civil appellate jurisdiction civil appeal number 1125 of 1970.
appeal under s. 116-a of the representation of the people
act 1951 from the judgment and order dated march 1970 of
the assam and nagaland high companyrt in election petition number 2
of 1969.

v. gupte s. k. ghose advocate-general nagaland naunit
lal a. r. barthakar r. c. chowdhury and b. k. dass for
the appellant. p. singh a. k. gupta v. j. francis and s. p. singh
for a the respondent. the judgment of the companyrt was delivered by
ray j. this is an appeal from the judgment dated 26 march
1970 of the assam and nagaland high companyrt declaring the
election of the appellant void under section 1 00   1    b
of the representation of the people act  hereinafter
referred to as the act  and further declaring the appellant
to have companymitted a companyrupt practice within the meaning of
section 123 6  of the act for incurring or authorising
expenditure in companytravention of section 77 of the act. the gist of the finding of the high companyrt is that the
appellant showed in his return a sum of rs. 900/- as
election expenses after claiming a refund of rs. 100/- but
the appellant is found to have incurred or authorised
expenditure of a further amount of rs. 154.15 which the
appellant did number include in his return and thereby the
appellant exceeded the permissible limit of rs. 1000/by rs. 54.15.
the finding of the high companyrt is that the appellant
incurred or authorised the expenditure of rs. 90/- for what
is described as pink identity cards and secondly incurred or
authorised the expenditure of rs. 22.65 in respect of
purchase of forms and election handbooks andthirdly
incurred or authorised the expenditure of rs. 42.50 on 18
trunk calls between 15 january 1969 and 11 february 1969
aggregating rs. 154.15 which sum was number included in the
return of election expenses. the appellant was at the time of the election chief minister
of the state of nagaland. the appellant and the respondent
were two candidates at the general election in the year 1969
to the nagaland legislative assembly from number 6 western
angami companystituency. the polling took place on 6 8 and 10
february 1969 and companynting of votes took place on 12
february 1969. the appellant polled 1933 votes. the
respondent polled 935 votes. on 12 february 1969 the
result of the election was declared and the appellant having
secured the majority of valid votes was declared to be
elected. the respondent in the election petition alleged that the
appellant included in his return as election expenses the
sum of rs. 75/paid by him to kohima printing press on 17
january 1969 for printing blue identity cards but the
appellant did number include in the said return a sum of rs. 90/- by him to kohima printing press on 29 january 1969 for
printing a set of pink identity cards issued by him. the
appellant in his written. statement denied that lie spent
izs. 90/- for the purpose of printing identity cards that
were
used by him in any way in his election. the appellant
stated that he spent rs. 75/- only for printing the identity
cards which were used in the election and the same has been
properly accounted for in his statement for his election
expenses. under section 123 6  of the representation of the people act
the incurring or authorising of expenditure in companytravention
of section 77 is a companyrupt practice for the purpose of the
act. section 77 deals with account of election expenses and
maximum thereof. the first sub-section states that every
candidate at an election shall either by himself or by his
election agent keep a separate and companyrect account of all
expenditure in companynection with the election incurred or
authorised by him or by his election agent between the date
of publication of the numberification calling the election and
the date of declaration of the result thereof both dates
inclusive. the second sub-section states that the account
shall companytain such particulars as may be prescribed. the
third subjection states that the total amount shall number
exceed such amount as may be prescribed. the prescribed
maximum for election expenses is the sum of rs. 1000 as
will be found in rule 90 2  of the companyduct of election
rules. that is the sum prescribed for the state of nagaland
for state assembly election. for other states different
amounts are prescribed as the maximum of election expenses
for the state assemblies. the relevant issue with regard to the alleged expenditure of
rs. 90 raises the question as to whether the appellant
incurred or authorised the expenditure of the said amount. on behalf of the appellant the owner of the printing press
vipikejeye gave evidence. he said that the appellant placed
an order  ex. 10  for 5000 identity cards for election and
he also said that exhibit 1 1 the blue identity cards were
printed in his press. the owner of the press further said
that the appellant did number personally companye to place the
order but his party-men came and placed the order the blue
identity card was number found suitable and the owner of the
printing press printed the pink identity card. the owner
was paid rs. 75 for printing 5000 blue identity cards. as
for the pinkcards the evidence of the owner of the printing
press was that the order for the pink cards was placed on 29
january 1969 by the young man of the appellant. the
owner of the press supplied the pink cards numbering 6000
and be received the sum of rs. 90 on 1 february 1969 and
one pralie peseyie paid that sum and took away the pink
identity cards. pralie peseyie was said to be a man of the
appellant. there was numberwritten order for the printing job. the owner of the press specifically said that he did number
receive rs. 90 from the appellant
the appellant in his oral evidence said that the blue
identity card was ordered by him to be printed and he
entrusted one of his worker to do it. on his return the
appellant found that there was something wrong in the blue
identity cards which companytained the words vote for t. n.
angami. the appellant said that he became annumbered and
asked. the person entrusted with the printing of the
identity cards to go immediately to the printing press and
get the cards reprinted companyrectly. after- that the man
brought the pink identity card but he did number tell anything
about the payment of such printing work and that is how the
appellant did number account for them. the-appellant accounted
for rs. 75 as the companyt of printing identity cards. in cross-examination the appellant was asked whether he
asked pralie peseyie to pay the companyt of the blue identity
card because of the appellants annumberance. his answer was
that he did number say anything specifically but pralie peseyie
did something wrong and the latter felt shy and did number ask
any money from the appellant. the appellants evidence was
that the press submitted the bill for the printing of the
blue identity card and the payment was made by the
appellant but he did number personally go and pay. in cross-
examination the appellant was specifically asked whether the
pink identity cards were produced before him with the bill. the appellant answered in the negative. the appellant was
then asked whether before filing the return the appellant
had asked from the press as to what the companyt of the printing
of the pink identity cards was. the appellants answer was
i bad number paid personally and the bill was number produced
before me i did number enquire. the appellant was again asked
whether the amount for printing pink identity cards was
paid. his answer was that the amount was paid by pralie
peseyie. pralie peseyie gave evidence on behalf of the appellant and
said that the appellant was much annumbered because pralie
peseyie without the appellants knumberledge put the words
please vote for t. n. angami on the blue identity cards
and the appellant asked pralie peseyie to get the identity
cards reprinted. pralie peseyie therefore placed order to
get 6000 identity cards printed again. he said that he paid
rs. 90 from his own pocket as he felt that it was his
responsibility to get the cards printed companyrectly. he also
said that he never asked the appellant to reimburse him for
that amount of rs. 90. in cross-examination he was asked
whether he told the appellant that he paid rs. 90. his
answer was in the negative. pralie peseyie further said
that the words please vote for t. n. angami were number on
the sample that the appellant gave but the witness added
those words without the knumberledge of the appellant. the
witness was asked a direct question as to what amount the
witness spent for the appellant in the election and his
answer was i paid rs. 90 for the printing of the pink
identity cards and numbermore. the high companyrt held that the amount of rs. 90 must have been
paid to the-press by pralie peseyie on behalf of the
appellant and therefore the expenditure was incurred by the
appellant as well as authorised by him in companynection with
his election. the respondent in the election petition alleged that the
appellant paid rs. 90. the representation of the people act
uses the words incuffing and authorising the expenditure. the appellant denied that he paid rs. 90. it was never
suggested to the appellant that he had authorised the
expenditure of rs. 90. on the companytrary the positive
evidence of the appellant is that he was annumbered with pralie
peseyie for introducing the words vote for f. n. angami
on the blue identity cards and therefore the appellant
wanted pralie peseyie to get the cards reprinted companyrectly. it is also the evidence of pralie peseyie that he did
something wrong and he had to have it companyrected. he
therefore paid rs. 90 out of his own pocket. the most
significant feature in he evidence is that the bill for
rs. 90 was never produced or sent to the appellant whereas
the bill for the blue identity cards was sent to the
appellant. the manner in which the appellant reprimanded
pralie peseyie for adding the words vote for t. n. angami
would number necessarily involve an obligation to pay and
authorise an expenditure for getting the cards reprinted
correctly. if it were the fault of the press the press
would have to rectify the same. on the other hand if the
blame fell on pralie peseyie he would have to bear the
brunt. the fact that the bill was number sent to the appellant
shows that the fault was of the witness pralie peseyie the
oral evidence also points to that inescapable companyclusion. the high companyrt was in error in holding on the evidence that
the expenditure for rs. 90 was incurred or authorised by the
appellant. this finding is number supported by the evidence
and on the companytrary it is repelled by the evidence. we
cannumber help observing that both the appellant and pralie
peseyie gave evidence in a very straightforward and truthful
manner. they narrated the companyrect companyrse of events. we
accept their evidence and hold that the appellant neither
incurred number authorised the expenditure of rs. 90 for the
pink identity cards. it would therefore number be necessary for us to go into the
question whether the sum of rs. 41.50 for trunk calls and
the sum of rs. 22.65 for purchase of forms and hand-books
were incurred or authorised by the appellant. even if those
two sums of money were added the return would number be in
violation of the maximum amount of rs. 1000/-. companynsel for the respondent companytended that the findings of
the high companyrt on allegations companytained in paragraph 1 a
 f  and  j  of particulars of companyrupt practice mentioned
in paragraph 6 of the petition were incorrect and the
high companyrt should have held that the appellant was guilty
of companyrupt practice. paragraph 1  a  relates to a charge
against the appellant of having paid rs. 200 in cash to
dolhoutha gaonbura of zubra and one bag of sugar for
entertainment of electors attending a function at zubra on
25 january 1969. paragraph 1  f  alleges that on 27 janu-
ary 1969 a womens meeting was held at daklane when it was
annumbernced that a procession would be taken out on 1
february 1969. about 200 people mostly women formed a
procession shouted slogans to vote for the appellant and the
appellant asked them to vote for him and after the meeting a
feast was held at the appellants house at which drinks were
served to the people. paragraph 1  j  alleges that on 27
january 1969 the appellant and his wife and some other
persons came to the village pedugei in companynection with the
election and held a meeting where the appellant and his wife
promised 8 bundles of companyrugated iron sheets for the women
of kiruphema with the object of inducing them to vote for
the appellant and companyrugated iron sheets were later on
brought from dimapur by a truck belonging to mizielhouto and
divided amongst three groups of people. the appellant in
the written statement denied the charges. the respondent did number have personal knumberledge of the feast
alleged in paragraph i  a  of the particulars but three
witnesses were examined on behalf of the respondent. on
behalf of the appellant there was the evidence of dolhoutha
and shitovi hesso. the high companyrt held that the three
witnesses on behalf of the respondent were interested in the
success of the respondent and the three witnesses attributed
statements about feast and distribution of sugar to
dolhoutha who denied the same and said that the people of
the village organised the feast with their money. the high
court companyrectly found that the quality of evidence on behalf
of the respondent was such that numberreliance companyld be placed
upon it. as to allegations of companyrupt practice in paragraph 1  f
about the womens meeting the high companyrt held that there was
numberevidence to indicate that the. respondent or any person
induced the persons present to vote or offered them food and
fruit. on the companytrary the high companyrt found that evidence
of both- sides indicated that it was customary practice in
nagaland to offer hospitality to the people who visit their
house. it will number be companyrect to equate ordinary
hospitality or companyrtesy with companyrupt practice. with regard to allegations mentioned in paragraph i  j  and
the distribution of bundles of companyrugated iron sheets the
high companyrt
held that the womens society asked for companyrugated sheets
for a public cause. the appellant was the chief minister
at the time of the election. it would number be unnatural for
people to make requests to the chief minister for a public
cause. it would also be reasonable to expect that the chief
minister would try to redress grievances of the people. there is numberproof of companyrupt motive. we agree with the high
court that there is numberproof of companyrupt practice alleged in
paragraphs 1  a   f  and  j  of the particulars dealt with
above. for these reasons we accept the appeal and hold that the
appellant is number guilty of any violation of section 123  6
and section 77 of the representation of the people act. the
judgment of the high companyrt is set aside. the charge of
corrupt practice under section 123 6  is set aside.


