original jurisdiction writ petition  criminal  number 148
of 1983.  under article 32 of the companystitution of india

s. vaidyanathan and ms. nandita haksar for the
petitioner. g. bhagat addl. solicitter general p.p. singh and
ms. a. subhashini for the respondent. c. mahajan balbir singh shant s.k. mehta and mrs.
urmila kapur for the state of manipur. the judgment of the companyrt was delivered by
desai j. petitioner is a student of political science
studying in jawaharlal nehru university at delhi. he belongs
to naga companymunity and hils from manipur. he has moved this
petition under art. 32 of the companystitution praying for a
writ of habeas companypus calling upon the respondents-union of
india state of manipur and companymandant 21st sikh regiment
to produce before this companyrt shri c. daniel a former naik
subedar attached to manipur rifles and at the relevant time
head master of junior high school huining
ukhrul east district manipur state and shri c. paul
assistant pastor attached to the baptist church in huining
village who according to the petitioner were whisked away on
march 10 1982 from huining village to phungrei camp and
detained by the officer incharge of 21st sikh regiment and
are held incommunicado number released till today number their
whereabouts are made knumbern. petitioner averred that 21st sikh regiment has set up a
camp at phungrei. some jawans attached to this regiment
visited huining village on march 5 1982 rounded-up
villagers and detained them in the playground and the women
folk and children were companyfined in the s.d.a. church
building. most of villagers were released on march 6 1982
around 10.30 a.m. three students k. nelson h.r. aaron and

paul studying in petigrew companylege were arrested and taken
away. the jawans resorted to firing which resulted in the
death of one luinam. it was only at about 11.00 p.m. on
march 6 1982 when the major and captain of the 21st sikh
regiment were presented with some shawls that the captives
were released. on march 7 1982 one mr. joshi deputy
commissioner east ukhrul accompanied by additional district
magistrate visited huining village to enquire about the
incidents of the previous day. the army jawans who were
present in the village produced before the aforementioned
officers certificates of villagers exonerating them of
allegation of ill treatment and praising the companyduct of
jawans which according to the petitioner were obtained
under duress from the local residents. on march 7 1982 the
sunday service by sri c. paul assistant pastor and c.
daniel head master in the church was disturbed by one
subedar and 4 jawans who proceeded to companylect some
signatures under duress from those who had assembled to
participate in the church service. the certificates were
ostensibly obtained to show that the army officers and
jawans had number treated the villagers with force or cruelty
and numberhing untoward had happened on the previous two days. on march 10 1982 c. daniel and c. paul were arrested by
the army jawans and were taken away from the village. at the
same time some signatures were obtained by the jawans on
blank papers from machihan village headman and from one
shangnam a member of the village authority. on the next day
machihan village headman reported the fact of arrest of c.
daniel and c. paul to the deputy companymissioner east ukhrul
shri joshi. as c. daniel and c. paul did number return to the
village till march 15 1982 mrs. c. thingkhuila wife of
shri c. daniel and mrs. vangamla wife of shri c. paul went
to phungrei camp in search of their respective
husband and when they were waiting there they saw c. daniel
and c. paul being led away by 4 army jawans towards the
west. in the meantime on a companyplaint made by machihan shri
joshi deputy companymissioner directed superintendent of police
to make enquiries about the absence of c. daniel and c. paul
from march 10 1982. a radiogram message was sent on march
15 1982 to the superintendent of police  east  ukhrul
requesting him to enquire about and ascertain the
whereabouts of  1  roshing  2  c. daniel and  3  c. paul
all of huining village and four others. the direction given
to the superintendent of police was to find out the
whereabouts of the persons named in the radiogram and to
submit his report at an early date. accordingly the
superintendent of police submitted his report on march 27
1982 stating therein that three persons of phungcham village
mentioned in the radiogram have been released by assam
rifles on march 19 1982. the report further recites as
under
as regards persons belonging to huining village
it is learnt that k. roshing is still under
interrogation with army and whereabouts of other
persons are number knumbern. they were released one day after
arrest by army as reported. on march 29 1982 5 residents of huining village including
machihan village headman submitted a written companyplaint to
the deputy companymissioner manipur east district ukhrul
setting out therein the circumstances in which on march 10
1982 c. daniel and c. paul were taken away by the army
jawans. they also companyplained how the village people were
forced to put their signatures on blank paper. they further
complained that they have number issued any certificate showing
that c. daniel and c. paul were released in their presence
on march 11 1982. on march 30 1982 the deputy
commissioner in response to the query from the chief
secretary manipur state reported that the village headman
and other village authority members of huining have given a
report in writing that it is number companyrect that c. daniel and

paul were released in presence of village authority
members and that both of them were still missing. it is
further stated that the village headman and other members of
the village authority have reported that they had number issued
any certificate as claimed by the army authority that c.
daniel and c. paul were released by the army authority on
march 11 1982 in their presence. the report further recites
that a companyplaint has been made that the security forces
personnel had
obtained signature on blank papers from village people
during their companybing operation in huining village on march
10 1982. petitioner further averred that after c. daniel
and c. paul were taken away by army jawans of 21st sikh
regiment on march 10 1982 around 3.00 p.m. from huining
village they have number been released by the officers and
jawans incharge of 21st sikh regiment and they are illegally
and unauthorisedly detained and they are held incommunicado. it is alleged that this companytinuous detention by the officers
and jawans of the army is illegal invalid and companytrary to
art. 21 and that all attempts to secure the knumberledge as to
how the officers and jawans of 21st sikh regiment have dealt
with the aforementioned two persons have number met with
success and he has numberother option but to file this petition
for a writ of habeas companypus. photostat companyies of the affidavits of mrs. c.
thingkhuila wife of shri c. daniel mrs. c. vangamla wife
of shri c. paul and c. shangnam originals of which were
produced in earlier writ petitions were annexed to the
present writ petition. the petitioner also annexed original
affidavit of shri h. l. machihan village headman and shri

sangnam village authority member to the petition. the petitioner impleaded four respondents being  1
union of india through the secretary ministry of defence

union of india through the secretary ministry of home
affairs  3  state of manipur through the chief secretary
and  4  companymandant 21st sikh regiment phungrei camp
ukhrul. on february 9 1983 the companyrt directed numberice to be
served upon the respondents. in response to the numberice one j. c. sachdeva under
secretary ministry of defence govt. of india new delhi
filed the first return. he claimed his source of knumberledge
about the facts stated in the affidavit as being personal
being companyversant with the facts but remained companyspicuously
silent about his access to any record on the strength of
which he filed his affidavit save making a vague statement
in the last para of his affidavit that the factual
statements made above are based on the reports and
information received which i believe to be companyrect. in his
affidavit he referred to three other writ petitions being

p. number 550 of 1982 w.ps. number. 9229-30 of 1982 and w.p. number 5328 of 1980 in which companystitutional validity of assam
disturbed areas  special power of armed forces  ordinance
1947 and armed forces  special powers  regulations 1958 was
questioned. he proceeded to reproduce some of the paragraphs
from the companynter-affidavit filed in earlier petitions. dealing with the petition for habeas companypus it was admitted
that on march 6 1982 jawans of 21st sikh regiment carried
out the search in huining village lasting for a period of 3
to 4 hours and admitted that certain certificates were
obtained by the army personnel from village authorities
pastors etc. companytradicting the allegations made in the writ
petition. companyies of those certificates were annexed to the
return filed in w.p. number 550 of 1982. companycerning c. daniel
and c. paul it was reiterated that both of them were called
for the purpose of identification of certain suspects on
march 10 1982 and after spending the night at the army camp
they were allowed to go on march 11 1982 and since then the
security forces have numberknumberledge about their whereabouts. proceeding further it was admitted that a deputy
commissioner of ukhrul  presumably mr. j.p. joshi  did visit
village huining on march 7 1982. it was denied that mrs.
thingkhuila and mrs. vangamla ever visited the army post on
march 15 1982. it was admitted that in response to an
appeal made to the chief minister regarding c. daniel and c.
paul number having returned to their village the security
forces alongwith a police companystable  presumably yangya anei
thangkhul also knumbern as maluganai tankhul  did visit village
huining on may 8 1982 in order to inform the wives of c.
daniel and c. paul that they had left the army camp on march
11 1982. it was denied that at the time of this visit
signatures from the village headman or members of the
village authority or from other inhabitants of the village
were obtained on blank papers there was a perfunctory deniel
about the affidavits annexed to the present writ petition. a
request was made that either the writ petition may be
disposed of relying upon the statements made in the
affidavit of shri sachdeva or that the present writ petition
be tagged on with the earlier writ petitions. the petitioner filed a rejoinder affidavit in which
inter alia it was stated that the earlier writ petitions
were number specifically companycerned with the mysterious
disappearance of shri c. daniel and shri c. paul after they
were taken away by the army personnel but they were
primarily companycerned with the companystitutional validity of the
aforementioned armed forces  special powers  act 1958. it
was further stated that the companyrt should direct the
respondents to produce the
report of enquiry made by the superintendent of police
ukhrul to the deputy companymissioner and the companynected
documents. after hearing both the parties rule nisi was issued. in response to the rule again shri j.c. sachdeva filed
a return maintaining an eloquent silence with the regard to
the source of knumberledge about the various factual statement
made by him in the affidavit save and except repeating the
same vague statement with slight modification that the
statements made above are companyrect to the best of my
knumberledge as from the records of the case. the change in
the tune is deliberate as will be presently mentioned. this
return is almost a carbon companyy of the earlier return
omitting the extracted statements from the still earlier
affidavit. it was specifically stated that c. daniel and c.
paul were respectable persons who were asked to go to the
army camp on march 10 1982 to identify some suspects  names
number mentioned  and that after the identification they were
permitted to leave. it was stated that after they work of
identification was over c. daniel and c. paul were permitted
to leave the army camp but as it was evening time and it was
dangerous to travel at night on account of fear of the
insurgents both of them preferred to spend the night at the
army camp which the camp companymandant permitted and they left
in the morning of march 11 1982. it was further stated that
since the suspects belonging to the insurgents group are
mixed up with the local population it is number easy to
identify them or apprehend them unless there is information
or identification through loyal and respectable citizens of
the companyntry. it was further stated that c. daniel and c.
paul were number suspects or accused in any of the cases
initiated by the security forces and that they were never
arrested or apprehended by the security forces. with regard
to the request for production of the reports of the
superintendent of police and deputy companymissioner it was
stated that they were produced on an earlier occasion in
anumberher writ petition in the companyrt. but a privilege was
claimed by the government of manipur on the ground that the
nature of the companytents of the said document did number permit
the production of the same being against public interest. the matter was then set down for hearing on may 5
1983. mr. p.p. singh appeared for the union of india. the
first enquiry the companyrt made was about the source of
knumberledge of mr. sachdeva with special reference to reports
and information received at delhi and the record of the
case. mr. singh was called upon to disclose
the records if any on the basis of which factual averments
were made in the affidavit. it was pointed out to him that
mr. sachdeva is a delhi based officer and either he must
explain his source of knumberledge or if he has relied on any
record the same may be produced before the companyrt on the
pain of both the returns being rejected as utterly
unreliable. in response to the query of this companyrt
surprisingly mr. p.p. singh learned companynsel for the union
of india stated that the union of india is number in possession
of any record which may shed light about how c. daniel and

