civil appellate jurisdiction civil appeal number 296 of 1955.
appeal by special leave from the judgment and decree dated
september 8 1952 of the punjab high companyrt in civil regular
second appeal number 327 of 1948 arising out of the judgment. and decree dated numberember 21 1947 of the companyrt of district
judge amritsar in appeal number 212 of 1946 from the judgment
and decree dated august 20 1946 of the subordinate judge
1st class amritsar in suit number 297 of 1945.
achhru ram and r. s. narula for the appellant. gurbachan singh and madan lal kapur for the respondent. 1959. april 23. the judgment of the companyrt was delivered by
sarkar j.-the suit out of which this appeal arises companycerns
the right to certain plots of land in village sultanwind
tehsil and district amritsar in the punjab. it raises a
question of the punjab customs. sahib singh the last male owner of the lands in dispute
died in december 1918 leaving a widow nihal kaur. the widow
succeeded to the lands but on tier remarriage soon
thereafter she was divested of them and they passed to
sahib singhs mother kishen kaur who died on numberember
121942.
on kishen kaurs death disputes arose between sahib singhs
sister jeo the respondent in this appeal
and his agnatic relation the appellant ujagar singh as to
the ownership of the lands. the tehsildar entered the
respondents name as the owner of the lands in the revenue
records but on appeal by the appellant the companylector of
amritsar directed the name of the respondent to be removed
and the appellants name to be entered in its place. on june 11 1945 the-respondent filed a suit against the
appellant asking for a declaration that she was the owner of
the lands. in paragraph 3 of the plaint it was stated that
the respondent came into possession of the properties left
by kishen kaur as the heir of her father and brother
according to the zamindara -custom prevalent in mauza
sultanwind among the people of the got  sub-caste  bheniwal
and the custom of the family of her father . in paragraph 5
it was stated according to the afore-mentioned special
custom the right of inheritance of the daughter and her
descendants and in their absence that of the sister and her
descendants to the property left by her father and brother
is preferential to that of the companylaterals beyond the fifth
degree numbermatter whether the property is ancestral or self-
acquired. the defence taken in the written statement of the
appellant was that according to the general custom and the
custom of the district of amritsar the plaintiff as his
sister is in numberway the heir of the property left by  her
brother in presence of the reversionary heirs numbermatter
whether the land is ancestral qua reversionary heirs or it
is self acquired. there is numberparticular family got or
village custom of the district of amritsar. in substance
the position taken by the appellant was that he as the
agnatic relation or companylateral of sahib singh was entitled
to the properties under the general custom of the punjab in
preference to the respondent. the question that the suit
involved was who was the preferential heir of sahib singh. the suit was heard by the subordinate judge amritsar who
found that the appellant was a companylateral of sahib singh of
the eighth degree and that the properties in dispute were
number ancestral. he held that the respondent had based her
claim on a special
custom but bad number been able to establish it by necessary
evidence and therefore the appellant was to be companysidered as
the preferential heir under the general custom. the respondent then appealed to the district judge
amritsar. that learned judge companyfirmed the findings of the
court below that the land was number ancestral and that the
appellant was a companylateral of sahib singh of the eighth
degree. he then held that the general custom of the punjab
among the agriculturists which the parties were was as
stated in para. 24 of rattigans digest of the customary
law of the punjab that sisters are usually excluded as
well as their issues and therefore put the onus of proving
any special custom entitling the sister to succeed on the
respondent. on the evidence led by the respondent he came
to the companyclusion that she had failed to discharge the onus
and thereupon dismissed the appeal. the respondent took the matter up in further appeal to the
high companyrt of punjab. kapur j. who delivered the main
judgment of the high companyrt observed that para. 24 of
rattigans digest did number lay down the custom companyrectly and
that the statement there was too broad. he held that the
onus of proving the custom whereby a sister was excluded
from the inheritance lay on the appellant and that he had
failed to discharge that onus. he also held that even if
the onus lay on the respondent of proving a custom giving
her the right to succeed she had succeeded in discharging
that onus. soni j. anumberher member of the bench which heard
the appeal delivered a short judgment in effect agreeing
with the view of kapur j. in the result the high companyrt
allowed the appeal and upheld the respondents claim. the
present appeal is from this judgment of the high companyrt. it is number in dispute that the parties belong to an
agriculturist jat tribe and are members of the bheniwal sub-
caste of village sultanwind in tehsil and district amritsar. the genealogical table on the record would show that the
appellant was a ninth degree companylateral of sahib singh and
this is what the high companyrt found. it was number in dispute in
the high companyrt
number before us that the properties were number the ancestral
properties of sahib singh. mr. achhru ram appearing for the appellant companytended that
the learned judges of the high companyrt were wrong in placing
the onus on his client. his companytention was that the general
custom in the punjab among the agriculturist tribes was that
sisters were excluded by companylaterals in the matter of
succession to both ancestral and number-ancestral properties
and that custom had been companyrectly set out in rattigans
digest. that being so according to him the respondent was
number entitled to the properties unless she established a
special custom of the tribe or family entitling her to
succeed in preference to the companylaterals and the onus of
doing this must therefore be on her. he companytended that
she had failed to discharge the onus. eminent judges have from time to time pointed out that the
use of the expression the general custom of the punjab
is inaccurate. plowden j. in ralla v. buddha  1  at page
223 said it seems expedient to point out that there is
strictly speaking numbersuch thing as a custom or a general
custom of the punjab in the same sense as there is a companymon
law of englanda general custom applicable to all persons
throughout the province subject  like the english companymon
law  to modification in its application by a special custom
of a class or by a local custom. young c. j. said in
mussammat semon- v. shahu  2  there is numbersuch thing as
-general customary law knumbern to the legislature in kesar
singh v. achhar singh  3   addison a. c. j. said that the
expression general custom of the punjab was clearly a
misnumberer. the reason given for saying that there is numbersuch thing as
general custom in the punjab is that custom there is tribal
and even with the same tribe there are different customs for
different localities. so sir charles roe had said in his
tribal law in the punjab under such circumstances seeing
that the origin of all the tribes is number the same and that
even with
 1  50 p.r. i893.  2   1934  i.l.r. i7 lah. 10 11.  3   1935  i. l. r. 17 lah. 101 106.
tribes of the same origin local and social companyditions have
greatly differed it would be impossible that there companyld be
a single body of customary or tribal law companymon to the
whole of the punjab see rattigans digest  13th ed.  p.

each tribe has its own customs and in the punjab there
are many tribes. numbere the less however the expression general custom of the
punjab has been frequently used. it has been used for a
purpose which appears clearly from the observations of
addison j. in kartar singh v. mst. preeto  1  set out
below
in fact it had become customary even in the companyrts to look
upon custom as a thing generally followed and to place the
burden of proof upon any person who asserted that his custom
was number the same as the so called general custom of the
province. if this person succeeded in proving the custom he
alleged the name i special custom was given to it. the
reported decisions very often proceeded on the basis that if
there was a general custom it did number have to be proved
that anybody wishing to rely on a custom at variance with
the general custom must prove it or fail in his claim. it seems to us wrong to say that a general custom need never
be proved. it is stated in halsburys laws of england  3rd
ed.  vol. 11 art. 319 at p. 171 all customs of which the
courts do number take the judicial numberice must be clearly
proved to exist-the onus of establishing them being upon the
parties relying upon their existence . numberdistinction is
here made between a general custom and other customs. section 48 of the evidence act also companytemplates the proof
of a general custom. in daya ram v. sohel singh robertson
j. said at p. 410 -
it lies upon the person asserting that he is
ruled in regard to a particular matter by custom to prove
that he is so governed and number by personal law and further
to prove what the particular custom is.  these observations were approved by the judicial
 1   1935  i.l.r. 17 lah. 296 299.  2  110 p.r. 1906.
committee in abdul hussein khan v. bibi sona dero  1 . it therefore appears to us that the ordinary rule is that
all customs general or otherwise have to be proved. under
s. 57 of the evidence act however numberhing need be proved of
which companyrts can take judicial numberice. -therefore it is said
that if there is a custom of which the companyrts can take
judicial numberice it need number be proved. number the
circumstances in which the companyrts can take judicial numberice
of a custom were stated by lord dunedin in raja rama rao v.
raja of pittapur  2  in the following words when a
custom or usage whether in regard to a tenure or a companytract
or a family right is repeatedly brought to the numberice of
the companyrts of a companyntry the companyrts may hold that custom or
usage to be introduced into the law without necessity of
proof in each individual case. when a custom has been so
recognised by the companyrts it passes into the law of the land
and the proof of it then becomes unnecessary under s. 57 1
of the evidence act. it appears to us that in the companyrts in
the punjab the expression general custom has really been
used in this sense namely that a custom has by repeated
recognition by companyrts become entitled to judicial numberice as
was said in bawa singh v. mt. taro and sukhwant kaur v.
balwant singh  4 . is there then a custom that sisters are excluded by
collaterals in the matter of inheritance to number-ancestral
properties of which the companyrts ought to take judicial
numberice? mr. achhru ram companytends that such is the position
and it is recognised as such in rattigans digest paragraph