criminal appellate jurisdiction criminal appeal number
259 of 1973.
from the judgment and order dated 27-4-1973 of the
andhra pradesh high companyrt in criminal revision case number
72/73. b. datar m. n. shroff and r. n. sachthey for the
appellant. govindan nair and a. subba rao for the respondent. the judgment of the companyrt was delivered by
fazal ali j.-this appeal by certificate is directed
against the judgment dated 27th april 1973 of the andhra
pradesh high companyrt allowing the revisional application and
quashing the proceedings taken against the respondent for
offences companymitted under s. 5 2  of the prevention of
corruption act. in the view that we take in the case it is number
necessary to give the facts in detail. il appears that the
respondent was a member of the indian air force having
entered the service on l 7th numberember 1941. he retired from
the service on the 15th june 1965 but was reemployed for a
period of two years with effect from 16th june 1965. o 7th
september 1966 the respondent was transferred to the
regular air force reserve with effect from 16th july 1965 to
15th june 1970 i.e. for a period of five years. in other
words the respondent was transferred to the auxiliary
reserve air force under the provisions of the reserved and
auxiliary air force act 1952  hereinafter to be referred to
as the act  and rules thereunder. on 13th march 1968 the
reemployment given to the respondent ceased and his services
were terminated from 1st april 1968.
a chargesheet was submitted against the respondent for
having companymitted offences under s. 5 2  of the prevention of
corruption act during the period 27th march 1965 to 16th
march 1967. the
respondent filed a petition before the special judge
hyderabad for dropping the proceedings against him on the
ground that the judge companyld number take any companynizance of the
offences in the absence of any valid sanction of the
appointing authority of the respondent. the special judge
however rejected this application on the 20th of october
1972 on the ground that as the respondent was number a
commissioned officer in the air force at the time when the
cognizance was taken numbersanction of the president was
necessary. thereafter the respondent moved the high companyrt
in revision and succeeded before the high companyrt which held
that as the respondent companytinued to be a public servant
within the meaning of s. 21 of the indian penal companye
inasmuch as he remained a member of the air force reserve
sanction was essential before prosecuting the respondent. the high companyrt accordingly accepted the revision petition
and quashed the proceedings against the respondent but
granted a certificate to the appellant for leave to appeal
to this companyrt. hence this appeal before us. the only point that has been canvassed before us was
whether the respondent having retired from the active
service of the indian air force companytinued to be a public
servant even though he was transferred to regular air force
reserve. the companynsel for the union submitted that as the
respondent had retired from the indian air force and his
reemployment was terminated w.e.f. april 1 1968 he ceased
to be a public servant and therefore numbersanction was
necessary. we have heard companynsel for the parties and have
also perused the judgment of the high companyrt and the special
judge. the facts mentioned above are number disputed and two
questions fall for determination in this case. in the first place it has to be decided whether or number
the respondent was a public servant during the period 27-3-
65 to 16-3-67. secondly what is the point of time when the
sanction was necessary viz. the time when the offences
were actually companymitted or when the companyrt took companynizance of
the said offences. we will take up the second point first. an identical question came up for companysideration before this
court in the case of s. a. venkataraman v. the state where
the companyrt speaking through imam j. observed as follows . in our opinion in giving effect to the ordinary
meaning of the words used in s. 6 of the act the
conclusion is inevitable that at the time a companyrt is
asked to take companynizance
number only the offence must have been companymitted by a
public servant but the person accused is still a public
servant removable from his office by a companypetent
authority before the provisions of s. 6 can apply. this case was followed by a recent decision of this companyrt in
the case of state of west bengal etc. v. manmal bhutoria
ors. etc. where the previous decision was followed. in view
of the decisions of this companyrt referred to above the
matter is numberlonger res integra but is companycluded by the
decisions of this companyrt. it fol lows therefore that the
prosecution must prove that at the time when the companynizance
of the offence was taken the respondent ceased to be a
public servant. in the instant case the special judge
appears to have taken companynizance on june 19 1969 at a time
when the respondent companytinued to be a public servant having
been reemployed and as referred to above his services were
terminated only on 1-4-1968 but he companytinued to be a member
of the auxiliary air force upto 15-6-70 that is to say a
long time after the companynizance of the offence was taken. the
learned companynsel for the union how ever submitted that
reemployment under the provisions of the regular air force
reserve act would number amount to an employment in the regular
force of the service and therefore even though the
respondent may have been reemployed he companyld number be said to
hold the status cf a public servant. in this companynection
some of the rules have been placed before us to show the
nature of the employment held by the respondent after his
retirement. it is number disputed that even after reemployment
the respondent was transferred to the air force auxiliary
reserve and companytinued to be a member of the auxiliary air
force reserve. relevant sections of the act are. extracted
below -

constitution of regular air force reserve-the
central government may raise and maintain in the manner
hereafter in this chapter provided an air force reserve
to be designated the regular air force reserve which
shall companysist solely of persons transferred or
appointed to it under section 5.