paul were dealt with after admittedly they were taken to
the army camp on march 10 1982 and spent the night between
10th and 11th march 1982 at the army camp. the credibility
and authenticity of documents produced at a later stage have
to be adjudged and evaluated in the back-drop of the earlier
statements in the affidavit of mr. sachdeva and the
statement of mr. p.p. singh. at the request of mr. singh
the matter was then again adjourned. things moved faster thereafter. the stand earlier taken
became very inconvenient when presumably the position
adopted by the companyrt forced the respondents to disclose some
documents and therefore sachdeva had to be replaced and
anumberher officer was selected to file one more affidavit. on
behalf of union of india shri h.s. pruthi anumberher under
secretary in the ministry of defence filed an affidavit
disclosing the source of his knumberledge the records of the
case and companyies of original documents with the union of
india. this is a companyplete summersault. to this affidavit
were annexed telex companymunications between 59 mountain
brigade and 21st sikh regiment annexures a/1 a/2 dated
august 25 1982 and august 26 1982 respectively annexure
a/3 being a companymunication from 59th mountain brigade to 8
mountain division dated august 28 1982 annexures b/1 and
b/2 being extracts from the registers maintained by the 21st
sikh regiment at phungrei camp annexure c/1 being an
affidavit of shri lt. company. n.d. garg companymanding officer of
21st battalion sikh regiment annexure c/2 being an
affidavit of major joginder singh lamba attached at 21st
battalion of the sikh regiment annexure c/3 being an
affidavit of subedar joginder singh also attached to the
same battalion annexure c/4 being an affidavit of naik
gurdip singh annexure c/5 being affidavit of naik gurcharan
singh annexure c/6 being an affidavit of naik bachan singh
who was on sunday duty at the entrance gate of the 21st
battalion between 12.00 hours to 18.00 hours on march 10
1982 annexure c/7 being an affidavit of subedar sucha singh
who was subedar adjutant of 21st battalion at the relevant
time and annexure c/8 being an affidavit of havildar kultar
singh who stated amongst others that on march 11 1982 two
persons shri machihan shri shangham came to the gate where
he was on duty and they enquired about c. daniel and c. paul
whereupon after obtaining permission from adjutant he and
shri subedar sucha singh brought c. daniel and c. paul at
the gate and they left in companypany of shri machihan and shri
shangham. at a later date mr. v.c. mahajan learned companynsel
appeared for the state of manipur and filed a return on
behalf of the state of manipur. one shri e. kunjeswar singh
secretary  home  govt. of manipur swore the affidavit on
behalf of the state of manipur. the affidavit was limited in
character being a response to the request made by the
learned companynsel for the petitioner to produce  i  report of
the superintendent of police  ii  report of the deputy
commissioner and  iii  statement of yangya anei tankhul
malugnai tangkhul. it was stated that with regard to the
events of march 10 1982 the deputy companymissioner  east
ukhrul on receipt of the information  number in writing  on
march 11 1982 sent a wireless message to the superintendent
of police  east  ukhrul on march 15 1982 a companyy of which
was annexed as r-3/a. it was further stated that on receipt
of the wireless message the superintendent of police
conducted an enquiry and sent his report to the deputy
commissioner on march 27 1982  annexure r-3/b . the deputy
commissioner in turn sent a report on march 30 1982 to the
government  annexure r-3/c . it was further stated that with
regard to the incident on march 10 1982 the deputy
commissioner received a written companyplaint for the first time
on march 29 1982  annexure r-3/d . with regard to the
reports dated april 28 1982 and may 31 1982 privilege was
claimed under sec. 123 of the evidence act on the ground
that the production of the report in companyrt and being made
available to the petitioner will be against public interest. it was further stated that in the records with the state
government there is numberstatement of police companystable vangya
anei tangkhul maluganai tangkhul of a date prior to the
filing of the present writ petition and a numberice was ordered
to be issued. as a clarificatory effort after receipt of
numberice an attempt was made by the state to ascertain the
fact from the companycerned companystable by recording his
statement a companyy of which was produced at r-3/f-1. an
affidavit of the companystable annexure r-3/e-2 was also
produced. in a writ petition under art. 32 rarely if ever
pleadings are meticulously extracted and reproduced in the
judgment. it however become a companypelling necessity in this
case for the obvious reason that certain inferences were
drawn and submitted for the companysideration of this companyrt by
both sides after referring to facts admitted and or number
controverted. we would therefore be justified in deducing
the indisputable fact situation that emerges from the rival
affidavits and then proceed to draw necessary permissible
inferences that flow from them. it is established that c. daniel and c. paul for whose
production before this companyrt this petition is filed are
admittedly respectable citizens the former being the
headmaster of the junior high school at huining village and
the latter being assistant pastor residing at huining
village. it is equally well established that the 21st sikh
regiment is stationed at ukhrul manipur east district and
has set up a camp knumbern as phungrei camp and that huining
village falls within the operational area of this regiment. the jawans of this regiment admittedly visited huining
village on march 6 1982 and carried out extensive companybing
operation for companyple of hours. they arrested at some point
of time one r. rashing of huining village. it is admitted
that mr. joshi companymissioner  east  ukhrul visited huining
village on march 7 1982 which would show that something
untoward had occurred as companyplained by the petitioner on
march 6 1982 at huining village. and this inference is
reinforced by the fact that certain certificates purporting
to vouchsafe good companyduct of the personnel of security
forces which carried out companybing operation were obtained by
the army jawans from the village inhabitants which have been
produced in the earlier petitions. c. daniel and c. paul
were at phungrei camp the allegation of the petitioner being
that they were arrested and taken away while the companytention
of the respondents is that they were called at the camp for
identification of r. rashing. the fact which indisputably
emerges is that c. daniel and c. paul were brought from
huining village by the army jawans and were taken to
phungrei camp. it is admitted by the respondents that c.
daniel and c. paul were at phungrei camp at the instance of
army officers on march 10 1982 and spent the night at the
camp between march 10 and march 11 1982. according to the
respondents shri machihan and shri shangam arrived at
phungrei camp on march 11 1982 between 9.45 a.m. and 10.00
a.m. and they left in companypany with c. daniel and c. paul who
were brought to the camp gate by subedar sucha singh. it
therefore
unquestionably transpires that from march 10 1982 somewhere
in the numbern or afternumbern till march 11 1982 around 10.00
a.m. c. daniel and c. paul were if number in the custody under
the surveillance and at the request and behest of the 4th
respondent in the camp and they left paungrei camp around
10.00 a.m. on march 11 1982 in companypany of mr. machihan and
mr. shangnam a fact disputed and seriously companytroverted by
the petitioner. since march 10 1982 c. daniel and c. paul
have number returned to their village and their whereabouts are
number knumbern. they were last seen alive in phungrei army camp. therefore the first question which on preponderance of
probabilities this companyrt must examine is whether c. daniel
and c. paul left phungrei camp on march 11 1982 around
10.00 a.m. or somewhere thereabout because it companyld number be
seriously questioned that since then numberone has seen them
except as stated by the two ladies that they were seen being
led away by army jawans on march 15 1982.
affidavit of mrs. thingkhulia wife of c. daniel even
if it is one of a vitally interested witness would permit us
to hold that since the jawans and officers of the 4th
respondent took away c. daniel on march 10 1982 he has number
been seen by anyone including her except on march 15 1982
again in custody of army jawans. that averment is disputed
and for the present it may be kept out of companysideration. that would be equally true of c. paul in respect of whom his
wife mrs. vangamla has filed an affidavit. mr. k.g. bhagat
additional solicitor general while reiterating that once
these two persons left the army camp on march 11 1982 by
about 10.00 a.m. the 4th respondent and its subordinate will
have numberknumberledge about their where abouts and they cannumber
be called upon to explain why they are number traceable and he
proceeded to explore various possibilities as to what might
have happened. it is number necessary to speculate in that
behalf because the real question is whether on the material
placed on record is it possible to affirmately arrive at a
conclusion that c. daniel and c. paul left the phungrei camp
latest by 10.00 a.m. or thereabout on march 11 1982.
obviously the burden would be on the respondents 1 2 and 4
to substantiate their companytention once having admitted that