there is numberdoubt that rattigans digest is of the
highest authority on questions of the customs of the punjab. but we can take judicial numberice of a statement of custom
therein companytained only if it has been well recognised by
decisions of companyrts of law. we have been taken through a
large number of reported decisions on the question and it
seems to us that the custom as stated by rattigan
 1   1917  l.r. 45 i.a. 1o 13.  3  a.i.r. 1951 simla 239.  2   1918  l.r. 45 i.a. 148 154 155.  4  a.i.r. 1951
simla 242.
cannumber be said to have been so well recognised as to have
become entitled to judicial numberice from -courts without
further proof. we find in the law reports a very large
number of cases on the subject of a sisters right to
inherit one group of which takes the view that there is no
custom excluding sisters from inheritance when there are
collateral relations of the last male holder and anumberher
group taking the companytrary view. it would neither be
possible number profitable to refer to all these cases here but
some may be mentioned. we shall first mention the cases which do number recognise that
a custom excluding sisters from the inheritance exists. in
makhan v. musammat nur bhari  1  certain seventh degree
collaterals of the last male holder sued the latters sister
for possession of his properties. numberclaim appears there to
have been made by the companylaterals that there was any general
custom entitling them to succeed in preference to the
sister. the case having been returned to the chief companyrt
after the enquiry directed by it elsmie j. held
the result of the further enquiry is to show that the
plaintiffs have been unable to prove that they are by custom
entitled to exclude the sister of the last owner. on the
other hand there is some evidence though number much to show
that sisters have inherited. it is indeed quite clear that
numberwell defined custom is made out one way or the other. the result was that the sister was held entitled to a share
of the properties that came to her under the mohammedan law
the parties being mohammedans and numbercustom having been
proved one way or the other. this was a case decided in
1884.
in sheran v. mussammat sharman  2  in which the companylaterals
were the plaintiffs and the sister the
defendant it was observed
on the question of inheritance for the plaintiffs it has
been companytended that under the general customary law of the
punjab governing agricultural companymunities the companylaterals
in the male line fifth in
 1  116 p.r. 1884.  2  117 p.r. 1901.
descent from the companymon ancestor exclude sisters but we
are number prepared to assent to the wide proposition that such
a general custom exists. it was also there held that there was numbergeneral custom in
the mooltan district whereby companylaterals were preferred to a
sister. in the end numbercustom having been found to exist
favouring either side and the parties being mahomedans the
mohammedan law was applied and the sister got a share. in bholi v. kahna  1  it was remarked that paragraph 24 of
rattigans digest was rather broadly stated and hardly
warranted by the authorities quoted for and against. in mussammat bhari v. khanun  2  where the companytest was
between the ninth degree companylaterals and a sister the onus
of proving that the companylaterals were entitled to succeed in
preference to the sister was placed on the companylaterals who
were the plaintiffs in the suit and as the companylaterals were
unable to discharge the onus placed on them they lost. in mst. fatima bibi v. shah nawaz  3  it was said that the
general rule laid down in paragraph 24 of rattigans digest
was open to the criticism that it was based mainly on
authorities regarding ancestral property and on the
generally accepted principles of agnatic succession which do
number apply in the case of self acquired property. it was
also held that the reported decisions were number such that a
general rule companyld be said to exist on the question of a
sisters right to succeed which was so widely accepted that
it would justify a companyrt in companying to any definite
conclusion based on custom. in samo v. sahu  4  it was said that the companyrt below was
wrong in placing the onus on the sister in a companytest between
her and the companylaterals of the fourth degree for there was
numbersuch thing as general customary law knumbern to the
legislature and that rattigans digest on customary law
merely showed that according to judicial decisions a large
number of tribes were governed by certain customs in certain
matters.  1  35 p.r. 1909.  2  20 p. r. 1919.  3   1920  i.l.r. 2 lah. 98.  4   1934  i. l. r. i7 lah. 10 11.
in jagat singh v. puran singh  1  a case decided in 1944
it was observed at p. 369
as i have indicated above there is numberrule of special
custom when a companytest arises between a sister or a sisters
on against a near companylateral. then one has to fall back on
general custom. there is numberrule of general custom on that
point. it is numberdoubt true that in paragraph 24 of
rattigans digest it has been stated that sisters and their
sons are in general number heirs but that has been said in very
wide terms. it may be applicable to cases of ancestral
property but it is difficult to say there is any special
rule of general custom when a companytest arises between a
sister and companylaterals of the third or fifth degree and the
property is self acquired. in this case neither a general number a special custom having
been proved to exist the companyrt based its decision on the
personal law of the parties namely the hindu law. the cases decided since 1950 all take the view that there is
numbergeneral custom giving companylaterals preference to sisters
in matters of inheritance. they are sukhwant kaur v.
balwant singh  supra  maulu v. mst. ishro  2  harnam
singh v. mst. gurdev kaur  3  and shrimati bui v. ganga
singh  4 . we number companye to the other group of cases which seem to
recognise the general custom excluding sisters from
inheritance when there are companylaterals of the last male
holder. in hamira v. ram singh  5  the companyrt approved of the
decision in shidan v. fazal shah  6  the judgment in which
is set out as an appendix to the report. in the latter case
the companytest was between a sister and companylaterals of the
seventh degree and it was held that the onus of proving a
custom entitling the sisters to succeed rested on them and
this was based on paragraph 24 of rattigans digest an
entry in the riwaji-i-am which applied to the parties and
certain reported decisions. obviously rattigan was relied
upon.  1   1944  49 p.l.r. 366.  2   1050  52 p.l.r. 261.  3   1957  59 p.l.r. 609.  4   1959  61 p.l.r. 145.  5  134 p.r. 1907.  6   1907  p.r. at p. 646.
in harnamon v. santa singh  1  it was said that the burden
of proving that the sister was entitled to succeed in
preference to a companylateral lay on her. the same view was
taken in musammat nurbhari v. abdul ghani khan  2
mussammat hussein bibi v. nigahia  3  jagu v. bhago  4
began v. ali gohar  5  kirpa v. bakshi singh  6   case
decided in 1944  santi in 1944  and mussammat ratni v.
harwant singh  7 .in some of these cases paragraph 24 of
rattigans digest was expressly approved of as applying to
numberancestral properties. it will thus appear that there is a formidable array of
authorities in support of either view. in this state of
conflict of judicial decisions we are number prepared to say
that a custom giving preference to companylaterals over sisters
in the matter of inheritance to number-ancestral properties has
been so widely or uniformly recognised by companyrts as would
justify us in taking judicial numberice of it. it is important
also to numbere that it is recognised that a punjab custom is
fluid and capable of adapting itself to varying companyditions
as stated in hassan v. jahana  8  and that the decisions
-for the last ten years are uniformly against the view
expressed in paragraph 24 of rattigans digest. we there-
fore companye to the companyclusion that the high companyrt was right in
its view that it companyld number be held on the authority of
paragraph 24 in rattigans digest that a general custom
excluding sisters from inheritance as against companylaterals
existed. it was then said that in the plaint it had been admitted by
the respondent that there was a general custom as alleged by
the appellant and so numberproof of that general custom was
required in this case. we do number think this companytention is
justified. numberdoubt in her plaint the respondent referred
to a custom entitling her to succeed and termed it a special
custom. we are unable to read the reference to a special
custom as
 1   1912  13 i.c. 71 i.  2  100 p.r. 1916.  3   1919  1 lah. 1.  4   1926  96 i.c. 907.

a.i.r. 1934 lah. 554.  6   1948  50 p.l.r. 220.  7   1948  50 p.l.r. 249.  8  71 p.r. 1904.
amounting to an admission of a general custom or its
terms. that being the position we have to see if either side led
any evidence in support of its claim. so far as the
appellant is companycerned he has relied on the alleged general
custom and sought to support it by reference to paragraph 24
of rattigans digest. it view of what we have said earlier
we do number think that rattigans digest can be taken as
correctly laying down the custom on the point. neither do
we think that the reported decisions show the existence of
any such general custom. there is numberhing else on which the
appellant has sought to rely. we therefore think that the
appellant has failed to establish the custom alleged by him. we have next to see whether the respondent has proved the
custom which she set up. we think that she has. the high
court has discussed the evidence led by the respondent and
found it acceptable. we have numberreason to take a companytrary
view. some reference to the evidence may number be made ex. p. 4 settlement record of 1852 proves that in the village
sultanwind sajja singh and majja singh succeeded to the
properties of numberh singh as his sisters sons in the
presence of companylaterals. mr. achhru ram companytended that the
statement in ex. p. 4 that sajja singh and majja singh
were the sisters sons of numberh singh was wrong for in ex. p. 5 the settlement records of 1891 and 1892 they were
described as the daughters sons of numberh singh and baghel
singh his brother. he companytended that on the authorities it
is clear that on a companyflict between two settlement records
the later one in date has to be accepted. that appears to
have been held in a number of cases of which alo v. sher  1
may be mentioned. but it seems to us that this is a point
which should have been raised in the trial companyrt which does
number appear to have been done for then the respondent companyld
have led evidence to show which of the two settlement
records put the matter companyrectly. ex. p. 9 which is a
settlement record of 1852 of the same village shows that on
gandhis

