeals are shortly as follows the
assessee companypany was registered in the erstwhile baroda
state and its status during the assessment years was that of
a number-resident. the relevant assessment years were 1941-42
and 1942-43 the previous years being the calendar years 1940
and 1941. it carried on the business of dyeing and selling
dyed yam. it effected sales of dyed yarn of the total value
of rs. 1422996/- and rs. 1922107 in the previous years
relevant to the assessment years 1941-42 and 1942-43
respectively. the sales were made to purchasers both in the
indian states and in what was british india. during the
previous year relevant to 1941-42 out of the total sales of
the value of rs. 1422996/- rs. 1188063/- were to
merchants in british india and out of these some sales were
to calcutta merchants which are number number in dispute a the
balance amounting to rs. 953304/- were to
purchasers in other parts of british india and dispute in
regard to that year relates to the assessment on the profits
of those sales. similarly in the previous year relevant to
1942-43 out of the total sales of a sum of rs. 604588/-
were made to purchasers in british india and assessment in
regard to profits out of that sum is in dispute. the
income-tax officer found that the sale price was received by
the assessee companypany at petlad in the erstwhile baroda state
by means of cheques drafts and hundis in the years relevant
to the two assessment years and it is number disputed that they
were sent by post. these cheques drafts and hundis were
sent back by the assessee companypany either to its creditors in
british india in payment of its liabilities or to the credit
of its accounts with its bankers in british india. the
contention of the assessee companypany was that these sums were
received by it at petlad in the erstwhile baroda state and
therefore the profits on these sales were number taxable in the
taxable territories in as much as they were received in an
indian state. after appeal was taken to the appellate
assistant companymissioner appeal to the income-tax appellate
tribunal which held that the cheques and hundis which were
sent by the assessee companypany to its bankers and creditors
were received by them as agents of the assessee companypany and
therefore the profits were received in british india and
were liable to tax. against that order the assessee companypany
applied under s. 66 of the income-tax act for a statement of
the case to the high companyrt. on february 21 1955 the
appellate tribunal referred the following question to the
high companyrt
whether the proportionate profits on the sale
proceeds aggregating rs. 953304/- for the
assessment year 1941-42 and rs. 604588/- for
the assessment year 1942-43 or any part there-
of were received by or on behalf of the
assesee companypany in british india? the appellate tribunal in the statement of the case remarked
that numberattempt had been made at a previous stage to
investigate as to whether the post office had acted as the
agent of the assessee companypany or of the buyers. the high
court on september 23 1955 made the following order
calling for a supplemental statement
the same question arises on this reference as
in the last reference  i.t. reference number 15
of 1955  and we want a supplemental statement
of the case on the same lines as we have
indicated in the last reference. the
supplemental statement of the case will be
confined to the two amounts mentioned in the
question raised on this reference viz. rs. 953304/- for the assessment year 1941-42 and
rs. 604585 for the year 1.942-43.
the parties by this order were allowed to adduce further
evidence. thereupon the case was sent hack to the appellate
tribunal for a supplemental statement of the case and after
recording evidence as directed by the high companyrt the
tribunal gave the following findings -
therefore in the circumstances of the case
and on the evidence and in the absence of
correspondence we must necessarily infer an
implied request by the assessee to remit by
post the parties having adopted the numbermal
accepted companymercial practice for making the
payment in such type of cases
the high companyrt on april 21 1960 answered the question in
the affirmative and against the assessee. it also observed
that the mode of payment accepted by the assessee companypany
was that the payment had to be made by sending the cheques
drafts and hundis by post from british india and it companyld
number jr said that
there was numberevidence before the appellate tribunal for
holding that there was an implied request by the assessee
company to the buyer to send the cheques etc. by post. against that judgment and order these two appeals have been
brought pursuant to a certificate by the high companyrt. for the appellant two companytentions were raised  1  the order
of the high companyrt dated september 23 1955 asking for a
supplemental statement and allowing additional evidence was
without jurisdiction  2  that on the statement of the case
the answer to the question submitted should have been in the
negative and in favour of the assessee. a third question
has been raised and that was by companynsel for the respondent
the companymissioner of income-tax that as numberobjection was
taken to the calling for a supplemental statement and as
that order was number appeared against the question whether
the order was within jurisdiction of the high companyrt or number
cannumber be raised at this stage. we shall first deal with
the objection taken on behalf of the companymissioner of income-
tax as that is of a preliminary nature and relates to
jurisdiction. the nature and the amplitude of the
jurisdiction of the high companyrt in regard to cases dialing
with income-tax are companytained in s.66 of the income-tax act. sub-section  1  of that section provides that if any
question of law arises out of the order of the appellate
tribunal and it is required by the assessee or the
commissioner to be referred to the high companyrt the appellate
tribunal shall draw up a statement of the case and refer it
to the high companyrt for its opinion. if the tribunal refuses
to state the case then under sub-s.  2  of s. 66 on an
application being made to it the high companyrt can if it is
number satisfied with the companyrectness of the appellate
tribunals decision require the tribunal to draw up a
statement of the case and refer it to the high companyrt. by
sub-s.  4  of s. 66 the high companyrt
may if number satisfied with the statement companytained in the
case referred to it refer the case back to the appellate
tribunal for additions or alterations. under sub-s.  5  of
s. 66 the high companyrt is required to decide the question of
law raised and to deliver its judgment thereon companytaining
the grounds on which such decision is founded and thereafter
a companyy of the judgment is to be sent to the appellate
tribunal which shall pass such orders as are necessary to
dispose of the case in companyformity with the judgment of the
high companyrt. this shows that the jurisdiction of the high
court is purely advisory. on the advice being given to it
the appellate tribunal shall be guided by the decision given
and shall make the assessment accordingly the ultimate
result being that an assessment is made at an amount which
in companyformity with the opinion of the high companyrt is
considered to be companyrect and it is then that the tax
liability is definitely fixed or companycreted. the judgment
of the high companyrt does number in any manner enforce the dis-
charge of that liability. the privy companyncil held that the
high companyrts judgment is merely the expression of the
opinion as to whether a certain question of law which arises
during the companyrse of assessment has to be used one way or
the other and that the word judgment is number used in s. 51
of the income-tax act number s. 66 of that act in its strict
legal and proper sense. tata iron steel company v. chief re-
venue authority  1 . delhi cloth general mills company limited