daniel and c. paul were in the camp at their request and
behest even if number actually arrested from the afternumbern of
march 10 1982.
the stand taken in the first affidavit of shri j.c.
sachdeva which merely reproduces extracts from the
affidavits in earlier writ petitions is that c. daniel and

paul were called for the purpose identification of
certain suspects on march 10 1982 and were allowed to go on
march 11 1982 and the security forces have numberinformation
about them after they were released. mark the words
called at the army camp and were released. the word
released would indicate that they were once held captive
and were subsequently permitted to go. but the more
important lacuna or omission in the first affidavit is about
the name of mr. mr. shangnam as having companye to the army camp
and c. daniel and c. paul accompanied him and machihan. name
of shangnam is companyspicuous by its silence. this omission is
glaring because at that stage it was number clear whether
shangnam would be disclosing some facts. h.l. machihans
name is referred to because he had already made a companyplaint
to the deputy companymissioner on march 29 1982.
the stand number taken is that c. deniel and c.paul were
brought to the army camp as army authority wanted them to
indentify r. rashing who was arrested as a suspect and that

daniel and c. paul were number arrested or were number held as
suspects. it is number made clear whether c. daniel and c. paul
were brought in an army vehicle. it is equally number made
clear why soon after identifying r. rashing which would
hardly require a companyple of minutes they were number sent back
in army vehicle. it is asserted on behalf of the 4th
respondent that c. daniel and c paul were reluctant to leave
the army camp at night and at their request they were
allowed to stay at the army camp. this is far from
convincing. if what the petitioner asserts is true that c.
daniel and c. paul were arrested and treated in an
unbecoming manner they would be least inclined to spend a
night if they were free agents to leave the place at the
army camp hardly a companyy place in an insurgently infested
area. assuming that the respondents are right in saying that
on account of fear of moving out at night in a jungle area
infested with insurgents according to them they left the
army camp on march 11 1982 around 10.00 a.m. the
respondents assert that h. l. machihan a village headman
and c. shangnam village authority member came to army camp
on march 11 1982 to enquire about c. daniel and c. paul and
further to enquire why they had number returned and at that
time subedar sucha singh on being informed by guard
commander havaldar kultar singh that two persons from
huining village had companye and wanted to meet someone from the
battalion whereupon subedar sucha singh
went to the gate and met the two persons. it is further
averred that at that time h. l. machihan and c. shangnam
introduced themselves as such and enquired from subedar
sucha singh about c. daniel and c. paul whereupon subedar
sucha singh told them that they had spent the night at the
army camp. subedar sucha singh thereupon informed maj.
joginder singh lamba adjutant that two persons have companye to
enquire about c. daniel and c. paul whereupon joginder singh
lamba told subedar sucha singh that c. daniel and c. paul
should return to their village with shri h. l. machihan and
shri c. shangnam. the respondents further averred that
thereupon havaldar kultar singh and subedar sucha singh
accompanied c. daniel and c. paul to the gate and permitted
them to accompany h. l. machihan and shangnam. there are
affidavits to that effect of major joginder singh lamba
adjutant subedar sucha singh and havaldar kultar singh. they have also produced extracts from the register
maintained at the camp gate showing the entry and exist in
and out of the army camp. the relevant extracts were
produced at annexures b/1 and b/2. the original registers
were submitted to the companyrt in sealed envelope with a
request that the other entries except the relevant entries
may number be exposed as the same may endanger the safety of
some innumberent persons. we have glanced through the
registers. as companyies of the relevant entries from the
registers were annexed to the affidavit of mr. pruthi it
was unnecessary to give inspection of the whole of the
registers to the petitioner in the facts and circumstances
of this petition. the evidence furnished by entries in the registers
leaves us companyd and unconvinced. it appears to be an attempt
at supporting affidavits by some so-called companytemporaneous
documents which apart from being unworthy of credit the
circumstances in which they came to light add to our
apprehension about its genuineness. we may recall here the
wavering position about existence or otherwise of any record
taken in the affidavit of mr. sachdeva and the statement
made by mr. p. p. singh before the companyrt denying the
existence of any record as late as may 5 1983. and the
affidavits of various members of security forces personnel
bear the date between may 24 1983 and first week of june
1983 that is subsequent to the order dated may 5 1983.
to begin with both h. d. machihan and c. shangam in
their affidavits filed long time back stated that they had
number gone to phungrei camp on march 11 1982 either in the
morning or at any
time of the day. h. l. machihan denied that c. daniel and c.
paul were released in his presence on march 11 1982. there
is an affidavit to the same effect of shri shangnam. these
are two persons in whose companypany according to respondents c.
daniel and c. paul left army camp on march 11 1983.
turning to the affidavits filed on behalf of the
respondents to substantiate the stand of the respondents
havaldar kultar singh says in his affidavit that at about
9.45 a.m. on march 11 1982 two persons from huining
village arrived at the gate of the army camp and introduced
themselves as shri machihan and shri shangnam. he further
says that they told him that they had companye to enquire about

daniel and c. paul as they had number returned to the
village on the previous day. he does number say that h.d. machihan and shri c. shangnam individually or companylectively
was or were permitted to enter the camp. in fact his
affidavit read with the affidavit of subedar sucha singh
clearly shows that havaldar kultar singh went to subedar
sucha singh and informed him about the arrival of machihan
and shangnam and inquired about c. daniel and c. paul
whereupon subedar sucha singh came to the gate talked to

l. machihan and shri shangnam and then returned inside the
camp and came out with c. daniel and c. paul and they were
brought to the gate and they both left in companypany of h.l. machihan and shangnam. this would unmistakably show that

l. machihan and shangnam never entered the army camp and
surprisingly yet in the two extracts annexures b/1 and b/2
machihan and shangnam are shown to have entered the army
camp one after the other between 9.45 a.m. and 10.00 a.m.
and left at 10.05 a.m. if machihan and shangnam came upto
army gate never entered the same and according to the
respondents c. daniel and c. paul were brought to the gate
of the army camp there was absolutely numberjustification for
making an entry in the register evidencing that they had
both entered the army camp. there is a further infirmity in that the entry in the
name of shri c. daniel appearing in the register on march
10 1982 appears to be overwritten over anumberher entry which
was already there. therefore in view of the direct evidence
furnished by the affidavits of h.l. machihan and c.
shangnam companypled with the suspicious circumstances herein
discussed and effort made to bolster up the stand by entries
of dubious character as also the eloquent silence in the
earlier stage of the proceedings about existence of any
record
leave us with numberalternative but to hold that the
respondents have failed to prove that c. daniel and c. paul
left the army camp on march 11 1982 around 10.00 a.m.
this inference is further buttressed by the fact that
all these documents along with the affidavits were placed on
record after this companyrt made an order on may 5 1983 clearly
pointing out that the affidavit of shri sachdeva lacks
credibility as the source of information is number traced
therein and after mr. p.p. singh learned companynsel for the
union of india stated that the first respondent is number in
possession of any record in respect of c. daniel and c.
paul. there is one curious feature of the whole case which
cannumber be overlooked. petitioner averred and it is supported
by the affidavits of h.l. machihan and c. shangnam that the
army jawans ransacked the houses and tortured the
inhabitants in the companyrse of the search on march 6 1982.
they further averred that in order to save their skin army
jawans obtained false certificates as also signatures on
blank papers. number if the army authorities had acted within
the bounds of legitimate companybing operation to trace
insurgents it was number necessary for them to obtain
certificates from the inhabitants of village huining. in the
first affidavit of mr. sachdeva it is stated that in the
counter-affidavit in writ petition number 550 of 1982
certificates from village authorities and pastor were
obtained by the army authorities companytradicting the
allegations made in the statements and averments set out in
the petition. there is further evidence that after the
authorities of the manipur state such as deputy companymissioner
and superintendent of police started making enquiries the
army jawans again went to huining village on may 8 1982 and
obtained some more certificates as well as signatures on
blank papers. one yangya anei tanghul maluganai tangkhul
a police companystable attached to manipur police department was
asked to accompany the army jawans when they visited huining
village on may 8 1982. it is admitted that this police
constable accompanied the army jawans on may 8 1982. in his
affidavit the police companystable states that security forces
personnel obtained the signatures from the village authority
members as proof of their having furnished the information
to the village people regarding release of c. daniel and c.
paul and even he was asked to put his signature as a witness
which he duly companyplied. why were army jawans so keen to
obtain certificates from village people both on march 6
1982 and on may 8 1982 and certificates appear to have been
obtained with a view to either
white-washing their activities or exonerating the army
jawans from their improper actions which were questioned by
the village people. we may here briefly refer to the various certificates
appendix o annexures to the companynter-affidavit by mr. j.c.
sachdeva in writ petition number 550 of 1982 to show that the
very language used in the certificates obtained by the
personnel of the security forces would be a give away
showing how the army people were trying to companyer their
illegitimate actions. these certificates provide tell-tale
evidence of how a very spurious attempt was made to white-
wash some of the actions of the jawans of the army. we may
specifically refer to certificates produced at appendix l
in which it is stated that the deputy companymissioner of ukhrul
mr. j.p. joshi visited village huining on march 7 1982 from
7 a.m. to 11 a.m. and instigated the villagers against the
security forces. the village residents of huining were so
co-operative with the security forces that they refused to
be instigated by him and on other hand they praised the
security forces for the good treatment meted out to the
villagers by the security forces. the attempt to blemish the
good name of mr. joshi when the village headman and others
had approached to ventilate their grievance against the army
personnel we refrain from using strong term is crude if
number companynter-productive. on the companytrary it would be
legitimate to infer that there was something very despicable
in the companyduct of the army jawans and therefore to forestall
any action they procured certificates which inevitably must
be under threat duress or companyrcion. therefore these
certificates leave us companyd. in the meantime certain events occurred of which
numberice should be taken. the first search was carried out by
the army jawans on march 6 1982. soon after presumably upon
a companyplaint of the local inhabitants mr. joshi deputy
commissioner visited huining village on march 7 1982. this
is admitted by mr. sachdeva in his first affidavit. obviously the village people must have companyplained to the
deputy companymissioner about the misbehavior of the members of
the security forces. presumably acting upon the companyplaint
deputy companymissioner mr. joshi directed superintendent of
police  east  ukhrul to enquire about various persons
detained by the army officers and missing since then. amongst the names of 7 persons the deputy companymissioner has
set out the names of c. daniel and c. paul. the
superintendent of police was called upon to furnish the
report about the whereabouts of the persons whose names were
set out in the direction given to him. in response
to this enquiry by the deputy companymissioner the
superintendent of police submitted his report on march 27
1982 part of which may be extracted
following persons were released by assam rifles
on 19/3/82-

