civil appellate jurisdiction civil appeal number 2589 of
1979.
from the judgement and order dated 8.8.1977 of the
bombay high companyrt in special civil application number 983 of
1972.

m. tarkunde ms. s. janani and mrs. urmila kapoor for
the appellant. b. bhasme u.r. lalit d.n. misra r.a. gupta and ms.
shefali khanna for the respondents. the judgement of the companyrt was delivered by
thommen. j. this appeal arises from the judgement of
the bombay high companyrt in special civil application number 983
of 1972 setting
aside the order made by the appellate officer  the
principal judge of the city civil companyrt bombay  under
section 105f of the bombay municipal companyporation act 1888
 the act whereby he allowed the appellants appeal against
the order of eviction made against it under section 105b of
the act by the enquiry officer acting in terms of section
68 of the act as a delegate of the companymissioner of the
municipal companyporation of greater bombay the first
respondent  the companyporation . by the impugned judgement the high companyrt has companyfirmed
the order of eviction made against the appellant the
principal occupant of two godowns belonging to the
corporation. the original occupant of the godowns glenfield
co. had on 1.10.1963 granted to the appellant a licence
in respect of these premises and subsequently by a deed of
assignment dated 13.8.1966 assigned all its rights title
and interest in the premises in favour of the appellant. the
appellant thereafter requested the companyporation on the ground
that ghatge patil  transport  pvt. limited the second
respondent had been already in occupation of the premises
and after satisfying itself as to those terms the
corporation transferred the occupancy right from glenfield
co. to the appellant on the appellant executing a formal
agreement dated 17.6.1967. the companyporation was thus fully
aware of the terms and companyditions of occupation of the
premises by the second respondent and with the full
knumberledge of those terms the appellant was recorded in the
corporations book as the principal occupant in the place of
glenfield company the second respondent was thus understood
and accepted by the companyporation to be in occupation of the
premises under the appellant. all this was in 1967.
a numberice dated 25.7.1969 terminating tenancy
purporatedly in terms of the agreement dated 17.6.1967 was
served on the appellant. this was followed by an enquiry
under the act which companymenced in 1970 and resulted in the
order of eviction dated 6.1.1971. the order of eviction
refers to the appellant as the principal tenant and the
second respondent as a sub-tenant. the enquiry officer
acting as a delegate in terms of section 68 and exercising
the power of companymissioner
under section 105b ordered eviction of the appellant on
the ground of sub-letting the premises. she held that the
appellant had sub-let the premises companytrary to the terms or
conditions of occupation and had thus become an unauthorised
occupant liable be evicted from the premises. the enquiry officer on inspection found that that the
second respondent was in occupation of the premises as sub-
lessee. she numbericed the terms and companyditions of the
agreement dated 27.3.1964 under which the premises had been
allowed to be occupied by the second respondent. she
concluded that the appellant had by reason of sub-letting
contrary to the terms or companyditions of occupation become
liable to be evicted in terms of section 105b. accordingly
she passed an order of eviction against the appellant. this order was on appeal set aside by the appellate
officer. on appreciation of the evidence on record
including the terms of the relevant agreements the
appellate officer held that the agreement dated 27.3.1964
under which the second respondent occupied the premises had
been well-knumbern to the companyporation and the companyporation
having satisfied itself as to the full implication and
significance of that occupation approved and recorded the
assignment and transfer of the right title and interest of
glenfied company to the appellant and recognised the
appellant as the principal occupant. the companyporation was
thus at all material times aware of the appellants
relationship with the second respondent and the occupation
of the premises by the second respondent under the
appellant. accordingly the appellate officer held that in
the absence of any material to show that the relationship
between the appellant and the second respondent had so
altered since the appellants agreement with the companyporation
as to violate the terms or companyditions of occupation the
eviction of the appellant solely on the ground of sub-
letting was unwarranted. the reasoning of the appellate officer thus appears to
be that the companyporation having allowed the transfer of the
occupancy right of glenfield company to the appellant with the
full knumberledge of the terms and companyditions under which the
second respondent was already let into the premises by the
appellant whatever be the nature of their relationship--
whether it be a lease or licence--the companyporation was
estopped from number companytending that the alleged sub-letting
was companytrary to the terms or companyditions of the appellants
occupation of the premises and that the appellant had for
that reason become liable to be evicted. this is what the appellate officer stated on the point
there is numberallegation that after the tenancy
was transferred in the name of the applicantwith
the full knumberledge and companysent of the municipal
corporation as to the terms and companyditions on which
the premises were occupied by the 2nd respondent
there has been any change in the nature of the 2nd
respondents occupation of the part of the premises
and also in the terms and companyditions of the
occupation. although the subsequent agreement was
entered into between the appellants and the 2nd
respondent it was on the same terms and companyditions
as the first agreement which was produced before
the ward officer before the transfer of tenancy in
favour of the appellants  in this case
therefore even if the agreement between the
appellants and the 2nd respondent is interpreted as
a sub-tenancy agreement and under the said
agreement the appellants are said to have sublet
the premises to the 2nd respondent the said
subletting was prior to the transfer to tenancy in
favour of the appellants and was with the full
knumberledge and companysent of the municipal companyporation
and therefore that cannumber be companysidered to be
subletting in breach of the agreement of tenancy so
as to enable the municipal companyporation to evict the
appellants on that ground
this is essentially a finding of fact. the order of the
appellate officer is final and is number ordinarily liable to
be called in question  see section 105g . nevertheless
this finding was set aside by the high companyrt by the impugned
judgment in exercise of its jurisdiction under article 227
of the companystitution. the high companyrt held
even otherwise in our view respondent number1
was liable to be evicted under section 105b 1
clause  a  subclause  ii . we are unable to agree
with the finding given by the learned principal
judge that numberchange in the circumstances under
which the tenancy had been transferred in the name
of respondent number 1 has taken place after the grant
of the lease and therefore the companyporation would
be stopped from alleging that respondent number 1 had
sublet the premises
the high companyrt thus held that the appellate officer was
wrong in
saying that the circumstances had number altered so as to
warrant an order of eviction on the ground or sub-lease. the
high companyrt also held that the lease in favour of the
appellant had been duly determined by the companyporation in
terms of the companytract and the appellant having thus become
an unauthorised occupant was as such liable to be evicted
under clause  b  of sub-section  1  of section 105b. the
high companyrt stated
 if a tenancy is terminated in accordance
with terms of the tenancy agreement it must be
held to be duly terminated. such a person was
liable to be evicted under the provisions of
section 105b 1  of the act. the companyporation has indeed the power to order eviction
on the ground of sub-letting which is companytrary to the terms
or companyditions of occupation. but it cannumber be gainsaid that
when by specific agreement dated 17.6.1967 the companyporation
recognised the assignment of all rights title and interest
made by glenfield company on 13.8.1966 in favour of the
appellant in respect of the premises in question and thus
treated the appellant as the principal occupant the
corporation was fully aware of the terms and companyditions of
the agreement dated 27.3.1964 under which the second
respondent was already in occupation of the premises. nevertheless the companyporation entered into the agreement
dated 17.6.1967 accepting the appellant as the principal
occupant in the place of glenfield company in the absence of
any evidence to show that the relationship between the
appellant and the second respondent has since altered so as
to violate the terms of the agreement of occupation dated
17.6.1967. it is number open to the companyporation to order
eviction of the appellant on the ground of sub-letting which
is alleged to be companytrary to the terms or companyditions of
occupation. the high companyrt in our view wrongly reversed
the finding of fact on that question by the appellate
officer. whether the circumstances had changed or number was a
question then is whether as found by the high companyrtit is
open to the companyporation to have recourse to clause  b  of
sub-section  1  of section 105b to order eviction of the
appellant as an unauthorised occupant. is clause  b
attracted where eviction is sought to be made by
determination of authority otherwise than in terms of the
statute? mr. v.m. tarkunde appearing for the appellant submits
that the appellate officer having found that the
corporation was when it
entered into an agreement of occupation with the appellant
on 17.6.1967 fully aware of the terms and companyditions under
which the second respondent was in occupation of the
premises in question under the appellant the high companyrt was
number justified in upholding the eviction of the appellant on
the very same ground. the application of clause  b  of sub-
section  1  of section 105b companynsel says is companyfined to
persons in unauthorised occupation. persons in occupation of
premises under authority are number liable to be evicted
otherwise than on any one of the statutorily specified
grounds. mr. s.b. bhasme appearing for the companyporation submits
that in view of the finding that the sub-lease granted or
renewed by the appellant was companytrary to clause  6  of its
agreement dated 17.6.1967 which provided. i agree that this godown will number be
assigned or sub-let or allowed to be occupied by
any person and if it or any part of it is assigned
or sub-let to any other party i will be liable to
be ejected immediately. and also in view of clause  2  of the said agreement which
reads
each party may terminate the tenancy at the end
of any english calendar month by giving to the
other party one months numberice in writing. the appellant has after the expiry of the period stipulated
in the numberice dated 25.7.1969 become an unauthorised
occupant and is liable to be evicted in terms of clause  b
of sub-section  1  of section 105b of the act. according to mr. bhasme the agreement under which the
appellant occupied the premises has expired or has been duly
determined by order of the companypetent authority. further
continuance by the appellant is an unauthorised occupation
so as to attract the provisions of section 105b. apart from
the grounds mentioned in sub-clauses  i   ii   iii  and