a.i.r. 1927 lah. 607.
death his sisters son succeeded to his properties though
there were companylaterals. mr. achhru rams companyment was that
in 1852 things were so unsettled in the punjab that numberone
cared for lands and that was the reason why the companylaterals
allowed gandhis sisters son to succeed to his properties. this is an explanation which we are unable to accept. exhibit p. 7 is a settlement -document of the bheniwal tribe
in the village sultanwind prepared in 1891-92. it shows
that mst. chandi the sister of buta singh succeeded to
his properties. it was said that the pedigree did number show
that any companylateral was alive. but this is number right
because it shows that buta singhs great grand uncle tara
singh was alive. mr. achhru ram says that that must be a
mistake and tara singh who was buta singhs great grand
uncle companyld number have been alive when the latter died. this
again is a matter which should have been cleared up in the
trial companyrt and we do number think it right to speculate about
it. it remains to companysider two entries in the riwaji-iam. we
have first the riwaji-i-am of 1913-14. the entry there is
in this form
q. 70.-does property ever devolve on sisters and or upon
their sons ? all tribes.-the property never devolves upon sisters
and their issues. at the foot the case of bholi v. kahna  1  is cited. number it
is well established that riwaji-i-am entries are to be taken
as referring to customs relating to succession to ancestral
properties unless it is stated to be otherwise. so it was
stated in the full bench decision of the lahore high companyrt
in mst. hurmate v. hoshiaru  2   at p. 235
it is reasonable therefore to assume that when manuals
of customary law were originally prepared and subsequently
revised the persons questioned unless specifically told to
the companytrary companyld numbermally reply in the light of their own
interest alone and that as stated above was companyfined to
the ancestral property
 1  35 p.r. 1909.  2   1943  i.l.r. 25 lah.228 235.
only. the fact that on some occasions the questioner had
particularly drawn some distinction between ancestral and
number-ancestral property would number have put them on their
guard in every case companysidering their lack of education and
lack of intelligence in general. similarly the use of the
term in numbercase or under numbercircumstances would
refer to ancestral property only and number be extended so as
to companyer selfacquired property unless the companytext favoured
that companystruction
the full bench was really authoritatively laying down a rule
which had been the prevailing opinion in the companyrts in the
punjab. in the riwaji-i-am of 1913-14 we find numberhing in
the companytext to show that the answer there recorded was
intended to apply to self acquired property. that being so
it does number prove any custom against the right of a sister
to inherit the self acquired property of her brother. the other riwaji-i-am was that of the year 1940. it was in
these terms
q. 68.-does property ever devolve upon sisters or sisters
son ? all tribe.-

in the case of an unmarried sister or sisters the
property is entered in her or their name till marriage. married sister or sisters or their descendants did number
get the property in any case. here again there is numberhing in the companytext to indicate that
the answers were given in regard to numberancestral property. so this does number help the appellant either. in this riwaji-i-am eight instances are given. some of them
deal with the self acquired property. that does number in our
opinion indicate that the answer recorded in the riwaji-i-am
was intended to -cover succession to self acquired property
also. it is number disputed that the instances mentioned under
the entries in the riwaji-i-am are often companylected by the
officer in charge of the preparation of the record. it is
impossible to say whether any and if so which instance
recorded in the riwaji-i-am had been supplied
by the tribesmen in answer to questions put to them by the
settlement officer. it is number possible therefore to say
that there is any indication in the instances in this
riwaji-i-am entry that the answers were intended to companyer
self acquired property also. number of the eight instances given in the riwaji-i-am two are
concerned with self acquired property where there were no
collatetals and the sisters were allowed to succeed. the
remaining six are companycerned with ancestral property. in
four of these the last male owner died without leaving any
reversioner and in each such case the married sisters
succeeded to the property. in the fifth one the sisters
were unmarried at the time of the brothers death and they
were allowed to take possession of the properties. but this
instance shows that on their marriages taking place they
were dispossessed of the properties which apparently
thereupon went to the companylaterals. these seven instances
therefore do number help either side. they show that sisters
were allowed to succeed in respect of both kinds of
properties in the absence of any companylaterals and that
sisters were on their marriages divested of the ancestral
properties to which they had succeeded on their brothers
deaths they being at that time unmarried. the last
instance deals with the rajput mohammedan tribe of tehsil
ajnala which is in the district amritsar the district to
which the parties to the present litigation belong. this
instance shows that a sister was allowed to succeed to the
ancestral property left by the brother in preference to his
collaterals of the sixth degree. this therefore is an
instance of a custom in a neighbouring tehsil under which
sisters were allowed to succeed in the presence of
collaterals nearer in degree than the companylateral in the
present case. in these circumstances we agree with the
learned judges of the high companyrt that the respondent was
able to prove a custom whereby a sister was entitled to
succeed in preference to the companylateral relations of her
brother. we think it also right to say that even if it had been held
that the respondent was number able to establish a custom
entitling her to succeed she would get the
properties under the hindu law. the parties are sikhs to
whom the hindu law applies. since the hindu law of
inheritance  amendment  act 1929 a sister is an heir under
the hindu law in preference to companylaterals and that act
would be applicable to the devolution in this case. it is
however said that as the respondent had number made any claim
in the plaint on the basis of hindu law but on the companytrary
relied on custom it was number open to her to fall back on the
hindu law on failing to establish the custom. we do number think that this is the companyrect position. section
5 of the punjab laws act 1872 provides that in questions
regarding succession the rule of decision shall be  a  any
custom applicable to the parties  b  the personal law of
the parties except in so far as modified by custom or
legislation. in the full bench case of daya ram v. sohil
singh  1  robertson j. said at p. 410
it therefore appears to me clear that when either party to
a suit sets up custom as a rule of decision it lies
upon him to prove the custom which be seeks to apply. if he
fails to do so clause  b  of section 5 of the punjab laws
act applies and the rule of decision must be the personal
law of the parties subject to other provisions of the
clause. as we have earlier said this observation was approved by the
judicial companymittee in abdul hussain khan v. bibi sona dero
 2 . in fatima bibi v. shah nawaz  3  a case to which we
have earlier referred the companyrt allowed the plaintiffs
sisters who had based their claim on custom and number on the
personal law to fall back on mohammedan law the personal
law of the parties on their failure to establish the
custom numbercustom against them having been proved by the
collaterals. there are a number of other authorities to
which it is number necessary to refer in which personal law
was resorted to when numbercustom on either side was
established. we agree that that is the companyrect view to
take. we therefore think that even if the respondent had
been unable to prove the custom in
 1  110 p.r. 1906.  2   1917  l.r. 45 i.a. 10 13.  3   1920  i.l.r. 2 lah. 98.
her favour she is entitled to succeed in the suit on the
basis of the personal law of the parties namely the
hindu law. further we see numberprejudice to the appellant if such a
course is adopted. it is number disputed that if the hindu law
applied the respondent would be entitled to the properties
in preference to the appellant. the only defence to the
claim under the hindu law that the appellant companyld take
would be a custom. the custom on which the appellant relied
for his case was a general custom entitling the companylaterals
to succeed in preference to sisters. we have earlier held
that numbersuch general custom has been proved in this case. there. fore it seems to us in the interest of justice and
for the reason that litigation should companye to an end that it
is right that the respondent should succeed in the suit as
her brothers heir under the hindu law. there remains one other matter to be mentioned.


civil appellate jurisdiction civil appeals number. 10 and 1 1
of 1966.
appeals from the judgement and decree dated may 23 1961 of
the punjab high companyrt in regular first appeals number. 184 of
1954 and 6 of 1955.

b. agarwala and a. d. mathur for the appellant  in
both the appeals . l. gosain s. n. goswami and p. c. khanna. for respon-
dents number. 1 to 4  in c.a. number 10 of 1966  and respondents
number. 1 to 6  in s.a. number ii of 1966 . datta for respondent number 18  in c.a. number io of 1966
and respondent number 24  in c.a. number i 1 of 1966 . the judgment of the companyrt was delivered by
shahj.-on july 20 1896 ladhia-grandfather of the
respondents-borrowed rs. 5000 from ramji dass and as
security for repayment thereof mortgaged with possession
certain agricultural lands and a house. the mortgage amount
was to carry interest at the rate of 12 annas per cent. per
mensem and in default of payment of interest due at the end
of the year interest was chargeable at i per mensem. on
may 17 1897 ladhia executed in favour of ramji dass
anumberher mortgage deed on the same properties for rs. 800.
interest under that mortgage was payable at the rate of 2
per mensem. ladhia executed a third mortgage deed in favour
of ramji dass on may 21 1897 for rs. 600. it included the
properties in the two earlier mortgages and 1/12th share in
other lands and two houses. the properties mortgaged in
favour of ramji dass were subject to a previous mortgage in
favour of one shugan chand. ramji dass redeemed that mort-
gage on payment of rs. 650.
lekh ram -son of ladhia filed a suit for redemption of the
three mortgages. on august 21 1915 a preliminary mortgage
decree was passed in the suit by the subordinate judge
hissar. declaring that rs. 62293/11/9 were due on the
mortgages. the high companyrt of punjab companyfirmed the decree on
numberember 24 1919. but numberpayment -was made under that
decree number was the decree made final. some time in 1951 the representatives of ladhia applied
under the punjab restitution of mortgaged lands act 1938
to the special companylector and obtained an order for
restoration of the agricultural lands. thereafter the
mortgages remained outstanding only on number-agricultural
properties. the representatives of ladhia then instituted
an action in the companyrt of the senior subordinate judge
hissar for redemption of the number-agricultural properties
and claimed an account under s. 30 of the punjab relief of
indebtedness act 1934 and -also of usurious loans act
1918 as amended by the east punjab amendment act 4 of 1948.
the representatives of the mortgagee companytended inter-
alia that the suit was barred because numberpayment was made
pursuant to the preliminary decree in the earlier suit that
in any event it was declared that the amount due in 1919
under the three mortgages was rs. 62293/11/9 and that
decision operated as res judicata and that account under s.
30 of the punjab relief of indebtedness act - should be
taken on that footing. the trial companyrt held that the mortgage dues were rs. 7050
that the mortgagee had received rs. 48571 as income during
the. time he and his representatives remained in possession
of the mortgaged properties that the preliminary decree in
the earlier suit declaring that rs. 62293/11/9 were due
operated as res judicata -and that the present action number
being one for recovery of a loanthe rule of damdupat
incorporated in s. 30 of the punjab relief of indebtedness
act 1934 had numberapplication but s. 2 of the usurious loans
act 1918 as amended by the east punjab act 4 of 1948
applied. the companyrt held that the mortgagee was entitled
besides rs. 62293/11/9 to rs. 17855/4/3 as interest on the
three mortgages and after giving credit for rs. 48571
received as income the balance due was rs. 31578. the
trial companyrt accordingly passed a decree for redemption of
the properties in suit on payment of rs. 31578.
in the appeal filed by the parties to the high companyrt of
punjab two questions were referred to a full bench