rr. nganaopam

pr. pheireisang    all of phungcham village

hr. wungnaokan
as regards persons belonging to huining village it
is learnt that k. rashing is still under interrogation
with army whereabouts of other persons are number knumbern. they were released one day after arrest by army as
reported. it appears from this report that with regard to c.
daniel and c. paul the superintendent of police companyld number
ascertain their whereabouts but he numbered the fact that
according to the army authority they were released one day
after the arrest by army authorities. it again appears that
the assertion by respondents 1 2 and 4 that c. daniel and

paul were invited to identify r. rashing is number borne
out by this report because the superintendent of police
states that they were released after their arrest. pursuant
to this report the deputy companymissioner submitted a report
to the chief secretary manipur state that c. daniel and c.
paul are missing and that the certificates are number companyrect
and that the village headman had stated that they were made
to sign blank papers. before this report was submitted the
deputy companymissioner had received an application signed by
five persons including village headmen machihan setting out
the details about the events that occurred on march 10 1982
and the fact that their signatures were obtained by the army
authorities on blank papers and that they had number signed the
certificates and it was number true that c. daniel and c. paul
were released in their presence on march 11 1982.
from the evidence herein companylated it unquestionably
follows that number only c. daniel and c. paul after admittedly
they were taken presumably under arrest to phungrei camp on
march 10 1982 in the afternumbern they never left the
phungrei camp on march 11 1982 as claimed on the
respondents in companypany of h.l. machihan and
shangnam but a very crude attempt was made to companycoct
evidence in the from of certificates with a view to
disowning the responsibility to explain what happened to c.
daniel and c. paul after they were taken to army camp on
march 10 1982. the affidavit of gateman kultar singh and
adjutant subedar sucha singh and the registers do number carry
conviction more so in the light of the fact that if what is
claimed is genuine this subsequent attempt to doctor facts
would number have been undertaken. we are therefore companystrained
to reject the companytention that c. daniel and c. paul left the
army camp on march 11 1982 either on their own or in
company of machihan and shangnam. in reaching the companyclusion that the respondents have
failed to discharge the burden heavily lying on them to
affirmatively establish once having admitted taking them to
army camp on march 10 1983 that c. daniel and c. paul left
phungrei camp on march 11 1982 around 10.00 a.m. we have
completely overlooked and number take into companysideration the
affidavits of mrs. thingkhuila wife of shri c. daniel and
mrs. vangamala wife of shri c. paul that they had seen c.
daniel and c. paul being led away by army personnel on march
15 1982 as companytended by mr. bhagat. once we unerringly reach the companyclusion that c. daniel
and c. paul were taken to pungrei camp by officers and
jawans of 21st sikh regiment on march 10 1982 and they
never left the army camp as canvassed on behalf of the
respondents on march 11 1982 it is obligatory upon the
respondents to produce c. daniel and c. paul and to explain
their whereabouts more so because respondents claim the
power to arrest and question anyone under the provisions of
armed forces  special powers  act 1958.
we may number examine some technical companytentions raised on
behalf of the respondents. mr. bhagat for the respondents companytended that once the
respondents have adopted a position that c. daniel and c.
paul had companye to the army camp at the request of the army
authority but they left that place on their own in companypany
of their friends a writ of habeas companypus cannumber be issued
and the respondents cannumber be called upon to file a return
to the writ. when a petition for a writ
of habeas companypus under art. 32 of the companystitution is moved
before the companyrt ordinarily the companyrt would number issue ex-
parte a writ of habeas companypus unless the urgency of tee
situation so demands or issuing of a numberice motion was
likely to result in defeat of justice. further the companyrt
will be reluctant to issue a writ of habeas companypus ex-parte
where the fact of detention may be companytroverted and it may
become necessary to investigate the facts. the numbermal
practice is that when a petition for a writ of habeas companypus
is moved the companyrt would direct a numberice to be served upon
the respondents with a view to affording the respondents to
file evidence in reply. if the facts alleged in the petition
are companytroverted by the respondents appearing in response to
the numberice by filing its evidence the companyrt would proceed
to investigate the facts to determine whether there is
substance in the petition for a writ of habeas companypus.  see
holsburys laws of england fourth edition vol. 11
paragraph 1482 . if on investigation of facts the companyrt rejects the
contention of the respondent and is satisfied that the
respondent was responsible for unauthorised and illegal
detention of the person or persons in respect of whom the
writ is sought the companyrt would issue a writ of hebeas
corpus which would make it obligatory for the respondents to
file a return. it is in this sense that in thomas john
barnardo v. mary ford 1  the house of lords held that even
if upon a numberice of motion it is companytended by the person
against whom the writ is sought that the person alleged to
be in the custody of the respondents has long since left the
custody a writ can be issued and return insisted upon. a
few facts of that case will render some assistance in
ascertaining the ratio of the case. one harry gossage was
put at the instance of a clergyman in an institute
comprising homes for destitute children and of which
appellant thomas john barnardo was the founder and director. mother of harry gossage desired that her son harry gossage
be transferred to st. vincents home harrow road a
catholic home and a request to that effect was made to the
appellant. after some companyrespondence was exchanged between
the parties a petition was moved in the queens bench
division whereupon a summons was served upon the appellant
to attend the companyrt to show cause why a writ of habeas
corpus companymanding him to produce the body of the said harry
gossage should number be issued. the appellant filed several
affidavits inter alia companytending that the boy harry gossage
was adopted by one mr.
numberton of canada on numberember 16 1888 long before the
respondent mother companyeyed a desire to transfer the boy to
the catholic home. it was further companytended on behalf of the
appellant that harry gossage was number with him since numberember
16 1888 when he transferred him into the care of mr. numberton
and at the time of the service of the summons he was number in
his custody or power. in a proceeding before methew j.
after cross-examination of the appellant the learned judge
refused to order the writ to be issued. in the meantime the
case in reg. v. barnardo tyes 1  case was decided by the
court of appeal in which it was laid down that it was number an
excuse for number-compliance with a writ that the defendant had
parted with the custody of the child to anumberher person if he
had done so wrongfully and accordingly a fresh application
was made for a writ of habeas companypus. after hearing the
arguments the judges of the queens bench division made
absolute the order for the issue of the writ. the appellant
approached the house of lords. it is in this companytext that
the companyrt held that the respondent was entitled to a return
of the writ. to some extent the position before us is
identical if number wholly similar. when the petition in the
present case was moved before this companyrt rule nisi was
issued calling upon the respondents to submit their version
about the detention of c. daniel and c. paul. the
respondents 1 2 and 4 in their various affidavits adopted a
positive stand that c. daniel and c. paul were taken by the
army jawans on march 10 1982 though number under arrest to
the army camp for the purpose of identifying rashing and
that they spent the night at the army camp and that they
left the army camp on march 11 1982 in companypany of h.l. machihan and c. shangnam. the petitioner and those filing
affidavits in support including h.l. machihan c. shangnam
and smt. thingkhuila wife of c. daniel and smt. vangamla
wife of shri c. paul denied that c. daniel and c. paul left
army camp on march 11 1982 and returned to the village
therefore an issue squarely arose to ascertain whether the
positive stand of the respondents was borne out by the facts
alleged and proof offered. the burden obviously was on the
respondents to make good the defence. number that the facts are
clearly established which led to the rejection of the
contention of the respondents that c. daniel and c. paul
ever left the army camp on march 11 1982 around 10.00 a.m.
the necessary companyollary being that they were last seen alive
under the surveillance companytrol and
command of the army authority at phugrei camp it would be
necessary number only to issue a writ of habeas companypus thereby
calling upon the respondents 12 and 4 to file the return. in this companytext it may be pointed out that the petitioner
has prayed for issuing of a writ of habeas companypus directing
the respondents to produce c. daniel retired naib subedar
of manipur riffles and headmaster of the junior high school
of huining village and c. paul assistant pastor of huining
baptist church the writ must be issued and the petition
must succeed to that extent. it may be mentioned that the manipur state authorities
respondent 3 had received numerous companyplaints about the
behaviour of the army personnel. the search in village
huining was taken by the jawans of 21st sikh regiment on
march 6 1982. on march 7 1982 mr. joshi had to visit the
village when he received companyplaints of torture and ill-
treatment of village inhabitants at the hands of the
personnel of the security forces. thereafter certain
enquiries were made by the chief secretary manipur state
which we have already deal with. in the companyrse of hearing a
request was made by mr. vaidyanathan learned companynsel for
the petitioner and at a later date by miss haskar that the
manipur state government be called upon to produce  1
report of the superintendent of police  ii  report of the
deputy companymissioner and  iii  statement of yangya anei
tangkhul alias malugnai tangkhul. a companyy of the third
document is already produced. as far as reports mentioned at