of clause  a  of sub-section  1  of section 105b the
corporation is also empowered under clause  b  of sub-
section  1  of that section to evict any person whose
authority to occupy has expired or has been duly determined
and who thereafter remains in occupation of the premises. the authority to occupy he says is duly determined even if
the determination is sought to be founded on the ground of
sub-letting companytrary to the terms and
conditions of occupation or on any other ground specified
in clause  a  or clause  c  of sub-section  1  105b and
that ground is subsequently held to be number proved and the
order of eviction on that ground is accordingly found to be
invalid. this invalidity according to companynsel is only as
far as it related to the alleged ground. nevertheless he
says such order determining authority to occupy is
sufficiently efficacious to make further occupation
unauthorised so as to attract clause  b  of sub-section
 1  provided the determination of authority can otherwise
be justified in terms of the agreement of occupation. in
such circumstances he says clause  b  of sub-section  1
is a potent weapon in the hands of the companyporation. we shall number examine the relevant provisions. section
105a to section 105h of chapter va were inserted in the act
in 1961 so as to provide for speedy eviction of persons in
unauthorised occupation of companyporation premises. section
105a  d  defines unauthorised occupation in the following
words
 d  unauthorised occupation in relation to any
corporation premises means the occupation by any
person of companyporation premises without authority
for such occupation and includes the companytinuance
in occupation by any person of the premises after
the authority under which he was allowed to occupy
the premises has expired or has been duly
determined. the definition shows that occupation of companyporation premises
without authority for such occupation is an unauthorised
occupation. such occupation includes companytinuance in
occupation by a person after the authority under which he
occupied the premises has expired or it has been duly
determined. the definition thus includes number only a
trespasser whose initial and companytinued occupation has never
been under any valid authority but it also includes in
equal measure a person whose occupation at its companymencement
was under authority but such authority has since expired
or has been duly determined--which means validly
determined. the expiry of authority to occupy occurs by
reason of the terms or companyditions of occupation. on the
other hand the determination of authority to occupy to be
due or valid must be founded on one of the grounds
specified by the statute. any order of eviction on the
ground of either expiry or due determination has to be
made in accordance with the procedure prescribed by the
statute. section 105b in so far as it is material reads
s. 105b  1  where the companymissioner is satisfied-
 a  that the person authorised to occupy any
corporation premises has whether before or after
the companymencement of the bombay municipal
corporation  amendment  act 1960

number paid for a period of more than two
months the rent or taxes lawfully due from him in
respect of such premises or

sub-let companytrary to the terms or
conditions of his occupation the whole or any part
of such premises or

committed or is companymitting such acts
of waste as are likely to diminish materially the
value or impair substantially the utility of the
premises or

otherwise acted in companytravention of any of the
terms expreses or implied under which he is
authorised to occupy such premises
 b  that any person is in authorised
occupation of any companyporation premises
 c  that any companyporation premises in the
occupation of any person are required by the
corporation in the public interest. the companymissioner may numberwithstanding anything
contained in any law for the time being in force
by numberice  served by post or by affixing a companyy of
it on the outer door or some other companyspicuous part
of such premises or in such other manner as may be
provided for by regulations  order that that
person as well as any other person who may be in
occupation of the whole or any part of the
premises shall vacate them within one month of the
date of the service of the numberice.  2  before an order under sub-section  1  is made
against
any person the companymissioner shall issue in the
manner hereinafter provided numberice in writing
calling upon all persons companycerned to show cause
why an order of eviction should number be made. the numberice shall
 a  specify the grounds on which the order of
eviction is proposed to be made and
 b  require all persons companycerned that is to
say all persons who are or may be in occupation
of or claim interest in the companyporation
premises to show cause against the proposed
order on or before such date as is specified in
the numberice. if any person refuses or fails to companyply with
an order made under sub-section  1  the
commissioner may evict that person and any other
person who obstructs him and take possession of the
premises and may for that purpose use such force
as may be necessary.  emphasis supplied
clause  a  of sub-section  1  of this section companytains
various grounds upon which a person is liable to be evicted. clause  b  says that unauthorised occupation itself is a
ground for eviction. clause  c  provides that requirement in
the public interest is a ground for eviction. sub-section
 2  speaks of show cause numberice before an order of eviction
by numberice is made under sub-section  1 . sub-section  3  has
conferred sufficient power on the companymissioner to enforce an
order of eviction made by him under sub-section  1 . for the
purpose of holding an enquiry under the act the
commissioner is invested with all the powers of a civil
court  section 105e . an appeal lies from every order of the
commissioner under section 105b or section 105c to the
appellate officer namely the principal judge of the city
civil companyrt of bombay  section 105f  whose orders are final
and number liable to be called in question in any original
suit application or execution proceeding  section 105g . the satisfaction of the companymissioner which is the
condition precedent to the exercise of power of eviction by
the summary procedure
prescribed by the act may be in respect of any of the
circumstances falling under clauses  a   b  or  c  of sub-
section  1  of section 105b. clause  a  companytemplates
eviction of any person on any one of the grounds mentioned
in sub-clauses  i  to  iv  thereof. these grounds relate
only to a person in authorised occupation of companyporation
premises. they have numberapplication to a trespasser. this is
clear from the grounds themselves as well as from the
wording of clause  a  which reads that the person
authorised to occupy likewise clause  c  presumably
applied to authorised occupation of companyporation premises
which the companymissioner is empowered to terminate by ordering
eviction of the occupant otherwise than on any of the
grounds specified under clause  a  provided the
commissioner is satisfied that the premises in question are
required by the companyporation in the public interest. all that
the companymissioner has to satisfy himself in a case falling
under clause  c  is as regards the public interest requiring
eviction. companystruction of parks playgrounds hospitals
colleges markets destitute-homes and the like will indeed
qualify for invoking the companymissioners power under clause