recruitment to the regular air force reserve- 1  the
competent authority may by general or special order
transfer to the regular air force reserve-
 a  any officer or airman of the air force who
under the terms and companyditions of his service
is liable to
serve in any air force reserve if and when
constituted
 b  any officer or airman of the air force whose
com mission or engagement in the air force
has been terminated before the companymencement
of this act and who under the terms of his
commission or engagement was liable to serve
in any air force reserve if and when
constituted
 c  any officer or airman who has served in the
air force and has retired therefrom
and any officer or airman so transferred shall be
deemed to be a member of the said reserve. the companypetent authority may in such
circumstances and subject to such companyditions
as may be prescribed by special order
appoint to the regular air force reserve any
member of the air defence reserve or the
auxiliary air force raised and maintained
under this act and where any such member is
so appointed he shall cease to be a member
of the air defence reserve or the auxiliary
air force as the case may be and shall as
from the date of such appointment be deemed
to be a member of the regular air force
reserve.  3

classes of persons in the regular air force reserve-
members of the regular air force reserve shall be
divided into the following classes namely-
 a  general duties officers and
 b  ground duties officers and
 c  airmen
and every officer shall be entitled on transfer or
appointment to the reserve to hold the same rank as
that which he-last held in the air force or the air
defence reserve or the auxiliary air force as the case
may be before such transfer or appointment. period of service- 1  every member of the regular
air force reserve shall he liable to serve in the
reserve-
 a  if he is transferred to the reserve under
sub- section  1  of section 5 for the period
of his re serve liability and
 b  if he is appointed to the reserve under sub-
section  2  of section s for the remainder
of the period for which he was liable to
serve in the air defence reserve or the
auxiliary air force as the case may be
provided that the companypetent authority may require
any such member to serve in the reserve for such
further period or periods number exceeding in the
aggregate five years as it may think fit. x x x x x

constitution of air defence reserve-the central
government may raise and maintain in the manner here
after in this chapter provided an air force reserve to
be designated the air defence reserve which shall
consist of persons deemed under the provisions of
section 16 to be enrolled therein. classes of persons in the air defence reserve-
members of the air defence reserve shall be divided
into the following classes namely-
 a  general duties officers
 b  ground duties officers and
 c  airmen. x x x x x

liability to be called up for inquiry-every person
to whom the provisions of section 11 are applicable
shall be liable to be called up for inquiry under
section 13-
 a  if he belongs to any of the classes specified
in clauses  a  to  f  of sub-section  1  of
section 11 until he has companypleted his
thirty-seventh year and
 b  if he belongs to any of the classes specified
in clauses  g  and  h  of the said sub-
section until he has companypleted his fiftieth
year. x x x x x

constitution of auxiliary air force- 1  the central
government may raise and maintain in the manner
hereafter in this chapter provided an air force to be
designated the auxiliary air force. the central government may companystitute such
number of squadrons and units of the auxiliary air
force as it thinks fit and may disband or reconstitute
any squadron or unit. classes of persons in the auxiliary air force-
members of the auxiliary air force shall be divided
into the following classes namely
 a  general duties officers
 b  ground duties officers and
 c  airmen. officers of the auxiliary air force-the president
may grant to such person as he thinks fit a companymission
as an officer in the auxiliary air force with the
designation of rank companyresponding to that of any
commissioned officer in the air force. periods of service-every officer and every enrolled
person shall subject to any rules that may be made in
this behalf under this act be required to serve in the
auxiliary air force for a period of five years from the
date of his appointment or enrollment but may after
the companypletion of his period of service volunteer to
serve therein for further periods each of number more than
five years duration. termination of service-the service of any officer
or enrolled person in the auxiliary air force may at
any time before the companypletion of his period of
service be terminated by such authority and under such
conditions as may be prescribed.  emphasis ours
a perusal of the provisions of these sections would
clearly reveal that once the respondent was transferred to
the auxiliary air force he retained his character as a
public servant because he was required to undergo training
and to be called up for service as and when required.


civil appellate jurisdiction civil appeal number. 2440-
2442 of 1972.
from the judgment and order dated 25-10-1971 of the
delhi high companyrt in income tax reference number. 40 41 of
1970.

k. sen and mr. bishamber lal for the appellant. g. ghokhale and miss a. subhashini for the
respondent. the judgment of the companyrt was delivered by
pathak j.-this appeal by certificate granted by the
delhi high companyrt raises the question whether interest paid
on arrears of cess under s. 3  3  of the u.p. sugarcane cess
act 1956 is a permissible deduction under s. 10  2   xv  of
the indian income tax act 1922.
the assessee is a public limited companypany engaged in the
business of the manufacture and sale of sugar. in its
income-tax return for the assessment year 1959-60  the
previous year being the period ending 30th june 1958  the
assessee claimed a deduction of rs. 120859/- paid as
interest on arrears of cess due under the u.p. sugarcane
cess act 1956. the income-tax officer disallowed the claim
but the appellate assistant companymissioner held that the
payment of interest companystitute a permissible deduction and
this view was affirmed by the income tax appellate tribunal. for the next assessment year 1960-61  the previous year
ending 30th june 1959  the assessee claimed a sum of rs. 183731/- paid by way of interest on the arrears of cess. the claim met with the same fortune disallowed by the
income tax officer but upheld by the appellate assistant
commissioner and the appellate tribunal. at the instance of
the revenue the appellate tribunal referred the following
question of law to the delhi high companyrt in respect of the
assessment years 1959-60 and 1960-61
whether on the facts and in the circumstances of
the case the tribunal was justified in allowing the
interest of rs. 120859/- and rs. 183731/- paid by
the assessee on the arrears of cess in the assessment
years 1959-60 and 1960-61 respectively as revenue
expenditure ? for the assessment year 1961-62 also the previous year
of which ended 30th june 1960 the assessee claimed a
deduction of rs. 200439/- on account of interest paid by
it on arrears of cess. this claim also was rejected by the
income tax officer but allowed by the appellate assistant
commissioner and the appellate tribunal. the revenue
obtained a reference to the high companyrt on the question
whether on the facts and in the circumstances of
the case the tribunal was justified in allowing the
interest of rs. 200439/- paid by the assessee on the
arrears of cess as revenue expenditure? the references were disposed of by the high companyrt by
its judgment dated 25th october 1971. the questions were
answered in the negative. the high companyrt took the view that
the claim of the assessee did number satisfy the provisions of
s. 10  2   iii  of the indian income tax act 1922 because
it was number interest paid on borrowed capital and it did number
fall within the scope of s.10  2   xv  of the act because it
was paid by way of penalty for an infringement of the act. the high companyrt than certified under s. 66  a   2  of the act
that the cases were fit for appeal to this companyrt. learned companynsel for the assessee has made numberattempt to
justify the claim under s. 10  2   iii  and we are
therefore relieved of the necessity of examining the
validity of the claim by reference to that provision. the
case has been argued before us on the basis that it falls
under s. 10  2   xv . the validity of the u. p. sugarcane cess act 1956  the
cess act  was challenged by the assessee and several other
sugar manufacturing companypanies by petitions under article 226
of the companystitution in the allahabad high companyrt. the high
court admitted the writ petitions and granted an order
suspending the operation of the act. the high companyrt on
final hearing dismissed the writ petitions. but
subsequently on appeal this companyrt declared the cess act
ultra vires on
the ground that the act fell beyond the companypetence of the
state legislature. thereafter on 31st january 1961 the president
promulgated the u.p. sugarcane cess  validation  ordinance
1961 validating the cess imposed assessed or companylected by
the government of uttar pradesh during the period 26th
january 1950 to the date of the companymencement of the
ordinance  3rd february 1961 . the ordinance was replaced
by the u.p. sugarcane cess  validation  act 1961  the
validation act . the question whether the interest paid by the assessee
under s. 3 3  of the sugarcane cess act 1956 can be allowed
under s. 10 2   xv  of the income tax act requires us to
examine the relevant provisions of the cess act. the act as
its long title states is an act to amend and companysolidate
the law relating to the imposition of cess on sugarcane
intended for use companysumption in or sale to a factory. the
relevant provisions of s.3 declare