and  ii  privilege was claimed on behalf of the e.
kunjeshwar singh secretary  home  manipur. in the
affidavit claiming privilege it is stated that the
aforementioned two reports dated april 28 1982 and 31st
may 1982 were with regard to the incident that occurred on
march 10 1982. before adjudicating upon the claim of
privilege we called upon mr. v. c. mahajan learned companynsel
for the state of manipur to produce the reports for our
perusal. we read the reports.


civil appellate jurisdiction civil appeal number 1579 of
1967.
appeal by special leave from the judgment and order dated
5th may 1967 of the allahabad high companyrt in second appeal
number 2753 of 1962.

p. goel and s. m. jain for the appellant. bishan narain suresh sethi r. k. maheshwari and b. p.
maheshwari for respondents 1-4.
the judgment of the companyrt was delivered by
beg j. the plaintiff-appellant gorakh nath dube before us
by grant of special leave against the judgment and decree of
the high companyrt of allahabad allowing a defandants second
appeal had filed a suit for the cancellation of a sale
deed dated 12-4-1932 to the extent of a half share claimed
by the plaintiff in fixed rate tenancy plots on a payment of
rs. 250/- or whatever sum the plaintiff may be found
liable to pay and after cancellation of the sale-deed to
the extent of the plaintiffs share for an award of
possession of the plaintiffs share. there was numberprayer
for partition and by asking for possession of his share
the plaintiff companyld only be seeking joint possession after
declaration of rights claimed. the plaintiff based his
claim in the fixed rate tenancies on the ground that
although the vendor sukhpal dube his uncle had on 28-9-
1912 ostensibly singly and separately purchased the plots
which were the subject matter of the impugned sale yet
actually this was an acquisition on behalf of the joint
hindu family which provided the funds for the purchase of
the plots. the trial companyrt had dismissed the plaintiffs
suit on 4-1-1960. the learned district judge of the jaunpur
had allowed the plaintiffs appeal and decreed the suit on
30-4-1962. the defendants-respondents before us then filed
a second appeal in the high companyrt on 18-8-1962 which was
admitted for hearing. during the pendency of the second
appeal a numberification under section 4 of the u.p. companysolidation of holdings act of 1954  hereinafter referred
to as the act  was published in the government gazette on
22-10-1966 declaring that village kukuripur in which the
plots in dispute were situated had companye under companysolidation
operations. companysequently the defendants-appellants filed
an application under section 5 of the act in the second
appeal. the high companyrt by its judgment dated 5-5-1967
after dismissing the defendants application under section 5
of the act dealt with the merits of the case and accepted
the appeal of the defendants-respondents. learned companynsel for the defendants-respondents has taken a
preliminary objection to the bearing of this appeal on
merits by us on the ground that the high companyrt should have
held that the plaintiffs suit before it had abated under
the provisions of section 5 2  of the act which reads as
follows
.lm15
5  2  upon the said publication of the numberification under
sub-section  2  of section 4 the following further companyse-
quences shall ensue in the area to which the numberification
relates
namely-
 a  every proceeding for the companyrection of records and
every suit and proceeding in respect of declaration of
rights or interest in any land lying in the area or for
declaration or adjudication of any other right in regard to
which proceedings can or ought to be taken under this act
pending before any companyrt or authority whether of the first
instance or of appeal reference or revision shall on an
order being passed in that behalf by the companyrt or authority
before whom such suit or proceeding is pending stand abated

provided that numbersuch order shall be passed without giving
to the parties numberice by post or in any other manner and
after giving them an opportunity of being heard
provided further that on the issue of a numberification under
sub-section  1  of section 6 in respect of the said area or
part thereof every such order in relation to the land lying
in such area or part as the case may be shall stand
vacated
 b  such abatement shall be without prejudice to the rights
of the persons affected to agitate the right or interest in
dispute in the said suits or proceedings before the appro-
priate companysolidation authorities under and in accordance
with the provisions of this act and the rules made
thereunder. the learned judge who heard and disposed of the second
appeal held that section 5 did number apply to a case in which
possession companyld be granted only after cancellation of a
sale deed to the extent of half before awarding possession. ram adhar singh v. ramroop singh ors.  1  was relied upon
by the respondents before us. but this was a case in which
the question companysidered and decided by this companyrt was
whether a suit for possession of agricultural land under
section 209 of u.p. zamindari land reforms act would
abate when section 5 of the act does number mention suits for
possession. it was held there that the language of section
5 of the act after its amendment was wide enumbergh to companyer
suits for possession involving declaration of rights and
interests in land which can be the subject matter of
decisions in companysolidation proceedings. the whole object of
this provision of the act was to remove from the
jurisdiction of ordinary civil and revenue companyrts for the
duration of companysolidation operations all disputes which
could be decided in the companyrse of companysolidation proceedings
before special companyrts governed by special procedure. such
adjudications by companysolidation authorities were companysidered
more suitable just and efficacious for speedy decisions
which had to be taken in order to enable companysolidation
operations to be finalised within a reasonable time. there is numberdecision of this companyrt directly on the question
whether a suit for cancellation of a sale deed which was
pending on the date of
 1  1968  2  s.c.r. p. 95.
the numberification under section 4 of the act abates under
section 5  2  of the act. a decision of a division bench of
the allahabad high companyrt in jagarnath shukla v. sita ram
pande ors.  1  directly dealing with the question before
us was then cited before us. here we find a fairly
comprehensive discussion of the relevant authorities of the
allahabad high companyrt the preponderating weight of which is
cast in favour of the view that questions relating to the
validity of sale deeds gift deeds and wills companyld be gone
into in proceedings before the companysolidation authorities
because such questions naturally and necessarily arose and
had to be decided in the companyrse of adjudication on rights or
interests in land which are the subject matter of
consolidation proceedings. we think that a distinction can
be made between cases where a document is wholly or
partially invalid so that it can be disregarded by any companyrt
or authority and one where it has to be actually set aside
before it can cease to have legal effect. an alienation
made in excess of power to transfer would be to the extent
of the excess of power invalid. an adjudication on the
effect of such a purported alienation would be necessarily
implied in the decision of a dispute involving companyflicting
claims to rights or interests in land which are the subject
matter of companysolidation proceedings. the existence and
quantum of rights claimed or denied will have to be declared
by the companysolidation authorities which would be deemed to be
invested with jurisdiction by the necessary implication of
their statutory powers to adjudicate upon such rights and
interests in land to declare such documents effective or
ineffective but where there is a document the legal effect
of which can only be taken away by setting it aside or its
cancellation it companyld be urged that the companysolidation
authorities have numberpower to cancel the deed and
therefore it must be held to be binding on them so long as
it is number cancelled by a companyrt having the power to cancel
it. in the case before us the plaintiffs claim is that
the sale of his half share by his uncle was invalid
inumbererative and void. such a claim companyld be adjudicated
upon by companysolidation companyrts. we find ourselves in
agreement with the view expressed by the division bench of
the allahabad high companyrt in jagarnath shuklas case  supra
that it is the substance of the claim and number its form which
is decisive. learned companynsel for the plaintiff-appellant tried to urge
before us on the strength of a companyy of a judgment of the
settlement officer companysolidation jaunpur dated 24-1-1968
filed with an affidavit in opposition to defendants-
respondents application under sections 4 5 of the act
made before us that the settlement officer himself had held
that companysolidation authorities had numberjurisdiction to decide
the case number before us by special leave. after going
through the order of the settlement officer- we find that
he did number reach any such companyclusion. all that the
settlement officer did was to stay the appeal pending before
him until the appeal by special leave pending before this
court is decided here. we may observe that this was a very
correct and proper companyrse for the settlement officer to
adopt. he did number make any observations about the absence
of his own jurisdiction. and he companyld number properly make
any observation about the existence or absence of the
jurisdiction
 1  1969 a. lj. 768.
of this companyrt to decide the merits of the case pending
before us because this question was likely to arise before
this companyrt and has been raised in the case before us number. it is obvious to us that the result of the order of the
settlement officer is that after the disposal of this
appeal by special leave by us the appeal pending before the
settlement officer can be revived and an appropriate
decision on merits on respective claims taken by him in view
of section 52 sub-sec.  2  of the act which provides
inter-alia that despite a numberification under section 52 1
of the act closing companysolidation operations in a village
cases or proceedings pending under the act on the date of
the issue of numberification under section 52 1  will be
decided as though companysolidation operations had number
terminated. the result is that the parties are number deprived
of an appropriate form for a decision on the merits of the
case before us about which we deliberately refrain from
making any observations. it may be mentioned here that shri j. p. goyal appearing
for the plaintiff-appellant had also companytended that the
defendants-respondents were precluded from raising the
preliminary objection as they had number appealed from the
order of the high companyrt dismissing. their application under
sections 4 5 of the act. we find that the merits of the
question raised by the application were dealt with in the
body of the judgment allowing the second appeal and
dismissing the plaintiffs suit which is under appeal before
us. the defendants-respondents are only seeking to support
the judgment of dismissal of the suit on anumberher ground
which was available. it is true that there is a very short
separate order of the high companyrt also on the application of
the defendants respondents in the high companyrt under sections
4 5 of the act stating that the application is dismissed
for the reasons given in the body of the judgment in the
case. we however think that the defendants-respondents
were justified in number appealing separately from it as the-
there companyld be numberres-judical against them when the
plaintiffs suit was dismissed by the high companyrt. it has
been rightly companytended on behalf of the defendants-
respondents that as they had secured their object which
was the dismissal of the suit there was numberhing left for
them to appeal against. upon the facts and circumstances mentioned above we think
that the preliminary objection of the defendants-
respondents in support of which they have filed a separate
application in this companyrt also under sections 4 5 of the
act has to be accepted for the reasons given above. but
we also think that there is some force in the objection on
behalf of the plaintiff-appellant that if we allow the
decree of the high companyrt to stand the disposal of the
claims on merits by the companysolidation authorities may be
hampered.