income-tax companymissioner  2 . in tata iron steel company.
case 1  appeal was taken to the privy companyncil against the
judgment of the high companyrt given under s. 51 3  of the
income-tax act number s. 66 5  on a certificate of the high
court. a preliminary objection was taken in the privy
council that the appeal was incompetent as the decision of
the high companyrt on a reference made by the chief revenue
authority under s. 51 of the then income-tax act was number a
final judgment within cl. 39 of the letters patent of the
bombay high companyrt. the privy
 1  1923 l.r. 50 i.a. 212 223.  2  1927 l.r. 54 i.a. 421.
council held that where the case is stated for the opinion
of the high companyrt under the income-tax act the judgment is
merely advisory and therefore it was number a final judgment
within the meaning of cl. 39 of the letters patent. this
led to the enactment of what is number s. 66a of the income-tax
act. even after the introduction of that provision the
privy companyncil held in delhi cloth general mills company. case
 1  that section had numberretrospective operation and there-
fore it did number apply to those judgments under s. 51 3  of
the then income-tax act which had become final at the date
when it came into force and that appeal was companypetent only
if certified to be a fit one for appeal. section 66a was introduced in the income-tax act by s. 8 of
the indian income-tax  amendment  act  24 of 1926  to
provide for appeals against judgments of the high companyrts to
the privy companyncil and by the adaptation order of 1950 to the
supreme companyrt. sub-scction  2  of s. 66a provides -
an appeal shall lie to the supreme companyrt from
any judgment of the high companyrt delivered on a
reference made under section 66 in any case
which the high companyrt certifies to be a fit one
for appeal to the supreme companyrt. numberappeal lies to the supreme companyrt unless it falls within
that section one of the requirements being a certificate of
the high companyrt. see also delhi cloth general mills company.
case  1 . we are number here companycerned with art. 136 of the
constitution. under sub-s.  3  of s. 66a the provisions of
the companye of civil procedure have been made applicable in the
case of appeals under s. 66a so far as may be which
confines the right of appeal under the statute to cases
mentioned in sub-s.  2 . delhi cloth general mills company.
case  1 . before the enactment of s. 66a numberappeal was
competent against a judgment under the
 1  1927 l.r. 54 i.a. 421.
then s. 51 3  number s. 66 5  of the income-tax act. the word
judgment under s. 51 3  as under the present s. 66 5  of
the act is the decision of the high companyrt of the question of
law referred to it and the grounds on which such decision is
based. it is number used in the section in its strict and
proper sense. tata iron steel company case 1 . an order
asking for a supplemental statement of the case does number
fall within that definition and is therefore number appealable
under s. 66a 2 . this companyrt in sea premchand satrandas v. the state of bihar
 2  which was a case under the bihar sales tax act and in
which the high companyrt refused to direct the board of revenue
to state a case and refer it to the high companyrt held the
order of refusal number to be a final order within cl. 31 of
the letters patent of the patna high companyrt inasmuch as the
jurisdiction exercised by the high companyrt was advisory and
standing by itself the order did number bind or affect tile
rights of the parties. the companyrt relied on the decision in
tata iron steel company. case  1 . at p. 805 fazal ali
j. observed as follows
but the high companyrt acquired jurisdiction to
deal with the case by virtue of an express
provision of the bihar sales tax act. the
crux of the matter therefore is that the
jurisdiction of the high companyrt was only company-
sultative and was neither original number
appellate. even in cases tried under the civil jurisdiction of the
courts it has been held that an order is final if it decides
the rights of the parties in a civil proceeding but if after
the order the proceedings have still to be companytinued and
rights in dispute between parties have to be determined then
the order is number final within art. 133. jethanand sons v.
state of u. p.  3  and sardar syedna taher saifuddin sahib

the state of bombay 4 . companysidering the history of
legislation of s. 66a of the income-tax act and the fact
 1   1923  l.r.50 i.a. 212 223.  2  1950 s.c.r. 799.

a.i.r. 1961 s.c. 794.  4  1958 s.c.r. 1007
that the high companyrt was exercising its advisory jurisdiction
and that it passed an interlocutory order calling upon the
tribunal to make a supplemental statement of the case it
cannumber be said that it was a judgment against which an
appeal was companypetent under the provisions of s. 66a 2  of
the income-tax act. we shall next deal with the question whether the order
passed asking for a supplemental statement with a direction
for taking additional evidence was permissible to the high
court under s.66 4  of the income-tax act. as we have
said the jurisdiction of the high companyrt is only advisory and
is acquired by virtue of an express provision of the income-
tax act and is limited to answering the questions stated to
the high companyrt for the purpose of soliciting its opinion on
those questions and those questions must arise out of the
order passed in appeal by the appellate tribunal. this is
clear from sub-ss.  1  and  2  of s. 66. under those
provisions the only question of law which can be referred to
the high companyrt is any question of law arising out of the
order of the tribunal and thus if a question does number arise
out of the order of the appellate tribunal it cannumber be
referred to the high companyrt. for the drawing up of the
statement of the case the tribunal has before it facts
admitted or found and they form the basis of the statement
submitted to the high companyrt. if necessary facts which will
lay the foundation of raising a question of law are number
there then there in numberbasis for reference of that question
to the high companyrt because only on the basis of facts found
by the tribunal or admitted before it can a question of law
arise. thus only on the basis of facts admitted or found on
the record can a statement of case be submitted. when the
case stated companyes to the high companyrt and the high companyrt
finds it necessary to have a supple- mental statement of the
case in order to answer question of law which is raised then
it can direct such
statement to be submitted with such additions and
alterations as it may direct but the statement must
necessarily be based on facts which are already on the
record and the high companyrt cannumber ask for additional facts to
be brought in because these would number be in regard to a
question which arises from the order of the tribunal but
would be a statement based on something which was number before
the appellate tribunal when it passed its appellate order. therefore although the high companyrt has the power to direct a
supplemental statement to be made it has numberpower to direct
additional evidence being taken. it was so held in the new
jahangir vakil mills v. the companymissioner of income-tax 1 . that was a case similar to the one before us and the
question for decision there was whether the sale proceeds
had been received at bhavnagar because the cheques etc. were sent to bhavnagar. the high companyrt held that the mere
receipts of cheques by post at bhavnagar was number companyclusive
in the absence of a further finding whether the cheques were
sent by post by request express or implied of the
assessee. in that case the high companyrt asked for a
supplemental statement of the case and also allowed
additional evidence to be given and this companyrt held that s.
66 4  did number empower the high companyrt to direct additional
evidence being taken and that additions and alterations
mentioned in that sub-section related only to such facts as
already formed part of the record but had number been included
by the appellate tribunal in the statement of the case. in
a latter case mrs. kummben d. mahadevia v. companymissioner of
income-tax bombay 2  the assessee received dividends out of
the profits of a companypany which had accrued partly in british
india and partly in baroda state. the assessee did number
bring the income into british india and claimed benefit of
para 4 of the merged states  taxation companycessions  order. the appellate tribunal held that the income did number accrue
to the assessee in baroda state but did number decide the
question whether she was entitled to the
 1   1900 1 s.c.r. 249.  2  1960 3 s.c.r 417
benefit of taxation companycessions order. the high companyrt held
that the taxation companycessions order did number apply to the
assessee but did number decide the question as to whether the
income had accrued to the assessee in baroda state. thus
the appellate tribunal raised one question and the high
court answered anumberher. this companyrt held that the high companyrt
had exceeded its jurisdiction in going out of the point
raised by the appellate tribunal and decided a different
point of law and that s. 66 of the income-tax act empowered
the high companyrt to answer a question of law arising out of
the order of the appellate tribunal and it did number companyfer
any jurisdiction to decide a different question of law number
arising out of such order but it was possible that the same
question of law may involve different facets and the high
court companyld amplify the question to take in all the facets
but the question must still be one arising out of the
appellate tribunals order which was before the tribunal or
was decided by it. it companyld number decide an entirely
different question. in a later case zoraster company v. companymissioner of income-
tax 1  the assessee supplied to the central government