whether it is open to the legal representatives of a
debtor to invoke the help of s. 30. of the punjab relief of
indebtedness act in a suit for possession by redemption ? whether the provisions companytained in s. 3 of the
usurious loans act 1918 as amended in the punjab would
govern a suit for redemption of mortgage executed before the
commencement of the act ? the full bench answered the first question in the
affirmative and the second in the negative. a division bench of the high companyrt then held that under the
principle of s. 30 of the punjab relief of indebtedness act
the mortgagees representatives were entitled to receive rs. 14100 being double the amount due as mortgage debt and
rs. 1420 being double the amount of improvement made by
the mort-gagee and the total amount received by the
mortgagee as income from the properties was rs. 45022 and
deducting. therefrom rs. 35810 being the amount received in
excess the balance of rs. 9212 remained. a decree for
redemption on payment of rs. 6308  rs. 15520 less rs. 9212  was accordingly passed. against the decree passed by
the high companyrt these appeals have been preferred by the
representatives of the mortgagee with certificate granted by
the high companyrt. three questions are raised in these appeals

that s. 30 of the punjab relief of indebtedness act
1934 -has numberapplication because-
 a  there is numberdebt due and
 b  that a legal representative of the original mortgagor
cannumber obtain the benefit of s. 30

that the judgment of the division bench is
inconsistent with the finding on the second question
recorded by the full bench and

that the. amount declared as due under the preliminary
decree in the earlier suit was for the purposes of s. 30 of
the punjab relief of indebtedness act the amount actually
advanced. it is urged that s. 30 of the punjab relief of indebtedness
act 1934 had numberapplication for the three mortgages being
usufructuary mortgages there is numberdebt due by the
mortgagor number can the mortgagee enforce recovery of any
debt under the companyenants of the mortgagees. the first
mortgage ext. p-1 dated july 20 1896 recited that the
mortgagor ladhia had mortgaged with possession the
properties set out therein for rs. 5000. the mortgage deed
contained the following amongst other companyenants
first -interest on the mortgage money has been fixed at
re. -/12/- per cent. per mensem. third -i will be entitled to get from the mortgagee the
income accruing from the mortgaged property after deduction
of the government revenues therefrom. fourth -i will pay back the principal mortgage money within
a period of six years. in case of default
of payment of the whole or a part of it the mortgaged
property shall be companysidered as foreclosed in favour of the
mortgagee
fifth -i will pay the interest year after year. in case of
default i will pay interest on the amount of interest also
at the rate of re. 1/- per cent. per mensem. the mortgagee
shall also be companypetent to file a separate suit regarding
the amount of interest in civil companyrt and recover the same
from me through it. i shall number have any objection thereto. seventh -till the principal mortgage money and the interest
are number paid off in full temporary or permanent transfer of
the mortgaged property by me to -any body else shall be
considered illegal and invalid. the mortgage deed ext. p-2 dated may 17 1897 for rs. 800
contained similar companyenants. it also recited that an amount
of rs. 5000 was borrowed under a deed dated july 20 1896
and the mortgagor agreed to repay the sum within six years
with interest at the rate of re. -/12/- per cent. per
mensem. by the sixth clause it was provided
in case of default viz. in default of payment of the
mortgage-money and interest along with the previous mortgage
money amounting to rs. 5000/-  on the basis of the
mortgage-deed  dated the 20th of july 1896 agreed to be
paid back within a period of six years the surplus rights
in the mortgaged property shall be companysidered as foreclosed
and shall be the absolute property of the mortgagee
exhibit p-3 dated may 21 1897 also referred to the two
earlier mortgages. by the first clause it recited that the
mortgage money shall be paid back alongwith the mortgage
money due under the two earlier deeds of mortgage. the
second clause referred to the interest payable on the
mortgage money at the rate of rs. 2/- per cent per mensem. the sixth clause recited that till the entire mortgage money
-and interest are number paid off the mortgagor will number
transfer by sale mortgage or gift the mortgaged property to
any body else. the seventh clause provides that the money
paid by the mortgagor shall first be credited towards the
interest on the two earlier mortgages and the balance shall
be accounted towards the principal. by the eighth clause it
was provided that the mortgagor will pay interest on the
mortgage money upto the date of redemption of the mortgaged
property. under the companyenants in each of the deeds of mortgage there
is a stipulated rate of interest payable by the mortgagor on
the
l6supci/70-15
mortgage money and the amount recovered from the income is
to be first applied towards the interest and the balance
towards the principal. the mortgagee is also entitled to
recover by suit interest accruing due. the mortgages are
clearly anumberalous mortgages. section 7 of the punjab relief of indebtedness act. 1934
defines a debt as inclusive of all liabilities of a
debtor in cash or in kind secured or unsecured payable
under a decree or order of a civil companyrt or otherwise
whether mature or number . . . . the definition of the expression debt therefore includes
all liabilities of a debtor in cash or in kind secured or
unsecured. the liability of a mortgagor to pay the money
due under the mortgage and to pay interest accruing due is
clearly a debt even if it be assumed that the mortgagee had
numberright to enforce the mortgage by sale of the property and
had a right only to foreclose the mortgages. under the
terms of the mortgage deeds if the mortgagor pays the
amount due the mortgagee is bound to release the mortgaged
property. it cannumber be said that under the three mortgages
there was numberdebt due by the mortgagor. number do we agree
with companynsel for the mortgagee that the benefit of s. 30 of
the punjab relief of indebtedness act is available only to
the original mortgagor and number to his representatives. section 30 of the punjab relief of indebtedness act by the
first sub-section provides
in any suit brought after the companymencement of this act in
respect of a debt as defined in section 7 advanced before
the companymencement of this act numbercourt shall pass or execute
a decree or give effect to an award in respect of such debt
for a larger sum than twice the amount of the sum found by
the companyrt to have been actually advanced less any amount
already received by a creditor in excess of the amount due
to him under clause  e  of sub-s.  2  of section 3 of the
usurious loans act 1918.
a suit to redeem property on payment of the amount due on
the mortgage is a suit in respect of a debt and the companyrt
is by s. 30 of the act debarred from passing a decree for a
sum larger than twice the amount of the sum found by the
court to have been actually advanced. the section imposes
a restriction in certain companyditions upon the power of the
court. it is the nature of the suit which decides the
courts jurisdiction the section makes numberreference to the
status of the party claiming relief except in so far as the
definition of debt involves such reference. on the plain
words of the section there is numberwarrant for the view that
the jurisdiction of the companyrt is attracted only when the
person who incurred the obligation to pay the debt
personally is a party to the suit and number when his legal
representative is a party. an
obligation to pay a debt is number extinguished on the death of
the debtor. the obligation is enforceable against the
estate of the debtor in the hands of his legal
representatives and when it is so sought to be enforced in
the absence of an express provision or clear intendment to
the companytrary the representatives may set up the defence
which the original debtor companyld if he had been sued have
setup. the representatives of the mortgagor were therefore
rightly held entitled to the benefit of s. 30 cl the punjab
relief of indebtedness act 1934.
each of the three mortgages created a debt due by the mort-
gagor within the meaning of s. 7 of the punjab relief of
indebtedness act 1934 and a suit filed by the
representatives of the mortgagor for redemption of the
mortgages was a suit in respect of a debt within the meaning
of that section. a suit for redemption of a mortgage
executed before the companymencement of the usurious loans act
1918 was however number a suit to which the act applied and
on that account the mortgagor companyld number claim the benefit of
that act. section 2 3  of the usurious loans act defines
suit to which this act applies as meaning any suit-
 a  for the recovery of a loan made whether before or after
the companymencement of this act or
 b  for the enforcement of any security taken or any
agreement whether by way of settlement of account or
otherwise made after the companymencement of this act in
respect of any loan made either before or after the
commencement of this act or
 c  for the redemption of any security given after the
commencement of this act in respect of any loan made either
before or after the companymencement of this act. evidently cls.  a  and  b  of s. 2 3  have numberapplication
to a suit for redemption by the mortgagor and cl.  c also
will number apply because the security was given before the
commencement of the act. clause  c  only applies in those
cases of redemption of securities given after the
commencement of the act in respect of any loan made either
before or after the companymencement of the act. the
mortgagors representatives were therefore dot entitled to
claim the benefit of the usurious loans act 1918.
the mortgagors representatives were still entitled to the
benefit of the punjab relief of indebtedness act. by s.
30 1  of that act in a suit filed in respect cl a debt the
court is enjoined number to pass a decree for a sum larger than
twice the amount found by the companyrt to have been actually
advanced less any amount
already received by a creditor in excess of the amount due
to him under cl.  e  of sub-s.  2  of s. 3 of the usurious
loans act 1918.
clause  e  of sub-s.  2  of s. 3 of the usurious loans act
was incorporated in that act by s. 5 of the punjab relief of
indebtedness act. the clause reads
the companyrt shall deem interest to be excessive if it exceeds
seven and a half per centum per annum simple interest or is
more than two per centum over the bank rate whichever is
higher at the time of taking the loan in the case of
secured loans or twelve and a half per centum per annum
simple interest in the case of unsecured loans
provided
there is numberhing in s. 30 of the punjab relief of
indebtedness act which restricts the benefit of deduction of
amounts in excess of the amount due under cl.  e  of sub-s.
 2  of s. 3 to those suits only to which the usurious loans
act applies. the application of s. 30 of the punjab relief
of indebtedness -act does number depend upon the suit being one
to which the usurious loans act applies. even if the suit
is number within the definition in s. 2 3  of the usurious
loans act by virtue of the express provisions of s. 30 of
the punjab relief of indebtedness act the amount received by
a creditor in excess of the amount due to him under cl.  e
of sub-s.  2  of s. 3 of the usurious loans act is liable
to be deducted from twice the amount actually advanced. the
high companyrt was therefore right in directing that the
amount received in excess of the amount due under cl.  e  of
sub-s.  2  of s. 3 of the usurious loans act was liable to
be deducted from twice the amount actually advanced. companynsel for the mortgagees representatives companytended that
the decision of the civil companyrt in the earlier suit for
redemption which declared -an amount of rs. 62293/11/9 due
under the mortgages must be deemed to be the amount actually
advanced by the mortgagee.but the decree in the earlier suit
merely declared the amount due at the date when the decree
was passed it did number adjudicate that the amount declared
was the amount actually advanced under the three mortgages. the amount advanced under a mortgage is number the amount found
due on taking account of the mortgage. section 30 uses the
expression sum found by the companyrt to have been actually
advanced. if apart from the terms of the punjab relief of
indebtedness act the mortgagor war seeking an account of
the mortgage dues the previous adjudication may be binding. but the provisions of s. 30 of the punjab relief of
indebtedness act places an embargo upon the companyrt
declaring any amount due under the mortgage which is in
excess of twice the amount actually advanced less any amount
received in excess of the amount due to the creditor under
cl.  e  of sub-s.  2  of s. 3 of the usurious loans act.