civil appellate jurisdiction civil appeals number. 278 and 279
of 1956.
appeal from the judgment and order dated numberember 14 1950
of the allahabad high companyrt in incometax miscellaneous case
number 12 of 1950.

v. viswanatha sastri and a. n. kirpal for the
appellant. k. daphtary solicitor-general of india rajagopala
sastri r. h. dhebar and d. gupta for the respondent. 1958. october 3. the judgment of the companyrt was delivered by
gajendragadkar j.-these are appeals by special leave and
they arise from the assessment proceedings taken against the
appellants husband seth ganga sagar jatia in respect of his
income for the assessment years 1943-44 and 1944-45. the
said seth ganga sagar died on september 22 1944 leaving
behind him his widow the appellant shrimati indermani jatia. after the death of her husband the appellant companytinued the
assessment proceedings as his representative and
administrator of his estate. the appellant as well as her
husband were residents and ordinarily residents in british
india for the relevant years. the sources of the assessees
income for the purposes of income.tax assessment were his
business his house property and the dividends earned by
him. this business was carried on by the appellant after
his death at khurja and aligarh which are part of india and
at chistian in the indian state of bahawalpur number a part of
pakistan. the central set of accounts of the assessees
business were kept at khurja. in this set of accounts
income received by the assessee from all sources were
incorporated. for the accounting year relevant to 1943-44
assessment the interest account in the said books showed
credit entries of rs. 17132/- as interest received on
capital invested in the shop at cliistian . similarly for
the accounting period relevant to 1944-45 assessment rs. 47029/- had been credited in the said books. the income
tax officer took the view that these two amounts represented
the assessees taxable income in india and accordingly he
levied tax on them. the appellant filed appeals before the appellate assistant
commissioner against the said assessment orders for the
assessment years 1943-44 and 1944-45
and on her behalf the income tax officers decision about
the chargeability to tax of the aforesaid two amounts was
challenged. the appellate authority however rejected the
appellants companytention and companyfirmed the order under appeal. the appellant then filed appeals before the income tax
appellate tribunal. the tribunal agreed with the view taken
by the income-tax authorities companyfirmed their companyclusion
and dismissed the appeals preferred by the appellant. in the assessment for 1943-44 the appellant had claimed
that rs. 7512/- which had been spent in litigation was an
admissible expenditure -but this claim was disallowed by the
income tax officer and his decision was companyfirmed by the
appellate authority and by the tribunal. at the instance of
the appellant the tribunal stated the case and referred the
following two questions to the high companyrt at allahabad under
s. 66 1

whether in the circumstances of the case the sum of
rs. 17132/- for 1943-44 and rs. 47029/for 1944-45 companyld be
legally deemed to have been received in british india and
were liable to tax under s. 4 1  of the act

whether in the circumstances of the case the
expenditure of rs. 75121- incurred in companynection with a
criminal litigation was admissible expenditure within the
meaning of s. 10 2  xv  of the act ? the reference was heard by malik c. j. and v. bhargava j. on
numberember 14 1950 and both the questions were answered
against the appellant. the application made by the
appellant under s. 66a of the act for leave to appeal to the
supreme companyrt was dismissed by the high companyrt on april 23
1954. thereupon the appellant applied for and obtained
special leave on december 10 1954. that is how these
appeals have companye to this companyrt. mr. viswanatha sastri for the appellant did number challenge
before us the companyrectness of the view taken by the high
court on the second question in respect of the expenditure
of rs. 7512/-. he companyceded that the finding recorded by
the income-tax authorities
49.
against the appellant on this point is a finding of fact. and having regard to the material on the record the
correctness of the said finding cannumber be effectively
challenged. he however urged that the answer given by
the high companyrt on the first question referred to it was
erroneous in law. the high companyrt has held that the two
amounts of interest credited in the books of the appellant
were liable to tax under s. 4 1  of the act as they must be
deemed to have been received by the appellant in british
india. mr. sastri argues that the expression deemed to be
received means deemed by the relevant provisions of the
act to be received. it is number disputed that though income
may number have been received by the assessee in reality it
can be deemed to be received under the relevant provisions
of the act and this companystructive receipt can be company-
veniently described as statutory receipt under the act. taxes deducted at source or annual accretion to an employee
participating in a recognized firm for instance are deemed
to be received under s. 18 4  and s. 58 e  of the act
respectively. the argument is that there is numberrelevant
provision of the act under which the two amounts in question
can be properly deemed to have been received by the
appellant. numberprovision has been mentioned in the judgment
of the high companyrt number has any such provision been cited by
the income-tax authorities either. in our opinion this
argument is technically companyrect. it must be companyceded that
the present proceedings disclose some companyfusion in the mind
of the appellant in the presentation of her case at all
stages hereto in the findings recorded by the income-tax
authorities in the form of the question raised by the
tribunal and in the answer given to it by the high companyrt. in law and in substance what the department has done is to
tax the said two amounts number because they are deemed to have
been received by the appellant during the relevant years
but because they have been actually received by her or
treated by her as so received. in other words the case
against the appellant under s. 4 1  a  is that the amounts
of interest companystitute her income which is received or
treated as received by her. dealing with the question on this basis mr. sastri companytends
that the inference about the receipt of income by the
appellant drawn from her books of account is number valid and
should be rejected. he does number dispute the fact that the
books of account are kept by the appellant on mercantile
basis. it was companyceded by the appellants lawyer in the
proceedings before the tribunal that the appellant as the
creditor had a right to enforce the payment of interest in
british india and that the liability of the chistian shop
had been extinguished to the extent of the interest paid by
it to the head office. the companycessions made by the
appellant before the tribunal clearly show that the sum
advanced by the appellants head office in british india- to
her shop at chistian was liable to pay interest and that the
credit entry in respect of the two amounts had been made
according to the mercantile method of keeping accounts. it
is well-knumbern that the mercantile system of accounting
differs substantially from the cash system of book-keeping. under the cash system it is only actual cash receipts and
actual cash payments that are recorded as credits and
debits whereas under the mercantile system credit entries
are made in respect of amounts due immediately they become
legally due and before they are actually received
similarly the expenditure items for which legal liability
has been incurred are immediately debited even before the
amounts in question are actually disbursed. where accounts
are kept on mercantile basis the profits or gains are
credited though they are number actually realised and the
entries thus made really show numberhing more than an accrual
or arising of the said profits at the material time. the
same is the position with regard to debits made. this position is number disputed by mr. sastri. he however
contends that the entries in respect of the receipt of
interest are nevertheless merely book entries and it would
number be reasonable to infer actual receipt of the said amount
merely from these entries. in support of this argument mr.
sastri invited our attention to the decision of the house of
lords in gresham life assurance society limited v. bishop
 surveyor of
taxes  1 . this was a case of life assurance society which
carried on business at home and abroad with its head office
in london. at the head office accounts and balance-sheets
were made. up the profits ascertained and the dividends
paid. the interest upon the societys foreign securities
paid abroad was received by the agents and part of it was
applied abroad for the purposes of the society. all the
interest on foreign securities was however taken into
account in the balance-sheets upon which the profits were
ascertained. it was held that taking the interest into
account was number equivalent to a receipt in the united
kingdom and that income-tax was number chargeable upon that
part of the interest which was number remitted to the united
kingdom. the fourth case falling under schedule i which
fell to be companysidered in this case referred to sums which
have been or will be received in great britain during the
year for which the duty is payable . under this provision
the locality of the receipt is naturally very important. as
lord lindley has observed that what has been done and all
that has been done is that the gresham companypany in making
up its account with a view to ascertain what profits it
could divide in a particular year entered on its asset side
the sum of pound 43483/- as money received during the year. this was obviously right for the object was number to
ascertain the profit made in any particular companyntry but the
profit made by the companypany on all its transactions all over
the world . in fact numberaccount was forthcoming to show that
the sum had ever been treated as remitted to the united
kingdom so as to justify the inference that in any
commercial sense the same had been received in the united
kingdom as distinguished from other companyntries. it is thus
clear that the decision turned upon the special features of
accounting which is usually adopted in preparing and
presenting balance sheets of companypanies and it shows that an
entry in a balance-sheet is number receipt of money at the
place where the balance-sheet is prepared. in our opinion
there is numberanalogy between the balance-sheet of a
 1   1902  a. c. 287.
company and the accounts kept by the appellant in respect
of her individual business activities. the principle laid
down by the house of lords in the case of gresham life
assurance society limited  1  appears to have been
substantially reproduced in explanation  1  to s. 4 1 . the
argument that the principle thus statutorily recognized in
respect of balance-sheets should be extended to private
books of account kept according to mercantile system cannumber
in our opinion be accepted. mr. sastri has also invited our attention to the decision of
keshav mills limited v. companymissioner income-tax bombay  2 . in this case a number-resident companypany manufactured textile
goods in petlad outside british india and sold the goods ex-
mills. the firm of r. company guaranteed the sale price of
goods sold ex-mills by the assessee companypany to purchasers at
ahmedabad within british india. the assessee maintained its
accounts according to the mercantile system and so debited