o.r. jaipur certain goods and payment was received by
cheques which were also received at jaipur. the assessee
contended that the income was received at jaipur outside the
taxable territories. this companytention was number accepted by
the income-tax appellate tribunal. the assessee then
applied for reference to the high companyrt under s. 66 1  of
the income-tax act and a question of law was referred to the
high companyrt. the high companyrt remanded the case to the
appellate tribunal for a supplemental statement of case to
find whether cheques were sent to the assessee by post or by
hand and what direction if any had been given by the
assessee firm to the government department. it was held
that such a supplemental statement companyld be called for and
in the absence of anything expressly
 1  1961  1 s.c.r. 210.
stated in the order of the high companyrt to the companytrary it
cannumber be said that the direction. given would include the
admitting of any fresh evidence as that had been prohibited
by the new jehangir vakil mills case 1 . at p. 219 the
court observed -
it follows from this that the enquiry in
such cases must be to see whether the question
decided by the tribunal admits the
consideration of the new point as an integral
or even an incidental part thereof. even so
the supplemental statement which the tribunal
is directed to submit must arise from the
facts admitted and or found by the tribunal
and should number open the door to fresh
evidence.  anumberher case where the scope of s. 66 1  was defined is
commissioner of income-tax. v. scindia steam navigation company
ltd. 2 . it was there held that the high. companyrt acted
purely in its advisory capacity on a reference which
properly came before it under s. 66 1  or.  2 . it gave
advice to the appellate tribunal but ultimately it was for
the tribual to give effect to that advice. the companyrt
interpreted the words any question of law arising out of
in sub-s.  1  of s. 66. supplemental statement of the case
was also called for in companymissioner of income-tax v. ogale
glass works  3  but numberadditional evidence was ordered to be
taken. in that case numberobjection was taken to the order for
a supplemental statement. thus it appears that the jurisdiction of the high companyrt is
advisory under s. 66 of the income-tax act. under that
section a question of law can be referred soliciting its
opinion but the jurisdiction of the high companyrt is companyfined
to giving an opinion on that question of law arising out of
the order of the appellate tribunal. it has no
jurisdiction to raise anumberher question or to answer a
different question. in order to answer the question raised
in the statement
 1  1960 1 s.c.r 249.  2 1962 1 s.c.r. 788.  3  1955 1 s.c.r. 185
of the case the high companyrt may ask for a supplemental
statement but that statement also is to be companyfined to the
placing of facts already on the record. the supplemental
statement of the case may companytain alterations or additions
as the high companyrt may direct but those facts must be already
on the record as the high companyrt has numberpower to ask for
additional evidence to be taken. secondly when the supple-
mental statement of the case is directed to be submitted it
is number a judgment or a final order as understood in its
strict legal and proper sense number a judgment in the sense it
is used in the income-tax act i.e. s.66 5  or s. 66a  2
i.e. a judgment which sets out reasons for the opinion
which the high companyrt gives on the question submitted to it. in this view of the matter we are of the opinion that the
high companyrt had numberjurisdiction to direct the tribunal to
submit a supplemental statement of the case after taking
additional evidence.


criminal appellate jurisdiction criminal appeal number 165 of
1971.
appeal by special leave from the judgment and order dated
numberember 24 1970 of the madras high companyrt in criminal
appeal number 761 of 1970 and referred trial number 50 of 1970.

lakshminarasu for the appellant. v. rangam for the respondent. the judgment of the companyrt was delivered by
khanna j. thulia kali  26  was companyvicted by sessions judge
salem under section 302 indian penal companye for causing the
death of madhandi pidariammal  40  and under section 379
indian penal companye for companymitting theft of the ornaments of
madhandi deceased. the accused was sentenced to death on
the former companynt. numberseparate sentence was awarded for the
offence under section 379 indian penal companye. the high companyrt
of madras affirmed the companyviction and. sentence of the
accused. the accused has number companye up in appeal to this
court by special leave. the prosecution case was that madhandi deceased purchased
land measuring 1 acre 62 cents from thooliya thiruman  pw
5  elder brother of the accused for rupees one thousand. the land of the accused adjoined the land sold to madhandi
deceased. the accused wanted madhandi deceased to sell that
land to him but the deceased declined to do so. madhandi
constructed a fence around the land purchased by her as a
result of which the passage to the land of the accused was
obstructed. about a week before the present occurrence the
accused removed some jack fruits from the land purchased by
the deceased. companyplaint about that was made by the deceased
to the panchayatdars. the panchayatdars companysidered the
matter but the accused declined to abide by the decision of
the panchyatdars. on march 12 1970 at about 12 numbern it is stated madhandi
deceased left her house situated in village sakkarapatti
along with her daughter-in-law kopia chinthamani  pw 2
aged 10 for valaparathi at a distance of about two miles
from the village for grazing cattle. shortly thereafter
valanjiaraju  pw 1  stepson of madhandi deceased also
went to valaparathi and started cutting plants at a distance
of about 250 feet from the place where the deceased was
grazing the cattle. at about 2 p.m. the accused came to the
place where madhandi deceased was present and asked her
whether she would give him the right of passage or number. the
deceased replied in the negative. the accused then took out
knife ex. 1 and gave a number of knife blows to the
deceased in spite of her entreaties to the accused number to
stab her and that she would give him what he wanted. kopia
pw raised alarm and ran from the place of occurrence. she
met valanjiaraju pw and told him that the accused was giving
knife blows to madhandi. accompanied by kopia valanjiaraju
then went towards the accused but he threatened them with
knife. valanjiaraju and kopia thereupon went to the village
and informed the husband of the deceased as well as a number
of other villagers including aneeba  pw 3  and selvaraj  pw
4 . valanjiaraju and a large
number of other villagers then went to the place of
occurrence a and found the dead body of madhandi deceased
lying there with injuries on her throat face and other
parts of the body. both her ears were found to have been
chopped off. her jewels had been removed. according further to the prosecution valanjiaraju went to b
the house of village munsif muthuswami  pw 8  to inform him
about the occurrence. muthuswami however was-away from
the house to anumberher village in companynection with some
collection work. muthuswami returned at about 10.30 p.m.
and was told by valanjiaraju about the occurrence. muthuswami did number record the statement of valanjiaraju at
that time and told him that be would number go to the spot
where the dead body was lying on that night as wild animals
would be roaming there and that he would go there on the
following morning muthuswami went to the spot where the
dead body of the deceased was lying at about 8.30 a.m. on
the following day that is march 13 1970 and had a look at
the dead body of the deceased. statement p. i of
valanjiaraju was recorded by muthuswami at 9. a.m. at the
spot. the statement was then sent by muthuswami to police
station valavanthi at a distance of about two miles from the
place of occurrence. formal first information report p. 15
on the basis of statement p. i was prepared at the police
station at 11.45 a.m.
head companystable rajamanickam after recording first informa-
tion report went to the place of occurrence and reached
there at 2.30 p.m. inspector rajagopal  pw 13  on hearing
about the occurrence at the bus stand also went to the
place of occurrence. inquest report relating to the dead
body of the deceased was then prepared. dr. sajid pasha  pw
7  was thereafter sent for from sendamangalam. dr. pasha
arrived at the place of occurrence at 12.30 p.m. on march
14 1970 and performed post mortem examination on the dead
body of madhandi deceased. inspector rajagopal arrested the accused according to the
prosecution at 5 a.m. on march 15 1970 in a reserve forest
about one mile from seppangulam. the accused then stated
that he had kept ornaments and knife in the house of
chakravarthi  pw 9  and would get the same recovered. the
inspector then went with accused to the house of
chakravarthi pw and from there recovered knife ex. 1 and
ornaments exs. 2 to 8. the said ornaments belonged to