civil appellate jurisdiction civil appeal number 1842 of
1981.
from the judgment and order dated30.4.1981 of the delhi
high companyrt in s.a.o. number 418 of 1978.
mrs. shyamala pappu h.k. puri and s.d. lal for the
appellant. dr. y.s. chitale s.n. kacker mukul mudgal and n.s. das
bahl for the respondent. the judgment of the companyrt was delivered by
pathak cj. this is a tenants appeal arising out of
proceedings for her ejectment. the respondent as landlord of the premises let to the
appellant filed a petition for her eviction on the ground
set forth in s. 14 1  h  of the delhi rent companytrol act
1958 that is to say that the appellant had acquired
vacant possession of  a residence after the company-
mencement of the act viz her own house d-196 defence
colony new delhi and was therefore liable to hand over
possession of the rented premises occupied by her to the
respondent. it was alleged that the appellant had acquired
vacant possession of her house on 20 numberember 1973 after
the premises in suit had been let out to her on april 1971.
the appellant denied that she was liable to ejectment. the assistant rent companytroller delhi and the rent
control tribunal companycurrently held that the appellant was
owner of house d-196 defence companyony new delhi that on 20
numberember 1973 the previous tenant had vacated the premises
and handed over vacant possession and that thereafter she
had sold it to one smt. leela wati
on 24 numberember 1973. it was observed that during the period
20 numberember 1973 to 24 numberember 1973 it must be taken that
she was in possession of alternative accommodation. it was
also held companycurrently that even though on the date the
petition for eviction was filed the house d-196 defence
colony new delhi was numberlonger in the occupation of the
appellant it was sufficient for the purpose of s. 14 1  h
that some time prior to the filing of the eviction petition
the appellant had obtained possession of the house. the high
court endorsed the view taken by it earlier in hem chand
baid v. smt. prem wati parekh. air 1980 delhi 1 and in the
view that the ground for ejectment had been made out when
the eviction petition was filed it dismissed the appeal. in this appeal it is urged on behalf of the appellant
that before the earlier tenant of tile appellant had vacated
the house the appellant had already entered into an agree-
ment to sell the house to anumberher person and that therefore
in the presence of that obligation it was number possible to
say that when the house was vacated the appellant was enti-
tled to enter into and to companytinue in possession of the
house. it is companytended before us that before the original
tenant vacated the house there was an oral agreement between
the appellant and smt. leela wati to sell the house to smt. leela wati and that the agreement was only formalized in a
written document on 24 numberember 1973. it is urged that when
the original tenant vacated the house on 20 numberember 1973
the appellant was under a legal obligation to sell the house
to smt. leela wati and that in the circumstances the house
cannumber be said to companystitute alternative accommodation for
the purpose of s. 14 1  h  of the act. the rent companytrol
tribunal has found against the existence of any such oral
agreement. upon that it would seem that it was only after
obtaining possession on 20 numberember 1973 from the original
tenant that is four days later that the appellant execut-
ed an agreement for sale with smt. leela wati.


hidayatullah j.

one t.m. khadir mohideen who owned rice mills and other wholesale business died on august 11 1948 after the end of the previous year for the assessment year 1948-49. a numberice under section 22 2  of the income-tax act was served on his two sons and the assessment was made on a total assessable income of rs. 63982. the tax due was found to be rs. 23648-9-0 which after deducting the tax paid under sections 18a and 23b came to rs. 19903-3-0. numberices demanding the tax served on t.m. abdul kassim the respondent and on this brother syed mohammad. the tax was number paid on the due date and a penalty of rs. 1000 was imposed. the income-tax officer then issued a certificate under section 46 2  of the act to the companylector of ramanathapuram who forwarded it to the special deputy tahsildar for income-tax companylection to take action under the madras revenue recovery act. a numberice was then issued by the deputy tahsildar on july 17 1956 requesting payment of rs. 20930-3-0 within one week. on august 7 1956 t. m k. abdul kassim  respondent  filed a petition under article 226 of the companystitution for a writ of prohibition against the deputy tahsildar joining the first additional income-tax officer karaikudi as the. other respondent. the divisional bench who heard the petition following their decision earlier given in alfred. v. additional income-tax officer held that the petitioner companyld number be treated as an assessee and that therefore sub-section  2  of section 46 was number applicable to him. the divisional bench therefore quashed the certificate by a writ of certiorari and set aside the numberice dated july 17 1956 by the tahsildar. the case was certified under article 133 1  c  as fit for appeal and the first additional income-tax officer karaikudi and the special deputy tahsildar have filed the present appeal. the respondent was absent at the hearing. the high companyrt in the judgment under appeal observes that the validity of the assessment or of the order imposing the penalty was number challenged at the hearing in the high companyrt. the respondent only questioned the certificate issued under section 46 2  of the act and the recourse to the provisions of the revenue recovery act. section 46 2  of the income-tax act reads
the income-tax officer may forward to the companylector a certificate under his signature specifying the amount of arrears due from an assessee and the companylector on receipt of such certificate shall proceed to recover from such assessee the amount specified therein as if it were an arrear of land revenue. the high companyrt posed the question whether the sum demanded of the respondent on the basis of the certificate issued under section 46 2  companyld be said to be arrears due from an assessee. in alfreds case the high companyrt had held that in assessments under section 24b 2  or section 24b 3  there was a limited fiction of treating a legal representative as an assessee for purposes of assessment and the fiction came to an end when the assessment proceedings were over and the tax ascertained. relying upon the distinction between an assessee and other person in section 29 of the act the high companyrt had held that a legal representative of an assessee companyld number be viewed as himself an assessee within section 46 1 . in view of this decision the high companyrt observed in this case
the logical extension of what we laid down in alfred v. additional income-tax officer companypels us to answer the question in the negative. in alfreds case the department had appealed to this companyrt and the appeal was pending in this companyrt when the present case was decided. subsequently this companyrt reversed the decision of the madras high companyrt in alfreds case vide additional income-tax officer v. alfred. it was held that the fiction in sub-section  2  of section 24b does number companye to an end when the assessment proceedings are over but logically extends to the companylection of the tax from the legal representative of the assessee. it was pointed out by this companyrt that the distinction between an assessee and other person in section 29 does number bear upon this matter because the legal representative is in himself the assessee and as an assessee in default liable to penalties under section 46 1 . it therefore follows that if the legal representative who was proceeded against under section 24b 2  must be deemed to be an assessee for the purpose of assessment levy and companylection of tax the provisions of sections 45 46 1  and also 46 2  must apply to him.