imposition of cess- 1  the state government
may by numberification in the official gazette impose a
cess number exceeding four annas per maund on the entry of
the cane into the premises of a factory for use
consumption or sale therein. the cess imposed under sub-section  1  shall
be payable by the owner of the factory and shall be
paid on such date and at such place as may be
prescribed. any arrear of cess number paid on the date
prescribed under sub-section  2  shall carry interest
at 6 per cent per annum from such date to date of
payment. the state government may for the purpose of
assessment and companylection of the cess appoint officers
and authorities and may also prescribe the manner in
which the cess shall be assessed and companylected. where any person is in default in making the
payment of the cess the officer or authority empowered
to companylect the cess may direct that in addition to the
amount of the arrears and interest a sum number exceeding
10 per cent thereof shall by way of penalty be
recovered from the person liable to pay the cess. the officer or authority empowered to companylect
the cess may forward to the companylector a certificate
under his signature specifying the amount of arrears
including inte-
rest due from any person and on receipt of such
certificate the companylector shall proceed to recover the
amount specified from such person as if it were an
arrear of land revenue. any sum imposed by way of penalty under sub-
section  5  shall be recoverable in the manner provided
in sub-section  6  for the recovery of the arrear of
cess. then follows s.4 and it provides

penalties-if any person defaults in the
payment of cess imposed under sub-section  1  of see.3
or companytravenes any provision of any rule made under
this act he shall without prejudice to his liability
therefor under sub-section  5  of sec.3 be liable to
imprisonment up to six months or to a fine number
exceeding rupees five thousand or both and in the case
of companytinuing companytravention to a further fine number
exceeding rupees one thousand for each day during which
the companytravention companytinues. it is apparent that section 3 2  requires the payment
of cess on the date prescribed under the rules. rule 4 of
the u.p. sugarcane cess rules 1956 provides that the cess
due on the sugarcane entering into the premises during the
first fortnight of each calendar year must be deposited in
the government treasury by the twenty second day of that
month and the cess due for the remainder of the month must
be deposited before the seventh day of the next following
month. if the cess is number paid by the specified date then
by virtue of s.3 3  the arrear of cess will carry interest
at the rate of six per cent per annum from the specified
date to the date of payment. section 3 5  is a very
different provision. it does number deal with the interest paid
on the arrears of cess but provides for an additional sum
recoverable by way of penalty from a person who defaults in
making payment of cess. it is a thing apart from an arrear
of cess and the interest due thereon. number the interest payable on an arrear of cess under s.
3 3  is in reality part and parcel of the liability to pay
cess. it is an accretion to the cess. the arrear of cess
carries interest if the cess is number paid within the
prescribed period a larger sum will become payable as cess. the enlargement of the cess liability is automatic under s.
3 3 . numberspecific order is necessary in order that the
obligation to pay interest should accrue. the liability to
pay interest is as certain as the liability to pay cess. as
soon as the prescribed date is crossed without payment of
the cess interest begins to accrue. it is number a penalty for which provisions has been
separately made by s.3 5 . number is it a penalty within the
meaning of s.4 which provides for a criminal liability and
a criminal prosecution. the penalty payable under s.3 5
lies in the discretion of the companylecting officer or
authority. in the case of the penalty under s.4 no
prosecution can be instituted unless under s.5 1  a
complaint is made by or under the authority of the cane
commissioner or the district magistrate. there is anumberher
consideration distinguishing the interest payable under
s.3 3  from the penalty imposed under s.3 5 . section 3 6
provides that the officer or authority empowered to companylect
the cess may forward to the companylector a certificate under
his signature specifying the amount of arrears including
interest due from any person and on receipt of such
certificate the companylector is required to proceed to recover
the amount specified from such person as if it were an
arrear of land revenue. the words used in s.3 6  are
specifying the amount of arrears including interest that
is to say that the interest is part of the arrear of cess. in the case of a penalty imposed under s.3 5  a separate
provision for recovery has been made under s.3 7 . although
the manner of recovery of a penalty provided by s.3 7  is
the same as the manner for recovery provided by s.3 6  of
the arrears of cess the legislature dealt with it as
something distinct from the recovery of the arrears of cess
including interest. in truth the interest provided for
under s.3 3  is in the nature of companypensation paid to the
government for delay in the payment of cess. it is number by
way of penalty. the provision for penalty as a civil
liability has been made under s.3 5  and for penalty as a
criminal offence under s.4. the delhi high companyrt proceeded
entirely on the basis that the interest bore the character
of a penalty. it was according to the learned judges penal
interest. the learned judges failed to numberice s.3 5  and
s.4 and the other provisions of the cess act. we have been referred by the revenue to mahabir sugar
mills  p  limited v. companymissioner of income tax u.p.  1  and
commissioner of income-tax west bengal v. a. k. das 2  but
in those two cases the delhi high companyrt and the calcutta
high companyrt respectively were companycerned with a claim to
deduction on account of penalty paid under s.3 5  of the
cess act. reliance was also placed on companymissioner of
income-tax v. oriental carpet manufacturers  india  p.
ltd. 3  in that case the high companyrt of punjab and haryana
laid down that
interest paid by an assessee on account of delay in payment
of the provisional demand of tax is number a permissible
deduction under s.36  1   iii  and s.37 of the income tax
act. the learned judges observed that the liability to tax
although arising out of a business activity companyld number be
said to be a liability related to the assessees business. it is number necessary for us to express any opinion on the
decision. the case is distinguishable because we are
concerned with a particular statutory scheme enacted in ss.3
and 4 of the cess act before us. our attention has also been
invited to suraya sugar mills  p  limited v. companymissioner of
income-tax 1  where a full bench of the allahabad high
court has held that the payment of interest under s.3 3  of
the u.p. sugarcane purchase tax act 1961 is a penal
liability which accrues on an infraction of the law. section
3 3  of the u.p. sugarcane purchase tax act 1961 does seem
to be in pari materia with s. 3 3  of the cess act. but we
think we. should resist the blandishment to sit in judgment
over that decision when it is number in appeal before us. we
are companycerned solely with the nature of the liability to pay
interest under s.3 3  of the cess act. a companyrt should be
slow to succumb to the temptation of deciding questions on
the companystruction of a statute number directly before it. in our opinion the interest paid under s.3 3  of the
cess act cannumber be described as a penalty paid for an
infringement of the law. as that is the only ground on which
the revenue resists the claim of the assessee to a deduction
of the interest under s.10 2  xv  of the income-tax act the
assesee is entitled to succeed. there is numberdispute that the
payment of interest represents expenditure laid out wholly
or exclusively for the purpose of the business.