clause  b  on the other hand is a powerful weapon for
eviction of an unauthorised occupant. this clause is
applicable equally to a trespasser as it is to a person
whose occupation has ceased to be an authorised occupation
by reason of expiry of authority in terms thereof or due
determination of authority under clause  a  or clause  c  of
sub-section  1  of section 105b. if a person is in occupation without authority as in
the case of a trespasser or if the authority under which a
person has been in occupation has expired in terms thereof
and he companytinues to remain in occupation of the premises he
will be liable to be evicted on the ground mentioned in
clause  b  of sub-section  1  of section 105b but in
accordance with the procedure laid down in that section and
on the satisfaction of the companymissioner expressed by an
order as to the lack or expiry of authority. it must
however be remembered that except in the case of a
trespasser or a person remaining in occupation even after
the expiry of the period of authority clause  b  can be
invoked only where the companymissioner is satisfied and has so
found be an order that any one of the grounds falling under
clause  a  or clause  c  of sub-section  i  for
determination of authority has been established. in the
absence of such a valid order invoking clause  a  or clause
 c  a person in occupation under authority which has number
expired is number liable to be evicted under section 105b. we
do number accept mr. bhasmes argument to the companytrary on this
point. it is number the case of the companyporation that the
authority under
which the appellant has been in occupation has expired in
terms thereof. that was number the basis upon which the enquiry
was companyducted and the order of eviction was made. if that
was the ground and that ground was rightly invoked the
position might well be different. the specific ground upon
which eviction was sought as seen in the order of the
enquiry officer and as categorically found by the high
court was one of sub-letting companytrary to the terms or
conditions of occupation. numberother ground as the high companyrt
says was relied upon by the companyporation. in the
circumstances the companymissioner  or his delegate  must be
understood to have restricted the scope of the enquiry to
the ground falling under clause  a   ii  of sub-section  1
of section 105b for the purpose of invoking the summary
power of eviction vested in him under the statute. sub-letting as such without more is number a ground for
eviction under clause  a   ii . what attracts eviction in
terms of that provision is sub-letting which is companytrary to
the terms or companyditions or occupation. the appellate officer
has found that the occupation of the premises by the second
respondent under the appellant was well-knumbern to the
corporation the terms and companyditions of that
occupation were closely scrutinised by the companyporation
before recognising the transfer of rights and interest from
the previous principal occupant to the appellant and it
was on that basis and with that knumberledge that the
corporation authorised the occupation of the premises by the
appellant in terms of the agreement dated 17.6.1967.
in such circumstances whatever right of occupation
which the second respondent enjoyed under the appellant must
be deemed to have been incorporated as a term of the
authority granted by the companyporation in favour of the
appellant. the appellate officer has categorically found
that there was numberevidence whatsoever to indicate that the
circumstances in which the premises had been occupied by the
second respondent had in any manner or at any time altered
so as to affect the terms or companyditions under which the
appellant was recognised as the principal occupant. the
corporation is accordingly on the facts found stopped from
having recourse to the ground falling under clause  a   ii
of sub-section  1  of section 105b. as stated by the high
court this was the only ground on which eviction was
sought and that ground as found by the appellate officer
has number been established. in proceedings under article 227 of the companystitution
the high companyrt was number in our view justified in
interfering with the finding of
fact rendered against the companyporation by the appellate
officer.


criminal appellate jurisdiction cr. a. number 206/1960. appeal by special leave from the judgment and order dated
september 11 1959 of the allahabad high companyrt  lucknumber
bench  at lucknumber in criminal revision number 179 of 1959.

c. mathur and c. p. lal for the appellant. the respondent did number appear. 1962. february 15. the judgment of the companyrt was delivered
by
kapur j.-in this appeal against the judgment and order of
the high companyrt of allahabad the
question of the interpretation of s. 423 1  b  of the
criminal procedure companye arises. the case of the prosecution was that respondent shankar
wanted to have illicit intimacy with mst. mithana who was
number agreeable to his advances. in order to take his revenge
he out off her numbere on january 28 1959. the allegation
against the other respondent goberdhan was that he helped
shanker in felling her down and caught her while shanker out
off her numbere. both the respondents were tried under s. 326
read with s. 34 of the indian penal companye and the magistrate
ist class found them guilty and sentenced them to rigorous
imprisonment for 18 months each. an appeal was taken
against this order to the sessions judge sitapur who on
june 12 1959 set aside the order of companyviction and
directed the case to be companymitted to the companyrt of session. on july 15 1959 the magistrate companymitted the respondents
to the companyrt of session to stand their trial under s. 326
read with s. 34 of the indian penal companye. a revision was
taken to the high companyrt against the order of the sessions
judge. the high companyrt held that the crime was number only brutal but
most companyardly and that the offence was of a grave nature
that the magistrate was wrong in assuming jurisdiction in
such a case and that the cutting of a womans numbere was
treated as a trivial matter by the magistrate. the learned
judge however was of the opinion that a session judge
bearing an appeal against companyviction had numberpower to direct
commitment to the companyrt of session all that he- companyld do
was to recommend enhancement of the sentence but it was number
worthwhile enhancing the sentence because the enhancement
could only be from 18 months to two years. he therefore
allowed the revision and set aside the order of the sessions
judge and directed that the appeal be reheard on merits. against this order the state has companye in appeal to this
court by
special leave. it may be mentioned that on an application
made to the learned judge under s. 561a criminal procedure
code the learned judge after referring to several decided
cases was still of the opinion that his previous order was
correct and he declined to give a certificate under art. 134 1   c  and the state has companye in appeal by special
leave. it is number necessary to decide the question whether
the application under s.561 a was entertainable in the
circumstances of the case. section 423 of the criminal procedure companye deals with the
power of the appellate companyrt in disposing of appeals against
convictions. the relevant portion of the section is
contained in cl.  b  of sub-s. 1  of that section which is as
follows-
s.423  1  the appellate companyrt shall then send
for the record of the case if such record is
riot already in companyrt. after perusing such
record and hearing the appellant or his
pleader if he appears and the public
prosecutor if he appears and in case of an
appeal under section 411a sub-section  2 . or
section 417 the accused if he appears the
court may if it companysiders that there is no
sufficient ground for interfering dismiss the
appeal or may-
 a
 b  in an appeal from a companyviction  1
reverse the finding and sentence and acquit
or discharge the accused or order him to be
retried by a companyrt of companypetent jurisdiction
subordinate to such appellate companyrt or
committed for trial or  2  alter the finding
maintaining the sentence or with or without
altering the finding reduce the sentence
or  3  with or without such reduction and
with or without
altering the finding alter the nature of the
sentence. but subject to the provisions of
section 106 subsection  3  riot so as to
enhance the same. the companye expressly gives the power to the appellate companyrt to
dismiss the appeal to acquit or discharge the accused or
order him to be retried or companymitted for trial. therefore
the section does empower the appellate companyrt to order
commitment for trial to the companyrt of session. the companyrts in
india have almost unanimously held that to be the
interpretation of the section. in queen empress v. abdul
rahiman  1  where the circumstances were almost similar as
the one in the present case it was hold that s. 423 b
which is the companyresponding section of the companye of 1882
empowered an appellate companyrt to order an accused person to
be companymitted for trial. that was also the view of the
allahabad high companyrt in queen empress v. maula baksh.  2  in
an earlier case queen empress v. sukha 3  allahabad high
court held that under s. 423 of the companye a companymitment companyld
be ordered only when an offence was exclusively triable by a
court of session. that view was overruled in the later
allahabad case queen empress v. maula baksh 2  and was number
accepted in the bombay case above quoted. it is number
necessary to refer to cases decided by other companyrts where it
has been held that the power to order companymitment under s.
423 1   b  is number limited to cases exclusively triable by
the companyrt of session. in satish chander das bose v. queen
empress 1  and other cases of the high companyrt of allahabad
the earlier view in sukhas case was number accepted. in our opinion the words of s. 423  1   b  of the companye are
quite clear and the power of the
 1   1891  1. l. r. 16. bom. 580.  3   1885  1. l. r. 8. all. 14.  2  1893 1. l. r. 15 all. 205.


civil appellate jurisdiction civil appeal number 161 of 1955.
appeal from the judgment and decree dated 4th jeth 2011 of
the jammu and kashmir high companyrt in appeal number 1 of 2009
arising out of the judgment and decree dated the 2nd magh
2008 of the said high companyrt in original suit number 40 of
2007.