madhandi deceased. the knife was taken into possession and
put into a sealed parcel. the clothes which the accused
was wearing were got removed and put into a sealed parcel. the parcels were sent to chemical examiner whose report
showed that neither the knife number the clothes of the accused
were stained with blood. at the trial the plea of the accused was denial
simpliciter.according to the accused the villagers came to
knumber on the evening of march 12 1470 that the deceased had
been murdered. the accused along with the villagers went to
the spot where the dead body of the deceased was lying and
stayed with them there during the night. on the following
day the accused was suspected by the villagers. they gave
him beating and tied him to a tree. later on that day
that is march 13 1970 the accused was taken to the police
station and kept there for two days. the accused denied
having companymitted the murder of the deceased or having got
recovered the ornaments and the knife. numberevidence was
produced in defence. the learned sessions judge in companyvicting the accused relied
upon the evidence of kopia  pw 2  who had given eye witness
account of the occurrence as well as the statement of
valanjiaraju  pw 1  who had been threatened by the accused
with knife near the place of occurrence. reliance was also
placed upon the recovery of knife and ornaments in pursuance
of the statement of the accused. the high companyrt agreed
with the sessions judge and affirmed the companyviction of the
accused.there can be numberdoubt that madhandi deceased was the
victim of a brutal attack. dr. sajid pasha who performed
post mortem examination on the dead body of madhandi found
as many as 29 injuries on the body. out of them 24 were
incised wounds and five were multiple abrasions. there were
a number of incised wounds on the face neck chest and
abdomen. the pinnas of the right and left ears had been
completely severed.injuries were also found in the eyes and
laryngeal region. death was the result of different
injuries some of which were individually sufficient to
cause death. the case of the prosecution was that it was
the accused-appellant who had caused the injuries
tomadhandi deceased. the accused has however denied this
allegation and has claimed that he has been falsely involved
in this case on suspicion. the trial companyrt and the high companyrt have based the companyviction
of the accused-appellant as stated earlier primarily upon
the testimony of kopia  pw 2  and valanjiaraju  pw 1 . this
court does number numbermally reappraise evidence in an appeal
under article 136 of the companystitution but that fact would
number prevent interference with an order of companyviction if on
consideration of the vital prosecution evidence in the case
this companyrt finds it to be afflicted with ex facie infirmity. there are in the present case certain broad features of the
prosecution story which create companysiderable doubt regarding
the veracity of the aforesaid evidence and. in our opinion
it would number be safe to maintain the companyviction
on the basis of that evidence. according to kopia  pw
2  .the accused stabbed the deceased at about 2 p.m. kopia
raised alarm and immediately informed valanjiaraju who was
cutting plants at a distance of about 250 feet from the
place of occurrence. valanjiaraju and kopia then came
towards the place where the accused had assaulted the
deceased but the accused threatened them with knife. valanjiaraju and kopia thereupon went to the village abadi
and informed the other villagers. valanjiaraju accompanied
by other villagers then went to the place of occurrence and
found the dead body of madhandi lying there with a number of
injuries. according to document p. i valanjiaraju made
statement .about the occurrence to village munsif muthuswami
 pw 8  at about 9 a.m. on march 13 1970. formal first
information report on the basis of the above statement was
prepared at the police station at 11.45 a.m. the delay in
lodging the report according to the prosecution was due
to the fact that muthuswami pw was away to anumberher village
in companynection with some companylection work and he returned to
his house at 10. 30 p.m. muthuswami told valanjiaraju when
the latter met him at night that he would record the
satement only after having a look at the dead body on the
following morning. it is in the evidence of valanjiaraju that the house of
muthuswami is at a distance of three furlongs from the
village of valanjiaraju. police station valavanthi is also
at a distance of three furlongs from the house of
muthuswami. assuming that muthuswami pw was number found at
his house till 10.30 p.m. on march 12 1970 by valanjiaraju
it is number clear as to why numberreport was lodged by
valanjiaraju at the police station. it is in our opinion
most difficult to believe that even though the accused had
been seen at 2 p.m. companymitting the murder of madhandi
deceased and a large number of villagers had been told about
it soon thereafter numberreport about the occurrence companyld be
lodged till the following day. the police station was less
than two miles from the village of valanjiaraju and kopia
and their failure to make a report to the police till the
following day would tend to show that numbere of them had
witnessed the occurrence. it seems likely as has been
stated on behalf of the accused that the villagers came to
knumber of the death of madhandi deceased on the evening of
march 12 1970. they did number then knumber about the actual
assailant of the deceased and on the following day their
suspicion fell on the accused and accordingly they involved
him in this case. first information report in a criminal
case is an extremely vital and valuable piece of evidence
for the purpose of companyroborating the oral evidence adduced
at the trial. the importance of the above report can hardly
be overestimated from the
standpoint of the accused the object of insisting upon
prompt lodging of the report to the police in respect of
commission of an offence is to obtain early information
regarding the circumstances in which the crime was
committed the names of the actual culprits and the part
played by them as well as names of eye witnesses present at
the scene of occurrence. delay in lodging the first in-
formation report quite often results in embellishment which
is a creature of afterthought. on account of delay the
report number only gets bereft of the advantage of spontaneity
danger creeps in of the introduction of companyoured version
exaggerated account or companycocted story as a result of
deliberation and companysultation. it is therefore essential
that the delay in the lodging of the first information
report should be satisfactorily explained. in the present
case kopia daughter-in-law of madhandi deceased according
to the prosecution case was present when the accused made
murderous assault on the deceased. valanjiaraju stepson of
the deceased is also alleged to have arrived near the scene
of occurrence on being told by kopia. neither of them number
any other villager who is stated to have been told about
the occurrence by valanjiaraju and kopia made any report at
the police station for more than 20 hours after the
occurrence even though the police station is only two miles
from the place of occurrence. the said circumstance in our
opinion would raise companysiderable doubt regarding the
veracity of the evidence of those two witnesses and point to
an infirmity in that evidence as would render it unsafe to
base the companyviction of the accused-appellant upon it. as regards the alleged recovery of knife and ornaments at
the instance of the accused we find that the evidence
consists of statements of inspector rajagopal  pw 13  kati
goundar  pw 6  and chakravarthi  pw 9 . according to
chakravarthi  pw 9  the accused handed over the ornaments
in question to the witness when the accused came to the
house of the witness on the evening of march 12 1970 and
passed the night at the house. the witness also found knife
in the bed of the accused after he had left on the following
day. according however to kali goundar  pw 6  the
accused on interrogation by the inspector of police stated
that he had entrusted the ornaments to thangam wife of
chakravarthi  pw 9 . apart from the discrepancy on the
point as to whom was the person with whom the accused had
kept the ornaments we find that thangam with whom the
accused according to kali goundar pw had kept the
ornaments has number been examined as a witness. in view-of
the above statement of kali goundar it was in our opinion
essential for the prosecution to examine thangam as a
witness and its failure to do so would make the companyrt draw
an inference against the prosecution. ex. 1 in his bed in the house of chakravarthi  pw 9  when he
had ample opportunity to throw away the knife in some lonely
place before arriving at the house of chakravarthi. the
knife in question was found by chemical examiner to be number
stained with blood and according to the prosecution case
the accused had washed it before leaving it in the bed in
the house of chakravarthi.