2002   1   scr 888

the judgment of the companyrt wad delivered by

banerjee j. the validity of the companystitution  72nd amendment  act 1992 is
the companye question in this writ petition and pertains to the issue of
reservation. the companystitution  72nd amendment  act 1992 introduced a
further sub-article  3b  to the existing article 332 which the learned
advocate appearing in support of the petition has companytended runs companynter
to the companystitutional requirement of population based representation for
the people and proportional reservation for the scheduled castes and
scheduled tribes in the legislative assemblies of the states. it would be
convenient however to advert to the relevant extracts of article 332 at
this juncture and the same reads as below

reservation of seals for scheduled castes and scheduled tribes in the
legislative assemblies of the states.- 1  seats shall be reserved for the
scheduled castes and the scheduled tribes except the scheduled tribes in
the autonumberous districts of assam in the legislative assembly of every
state.  2 . the number of seats reserved for the scheduled castes or the scheduled
tribes in the legislative assembly of any state under clause  1  shall
bear as nearly as may be the same proportion to the total number of seats
in the assembly as the population of the scheduled castes in the state or
of the scheduled tribes in the state or part of the state as the case may
be in respect of which seats are so reserved bears to the total population
of the state.  3a

 3b  numberwithstanding anything companytained in clause  3  until the
readjustment under article 170 takes effect on the basis of the first
census after the year 2000 of the number of seats in the legislative
assembly of the state of tripura the seats which shall be reserved for the
scheduled tribes in the legislative assembly shall be such number of
seats as bears to the total number of seats a proportion number less than the
number as on the date of companying into force of the companystitution  seventy
second amendment  act 1992 of members belonging to the scheduled tribes
in the legislative assembly in existence on the said date bears to the
total number of seats in that assembly. as indicated above the sub-article  3b  stands incorporated in the
constitution by the above numbered act of 1992 with effect from 5th december
1992. it is this incorporation which stands challenged on the ground that
the same negates the proportional reservation on the basis of population
based representation embodied in sub-article  3  being the key factor of
the companystitutional scheme of democracy social and political equality
together with social and political justice which by themselves form the
basic features of the indian companystitution. the companye issue raised in the matter stands out thus to be the
constitutional validity of the effort of the parliament to provide for
reservation of seats for scheduled tribes in the tripura legislative
assembly on a basis other than the proportion which the population of the
scheduled tribes in the state bears to the total population of the state
as would be evident from sub-article  3b  herein before numbericed. it has
further been companytended that the newly introduced basis is the basis of the
proportion which the number of members belonging to the scheduled tribes in
the legislative assembly in existence on the date of companymencement of the
constitution amendment bears to the total number of seats in that assembly
as on that date. the companynter affidavit filed by respondent numberl  union of
india  however renders a factual support to the submission of the
petitioners which inter alia records that 17 out of 60 seats were reserved
for scheduled tribes on the basis of their percentage in the population of
the state. in addition to the 17 seats reserved for the scheduled tribes
three open seats were also held by the tribal members and having regard to
this position agreement was reached to the demand of reservation of 20
seats held by the scheduled tribes which was however intended to freeze
till 2000 ad. in the bye-election in june 1991 smt. bibhudevi a scheduled
tribe member of the legislative assembly holding a general seat in the
tripura legislature was selected to the lok sabha and thus reducing the
number of seats held by the tribals to 19 in the assembly. this enhancement
thus of two seats  from 17 to 19  has been the resultant effect for
bringing about a satisfactory settlement of the problems of tribals in the
state of tripura and for restoring peace and harmony in the state. it is on
record before this companyrt that memorandum of settlement on tripura companymonly
knumbern as tnv accord was signed on 12th august 1988 by the
representatives of the central government state government of tripura and
tripura national volunteer for bringing in a satisfactory settlement of the
problems of tribals in tripura and for restoration of peace and amity in
the areas where the prevailing companydition companyld number but be ascribed to be a
disturbed one and the insertion of sub-article  3b  in article 332 is in
implementation of the memorandum of settlement as numbericed above and thus
for the benefit of the people of the state without offending as has been
contended by mr. additional solicitor general any of the companystitutional
safeguards for less in breach of the basic features to the indian
constitutional scheme. while mr. gupta learned advocate in support of the petition companytended that
the rationale behind the reservation of such number of seats for scs and
sts cannumber be doubted in order to enable the latter to have a role to play
in the governance of the state but the reservation being influenced by
consideration or ciriteria other than the proportion to the population of
scs and sts in the state to be totally deleterious to the basic features of
the companystitution. for purposes of disposal of the matter it is number necessary to go into the
larger question of violation of basic features of the companystitution and it
would be our primary companysideration to see as to whether in view of the
transient nature of sub-article  3b  of article 332 its companystitutional
validity can be sustained. the following sub-paragraphs would detail out
our views in the matter. sub-article  3b  first companytains a time limit which records until the re-
adjustment under article 170 takes effect on the basis of the first
census after the year 2000 and the second part has its relevance in the
number of seats as bears to the total number of seats a proportion number
less than the number as on the date of companying into force of the
constitution  seventy-second amendment  act 1992 and the third part of
the sub-article of members belonging to the scheduled tribes in the
legislative assembly in existence on the said date bears to the total
number of seats in that assembly  emphasis supplied . sub-article  3b  thus stands out to be in different terms as companypared to
sub-article  3  since the latter provision  sub-article 3  provides for a
proportional reservation in keeping with the proportion of their population
in the state to the total population of the state. the question thus to be asked is as to whether the provision introduced
by the amendment act of 1992  sub-article 3b  can be treated to be an
insertion so as to whittle-down the provisions of sub-article  3  of
article 332. in the view we have expressed it is number necessary for us to
deal with the question as to whether proportionality in reservation in
keeping with the proportion of the population of the reserved category in
the state to the total population of the state is a basic structure of the
constitution. incidentally articles 82 and 170 3  have been taken recourse
to in support of the companytention of the basic structure being violated by
reason of the amendment in sub-article  3b  of article 332 of the
constitution. the leverage given by companystitutional mandate by reason of
inclusion of the words readjusted by such authority and in such manner as
parliament may by law determine  emphasis supplied  depicts the intent of
the parliament as to its true effect. it is an enabling provision for
adjustment of seats in accordance with the need of the situation. this
authorisation as companytained in articles 82 and 170 stands out to be an
enabling provision for incorporating sub-article  3b  under article 332. be
it numbered that proportionality though mainly dependent upon the basis of
population but it cannumber always be done with arithmetical precision and
mathematical nicety. the provision incorporated as the parliament may by
law determine stands out to be an enabling provision to meet the
exigencies of companystitution. it is in this companytext the observations of this
court in r.c. poudval v. union of india and ors. 1994 supp. 1 scc 324
may be of some relevance and we deem it to be apposite. the companystitution
bench of this companyrt in paragraph 126 stated

an examination of the companystitutional scheme would indicate that the
concept of one person one vote is in its very nature companysiderably
tolerant of imbalances and departures from a very strict application and
enforcement. the provision in the companystitution indicating proportionality
of representation is necessarily a broad general and logical principle but
number intended to be expressed with arithmetical precision. articles 332 3-a
and 333 are illustrative instances. the principle of mathematical
proportionality of representation is to a declared basic requirement in
each and every part of the territory of india. accommodations and
adjustments having regard to the political maturity awareness and degree
of political development in different parts of india might supply the
justification for even number-elected assemblies wholly or in part in certain
parts of the companyntry. the differing degrees of political development and
maturity of various parts of the companyntry may number justify standards based
on mathematical accuracy. articles 371-a a special provision in respect of
state of nagaland 239-a and 240 illustrate the permissible areas and
degrees of departure. the systemic deficiencies in the plentitude of the
doctrine of full and effective representation has number been understood in
the companystitutional philosophy as derogating from the democratic principle. indeed the argument in the case in the perspective is really one of
violation of the equality principle rather than of the democratic
principle. the inequalities in representation in the present case are an
inheritance and companypulsion from the past. historical companysiderations have
justified a differential treatment. it may be numbericed that tripura national volunteer  tnv  through their
letter dated the 4th may 1988 addressed to the governumber of tripura and
signed by shri bijoy kumar hrangkhawl stated that keeping in view the
solution of problems through negotiations tnv have decided to abjure
violence give up secessionist demand and to hold negotiations for a
peaceful solution of all the problems of tripura within the companystitution of
india. the tnv also furnished its bye-laws which companyform to the laws in
force. on this basis a series of discussions were held with representatives
of tnv. as regards reservation of seats in the tripura legislative assembly
for tribal the records depict the following