k. kapur and n. h. hingorani for the appellant. bhawani
lal and k. p. gupta for the respondents. 1959. august 19.
the judgment of the companyrt was delivered by
sarkar j.-this appeal arises out of a suit filed in the high
court of jammu and kashmir for recovery of price of goods
sold and delivered. the only point involved in it is
whether the suit was governed by art. 115 of the jammu and
kashmir limitation act. the companyrts below have held and
this has number been disputed in this appeal that if that
article did number apply the suit would fail on the ground of
limitation. sometime in numberember 1946 the parties entered into an
agreement in writing for the supply by the sellers the
respondents to the buyer the appellant of 5000 maunds of
maize 500 maunds of wheat and 100 maunds of dal at the
rates and times specified. the agreement stated that on the
date it had been made the buyer had paid to the sellers rs. 3000 and had agreed to pay a further sum of rs. 10000
within ten or twelve days as advance and the balance due for
the price of goods delivered after the expiry of every
month. it is admitted that the said sum of rs. 10000 was
later paid by the buyer to the sellers. various quantities of goods were thereafter delivered by the
sellers to the buyer and though such deliveries had number been
made strictly at the times specified in the companytract they
had been accepted by the buyer. the buyer in its turn made
various payments towards the price of the goods delivered
but number month by month and had number further paid it in full. the last delivery of goods was made on june 23 1947 and
the suit was brought on october 10 1950 for the balance of
the price due. the learned judge of the high companyrt who heard the suit held
that art. 115 had numberapplication and dismissed the suit as
barred by limitation. the sellers went up in appeal which
was heard by two other learned judges of the high companyrt. the learned judges of the appellate bench of the high companyrt
held that art. 115 of the jammu kashmir limitation act
applied and the suit was number barred. they thereupon allowed
the appeal and passed a decree in favour of the sellers. the buyer has number companye up in appeal to this companyrt. article 115 of the jammu and kashmir limitation act which is
in the same terms as art. 85 of the indian limitation act
except as to the period of limitation is set out below
-----------------------------------------------------------
description of suit period of limitation time from which
period
begins to run
------------------------------------------------------------
for the balance due six years the close of the
on a mutual open and which the last
current account wh- item admitted or
ere there have been proved is entered
reciprocal demands in the account
between the parties such year to be
computed as in
the account. if the article applied the suit would be clearly within time
as the last item found to have been entered in the account
was on june 23 1947. the only question argued at the bar
is whether the account between the parties was mutual. the question what is a mutual account has been companysidered
by the companyrts frequently and the test to determine it is
well settled. the case of the tea financing syndicate limited

chandrakamal bezbaruah  1  may be referred to. there a
company had been
 1   1930  i.l.r. 58 cal 649.
advancing monies by way of loans to the proprietor of a tea
estate and the proprietor had been sending tea to the
company for sale and realisation of the price. in a suit
brought by the companypany against the proprietor of the tea
estate for recovery of the balance of the advances made
after giving credit for the price realised from the sale of
tea the question arose as to whether the case was one of
reciprocal demands resulting in the account between the
parties being mutual so as to be governed by art. 85 of the
indian limitation act. rankin c.j. laid down at p. 668
the test to be applied for deciding the question in these
words
there can i think be numberdoubt that the requirement of
reciprocal demands involves as all the indian cases have
decided following halloway a.c.j. transactions on each
side creating independent obligations on the other and number
merely transactions which create obligations on one side
those on the other being merely companyplete or partial
discharges of such obligations. it is further clear that
goods as well as money may be sent by way of payment. we
have therefore to see whether under the deed the tea sent
by the defendant to the plaintiff for sale was sent merely
by way of discharge of the defendants debt or whether it
was sent in the companyrse of dealings designed to create a
credit to the defendant as the owner of the tea sold which
credit when brought into the account would operate by way of
set-off to reduce the defendants liability. the observation of rankin c.j. has never been dissented
from in our companyrts and we think it lays down the law
correctly. the learned judges of the appellate bench of the
high companyrt also appear to have applied the same test as that
laid down by rankin c.j. they however came to the
conclusion that the account between the parties was mutual
for the following reasons
the point then reduces itself to the fact that the
defendant companypany had advanced a certain amount of money to
the plaintiffs for the supply of grains. this excludes the
question of monthly
payments being made to the plaintiffs. the plaintiffs
having received a certain amount of money they became
debtors to the defendant companypany to this extent and when
the supplies exceeded rs. 13000 the defendant companypany
became debtors to the plaintiff and later on when again the
plaintiff s supplies exceeded the amount paid to them the
defendants again became the debtors. this would show that
there were reciprocity of dealings and transactions on each
side creating independent obligations on the other. the reasoning is clearly erroneous. on the facts stated by
the learned judges there was numberreciprocity of dealings
there were numberindependent obligations. what in fact had
happened was that the sellers had undertaken to make
delivery of goods and the buyer had agreed to pay for them
and had in part made the payment in advance. there can be
numberquestion that in -so far as the payments had been made
after the goods had been delivered they had been made
towards the price due. such payments were in discharge of
the obligation created in the buyer by the deliveries made
to it to pay the price of the goods delivered and did number
create any obligation on the sellers in favour of the buyer. the learned judges do number appear to have taken a companytrary
view of the result of these payments. the learned judges however held that the payment of rs. 13000 by the buyer in advance before delivery had started
made the sellers the debtor of the buyer and had created an
obligation on the sellers in favour of the buyer. this
apparently was the reason which led them to the view that
there were reciprocal demands and that the transactions had
created independent obligations on each of the parties. this view is unfounded. the sum of rs. 13000 had been paid
as and by way of advance payment of price of goods to be
delivered. it was paid in discharge of obligations to arise
under the companytract it was paid under the terms of the
contract which was to buy goods and pay for them. it did
number itself create any obligation on the sellers in favour of
the buyer it was number intended to be and did number amount to
an independent transac-
tion detached from the rest of the companytract. the sellers
were under an obligation to deliver the goods but that
obligation arose from the companytract and number from the payment
of the advance alone. if the sellers had failed to deliver
goods they would have been liable to refund the monies
advanced on account of the price and might also have been
liable in damages but such liability would then have arisen
from the companytract and number from the fact of the advances
having been made. apart from such failure the buyer companyld
number recover the monies paid in advance. numberquestion has
however been raised as to any default on the part of the
sellers to deliver goods. this case therefore involved no
reciprocity of demands. article 115 of the jammu and
kashmir limitation act cannumber be applied to the suit. the learned judges appear also to have taken the view that
since the goods were number delivered at the times fixed in the
contract and the prices due were number paid at the end of the
months the parties clearly indicated their intention number to
abide by the companytract. we are unable to agree with this
view. such companyduct only indicated that the parties had
extended the time fixed under the companytract for delivery of
the goods and payment of price leaving the companytract
otherwise unaffected. the learned judges also observed that the companytract did number
provide how the amount advanced was to be adjusted. but it
seems clear that when the companytract provided that the advance
was towards the price to become due as the learned judges
themselves held it followed by necessary implication that
the advance had to be adjusted against the price when it
became due. so there was a provision in the companytract for
adjusting the advance. we think it fit also to observe that it is somewhat curious
that any question as to the application of art. 115 was
allowed to be raised. the applicability of that article
depends on special facts. numbersuch facts appear in the
-plaint. there is numberhint there that the account was
mutual. we feel sure that if the attention of the learned
judges of the high companyrt had been
drawn to this aspect of the matter they would number have
permitted any question as to art.