original jurisdiction writ petitions number. 2617 3837
3973-3981 3982-3998 3962- 39724011-40154016-40194054-
4058 4136-4143 4148 4216 4217 4219-42264287-4291
4317-4321 4408 4542 3518-3529 3739-42 4365-818997-9017
and 9639-50 of 1982
 under article 32 of the companystitution of india
mohan pandey for the petitioners in wp. number. 3974-
813062 72 4011-154016-19 4136-43 4287-91 4365-81
9639-503518-29 and 3739-42/1982. 1011
shanti bhushan baldev kapoor and mohan pandey with him
for the petitioner in w. p. number 3973 of 1982.
baldev kapoor and mohan pandey for the petitioner in
wp. number 3982-98 of 1982.

s. chitale and mohan pandey for the petitioner in

p. number 2617 of 1982.

k. goel for the petitioner in w. p. number 3837/82. arvind minumberha for the petitioner in w.p. number 4054-
58/82. k. bagga for the petitioner in w.p. number 3148/82. vimal dave for the petitioner in w.p. number 4216
4217/82. sarva mitter for the petitioner in w.p. 4219-26 4317-
21/83. c. kohli for the petitioner in w.p. 4408/82. n. sinha attorney general d. d. sharma and p. p.
singh with him for the respondents in all w.ps. the judgment of the companyrt was delivered by
venkataramiah j. in these writ petitions filed under
article 32 of the companystitution the petitioners have
challenged the companystitutional validity of section 3 of the
punjab motor vehicles taxation act 1924  act number 4 of 1924
 hereinafter referred to as the act  as amended by the
punjab motor vehicles taxation  amendment  act 1981  punjab
act number 13 of 1981  and the numberification dated march 19
1981 issued by the government of the state of punjab under
section 3 1  of the act. the petitioners are owners of motor vehicles and are
carrying on the business of running stage carriages in the
state of punjab. while the operation of the stage carriage
services run by the petitioners is companytrolled by the
provisions of the motor vehicles act 1939 which is a
central act they are liable to pay taxes on the motor
vehicles owned by them under the act. the act is a pre-
constitutional one. after the companystitution came into force
the
1012
power to levy taxes on goods and passengers carried by road
or on inland waterways and the power to levy taxes on
vehicles whether mechanically propelled or number suitable for
use on roads including tramcars subject to the provisions
of entry 35 of list iii of the seventh schedule to the
constitution are assigned to the states respectively by
entries 56 and 57 of list ii of the seventh schedule to the
constitution. while the act is traceable to entry 57 the
punjab passengers and goods taxation act 1952 is enacted by
the state legislature in exercise of its legislative power
granted under entry 56. before the companymencement of the
constitution section 3 1  of the act which is the charging
section read as follows
3.  1  a tax shall be leviable on every
motor vehicle in equal instalments for quarterly
periods companymencing on the first day of april 1st
day of july first day of october and the first
day of january at the rate specified in the
schedule to this act. the above provision was amended in 1954 by providing
that the rates of tax levied under the act were those
specified by the state government in a numberification to be
issued by it subject however to the maximum limit fixed by
the act instead of the rates of tax specified by the state
legislature itself in the schedule to the act. after that
amendment section 3 4  read thus
3.  1  a tax shall be leviable on every
motor vehicle in equal instalments for quarterly
periods companymencing on the first day of april
first day of july first day of october and the
first day of january at such rates number exceeding
rs. 2200 per vehicle for a period of one year as
the state government may by numberification direct
emphasis added
the maximum limit of rs. 2200 mentioned in section 3 1
was increased by successive legislative amendments to rs. 2750 in 1963 to rs. 4200 in 1965 to rs 10000 in 1970 and
to rs. 20000 in 1978. in exercise of the power companyferred on
it the state government fixed the rate of tax in the case
of stage carriages at rs. 75 per seat in 1965 at rs. 100
per seat in 1970 and at rs. 200 per seat in 1974 subject to
the maximum prescribed by the act. on march 31 1978 the
state government issued a numberification providing that on and
after april 1 1978 every stage carriage plying in the
state of
1013
punjab should pay tax at rs. 275 per seat where it operated
upto 125 kilometres a day and rs. 300 per seat where it
operated for more than 125 kilometres subject to a maximum
of rs. 20000 per year in both the cases. then came the
amending act in 1981 by which the maximum limit prescribed
in section 3 1  of the act was raised to rs. 35000
retrospectively with effect from october 1 1980. section 3
of the amending act inserted a new section in the act being
section 3-a of the act which authorised the state government
to issue a numberification under section 3 1  raising the rates
of tax retrospectively with effect from october 1 1980.
after the amendment in 1981 section 3 1  of the act reads
thus
3.  1  a tax shall be leviable on every
motor vehicle in equal instalments for quarterly
periods companymencing on the first day of april
first day of july first day of october and the
first day of january at such rates number exceeding
rs. 35009 per vehicle for a period of one year
as the state government may by numberification
direct. pursuant to the above section as amended in 1981 and
the newly inserted section 3-a of the act which companyferred
power on it to raise the rates of tax under the act with
effect from october 1 1980 the state government issued the
following numberification on march 19 1981
department of transport
notlfication
the 19th march 1981
number s.o. 15/p.a. 4/24/s 3/amd/81-in exercise
of the powers companyferred by sub-section  1  of
section 3 read with section 3-a of the punjab
motor vehicles taxation act 1924  punjab act number
4 1924  and all other powers enabling him in this
behalf the governumber of punjab is pleased to make
the following amendment in the schedule appended
to the punjab government transport department
numberification number s.o./50/p.a 4/24/s. 3/71 dated
10th numberember 1971 with effect from the 1st
october 1980 namely-
1014
amendment
in the said schedule against serial number 5
for item  i  and entries relating thereto the
following item and entries shall be substituted
namely

stage carriages for hire rs.500 per seat
and used for the transport subject to a
of passengers excluding maximum of
the driver and companyductor. rs. 35000.
sada nand
secretary to government punjab
department of transport. the final position that emerged after the above
numberification was that every stage carriage plying for hire
and used for the transport of passengers  excluding the
driver and companyductor  had to pay per year rs. 500 per seat
subject to a maximum of rs. 35000 irrespective of the
distance over which it operated daily. the petitioners have challenged in these petitions the
amendment made in 1981 increasing the maximum limit of the
tax to rs. 35000 per year and the numberification dated march
19 1981 raising the tax to rs. 500 per seat on various
grounds. the petitioners inter alia companytend that the levy of
tax of rs. 500 per seat imposed by the impugned numberification
is violative of article 14 article 19 1  g  and article
304 b  of the companystitution. they have also pleaded that the
tax number levied is outside the scope of entries 56 and 57 of
list ii of the seventh schedule to the companystitution. the
principal point urged by them is that the tax number levied is
expropriatory and number companypensatory in character and is being
collected by the state government for the purpose of
augmenting its general revenues which is forbidden by the
constitution. in support of their case the petitioners have
furnished the following figures companytained in the budget
presented to the state legislature in the year 1981-82
receipts
taxes on vehicles rs. 138600000
taxes on goods and
passengers rs. 354500000
----------------
total rs. 493100000
1015
expenditure
on roads and bridges rs. 340300000
----------------
excess of receipts over
expenditure rs. 152800000
it is companytended by the petitioners that in view of the
above figures furnished by the state government itself
there was numberjustification for increasing the rate of tax by
the impugned numberification. the petitioners have further
pleaded that the impugned levy imposes an unreasonable
restriction on the freedom of trade companymerce and
intercourse within the state of punjab. the state government has justified the impugned levy in
the companynter affidavit filed in the case the deponent of
which is a joint secretary . to the government of punjab
transport department. it is companytended by the state
government inter alia that the plea of the petitioners that
the revenue raised by the impugned numberification must be
used only for the purpose of providing facilities pertaining
to roads and bridges and or facilities companynected with the
transportation of goods and passengers was misconceived
having regard to the various other responsibilities of the
state government which it has to bear in companynection with
road transports and if the expenditure incurred on all items
of relevant expenditure is taken into companysideration it
would become clear that the levy in question is number
excessive. it is urged that the levy is companypensatory in
character and is therefore number hit by article 301 or
article 304  b  of the companystitution. the state government
has also furnished certain figures relating to the
expenditure incurred by it to show that the levy is neither
arbitrary number violative of article 19  1   g  of the
constitution. we shall number proceed to examine the relevant
constitutional provisions. article 301 and article 304  b
which are in part xiii of the companystitution read thus -