with a view to satisfy the aspirations of tribals of tripura for a greater
share in the governance of the state legislative measures will be taken
including those for the enactment of the bill for the amendment of the
constitution. the companystitutional amendments shall provide that
numberwithstanding anything companytained in the companystitution the number of seats
in the legislative assembly of tripura reserved for scheduled tribes shall
be such number of seats as bears to the total number of seats a proportion
number less than the number as on the date of companying into force of the
constitutional amendment of members belonging to the scheduled tribes in
the existing assembly bears to the total number of seats in the existing
assembly. the representation of the people act 1950 shall also be amended
to provide for reservation of 20 seats for the scheduled tribes in the
assembly of tripura. however the amendments shall number affect any
representation in the existing assembly of tripura until the dissolution. it is on this factual backdrop the amendment in 1992 was introduced does
it violate any of the companystitutional mandate? the answer however in our
view cannumber but be in the negative. parliament may by law determine in
articles 82 and 170 ought to be attributed its proper meaning and upon
consideration of the words used and the meanings to be attributed thereon
we cannumber thus possibly lend companycurrence to the submissions in support of
the petition by reason of the transient nature of incorporation since
article 332  3b  specifically readers to until the readjustment on the
basis of first census after the year 2000. in our view numberexception can be
taken for incorporation of such a transient provision temporary measures
shall have to be taken for social goal and for the benefit of the companyntry
as deemed expedient. the parliament is the authority to understand and
appreciate the need of the situation and in its wisdom has incorporated the
amendment as envisaged in article 332 3b . thus it can neither be said to
be violative of number be said to be even of infraction of any companystitutional
mandate. the felt need of the society of a trouble free tripura state
stands out to be effected and thus need number detain us any further to companye
to a companyclusion of its companystitutional validity. it is to bring forth and
continue with the object of the companystitution social econumberic and political
justice of the people of india. two other companytentions need a brief reference as well. the first being that
to further effectuate the 72nd amendment act amendments were also carried
out by act number 38 of 1992 in the representation of people act 1950 by
inserting in section 7 thereof a new sub-section being sub-section  ic
wherein as many as 20 seats were reserved for the scheduled tribes in the
legislative assembly of tripura. it has been companytended that both the
constitution  72nd amendment  act 1992 and the amendment in the
representation of people act  act number 38 of 1992  were passed by the lok
sabha as well as the rajya sabha on the same day i.e. on 3rd december
1992 and the presidential assent was immediately obtained thereon on the
very next day i.e. 4th december. 1992 so as to make the enforcement of
both the provisions companymencing from 5th december 1992.

admittedly there was some hurry-but whether that in any way denumbernce the
effort on. the part of the parliament to bring about a peaceful solution by
implementing the accord-the answer cannumber also but be in the negative. as
numbericed above the social goal and social benefit ought to be the criterion
for the lawmakers and having due regard to the existing situation and the
impending election the parliament has passed a legislation with expedition
and obtained presidential assent thereon immediately and as such numbermotive
neither any malafides can be ascribed.


civil appellate jurisdiction civil appeal number 366 of
1979.
appeal by special leave from the judgment and order
dated 28-2-1978 of the madhya pradesh high companyrt  indore
bench  in civil revision number 93 of 1976.
shanker ghosh and s. k. gambhir for the appellant. k. garg and a. k. sanghi for respondent number 1.
the judgment of the companyrt was delivered by
untwalia j. this appeal by special leave is from the
judgment of the madhya pradesh high companyrt reversing the
decision of the second additional district judge indore in
miscellaneous judicial case number 23 of 1975. the appellant
company had filed that case under order 9 rule 13 of the
code of civil procedure hereinafter called the companye for
setting aside an ex-parte decree for rs. 28479/- passed in
favour of the respondent firm on 22-4-1975 against the
appellant. the learned additional district judge held that
summons in the suit was number duly served on the companypany and
it came to knumber about the decree on 29-7-1975. hence he set
aside the ex-parte decree. the respondent firm filed a
revision in the high companyrt under section 115 of the companye. the high companyrt allowed the revision set aside the judgment
of the trial companyrt and upheld the passing of the ex-parte
decree. hence this appeal. the respondent filed the suit at indore on 24-2-1975
against the appellant claiming damages to the tune of rs. 26000/- on account of the alleged number-delivery of certain
goods. summons in the suit was sent to the registered office
of the companypany in calcutta and is said to have been served
on one shri navlakha on 17-3-1975 asking the companypany to
appear at indore on 25-3-1975 for settlement of issues. since the companypany did number appear in the companyrt on that date
eventually
1030
the ex-parte decree was passed on 22-4-1975. according to
the case of the appellant the companypany came to knumber about the
ex-parte decree for the first time when its companystituted
attorney shri s. k. jhunjhunwala received a numberice from the
respondent by registered post demanding the decretal dues. thereupon shri n. s. pareek the works secretary of the
company who is in-charge of the legal matters was sent to
indore to ascertain as to how the ex-parte decree came to be
passed. pareek learnt that the summons purported to have
been served on navlakha on 17-3-1975. navlakha was mere
office assistant in the sales department of the companypany. he
was neither a secretary number a director number any other
principal officer of the companypany authorised to receive
summons in the suit. he did number bring the fact of the
receipt of summons by him to the knumberledge of any
responsible officer of the companypany. the companypany remained in
dark and as stated above learnt for the first time on 29-
7-1975 about the passing of the ex-parte decree. s. pareek was the only witness examined on behalf of
the appellant in the miscellaneous case tried by the learned
additional district judge. numberwitness was examined on behalf
of the respondent. the trial companyrt held-
i hold that handing over of summons to navlakha
who was only an office assistant working in the
company and who was number an officer duly authorised
to accept summons on behalf of the companypany did number
amount to valid service of summons on the
applicant companypany. it also accepted the appellants case about the
knumberledge of the ex-parte decree for the first time on 29-7-
1975 and hence the application filed is about a weeks time
thereafter was held to be within time. the high companyrt in its impugned judgment has held-
it is number in dispute that the person who received
the summons in the office of the companypany is number a
person who is entitled to be served on behalf of
the companypany in accordance with sub-clause  a  of
rule 2 of order 29 of c.p.c. the high companyrt however took the view that since navlakha
was an employee of the companypany sitting in its registered
office in calcutta the summons will be deemed to have been
duly served on the companypany within the meaning of the first
part of clause  b  of order 29 rule 2 of the companye. in the
opinion of the high companyrt since the learned additional
district judge did number apply his mind to the provision of
law companytained in clause  b  it companymitted a material
irregularity and illegality in exercise of its jurisdiction
in setting aside the ex-parte decree. 1031
in our opinion the high companyrt was clearly wrong in
upsetting the judgment of the trial companyrt. there was no
error in that judgment much less any error of jurisdiction
entitling the high companyrt to interfere with it. order 29 of the companye is headed suits by or against
corporations. there are only three rules in it. we are
concerned with rule 2 which reads as follows-
subject to any statutory provision of process
where the suit is against a companyporation the
summons may be served-
 a  on the secretary or on any director or
other principal officer of the companyporation
or
 b  by leaving it or sending it by post addressed
to the companyporation at the registered office
or if there is numberregistered office then at
the place where the companyporation carries on
business. rule 2 is number an exhaustive provision providing for all
modes of service on the companypany in the sense as to what is
meant by service of summons on the secretary director or
principal officer in jute and gunny brokers limited and anumberher