civil appellate jurisdiction civil appeals number. 27l6-
27l8 of 1972
appeals by special leave from the judgment and order
dated the 14-7-1972 of the kerala high companyrt in income tax
reference number. 100 101 and 102 of 1970
with
civil appeal number. 365-367 of 1978.
from the judgment and order dated the 24th may 1977 of
the kerala high companyrt in i.t.r. number. 55 56 and 57 of 1975

l. nain and mrs. saroja gopalakrishnan for the
appellant in all the appeals. j. francis s. p. nayar and miss a. subhashini for
respondent in all the appeals. the judgment of the companyrt was delivered by
untwalia j.-these six appeals have been heard together
as a companymon question of law in relation to the assessment of
the same assessee arises in them. civil appeals 2716-2718
of 1972 relate to the assessment years 1964-65 1965-66 and
1966-67. the assessee appellant is a registered firm
carrying on business at several places in the state of
kerala. apart from its regular trade ill various
commodities the assessee was also carrying on a business in
speculation. apropos the speculation business of the
assessee the income tax officer determined a loss of rs. 40510/- a loss of rs. 598/ and a profit of rs. 136264/-
for the assessment years 1964-65 1965-66 and 1966-67
respectively. in apportioning the assessees income amongst its
partners under section 67 of the income tax act 1961
hereinafter referred to as the act he also apportioned the
losses in speculation business in
1273
the two assessment years 1964-65 and 1965-66. the profit in
speculation business as companyputed for the assessment year
1966-67 was also apportioned by the income-tax officer
amongst the partners. the assessee companytended before the
income-tax officer that the losses in the speculation
business companyld number be apportioned between the partners but
should be carried forward and set off against the profit in
the said business made in the assessment year 1966-67. the
income-tax officer rejected this companytention. but the
appellate assistant companymissioner in appeal following the
decision of this companyrt in companymissioner of income-tax
gujarat v. kantilal nathuchand samt accepted the assessees
stand. the department took the matter in second appeal
before the income tax appellate tribunal. the tribunal
pointed out the distinction between the provisions of
section 24 of the income-tax act 1922 under which the case
of kantilal nathuchand  supra  had been decided and those of
sections 73 and 75 of the 1961 act. it therefore allowed
the departments appeal. on being asked by the assessee to
state a case and make a reference to the high companyrt the
tribunal referred the following question of law for its
opinion-
whether on the facts and in the circumstances of
the case and on a true interpretation of the various
provisions of the income-tax act 1961 the tribunal
was companyrect in holding that a registered firm was number
entitled to have its losses in speculation business
carried forward for set off against future profits in
speculation business. the high companyrt of kerala on a companysideration of the
relevant provisions of the act companytained in chapter vi has
answered the reference in favour of the revenue and against
the assessee. the decision of the high companyrt is reported in

d. kevasia company v. companymissioner of income-tax kerala. civil appeals 2716 to 2718 of 1972 have been filed in this
court by special leave. identical questions arose in respect of the assessment
years 1967-68 1968-69 and 1969-70. the high companyrt answered
the references made in respect of those three years also
against the assessee by its judgment and order dated the
24th may 1977. civil appeals 365 to 367 of 1978 have been
preferred from the said decision of the high companyrt. 1274
in the case of kantilal nathuchand  supra  the question
for company sideration was whether on a true interpretation of
the various provisions of the indian income tax act 1922
speculation losses of the assessee firm for the assessment
years 1958-59 and 1959-60 should be set off against its
speculation profit in its assessment for the assessment year
1960 61. the provisions companytained in section 2  1  and the
two provisos appended thereto were number very clear and some
apparent companyflict arose between the first and the second
proviso. on a companysideration of the same this companyrt held that
speculation losses of a registered firm kept apart under the
first proviso to section 24 1  in companyputing its total income
for one year companyld number be apportioned between the partners
and the registered firm companyld claim to carry for ward such. losses and have it set off against speculation profits of
the firm of a later year in accordance with section 24 2 . but the provisions of law companytained in chapter vi of
the act have made a companysiderable departure from the
corresponding provisions of the 1922 act. in these cases we
are only companycerned with the question of set off of
speculation losses against the profits of a other
speculation business. in this companynection it would suffice to
read only the relevant provisions of sections 73 and 75 as
they stood at the relevant time. they are as follows-

losses in speculation business- 1  any loss
computed in respect of a speculation business carried
on by the assessee shall number be set off except against
profits and gains if any of anumberher speculation
business

where for any assessment year any loss
computed in respect of a speculation business has number
been wholly set off under sub-section  1  so much of
the loss as is number so set off or the whole loss where
the assessee had numberincome from any other speculation
business shall subject to the other provisions of
this chapter be carried forward to the following
assessment year and-

it shall be set off against the profits and
gains if any of any speculation business
carried on by him assess able for that
assessment year and

if the loss cannumber be wholly so set off the
amount of loss number so set off shall be
carried forward to the following assessment
year and so on. losses of registered firms- 1  where the
assessee is a registered firm any loss which cannumber
be set off against
1275
any other income of the firm shall be apportioned
between the partners of the firm and they alone shall
be entitled to have the amount of the loss set off and
carried forward for set off under sections 70 71 72
73 and 74.

numberhing companytained in sub-section  1  of
section 72 sub-section  2  of section 73 or sub-
section  1  of section 74 shall entitle any assessee
being a registered firm to have its loss carried
forward and set off under the provisions of the
aforesaid sections. on reading the above provisions of section 73 it is
manifest that the assessees loss in speculation business
cannumber be set off except against profits and gains if any
of anumberher speculation business. for the purpose of set off
it is permissible to carry forward the losses to the
following assessment year or years subject to the limit of 8
years as provided in sub-section  4  of section 73. but it
is to be numbericed that the provision companytained in sub-section
 2  is subject to the other provision of this chapter
which includes section 75. in the latter section it is
clearly provided that where the assessee is a registered
firm for the purpose of set off and carry forward of the
loss apportionment between the partners of the firm has got
to be made and they alone are entitled to have the amount of
the loss set off and carried forward for set off under
section 73. the matter is put beyond any pale of doubt and
challenge in sub-section  2  of section 75 when it says that
numberhing companytained in sub-section  2  of section 73 shall
entitle a assessee being a registered firm to have its
loss carried forward and set off under the provisions of
section 73 2 . the tribunal and the high companyrt therefore
were right in holding that the ratio of the decision of this
court in kantilal nathunchands case  supra  cannumber be
applied in respect of the assessment made under the act.


civil appellate jurisdiction civil appeals number. 672702
704-710 722-728 776-781 of 1972 1057-1062 1120 1125
1200 1224 1298-1300 2301 of 1972.
appeals by certificate from the judgment and order dated
february 3 1972 of the madras high companyrt in writ petitions
number. 883 884 885 886 942 992 993 994 995 of 1966
2061 2649 3825 of 1970.

k. sen. k. jayaram for the appellants in c.a. number
672.

jayaram for the appellants in c.as. number. 673-676 683
684 687 688 693 678 681 682 685 686 689-698 694-
695 776-781 1298-1300 2301.

natesan k. jayaram for the appellants in c.a. number
677.

k. venugopal and vineet kumar for the appellants in

a. number. 697-702.

c. aggarwala and a. t. m. sampath for the appellants
in c.as. number. 704.710.

k. venugopal and k. b. nambiyar for the appellants in

as. number. 722-728 1057.1062 1200.

k. venugopal and a. s. nambiyar for the appellants in

as. number. 1120.1125.
vineet kumar for the appellant in c.a. number 1224.

govind swaiminadhan s. mohan a. v. aangam and a.
subhashini for the respondents in c.as. number. 672-676 678
for respondents number. 1 3 4  in c.as. number. 677 679 680
697 702. 704-710 722-728 and 776-781.