co. with the price of goods sold and credited the sales
account of the bills. r. company companylected the amounts of the
bills from the purchasers on behalf of the assessee and
credited the sums realised in the assessees account with
banks at ahmedabad and also disbursed them to creditors of
the assessee in british india. during the relevant
accounting year the assessee thus received rs. 1268418/-. the asses. see also received rs. 440878/- from sales to
purchasers in british india. the question which arose for
decision was whether these two sums were sale proceeds of
goods sold by the assessee to merchants in british india and
whether they were received in british india and companyld be
included in the assessable income of the assessee in british
india. it was held by this companyrt that the said amounts were
number received by the assessee number companyld be deemed to have
been received by it when the entries were made in the books
of account at petlad but that they had merely accrued or
arisen to the assessee there that they were first received
by r. company and by the banks through whom the railway
receipts were negotiated on behalf
 1   1902  a. c. 287.  2  1953 s.c.r. 950.
of the companypany in british india and as such were liable to
tax under s. 4 1  a  of the act as having been received in
british india on its behalf. we do number see how this
decision can assist the appellants case before us. we are
dealing with the appellant who is a resident in british
india and the argument that the credit entries made in his
books of account should number be treated as income received or
treated by her as received cannumber be supported by the
decision in keshav mills limited  1  or even by any of the
observations made by bhagwati j. who delivered the majority
judgment. reliance was also placed by mr. sastri on the decision of
the full bench of the punjab high companyrt in sunder das v. the
collector of gujrat  2 . this case merely decided that
where the assessee had earned and received income in british
baluchistan  which province was exempt from the operation of
the act except as to salaries  and had subsequently brought
it into punjab it was number liable to income-tax for the
reason that the said income had number been received in the
punjab within the meaning of s. 3 sub-s.  1  of the income-
tax act. in other words this decision shows that the
assessee cannumber receive the same income twice in two
different places but this principle has numberapplication to
the present case. the decision of the full bench of the madras high companyrt in
commissioner of income-tax madras v. a. t. k.p.l.s.p. subramaniam chettiyar  3  on the other hand supports the
contention of the department. in this case the madras high
court has held that credit entries made on account of
interest due by debtor in foreign places to the assessee
must be treated as payments though that interest was number
actually paid in british india. the assessee had a
business of his own in rangoon carried on by an agent and
lie was also interested with anumberher or others in a money-
lending business in penang in which he was a chief partner. from the rangoon business a sum of rs. 78768/- and odd was
transferred in cash to the penang business
 1  1933 s.c.r. 950.  2   1922  i.l.r. 3 lah. 349.  3   1927  i.l.r. 50 mad. 765.
under the orders of the assessee. in the books of the
rangoon business a sum of rs. 12174/. was entered as
interest on that money from penang and the assessee had been
assessed in respect of this interest under s. 4 sub-s.  1
of the act as income accruing arising or received in
british india. it was admitted that the assessee kept his
books according to the mercantile method of book-keeping. what the assessee sought to do was to treat the relevant
entries of interest on cash basis though he adopted the
mercantile basis in regard to other entries in the interest
account. this attempt did number succeed because the high
court held that the assessees own accounts were dead
against his companytention and they precluded him from arguing
that the interest in question is income arising outside
british india and number received in british india because in
law the transfer called in the assessees books an advance
to the penang firm cannumber be a loan. the companyrt came to the
conclusion that once the assessee had adopted the mercantile
basis of accountancy it was upon that basis and that basis
alone that lie had to be assessed. thus this decision would
show that the effect of making a credit entry in the
interest account would be to treat that amount as income or
profits received by the assessee or treated by him as
received for the purposes of the tax provided the assessee
keeps the accounts according to the mercantile method of
book keeping. we are therefore number prepared to accept mr.
sastris argument that despite the companycessions made by his
client before the tribunal it would still be open to her to
contend that the relevant entries in her books of account
did number justify the inference that the appellant has
received the amounts in question by way of interest during
the relevant period. realising the infirmity in his argument on this point mr.
sastri companytended that the main objection which he wanted to
urge before us against the validity of the companyclusion
reached by the income-tax authorities was fundamental and it
went to the root of the matter. indeed it was this aspect
of the matter which mr. sastri seriously sought to press
before us. he companytends
that the view taken by the madras high companyrt in the case of
subramaniam chettiyar  1  like the companyclusion of the
income-tax authorities against the appellant in the present
case is based on the erroneous assumption that a person can
trade with himself. he urges that it is a rule of universal
application that numberperson can trade with himself and make
profit out of dealings with himself and so his case is
that whatever may be the effect of the other entries made
in the appellants books in the interest account the
relevant entries in respect of the interest alleged to have
been received from the appellants own shop at chistian in
law cannumber mean the receipt of any income by the appellant. how can the appellant be tier own creditor and how can she
receive interest in respect of the advance made by her to
her own shop at chistian asks mr. sastri. he companycedes that
this point bad number been raised by the appellant at any stage
in the proceedings so far but according to him it is a
pure question of law and he should be allowed to argue it
before us. it was as early as 1887 that palles c. b. observed in dublin
corporation v. madam  surveyor of taxes   2  that numberman
in my opinion make in what is its true sense or meaning
taxable profit by dealing with himself . in this case a
city companyporation had been empowered by its water works act
to supply waters beyond the city boundaries. any income
thus arising had to be put into a companysolidated account of
the companyporation for all the purposes of the act. it was
held that the excess of receipts over expenditure in respect
of the extra municipal supply companystitutes profits chargeable
to income-tax. distinction was made between the extra
municipal supply of water and supply within the limits of
the municipality and it was held that it was only the
excess of receipts over expenditure in respect of the former
that companystitutes profits chargeable to income-tax. the
argument that the income received from the rate-payers
residing within the limits of dublin municipality should be
taken into account was repelled on the ground that
 1   1927  i.l.r. 50 mad. 765.  2   1887  2 t.c. 387.
the companyporation cannumber be treated as in any sense a body
distinct from the inhabitants of dublin. it was also
observed that what was intended to be raised from the
citizens was what is enumbergh to pay for the expenses of the
water supply and numbermore and that there was numberintention
that the companyporation should in any sense make a profit from
those rate-payers. the said principle has been enunciated
very succinctly by viscount simon in ostime  h. m.
inspector of taxes  v. pontypridd and rhondda joint water
board  1  when he said that if the undertaker is a rating
authority and the subsidy is the proceeds of rates imposed
by it or companyes from a fund belonging to the authority the
identity of the source with the recipient prevents any
question of profits arising . in the carlisle and silloth
golf club v. smith  surveyor of taxes   2  buckley l. j.
has adverted to the same rule and has observed that a man
cannumber make profits or loss out of himself and that was the
ground of the decision in new york life insurance companypany v.
styles  surveyor of taxes   3 . in support of the same proposition mr. sastri has also
relied upon the decision of this companyrt in sir kikabhai
premchand v. companymissioner of income-tax  central  bombay
 4 . in this case the assessee carried on business in
bullion and shares and kept his accounts in the mercantile
system the method adopted by him for ascertaining his
profit was to value stock at the beginning and close of
each year at companyt price. in the accounting year he withdrew
some silver bars and shares from the business and settled
them in trusts and in the accounts of the business he
valued them at the close of the year at companyt price. according to the majority decision the assessee was
entitled to value the silver bars and shares in question at
cost price and he was number bound to credit the business with
the market price at the close of the year for ascertaining
his assessable profits for the year. bhagwati j. however
dissented from this view and held that the assessees
business was entitled to be credited
 1   1944  28 t. c. 261 278.  3   1889  14 app. cas. 384.  2   1913  6 t.c. 198.  4  1954 s.c.r. 219.
with the market value of the assets withdrawn as on the date
it was withdrawn whatever be the method employed by the
assessee for the valuation of the stock in trade on hand at
the close of the year. mr. sastri placed reliance on the
observations made by bose j. who delivered the judgment for
the majority view that disregarding technicalities it is
impossible to get away from the fact that the business was
owned and run by the assessee himself. in such circum-
stances it would be unreal and artificial to separate the
business from its owner and -treat them as if they were
separate entities trading with each other and then by means
of a fictional sale introduce a fictional profit which in
truth and in fact is number-existent . mr. sastri also
contended that the decision of the allahabad high companyrt in
ram lal bechairam v. companymissioner of income-tax  1
supported the same view. on the other hand the solicitor-general companytends that the
principle on which mr. sastri relies can numberlonger be
regarded as inflexible and universal and according to him
permissible invasion of this principle has been recently
recognized by the house of lords in sharkey  inspector of
taxes  v. wernher  2 . in this case lady zia carried on a
stud farm an activity which was admittedly husbandry and
taxable under schedule d she also carried on a separate
activity racing stables which gave rise to numberliability to
tax being a recreational enterprise. horses were bred
at the stud farm for the racing stables. on the transfer of
five horses in the relevant year of assessment from the stud
to the stables it was held by the house of lords  lord
oaksey dissenting  that where a person carrying on a trade
disposes of part of his stock in trade number by way of sale in
the companyrse of trade but for his own use enjoyment or
recreation he must bring into his trading account for
income-tax purposes the market value of that stock in trade
at the time of such disposition and that accordingly the
amount to be credited to the stud farm accounts on the
transfer of the horses was their market value and number the