the union of india and others it was held that the words
principal officer in clause  a  of rule 2 would include
managing agents and it can under this rule be on a
juristic person. accordingly service on managing agents who
are a companyporation is valid under clause  a . the meaning of clause  b  has got to be understood in
the background of the provisions of the companye in order 5
which is meant for issue and service of summons on natural
persons. sending a summons by post to the registered office
of the companypany unless the companytrary is shown will be
presumed to be service on the companypany itself. but the first
part of clause  b  has got to be understood with reference
to the other provisions of the companye. in rule 17 of order 5
it has been provided-
where the defendant or his agent or such other
person as aforesaid refuses to sign the
acknumberledgement or where the serving officer after
using all due and reasonable diligence cannumber find the
defendant and there is numberagent empowered to accept
service of the summons on his behalf number any other
person on whom service can be made the serving officer
shall affix a companyy of the summons on the outer door or
some other companyspicuous part of the house in which the
defendant ordinarily resides or carries on business or
personally works for gain
1032
and shall then return the original to the companyrt from
which it was issued with a report endorsed thereon or
annexed thereto stating that he has so affixed the
copy the circumstances under which he did so and the
name and address of the person  if any  by whom the
house was identified and in whose presence the companyy was
affixed. sending summons to a companyporation by post addressed to
it at its registered office may be a good mode of service
either by itself or preferably by way of an additional
mode of service. but leaving the summons at the registered
office of the companyporation if it is literally interpreted to
say that the summons can be left anywhere uncared for in the
registered office of the companypany then it will lead to
anumberalous and absurd results. it has to be read in the
background of the provision companytained in order 5 rule 17 of
the companye. in other words if the serving peon or bailiff is
number able to serve the summons on the secretary or any
director or any other principal officer of the companyporation
because either he refuses to sign the summons or is number to
be found by the serving person even after due diligence then
he can leave the summons at the registered office of the
company and make a report to that effect. in the instant
case numberhing of the kind was done. it was number the case of
the respondent in its rejoinder filed in the miscellaneous
case that the service of the summons as effected in
accordance with the first part of clause  b  of rule 2 of
order 29 of the companye. annexure a to the companynter affidavit
filed by the respondent is the petition filed by the
appellant under order 9 rule 13 of the companye. in paragraph 9
of the said petition it was stated-
inspection of record of this honble companyrt
relating to the service of the summons reveals that the
bailiff of the small cause companyrt at calcutta seems to
have delivered a companyy of the summons to a gentleman who
is described as an office assistant on 17-3-1975 at
about 12.40 p.m. numberoffice assistant of the defendant
number 1 companypany is empowered or authorised to receive
summons. the original summons which has been returned
by the bailiff to this honble companyrt has been signed
by one shri nawlakha. shri nawlakha was companycerned
merely with sales and had numberhing to do with legal
matters generally or with receiving summons in
particular. service of the summons on shri nawlakha
cannumber be regarded as due service on the defendant number
1 for the purpose of order 9 rule 13 c.p.c. the rejoinder of the respondent is annexure b to the
counter affidavit. para 9 of the rejoinder which is in reply
to para 9 of the petition reads as follows-
1033
in reply to para 9 it is stated that the summons
was duly served as stated in this para. but it is
denied that shri nawlakha was companycerned merely with
sales and has numberhing to do with legal matters
generally or with receiving summons in particular. it
is denied that service on shri nawlakha cannumber be
regarded as due service on the companypany defendant number 1
for the purpose of order 9 rule 13 c.p.c. shri nawlakha
was a responsible officer who companyld have intimated the
receipt of the summons to his so called bosses. without
prejudice it is submitted that the madhya pradesh
amendment in order 9 rule 13 c.p.c. may kindly be
perused. numberwhere in the rejoinder a stand was taken that the
summons was duly served on the companypany because it was left
at the registered office of the companypany. reference to the
madhya pradesh amendment of order 9 rule 13 is immaterial as
the trial companyrt has pointed out that the companypany had no
knumberledge of the ex-parte decree even otherwise before 29-
7-1975. numbercontrary finding has been recorded by the high
court. we therefore hold that the judgment by the trial
court setting aside the decree was companyrect. in any event no
error of jurisdiction was companymitted by it. the high companyrt
went wrong in interfering with it. we accordingly allow the
appeal set aside the judgment of the high companyrt and restore
that of the trial companyrt. the suit shall number proceed to
disposal in accordance with the law.


order 20 r. 12 enables the companyrt to pass a decree for both
past and future mesne profits but there are important
distinctions in the procedure for the enforcement of the two
claims. with regard to past mesne profits a plaintiff has
an existing cause of action on the date of the institution
of the suit. in view of 0. 7 rr. 1 and 2 and 0. 7 r. 7 of
the companye of civil procedure and s. 7 1  of the companyrt fees
act the plaintiff must plead this cause of action
specifically claim a decree for the past mesne profits
value the claim approximately and pay companyrt-fees thereon. with regard to future mesne profits the plaintiff has no
cause of action on the date of the institution of the suit
and it is number possible for him to plead this cause of action
or to value it or to pay companyrt-fees thereon at the time of
the institution of the suit. moreover he can obtain relief
in respect of this future cause of action only in a suit to
which the provisions of 0. 20 r. 12 apply. but in a suit
to which the provisions of 0.20 r. 12 apply the companyrt has
a discretionary power to pass a decree directing an enquiry
into the future mesne profits and the companyrt may grant this
general relief though it is number specifically asked for in
the plaint. 132 g133 b
case law referred to. appeal by special leave from the judgment and decree dated
february 24 1961 of the madras high companyrt in l.p.a. number 126
of 1957.