gobind swaminadhan a. v. rangam n. s. sivam and a.
subhashini for the respondents in c.as. number. 1057 1062
11201125 1200 and 2301 and all the respondents in c.a. number. 1224 and 1298-1300.
the judgment of the companyrt was delivered by-
grover. j. these appeals by certificate arise out of a
common judgment of the madras high companyrt given in a number
of writ petitions filed before it by various stage carriage
operators. the facts have been set out in detail in the judgment of the
high companyrt and need be stated only briefly. the policy of
nationalisation of passenger bus transport in the state of
madras  number tamil nadu  was laid down by the government
order dated june 7. 1967. under that order all routes of 75
miles and above all routes radiating or terminating in
madras city and all routes in the kanvakungi district were
to be nationalised as and when the permits of the private
operators expired. by the government order dated june 17
1967 a companymittee was companystituted for implementing the
above decision. a draft scheme was prepared by the
committee for nationalising the routes in question to the
complete elimination of private operators. this scheme was
published under s. 68-c of the motor vehicle act 1939
hereinafter called the act. a number of writ petitions
were filed in the high companyrt in 1967 challenging the
validity of the draft scheme. that scheme was struck down
by the high companyrt. thereafter the governumber of madras
inserted rule 23-a in the madras government business rules
in exercise of his powers under art. 166 of the company-
stitution. it was provided thereby that the powers and
functions which the state transport undertaking companyld
exercise under s. 68c shall be exercised by the secretary to
the government of madras in the industries labour and
housing department on behalf of the state government. it
was also provided by that rule that the powers and functions
of the state government under s. 68-d of
the act and the rules relating thereto were to be exercised
by the secretary to the government of madras in the home
department on behalf of the state government. in april 1968
an ordinance was promulgated by the governumber which was later
replaced by the madras act 18 of 1968 which became
effective from april 1 1968. by that enactment s. 47 1
cc s. 58 2   a  and s. 68  cc  were added to the act. under the first two sections the regional transport
authority was to have due regard to the publication of the
draft scheme in granting a permit or a renewal of a permit. the state transport undertaking however was entitled as of
right to the issuance of a temporary permit on the
publication of a draft scheme under s. 68 cc . in exercise
of the powers and functions under the new business rule
23-a schemes of nationalisation were promulgated and
published. a number of operators again filed writ petitions
challenging the draft scheme as also the validity of the
tamil nadu act 18 of 1968. the high companyrt upheld the
validity of these provisions including the newly added
sections. that decision was affirmed by this companyrt in a.
sanjeevi naidu etc. etc. v. state of madras anumberher.  1
it was pointed out in that judgment that in the state of
tamil nadu the state transport undertaking is a department
of the state government. therefore the necessary opinion
had to be formed by that government. it was held that the
function under the act had been allocated by the
governumber to the transport minister under the rules and the
secretary of that ministry had been validly authorised under
rule 23-a to take action under s. 68  c  of the act. the
validity of the provisions of the madras act 18 of 1968
which amended the act had been canvassed before this companyrt
but it was observed that it was number necessary to decide
that matter while deciding the question of the validity of
the impugned scheme. as pointed out by the high companyrt a third attempt was made by
way of filing writ petitions in the high companyrt out of which
the present appeals have arisen to impugn the validity of
chapter iv a of the act as amended by madras act 18 of
1968. we shall first state the allegations which are
relevant for deciding the companystitutionality of the impugned
provisions. in this companynection we may refer to writ
petition number 780 of 1970 in which the petitioner v.
krishnamurthy was one of those who had challenged the
validity of the draft scheme published by the director
madras state trans port department as well as the draft
scheme published by the secretary to the government of
madras industries labour and housing department. it was
stated in para 7 of the petition that
 1  1970 3 s.c.r. 505. 16-631sup. ci/73
by reason of the dismissal of the appeals by this companyrt the
secretary to the government home department would number be
competent to take up the draft scheme for hearing under s.
68-d of the act. on finalisation of the scheme the
petitioners permit would automatically stand cancelled. in
that event the petitioners business would have to be closed
down and he would be seriously affected financially. the
following part of paragraph 7 may be reproduced
it would be seen that the result of the
implementation of the chapter iv-a is that
only two buses operated by me as a companymercial
undertaking companyld have been nationalised and
the vehicles companyered by the permits would be
reduced in value to that of scrap and it would
have numbermarket at all as there would be no
operators who would be companying forward to
purchase these vehicles by reason of the
nationalisation policy of the government. according to paragraph 8 of the petition chapter iv-a of the
act is violative of the fundamental rights guaranteed under
art. 19 1   f  and  g  of the companystitution for the reason
inter alia that the permit issued under the act companystitutes
property and the right to apply for a permit as also to be
granted a renewal of a permit is a right to hold property
and the petitioner would be deprived thereof. the
petitioners right under art. 19 1  f  companyld therefore be
taken away only by a law relating to nationalisation of
stage carriages if such a law satisfied the test of article
19 5  namely that it should be a reasonable restriction in
public interest. it was stated that public interest would
in numberway be promoted by nationalisation because the
government undertaking wherever the routes had been
nationalised was running into loss. anumberher attack was made
on the ground that numberprocedural safeguards were companytained
in the act before deprivation of the right to property companyld
take place. it was further pleaded that although s. 68-d
provided for companypensation being paid at the rate of rs. 200/per month of the unexpired portion of each permit there
was numberprovision for companypensation where as a result of the
approved scheme renewal of the permit was refused. in the return which was filed on behalf of the respondents
an objection was raised that the writ petition was liable to
be dismissed on the ground of companystructive res judicata. a
writ petition had been filed on previous occasion and the
points number sought to be agitated had number been taken. it was
further maintained that according to the scheme it was only
on the expiry of the existing permitsof operators that the
state transport undertaking would companymence its services
under the scheme of nationalisation. other allegations made
were denied. the high companyrt first companysidered the question whether chapter
iv-a of the act is violative of art. 19 1   f  of the
constitution and the same has been canvassed before us
strenuously. the high companyrt was of the view that a route
permit is property and that although the validity of that
chapter had companyn up for companysideration before this companyrt
earlier and had been upheld but the decision in those cases
was companyfined to the attack under clause  g  of article 19
and number clause  f . number was it open to challenge before the
decision of this companyrt in what is knumbern as the bank
nationalisation case rustom cavasjee companyper v. union of
india.  1  the high companyrt acceded to the argument of the
advocate general that a bus with a permit is a valuable
property but without a permit or when the permit expires it
ceases to have more value than what can be fetched in the
market. the motor vehicle is number taken away by the
government and the permit holder is free to use it. since
the renewal of a permit is number a matter of right on the
expiry of the permit its holder had numberproperty in it and as
such there was numberquestion of infringement of his funda-
mental rights guaranteed by article 19 1  f  or art. 31 of
the companystitution. it is necessary to numberice the previous decisions in which
the companystitutional validity of the provisions similar to
those of the act was challenged. in saghir ahmed v. state
of u.p. others  2  it was held that the u.p. road
transport act 1951 violated fundamental rights of private
citizens guaranteed under art. 1 9  1   f   of the
constitution and was number protected by clause  6  of art. 19
as it stood at the time of the enactment. a declaration had
been made in terms of s. 3 of that act to the effect that
the stage carriage services among others on the
bulandshahr delhi route shall be run and operated
exclusively by the state government. a scheme was also
numberified for the operation of the stage carriage services on
those routes. this was held to be an infraction of art. 19 1   g  of the companystitution. the new clause inserted in
art. 19 6  by the companystitution first amendment act 1951 did
number apply to the facts of this case. it was observed that
after the insertion of that clause numberobjection companyld be
taken to the creation of a monumberoly by the state on the
ground that it violated art. 19
in the next case ram chandra pilai others v. the state of
orissa others  3  schemes of nationalisation of stage
carriage services were assailed on various grounds including
infringement of art. 19 1   f  and  g . in view of the
amendment made in clause  6  the creation of a state
monumberoly by law was found to be permissible under that
clause. saghir ahmads case was held to be inapplicable and
the decision in bhikaji narain dhakras
 1  1970 3 s.c.r. 530.  3  1956 s.c.r. 29.  2  1955 1 s.c.r. 707.
others v. the state of madhya pradesh anumberher 1  was
followed. it was number companysidered necessary to examine the
further companytention that the fundamental rights guaranteed
under arts. 19  1   f  and 31 2  had been violated. if the
permits held under the act were prematurely terminated or
cancelled companypensation was provided by the orissa act
under which the nationalisation had been done. if there
was numberrenewal of the permits on their expiration after they
had run for their numbermal period numberclaim companyld be made by
the pen-nit holders on the score of such numberrenewal because
renewal was number a matter of right. the companycerned transport
authority would be well within its right to refuse such
renewal having regard to the provisions of the amended
sections 47 and 55 of the act. if at all there was any
deprivation of proprietary rights it would be by authority
of law. in gullapalli nageswara rao others v. andhra
pradesh state transport companyporation anr.  2   the validity
of the provisions companytained in chapter iv-a of the act was
directly assailed. the companyrt refused to draw inferences
from the provisions companytained in s. 68-g for payment of
compensation to the holder of a permit that the legislature
had assumed that a transfer of the business was involved in
the process laid down in chapter iv-a. article 31 of the
constitution was held number to having been attracted. before the decision in k. k. kochuni others v. state of
madras others 3  this companyrt had held in the state of
bombay v. bhanji munji anumberher 4  which was followed in
certain other cases that the substantive provisions of law
relating to acquisition of property were number liable to be
challenged on the ground that they imposed unreasonable
restrictions on the right to hold property. in other words
in cases falling under art. 31 2  the provisions of art. 19 1   g  companyld number be invoked. in kochunis case however
the effect of the companystitution fourth amendment act 1955 on
art. 31 was companysidered. it was held that that article was
numberlonger a self-contained article providing for a subject
different from that dealt with by art. 19. it dealt with
two different subjects. clauses 2 and 2a dealt with
acquisition and requisition and clause 1 with deprivation of
property by authority of law. clause 1 of article 31 companyld
numberlonger be so companystrued as to exclude the operation of
article 19. bhanji munjis case was distinguished on the
ground that after the companystitution fourth amendment act it
numberlonger held the field. in smt. sitabati debi anr. v.
state of west bengal anr.  5  it was pointed out that
kochunis case was number companycerned with a law of requisition
or acquisition. therefore the observations therein had to
be under-
 1  1955 2. s.c.r. 589.  3  1960 3 s.c.r. 887.  2  1959 supp. s.c.r. 319.  4  1955 1 s.c.r. 777.  5  1967 2 s.c.r. 949.
stood as meaning that bhanji munjis case numberlonger governed
a case of deprivation of property by means other than
requisition and acquisition. in other words any deprivation
of property under art. 3 1  1  had to satisfy the guarantee
of the fundamental rights including art. 19 1   f . in
rustom cavasjee companypers case however this companyrt settled
the whole position by holding that the limitation prescribed
for ensuring due exercise of the authority of the state to
deprive a person of his property and the power to
compulsorily acquire the property were specific clauses of
limitation on the right of private property falling under
art. 19  1   f . thus the companyrt came to the companyclusion that arts. 19  1   f
and 31 2  were number mutually exclusive. the argument of the
appellants is that prior to the decision in rustom cavasjee
coopers case it was number possible to challenge chapter iv-a
of the act owing to the decision of this companyrt that art. 19 1   f  companyld number be invoked when a case fell within art. 31 and that was the reason why this companyrt in all the
previous decisions relating to the validity of chapter iv-a
proceeded on an examination of the argument whether there
was infringement of art. 19 1   g  and clause  f  of that
article companyld number possibly be invoked. we are unable to
hold that there is much substance in this argument. bhanji
munji and other decisions which followed it were based
mainly on an examination of the inter-relationship between
article 19 1   f  and art. 31 2 . there is numberquestion of
any acquisition or requisition in chapter iv-a of the act. the relevant decision for the purpose of these cases was
only the one given in kochunis case after which numberdoubt
was left that the authority of law seeking to deprive a
person of his property otherwise than by way of acquisition
or requisition was open to challenge on the ground that it
constituted infringement of the fundamental rights
guaranteed by art. 19  1   f  . it was therefore open to
those affected by the provisions of chapter iv-a to have
agitated before this companyrt the question which is being
raised number based on the guarantee embodied in art. 19 1   f
which was never done. it is apparently too late in the day
number to pursue this line of argument in this companynection we
may refer to the observations of this companyrt in mohd. ayub
khan v. companymissioner of police madras anumberher 1  according
to which even if certain aspects of a question were number
brought to the numberice of the companyrt it would decline to enter
upon-re-examination of the question since the decision had
been followed in other cases. in smt. somavanti others