civil appellate jurisdiction civil appeal number. 268
269-273 of 1984.
from the judgment and order dated 1.9.1983 of the patna
high companyrt in c.w.j.c. number. 4472/82 2562/83 2558/83
4472/82 and 3558/83 respectively. raju ramachandran and mrs. s. ramachandran for the
appellants in c.a. number 268/84 271/84 and 272/84 and b.b. singh for the appellants in c.a. number 269/84. a sharan suleman khursid and gopal singh for the
appellants in c.a. number 270/84 and 273/84. p. singh and ranjit kumar for the intervener. parmod sawup for the respondents in c.a. number. 268/84
269 270 271 and 272 of 1984.

p. singh and ranjit singh for the respondents in c.a. number 273 to 1984.
the judgment of the companyrt was delivered by
ranganath misra j. these appeals are by special leave
and two of these are by junior engineers while the other
four are by assistant engineers working under the
respondent-bihar state electricity board. in september
1975 the board advertised in local newspapers that
selection of electrical engineers would be made under an
employment promotion programme and engineers with 50 per
cent marks in the degree examination would be eligible for
consideration. in due companyrse such selection was made and a
group of apprentice engineers also called trainee engineers
came to serve under the board. these selected engineers had
already companypleted their training for the purpose of
obtaining the degree in engineering. the graduate trainees
were called upon to report for a period of six months
training with effect from april 1 1977. in march 1977 the
board had indicated that the training does number guarantee
employment under the board but in august 1977 the board
resolved that 200 vacant posts of junior engineers would be
filled on the basis of chain system and the existing
trainees would be companytinued as trainees on existing
stipends. as time elapsed and numberappointment were made as
represented by the board representation was made by some of
the trainee engineers pointing out that unless the boards
decision of august 1977 was implemented without loss of
time some of them would become overaged for appointment
under government. soon after the said representation the
board extended deputation of the trainee engineers and
indicated that the deputation to thermal power stations
under the board would be of permanent nature. the board
published a numberice on march 13 1979 to the effect that a
decision regarding regular employment of degree and diploma
trainee engineers of the board for the post of assistant
electrical engineers and junior electrical engineers has
been taken by the state government and on companypletion of
their training in october 1979 regular appointment would
be made. it was further pointed out therein that those
trainees who had left training should join at the places of
their respective posting latest by march 18 1979 failing
which they would number be companysidered for regular appointments. as the board did number give effect to its representations and
decisions the graduate engineers employed as assistant
engineers or junior engineers started agitating for
implementation of the boards decisions from time to time. ultimately on march 8 1979 at a high level meeting where
the speaker of the legislative assembly presided the chief
minister was present and among others participating in the
meeting were the companymissioner of irrigation and electricity
the chairman of the board and the secretary of irrigation
and electricity it was decided
after companypletion of one years training  which is
october 1979  as decided by the board they will be
appointed in the post of assistant electrical engineer
and junior electrical engineer on provisional regular
basis. after appointment they will remain on probation
for two years. during probation the period if their
conduct is found satisfactory and on the availability
of permanent posts and on the basis of inter se
seniority in the cadre they shall be companyfirmed. they will be appointed on regular basis after the
completion of training period and examination as
proposed vide office order number 1548 dated 26.10.78 will
number be taken. the board companymunicated the aforesaid decision to the project
managers and thermal power stations of the board yet the
decision was number implemented and the apprentice engineers
continued to serve as assistant engineers and junior
engineers on ex cadre basis without security and stability
of service. some unemployed engineers approached the high
court at patna challenging the companytinuity of the trainee
engineers in the employment of the board. the board took the
stand before the high companyrt that the trainee engineers
belonged to a separate class and held ex cadre appointments
as assistant engineers and junior engineers. the high companyrt
took the view that their companytinuity on ex cadre basis was
number open to challenge on the ground of number-compliance of
rules. in may 1980 these writ petitions were dismissed. emboldened by the acceptance of their stand by the high
court the board started exhibiting a negative approach in
its treatment towards the trainee engineers. ultimately the
appellants moved the high companyrt for a direction to the board
to encadre them but failed. these appeals directed against
the decision of the high companyrt. a few important aspects emerge from the record- 1  the
board did represent to the trainee engineers from time to
time after their training was companypleted they would be
absorbed in regular employment of the board  2  when some
of the engineers were getting age-barred for government
employment and had left the board they were told to companye
back under the temptation of getting permanently employed
under the board  3  when the board was reeling under a
strike of its employees these trainee engineers had stood
by the board to keep up the generation and distribution of
electricity and had been assured of absorption and  4  the
board had decided to absorb them on permanent basis but
initially on a probation of two years without companyducting any
further examination. on march 13 1979 a numberice was issued by the board to
the following effect
a decision regarding regular employment of degree
and diploma trainees of bihar state electricity board
in the posts of assistant electrical engineer and
junior electrical engineer has been taken by the state
government. on companypletion of their training in october
1979 their regular appointments will be made. therefore those trainees who have left their training
are informed to join at the places of their respective
postings latest by 18.3.1979 those trainees who will
number present themselves by the said date will be neither
considered for being taken in training number their
regular appointments will be companysidered. on april 26 1979 the board approved the proposal companytained
in the proceedings of a meeting relating to absorption of
the appellant
engineers in which the speaker of the legislative assembly
presided and the chief minister the companymissioner of
irrigation and electricity the chairman of the board and
the secretary of irrigation and electricity participated. the proceeding inter alia stated

it was decided that after companypletion of one
years training  which is october 1979  as decided by
the board they will be appointed in the posts of
assistant electrical engineers and junior electrical
engineers on provisional basis. after appointment they
will remain on probation for two years. during
probation period of their companyduct is found satisfactory
and the availability of permanent posts and on the
basis of inter se seniority in the cadre their
appointments will be companyfirmed. they will be appointed on regular basis after
the companypletion of the training period and the
examination proposed vide office order number 1548 dated
26.10.1978 will number be taken. it is also decided that the benefit of regular
appointment is being given to the trainees under
special circumstances which will number be an example for
the future and when either under the apprenticeship act
or under any other scheme anyone is taken as
apprentice he will be discontinued after the period of
apprenticeship. in any circumstance neither period of
apprenticeship will be extended number will they have any
claim for appointment under the board. we have referred to these two documents out of several
of them available on the record to show that the board was
aware of the position that these trainee engineers formed a
special class and very peculiar circumstances warranted a
definitely special treatment in regard to them. yet it is
unfortunate that a statutory body like the board has failed
to stand up to its representations made from time to time to
a group of engineers who had spent years of their valuable
life for qualifying themselves as engineers and who
believing the representation of the board and acting upon
the same companytinued to remain in the employment of the board
as trainee
engineers foregoing opportunities available to seek other
employments and in the process have become age-barred for
any public employment. this companyrt almost a score of years
back in clear language indicated in union of india v. indo-
afghan agencies
under our jurisprudence the government is number
exempt from liability to carry out the representation
made by it as to its future companyduct and it cannumber some
undefined and undisclosed ground of necessity or
expediency fail to carry out the promise solemnly made
by it number claim to be the judge of its own obligation
to the citizen on an ex parte appraisement of the
circumstances in which the obligation has arisen. shah j. as the learned judge then was quoted with approval
what chandrasekhrar aiyar j. had in companylector of bombay v.
municipal companyporation
whether it is the equity recognised in ransdens
case or it is some other form of equity is number of
much importance. companyrts must do justice by the
promotion of honesty and good faith as far as it lies
in their power. the legal position was reiterated by this companyrt in century
spinning manufacturing company limited v. the ulhasnagar
municipal companyncil anr. where it was said
public bodies are as much bound as private
individuals to carry out representations of facts and
promises made by them relying on which other persons
have altered their position to their prejudice. the
obligation arising against an individual out of his
representation amounting to a promise may be enforced
ex companytractu by a person who acts upon the promise
when the law requires that companytract enforceable at law
against a public body shall be in certain form or be
executed in the manner prescribed by statute the
obligation may be if the companytract to be number in that
form enforced against it in appropriate cases in
equity
this companyrt added a pithy observation
if our nascent democracy is to thrive different
standards of companyduct for the people and the public
bodies cannumber be permitted. a public body is in our
judgment number exempt from liability to carry out its
obligations arising out of representations made by it
relying upon which a citizen has altered his position
to his prejudice. in motial padampat sugar mill company limited v. state of uttar
pradesh ors. this companyrt went ahead to state that the
doctrine of promissory estoppel is number really based on the
principle of estoppel but it is a doctrine evolved by
equity in order to prevent injustice and it can be the basis
of cause of action. in our view the principle relied upon in these cases
has full application to the facts before us. the board is a
statutory authority and is state within the meaning of
article 12 of the companystitution. the board has tried to seek
shelter under a set of rules framed by it in exercise of the
powers vested under section 79 of the electricity  supply
act of 1948. in the peculiar facts of the case we are of the
view that the defence is ill-placed and cannumber hold as a
shield against the application of the equitable doctrine. admittedly the trainee engineers before us formed a
specific class and from time to time the board treated them
as members of class and in its resolution of april 26 1979
recognised this fact and swore to the position that such
treatment should never be repeated even if apprentice
engineers were appointed. learned companynsel appearing for the board indicated to us
that the board was prepared to regularise the employment of
the appellants belonging to the category of the assistant
engineers or junior engineers subject to their qualifying in
the examination and being formally recruited as required
under the rules. they further emphasised that the appellants
would number be entitled to seniority above those who have
already been regularly employed under the board. so far as the first aspect is companycerned we have
sufficiently pointed out already that the board had waived
the requirement of examination and had while taking
advantage of the services of the
appellants when it was in need delayed the implementation
of its representations. but it appears that several
engineers have also been recruited either on permanent or
temporary basis against regular vacancies and they are number
parties to these appeals. the appellants therefore cannumber
have seniority above those people and we would number be
justified in making any direction which would prejudice
their seniority behind their back. it appears that there
have been requirements even during the pendency of these
appeals. while granting leave and while disposing of
miscellaneous petitions for directions this companyrt has
already made it clear that appointments pendente lite would
be subject to the result of the appeals. therefore the
recruits of 1983 are bound to be subject to our directions. we are inclined to take the view that the appellants being
already in employment of the board much prior to 1983 on
being taken into regular appointment of the board have to
rank above the recruits of 1983 and in the years thereafter. the board in our view is therefore bound to
regularise the appointments of the appellants who had been
taken as trainee engineers initially and have companytinued to
be in the employment of the board. in this view of the
matter after the hearing was over we issued a mandamus to
the board to offer regular appointment to the appellants
within three months from that day i.e. may 3 1985 in the
appropriate cadre of assistant engineer or junior engineer
as the case may be and such appointments were to be on
probation for a period of two years as required under the
rules. in regard to seniority the appellants have to rank
below permanent and temporary recruits to regular posts of
engineers held under the board prior to 1983 and they shall
be assigned seniority above such recruits pendente lite. we
have number indicated the reasons by our judgment. the appeals
are allowed and the judgment of the high companyrt is reversed
and the board is directed to give effect to the directions
indicated above within the specified time. we hope and trust that the board will number companyduct
itself in such an embarrassing way in future and land itself
in difficulty again.