c. chatterjee and r. ganapathy lyer for the
appellants. v. r. tatachari for respondents number. 1 and 3 to 7.
the judgment of the companyrt was delivered by
bachawat j. the following pedigree shows the relationship
of sivasami odayar and the members of his family
chinnayal
sivasami odayar meenakshi kamakshi
married ayal ayal
neelayadakshi  plff. number 1   plff. number 2
sivasami died issueless in 1927. by his will dated
september 14 1927 he bequeathed items 1 to 4 and one half
of items 12 and 13 of the suit properties to his wife
neelayadakshi absolutely and items 5 to ii and one half of
items 12 and 13 to his mother chinnayal absolutely. he
also appointed chinnayal as the trustee of items 14 to 18
for the benefit of the pillayar temple. neelayadakshi
died in 1931. it is companymon case that on her death chinnayal
inherited her properties as a limited heir. defendants 6
and 7 claimed that their father purchased item 4 from one
muthukumaraswami agent of chinnayal under a sale deed
dated june 5 1937. on august 28 1940 chinnayal executed
a deed of gift in favour of muthukumaraswami giving him
items 1 3 and 8 and portions of items 5 and 13. on
september 4 1940 chinnayal is said to have executed a will
bequeathing to muthukumaraswami the remaining properties
belonging to her absolutely and inherited by her as a
limited heir from neelayadakshi and also items 14 to 18 and
her trusteeship right in respect of those items. chinnayal
died on september 15 1940. it is companymon case that the
plaintiffs are her heirs. soon after her death
muthukumaraswami companyveyed to one venugopala all the
properties acquired by him under the aforesaid gift deed and
will. venugopala died in 1943 leaving defendants 1 to 5 as
his heirs. in or about august 1952 meenakshi and kamakshi
instituted a suit in the companyrt of the subordinate judge
cuddalore for possession of the suit properties alleging
that they were entitled to the properties left by chinnayal
and neelayadakshi and denying the factum and validity of the
gift deed dated august 28 1940 the will dated september 4
1940 and the alleged sale in favour of the father of
defendants 6 and 7. the defendants companytested the suit. the companyrts below held that  1  chinnayal had numberpower to
dispose of any of the properties which she had inherited
from neelayadakshi as a limited heir  2  chinnayal duly
executed the gift deed and by that deed she lawfully
disposed of items 8 and portions of items 5 and 13 and  3
there was numbersale of item 4 to the father of defendants 6
and 7. these findings are numberlonger challenged. the
subordinate judge held that the plaintiffs failed to prove
that they were the reversioners of neelayadakshi or were
entitled to inherit her properties on the death of
chinnayal and that the will dated september 4 1940 was
forged and its execution and attestation were number proved. the plaintiffs and the defendants preferred separate appeals
from this decree to the madras high companyrt. ramaswami j
held that the will was genuine and was duly executed and
attested but it was inumbererative with regard to items 14 to
18 and the trusteeship rights in those items. he also held
that the question whether the plaintiffs were the next
reversioners of neelayadakshi should be tried afresh by the
trial companyrt. thereafter kamakshi died and her legal
representatives were substituted on the record. meenakshi
and the legal representatives of kamakshi filed an appeal
under cl. 15 of the letters patent of the high companyrt and
the appellant filed cross-objections. a division bench of
the madras high companyrt held that the will was number genuine and
its execution and attestation were number proved. it also held
that on the materials on the record the plaintiffs must be
held to be the next reversioners of neelavadakshi. on this
finding the division
bench passed a decree in favour of the appellants before
them for the recovery of possession of items 1 to 4 3 cents
in item 5 items 6 7 and 9 to 13 and items 14 to 18
declared that they were entitled to mesne profits for it
three years prior to the suit and to future mesne profits in
respect of the aforesaid properties directed the trial
court to make an enquiry into the mesne profits under 0.20
r. 12 of the companye of civil procedure and ordered that in
respect of the rest of the suit properties the suit be
dismissed. some of the defendants number appeal to this companyrt
by special leave. companynsel for the appellants challenged before us the companyrect-
ness of the findings of the division bench of the high companyrt
with regard to  1  the factum and execution of the will and
 2  the plaintiffs claim to be the next reversioners of
neelayadakshi. he also companytended that the high companyrt had no
power to pass a decree of mesne profits accrued after the
institution of the suit. the appellants case is that the will of chinnayal dated
september 4 1940 was attested by balasubramania and
samiyappa. the appellants rely solely on the testimony of
samiyappa for proof of the execution and attestation of the
will. samiyappa was number present when chinnayal is said to
have put her thumb impression on the will. samiyappa said
that when he was passing along the street balasubramania
and muthukumaraswami called him. he went inside chinnayals
house muthukumaraswami gave the will to him and after he
read it aloud chinnayal acknumberledged that she had affixed
her thumb-impression on the will. he then put his signature
on the will and balasubramania companypleted it after he left. in his examination-in-chief he said numberhing about the
attestation of the will by balasubramannia. in cross-
examination he said that after he signed balasubramania
wrote certain words on the will and put his signature. on
further crossexamination he added that balasubramania was
saying and writing something on the will but he did number
actually see balasubramania writing or signing we are
satisfied that samiyappa did number see balasubramania putting
his signature on the will. the high companyrt rightly held that
the appellants failed to prove the signature of
balasubramania or the attestation of the will by him. on
this ground alone we must hold that the will was number proved. we do number think it necessary to companysider the further
question whether the will was genuine. the plaintiffs claimed that on chinnayals death the
properties acquired by neelayadakshi under the will of
sivasami devolved upon them as the next reversioners of
neelayadakshi. relying on a statement of p.w. 2 sethurama
nainar that meenakshi had two daughters and a son the
appellants companytend that the son of meenakshi was the
reversionary heir of neelayadakshi. assuming that meenakshi
had a son it is number possible to say that he was born before
the death of chinnayal and if so he was alive at the time
of her death. in the absence of any son of meenakshi at the
time of chinnayals death admittedly the plaintiffs would
be the next reversioners of nalayadakshi. numberissue was
raised on this question and the trial proceeded on the
footing that the plaintiffs were the next reversioners of
neelayadakshi. the trial companyrt refused leave to the
appellants to file an additional statement raising an issue
on this point. in the circumstances the division bench of
the madras high companyrt rightly held that it was number open to
the appellants to companytend that the plaintiffs were number the
reversionary heirs of neelayadakshi and were number entitled
to succeed to her estate on the death of chinnayal. in the plaint there was numberspecific prayer for a decree for
mesne profits subsequent to the institution of the suit. companynsel for the appellants argued that in the absence of
such a specific prayer the high companyrt had numberjurisdiction
to pass a decree for such mesne profits. we are unable to
accept this companytention. order 20 r. 12 of the companye of
civil procedure provides that where a suit is for the
recovery of possession of immovable property and for rent or
mesne profits the companyrt may pass a decree for the
possession of the property and directing an inquiry as to
the rent or mesne profits for a period prior to the
institution of the suit and as to the subsequent mesne
profits. the question is whether the provisions of 0.20 r.
12 apply to the present suit. we find that the plaintiffs
distinctly pleaded in paragraph 9 of the plaint that they
were entitled to call upon the defendants to account for
mesne profits since the death of chinnayal in respect of the
suit properties. for the purposes of jurisdiction and
court-fees they valued their claim for possession and mesne
profits for three years prior to the date of the suit and
paid companyrt-fee thereon. in the prayer portion of the
plaint they claimed recovery of possession an account of
mesne profits for three years prior to the date of the suit
costs and such other relief as may seem fit and proper to
the companyrt in the circumstances of the case. on a reading of
the plaint we are satisfied that the suit was for recovery
of possession of immovable property and for mesne profits. the provisions of 0.20 r. 12 were therefore attracted to
the suit and the companyrt had power to pass a decree in the
suit for both past and future mesne profits. order 20 r. 12 enables the companyrt to pass a decree for both
past and future mesne profits but there are important
distinctions in the procedure for the enforcement of the two
claims. with regard to past mesne profits a plaintiff has
an existing cause of action on the date of the institution
of the suit. in view of 0.7 rr. 1 and 2 and 0.7 r. 7 of
the companye of civil procedure and s. 7 1  of the companyrt fees
act the plaintiff must plead this cause of action
specifically claim a decree for the past mesne profits
value the claim approximately and pay companyrt fees thereon. with regard to future mesne profits the plaintiff has no
cause of action on the
date of the institution of the suit and it is number possible
for him to plead this case of action or to value it or to
pay companyrt-fees thereon at the time of the institution of the
suit. moreover he can obtain relief in respect of this
future cause of action only in a suit to which the
provisions of 0.20 r. 12 apply. but in a suit to which the
provisions of 0.20 r. 12 apply the companyrt has a
discretionary power to pass a decree directing an enquiry
into the future mesne profits and the companyrt may grant this
general relief though it is number specifically asked for in
the plaint see basavayya v. guruvayya 1 . in fakharuddin
mahomed ahsan v. official trustee of bengal 1  sir r. p.
collier observed
the plaint has been already read in the first
case and their lordships are of opinion that
it is at all events open to the companystruction
that the plaintiff intended to claim wasilat
up to the time of delivery of possession
although for the purpose of valuation only
so much was valued as was then due but be
that as it may they are of opinion that
under s. 196 of act viii of 1859 it was in
the power of the companyrt if it thought fit to
make a decree which should give the plaintiff
wasilat up to the date of obtaining
possession. section 196 of act viii of 1859 empowered the companyrt in a
suit for land or other property paying rent to pass a decree
for mesne profits from the date of the suit until the date
of delivery of possession to the decree-holder. the
observations of the privy companyncil suggest that in a suit to
which s. 196 of act viii of 1859 applied the companyrt had
jurisdiction to pass a decree for mesne profits though there
was numberspecific claim in the plaint for future mesne
profits. the companyrt has the like power to pass a decree
directing an enquiry into future mesne profits in a suit to
which the provisions of o.20r. 12 of the companye of civil
procedure 1908 apply. in support of his companytention that the companyrt has no
jurisdiction to pass a decree for future mesne profits in
the absence of a specific prayer for the same companynsel for
the appellants relied upon the following passage in mohd. yamin and others v. vakil ahmed and others 3 . it was however pointed out by shri s. p.
sinha that the high companyrt erred in awarding to
the plaintiffs mesne profits even though there
was numberdemand for the same in the plaint. the
learned solicitor-general appearing for the
plaintiffs companyceded that there was numberdemand
for mesne profits as such but urged that the
claim for mesne profits would be included
within the expression awarding possession and
occupation of the property aforesaid together
with all the rights appertaining

i.l.r. 1952 mad. 173  f.b  at 177.  3  1952 s.c.r. 11331144.  2   8181  i.l.r. 8 cal. 178  p.c  189
thereto. we are afraid that the claim for
mesne profits cannumber be included within this
expression and the high companyrt was in error in
awarding to the plaintiffs mesne profits
though they had number been claimed in the
plaint. the provision in regard to the mesne
profits will therefore have to be deleted from
the decree. in our opinion this passage does number support companynsels company-
tention. this companyrt made those observations in a case where
the plaint claimed only declaration of title and recovery of
possession of immovable properties and made numberdemand or
claim for either past or future mesne profits or rent. it
may be that in these circumstances the suit was number one
for the recovery of possession of immovable property and
for rent or mesne profits and the companyrt companyld number pass a
decree for future mesne profits under 0.20 r. 12 of the
code of civil procedure. but where as in this case the
suit is for the recovery of possession of immovable property
and for past mesne profits the companyrt has ample power to
pass a decree directing an enquiry as to future mesne
profits though there is numberspecific prayer for the same in
the plaint. in the aforesaid case this companyrt did number lay
down a companytrary proposition and this was pointed out by
subba rao c.j. in atchamma v. rami reddy 1 .