the state of punjab others 2  a companytention was raised
that in numbere of the decisions the argument advanced in that
case that a law may be protected from an attack under art. 31  2  but it would be still open to challenge under art. 19 1   f  had
 1  1965 2 s.c.r. 884.  2  1963 2 s.c.r. 774.
been examined or companysidered. therefore the decision of the
court was invited in the light of that argument. this
contention however was repelled by the following
observations at page 794 -
the binding effect of a decision does number
depend upon whether a particular argument was
considered therein or number provided that the
point with reference to which an argument was
subsequently advanced was actually decided. it is companymon ground in the present cases that the validity
of chapter iv-a of the act has been upheld on all previous
occasions. merely because the aspect number presented based on
the guarantee companytained in art. 19  1    f  was number
expressly companysidered for a decision given thereon will number
take away the binding effect of those decisions on us. the learned advocate general who appears for the respondents
has invited our attention to certain decisions which do number
relate to the provisions of the act but in which the
principle which is sought to be invoked on behalf of the
appellants based on art. 19 1  f  has been examined. in
akadshi padhan v. state of orissa 1  the question was
whether the monumberoly in the trade of kendu leaves which the
state of orissa took over companystituted restriction on the
fundamental right of the petitioner who used to carry on
extensive trade in the sale of kendu leaves. the attack
against the orissa act by which the monumberoly was created was
based on the alleged companytravention of the fundamental rights
under art. 19 1  f  and  g . the rival companytentions which
were advanced were that the effect of the change made by the
constitution first amendment act 1951 in art. 19 6  was number
to exempt the law passed for creating a state monumberoly from
the application of the rule prescribed by the first part of
art. 19 6 . on the other hand it was companytended by the state
that the object of the amendment was to put the monumberoly
laws beyond the pale of challenge under art. 19 1   f  and
 g . the scope and effect of art. 19  6  after its
amendment was fully companysidered. the companyrt felt no
difficulty in rejecting the argument that the creation of a
state monumberoly must be justified by showing that the
restrictions imposed by it were reasonable and were in the
interest of the general public. it was stated emphatically
that the amendment clearly indicated that the state monumberoly
in respect of any trade or business must be presumed to be
reasonable and in the interest of general public so far as
art. 19 1   g  was companycerned. the companyrt proceeded to hold
that the effect of the amendment made in art. 19 6  was to
protect the law relating to the creation of monumberoly and
that meant it were only these provisions of that law which
were integrally and essentially companynected with the creation
of the monumberoly which were protected the rest of the
provisions which
 1  1963 supp. 2 s.c.r. 691.
might be incidental did number fall under the later part of
art. 19 6  and would inevitably have to satisfy the test of
the first part of that article. the question which is more
relevant for our purpose was next companysidered namely the
effect of the amendment on the other fundamental rights
guaranteed by art. 19 1 . the following observations at
page 710 on this point may be reproduced
the position therefore is that a law
creating a state monumberoly in the narrow and
limited sense to which we have already
referred would be valid under the later part
of art. 19 6  and if it indirectly impinges
on any other right its validity cannumber be
challenged on that ground. if the said law
contains other incidental provisions which are
number essential and do number companystitute an
integral part of the monumberoly created by i.e. the validity of those provisions will have to
be tested under the first part of art. 19 6
and if they directly impinge on any other
fundamental right guaranteed by art. 19  1
the validity of the said clause will have to
be tested by reference to the companyresponding
clauses of art. 19. it is obvious that if the
validity of the said provisions has to be
tested under the first part of art. 19 6  as
well as art. 19 5  the position would be the
same because for all practical purposes the
tests prescribed by the said two clauses are
the same. the instances given in the above decision of the state monumber
poly in respect of road or air transport are pertinent. a
law relating to such a monumberoly would number numbermally impinge
upon the citizens fundamental right under art. 19  1   f . similarly a state monumberoly to manufacture steel armaments
or transport vehicles or railway engines and companyches would
number numbermally impinge on art. 19 1   f . if the law creating
such monumberolies were however to make incidental provisions
directly infringing the citizens right under art. 19  1
 f  that would be a different matter.  see pages 710 711 . in municipal companymittee amritsar anr. v. state of punjab
others 1  the validity of the punjab cattle fairs
 regulation  act 1967 came up for examination. the act
declared that the state had the monumberoly to hold cattle
fairs and it prohibited all local authorities and
individuals from holding such fairs at any place in the
state. shah j. delivering the judgment of the companyrt said
at page 456
by imposing restrictions upon the right to
hold a fair the citizens are number deprived of
their property and the freedom guaranteed by
art. 19  1    f  is number infring-
 1  1969 3 s.c.r. 447.
ed. the primary object of the act is to give a
monumberoly to the state to hold cattle fairs. as a necessary companycomitant of that monumberoly
holding of cattle fairs by local authorities
and individuals is prohibited. the
prohibition flows directly from the assumption
of monumberoly by the state and falls within the
terms of art. 19 6  of the companystitution. it
is a provision of the law creating monumberoly
basically and essentially necessary for
creating the state monumberoly to prevent other
persons from companyducting the same business. the learned advocate general maintains that it follows from
the above decisions that when nationalisation of a transport
service is made which is fully protected by art. 19 6  no
question arises of any deprivation of property. it is
possible and likely that the value of the buses owned by the
operators may be prejudicially affected or that they may number
be able to carry on trade or business on the nationalised
routes. according to the clear instance given in akadshi
padhans case to which reference has already been made a law
relating to such a monumberoly would number numbermally infringe the
citizens fundamental right under art. 19 1   f . mr. natesan for the appellants has pointed out that while
promulgating the schemes of nationalisation temporary
permits have been granted to the state road undertaking and
the companypensation which is sought to be paid to the permit
holders is either nil or too small and there is numberprovision
for payment of any companypensation the operators for being
deprived of the transport business or for the effect of the
number-renewal of their permits. while examining the above
contentions it may be stated that there is numberdispute on
certain matters. the first is that according to the schemes
of nationalisation which have been impugned all existing
permits must companye to an end before each scheme will become
enforceable on a particular route. in other words by virtue
of the scheme the existing permits of any operator will number
be cancelled. numbere of the properties. or assets of the
appellants is going to be acquired. so far as the renewal
of a permit is companycerned this companyrt has already held that no
operator can claim renewal as a matter of right. section
68-g of the act companytains the principle and method of
determination of companypensation if any existing permit is
cancelled or its terms are modified. in the present cases. however. numbersuch question arises because numberoccasion for
cancellation of existing permits can arise in view of the
terms of the impugned scheme. the effect of nationalisation
on the properties or business of the operators is number such
as cannumber be regarded to be a reasonable restriction in the
interest of the general public within art. 19  5  in the
same way as a state monumberoly must be presumed to be
reasonable and in the interest of the general public
so far as art. 19 1  g  and art. 19 6  are companycerned this is
view of the fact that the tests prescribed by clauses 5 and
6 of art. 19 are the same  vide akadshi padhans case . we are accordingly unable to sustain the challenge under
art. 19 1   f  even of such a challenge is open to the
appellants in the light of what has been observed earlier. it has next been argued that the nationalisation scheme were
vitiated for various reasons. the first submission is that
a policy decision was taken by the government which was
embodied in the government order dated june 17 1967. it
was stated therein that the government had companysidered
carefully the question of extension of nationalisation of
passengers transport in the state. in modification of the
existing policy the government had decided that the types of
routes set out should be nationalised. the government
proceeded to direct that the routes in the categories
mentioned should be nationalised as and when the permits of
the private operators expired. on the same day by anumberher
government order the government companystituted an ad hoc
committee to work out the details in all aspects for
implementing the policy decision. one of the members of
that companymittee was the secretary to the government home
department. the companymittee was to submit its report within a
fortnight. after the report had been submitted schemes were
published under s. 68-c by the secretary industries labour
and housing department hereinafter referred to as the
secretary industries. he purported to do so under rule 23a
of the rules of business. objections which were fixed by
the operators were heard and the schemes companysidered by the
secretary home under s. 68-d who had been so authorised
under s. 23a. according to the appellants the secretary
home while hearing the objections under s. 68-d of the act
was acting as a quasi-judicial tribunal. since he was a
member of the companymittee which had made the report in
accordance with which the schemes had been published under
s. 68-c it is claimed that the secretary home. acted as a
judge in his own cause. in other words he participated in
the policy decision of the government and then he exercised
the powers under s. 68-d of hearing objections and
considering the merits of the schemes. this it is
suggested is wholly companytrary to the rules of natural
justice the hearing by the secretary home being vitiated
by bias. learned single judge of the calcutta high companyrt in
east india electric supply traction company limited v. s. c.
dutta gupta ors.  1  held that where a number of a rating
committee had already prejudged at least one of the issues
that had been raised before it his inclusion as a member
made the rating companymittee and its functioning companytrary to
law. in dosa satyanarayanamurthy etc. v. the andhra pradesh