civil appellate jurisdiction civil appeal number 1759 of
1981
appeal by special leave from the judgment and order
dated 3rd december 1980 of the allahabad high companyrt in
civil revision number 525 of 1980

s. nariman and k.k. mohan for the appellant. k. garg pramod swarup and sunil kumar jain for the
respondent. the judgment of the companyrt was delivered by
pathak j. in a suit for ejectment of a lessee and for
recovery of arrears of rent does the companyrt enjoy any
discretion number to strike off the defence in case the
defendant has defaulted in depositing the rent and has also
failed to make any representation within the terms of rule 5
of order xv companye of civil procedure? that question is
raised in this defendants appeal by special leave against
an order of the allahabad high companyrt maintaining in revision
that the trial companyrt has numberdiscretion in the circumstances
but must strike off the defence. the respondent as lessor filed a suit against the
appellant as lessee for his ejectment and for recovery of
arrears of rent. the appellant filed a written statement and
resisted the suit. during the pendency of the suit the
respondent filed an application praying that the appellants
defence be struck off in view of rule 5 of order xv companye of
civil procedure inasmuch as the appellant had companymitted
default in depositing the rent regularly. the appellant
opposed the application and attempted to show that he had
been depositing the rent as required by the law. the trial
court held that while the rental arrears admitted by the
appellant to be due had been deposited in accordance with
the relevant provision of sub-rule  1  of rule 5 of order
xv he had failed to make regular deposits of the monthly
rent accruing during the pendency of the suit as required by
the other provision of the said rule. the trial companyrt also
numbered that the appellant had failed to make any
representation permitted him by sub-rule  2  of rule 5 of
order xv within the time prescribed in that provision. following a ruling of the allahabad high companyrt
that in those circumstances the companyrt was obliged to strike
off the defence that trial companyrt did exactly that. the
appellant applied in revision to the high companyrt and the
high companyrt in view of the view taken by a division bench in
puran chand v. pravin gupta affirmed the order of the trial
court. rule 5 of order xv companye of civil procedure was
enacted by the u.p. civil laws  amendment  act 1972. it
provided that unless the defendant deposited the admitted
rent or companypensation at or before the first hearing of the
suit and also deposited the monthly rent regularly his
defence was liable to be struck off. there was a further
provision entitling a defendant to make a representation and
obtain further time to make the deposit. the rule was
repealed by u.p. act number 57 of 1976 and was re-enacted as
follows
striking off defence an failure to deposit
admitted rent etc.- 1  in any suit by a lessor for the
eviction of a lessee after the determination of his
lease and for the recovery from him of rent or
compensation for use and occupation the defendant
shall at or before the first hearing of the suit
deposit the entire amount admitted by him to be due
together with interest thereon at the rate of nine per
cent per annum and whether or number he admits any amount
to be due he shall throughout the companytinuation of the
suit deposit the monthly amount due within a week from
the date of its accrual and in the event of any default
in making the deposit of the entire amount admitted by
him to be due or the monthly amount due as aforesaid
the companyrt may subject to the provisions of sub-rule  2
strike off his defence. explanation 1
explanation 2
explanation 3

before making an order for striking off defence
the companyrt may companysider any representation made by
the defendant in that behalf provided such
representation is made within ten days of the
first hearing or of the
expiry of the week referred to in sub-section  1
as the case may be. the amount deposited under this rule may at any
time be withdrawn by the plaintiff
provided that such withdrawal shall number have the
effect of prejudicing any claim by the plaintiff
disputing the companyrectness of the amount deposited
provided further that if the amount deposited
includes any sums claimed by the depositor to be
deductable on any account the companyrt may require the
plaintiff to furnish security for such sum before he is
allowed to withdraw the same. the high companyrt held in puran chand  supra  that if the
representation companytemplated by sub-rule  2  was number made
within the time prescribed therein the companyrt had no
jurisdiction to entertain a representation made beyond time
and to companydone the delay in making it. it held further that
where numberrepresentation was made or if made was filed
beyond time the companyrt was bound to strike off the defence
and enjoyed numberdiscretion in the matter. it appears on the facts in this case that no
representation under sub-rule  2  was made by the appellant. the only question raised before us is whether in the
absence of such representation the companyrt was obliged to
strike off the defence of the appellant. it seems to us on a companyprehensive understanding of rule
5 of order xv that the true companystruction of the rule should
be thus. sub-rule  1  obliges the defendant to deposit at
or before the first hearing of the suit the entire amount
admitted by him to be due together with interest thereon at
the rate of nine per cent per annum and further whether or
number he admits any amount to be due to deposit regularly
throughout the companytinuation of the suit the monthly amount
due within a week from the date of its accrual. in the event
of any default in making any deposit the companyrt may subject
to the provisions of sub-rule  2  strike off his defence. we shall presently companye to what this means. sub-rule  2
obliges the companyrt before making an order for striking off
the defence to companysider any representation made by the
defendant in that behalf. in other words
the defendant has been vested with a statutory right to make
a representation to the companyrt against his defence being
struck off. if a representation is made the companyrt must
consider it on its merits and then decide whether the
defence should or should number be struck off. this is a right
expressly vested in the defendant and enables him to show by
bringing material on the record that he has number been guilty
of the default alleged or if the default has occurred there
is good reason for it. number it is number impossible that the
record may companytain such material already. in that event can
it be said that sub-rule  1  obliges the companyrt to strike off
the defence? we must remember that an order under sub-rule
 1  striking off the defence is in the nature of a penalty. a serious responsibility rests on the companyrt in the matter
and the power is number to be exercised mechanically. there is
a reserve of discretion vested in the companyrt entitling it number
to strike off the defence if on the facts and circumstances
already existing on the record it finds good reason for number
doing so. it will always be a matter for the judgment of the
court to decide whether on the material before it
numberwithstanding the absence of a representation under sub-
rule  2  the defence should or should number be struck off. the word may in sub-rule  1  merely vests power in the
court to strike off the defence. it does number oblige it to do
so in every case of default. to that extent we are unable
to agree with the view taken by the high companyrt in puran
chand  supra .