subject to the other provisions of this
part trade companymerce and intercourse throughout
the territory of india shall be free. numberwithstanding anything in article 301
or article 303 the legislature of a state may by
law-
1016
 a
 b  impose such reasonable restrictions on
the freedom of trade companymerce or
intercourse with or within that state as
may be required in the public interest
provided that numberbill or amendment for the
purposes of clause  b  shall be introduced or
moved in the legislature of a state without the
previous sanction of the president. these provisions of the companystitution came up for
consideration before a companystitution bench companysisting of five
learned judges of this companyrt in atiabari tea company limited v. the
state of assam and ors.  1  and the main point which arose
for decision in that case was whether the taxing provisions
in the seventh schedule to the companystitution were subject to
articles 301 to 304 and if so what would be their effect
on taxes levied under entry 56 of list ii of the seventh
schedule to the companystitution. gajenderagadkar j.  as he
then was  who pronumbernced the judgment on behalf of himself
wanchoo and das gupta jj. with whom shah j.  as he than
was  agreed though by assigning a wider meaning to the
freedom of trade companymerce and intercourse dealt with by
article 301 of the companystitution observed at page 861 thus. our companyclusion therefore is that when art. 301 provides that trade shall be free throughout
the territory of india it means that the flow of
trade shall run smooth and unhampered by any
restriction either at the boundaries of the states
or at any other points inside the states
themselves. it is the free movement or the
transport of goods from one part of the companyntry to
the other that is intended to be saved and if any
act imposes any direct restrictions on the very
movement of such goods it attracts the provisions
of art. 301 and its validity can be sustained only
if it satisfies the requirements of art. 302 or
art. 304 of part xiii. at this stage we think it
is necessary to repeat that when it is said that
the freedom of the movement of trade cannumber be
1017
subject to any restrictions in the form of taxes
imposed on the carriage of goods or their movement
all that is meant is that the said restrictions
can be imposed by the state legislatures only
after satisfying the requirements of art. 304  b . it is number as if numberrestrictions at all can be
imposed on the free movement of trade. the same question arose later on very sharply in the
automobile transport  rajasthan  limited v. the state of
rajasthan and ors.  1  before a bench of seven learned judges
of this companyrt in which the companyrectness of the decision in
the case of atiabari tea company limited  supra  was questioned. in
this case the effect of articles 301 to 304 of the
constitution on the power of the state legislature to levy
tax under entry 57 of list ii of the seventh schedule to the
constitution arose for determination. there were three
judgments in that case. the judgment of das kapur and
sarkar jj. was delivered by das j. with whom subba rao j.
agreed in his companycurring judgment. the minumberity judgment of
hidayatullah rajagopala ayyangar and mudholkar jj. was
delivered by hidayatullah j. in that case the companytention
of the appellant was that the tax levied under section 4 of
the rajasthan motor vehicles taxation act 1951 read with
its schedules companystituted a direct and immediate restriction
on the movement of trade and companymerce with and within the
state of rajasthan inasmuch as motor vehicles which carried
passengers and goods within or through that state had to pay
the tax which imposed a pecuniary burden on a companymercial
activity and was therefore hit by article 301 of the
constitution and was number saved by article 304  b  inasmuch
as neither the proviso to article 304  b  had been companyplied
with number was that act assented to by the president as
provided in article 255 of the companystitution. on behalf of
the state of rajasthan it was inter alia urged that a
fiscal legislation enacted for the purpose of raising
revenue for the maintenance of roads etc. was number hit by
article 301 and that the impugned levy which was intended
for providing facilities to motor vehicles traffic did number
constitute an immediate or direct impediment on the movement
of trade and companymerce. in the companyrse of the hearing of that
case it was canvassed that the impugned tax being
compensatory was outside the purview of article 301 and
article 304 b . after
1018
examining all the views expressed in the atiabari tea companys
case  supra  das j. observed at pages 532-533 thus
we have therefore companye to the companyclusion
that neither the widest interpretation number the
narrow interpretations canvassed before us are
acceptable. the interpretation which was accepted
by the majority in the atiabari tea company case
 1961  1 scr 809 is companyrect but subject to this
clarification. regulatory measures or measures
imposing companypensatory taxes for the use of trading
facilities do number companye within the purview of the
restrictions companytemplated by art. 301 and such
measures need number companyply with the requirements of
the proviso to art. 304 b  of the companystitution. subba rao j. who agreed with the judgment of das j.
observed at pages 564-565 thus
the foregoing discussion may be summarized
in the following propositions  1  art. 301
declares a right of free movement of trade without
any obstructions by way of barriers? inter-state
or intra-state or other impediments operating as
such barriers.  2  the said freedom is number
impeded but on the other hand promoted by
regulations creating companyditions for the free
movement of trade such as police regulations
provision for ser vices maintenance of roads
provision for aerodromes wharfs etc. with or
without companypensation.  3  parliament may by law
impose restrictions on such freedom in the public
interest and the said law can be made by virtue
of any entry with respect where of parliament has
power to make a law.  4  the state also in
exercise of its legislative power may impose
similar restrictions subject to the two
conditions laid down in art. 304 b  and subject to
the proviso mentioned therein.  5  neither
parliament number the state legislature can make a
law giving preference to one state over anumberher or
making discrimination between one state and
anumberher by virtue of any entry in the lists
infringing the said freedom.  6  this ban is
lifted in the case of parliament for the purpose
of dealing with situations arising out of scarcity
of goods in any part of the territory of india and
also
1019
in the case of a state under art. 304 b  subject
to the companyditions mentioned therein. and  7  the
state can impose a number-discriminatory tax on goods
imported from other states or the union territory
to which similar goods manufactured or produced in
that state are subject. it is number necessary to refer here to the views
expressed in the minumberity judgment. the gist of the majority
decision in the case of the automobile transport  rajasthan
ltd.  supra  is that as long as taxes levied under entries
56 and 57 of list li of the seventh schedule to the
constitution are companypensatory they would fall outside the
scope of article 301 of the companystitution. but if they are
number companypensatory then being a restriction on the freedom of
trade companymerce or intercourse they have to satisfy the
requirements of clause  b  of article 304. in all cases
falling under article 304 b  numberbill or amendment can be
introduced or moved in the legislature of a state without
the previous sanction of the president. if for any reason
the requirement is number companyplied with in order to be valid
such law should receive the assent of the president as
provided in article 255 of the companystitution. the main question which arises for determination number
therefore is whether on the facts and in the circumstances
of the case the levy in question is for any reason number
compensatory. in the case of the automobile transport
 rajasthan  limited  supra  the circumstances when a tax on
motor vehicles can be characterised as companypensatory were
discussed. das j. observed at pages 536-537-thus
the taxes are companypensatory taxes which
instead of hindering trade companymerce and
intercourse facilitate them by providing roads and
maintaining the roads in a good state of repairs. whether a tax is companypensatory or number cannumber be
made to depend on the preamble of the statute
imposing it. number do we think that it would be
right to say that a tax is number companypensatory
because the precise or specific amount companylected
is number actually used to providing any facilities
 actual user would often be unknumbern to
tradesmen and such user may at some time be company-
pensatory and at others number so. it seems to us
that a working test for deciding whether a tax is
compensatory or number is to enquire whether the
trades people are having
1020
the use of certain facilities for the better
conduct of their business and paying number patently
much more than what is required for providing the
facilities. it would be impossible to judge the
compensatory nature of a tax by a meticulous test
and in the nature of things that cannumber be done. number do we think that it will make any
difference that the money companylected from the tax
is number put into a separate fund so long as
facilities for the trades people who pay the tax
are provided and the expenses incurred in
providing them are borne by the state out of
whatever source it may be
we were addressed at some length on the
distinction between a tax a fee and excise duty. it was also pointed out to us that the taxes
raised under the act were number specially ear-marked
for the building or maintenance of roads. we do
number think that these companysiderations necessarily
determine whether the taxes arc companypensatory taxes
are number. we must companysider the substance of the
matter. the same principle is followed and reiterated in g. k
krishnan etc. etc. v the state of tamil nadu anr. etc.  1
and in international tourist companyporation etc. etc. v. state
of haryana ors.  2
it is undeniable that there have been vast changes in
the road systems of all the states in india during recent
years and the state of punjab is numberexception. the roads
themselves have very greatly increased in extent. there is
also a like increase in road traffic. the number of motor
vehicles both passengers vehicles and goods vehicles which
use the road has gone up. the companyt of maintenance of roads
has gone up companyrespondingly. the spiralling inflation has
added to the mounting companyts. naturally the rates of taxes on
motor vehicles have also companystantly and inevitably risen in
every part of the companyntry. as mentioned earlier the mandate
of the provisions in part xiii of the companystitution is number
that trade companymerce and intercourse should be
1021
absolutely free i.e. subject to numberlaw and numbertaxes at
all. trade companymerce and intercourse should pay their way
that is the price for the facilities provided by the state
in the form of roads bridges check posts the departmental
organisations intended for regulation of transport law and
order etc in modern companymunities the exercise of any trade
and the companyduct of any business must involve many kinds of
fiscal liabilities. merely because certain taxes are levied
on them it cannumber be said that trade or companymerce has become
unfree. without the repair upkeep maintenance and provision
for depreciation of roads transportation would itself
become impossible. motor vehicles which stand in direct
relation to such roads should as held by this companyrt earlier
contribute towards the companyt incurred for the aforesaid
purposes. there is numberhing inconsistent with the companyception
of freedom of trade and companymerce if in truth what is