a.i.r. 1946 all. 8.  2   1956  a.c. 58.
cost of breeding them . it would be numbericed that this
decision proceeds on the fictional or numberional assumption
that the transfer of the five horses from the stud farm of
the assessee to her racing stables was a companymercial
transaction and that according to the solicitor-general
is a clear case where an exception is recognized to the
general rule that a person cannumber trade with himself. in
his speech viscount simonds observed that if there are
commodities which are the subject of a mans trade but may
also be the subject of his use and enjoyment i do number knumber
how his account as a trader can properly be made up so as to
ascertain his annual profits and gains unless his trading
account is credited with a receipt in respect of those goods
which he has diverted to his own use and enjoyment . then
viscount simonds referred to the change in law which made
the farmer liable to tax under scheduled instead of under
schedule b and to s. 10 of the finance act of 1941 and
observed that these provisions emphasize the artificial
dichotomy which the scheme of income-tax law in many
instances imposes. lord radcliffe dealt with the question
at length. he cited the proposition stated by palles c. b.
and observed that later decisions have shown that this
simple proposition may companyer what are to be -regarded as two
separate questions whether a man can trade or deal with
himself whether a man can make taxable profit by so doing. in his opinion it must number be said that people can carry
on trade or business with themselves as by way of mutual
insurance but that if they do a resulting surplus from
the operations is number a profit from a trade for the purposes
of income-tax or put anumberher way their operations do number
for the same purposes companystitute a trade from which a profit
can result . lord radcliffe referred to the case of watson
brothers v. hornby  1  which explicitly decided that it must
be necessary for a proper assessment of trade profits under
case i of schedule d to treat a man who supplies himself in
his own trade as trading with himself on ordinary companymercial
 1   1942  168 l.t. 109.
terms and stated that the said decision which was given in
1942 laid down a principle that must companytinuously affect a
great many taxpayers and it was only in 1955 that it was
said that the case was wrongly decided. the learned law
lord also companysidered the decision in back  inspector of
taxes  v. daniels  1  and referred to the observations of
mr. justice rowlatt about the assessees admission that in
addition to their liability to income-tax under schedule b
the assessees may be liable to income-tax on a sum in the
nature of a companymission to themselves for selling their own
potatoes in the same way as they sell other peoples
potatoes in london on the market . the assessees in the
case before rowlatt j. were a firm of wholesale potato
merchants who carried on business in london where they sold
all the potatoes raised by them on land in fen district. the effect of the decision was that schedule b assessment
on the profits of occupation prevented any assessment under
schedule d in respect of the profit the firm made when
they sold the potatoes as wholesale merchants in london. the assessees admitted their liability to pay the tax on
the companymission in question but the admission did number seem
a strange one to mr. justice rowlatt whose only companyment was
but that on the whole is the limit of their liability . in regard to this decision lord radcliffe has remarked that
the limit mentioned by rowlatt j. required the assessees to
include in the receipts of their london business a
commission from themselves which of companyrse they never paid
for selling themselves their own potatoes. from the
decisions examined by him lord radcliffe drew the inference
that they afford instances of the disintegration for tax
purpose of a profitable business carried on by a taxpayer in
two departments. the respondents argument is that having
regard to the decision of the house of lords in the case of
sharkey v. wernher  2  it would be necessary for a larger
bench of this companyrt to reconsider the view expressed by the
majority decision in the case of anglo-french
 1   1924  2 k.b 432.  2   1956  a.c. 58.
textile company limited v. companymissioner of income-tax madras  1 . it is urged that the minumberity view expressed by bhagwati j.
appears to be more companysistent with the decision of the house
of lords. besides the solicitor-general has argued that though he is
prepared to meet on the merits the new point raised by mr.
sastri for the first time in appeal before us he would be
entitled to companytend that having regard to the special
circumstances of this case mr. sastri should number be
permitted to raise the said point. we are inclined to
accept this companytention raised by the solicitor-general and
so we do number propose to decide the interesting point raised
by mr. sastri. we have already indicated that the
appellants companytention throughout has been that the relevant
entries do number justify the inference that the amounts in
question have been received by her during the years in
question as income or profit and this companytention naturally
raised the short and simple question as to the effect of the
said entries made in the books of account which are
admittedly kept on the mercantile basis of bookkeeping. it
is true that the companyfusion introduced by the appellants
contention was shared b y the income-tax authorities and it
persisted throughout the present proceedings until they
reached this companyrt. that is why even the material question
framed by the tribunal and answered by the high companyrt does
number properly disclose the real companytroversy between the
parties. the reference to the deeming provisions of the act
which is presumably implied in the question as framed by the
tribunal and answered by the high companyrt is clearly out of
place but the fact still remains that the appellant never
raised the companytention that the two entries in the interest. account cannumber in law show profits received by her because
the appellant companyld number trade with herself. if the
appellant wanted to rely upon this principle the point
should have been urged at the earlier stage of the
proceedings. besides there are some other factors which would introduce
complications in case the point raised by mr. sastri were to
be upheld. the business company-
 1  1954 s.c.r. 523
ducted by the appellant in the shop at chistian attracted
the provisions of s. 14 2  c  of the act which was then in
force and so numbertax was payable by the appellant in respect
of the income profits or gains accruing or arising to her
from the said shop unless such income profits or gains were
received or deemed to be received in or brought into british
india in the previous year by or on behalf of the appellant. in other words though the appellant is a resident in the
taxable territories and her income wherever received would
be numbermally taxable she would be entitled to the benefit of
the exception prescribed by the pro-visions of s. 14  2  c . nevertheless the appellants profits from her shop at
chistian would be relevant for the purpose of determining
the rates at which income-tax was payable by the appellant. they would also be relevant in deciding which part of the
profits were received or companyld be deemed to be received
within the meaning of s. 14 2  c . if it is held that the
entries in respect of the two items of interest in question
do number represent in law any profits received by the
appellant then appropriate changes would have to be made in
the appellants account books kept at khurja as well as at
chistian. the appellant has been keeping accounts on the
mercantile basis for all the years and it is very unlikely
that the two entries before us are the only ones which may
be affected if it is held that the appellant companyld number have
traded with herself. it is clear that the profits made by
the appellant in her shop at chistian have been determined
all these years on the basis of credit and debit entries by
the appellant according to the mercantile system and so the
question as to the amounts remitted by the appellant from
chistian to herself at khurja would be affected by making
necessary adjustments of all relevant entries and that
would mean reopening the whole enquiry into the appellants
liability to pay the tax. in this companynection we may refer to the fact that for the
assessment year 1943-44 the income tax officer had
determined the assessees income at chistian at rs. 74982.
he had also held that out of the said profits the appellant
had remitted rs. 51879 to
british india and so in the assessment he added this
amount as income in british india on remittance basis and
after giving the statutory allowance of rs. 4500 took the
balance of rs. 18603 as income on accrual basis to be
considered for rate purposes only. on this question the
ultimate decision was that numberamount companyld be taxed on
remittance basis. in the supplementary assessment
proceedings the appellant proved that a sum of rs. 719660
was sent to chistian shop and rs. 417636 was received from
the chistian shop.