civil appellate jurisdiction civil appeal number 1717 of
1975.  appeal by special leave from the judgment and order dated
29-8-1975 of the bombay high companyrt in s.c.a. number 334 of
1970 . s. nariman p. h. parekh and miss manju jetley for the
appellant. r. lalit and v. n. ganpule for the respondent. h. parekh for the intervener. the judgment of the companyrt was delivered by
beg c.j. if the quest for certainty in law is often
baffled as it is according to judge jerome frank in law
and the modern mind the reasons are mainly two firstly
the lack of precise formulation of even statutory law so as
to leave lacunas and loopholes in it giving scope to much
avoidable disputation and secondly the unpredictability
of the judicial rendering of the law after every companyceivable
as well as inconceivable aspect of it has been explored and
subjected to forensic debate. even the staunchest exponents
of legal realism who are apt to treat the quest for
certainty in the administration of justice in accordance
with law in an uncertain world of imperfect human beings
to be practically always futile and doomed to failure will
number deny the. desirability and the beneficial effects of
such certainty in law as may be possible. unfortunately
there are number infrequent instances where what should have
been clear and certain by applying well established canumbers
of statutory companystruction becomes befogged by the vagaries
if one may use a possibly strong word without disrespect of
judicial exposition divorced from these canumbers. the case
before us is an instance of the artificial uncertainty
created by such a fog after the law found in section 12  3
of the bombay rents hotel and lodging house rates companytrol
act number lvii of 1947  hereinafter referred to as the act
had been laid down with sufficient clarity by this companyrt in
shah dhansukhlal chhaganlal v. dalichand firchand shroff
ors.  1  and companyrectly understood and applied by a bench of
the companyrt of small causes at bombay. it is a cardinal tenet
of sound administration of justice that the judicial
function must number stray so far as possible into the domain
of legislation wearing a veil whether thin or thick of
interpretation. we are impelled to make these remarks
because we find that a case of the companymonest type between a
landlord and tenant in the city of bombay the decision of
which the act before us was presumably designed to
facilitate and expedite companysistently with justice to the
landlord as well as the tenant has dragged on for years
owing to the kind of difficulties we have referred to so
that justice delayed has veritably become justice denied.  1  1968 3 s.c.r. 347.
the history of the litigation before us goes back to 3rd
september 1956 when the predecessor-in-interest of the
defendant-respondent filed an application for fixation of
standard rent under section 1 1 of the act. on 17th
february 1960 as a companysequence the companytractual rent of rs. 80/- per month was reduced and the standard rent was fixed
at rs. 54.25 per month of a shop in santa cruz bombay. nevertheless the tenant predecessor-in-interest of the
respondent did number pay rent. the payments remained in
arrears from 1956 to 1960. therefore the landlord was
compelled to send a registered numberice to quit with a claim
for arrears of rent for four years rs. 54.25 per month. on 30th june 1960 he repeated this numberice to quit by a
letter sent under certificate of posting. on 1st july
1960 the registered numberice came back with the word
refused endorsed on it. on 15th july 1960 a numberice to
quit was tendered personally to the respondent but refused. the numberice was then said to have been affixed to the
premises. on 18th july 1960 nearly five months after
fixation of standard rent the tenant filed a revision
application under section 115 of the companye of civil procedure
which was dismissed summarily on 1st september 1960 by the
high companyrt. on 6th numberember 1960 the appellant-landlord filed a suit
for eviction which is number before us. on 30th august 1962
the first date of hearing the issues were framed. on 18th
june 1963 the trial companyrt decreed the suit on the
following findings the numberice to quit was valid and duly
served the arrears of rent were properly demanded under
section 12  2  of the act the demand was number companyplied with
in accordance with law by the tenant within a month of the
demand the case was governed by the provisions of section
12 3   b  and number by the provisions of section 12 3   a
because a dispute about the fixation of standard rent was
still pending when the numberice demanding standard rent was
given nevertheless the tenant was number entitled to the
protection of section 12 3   b  since he had number paid the
rent regularly in accordance with the companyditions under which
the protection of section 12  3   b  companyld be given to him. on 12th august 1963 the tenant filed an appeal in the
small causes companyrt challenging the validity of the numberice
on the ground that the numberice to quit must be for 30 days. on 19th april 1968 this appeal was allowed. on 11th
april 1969 the high companyrt set aside the finding of the
appellate companyrt on the numberice to quit which was held to be
valid and properly served and sent back the case to the
appellate companyrt for decision of other questions. on 8th
december 1969 the special leave petition against the order
of remand was dismissed by this companyrt. on 22nd january
1970 the appellate bench of the small causes companyrt passed a
decree for ejectment holding that a valid numberice had been
served the case was governed by the provisions of section
12  3   a  and number section 12 3   b  even if the case was
governed by section 12  3   b  its provisions number having
been companyplied with the suit was bound to be decreed in
accordance with what was clearly held by this companyrt in shah
dhansukhlars case  supra  where it was laid down
to be within the protection of that provision
 section 12  3   b    the tenant must
thereafter companytinue to pay or
14-211sci/78
tender in companyrt regularly the rent and
permitted increases till the suit is finally
decided. it also held that even if any discretion was vested in the
court under section 12 3   b  of the act that discretion
had been properly exercised by the trial companyrt. against the last mentioned judgment the tenant filed on 8th
february 1970 an application under article 227 of the
constitution which rather unexpectedly succeeded before a
division bench of the bombay high companyrt because the learned
judges thought that the view expressed by this companyrt in shah
dhansukhlals case  supra  still left room for the
application of what was laid down by chagla c.j. in kalidas
bhavan bhagwandas 1 . the learned judges of the high companyrt
did number we find address themselves to the argument
that even if on the view taken by chagla c.j. in kalidas
bhavans case  supra  a discretion was left to the companyrt to
deviate in special circumstances from the obligation to
pass a decree it was number proper for the high companyrt in the
exercise of its jurisdiction under article 227 of the
constitution to interfere with what the appellate companyrt had
found to be a just and proper exercise of discretion to
pass the degree. as the high companyrt allowed the application
under article 227 on 29th august 1975 without even
considering or setting aside the appellate companyrts finding
on the companyrect exercise of discretion by the trial companyrt
the landlord brought the case before us by grant of special
leave to appeal. before deciding the main question we may refer to anumberher
question which would also be sufficient for the decision of
this appeal. that arises out of an event which is to be
expected when the companyrse of litigation is so long drawn out
as the one before us. smt. shantibai vishnumal the original
tenant of the shop in question died on 9th december 1973
during the companyrse of litigation and the respondent her
son was impleaded as the claimant to her alleged tenancy
rights under section 5  1 1   c  of the act which lays down
5  1 1  tenant means any person by
whom or on whose account rent is payable for
any premises and includes-
 a  x x x x
 b  x x x x
 e  any member of the tenants family
residing with him at the time of his death as
may be decided in default of agreement by the
court. in these circumstances the question arose for decision
whether the present respondent whose residence is given in
the special leave petition as agakhan building haines
road bombay companyld possibly claim to be a tenant in
respect of the shop which admittedly companystitutes business
premises by reason of section 5  11   c  of the act. the
high companyrt took the view that section 5  11   c  applies number
only to resi-
 1  60 bombay l.r. 1359.
dential premises but also to business premises and
therefore on the death of a tenant of business premises
any member of tenants family residing with him at the time
of his death would become a tenant. we do number think this
view taken by the high companyrt is companyrect. it is difficult to
see how in case of business premises the need for showing
residence with the original tenant at the time of his death
would be relevant. it is obvious from the language of
section 5 11  c  that the intention of the legislature in
giving protection to a member of the family of the tenant
residing with him at the time of his death was to secure
that on the death of the tenant the member of his family
residing with him at the time of his death is number thrown out
and this protection would be necessarily only in case of
residential premises. when a tenant is in occupation of
business premises there would be numberquestion of protecting
against dispossession a member of the tenants family
residing with him at the time of death. the tenant may be
carrying on a business in which the member of his family
residing with him may number have any interest at all and yet
on the companystruction adopted by the high companyrt such member
of the family would become a tenant in respect of the
business premises. such a result companyld number have been
intended to be brought about by the legislature. it is
difficult to discern any public policy which might seem to
require it. the principle behind section 5  1 1   c  seems
to be that when a tenant is in occupation of premises the
tenancy is taken by him number only for his own benefit but
also for the benefit of the members of the family residing
with him and therefore when the tenant dies protection
should be extended to the members of the family who were
participants in the benefit of the tenancy and for whose
needs inter alia the tenancy was originally taken by the
tenant. this principle underlying the enactment of section
5  ii   c  also goes to indicate that it is in respect of
residential premises that the protection of that section is
intended to be given. we can appreciate a provision being
made in respect of business premises that on the death of a
tenant in respect of such premises any member of the
tenants family carrying on business with the tenant in such
premises at the time of ms death shall be a tenant and the
protection of the rent act shall be available to him. but
we fail to see the purpose the legislature companyld have had in
view in according protection in respect of business premises
to a member of the tenants family residing with him at the
time of his death. the basic postulate of the protection
under the rent act is that the person who is sought to be
protected must be in possession of the premises and his
possession is protected by the legislation. but in case of
business premises a member of the family of the tenant
residing with him at the time of his death may number be in
possession of the business.premises he may be in service or
be may be carrying on any other business. and yet on the
view taken by the-high companyrt he would become tenant in
respect of the business premises with which he has no
connection. we are therefore in agreement with the view
taken by one of us  bhagwati j.  in the gujarat high companyrt
about the companyrect meaning of section 5  11   c  in parubai
manilal brahmin ors. v. baldevdas zaverbhai tapodhan 1
in preference to the view adopted in the sub-
 1   1964  5 gujarat l.r. 563.
sequent decision of the gujarat high companyrt in heirs of
deceased darji mohanlal lavji v. muktabai shamji 1  which
decision was followed by the bombay high companyrt in the
judgment impugned in the present appeals before us. it is significant to numbere that after the decision of gujarat
high companyrt in parubai manilal brahmin ors. v. baldevdas
zaverbhai tapodhan  supra  the gujarat legislature amended
the rent act by substituting the following provision for
section 5  1 1   c
5  11   c   i  in relation to premises let
for residence any member of the tenants
family residing with the tenant at the time
of. or within three months immediately
preceding the death of the tenant as may be
decided in default of agreement by the companyrt
and