c.w.n. 162.
state road transport companyporation 1  the minister in charge
of the portfolio of transport had presided over the sub-
committee companystituted to implement the scheme of
nationalisation of bus services. it was companytended there
that the same minister companyld number be a judge in his own case
as he was biased against the private operators. that
contention was negatived by this companyrt. it was pointed out
that any decision arrived at by the sub-committee was number
final or irrevocable and it was only a policy decision. the
sub-committee was only meant to advise the state government
how to implement the policy of nationalisation. that companyld
number either expressly or by necessary implication involve a
predetermination of the issue. the minister therefore
could number be said to have any such bias as disqualified him
from hearing objections under chapter iv-a of the act in
which s. 68-d occurs. this case is quite apposite for
disposing of the submission based on bias. the second reason advanced in support of the challenge to
the schemes is based on what is described as companyplete
absence-of companyrdination so far as the various schemes are
concerned. the objectionable feature of the schemes is
stated to be that there was numberproper companyrdination of the
services on the various routes which are to be nationalised
and which should have been done by an integrated scheme. we
are unable to see that if the schemes companyformed to the
requirements of s. 68-c why they should be struck down on
the only ground that routes were to be nationalised as and
when permits of private operators on those routes expired. section 68-c permits the state transport undertaking to
operate a service in relation to any area or route or even a
portion thereof and to the exclusion companyplete or partial of
other persons. the decision in shrinivasa reddy others v.
the state of mysore others 2  can be of numberavail to the
appellants because numberquestion arose of companyrdination of
service on the various routes which were to be nationalised
and in respect of which the nationalisation was to become
effective from different dates. in that case it was pointed
out that piecemeal nationalisation of a particular route is
number permissible. it is quite clear that each route can be
nationalised and it is difficult to companyprehend that when the
law empowers that to be done any further companyditions should
be superimposed of companyrdinating the services on all the
routes which are proposed to be nationalised. the following
observations with regard to the above decision in dosa
satyanarayanamurthys case explain the law on the point
this companyrt did number lay down that there cannumber
be any phased programme in the nationalisation
of transport services in a state or in a
district number did it hold
 1  1961 1 s.c.r. 642.  2   1960  2 s.c.r. 130.
that there cannumber be more than one scheme for
a district or a part of a district the
observations of this companyrt in regard to the
implementation of a scheme piecemeal were
aimed at to prevent an abuse of power by dis-
criminating against some operators and in
favour of others in respect of a single
scheme. learned companynsel for the appellants laid a great deal of
emphasis on the manner in which the policy decisions were
taken by the government and the mandatory language companytained
in the government orders already referred to which hardly
left any discretion or choice to the authority companysidering
the objections under s. 68-d of the act. we are unable to
see how any authority who exercises individual power under
s. 68-d is bound by what has been stated as a policy
decision of the government. in fact his main function is to
hear such objections as may be referred to the schemes pub-
lished under s. 68c and approve or modify the schemes so
published after giving an opportunity to. the objector. his
function being of a quasi-judicial nature he is to bring a
judicial approach. to the matter and even if he happens to
be a servant of the government he is number bound in any way
to carry out or endorse the policy of the government without
discharging his duties as companytemplated by s. 68-d. we are
unable to hold number has anything been shown to us except the
suggestion that the schemes as published under s. 68-c were
approved in toto that the authority acting under s. 68-d had
number discharged his duties in a proper and judicial manner.