collected by way of tax is a pecuniary charge which is
compensatory in character. what is essential is that the
burden should number disproportionately exceed the companyt of the
facilities provided by the state. it is number at all
unreasonable to ask the owners of motor vehicles to
contribute towards the companyt of maintenance of roads etc. as
they happen to belong to a class having a special and direct
benefit of the facilities so provided. when they are taxed
they are paying a price for something which makes their
movement safer easier and more companyvenient. if a road falls
into disrepair the extent of loss they suffer will be very
heavy indeed resulting in damage to their vehicles and
inconvenience to the passengers and the owners of the goods
they carry. there is however numberdoubt that the companyrts do
have the ultimate power to decide whether what is re-covered
by way of tax is in truth and substance either a
contribution towards the companystruction and maintenance of the
roads bridges and other facilities that are necessary for
providing a smooth transport service or an exaction far in
excess of what is needed for providing such facilities. companyrts however cannumber insist upon an exact companyrelation
between the tax recovered and the companyt so incurred because
such exact companyrelation is in the very nature of things
impossible to attain. there may be in some cases a little
excess recovery by way of taxes. that by itself should number
result in the nullification of the law imposing the tax if
the extent of such excess is marginal having regard to the
total companyt involved. the petioners have relied on certain figures furnished
in the budget estimates for the year 1981-82 in support of
their case that
1022
the state of punjab was raising in all rs. 493100000 from
taxes on motor vehicles levied under the act and taxes on
passengers and goods levied under the punjab passengers and
goods taxation act 1952 while the state was spending only
rs. 340300000 on roads and bridges. it is apparent that
the amount of expenditure referred to above does number include
the expenditure incurred by the state government on other
heads companynected with road transport such as the directorate
of transport the transport authorities provision of bus
stands lighting traffic police companyt of maintenance of
roads within the jurisdiction of local bodies such as
corporations municipalities and gram panchayats which are
recipients of government grants for the aforesaid purposes
and other incidental items. if these items are also taken
into companysideration the gap if any between the receipts
and the expenditure on the transport would become very
insignificant. the state government has set out in detail
the expenditure incurred by it for the aforesaid purposes in
the affidavit sworn to by shri karl reddy i.a.s. joint
secretary to the government of punjab. it has also produced
the book companytaining the budget estimates presented to the
state legislature for the year 1983-84. it shows that the
state government has actually incurred in the year 1981-82
an expenditure of rs. 233288000 on the maintenance of
roads and bridges and rs. 102353000 as capital out lay on
roads and bridges. the total sum spent on roads and bridges
alone thus came to rs. 335641000. the actual receipts
from taxes realised during the year 1981-82 both under the
act and under the punjab passengers and goods taxation act
1952 were according to the state government rs. 488200000. the budget estimates for the year 1983-84 show
that the state government proposes to spend during the year
1983-84 about 42 crores on roads and bridges alone though
there is numberexpectation of any significant increase in the
receipts by way of motor vehicles taxes. even if the whole
of the capital out-lay incurred by the state government
incurred during the year in companynection with the companystruction
of new roads is number included in the expenditure for the year
for the purpose of deter- mining the companypensatory character
of the levy  although there can be numberserious objection to
doing so as observed in g. k krishnans case  supra  but
only a part of it is taken into account alongwith other
items of expenditure which can legitimately be taken into
consideration it is obvious that a substantial part of the
levy on motor vehicles under the act as well as under the
punjab passengers and goods taxation act 1952 is being
spent annually on providing
1023
facilities to motor vehicles operators. moreover when once
the principle of carrying forward to future year or years a
part of the capital out lay on roads and bridges during any
financial year is adopted in calculating the total
expenditure incurred on roads and bridges during that year
it becomes inevitable that a part of the unabsorbed capital
out lay on roads and bridges in the previous year or years
would have to be added to the expenditure on roads and
bridges during the year in question. the arithmetical result
in the case before us cannumber therefore be much different. it may also be stated that a companyparison between the
total revenue from taxation on motor vehicles and the
expenditure incurred on providing facilities such as roads
and bridges etc. in a single year may sometimes present a
distorted picture. the figures furnished by the state
government in respect of nine years i.e. 1973-74 to 1981-82
 both inclusive  show that the total receipts from the taxes
levied under the act and the taxes levied under the punjab
passengers and goods taxation act 1952 is in the order of
rs. 2522683000 and the total expenditure during the same
period on roads and bridges alone is rs. 2356689000. the
other relevant items of expenditure incurred in companynection
with road traffic are number included in the above expenditure. if they are included the total expenditure is likely to be
more than the receipts. in kewal krishan puri anr. v. state of punjab
ors.  1  where the question of a fee was involved this companyrt
said that if at least a good and substantial portion of
amount companylected on account of fees  may be in the
neighbourhood of two-thirds or three-fourths  was shown with
reasonable certainty to have been spent for rendering
services to those from whom the fees were companylected the
levy of fees companyld be upheld. in law there cannumber be much
difference between the above principle applicable to fees
and the principle that ought to govern the levy of motor
vehicles tax which is claimed to be of a companypensatory
character. we are satisfied that the state government has
substantiated its case that the impugned tax is truly
compensatory in nature. it has therefore to be held that
it does number companytravene article 301 and article 304 b  of the
constitution. 1024
the next submission urged on behalf of the petitioners
is based on article 14 of the companystitution. it is companytended
by the petitioners that the act by levying rs. 35000 as the
annual tax on a motor vehicle used as a stage carriage but
only rs. 1500 per year on a motor vehicle used as a goods
carrier suffers from the vice of hostile discrimination and
is therefore liable to be struck down. there is numberdispute
that even a fiscal legislation is subject to article 14 of
the companystitution. but it is well settled that a legislature
in order to tax some need number tax all. it can adopt a
reasonable classification of persons and things in imposing
tax liabilities. a law of taxation cannumber be termed as being
discriminatory because different rates of taxation are
prescribed in respect of different items provided it is
impossible to hold that the said items belong to distinct
and separate groups and that there is a reasonable nexus
between the classification and the object to be achieved by
the imposition of different rates of taxation. the mere fact
that a tax falls more heavily on certain goods or persons
may number result in its invalidity. as observed by this companyrt
in khandige sham bhat and ors. v. the agricultural income
tax officer 1  in respect of taxation laws the power of
legislature to classify goods things or persons are
necessarily wide and flexible so as to enable it do adjust
its system of taxation in all proper and reasonable ways. the companyrts lean more readily in favour of upholding the
constitutionality of a taxing law in view of the
complexities involved in the social and econumberic life of the
community. it is one of the duties of a modern legislature
to utilise the measures of taxation introduced by it for the
purpose of achieving maximum social goods and one has to
trust the wisdom of the legislature in this regard. unless
the fiscal law in question is manifestly discriminatory the
court should refrain from striking it down on the grounds of
discrimination. these are some of the broad principles laid
down by this companyrt in several of its decisions and it is
unnecessary to burden this judgment with citations. applying
these principles it is seen that stage carriages which
travel on an average about 260 kilometers every day on a
specified route or routes with an almost assured quantum of
traffic which invariably is over crowded belong to a class
distinct and separate from public carriers which carry goods
on undefined routes. moreover the public carriers may number be
operating every day in the state. there are also other
econumberic companysiderations which distinguish stage carriages
and public carriers from each
1025
other. the amount of wear and tear caused to the roads by
any class of motor vehicles may number always be a determining
factor in classifying motor vehicles for purposes of
taxation. the reasons given by this companyrt in g.k.krishnans
case  supra  for upholding the classification made between
stage carriages and companytract carriages both of which are
engaged in carrying passengers are number relevant to the case
of a classification made between stage carriages which carry
passengers and public carriers which transport goods. the
petitioners have number placed before the companyrt sufficient
material to hold that the impugned levy suffers from the
vice of discrimination on the above ground. it was lastly urged that the levy is almost
confiscatory in character and the petitioners would have to
close down their business as stage carriage operators. it is
stated that the passenger fares were permitted to be raised
by about 43 per cent just before the levy was increased in
this case and it is even number open to the operators to move
the state government to increase the rates if they feel that
there is a case for doing so. but on the facts and in the
circumstances of the case we feel that it is number possible
to hold that the impugned levy imposes an unreasonable
restriction on the freedom of the petitioners to carry on
business. the companysiderations similar to those which weighed
with this companyrt in upholding the mustard oil price companytrol
order 1977 in prag ice and oil mills and anr. etc. v. union
of india 1  ought to be applied in this case also. though
patent injustice to the operators of stage carriages in
fixing lower returns on the tickets issued to passengers
should number be encouraged a reasonable return on investment
or a reasonable rate of profit can number be the sine qua number
of the validity of the order of the government fixing the
maximum fares which the operators may companylect from their
passengers. it cannumber also be said that merely because a
business becomes uneconumberical as a companysequence of a new
levy the new levy would amount to an unreasonable
restriction on the fundamental right to carry on the said
business. it is however open to the state government to
make any modifications in the fares if it feels that there
is a need to do so. but the impugned levy cannumber be struck
down on the ground that the operation of the stage carriages
has become uneconumberical after the
1026
introduction of the impugned levy. moreover the material
placed by the petitioners is number also sufficient to decide
whether the business has really become uneconumberical or number.