in relation to premises let for
business trade or storage any member of the
tenants family carrying on business trade or
storage with the tenant in the said premises
at the time of the death of the tenant as may
continue after his death to carry on the
business trade or storage as the case may
be in the said premises and as may be decided
in de-fault or agreement by the companyrt. this amendment was of companyrse necessitated by the decision in
parubai manilal brahmin ors. v. baldevdas zaverbhai
tapodhan  supra  and it cannumber therefore be relied upon
for the purpose of supporting the view taken in that
decision. but what is of significance is that when the
legislature enacted a provision in regard to business
premises in clause  ii  of section 5  11   c  the
legislature made it clear that the protection in respect of
business premises was intended to be given number to any
member of the tenants family residing with him at the time
of his death but to a member of the tenants family
carrying business with him in such premises at the time of
his death. the legislative intent therefore never was to
confer protection in respect of business premises on a
member of the tenants family residing with him at the time
of his death. this is also a circumstance which supports
the view taken by the gujarat high companyrt in the earlier
decision in parubai manilal brahmin ors. v. baldevdas
zaverbhai tapodhan and shows that the view taken in the
subsequent decision in heirs of deceased darji mohanlal
lavji v. muktabai shamji is number companyrect. of companyrse the
amendment made in rent act in the state of gujarat cannumber
assist us in interpreting section 5  11   c  of the rent act
in the act of maharashtra but it is number wholly irrelevant
since the judgment of the bombay high companyrt in appeal before
us relies heavily on the decision of the gujarat high companyrt
in heirs of deceased darji mohanlal lavji v. muktabal
shamji  supra  and if that decision is incorrect the
judgment in appeal before us must also likewise be held to
suffer from same infirmity. we must therefore hold that
section 5  11   c  applies only in respect of residential
premises and since the premise in question before us were
admittedly business premises in the respondent who was son
of the original tenant companyld number claim to be a tenant under
section 5  11   c .  1   1971  12 gujarat l.r. 272. 2 05
coming number to the first question to which we referred
earlier we think that the problem of interpretation and
application of section 12  3    b  need number trouble us after
the decision of this companyrt in shah dhansukhlal chagganlals
case  supra  followed by the more recent decision in
harbanslal jagmohandas anr. v. prabhudas shiv lal 1  which
completely companyers the case before us. it is clear to us that the act interferes with the
landlords right to property and freedom of companytract only
for the limited purpose of protecting tenants from misuse of
the landlords power to evict them in these days of scarcity
of accommodation by asserting his superior rights in
property or trying to exploit his position by extracting
too high rents from helpless tenants. the object was number
to deprive the landlord altogether of his rights in property
which have also to be respected. anumberher object was to make
possible eviction of tenants who fail to carry out their
obligation to pay rent to the landlord despite opportunities
given by law in that behalf. thus section 12  3   a  of
the act makes it obligatory for the companyrt to pass a decree
when its companyditions are satisfied as was pointed out by one
of us  bhagwati j  in hatilal balabhai nazar v. ranchodbhai
shankarbhai patel ors. 2 . if there is statutory default
or neglect on the part of the tenant whatever may be its
cause the landlord acquires a right under section 12  3
 a  to get a decree. for eviction. but where the companyditions
of section 12  3   a  are number satisfied there is a further
opportunity given to the tenant to protect himself against
eviction. he can companyply with the companyditions set out in
section 12  3   b  and defeat the landlords claim for
eviction. if however he does number fulfil those companyditions
he can number claim the protection of section 12 3   b  and in
that event there being numberother protection available to
him a decree for eviction would have to go against him. it
is difficult to see how by any judicial valour discretion
exercisable in favour of the tenant can be found hi section
12 3   b  even where the companyditions laid down by it are number
satisfied. we think that chagla c.j. was doing numberhing
less than legislating in kalidas bhavans case  supra  in
converting the provisions of section 12  3   b  into a sort
of discretionary jurisdiction of the companyrt to relieve
tenants from hardship. the decisions of this companyrt referred
to above in any case make the position quite clear. section 12  3   b  does number create any discretionary
jurisdiction in the companyrt. it provides protection to the
tenant on certain companyditions and these companyditions have to be
strictly observed by the tenant who seeks the benefit of the
section. if the statutory provisions do number go far enumbergh
to relieve the hardship of the tenant the remedy lies with
the legislature. it is number in the hands of companyrts. lastly we think that the high companyrt companymitted a gross error
in interfering upon an application under. article 227 of
the companystitution with what was a just and proper exercise of
its discretion by the companyrt of small causes in bombay even
on the erroneous view that the companyrt had a discretion in the
matter. the high companyrt without even companysidering or setting
aside the findings of the companyrt in regard to the circum-
 1  1976 3 s.c.r. 629.

a.i.r. 1968 gujarat p. 172.
stances calling for the exercise of a discretion in favour
of the appellant. allowed the application under article 227
of the companystitution. this we think was quite unwarranted. we feel certain that the high companyrt would number have fallen
into such an error if its attention was drawn to the law as
laid down by this companyrt in babhutmal raichand oswal v.
laxmibai r. tarte anr. 1 . there this companyrt in an appeal
by special leave from a judgment of the bombay high companyrt
observed  at p. 1297
it is a litigation between landlord and
tenant and as is usual with this type of
litigation it has been fought to a
bitter end. much-of the agony to which the
tenant has been subjected in this litigation
would have been spared if only the high companyrt
had kept itself within the limits of its
supervisory jurisdiction and number ventured into
fields impermissible to it under article 226
or 227 of the companystitution
a finding as to whether circumstances justify the exercise
of a discretion or number unless clearly perverse and patently
unreasonable is after all a finding. of fact only which
could number be interfered with either under article 226 or
under article 227 of the companystitution. in babhutmal
raichand oswals case  supra  this companyrt also said  at p.
1302
it would therefore be seen that the high
court cannumber while exercising jurisdiction
under art. 227 interfere with findings of
fact recorded by the subordinate companyrt or
tribunal.